There are still a lot of unknowns about what went down behind closed doors, but the consensus is that OpenAI’s original board fired Altman because they thought he was building risky, potentially harmful tech in the pursuit of major profits. I’ve seen other media calling it a “failed coup”, which is the wrong way to understand what happened. Under the unique setup at OpenAI — which pledges to “build artificial general intelligence (AGI) that is safe and benefits all of humanity” — it is the board’s job to hold the CEO accountable not to investors or even to its employees, but rather to “all of humanity.” The board (alongside some current and former staff) felt Altman wasn’t holding up his end of the deal, so they did their job and showed him the door.

This was no coup. But it did ultimately fail. Even though Altman was part of the team that created this accountability structure, its rules apparently no longer applied to him. As soon as he left, his staff apparently threatened to quit en masse. Powerful people intervened and the old boss was back at the helm in time for Thanksgiving dinner. 

Now, OpenAI’s board is more pale, male and I dare say stale than it was two weeks ago. And Altman’s major detractors — Helen Toner, an AI safety researcher and strategy lead at Georgetown University’s Center for Security and Emerging Technology, and Tasha McCauley, a scientist at the RAND Corporation — have been shown the door. Both brought expertise that lent legitimacy to the company’s claims of prioritizing ethics and benefiting “all of humanity.” You know, women’s work. 

As esteemed AI researcher Margaret Mitchell wrote on X, “When men speak up abt AI&society, they gain tech opportunities. When non-men speak up, they **lose** them.” A leading scholar on bias and fairness in AI, Mitchell herself was famously fired by Google on the heels of Timnit Gebru, whose dismissal from Google was sparked by her critiques of the company’s approach to building AI. They are just a few of many women across the broader technology industry who have been fired or ushered out of powerful positions when they raised serious concerns about how technology might affect people’s lives.

I don’t know exactly what happened to the women who were once on OpenAI’s board, but I do know that when you have to do a ton of extra work simply to speak up, only to be shut down or shown the door, that’s a raw deal. 

On that note, who’s on Altman’s board now? Arguably, the biggest name is former U.S. Treasury Secretary Larry Summers, who used to be the president of Harvard University, but resigned amid fallout from a talk he gave in which he “explained” that women were underrepresented in the sciences because, on average, we just didn’t have the aptitude for the subject matter. Pick your favorite expletive and insert it here! Even though Summers did technically step down as president, the university still sent him off with an extra year’s salary. He has since continued to teach at Harvard, made millions working for hedge funds and become a special adviser at kingmaker venture capital firm Andreessen Horowitz. And now he gets to help decide the trajectory of what might be the most consequential AI firm in the world. That is a sweet deal.

The other new addition to the board is former Salesforce Co-CEO Bret Taylor, who was on the board of Twitter when it was still Twitter. There, Taylor played a major role in forcing Elon Musk to go through with his acquisition of the company, though Musk had tried to back out early in the process. This was good for Twitter’s investors and super terrible for everyone else, ranging from Twitter’s employees to the general public who had come to rely on the service as a place for news, critical debate and coordination in public emergencies. 

In Twitter’s case, there was no illusion about benefiting “all of humanity” — the board was told to act on investors’ behalf, and that’s what it did. It shows just how risky it is for us to depend on tech platforms run by profit-driven companies to serve as a quasi-public space. I worry that OpenAI will be next in line. And I don’t see this board doing anything to stop it.

GLOBAL NEWS

Thousands of Palestinians in the Israeli-occupied West Bank have been arrested since Oct. 7, some over things they’ve posted — or appear to have posted — online. One notable figure among them is Ahed Tamimi, a 22-year-old who has been a prominent advocate against the occupation since she was a teenager. Israeli authorities raided Tamimi’s home in early November and arrested her on accusations that she had written a post on Instagram inciting violence against Israeli settlers. The young woman’s family denied that Tamimi had posted the message, explaining that the post came from someone impersonating her, amid an online harassment campaign targeting the activist. Since her arrest, she has not been charged with any crime. On Tuesday, Tamimi’s name appeared on an official list of Palestinian detainees slated for release.

Israeli authorities have been quick to retaliate against anything that might look like antisemitic speech online — unless it comes from Elon Musk. The automotive and space-tech tycoon somehow managed to get a personal tour of Kfar Aza kibbutz — the scene of one of the massacres that Hamas militants committed on Oct. 7 — from no less than Prime Minister Benjamin Netanyahu himself this week. Just days prior, Musk had been loudly promoting an antisemitic conspiracy theory about anti-white hatred among Jewish people on X, describing it as “the actual truth.” Is Netanyahu not bothered by the growing pile of evidence that Musk is comfortable saying incredibly discriminatory things about Jewish people? As with Altman, the rules just don’t apply when you’re Elon Musk.

And there was a business angle for Musk’s visit to Israel. He has a habit of waltzing into cataclysmic crises and offering up his services. It’s always billed as an effort to help people, but there’s usually a thinly veiled ulterior geopolitical motive. While in Israel, he struck a deal that will allow humanitarian agencies in Gaza to use Starlink, his satellite-based internet service operated by SpaceX. Internet connectivity and phone service have been decimated by Israel’s war on Gaza, in which airstrikes have destroyed infrastructure and the fuel blockade has left telecom companies all but unable to operate. So Starlink could really help here. But in this case, it will only go so far. Israel’s communications ministry is on the other end of the agreement and has made it clear that access to the network will be strictly limited to aid agencies, arguing that a more flexible arrangement could allow for Hamas to take advantage. Journalists, local healthcare workers and just about everyone else will have to wait.

WHAT WE’RE READING

• A study by Wired and the Integrity Institute’s Jeff Allen found that when the messaging service Telegram “restricts” channels that feature right-wing extremism and other forms of radicalized hate, they don’t actually disappear — they just become harder to “discover” for those who don’t subscribe. Vittoria Elliott has the story for Wired.

• In her weekly Substack newsletter, crypto critic and Berkman Klein Center fellow Molly White offered a thoughtful breakdown of Silicon Valley’s “effective altruism” and “effective accelerationism” camps, which she writes “only give a thin philosophical veneer to the industry’s same old impulses.”

The post For OpenAI’s CEO, the rules don’t apply appeared first on Coda Story.

Since Hamas’s Oct. 7 assault on Israeli civilians, Hinkle has devoted himself to posting anti-Israel content on social media, particularly X. Nearly all of his posts are blatant falsehoods and manipulations. Recently, for instance, he claimed that Israeli authorities staged a scene for Elon Musk, who recently visited the country, with unfired bullets in a crib. It was soon pointed out, however, that the bullets had indeed been fired. Nevertheless, the tweet is still up. Hinkle doesn’t bother with deleting posts or taking them back after errors have been exposed. He just continues to post more — and it works. His audience impressions over the last month alone run into the billions.  

Before the Hamas attacks, Hinkle spread Russian propaganda about the war in Ukraine. “Putin has God on his side in his quest to defeat NATO satanists,” Hinkle posted on X back in July. While Hinkle no longer posts about Ukraine, he is still serving Russia’s interests. On Nov. 27, for instance, Hinkle faithfully reported that “Hamas has released a Russian-Israeli citizen as a ‘thank you’ to President Putin for supporting Palestine!” More generally, though, the war in Gaza is an opportunity for Hinkle to do what the Kremlin most wants — focus online attention on the West’s seemingly unreflecting and hypocritical support for Israel. 

Hinkle has become a leading figure in that strange, social media-based netherworld of conspiracy theorists who have moved seamlessly from raging (or rather fomenting rage) about Covid vaccines, to raging about U.S. support for Ukraine, to now raging about the war in Gaza.

According to Pekka Kallioniemi, a propaganda researcher from Finland, these issues are “part of the same disinformation package.” In 2022, Kallioniemi began Vatnik Soup, a website and series of tweets in which he exposed, often sardonically, people and organizations he saw as “vatniks,” or useful idiots who would parrot Kremlin talking points online.  

Often, he told me, it is the same people who spread disinformation about Covid and vaccines and then about Russia’s invasion of Ukraine, who are now spreading pro-Hamas disinformation. “Their style is distinctive,” Kallioniemi said, because they have so successfully adopted the Russian propaganda technique of “high volume and multichannel disinformation.”

Posting on X, Kallioniemi recently noted the rapid proliferation on TikTok of videos purporting to show that Russian troops had been dispatched to “help” Palestinians defend themselves. “This is of course not true,” he wrote. But it didn’t matter. The larger narrative purpose was served — Russia is an ally and friend to those bullied by the West. “October 7,” he said, “was a big win for the Kremlin. It took the attention completely off the invasion of Ukraine. You began almost immediately to hear about an unwillingness to fund Ukraine’s defense indefinitely and about the need for peace talks.”

It is to Russia’s benefit, he added, that deliberate disinformation about Israel be allowed to infect the global conversation. “There has been a coordinated effort,” Kallioniemi told me, “to lower people’s trust in the authorities and to weaken democratic functioning.” A low-trust society, as the U.S. has gradually become, is “very vulnerable to disinformation and deep-state conspiracies,” he said. The pandemic proved to be particularly fertile ground for conspiracy theories, giving fresh impetus to a narrative about a globalist elite plotting to take over the world. Globalist narratives tend to be antisemitic, with Jewish people accused of being loyal to supranational entities that enhance control over, say, international banking or the media. In 2020, a study commissioned in the U.K. revealed that antisemitic content was rife in 79% of 27 leading anti-vaccine forums. 

The only long-term fix, Kallioniemi said, is education. “What Finland gets right,” he told me, “is that media literacy, critical thinking and checking sources are introduced very early. Even in pre-school, there is some understanding of the concept of disinformation and its impact.”        

Sometimes, though, education and critical thinking are not strong enough to withstand emotion and ideology. Jewish groups have long claimed that antisemitic disinformation is rampant on American university campuses. Some of these groups have just filed a lawsuit against the University of California, Berkeley for enabling “unchecked” antisemitism. If Russian propaganda about Gaza, spread by the likes of Hinkle, is finding an audience, it is because it cleverly exploits existing tensions.  

