The National Security Agency has been spying on Internet and telephone communications in and out of the United States in an immense program implemented in cooperation with major telecommunications companies, the New York Times reported late Friday.

The news comes just a week after the Bush administration acknowledged the existence of a domestic spying program, while claiming the executive order was limited to those individuals with known terrorist ties. But the Times cites sources who say the surveillance was much broader than admitted.

"What has not been publicly acknowledged is that NSA technicians, besides actually eavesdropping on specific conversations, have combed through large volumes of phone and Internet traffic in search of patterns that might point to terrorism suspects," the Times reported.

Sources say the NSA largely looks at the transaction data, namely the destination and source as well as the amount of traffic moving back and forth. These patterns can help establish known lines of communication that can be more closely tracked.

The Times says that the American government has been pushing the telecommunications industry to urge international phone companies to route calls through U.S. networks. That way, the NSA can eavesdrop on conversations by simply capturing packets on a switch.

Rumors of such a program began surfacing earlier this year, but backbone companies have remained tight-lipped. BetaNews learned in June that the Washington Post was investigating a highly classified government project called "Wormhole," which involved NSA systems being placed in front of switches at major ISPs to capture and analyze traffic.

Legality of such intelligence gathering methods remains murky at best. The Bush administration has already been heavily criticized for authorizing domestic wire taps without court order, and by targeting switches the NSA would be spying on countless Americans while fishing for suspicious behavior.

In addition, with foreign calls being routed through American soil, the Times reports that some judges and law enforcement officials regard eavesdropping on those calls as a possible violation of the Foreign Intelligence Surveillance Act, which requires court-approved warrants for domestic surveillance.