Chinese company ZTE Corp to assist the Venezuelan government to monitor citizen behavior using ‘Fatherland Card’

ZTE Corporation, a Chinese multinational telecommunications company, is assisting Venezuela to create a system that can monitor citizen behavior through a new identification card named ‘Fatherland Card’.

A few years ago, in 2008, Venezuelan President Hugo Chávez sent some officials to China, to learn the workings of China’s national identity card program. According to Reuters, “Chávez, wanted help to provide ID credentials to the millions of Venezuelans who still lacked basic documentation needed for tasks like voting or opening a bank account.”

10 years after the trip to China, Venezuela has rolled out a brand new smart-card ID known as the ‘carnet de la patria’ or ‘fatherland card’. This smart ID transmits data about cardholders to computer servers. The card is linked by the government to subsidize food, health and other social programs for the daily needs of the Venezuelans.

According to Reuters, “Venezuela last year hired ZTE to build a fatherland database and create a mobile payment system for use with the card, according to contracts reviewed by Reuters. A team of ZTE employees is now embedded in a special unit within Cantv, the Venezuelan state telecommunications company that manages the database.”

Problems with the Fatherland card

Some Venezuelan citizens and human-rights groups believe that Fatherland card is a tool for Chávez’s successor, President Nicolás Maduro for monitoring the population and allocate scarce resources to his loyalists.

Héctor Navarro, one of the founders of the ruling Socialist Party and a former minister under Chávez said, “Venezuelans with the cards now have more rights than those without.”

Per Reuters, “In a phone interview, Su Qingfeng, the head of ZTE’s Venezuela unit, confirmed ZTE sold Caracas servers for the database and is developing the mobile payment application. The company, he said, violated no Chinese or local laws and has no role in how Venezuela collects or uses cardholder data. We don’t support the government. We are just developing our market.”

To encourage the adoption of the Fatherland card, the government has granted cash prizes to cardholders for performing civic duties, like rallying voters. It has also given one-time payouts, such as awarding moms enrolled in the card a Mother’s Day bonus of about $2.

Fatherland card's hack and the handover to Cantv

Maduro introduced the cards in December 2016. In May 2017, hackers broke into the fatherland database. The hack was carried out by anonymous anti-Maduro activists known as TeamHDP. The group’s leader with the Twitter handle @YoSoyJustincito, said, “the hack was extremely simple and motivated by TeamHDP’s mission to expose Maduro secrets."

During the hack, TeamHDP took screenshots of user data and deleted the accounts of government officials, including Maduro. The president later appeared on television scanning his card and receiving an error message: “This person doesn’t exist.”

According to Reuters, “Screenshots of the information embedded in various card accounts, shared by TeamHDP, included phone numbers, emails, home addresses, participation at Socialist Party events and even whether a person owns a pet. People familiar with the database said the screenshots appear authentic."

“Soon after the hack, Maduro signed a $70 million contract with Cantv and a state bank for ‘national security’ projects. These included the development of a “centralized fatherland database” and a mobile app to process payments, such as the discounted cost of a subsidized food box, associated with the card”, according to Reuters.

Héctor Navarro, a Socialist Party founder, and former government minister said, “It’s blackmail. Venezuelans with the cards now have more rights than those without.

In July 2017, the ownership of the Fatherland card was transferred to Cantv from Soltein, the project documents show. A team of a dozen ZTE developers began bolstering the database’s capacity and security, current and former Cantv employees said.

Among other measures, ZTE installed data storage units built by U.S.-based Dell Technologies Inc. Dell spokeswoman Lauren Lee said, “ ZTE is a client in China but that Dell doesn’t sell equipment to ZTE in Venezuela. Dell reviewed its transactions in Venezuela and wasn’t aware of any sale to Cantv, either."

“Dell is committed to compliance with all applicable laws where we do business,” Lee said in an email. “We expect our customers, partners, and suppliers to follow these same laws.”

“In May, Venezuela held elections that were widely discredited by foreign governments after Maduro banned several opposition parties. Ahead of the vote, ruling party officials urged voters to be grateful for government largesse dispensed via the fatherland cards. They set up ‘red point’ kiosks near voting booths, where voters could scan their cards and register, Maduro himself promised, for a ‘fatherland prize’, said the Reuters report.

An internal Cantv presentation from last year said the system can feed information from the database to ministries to help generate statistics and take decisions. After the vote, government offices including Banco Bicentenario del Pueblo, a state bank, sent Cantv lists with employees’ names to determine whether they had voted, according to the manager who helped set up the servers.

Mariela Magallanes, an opposition lawmaker who headed a commission that last year investigated how the fatherland card was being linked to the subsidized food program, said, “With personal data now so available, some citizens fear they can lose more than just their jobs. The government, the commission said in a report, is depriving some citizens of the food boxes because they don’t possess the card. The government knows exactly who is most vulnerable to pressure."

To know more about this news in detail, head over to the complete coverage on Reuters.

Read Next

Security Vulnerabilities identified in Washington, Georgia, and North Carolina’s voting systems

A Twitter video shows how voting machines used in 18 states can be hacked in 2 mins

“Instead of data scientists working on their models and advancing AI, they are spending their time doing DeepOps work”, MissingLink CEO, Yosi Taguri [Interview]