Dublin’s disinformation riots

Even broad educational achievements and moderate politics can fail to make societies immune to disinformation, as Ireland discovered last week. On Nov. 23, three young children and their teacher were stabbed in Dublin. Far-right groups called for young men to descend onto the scene of the crime, claiming that the stabbings had been committed by an illegal immigrant. The crowd quickly became violent, smashing storefronts and setting police vehicles and buses on fire. It took the police by surprise and hours elapsed before the riot was brought under control. The authorities quickly assigned blame to a far-right faction that they said had been “radicalized” online. It turned out that the attacker was an immigrant, an Algerian who had lived in Ireland for 20 years and was an Irish citizen. For what it’s worth, he was prevented from doing further damage by a much more recent immigrant, a Brazilian delivery driver who knocked him to the ground with his motorcycle helmet. 

If the rioting was shocking, disinformation experts argue that it could have been anticipated. Eileen Culloty, a professor in the communications department at Dublin City University, has written that “the COVID-19 pandemic marked a major turning point for disinformation in Ireland as various conspiracy theorists, anti-establishment actors, and, in particular, right-wing and far-right extremists mobilized online and offline.” Anger over lockdowns and vaccines curdled into anger over immigration, as Ireland took in a disproportionate number of refugees from Ukraine in addition to record numbers of asylum seekers. Contributing to the anger were a housing crisis, a cost-of-living crisis and the belief that local people were being cut off from benefits and forced to compete for scarce resources. Over the last year, there have been a number of protests. Inevitably, the social frustration has been amplified by deliberate and targeted disinformation on social media, including from X owner Elon Musk. As Irish Prime Minister Leo Varadkar called after the riots for new legislation to deal with hate speech, Musk weighed in. “Ironically,” he posted, “the Irish PM hates the Irish people.” Not the first time Musk has aligned himself with right-wing xenophobes. Varadkar’s father, incidentally, was an Indian-born doctor.

Rise of the trolls

And speaking of right-wing xenophobes: Dutch politician Geert Wilders is poised to form a coalition government in the Netherlands, after his party’s surprising success in snap elections earlier this month. If he can persuade anyone to work with him, that is. It is likely to prove challenging because in his public comments about Muslims in particular, Wilders can sound like an internet troll. He says his leadership style will be less confrontational, that he will be a prime minister for all Dutch people. Though he has yet to get the top job, his election success has already been celebrated by his far-right counterparts across Europe, including Hungary’s Viktor Orbán and France’s Marine Le Pen. He has also received acclaim from fellow Islamophobes in India. Last year, Wilders became a hero for Hindu nationalists when he defended Nupur Sharma, at the time a confident, abrasive spokesperson for the governing Bharatiya Janata Party. Sharma had appeared on a television debate show and made unprintably offensive remarks about the Prophet Muhammad and his third wife, a child bride, which provoked violent demonstrations in India and a diplomatic backlash from important trading partners such as Saudi Arabia, Kuwait and the UAE. The BJP ultimately suspended Sharma, but Wilders described her as a “hero who spoke nothing but the truth.” He added that “Hindus should be safe in India. It is their country, their homeland, it’s theirs! India is no Islamic nation.” It’s a sentiment that has won Wilders friends for life among Hindu nationalists in India, however rooted his words are in disinformation and conspiracy theory. 

WHAT WE’RE READING:

• Foreign-born media owners are not unheard of in the U.K., including Rupert Murdoch and Evgeny Lebedev, the son of a former KGB spy. So why is it causing such consternation that a consortium led by former CNN boss Jeff Zucker and funded largely by the vice president of the UAE, Sheikh Mansour bin Zayed Al Nahyan, is seeking to buy conservative broadsheet The Telegraph? Surely there is something concerning when a senior member of the autocratic government of a country not known for encouraging the free press finances the takeover of a national newspaper in another country? The soft power benefits to the UAE seem obvious, but what will the consequences be for The Telegraph?
• “Across Ukraine at least two dozen Pushkin statues have been removed from their pedestals since the war began,” writes Thomas de Waal in Englesberg Ideas. Given that the 19th-century poet, novelist and dramatist is considered to be Russia’s “national writer,” de Waal adds, “take down Pushkin’s statue and you are challenging Russia as a whole.” This excellent essay makes a compelling case for the need to emancipate rather than fetishize Russian literature.

The post Russian propagandists turn their attention to Gaza appeared first on Coda Story.

Nearly anyone can be silenced. On Nov. 9, the leading German daily Süddeutsche Zeitung denounced Indian art critic Ranjit Hoskote for signing an open letter in 2019 that described Zionism as a “racist ideology calling for a settler-colonial, apartheid state where non-Jews have unequal rights.” 

Hoskote was of interest to the German media because he sat on a search committee tasked with appointing the next art director for Documenta. Founded in 1955, Documenta is an internationally significant exhibition of contemporary art held every five years in the historic city of Kassel in central Germany. Within days of the newspaper’s article, Hoskote resigned. Documenta had precipitated his resignation by publicly declaring that his conduct in signing the letter four years ago “was not remotely acceptable” because of its “explicitly anti-Semitic content.”

Even before Hoskote resigned, the Israeli artist Bracha L. Ettinger stepped down from the search committee, citing her inability to continue to participate, describing the feeling of being “paralyzed under rockets, with the details of the massacre committed by Hamas against Israeli civilians, women, and babies, and of the kidnapping of children and babies and civilians, being streamed on my screen during our lunch and coffee breaks.” Though the allegations against Hoskote were public by the time Ettinger resigned, she said they had nothing to do with her decision.

In the wake of both resignations, the remaining four members of the search committee stepped down last week. “In the current circumstances,” they wrote, “we do not believe that there is a space in Germany for an open exchange of ideas.” Intellectual discourse in Germany, they argued, was falling prey to “over-simplification and prejudgments.” Hoskote defended himself in his own lengthy resignation letter. “I feel, strongly,” he said, “that I have been subjected to the proceedings of a kangaroo court.”

Documenta is particularly sensitive to any association with antisemitism because the 2022 edition, intended to foreground perspectives from the Global South, was mired in controversy before the exhibition even opened. An Indonesian collective included caricatures on a 60-foot-long painted banner that the Israeli embassy in Germany said was “Goebbels-style propaganda.” One of the figures on the banner was a soldier with a pig’s head. He wore a Star of David bandana around his neck and a helmet with the word “Mossad” on it, the name of Israel’s intelligence service. In addition, the curators of the exhibition had reportedly not invited any Jewish or Israeli artists to participate. Seven academics conducted an inquiry into events at Documenta, concluding that the exhibition was “an echo chamber for Israel-related antisemitism, and sometimes for pure antisemitism.” 

Keen to avoid a repeat of the 2022 scandal, Documenta urged Hoskote to distance himself from the letter. Instead, he chose to resign, claiming he was “being asked to accept a sweeping and untenable definition of anti-Semitism that conflates the Jewish people with the Israeli state.”

What happened at Documenta mirrors similarly anguished resignations around the world, including within the media. The question we seem unable to answer collectively is this: When does free speech curdle into unacceptable, even hateful speech?

The open letter that Hoskote signed in 2019 condemned an event being held at the Israeli consulate in Mumbai that celebrated the shared purpose of Zionism and Hindutva, the aggressive Hindu nationalist ideology embraced by India’s Prime Minister Narendra Modi. Hindutva is usually traced back to the early 1920s and the ideas of V.D. Savarkar, an admirer of Nazi Germany.  Just as Savarkar saw Germany as an example of how to deal with minorities, so his Hindutva descendants now see Israel.

Modi’s Hindu nationalist supporters identify closely with Israel, believing that they share a common enemy in Islamist terrorism. Israel, in their view, is a model for a future Hindu nation in which minorities, particularly Muslims, will have to know their place. This attitude has turned India’s traditional support for Palestine on its head. On social media, Hindutva supporters have been at the forefront of spreading Islamophobic and anti-Palestinian disinformation. Police in India have also been quick to arrest pro-Palestinian protestors, with as many as 200 students detained at a single protest in Delhi last month. In the Muslim-majority state of Kashmir, the government banned all expressions of pro-Palestinian protest.

Free speech, and the right to offer your opinion, however contested, did not apply to either Hoskote or the pro-Palestinian protesters arrested in Delhi. Instead, they were silenced by a narrative that brooks no departures from the ruling party line — whether in Germany or in India.  

Argentina’s AI election

With elections in the United States and India scheduled next year, Argentina’s recently concluded two-part presidential election offers a dire prognosis — expect artificial intelligence to feature prominently. Both candidates in the run-off, Javier Milei (the eventual winner) and Sergio Massa, used AI technology to generate campaign propaganda. Some of this material was satirical, mocking and stylized, but plenty of it was also misleading. The potential is there to fabricate entirely convincing deep fakes in which a person’s image and voice can be manipulated to say and do things they have never said or done.

Should all AI-generated images now carry a disclaimer? Meta, whose social media sites Facebook and Instagram are major platforms for digital advertising, says that from next year it will require advertisers to declare if and how they’ve used AI. Meta also said it would bar political campaigns and advertisers from using Meta’s generative AI technologies.

Massa’s communications team told The New York Times that their use of AI was strictly intended as entertainment and was clearly labeled. But is the point of AI-generated content not to persuade voters that particular images are real? I’m not sure. I think what draws political campaigns to AI is the volume and variety of messages that can be created. The ease with which images are proliferated at scale means that voters will be provided with a carefully constructed picture of candidates and their rivals — one in which fiction is impossible to separate from fact.

Russia jails yet more critics

With so much of the media’s focus on Gaza, the Kremlin can get on with the business of jailing its critics in relative obscurity. Too little attention was paid to the conviction of Sasha Skolichenko, an artist who was arrested last year for swapping out price tags in supermarkets with anti-war messages. She was arrested just a month after Russia passed a law criminalizing any public comment on the war that contradicted the official narrative. On Nov. 16, Skolichenko was sentenced to seven years in prison. “Everyone sees and knows that it’s not a terrorist you’re trying,” she told the judge. “You’re trying a pacifist.” Since the new law came into effect, nearly 20,000 Russians have been arrested for protesting against war in Ukraine.

