On 3 May 1973, journalists Jan Guillou and Peter Bratt published findings in Folket i Bild/Kulturfront based largely on former IB employee Håkan Isacson. Their reporting alleged that the covert intelligence agency, operating within Sweden’s armed forces, infiltrated domestic political organizations including the FNL Groups and the Communist Party of Sweden, installed a wiretap, maintained foreign agent networks, and exchanged intelligence with overseas services. Sweden’s defence minister Sven Andersson initially denied that IB conducted espionage abroad, burglaries, or political surveillance, while Prime Minister Olof Palme denied a connection between IB and the Social Democratic Party. Later memoir evidence described regular contact between IB director Birger Elmér and senior Social Democratic officials, making the political oversight question a lasting controversy.
The affair also exposed alleged operations involving Palestinian solidarity networks, Egypt, Finland, and Israel, although specific claims—such as intelligence from Palestinian camps contributing to bombings—were disputed and later contested by former operative Gunnar Ekberg. On 22 October 1973, Guillou, Bratt, Isacson, and photographer Ove Holmqvist were arrested for espionage-related offenses; on 4 January 1974, the first three received prison sentences, with Guillou’s later reduced to 10 months. Sweden’s Parliamentary Ombudsman concluded that IB had not violated applicable law, even treating lock-picking break-ins as noncriminal because nothing was stolen. A comprehensive 2002 government report clarified the agency’s activities, but no IB member, politician, or official was indicted.