Forty-three veterans of one of Israel’s most secretive military intelligence units – many of them still active reservists – have signed a public letter refusing to serve in operations involving the occupied Palestinian territories because of the widespread surveillance of innocent residents.

The signatories include officers, former instructors and senior NCOs from the country’s equivalent of America’s NSA or Britain’s GCHQ, known as Unit 8200 – or in Hebrew as Yehida Shmoneh-Matayim.

They allege that the “all-encompassing” intelligence the unit gathers on Palestinians – much of it concerning innocent people – is used for “political persecution” and to create divisions in Palestinian society.

The largest intelligence unit in the Israeli military, Unit 8200 intercepts electronic communications including email, phone calls and social media in addition to targeting military and diplomatic traffic.

The signatories say, however, that a large part of their work was unrelated to Israel’s security or defence, but appeared designed to perpetuate the occupation by “infiltrating” and “controlling” all aspects of Palestinian life.

Written in uncompromising language the letter states: “We, veterans of Unit 8200, reserve soldiers both past and present, declare that we refuse to take part in actions against Palestinians and refuse to continue serving as tools in deepening the military control over the Occupied Territories.”

They add: “The Palestinian population under military rule is completely exposed to espionage and surveillance by Israeli intelligence. It is used for political persecution and to create divisions within Palestinian society by recruiting collaborators and driving parts of Palestinian society against itself. In many cases, intelligence prevents defendants from receiving a fair trial in military courts, as the evidence against them is not revealed.”

Accompanying the letter – published in the Israeli media on Friday, and organised several months before the recent Gaza war – are a series of testimonies provided by the signatories to Yedioth Ahronoth and shared with the Guardian.

A common complaint, made in both the testimonies and in interviews given by some of the signatories, including to the Guardian this week, is that some of the activities the soldiers were asked to engage in had more in common with the intelligence services of oppressive regimes than of a democracy.

Among allegations made in the statements are that:

• A significant proportion of the unit’s Palestinian objectives “are innocent people unconnected to any military activity. They interest the unit for other reasons, usually without having the slightest idea that they’re intelligence targets.” According to the testimonies those targets were not treated any differently from terrorists.

• Personnel were instructed to keep any damaging details of Palestinians’ lives they came across, including information on sexual preferences, infidelities, financial problems or family illnesses that could be “used to extort/blackmail the person and turn them into a collaborator”.

• Former members claim some intelligence gathered by the unit was not collected in the service of the Israeli state but in pursuit of the “agendas” of individual Israeli politicians. In one incident, for which no details have been provided, one signatory recalls: “Regarding one project in particular, many of us were shocked as we were exposed to it. Clearly it was not something we as soldiers were supposed to do. The information was almost directly transferred to political players and not to other sections of the security system.”

• Unit members swapped intercepts they gathered involving “sex talk” for their own entertainment.

The letter has been sent to the chief of staff of Israel’s armed forces and also the head of military intelligence.

Unit 8200 is one of the most prestigious in the Israeli public’s mind, with many who serve in it going on to high-flying jobs after their military service, many in Israel’s hi-tech sector.

According to an article this year in Haaretz, former unit members include a supreme court justice, the director general of the finance ministry, an internationally successful author, the chief executive of one of Israel’s largest accountancy firms and the economy ministry’s chief scientist.

Operating a signals interception base, the unit is also at the front of Israel’s cyberwar capabilities. According to some reports – never confirmed – it was involved in developing the Stuxnet virus used to attack Iran’s nuclear programme.

Most of those who signed the letter have served in the unit in the last decade – as recently as three years ago in full-time military service – with the majority still on the active reserve list, meaning they can be called up at any time.

All of those who spoke to the Guardian said they were “highly motivated” to join the unit and had volunteered to serve extra time in it beyond their national service.

Although there have been “refusenik” letters before – most famously more than a decade ago when a group of reserve pilots refused to participate in targeted assassinations – such detailed complaints from within Israel’s intelligence services are highly unusual.

Three of those involved, two sergeants and a captain who gave interviews to the Guardian and a handful of other foreign media before the letter was released this week, were at pains to make clear they were not interested in disclosing state secrets. They had engaged a high-profile lawyer to avoid breaking Israeli law – including by identifying themselves in public. Copies of the letter sent to their unit commander, however, use their full names.

Those involved told the Guardian they were proud of some of the work they had done, which they believed had contributed to Israel’s security.

In their interviews, they described a culture of impunity where soldiers were actively discouraged in training lessons from questioning the legality of orders, and of being deliberately misled by commanders about the circumstances of a case in which one member of their unit refused to cooperate in the bombing of a building with civilians in it in retaliation for an attack in Israel.

They added that there were in effect “no rules” governing which Palestinians could be targeted and that the only restraint on their intelligence gathering in the occupied territories was “resources”.

“In intelligence – in Israel intelligence regarding Palestinians – they don’t really have rights,” said Nadav, 26, a sergeant, who is now a philosophy and literature student in Tel Aviv. “Nobody asks that question. It’s not [like] Israeli citizens, where if you want to gather information about them you need to go to court.”

He said: “The intelligence gathering about Palestinians is not clean. When you rule a population that does not have political rights, laws like we have, [then] the nature of this regime of ruling over people, especially when you do it for many years, [is that] it forces you to take control or infiltrate every aspect of their life.”

“D”, a 29-year-old captain who served for eight years, added: “[That] question is one of the messages that we feel it is very important to get across mostly to the Israeli public.

“That is a very common misconception about intelligence … when we were enlisting in the military [we thought] our job is going to be minimising violence, minimising loss of lives, and that made the moral side of it feel much easier.”

He added: “What the IDF does in the occupied territories is rule another people. One of the things you need to do is defend yourself from them, but you also need to oppress the population.

“You need to weaken the politics. You need to strengthen and deepen your control of Palestinian society so that the [Israeli] state can remain [there] in the long term. We can’t talk about specifics … [but] intelligence is used to apply pressure to people to make them cooperate with Israel.

“It’s important to say, the reason I decided to refuse – and I decided to refuse long before the recent [Gaza] operation. It was when I realised that what I was doing was the same job that the intelligence services of every undemocratic regime are doing.

“This realisation was what made me [realise] personally that I’m part of this large mechanism that is trying to defend or perpetuate its presence in the occupied territories.”

The last major refusenik episode in Israel to grab the public’s attention was in 2002 when 27 reserve pilots published a letter refusing to fly assassination sorties over Gaza after 14 civilians, including children, were killed alongside Salah Shehade, the leader of Hamas’s military wing, in a bombing.

Nadav made a reference to the killing – and the outcry that surrounded it. “When you look at what happened this summer, when building after building were destroyed and the inhabitants and hundreds of innocent people were killed and no one raised an eyebrow, as opposed to just one decade ago when the killing of a family of a commander of Hamas shocked people. It was a huge story in Israel.”

Replying to the refusenik letter and the allegations, a spokesman for the Israel Defence Forces criticised the soldiers for making their complaints public, and attempted to cast doubt on the claims.

“The intelligence corps has no record that the specific violations in the letter ever took place. Immediately turning to the press instead of to their officers or relevant authorities is suspicious and raises doubts as to the seriousness of the claims.

“Regarding claims of harm caused to civilians, the IDF maintains a rigorous process which takes into account civilian presence before authorising strikes against targets.”