Just yesterday, a court in Moscow issued a warrant for the arrest of Nadezhda Tolokonnikova, a founding member of Pussy Riot, the feminist punk rock protest group. She is reportedly not in Russia right now and at least temporarily safe from the long arm of the Kremlin. Tolokonnikova spent nearly two years in a Russian prison back in 2012 for breaking into a Moscow cathedral as part of an anti-Putin protest. The crime Tolokonnikova is now accused of committing seems practically invented for Pussy Riot — “insulting believers’ religious feelings.” 

WHAT WE’RE READING:

• The Washington Post has been doing some terrific reporting out of India, shedding light on the contours of India’s increasingly undemocratic shape. In this recent dispatch, Gerry Shih and Anant Gupta ask industry insiders about Netflix and Amazon preferring to self-censor and pull out of politically and religiously sensitive projects rather than risk annoying the Hindu nationalist government and their fervent online troll army.

• There’s one more resignation letter that merits mention this week, and that comes from Anne Boyer. The now-former poetry editor of The New York Times Magazine writes that she would rather resign than continue to work alongside “those who aim to acclimatize us to this unreasonable suffering.” “No more ghoulish euphemisms,” she writes about the coverage of Gaza. “No more warmongering lies.” 

The post Stamping out hate speech or stifling free speech? appeared first on Coda Story.

When people become displaced en masse, organizations like the U.N., with its World Food Program and refugee agency, will often step in to help. But today, sometimes before they distribute food or medicine, they typically collect refugees’ data. Fingerprinting, iris scans and even earlobe measurements are now a common requirement for anyone seeking to meet their basic needs.

This week I caught up with Zara Rahman, a tech and social justice researcher who studies the drive across international humanitarian and intergovernmental organizations like the U.N. and the World Bank to digitize our identities.

“Of course, U.N. agencies are trying to figure out how much food and what resources we need,” Rahman told me. But “the amount of information that is being demanded and collected from people in comparison to what is actually needed in order to provide resources is just wildly different.” 

In “Machine Readable Me: The Hidden Ways Tech Shapes Our Identities,” her new book on the global push to digitize our lives, Rahman looks at the history of data collection by governments and international agencies and what happens when their motives change or data falls into the wrong hands. Nazi Germany is a top pre-digital case study here — she has a great passage about how members of the Dutch resistance bombed Amsterdam’s civil registry office during World War II to prevent Nazis from using the registry to identify and persecute Jews.

She then leaps forward to Afghanistan, where U.S. occupying forces deployed data collection systems that were later seized by the Taliban when they skated back into power in 2021. These databases gave Taliban leadership incredibly detailed information about the lives of people who worked for the U.S. government — to say nothing of women, whose lives and opportunities have been entirely rewritten by the return to Taliban rule. We may never know the extent of the damage incurred here.

Data collection and identity systems are also used, or could potentially be used, to persecute and victimize people whose nationality is contested, like many of those being expelled right now from Pakistan. Rahman emphasized that what happens to these people may depend on who the state perceives them to be and whether they are seen as people who “should return to Pakistan at some point.” 

Rohingya Muslims, she reminded me, were famously denied citizenship and the documentation to match by the Myanmar government for generations. Instead, in the eyes of the state, they were “Bengalis” — an erroneous suggestion that they had come from Bangladesh. In 2017, hundreds of thousands of Rohingya people fled the Burmese military’s ethnic cleansing operations in western Myanmar and landed in Bangladesh, where the government furnished them with IDs saying that they were from Myanmar, thereby barring them from putting down roots in Bangladesh. In effect, both countries leveraged their identity systems to render the Rohingya people stateless and wash their hands of this population. 

What recourse do people have in such circumstances? For the very rich, these rules don’t apply. People with deep pockets rarely find themselves in true refugee situations, and some even purchase their way to citizenship — in her book, Rahman cites a figure from Bloomberg, which reported that “investor-citizens spent $2 billion buying passports in 2014.” But most of the tens of millions of people affected by these systems are struggling to survive — the financial and political costs of litigating or challenging authorities are totally out of bounds. And with biometric data a part of the package, the option of slipping through the system or somehow establishing yourself informally is too. Your eyes are your eyes and can be used to identify you forever.

GLOBAL NEWS

Facial recognition tech is a key tool in China’s campaign against ethnic Uyghurs. This isn’t news, but the particular ways in which Chinese authorities deploy such tools to persecute Uyghur people, most of whom are Muslim, continue to horrify me. It came to light recently that Hikvision, the popular surveillance camera maker that offers facial recognition software, won a state contract in 2022 to develop a system that conducts “Assisted Analysis Of Ethnic Minority Students.” It’s worth noting that Hikvision in the past has boasted of its cameras’ abilities to spot “Uyghur” facial features, a brag that helped the technology get blacklisted in the U.S. But while you can’t buy it here, it’s pretty common across Asia, Africa and even in the U.K. The recently leaked tenders and contracts, published on IPVM, show that the company developed tools that alerted Chinese authorities about university students who were “suspected of fasting” during Ramadan, as well as monitored travel plans, observation of holidays and even things like what books ethnic minority students checked out at the library. Paging George Orwell.

Israel is also doubling down on facial recognition and other hardcore surveillance tech, after its world-renowned intelligence system failed to help prevent the deadly attacks of October 7. In the occupied West Bank, Palestinians report their daily movements are being watched and scrutinized like never before. That’s saying a lot in places like the city of Hebron, which has been dotted with military checkpoints, watchtowers and CCTV cameras — some of which are supplied by Hikvision — for years now. In a dispatch this week for Wired, Tom Bennett wrote about the digital profiling and facial recognition surveillance database known as Wolf Pack that allows the military officers to pull up complex profiles on all Palestinians in the territory, simply by scanning their faces. In a May 2023 report, Amnesty International asserted that whenever a Palestinian person goes through a checkpoint where the system is in use, “their face is scanned, without their knowledge or consent.”

Some of the world’s most powerful tech companies are either headquartered or present in Israel. So the country’s use of technology to surveil Palestinians and identify targets in Gaza is a burning issue right now, including for engineers and tech ethics specialists around the world. There’s an open letter going around, signed by some of the biggest names in the responsible artificial intelligence community, that condemns the violence and the use of “AI-driven technologies for warmaking,” the aim of which, they write, is to “make the loss of human life more efficient.” The letter covers a lot of ground, including surveillance systems I mentioned above and Project Nimbus, the $1.2 billion deal under which Amazon and Google provide cloud computing services to the Israeli government and military. Engineers from both companies have been advocating for their employers to cancel that contract since it first became public in 2021. 

The letter also notes the growing pile of evidence of anti-Palestinian bias on Meta’s platforms. Two recent stand-out examples are Instagram’s threat to suspend the account of acclaimed journalist Ahmed Shihab-Eldin over a video he posted that showed Israeli soldiers abusing Palestinian detainees, and the shadowbanning of digital rights researcher Mona Shtaya after she posted a link to an essay she wrote for the Middle East Institute on the very same issue. Coincidence? Looking at Meta’s track record, I very much doubt it.

WHAT WE’RE READING

• I’ve written a few times about how police in the U.S. have misidentified suspects in criminal cases based on faulty intel from facial recognition software. Eyal Press has a piece on the issue for The New Yorker this week that asks if the technology is pushing aside older, more established methods of investigation or even leading police to ignore contradictory evidence.
• Peter Thiel is taking a break from democracy — and he won’t be bankrolling Trump’s 2024 presidential campaign. Read all about it in Barton Gellman’s illuminating profile of the industry titan for The Atlantic.

The post Fleeing war? Need shelter? Personal data first, please appeared first on Coda Story.

Inevitably now, these stories are about death and displacement. Last month, Mahmoud al-Naouq, the 25-year-old brother of “We Are Not Numbers” co-founder Ahmed al-Naouq, was killed, along with several other members of his family. Mahmoud had just received a scholarship to go to graduate school in Australia. Al-Naouq is hardly the only local journalist in mourning. A correspondent for Al Jazeera was on the air when he heard that his wife, 7-year-old daughter, teenage son and baby grandson had all been killed in an Israeli airstrike. He is filmed, in tears, standing over his dead son’s body. “I suppose I should thank God,” he says, “that at least some of my family survived.”

Among the thousands of people who have been killed in Gaza are dozens of journalists. The Committee to Protect Journalists says 42 journalists and media workers have been killed (as of Tuesday, November 14) during this conflict, 37 of them Palestinian. The CPJ says these numbers are unprecedented since it began keeping such records in 1992. Just as Israel is paying little heed to civilian casualties in Gaza in the course of its stated mission to obliterate Hamas, it refuses to take responsibility for killing journalists. The Israeli Defense Forces told major news wires including Reuters and Agence France-Presse that it could not guarantee the safety of their employees in Gaza. In fact, not only are authorities in Israel not guaranteeing the safety of journalists, they have been conflating journalists with terrorists.

Israeli government officials have openly claimed that Gazan journalists are siding with Hamas and are therefore legitimate targets. On X, Benny Gantz, a former defense minister of Israel and currently part of the country’s wartime cabinet, posted that journalists who knew “about the massacre, and still chose to stand as idle bystanders while children were slaughtered — are no different than terrorists and should be treated as such.” 

Based on scanty and circumstantial evidence, a pro-Israel media watchdog accused photojournalists who have worked for the wire services, as well as The New York Times and CNN among others, of having prior knowledge of the October 7 attacks. One of these journalists, Hassan Eslaiah, has found himself singled out. In 2020, he posted a photograph of him being kissed by a Hamas leader believed to have masterminded the October 7 attacks. Eslaiah also took some of the earliest photographs of the Hamas attacks. Both the Associated Press and CNN had used Eslaiah’s photographs but now said they would no longer work with him. “While we have not at this time found reason to doubt the journalistic accuracy of the work he has done for us, we have decided to suspend all ties with him,” said CNN in a statement. 

