Protesters call on Palantir to end its work with Immigration and Customs Enforcement at a demonstration outside the company's office in New York last month. (Lauren Stern)

Alex Karp faced a dilemma last year, when employees of the data-mining company Palantir confronted the chief executive with their concerns over a partnership with Immigration and Customs Enforcement, according to three people familiar with the incident.

Palantir provided digital profiling tools to the federal agency as it carried out President Trump’s increasingly controversial policies for apprehending and deporting undocumented immigrants, troubling more than 200 employees who signed a letter to Karp, the people said.

Ending the contracts with ICE would risk a backlash in Washington, where Palantir was quickly becoming a go-to provider of data-mining services to a wide range of federal agencies. Data mining is a process of compiling multitudes of information from disparate sources to show patterns and relationships. Google’s decision, earlier the same year, to end a contract with the Pentagon over pressure from its employees had chilled the Internet giant’s relationships with some government leaders who accused it of betraying American interests.

Karp refused to budge. He renewed an ICE contract worth up to $42 million and defended the program at a company town hall meeting, the people said. In media interviews and an online ad campaign this year, Karp bashed Google for backing out of its government contract and suggested Palantir wouldn’t do the same.

“Silicon Valley is telling the average American ‘I will not support your defense needs,'” Karp told an interviewer in January, a quote the company repeated in a recent ad on Twitter. Peter Thiel, Palantir’s billionaire co-founder, echoed that message at a conference last month, when he called Google’s actions “treasonous.”

The controversy around ICE highlights a tension at the center of Palantir’s business, which relies on the U.S. government for contracts and on Silicon Valley for talent. As Trump’s policies divide tech workers in the largely liberal Bay Area, Palantir must balance keeping workers happy and preserving the trust of its No. 1 customer.

Palantir’s predicament illustrates the tightrope walk many businesses must perform in an age of rising political activism, particularly in Silicon Valley, where tech workers have staged walkouts and circulated petitions to protest collaborations with the Trump administration. In their responses to worker uprisings, the leaders of Amazon, Google, Microsoft and Salesforce have tried to grapple with the ethical concerns posed by their employees — Microsoft, for example, told employees they don’t have to work on military projects if they don’t want to — while making it clear they want to keep doing business with the U.S. government.

So far, Palantir has stood firm in its support of the government, even as employees and activist groups say there is growing evidence that Palantir lends support to agents whose work violates the civil liberties of undocumented immigrants. A workplace raid resulting in the arrest of 680 migrant workers in Mississippi on Aug. 7 was carried out by the unit of ICE that uses Palantir software to investigate potential targets and compile evidence against them.

In another employee petition this month, more than 60 Palantir workers asked management to redirect the profits from ICE contracts to a nonprofit charity, the people said. The company renewed a second ICE contract on Aug. 19.

In an interview with Bloomberg News this week, Karp said the government should be responsible for answering difficult questions about how technologies may be used to surveil citizens.

“I do not believe that these questions should be decided in Silicon Valley by a number of engineers at large platform companies,” Karp said in the interview.

A spokeswoman for Palantir declined to comment for this story or make Karp available for an interview. Thiel’s spokesman declined to make him available for an interview.

Founded in the patriotic fervor that followed the Sept. 11, 2001, terrorist attacks, with $2 million in seed money from a CIA incubator, Palantir has always promoted a mission to defend American interests. Federal authorities rely on its data platform to track down terrorists, insurgents, drug smugglers and insider traders, records show.

Palantir’s business has flourished since Trump took office, with revenue from U.S. government contracts under his first two-and-a-half years in office already surpassing its total under President Barack Obama’s entire second term. The Army contract, awarded in March and potentially worth more than $800 million, marked the first time a Silicon Valley company had been chosen to lead a defense program of record, a type of contract with a dedicated line of funding from Congress.


Palantir's U.S. government contracts

Many of Palantir 2,500 employees have debated the ICE contracts in town hall meetings, office hallways, Slack channels and email threads, according to current and former employees, who spoke on the condition of anonymity because the company bound them to confidentiality agreements. Palantir employees, called “Palantirians,” have taken both sides of the issue: Immigrant employees have written heartfelt letters sharing why they are opposed to the ICE contracts, while at least one former ICE official who now works at Palantir has defended them, according to a current engineer at the company.

Employees who support the ICE partnership believe Palantir has helped the agency do more good than bad, including supporting missions to apprehend dangerous criminals, according to two current employees. But others have felt deflated by what they see as management’s lack of receptivity to their concerns, two former employees said. A company with a mission to “work for the common good,” according to recent job listings, increasingly feels to some workers like a tool for Trump’s political agenda.

