Board Thread:Theories and Speculation/@comment-3001903-20160813042916/@comment-25319479-20160829100725

Omnibender wrote: Ao knowing he had a mind-controlling genjutsu is one thing, knowing specifically it was a MS genjutsu is another. Even when the jutsu first appeared, we only listed it as Sharingan, because there was no talk of MS with it until Edo Itachi triggered it. I guess it's possible he could have seen Shisui's MS design from a distance, but not mentioning it was a MS when he caught Danzo used it seems rather odd. Kabuto was a highly trained spy, who probably only learned a lot of secrets after becoming loyal to Orochimaru, as Orochimaru was responsible for Danzo's various implant enhancements. "The mighty ability of his ‘Mangekyou Sharingan’ has attracted attention of not only the enemy nations, but the higher ups of the village as well" - DB4 It's safe to say the Konoha council was aware it was a MS technique, otherwise Danzo wouldn't have known to target his eye.