What evidence Israel has to denigrate and doubt the integrity of the journalists they threaten may be unclear. But what is clear is that it will be left to the consciences of individual journalists to stick up for their Gazan colleagues. 

About 900 journalists have signed an open letter dated November 9 that declares their support for journalists in Gaza. “Without them, many of the horrors on the ground would remain invisible.” The letter writers, “a group of U.S.-based reporters at both local and national newsrooms,” note that “taken with a decades-long pattern of lethally targeting journalists, Israel’s actions show wide scale suppression of speech.” This suppression is abetted, the writers contend, by “Western newsrooms accountable for dehumanizing rhetoric that has served to justify ethnic cleansing of Palestinians.”  

In 1982, Palestinian American intellectual Edward Said wrote about “those who go on sanctimoniously about terrorism and are silent when it comes to Israel’s almost apocalyptic state terrorism.” Over 40 years later, almost nothing has changed when it comes to the mainstream Western media’s coverage of the conflict. As Israel flattens Gaza, the Western media ties itself in semantic knots — insisting, for instance, on using phrases such as “Hamas-run health ministry” to shroud casualty figures in doubt or worse, to do Israel’s job for it by associating all residents of Gaza with terrorism. It is, as the letter writers put it, “journalistic malpractice” to fail or refuse to tell the whole story. The people who are best able to tell the story and whose voices are so rarely prioritized are in Gaza, silenced by both Israeli brutality and Western media outlets still unable to shake their biases and narrative tropes.

Ukraine’s forgotten children

Russia’s notorious children’s rights commissioner, Maria Lvova-Belova, has been inviting foreign journalists from the United States, Finland and Japan to visit camps in which thousands — possibly hundreds of thousands — of abducted Ukrainian children are held. In March, the International Criminal Court put a warrant out for Lvova-Belova’s arrest, alongside that of her boss, Vladimir Putin, for unlawful deportation of children, a war crime. But this has yet to stop them. And now they’re putting the children on display. A documentary that recently aired on British television showed how the children were often duped into thinking they were being taken to a holiday camp and then subjected to “re-education,” including being told to speak only Russian and singing patriotic Russian songs in front of inspectors. 

Attempts to portray life at these camps as idyllic will strike most viewers as obvious propaganda, but Lvova-Belova is not giving up trying to persuade us otherwise. In social media posts — which my colleague Ivan Makridin translated for me — she recently described the meeting between the journalists and the children as a “mentorship” opportunity. The young Ukrainians apparently asked their foreign visitors what they thought of the camp. “I like it very much,” Lvova-Belova quotes a Japanese journalist as saying. “I think your faces are all beautiful, cheerful and happy.”

When you know you are meeting children who are being held captive and who are not speaking freely while the press officer is in the room, why go through with it? While I understand the journalistic impulse of wanting to see the camps and meet the children, I find the ethics of agreeing to go on a guided tour dubious. Especially when Lvova-Belova is going to twist your presence into “proof” that these children are somehow better off at a camp in Russia than with their families. Back in May, Coda’s editor-in-chief Natalia Antelava criticized Vice for agreeing to interview Lvova-Belova and failing to hold her to account. Instead, Antelava wrote, Vice gave Lvova-Belova and the Kremlin “a platform to spin and legitimize their narrative.” This latest invitation to foreign journalists looks like more of the same.

India’s creepy deep fakes

Last week, a Bollywood film star’s face was attached to another woman’s body in a salacious deep fake that went viral. It caused outrage, at least in part because of how convincing the video was and how easy it now seemed to use generative artificial intelligence to spread mischievous misinformation. Celebrities, the government and national newspaper editors made public calls for draft legislation that would punish the creators of fake videos. But that’s easier said than done — defining “fakeness” under the law is harder than it sounds — and any law attempting to rein in this kind of material could pave the way for government overreach. It could also add fuel to the Indian government’s case against end-to-end encryption, since this kind of technology could help mask the identities of people creating deep fakes. If this should come to pass, the pitfalls for privacy and opportunities for mass surveillance will be significant, and could have much more profound effect on many more millions of people than a handful of salacious videos have had.

WHAT WE’RE READING:

• I enjoyed this lengthy meander through the origins of machine-generated text by the academic Richard Hughes Gibson. In the 1960s, Gibson reveals, the author Italo Calvino was already prepared to concede that the “literature machine” might match or outdo the human writer. What the machine couldn’t do, though, was replicate the reader and the particularity the reader brings to the text — the sudden associations and minor epiphanies. “Calvino,” writes Gibson, “anticipated the urgent question of our time: Who will attend to the machines’ writing?”
• The International Olympic Committee is hopping mad. A slick four-part Netflix documentary, narrated by Tom Cruise no less, reveals that corruption within the IOC is destroying the Olympics. Except, the “documentary” is fake: Cruise’s voiceover is AI generated and no such program can be found on Netflix. The nine-minute episodes were uploaded onto a largely Russian language-dominated Telegram channel, which unlike YouTube has not taken the videos down. Is it a coincidence that they started emerging after the IOC banned the Russian Olympic Committee for its decision last month to recognize regional federations in occupied regions such as Kherson and Donetsk? This inquiring mind wants to know.

The post Gaza’s journalists, caught between bombs and disinformation appeared first on Coda Story.

Consider the subject of terrorism. The biggest players all have rules against content that comes from terrorist groups or promotes their agendas, many of which align with national laws. This might sound uncomplicated, but the governing entity in Gaza, for instance, is Hamas, a designated terror organization in the eyes of Israel and, even more importantly, the U.S., home to the biggest tech companies on earth. Digital censorship experts have expressed well-founded fears that between Big Tech’s self-imposed rules and regional policies like the EU’s Digital Services Act, companies could be censoring critical information such as evidence of war crimes or making it impossible for people in the line of fire to access vital messages.

Although the stakes here couldn’t be higher, we also know that content moderation work is too often relegated to tiny teams within a company or outsourced to third parties.

Companies are typically coy about how this works behind the scenes, but in August the Digital Services Act went into effect, requiring the biggest of the Big Techs to periodically publish data about what kinds of content they’re taking down in the EU and how they’re going about it. And last week, the companies delivered. The report from X showed some pretty startling figures about how few people are on the front lines of content moderation inside the company. It’s been widely reported that these teams were gutted after Elon Musk took over a year ago but I still wasn’t prepared for the actual numbers. The chart below shows how many people X currently employs with “linguistic expertise” in languages spoken in the EU.

X has expertise on fewer than half of the bloc’s official languages, and for most of them, it employs literally one or two people per language. The languages with teams in the double digits are probably explained by a combination of regulation, litigation and political threats that have tipped the scales in places like Germany, Brazil and France. But for a company with this much influence on the world, the sheer lack of people is staggering.

Industry watchers have jumped all over this. “There is content moderation for the English-speaking world, which is already not perfect, and there is the Digital Wild West for the rest of us,” wrote Roman Adamczyk, a network analyst who previously worked with the Institute for Strategic Dialogue. “Will this change in light of the 2024 elections in Finland, Lithuania, Moldova, Romania and Slovakia?” asked Mathias Vermeulen, director of the privacy litigation group AWO. Great question. Here are a few more, in no particular order:

What are people who speak Hungarian or Greek — of which there are about 13 million each in the EU — supposed to make of this? What about all the places in the EU where the Russian language has a big presence, sometimes of the fake news variety? What happens if the sole moderator for Polish gets the flu? Is there any recourse if the two moderators for Hebrew, whose jobs I seriously don’t envy right now, get into an argument about what counts as “terrorist” content or “incitement to violence”? These moderators — “soldiers in disguise” on the digital battlefield, as one Ethiopian moderator recently put it to Coda — have serious influence over what stays up and what comes down.

After reading accounts from moderators working through Ethiopia’s civil war, I shudder to think of what these staffers at X are witnessing each day, especially those working in Arabic or Hebrew. The imperative to preserve evidence of war crimes must weigh heavily on them. But ultimately, it will be the corporate overlords — sometimes forced by the hands of governments — who decide what gets preserved and what will vanish.

GLOBAL NEWS

Elon Musk has once again been taking potshots at the world’s largest online encyclopedia. Two weeks back, he poked fun at the Wikimedia Foundation’s perennial donation drive and then jokingly considered paying the foundation $1 billion to change the platform’s name to — so sorry — “Dickipedia.” It is hard to know where to begin on this one, except to say that while Wikipedia functions on a fraction of the budget that X commands, it takes things like facts and bias a lot more seriously than Musk does and supports 326 active language communities worldwide. In the meantime, Wikipedia’s fate in the U.K. still hangs in the balance. Regulators are sorting out the implementation of the country’s new Online Safety Act, which will require websites to scan and somehow remove all content that could be harmful to kids before it appears online. There’s a lot wrong with this law, including the fact that it will inspire other countries to follow suit.

One recent copycat is Sri Lanka, where the parliament is now considering a bill by the same name. Although proponents say they’re trying to help protect kids online, Sri Lanka’s Online Safety Bill treads pretty far into the territory of policing online speech, with an even broader mandate than its British counterpart. One provision aims to “protect persons against damage caused by communication of false statements or threatening, alarming or distressing statements.” Another prohibits “coordinated inauthentic behavior” — an industry term that covers things like trolling operations and fake news campaigns. A committee appointed by Sri Lanka’s president gets to decide what’s fake. Sanjana Hattotuwa, research director at the New Zealand-based Disinformation Project, has pointed out the clear pitfalls for Sri Lanka, where digital disinfo campaigns have been a hallmark of national politics for more than a decade. In an editorial for Groundviews, Hattotuwa argued that the current draft will lead to “vindictive application, self-serving interpretation, and a license to silence,” and predicted that it will position political incumbents to tilt online discourse in their favor in the lead up to Sri Lanka’s presidential election next year.