“There’s a version of the story where they are the good guys,” one former employee said. “Everyone wants to protect service members from IEDs. Everyone wants to prevent human trafficking. Not everyone can get behind working for ICE to help deport immigrants.”

‘Silicon Valley kids’ earn respect

For years, Palantir was viewed skeptically by Washington insiders, who saw the Palo Alto, Calif.-based company as a ragtag team of tech programmers who wore hoodies and flip-flops to work. They were “a bunch of Silicon Valley kids,” said a former government official who awarded Palantir a contract in 2009.

That image began to change as service members deployed in Afghanistan grew impressed with Palantir’s ability to quickly assimilate troves of data into maps and charts, showing the movements, for example, of insurgents across a landscape and the likely positions of improvised explosive devices. After trial runs with the Navy, Army and Special Forces, several top Pentagon officials saw Palantir’s platform as more powerful and reliable than competing tools supplied by longtime government contractors such as Raytheon. The company still struggled to win defense business because of a contract procurement process that heavily favored incumbents.

The $800 million Army contract, in which Palantir will build the nerve center of a vast intelligence gathering network, was possible only because Palantir successfully argued in court that the government was required by law to consider purchasing commercial products, instead of only custom ones made by contracting firms. It won the court case in 2016, under the Obama administration, and won the contract this past March, amid a blitz of lobbying and relationship-building with the Trump administration.

Palantir’s most visible tie to the White House is Thiel, the company’s outspoken co-founder, chief backer and executive chairman. An avowed libertarian who has railed against the tech industry’s predominantly liberal politics, Thiel frequently embraces controversy. He gained notoriety for bankrolling a successful lawsuit against the news site Gawker, leading to its bankruptcy in 2016. (In an interview with the New York Times, he said Gawker published articles that were “very painful and paralyzing for people who were targeted,” adding: “I thought it was worth fighting back.”)

Thiel donated $1.2 million to Trump’s 2016 campaign and stumped for him at the Republican National Convention, arguing he was the leader with the most potential to rebuild the American economy. He was awarded a spot on Trump’s transition team and helped organize the president’s initial outreach to tech industry leaders. At a Trump Tower summit for tech CEOs on the eve of Trump’s presidency, Karp was invited to represent Palantir. Flanked by titans of Amazon, Microsoft and Google, his was the smallest company by market value represented at the meeting.


Peter Thiel, co-founder, chief backer and executive chairman of Palantir, donated $1.2 million to Donald Trump’s 2016 campaign. He was awarded a spot on Trump’s transition team and helped organize the president’s initial outreach to tech industry leaders. (Andrew Harrer/Bloomberg News)

The investor, who now lives in Los Angeles, makes rare appearances in Washington, but remains in favor with the president, according to a person close to him. Thiel joined Trump and Oracle CEO Safra Catz for a private dinner at the White House earlier this year, according to two people briefed on the meeting. The trio discussed tech companies including Google and Amazon, and the $10 billion cloud-computing contract for which Amazon is competing with Oracle, one of the people said. (Amazon’s founder, Jeff Bezos, owns The Washington Post.)

Several Thiel associates have worked in the administration, including on the transition teams at the Pentagon and the Department of Commerce. Both agencies subsequently awarded contracts to Palantir.

The data-mining firm paid lobbyists $1.7 million in 2018 to push for laws that would help open the government procurement process to commercial technology providers.

The business of war

Google’s withdrawal from the Defense Department program called Project Maven in summer 2018 ignited a debate about how U.S. tech giants should balance the ethical concerns of rank-and-file workers and the security interests of the nation. Thousands of Google employees signed a petition arguing the company “should not be in the business of war,” but ending the artificial intelligence partnership may have risked American lives, former deputy defense secretary Bob Work said at the time.

With Google pulling out of a Pentagon partnership, Palantir saw an opportunity to tell government customers they wouldn’t do the same, said Kara Frederick, an associate fellow at the Center for a New American Security.

“They see that there is a gap in the market for a company that is willing to stand up and say, ‘Yes, we are going to help the U.S. government achieve its ends,’” said Frederick, who researches the use of emerging technologies in defense.

Palantir’s leaders joined the criticism of Google. In a CNBC interview in January, Karp said Silicon Valley companies that refuse to work with the U.S. government are “borderline craven” and added that he’s happy Palantir is “not on that side of the debate.” In a speech to the National Conservatism Conference in July, Thiel claimed, without evidence, that Google has been “infiltrated by Chinese intelligence.”

Thiel didn’t mention his own ties to a company that benefited from Google’s decision to pull out of the Pentagon deal. Anduril, a defense start-up backed by Thiel’s investment firm, Founders Fund, was recently awarded a contract on Project Maven.

