Covert influence, the new money laundering

Google is the most recent company known to have discovered evidence of Russian covert influence on its books. As more media companies realize Russia bought advertising space or promoted news stories, fake and otherwise, on their platforms, covert influence has become the new money laundering.

Both activities hide below the surface of legitimate enterprises, cast a shadow of disrepute on those very enterprises and can be neutralized through transparency and accountability.

Anti-money laundering laws provide useful lessons for combating covert influence and could be adapted for online media models that do not require users to be paid customers.

In the 20th century, the rise of organized criminal enterprises, like the Mafia and drug-smuggling cartels, led law enforcement officers and prosecutors to realize that investigating each murder, each coercion of a legitimate business and each drug shipment was an untenable and unsustainable investigative approach. Meanwhile, tax evasion was difficult to track and combat without documentation that held citizens accountable for their financial assets and earnings.

Government officials could not succeed against highly organized and sophisticated criminal activities simply by investigating and prosecuting each individual offense. They needed to track the flow of money, and create audit trails for the lifeblood that enabled these organizations and individuals to prosper.

For these reasons, anti-money laundering laws were created. In 1970, the Bank Secrecy Act required proper record-keeping, which officially made it illegal to conduct transactions “off the books.” In 1986, money laundering was designated a federal crime. And more recently, know-your-customer (or KYC) rules have required all financial institutions to verify the identity of their clients. These laws originated in the U.S., and have now been adopted in nearly 80 countries that want to disrupt illegal activities and do business with U.S. financial institutions.

Anti-money laundering laws have been successful in preventing criminals and terrorists from paying for goods and services with ease in the financial markets. Under these laws, nefarious actors have been relegated to using cash — which is significantly more cumbersome to transfer — or they risk leaving financial paper trails that can be presented to courtroom juries.

Social media benefits society by giving a voice and microphone to those who might otherwise be voiceless, but this same benefit becomes a liability in the hands of a sophisticated adversary.

The leak of more than 11 million financial and legal records in 2016, referred to as the Panama Papers, demonstrated the lengths people had gone to circumvent these laws and the power of transparency in holding wrongdoers responsible. The resulting paper trail has led to investigations in at least 79 countries.

If the way to combat money laundering is by shining a light on the source of funds, then the way to combat covert influence may be to shine a light on the source of messages in the media. Similar reforms to those implemented to prevent money laundering could be applied to prevent the abuse of media platforms.

Policymakers have begun exploring potential legislative options. For example, new legislation proposed in Congress would require online platforms with more than 50 million users to report who their advertisers are and reveal the targets of messaging campaigns. These requirements for online media are similar to existing regulations for TV and radio advertising.

 The evidence shows Russia bought ad space and also promoted certain fake, real and questionable news stories on FacebookTwitter and now Google. The specific stories and ads Russia promoted were associated with widening divisions within the American populace along racial divides, religious differences and political topics before and after the 2016 presidential election.
Michael Morell, former acting director of the CIA said earlier this year, “Putin wants to weaken the United States. Creating political turmoil here does that — it means we are not able to focus as we should on the important economic and national security issues facing the country, to include Russia’s malign behavior in the world.”

In online domains, users need not become paid advertisers to amplify messages; fake accounts and bots can do it without ad buys.


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