Greek lawmakers pushed through a ban on spyware last year, after it was revealed that about 30 people, including journalists and an opposition party leader, were targeted with Predator, a mobile surveillance software made by the North Macedonian company Cytrox. But efforts to get to the bottom of the scandal that started it all — who bought the spyware, and who picked the targets? — have been stymied, thanks in part to the new conservative and far-right elements in parliament. The new government has overhauled the independent committee that was formed to investigate the spyware scandal, in what opposition lawmakers called a “coup d’etat.” And now two of the committee’s original members are being investigated over allegations that they leaked classified information about the probe. When it comes to regulating — in this case, banning — spyware, EU countries probably have the best odds at actually making the rules stick. But what’s happened in Greece over the last 18 months shows that it’s still an uphill battle.

WHAT WE’RE READING

• Wired’s Vittoria Elliott has a new report on the rise of third-party companies that provide what’s known in the tech industry as “trust and safety” services. A key takeaway of the piece is that when companies outsource this kind of work, it means they’re “outsourcing responsibilities to teams with no power to change the way platforms actually work.” That’s one more thing to worry about.
• Beloved sci-fi writer and open internet warrior Cory Doctorow brought us a friendly breakdown this week of some really important legal arguments being made around antitrust law and just how harmful Amazon is to consumers and sellers alike. In a word, says Doctorow, it is “enshittified.” Read and learn.

The post Wartime in the ‘digital wild west’  appeared first on Coda Story.

In the last incarnation of this newsletter, Coda’s editor-in-chief Natalia Antelava worked each week to examine the disinformation being generated around Russia’s invasion of Ukraine. Deliberate distortion of the truth had long been a weapon in Vladimir Putin’s arsenal, but the war laid bare just how ineffective we were at countering it. Fact-checking alone is of little use in the face of targeted lies intended to sow division and advance particular narratives. 

We relaunch now as the war in Gaza appears to have destroyed any lingering optimism about citizen journalism, open-source intelligence and the free flow of information helping to dispel disinformation rather than be hijacked by bad actors. In this newsletter, we will continue to scrutinize narratives and the way information is deployed by people in power.

I’m based in New Delhi, which is fast becoming one of the disinformation capitals of the world. We will be watching India closely, but the Coda team is scattered around the globe — in Rome, Istanbul, London, Washington, D.C. and beyond. The patterns of misinformation we will examine here are global as are their impacts.

The online discourse is dominated by unreliable narrators as never before. 2024 is an election year in India and the United States, and sophisticated disinformation is likely to play major roles in both. Understanding and shedding light on how narrative is manipulated and why is work we all have to be prepared to do.

Why India is awash with anti-Palestine disinformation

Talk of unreliable narrators brings us with a sad inevitability to India’s Hindu nationalist troll army. On Sunday, October 29, near the coastal city of Kochi in the southern state of Kerala, a meeting of Jehovah’s Witnesses was bombed. Three people died and more than 50 were injured. 

Almost immediately, Hindu nationalists — including those within India’s governing Bharatiya Janata Party — went online to cast blame. At the time the bomb went off in Kerala, the state’s chief minister was in Delhi at a protest to express solidarity with Palestine — India’s traditional position, albeit one that is now contrarian because the BJP stands firmly with Israel. Rajeev Chandrasekhar, a minister in Prime Minister Narendra Modi’s cabinet, wrote on X that the Kerala chief minister’s “shameless appeasement politics” meant he was “sitting in Delhi and protesting against Israel, when in Kerala open calls by Terrorist Hamas for Jihad is causing attacks and bomb blasts on innocent Christians.” Chandrashekhar, despite his important role as a government minister, seemed to have no qualms speculating about the Kochi bombing and assigning guilt. 

Kerala is governed by a left-wing coalition, making it a favorite target of Hindu nationalist scorn. Amit Malviya, head of the BJP’s National Information and Technology department, followed his party colleague’s lead. The Kerala chief minister “seems more worried about Israel defending itself against Hamas, a terrorist group,” wrote Malviya, than Christians being attacked in Kochi. Alongside the BJP bigwigs, a chorus of Hindu nationalists made their feelings clear.  

The day before the bombings, in another part of Kerala, a pro-Palestine rally had been held. Khaled Mashal, the former head of Hamas, addressed the crowd virtually from his home in Qatar. “Together,” he said, “we will defeat the Zionists.” Posting a video of the rally on X, a popular Hindu nationalist account drew a link with the bombing of the Jehovah’s Witness meeting. “Jews are targeted,” the account claimed falsely. “Do we even need an inquiry to know who did it???” Of course, Jehovah’s Witnesses are not Jewish and, as it turned out, the Kochi bombing had nothing to do with Muslims, much less Hamas. 

A former Jehovah’s Witness confessed on Facebook and then to the Kerala police that he was behind the bombings. The police are currently verifying his claims. But Chandrasekhar, the cabinet minister, doubled down. Quoting former U.S. Secretary of State Hillary Clinton, he wrote on X: “You can’t keep snakes in your backyard and expect them only to bite your neighbors. You know, eventually those snakes are going to turn on whoever has them in the backyard.” In 2011, Clinton warned the Pakistani government about harboring terrorist networks. Chandrasekhar used her words to argue that “appeasement politics” – shorthand for the supposed liberties extended to minorities, particularly Muslims, at the expense of Hindus – had somehow led to the Kochi blast. 

Blaming Muslims for the Kochi bombing, regardless of the facts, is in keeping with the disinformation techniques frequently used by Hindu nationalists. Hindu nationalist trolls have been prolific and persistent spreaders of false anti-Palestinian information about the war in Gaza. It advances their narrative that Islam and terror are synonymous and that India, with its large Muslim minority, is in the same boat as Israel. 

This is a new, specifically Hindu nationalist position, and it has never been the official Indian position. In fact, India, with its long standing desire to be a leading voice of the decolonized Global South, has always supported the Palestinian people’s right to self-determination. India  was first among non-Arab countries to forge diplomatic relationships with Yasser Arafat’s Palestine Liberation Organization (as far back as 1975) and promptly recognized Palestinian statehood in 1988, after Arafat’s declaration of independence. 

It wasn’t until 1992 that India formally established diplomatic relations with Israel. In 2017, Modi became the first Indian prime minister to visit Israel, signaling his desire to forge a deep friendship between countries that he said had much in common. Modi’s warmth towards Israel reflected both India’s relatively recent reliance on Israeli defense and cybersecurity products — spyware among them — as well as the admiration that Hindu nationalists have for what they see as a muscular state unafraid of militarily asserting its interests. Israel, Hindu nationalists say, is a model for their own dream of establishing India as a Hindu nation.

It’s an ideological position that helps explain why on October 27, India chose to abstain rather than vote, like most other countries, to pass a non-binding resolution to seek a “humanitarian truce” in Gaza. Sharad Pawar, a veteran politician, criticized India’s abstention as “the result of total confusion in the Indian government’s policy.” 

The Modi government’s official line is that it has suffered intensely from terrorism and now takes a “zero-tolerance approach to terrorism.” But Islamophobia is at the heart of Hindu nationalist support for Israel’s war in Gaza. And India’s Hindu nationalist trolls appear to be willing to tell whatever lie is necessary to advance their single-point agenda. “What Israel is facing today,” posted the official BJP account on X on October 7, “India suffered between 2004-2014. Never forgive, never forget.” 

This is politicized misinformation by the governing party of India. The years referred to span the two terms of Modi’s predecessor Manmohan Singh, the message being that without the BJP India is vulnerable to Islamic terror. Not surprisingly, a BJP member later argued that “Hindu nationalists see Israel’s war on Gaza as their own.” 

Past Indian governments have labeled insurgents of all religions (and none) as terrorists at one time or another, and terrorist activity in India far predates 2004. But it suits the BJP to act as if it alone can protect Indians from terror. By claiming that Indian Hindus are in the same existential struggle as Israeli Jews — both facing down Islamic terrorism — Hindu nationalists, including those in government, are advancing their narrative that India must abandon its constitution and become a Hindu nation. War in Gaza gives them the opportunity to use misinformation tactics that have been perfected in domestic politics on the global stage.

The BJP’s chokehold on information

Last month, the X account belonging to the Indian American Muslim Council was censored in India after a request from the Indian government. This effectively means that users in India will be barred from seeing any IAMC tweets, as well as those of the IAMC’s ally, the Washington, D.C.-based advocacy group Hindus for Human Rights. Both organizations have been critical of Indian government policies and drawn attention to minority rights and caste issues that Modi sweeps under the carpet on his visits to Western capitals. “We were not expecting it,” IAMC’s Executive Director Rasheed Ahmed told my colleague Avi Ackermann about being booted off X in India. “But we were not surprised.” By “complying with these censorship requests,” Ahmed wrote in an email, “X and Elon Musk have effectively abetted the Indian Government’s effort to expand its authoritarian censorship campaign overseas.” 

The Indian government is trigger happy when it comes to depriving people of access to information, shutting down the internet a world-leading 84 times in 2022. It has blocked the social media accounts of credible if critical sources, including journalists, on the grounds of national security. At the same time, the government ignores trolling and the spreading of disinformation by its Hindu nationalist supporters. And — in the words of Apar Gupta, founder of the Delhi-based Internet Freedom Foundation — has framed digital data laws to “enable unchecked state surveillance.” The Modi government is a disinformation triple threat. 

WHAT WE’RE READING:

• This piece by Nilesh Christopher in Rest of World is simultaneously funny and scary, though by the end more scary than funny. In India, Instagram reels are being made with voice cloning tools powered by artificial intelligence that show Modi singing hit songs in numerous Indian languages from Punjabi to Tamil. As Christopher points out, “the videos, though lighthearted, serve a larger political purpose.” By cloning his voice, Modi can be made accessible to parts of the country where most people don’t speak Hindi, the language in which Modi gives most of his speeches. With elections coming up next year, this could be a boon for him in south India, where Modi has little support.   

• “Taking a side in a war does not require taking positions on a work of fiction,” wrote Pamela Paul in The New York Times about the decision to not publicly honorthe Palestinian author Adania Shibli at the Frankfurt Book Fair for having won a German literary prize. In a different life, I edited a couple of short stories by Shibli for a little magazine. When I reached out to her, Shibli was gracious enough to thank me (twice!) for my concern. As for the cancellation of the ceremony — we truly live in morally vacuous times.

