Foreign interference threats are rising and anti-authority extremism isn't likely to wane even with the end of Covid-19 measures, public intelligence reports show.

The Security Intelligence Service (SIS) has uncovered several intelligence officers working for a foreign state in New Zealand who have cultivated "a range of relationships of significant concern".

"The NZSIS has continued a long-running espionage and interference investigation into a number of individuals connected to a foreign state. We assess these individuals are intelligence officers who are undertaking intelligence activity in New Zealand," the agency reported.

"The NZSIS has identified increasingly concerning activity from these individuals over the reporting period, including the cultivation of a range of relationships of significant concern. The NZSIS shared these insights with relevant New Zealand government agencies to help inform a specific decision that involved those individuals and their associates. Government officials were able to use the advice to take action to limit the harm and prevent future national security threats to New Zealand."

This was one of several case studies detailed in the SIS' latest annual report, which was released alongside the Government Communications Security Bureau's (GCSB) own report.

In the documents, the country's intelligence agencies warn that foreign interference in New Zealand is on the rise, including state-sponsored cyber attacks and in-person intelligence gathering. They also say violent extremism continues to pose a threat, with the appearance of a new genre of anti-authority, politically-motivated extremism off the back of opposition to Covid-19 measures.

The GCSB said a growing proportion of cyber incidents affecting major New Zealand institutions can be linked to state-sponsored actors. Between July 1, 2021 and June 30, 2022, of 350 reported major incidents, 118 were connected to foreign states. That makes up 34 percent of cyber attacks, up from 28 percent the previous year.

"We have seen continued changes in tactics, techniques and procedures by malicious actors, who take advantage of rapidly evolving technology and its global use. This includes increasingly sophisticated ransomware attacks, the mass exploitation of recently disclosed vulnerabilities, and attacks on supply chains to compromise customers," the agency reported.

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"We have also seen a shift in the strategic priorities of state-sponsored actors and the pursuit of new revenue streams by sophisticated criminally motivated actors. The line between these two continue to blur as criminal groups increasingly use capability once only used by state actors, and a small number of states continuing to provide safe harbour to criminal groups."

The SIS said some states have engaged in "enduring and persistent" interference efforts, including "New Zealand-based individuals cultivating New Zealanders for intelligence purposes, collecting intelligence against the New Zealand Government, targeting New Zealanders with access to sensitive information, and interfering in New Zealand’s politics, private sector, and civil society".

Activity has become "increasingly aggressive" from some foreign individuals but the Government has been able to counter them due to increased information sharing with foreign and domestic partners.

"Information sharing enabled our ability to identify previously unknown individuals of security concern, as well as to increase our confidence in the assessments we provide to the New Zealand Government," the SIS said.

Another case study the agency provided involved someone in New Zealand who was targeted by agents of a foreign state due to their political views.

"Due to the potential risks posed to the individual by the foreign state, the NZSIS engaged directly with the person to further understand the issue and provide advice around their safety and welfare. This activity contributed to a wider objective seeking to raise awareness within communities at risk of foreign interference."

The SIS also provided information on its counter-terrorism and counter-extremism work, including case studies of its investigations into three individuals.

One, a person based in New Zealand who expressed intent to undertake a terror attack over Covid-19 policies, is still being closely monitored.

Another New Zealand-based individual stated online their desire to conduct an Isis-inspired terror attack. "The NZSIS worked closely with other government agencies to disrupt the potential threat posed by this person," the agency reported.

The third involved an online account expressing white supremacist violent rhetoric which stated it was based in New Zealand. The SIS identified the man behind the account and concluded he was not based in the country.

More broadly, the agency said, the 2021/22 year saw the emergence of a new conspiracy theory-based violent extremist ideology.

"Some identity-motivated and politically-motivated violent extremist groups have incorporated anti-authority themes into their narratives, blurring the lines between extremists and conspiracy theorists," the SIS reported.

"The 2021/22 period saw an increase in the number of people involved in anti-authority or conspiracy-driven violent extremist ideologies, which we classify as Politically-Motivated Violent Extremism. This includes individuals who reacted, or incited others to act, with violent intent in opposition to Covid-19 prevention programmes, public health measures, and the wider New Zealand Government.

"Violent extremists appear less motivated by specific ideologies than they previously were. Increasingly, we are seeing violent extremists coalesce around core ideas, such as global conspiracies and anti-authority, rather than specific ideologies or groups. This trend is likely influenced by the online environment, which continues to spread a range of violent extremist narratives."

There are also some people who espouse violent ideological language but who are assessed as being more fixated on violence than motivated by any particular ideology.

"In these cases, the NZSIS works closely with the New Zealand Police to determine whether the case should be managed as a threat to public safety or a violent extremist threat."

Violent extremist content online was specifically mentioned by the agency in its report. It said this was contributing to the ongoing radicalisation of some individuals - particularly young people.

"There remains concern that the volume and normalisation of violent rhetoric online could radicalise individuals who were not previously on the violent extremist spectrum," the agency assessed.

"The NZSIS is aware of an increasing number of young people in New Zealand who are consuming violent extremist material, mostly online. Young people may be involved in discussions around committing attacks on target groups, often using dark humour to gain social credit. Some young people have gone on to express support for violent extremism."