US and UK struck secret deal to allow NSA to 'unmask' Britons' personal data
• 2007 deal allows NSA to store previously restricted material
• UK citizens not suspected of wrongdoing caught up in dragnet
• Separate draft memo proposes US spying on 'Five-Eyes' allies
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The memo explains that the US and UK 'worked together to come up with a new policy that expands the use of incidentally collected unminimized UK data.'

The phone, internet and email records of UK citizens not suspected of any wrongdoing have been analysed and stored by America's National Security Agency under a secret deal that was approved by British intelligence officials, according to documents from the whistleblower Edward Snowden.

In the first explicit confirmation that UK citizens have been caught up in US mass surveillance programs, an NSA memo describes how in 2007 an agreement was reached that allowed the agency to "unmask" and hold on to personal data about Britons that had previously been off limits.

The memo, published in a joint investigation by the Guardian and Britain's Channel 4 News, says the material is being put in databases where it can be made available to other members of the US intelligence and military community.

Britain and the US are the main two partners in the 'Five-Eyes' intelligence-sharing alliance, which also includes Australia, New Zealand and Canada. Until now, it had been generally understood that the citizens of each country were protected from surveillance by any of the others.

But the Snowden material reveals that:

• In 2007, the rules were changed to allow the NSA to analyse and retain any British citizens' mobile phone and fax numbers, emails and IP addresses swept up by its dragnet. Previously, this data had been stripped out of NSA databases – "minimized", in intelligence agency parlance – under rules agreed between the two countries.

• These communications were "incidentally collected" by the NSA, meaning the individuals were not the initial targets of surveillance operations and therefore were not suspected of wrongdoing.

• The NSA has been using the UK data to conduct so-called "pattern of life" or "contact-chaining" analyses, under which the agency can look up to three "hops" away from a target of interest – examining the communications of a friend of a friend of a friend. Guardian analysis suggests three hops for a typical Facebook user could pull the data of more than 5 million people into the dragnet.