The post Why India is awash with anti-Palestine disinformation appeared first on Coda Story.

As revealed by The New York Times, the Louisiana sheriff’s office that had ordered Reid’s arrest had a contract with Clearview AI, the New York-based facial recognition software company that allows clients to match images from surveillance video with the names and faces of people they wish to identify, drawing on a database containing billions of photos scraped from the internet. Reid spent six days in jail before authorities acknowledged their mistake.

Reid is just one among a growing list of people in the U.S. who have been through similar ordeals after police misidentified them using artificial intelligence. In nearly all reported cases, the people who were targeted are Black, and research has shown over and over again that these kinds of software tend to be less accurate when they try to identify the faces of people with darker skin tones. Yet police in the U.S. and around the world keep using these systems — because they can.

But there’s a glimmer of hope that the use of technology by law enforcement in the U.S. could start to be made more accountable. On Monday, the White House dropped an executive order on “safe, secure and trustworthy” AI, marking the first formal effort to regulate the technology at the federal level in the U.S.

Among many other things, the order requires tech companies to put their products through specific safety and security tests and share the results with the government before releasing their products into the wild. The testing process here, known as “red teaming,” is one where experts stress test a technology and see if it can be abused or misused in ways that could harm people. In theory at least, this kind of regime could put a stop to the deployment of tools like Clearview AI’s software, which misidentified Randal Reid.

If done well, this could be a game changer. But in what seems like typical U.S. fashion, the order feels more like a roadmap for tech companies than a regulatory regime with hard restrictions. I exchanged emails about it with Albert Fox Cahn, who runs the Surveillance Tech Oversight Project. From his standpoint, red teaming is no way to strike at the roots of the problems that AI can pose for the public interest. “There is a growing cadre of companies that are selling auditing services to the highest bidder, rubber stamping nearly whatever the client puts forward,” he wrote. “All too often this turns into regulatory theater, creating the impression of AI safeguards while leaving abusive practices in place.” Fox Cahn identified Clearview AI as a textbook example of the kinds of practices he’s concerned about.

Why not ban some kinds of AI altogether? This is what the forthcoming Artificial Intelligence Act will do in the European Union, and it could be a really good model to copy. I also chatted about it with Sarah Myers West, managing director of the AI Now Institute. She brought up the example of biometric surveillance in public spaces, which soon will be flat-out illegal in the EU. “We should just be able to say, ‘We don’t want that kind of AI to be used, period, it’s too harmful for the public,’” said West. But for now, it seems like this is just too much for the U.S. to say.

GLOBAL NEWS

The internet went dark in Gaza this past weekend, as Israeli forces began their ground invasion. More than 9,000 people have already been killed in nearly a month of aerial bombardment. With the power out and infrastructure reduced to rubble, the internet in Gaza has been faltering for weeks. But a full-on internet shutdown meant that emergency response crews, for instance, were literally just racing towards explosions wherever they could see and hear them, assuming that people would soon be in need of help. U.S. senior officials speaking anonymously to The New York Times and The Washington Post said they had urged Israeli authorities to turn the networks back on. By Sunday, networks were online once again.

Elon Musk briefly jumped into the fray, offering an internet hookup to humanitarian organizations in Gaza through his Starlink satellite service. But as veteran network analyst Doug Madory pointed out, even doing this would require Israel’s permission. I don’t think Musk is the best solution to this kind of problem — or any problem — but satellite networks could prove critical in situations like these where communication lines are cut off and people can’t get help that they desperately need. Madory had a suggestion on that too. Ideally, he posted on X, international rules could mandate that “if a country cuts internet service, they lose their right to block new entrants to the market.” Good idea.

Opposition politicians and a handful of journalists in India have become prime surveillance targets, says Apple. Nearly 20 people were notified by the company earlier this week that their iPhones were targeted in attacks that looked like they came from state-sponsored actors. Was Prime Minister Narendra Modi’s Bharatiya Janata Party behind it? It’s too soon to say, but there’s evidence that the ruling government has all the tools it needs to do exactly that. In 2021, the numbers of more than 300 Indian journalists, politicians, activists and researchers turned up on a leaked list of phones targeted with Pegasus, the notoriously invasive military-grade spyware made by NSO Group. At Coda, we reported on the fallout from the extensive surveillance for one group of activists on our podcast with Audible.

WHAT WE’RE READING

• My friend Ethan Zuckerman wrote for Prospect magazine this week about the spike in disinformation, new measures that block researchers from accessing social media data, and lawsuits targeting this type of research. These factors, he says, are taking us to a place where what happens online is, in a word, “unknowable.”

• Peter Guest’s excellent piece for Wired about the U.K.’s AI summit drolly described it as “set to be simultaneously doom-laden and underwhelming.” It’s a fun read and extra fun for me, since Pete will be joining our editorial team in a few weeks. Keep your eyes peeled for his stuff, soon to be coming from Coda.

The post Will a new regulation on AI help tame the machine? appeared first on Coda Story.

It’s been on my mind lately because of the proposed new online safety law in the U.K. that will set strict age requirements for young people online and require websites to scan and somehow remove all content that could be harmful to kids before it appears online. In a recent blogpost for the Wikimedia Foundation — the non-profit that supports Wikipedia — Vice President for Global Advocacy Rebecca MacKinnon wrote that by requiring sites to scan literally everything before it gets posted, the bill could upend the virtual encyclopedia’s bottom-up approach to content creation. As she put it, the law could destroy Wikipedia’s system “for maintaining encyclopedic integrity.”

You may be wondering precisely what “encyclopedic integrity” means at Wikipedia, where the article on the Marvel Comics character Spider-Man cites almost twice as many sources as the article for the Republic of Chad, a country of an estimated 18.5 million people. I get it. Wikipedia, by its own admission, has had problems with an overrepresentation of the interests of nerdy white male American 20-somethings who have too much time on their hands. But these people also really care about what they post online, and they have created an effective cooperative system for collecting, verifying and building knowledge. The system is totally dependent on the good will of thousands of contributors, and it is wholly decentralized — there are Wikipedia communities across the globe who share some basic principles, but decide together how they’ll handle contributions that could violate the law, offend readers or anything in between. In sharp contrast to corporate social media spaces, where attention is the driver of all things, this is a totally different way to “scale up” — more like scaling out — and it has led to a dramatically different kind of information resource.

I recently spoke with two Wikipedia volunteers in Wales, who are seriously worried about the effects that the U.K. bill might have on Wikipedia’s Welsh-language site, which is the only Wikipedia community that exists almost entirely within the jurisdiction of the U.K. Robin Owain and Jason Evans explained to me just how essential Wikipedia has become for Welsh speakers — with 90 million views in the last 12 months, Welsh Wikipedia is the largest and most popular Welsh-language website on the internet. Young people are a big part of this, and the secondary school system in Wales works actively with the community to engage high school students in building up material on the site. 

For Owain and Evans, this is fundamental to their purpose. “We want young people to feel as though the internet’s something that you can interact with,” Evans said. But the U.K.’s new online safety law could take that away. The two surmise that once the bill is enacted, it will be nearly impossible to allow people under 18 to contribute to the site. It could, as Evans put it, “really reinforce the idea that the internet is just a place to get information, that it’s not something you can be a part of.” 

They also worry that the bill’s requirements regarding content could leave contributors fearful of violating the law. “If there’s anything contentious, anything that has adult themes or strong language, no matter how true something might be, or how factual, there will be a concern that if it’s left on Wiki, there’s a risk that young people will see it and we’ll fall foul of the bill,” said Evans. “That in itself does create an atmosphere where you are essentially censoring Wikipedia, and that goes against everything Wikipedia is about.”

It also stings, the two noted, since the U.K. bill was written with the biggest of Big Tech companies in mind. For some reason, its authors couldn’t be persuaded to make a carve-out for projects like Wikipedia. But Owain has some hope that Welsh people and the Welsh government — a Labour party-dominated legislature that does ultimately answer to the British parliament — just might have something to say about it. 

“I should think the whole of Wales would stand up as one and say, ‘Oh! We will access Wikipedia!’ and the Welsh government will support it,” Owain said, raising a fist in the air. I hope he’s right.

Pro-Palestinian messages are getting shadowbanned and horribly mistranslated on social media. Over the past two weeks, multiple journalists, artists, Instagram influencers and even New York Times reporter Azmat Khan reported that their posts containing words like “Palestine” and “Gaza” simply weren’t reaching followers. To make matters worse, a handful of Instagram users found that the platform was spontaneously inserting the word “terrorist” into its machine-translations of the word “Palestinian” from Arabic to English. This reminds me of 2021, when the Al-Aqsa Mosque in Jerusalem was mistakenly labeled as a “dangerous organization” by the same platform. The takeaway here is that Meta, Facebook and Instagram’s parent company, has told its computers to use things like the U.S. government’s list of designated terror groups in order to identify content that could spark violence. This might sound reasonable on the surface, but when you throw in a little artificial intelligence and some plain old human bias, it can get ugly.

Meta has a long history of mistreating speech about Palestine, and while the company is always quick to blame the tech (it’s a “glitch,” the execs say), the evidence suggests that it is not that simple. Between the U.S. government’s list of designated terror groups, Meta’s own list of “dangerous individuals and organizations,” the EU’s Digital Services Act, soft pressure from the U.S. and Israel alike, and a set of community standards that seems to get more complicated by the day, it seems like the decks are stacked against Palestinians who are just trying to say what they feel right now. I will keep my eyes peeled for further “glitches” in the weeks ahead.

Venezuela saw a smattering of web outages over the weekend, during  the political opposition’s presidential primary election, the first to be held since 2012. This was no ordinary vote — public trust in the country’s electoral system is extraordinarily low, due to a history of election fraud allegations and the ruling United Socialist Party’s routine efforts to block bids by its opponents. Opposition organizers created an independent entity, the National Primary Commission, to oversee the election and set up polling places in churches and at people’s homes, rather than using publicly managed buildings like schools and community centers. Over the weekend, the network monitoring group NetBlocks documented huge drops in connectivity in Caracas, and Venezuela Sin Filtro, a censorship monitoring group, reported that websites which listed polling places were inaccessible on most telecom networks. The group also presented evidence that the systems used to count the votes — an estimated 1.5 million people cast their ballots, both inside and outside the country — were hit with cyberattacks. Out of a crowded field, María Corina Machado, a conservative former lawmaker, had won more than 90% of the votes counted by mid-week.

