Australian-Israeli Mossad agent Ben Zygier, who was found dead in a Tel Aviv jail, had passed secrets including the names of the spy agency's at least two top informants in Lebanon to Hezbollah, according to a report.

Zygier alias 'Prisoner X', 34, who was accused of passing tips to the Lebanese militant group that led to the arrest of two people spying for the Jewish state, died in December 2010 in Israel's most secure prison cell, 'The Age' reported.

"Israeli informants have certainly changed sides in the past. But a regular Mossad employee has never done what Zygier did. It is a bitter defeat for the Mossad, but for Hezbollah it is one of the rare instances in which an Arab intelligence service prevailed over its Jewish counterpart," the report said.

Zygier had started working for Mossad in 2003, investigating European companies doing business with Iran and Syria. In 2007 a decision was made to bring him back from the field to a desk job because he performed without much success.

Apparently frustrated by his demotion to a desk job, Zygier had decided to take matters into his own hands and find a way to rehabilitate his reputation within the organisation, the report said.

He had learned that an east European man was known to be close to Hezbollah, and he set up a meeting towards the end of 2008 with the intention of turning him into a double agent.

But the reverse happened, and Zygier became the conduit for information flowing from Tel Aviv to Hezbollah, it said.

When the man asked Zygier for proof that he was a real Mossad agent, he gave up the names of Israel's two top Lebanese informants - Ziad al-Homsi and Mustafa Ali Awadeh.
"He ended up on a precipitous path. He crossed paths with someone who was much more professional than he was," the report said. It said that Zygier was unable to bear the shame and he apparently took his own life in 2010.

His actions are a heavy blow to the Mossad because they raise doubts as to the integrity of the agency's own people – and the manner in which it recruits employees, it added.
Lior Brand, one of Zygier's friends from Kibbutz Gazit, believes Zygier simply wasn't up to the task.

The lies, the silence and the loneliness were too much for him, says Brand, adding that Mossad "made a big mistake" by recruiting him.

He says he will never forgive it for recruiting the wrong person, it further said.