Yahoo Inc last year secretly built a custom software program to search all of its customers' incoming emails for specific information provided by US intelligence officials, according to people familiar with the matter.
The company complied with a classified US government demand, scanning hundreds of millions of Yahoo Mail accounts at the behest of the National Security Agency or FBI, said three former employees and a fourth person apprised of the events.
Some surveillance experts said this represents the first case to surface of a US Internet company agreeing to an intelligence agency's request by searching all arriving messages, as opposed to examining stored messages or scanning a small number of accounts in real time.
It is not known what information intelligence officials were looking for, only that they wanted Yahoo to search for a set of characters. That could mean a phrase in an email or an attachment, said the sources, who did not want to be identified.
Reuters was unable to determine what data Yahoo may have handed over, if any, and if intelligence officials had approached other email providers besides Yahoo with this kind of request.
According to two of the former employees, Yahoo Chief Executive Marissa Mayer's decision to obey the directive roiled some senior executives and led to the June 2015 departure of Chief Information Security Officer Alex Stamos, who now holds the top security job at Facebook Inc.
Through a Facebook spokesman, Stamos declined a request for an interview.
The NSA referred questions to the Office of the Director of National Intelligence, which declined to comment.
The request to search Yahoo Mail accounts came in the form of a classified edict sent to the company's legal team, according to the three people familiar with the matter.
US phone and Internet companies are known to have handed over bulk customer data to intelligence agencies. But some former government officials and private surveillance experts said they had not previously seen either such a broad demand for real-time Web collection or one that required the creation of a new computer program.
Alphabet Inc's Google and Microsoft Corp, two major US email service providers, separately said on Tuesday that they had not conducted such email searches.
Under laws including the 2008 amendments to the Foreign Intelligence Surveillance Act, intelligence agencies can ask US phone and Internet companies to provide customer data to aid foreign intelligence-gathering efforts for a variety of reasons, including prevention of terrorist attacks.
Disclosures by former NSA contractor Edward Snowden and others have exposed the extent of electronic surveillance and led US authorities to modestly scale back some of the programs, in part to protect privacy rights.
Companies including Yahoo have challenged some classified surveillance before the Foreign Intelligence Surveillance Court, a secret tribunal.
Yahoo in 2007 had fought a FISA demand that it conduct searches on specific email accounts without a court-approved warrant. Details of the case remain sealed, but a partially redacted published opinion showed Yahoo's challenge was unsuccessful.
Some Yahoo employees were upset about the decision not to contest the more recent edict and thought the company could have prevailed, the sources said.
They were also upset that Mayer and Yahoo General Counsel Ron Bell did not involve the company's security team in the process, instead asking Yahoo's email engineers to write a program to siphon off messages containing the character string the spies sought and store them for remote retrieval, according to the sources.
The sources said the program was discovered by Yahoo's security team in May 2015, within weeks of its installation. The security team initially thought hackers had broken in.
In a separate incident, Yahoo last month said "state-sponsored" hackers had gained access to 500 million customer accounts in 2014. The revelations have brought new scrutiny to Yahoo's security practices as the company tries to complete a deal to sell its core business to Verizon Communications Inc for $4.8 billion.
REUTERS