Der Spiegel reported on Sunday that the NSA's "Tailored Access Operations" (TAO) has been diverting desktops and laptops shipped to U.S. consumers and installing spyware on them.
According to the report, the process, which TAO calls "interdiction," involves intercepting packages on their way from manufacturers like Dell, Cisco, and Seagate, and installing bugs or spyware on them at a "secret workshop."
The packages are then reintroduced into the delivery pipeline and arrive at their destination without the consumer ever realizing their machine has been compromised.
When contacted by Der Spiegel, Cisco senior vice president John Stewart said that his company is "deeply concerned with anything that may impact the integrity of our products or our customers' networks," and that Cisco does "not work with any government to weaken our products for exploitation."
Unlike most NSA operations, which rely on remote access to targeted computers and networks, the TAO's programs offer unprecedented physical access.