Apple has a problem with Jon Stewart. Last week, the cherished TV comic abruptly canceled the third season of “The Problem with Jon Stewart,” his show on streaming service Apple TV, after the company reportedly pushed back on the script for an episode in which he planned to discuss AI and China. We don’t hear much about Apple in stories about content control and Big Tech, but between the App Store, Apple TV and Apple Podcasts, the company has a huge amount of discretion over what kinds of media and apps its users can most easily access. And when it comes to China — home to the Foxconn factory where half of the world’s iPhones are manufactured — the company has often been quick to bow to censorship demands. There’s been no further information about what exactly Stewart had planned to talk about, but it’s easy to imagine that it might have had Apple’s overlords worried about offending their Chinese business partners.

WHAT WE’RE READING

• My friend Oiwan Lam, an intrepid Hong Konger who has kept her ear to the ground and her finger on the pulse of the Chinese internet through all the political ups and downs of the past decade, translated a fascinating exclusive interview by a YouTuber known as Teacher Li with a censorship worker from mainland China. Give it a read.

• In a new essay for Time magazine, Heidy Khlaaf, who specializes in AI safety in high-stakes situations, says we should regulate AI in the same way we do nuclear weapons.

• The fraud trial of Sam Bankman-Fried, founder of the cryptocurrency exchange FTX, is now well underway in New York. This piece in The Ringer puts you right in the courtroom.

The post How the new UK tech law hurts Wikipedia appeared first on Coda Story.

It has been more than a week since Israel cut off electricity, water, fuel and food shipments for 2.3 million people in Gaza, as part of its response to the unprecedented attacks launched by Hamas on October 7. Internet shutdowns have become an all-too-common tool of control in conflict situations around the world. But an enforced power cut takes it to another level entirely. It makes network shutdowns look like child’s play.

UN human rights chief Volker Turk, Human Rights Watch and the International Committee of the Red Cross have all said these cuts amount to a violation of international humanitarian law — in other words, a war crime.

Yet the power is still out. The blackout has caused a cascade of problems for all kinds of systems, from water pumps and sanitation to telecommunications networks, in an already catastrophic situation. Under bombardment by Israel, more than 3,000 Gazans have been killed, thousands have been injured and, according to the United Nations, about a million people displaced. 

It is getting more and more difficult for people in Gaza to stay in contact with each other, and with people outside the territory. I spoke with Asmaa Alkaisi, a recent graduate of the University of Washington’s international studies school, who came to the U.S. from Gaza, where she has lived most of her life. 

As recently as two weeks ago, Alkaisi had a daily habit of checking in with her family, most importantly her mother, on video calls. But over the past 10 days, she has been unable to reach them. She has resorted to checking lists of the dead and missing, to see if their names appear.

“If you don’t see their names in the lists of missing or killed ones, then you know that they’re OK,” she said. It has become almost impossible to reach people locally. “I have lost contact with my best friend for 11 days now,” she said. “I honestly don’t know if she’s still alive.”

She explained that reports on television have new importance. “I found out from the news and the videos that my house was completely destroyed and leveled to the ground,” she told me. “I didn’t know that from my family, I found out from the news.”

At 39 years old, Alkaisi has lived through many periods of intense conflict in Gaza, but this “tops everything we have ever been through,” she said. She told me about a classmate of hers in the U.S. who once asked if Gazans “get used to” living with the looming threat of military aggression from Israel. The question shocked her.

“Every time this happens, it brings back all the trauma, it is as if it’s the first time it is happening,” she said. “We’re all shocked, we’re all in fear, we’re all petrified of the situation. You could be the next target. That’s more scary than anything in the world.”

And just like everyone else in the territory, journalists are facing terrifying, life-threatening circumstances. The BBC’s Rushdi Abu Alouf wrote on Tuesday about his own struggle to report on the devastation while trying to keep his family safe. With so much of what is happening on the ground being called into question by actors on all sides, these accounts really matter, and they will be harder and harder to capture and preserve as the situation worsens. 

I looked at a different part of this issue last week, focusing on the wreckless spread of disinformation by people who are not on the ground. But I shied away from the most consequential reports, like the gut-wrenching — but unsupported — allegation that babies in Israel were decapitated by Hamas, thinking it would be better not to repeat this bloody narrative, lest it be perpetuated.

My former colleague Reem Al-Masri, a media policy and disinformation researcher from Jordan, called me out on this. “Yes, social media is fertile ground for disinformation, but inaccurate information is only as harmful as its reach,” she wrote in an email. “We cannot treat misinformation that stays within the galaxy of social media the same way once it has made its way to officials,” she wrote, referring to U.S. President Joe Biden. Both Israeli and U.S. officials repeated this story, only to acknowledge later that they had no evidence to support it. This kind of disinformation is uniquely dangerous, Reem cautioned, because it affects how states and other actors make wartime decisions. She’s right. Thank you, Reem.

Hamas is abusing Facebook’s livestream feature. The families of several of the nearly 200 Israelis being held hostage by Hamas have reported that their captors are breaking into their loved ones’ Facebook accounts and in some cases livestreaming attacks or messages from wherever victims are being held. The account breach at the root of this is one thing, which unfortunately isn’t a new tactic — I’ve seen police do this in situations where colleagues have been arrested or detained. And this particular use of livestream calls to mind mass shootings that have been broadcast in the same way, most famously the massacre of 51 people at two mosques in Christchurch, New Zealand, in 2017. Facebook’s parent company Meta says it’s got a war room of people fluent in Arabic and Hebrew who are reviewing posts and trying to make game-time decisions on what should stay up and what should come down — this is good, though these efforts have pitfalls of their own, as Meta’s auditors noted a few years back. But there’s no way to “review” a livestream. At this point, if I could make them get rid of the feature, I would.

Is Sudan’s Omar al-Bashir back in action? Or is it just the AI talking? While everyone in the West seems to be watching Israel and Palestine, the conflict in Sudan continues without relent. Last week, the BBC dug into The Voice of Sudan, a viral TikTok account that since August has been posting audio missives that it claims are leaked recordings from former President Omar al-Bashir, who was ousted following mass protests in 2019. This is a real eyebrow-raiser, since al-Bashir hasn’t been seen in public for more than a year. But through The Voice of Sudan account, he is apparently speaking again, sounding in good health and criticizing the Sudanese army.

Forensics experts who’ve studied the recordings say that they display hallmarks of deep fakes and that they probably were made using an off-the-shelf artificial intelligence “voice cloning” tool that could capture audio from the former president’s actual speeches and then use that material to generate convincing imitations of him. The reporters talked with Mohamed Suliman, a Sudanese AI researcher at Northeastern University whose work I’ve highlighted in the past. “What’s alarming is that these recordings could also create an environment where many disbelieve even real recordings,” he told them. This is a really good point, and it’s instructive for this moment, far beyond Sudan. With so many convincing fakes making the rounds, it seems easier every day to question what’s real.

Dating apps are becoming dangerous in Uganda. The country’s updated law that criminalizes homosexuality has been on the books for a few months now, and public data shows that 17 people were arrested under the law in June and July. Two of them were “caught” expressing an LGBTQ identity — which is now literally a crime in Uganda — on dating apps. The Kampala-based Human Rights Awareness and Promotion Forum found that in both instances, the gay men using dating apps were effectively entrapped by another user who then reported them to police.

WHAT WE’RE READING

• The Guardian published an explosive investigation of Amazon’s warehouses in Saudi Arabia, where dozens of Nepali workers told reporters they were tricked by recruiters, forced to work under harsh conditions, laid off and then made to pay sky-high fees in order to return home.
• Rest of World talked with Meredith Whittaker, president of Signal, about how governments from Brazil to India and now the U.K. have put the future of the privacy-first messaging app on the line.
• Writing for The Atlantic, acclaimed AI reporter Karen Hao dug deep into the critical battle playing out between the U.S. and China over tech export controls and who owns the future of AI. Don’t miss this one.

The post Losing lifelines in Gaza appeared first on Coda Story.

I have few words for the atrocities carried out by Hamas in Israel since October 7, and the horrors that are now unfolding in Gaza.

I have a few more for a certain class of social media users at this moment. The violence in Israel and Palestine has triggered what feels like a never-ending stream of pseudo-reporting on the conflict: allegations, rumors and straight up falsehoods about what is happening are emerging at breakneck speed. I’m not talking about posts from people who are actually on the ground and may be saying or reporting things that are not verified. That’s the real fog of war. Instead, I’m talking about posts from people who jump into the fray not because they have something urgent to report or say, but just because they can.

Social media has given many of us the illusion of total access to a conflict situation, a play-by-play in real time. In the past, this was enlightening — or at least it felt that way. During the Gaza War in 2014, firsthand civilian accounts were something you could readily find on what was then called Twitter, if you knew where to look. I remember reading one journalist’s tweets about her desperate attempt to flee Gaza at the Rafah border crossing, amid heavy shelling by Israeli forces — her story stuck with me for years, returning to my mind whenever Gaza came up. These kinds of narratives may still be out there, but they are almost impossible to find amidst the clutter. And this time around, those stories from Gaza could disappear from the web altogether, now that Israel has cut off electricity in the territory, and internet access there is in free fall.

This illusion of being close to a conflict, of being able to understand its contours from far away is no longer a product of carefully reported news and firsthand accounts on social media. Sure, there was garbage out there in 2014, but nearly a decade on, it feels as if there are just as many posts about war crimes that never happened as there are about actual atrocities that did. Our current internet, not to mention the state of artificial intelligence, makes it too easy to spread misinformation and lies. 