In a tweet this month, Trump responded to Thiel’s allegations against Google, calling the investor “a great and brilliant guy who knows this subject better than anyone.” In a separate follow-up, administration officials said there was no reason to suspect espionage at Google.

In a statement, a Google spokeswoman said the company continues to work with the Defense Department in areas such as cybersecurity and health care, and does not work with the Chinese military.

Raids and deportations

Now, Palantir is in the crosshairs of activists.

Protesters from civil rights groups, including Mijente and Jews for Racial and Economic Justice, have gathered outside Palantir’s Manhattan offices in recent weeks to call for an end to the company’s work with ICE. As employees filed into work in the morning, volunteers handed out fliers explaining how Palantir’s software has been used by ICE agents targeting migrant workers.

“Tell management that you do not want Palantir involved in contracts that harm immigrants,” one flier read.

Palantir began working with the Department of Homeland Security, the agency that oversees ICE, in 2011. The company was involved in an effort called “Operation Fallen Hero,” which hunted down members of the Los Zetas drug trafficking ring believed to have murdered an ICE special agent. Palantir’s software was used to assimilate data from the Drug Enforcement Administration, FBI and DHS — including surveillance images, smuggling routes and electronic communications — to quickly find leads, records show. The operation led to 782 arrests for criminal violations and 634 “noncriminal immigration arrests,” according to an ICE official’s testimony.

In 2014, Palantir won a contract to build a central digital repository of records, called an Investigative Case Management, or ICM, system. The ICM system lets agents access digital profiles of people suspected of violating immigration laws and organize records about them in one place, according to DHS documents. These records may include investigative evidence such as emails, phone records, text messages and data from automatic license plate cameras, according to DHS.

ICE agents relied on Palantir’s ICM system during a 2017 operation that targeted families of migrant children, according to an ICE document published in May by Mijente and the Intercept, an online news service. As part of the mission, ICE agents were instructed to use ICM to document any interaction they have with unaccompanied children trying to cross the border. If the agency determined their parents or other family members facilitated smuggling them across the border, the family members could be arrested and prosecuted for deportation, the ICE document said.

Mijente has argued that by supporting this operation, Palantir was complicit in Trump’s policy of separating families of undocumented immigrants and placing people in border detention centers with questionable conditions. Privacy rights groups including the Electronic Privacy Information Center have raised concerns that ICM and FALCON, another Palantir tool used by ICE, may violate the privacy of the people tracked by these databases.


Alex Karp, chief executive of Palantir, arrives for the Tech for Good summit in Paris in May. (Thibault Camus/AP)

Palantir has a contract with the division of ICE called Homeland Security Investigations, or HSI. It does not have a contract with another ICE division called Enforcement and Removal Operations, or ERO, the unit that historically has taken the lead on raids and deportations of undocumented immigrants. Karp has frequently brought up this distinction when defending the company’s work with ICE, according to former employees.

However, this month, authorities confirmed that the raids in Mississippi were carried out by HSI, the division that uses Palantir. It’s not clear to what extent Palantir’s products have been used to plan or execute workplace raids. During preparations for an ICE raid of 7-Eleven stores across the country last year, an ICE supervisor instructed agents to use Palantir’s FALCON mobile app “to share info with the command center about the subjects encountered in the stores as well as team locations,” according to emails published by WNYC last month.

A spokeswoman for ICE declined to comment.

Saudi Arabian work

Karp, a Democrat, has long been aware that the nature of Palantir’s data-mining work would expose the company to ethical concerns. Early on, he created a privacy and civil liberties team to review ethical issues in government contracts. This group’s key tenet, according to its public statement of principles, is to hold the company accountable for answering one question: “Do I want to live in the kind of world that the technology we’re building would enable?”

When Palantir explored work with the Saudi Arabian government in 2013, workers raised concerns about the country’s human rights record, according to two former employees. The company performed trials of a counterterrorism program with the Saudi government in 2013 and 2014 but declined to pursue further work with the country after that, a person familiar with the company said.

At one of the recent protests outside Palantir’s New York office, Izzy Finkelstein, a volunteer with Jews for Racial and Economic Justice, attempted to talk to more than 75 Palantir employees who passed by her over the course of two hours. Many ignored her, but she estimates more than a dozen employees stopped to talk to her about the ICE program. A few, she said, seemed genuinely concerned.

“I saw a lot of folks who I thought were trying to reckon with this dilemma of, ‘This is my job, and I need a job, but I also don’t want to be working at a company that’s profiting off separating families and mistreating people,' “ Finkelstein said of the employees she met.

Josh Dawsey, Dan Keating and Shane Harris contributed to this story.