On October 9, tens of thousands of people shared reports that Israeli warplanes had bombed a historic church in Gaza, complete with photos that could convince anyone who hasn’t actually been to that site. The church itself posted on Facebook to discredit the reports and assure people that it remains untouched. Conflict footage from Syria, Afghanistan, and as far away as Guatemala has been “recycled” and presented as contemporary proof of brutalities committed by one side or the other. And of course there are the “videos” of airstrikes that turned out to be screengrabs from the video game “Arma 3.” Earnest fact-checking outfits and individual debunkers have rushed in to correct and inform, but it’s not clear how much difference this makes. People look to have their biases confirmed, and then scurry on through the digital chaos.

Some are even posting about the war for money. Speaking with Brooke Gladstone of “On The Media” on October 12, tech journalist Avi Asher-Shapiro pointed out that at the same time that X has dismissed most of its staff who handled violent and false content on the platform, it has created new incentives for this kind of behavior by enabling “creators” to profit from the material they post. So regardless if a post is true or not, the more likes, clicks and shares it gets, the more money its creator rakes in. TikTok offers incentives like this too.

While X appears to be the unofficial epicenter of this maelstrom, the disinformation deluge is happening on Meta’s platforms and TikTok too. All three companies are now on the hook for it in the European Union. EU Commissioner Thierry Breton issued a series of public letters to their CEOs, pointing out that under the bloc’s  Digital Services Act, they have to answer to regulatory authorities when they fail to stop the spread of content that could lead to actual harm.

The sheer volume of disinformation is hard to ignore. And it is an unconscionable distraction from the grave realities and horror of the war in Gaza.

In pursuit of mass scale, the world’s biggest social media companies designed their platforms to host limitless amounts of content. This is nearly impossible for them to oversee or manage, as the events in Israel and Palestine demonstrate. Yet from Myanmar and Sudan to Ukraine and the U.S., it has been proven again and again that violent material on social media can trigger acts of violence in real life, and that people are worse off when the algorithms get the run of the place. The companies have never fully gotten ahead of this issue. Instead, they have cobbled together a combination of technology and people to do the work of identifying the worst posts and scrubbing them from the web. 

The people — content moderators — typically review hundreds of posts each day, from videos of racist diatribes to beheadings and sexual abuse. They see the worst of the worst. If they didn’t, the platforms would be replete with this kind of material, and no one would want to use them. That is not a viable business model.

Despite the core need for robust content moderation, the Big Techs outsource most of it to third-party companies operating in countries where labor is cheap, like India or the Philippines. Or Kenya, where workers report being paid between $1 and $4 per hour and having limited access to counseling — a serious problem in a job like this.

This week, Coda Story reporter Erica Hellerstein brought us a deep dive on the lives of content moderation workers in Nairobi who over the past several months have come together to push back on what they say are exploitative labor practices. More than 180 content moderators are suing Meta for $1.6 billion over poor working conditions, low pay and what they allege was unfair dismissal after Meta switched contracting companies. Workers have also voted to form a new trade union that they hope will force big companies like Meta, and outsourcing firms like Sama, to change their ways. Erica writes:

“While it happens at a desk, mostly on a screen, the demands and conditions of this work are brutal. Current and former moderators I met in Nairobi in July told me this work has left them with post-traumatic stress disorder, depression, insomnia and thoughts of suicide.

These workers are reaching a breaking point. And now, Kenya has become ground zero in a battle over the future of content moderation in Africa and beyond. On one side are some of the most powerful and profitable tech companies on earth. On the other are young African content moderators who are stepping out from behind their screens and demanding that Big Tech companies reckon with the human toll of their enterprise.”

Odanga Madung, a Kenya-based journalist and a fellow at the Mozilla Foundation, believes the flurry of litigation and organizing represents a turning point in the country’s tech labor trajectory. In his words: “This is the tech industry’s sweatshop moment.” Don’t miss this terrific, if sobering read.

Images of violence are also at issue in Manipur, India, where a new government order has effectively banned people from posting videos and photos depicting acts of violence. This is serious because Manipur has been immersed in waves of public unrest and outbursts of ethnic violence since May. After photos of the slain bodies of two students who had gone missing in July surfaced and went viral on social media last month, authorities shut down the internet in an effort to stem unrest. In the words of the state government, the new order is intended as a “positive step towards bringing normalcy in the State.” But not everyone is buying this. On X yesterday, legal scholar Apar Gupta called the order an attempt to “contour” media narratives that would also “silence the voices of the residents of the state even beyond the internet shutdown.”

The U.N. is helping Saudi Arabia to “tech-wash” itself. This week, officials announced that the kingdom will host the world’s biggest global internet policy conference, the Internet Governance Forum (IGF), in 2024. This U.N.-sponsored gathering of governments, corporations and tech-focused NGOs might sound dull — I’ve been to a handful of them and can confirm that some of it is indeed a yawn. But some of it really matters. The IGF is a place where influential policymakers hash out ideas for how the global internet ought to work and how it can be a positive force in an open society — or how it can do the opposite. After China and Iran, I can think of few places that would be worse to do this than Saudi Arabia, a country that uses technology to exercise authoritarianism in more ways than we probably know.

The post How Big Tech is fueling — and monetizing — false narratives about Israel and Palestine appeared first on Coda Story.

Simecka and the journalist who featured in the audio clip both quickly called it a fake, and fact-checking groups backed up their claims, noting that the digital file showed signs of having been manipulated using AI. But they were in a tough spot — the recording emerged during the 48-hour pre-polling period in which the media and politicians are restricted by law from speaking about elections at all. In the end, Progressive Slovakia lost to Fico’s Smer-SD party, and the political winds have quickly shifted. Fico ran on a populist platform, pledging that his government would “not give a single bullet” to Ukraine. Already heeding Fico’s word, the sitting president opposed a new military aid package for Ukraine just yesterday. And now Fico is expected to forge an alliance with Hungary’s Viktor Orban, the only EU head of state who has sided with Russia since the war began.

The possibility that a piece of evidence was fabricated using AI throws a new digital wrench into the already chaotic and oversaturated media landscape that all voters face in any election cycle. Slovakia isn’t the first country to run into this problem, and it definitely won’t be the last. Similar circumstances are expected in the run-up to Poland’s parliamentary elections later this month, where the war in Ukraine will very much be on the ballot, and where a victory for the right-wing Law and Justice party could add to Orban’s growing camp.

While the debunked audio clip in Slovakia was dutifully garnished with a fact-check label indicating that it may have been fabricated, it’s still making the rounds on Facebook. 

In fact, Meta (owner of Facebook, Instagram and Threads) and Google (owner of YouTube) have both indicated in recent months their plans to roll back some of the disinformation-busting efforts that they trotted out following the 2016 election in the U.S. But it is X, formerly known as Twitter, that is leading in the race to the bottom — every week, we see more signs that it has little interest in enforcing its rules on disinformation. 

Even the EU itself has brought this up: Last week, European Commission Vice President Vera Jourova called X out on the issue. “Russian propaganda and disinformation is still very present on online platforms. This is not business as usual; the Kremlin fights with bombs in Ukraine, but with words everywhere else, including in the EU,” Jourova said.

Although I was never all that convinced by their fact-checking efforts, it doesn’t help that the tech giants seem to have thrown up their hands on the issue. It leaves me almost nostalgic for a time when all we had to deal with was straight-up false or racist messages flooding the zone. Turns out, things could and did get worse. 2024, here we come.

GLOBAL NEWS

A Russian blogger was sentenced to eight and a half years in prison after being convicted of reporting “fake” news about Russian military actions in Ukraine. This type of journalism became a crime in Russia shortly after Russian forces launched the full-scale invasion of Ukraine in February 2022. Aleksandr Nozdrinov was arrested not long after the war began, and was finally dealt a sentence this week. Nozdrinov maintained a YouTube channel where he regularly posted video evidence of police corruption and malfeasance for an audience of more than 34,000 subscribers. According to the Committee to Protect Journalists, Nozdrinov denies having posted the material cited by prosecutors. He believes that the case against him was fabricated by authorities intent on targeting him in retaliation for his anti-corruption activities on YouTube.

Monday marked the fifth anniversary of the murder of Washington Post columnist Jamal Khashoggi, a Saudi exile and frequent critic of the Saudi Arabian regime. There is little doubt that Khashoggi’s gruesome killing inside the Saudi consulate in Istanbul came at the behest of Crown Prince Mohammed bin Salman. It came out later on that Khashoggi and some of his closest family members and colleagues were targeted with Pegasus, the notoriously invasive mobile phone spyware built by the Israeli firm NSO Group and used to spy on journalists in more than 50 countries, from Mexico to Morocco to India. The digital dimensions of Saudi Arabia’s tactics of repression don’t stop here, and they certainly are not news. But they do bear repeating.

Researchers in Australia think anti-Indigenous narratives on social media could swing an upcoming referendum. Tomorrow, Australians will vote on whether or not the country should establish a body that would advise the government on policy decisions affecting Aboriginal and Torres Strait Islander communities. A year ago, public opinion polls indicated that most Aussies — including Prime Minister Anthony Albanese — were in favor of the measure. But that has changed in recent months, and social science researchers say viral, racialized anti-Indigenous messaging campaigns on X and TikTok might have something to do with it. The Conversation is running a series on the issue — they’re worth a read.

WHAT I’M NOT READING: THE NEW MUSK BIOGRAPHY

Instead of reading Walter Isaacson’s new biography of Elon Musk, I have been lapping up the reviews and emoji-hearting other people’s dedication to pointing out everything that somehow failed to make the cut in this 670-page “insight-free doorstop of a book” (Gary Shteyngart’s words, not mine).

In the tome’s final pages, Isaacson writes: “Sometimes great innovators are risk-seeking man-children who resist potty training.” Um, what? As Jill Lepore wrote in The New Yorker: “This is a disconcerting thing to read on page 615 of a biography of a fifty-two-year-old man about whom a case could be made that he wields more power than any other person on the planet who isn’t in charge of a nuclear arsenal.” Since Isaacson didn’t, Lepore took it upon herself to school readers on some of the harsh political realities of apartheid-era South Africa where Musk grew up, noting that his maternal grandfather apparently moved the family from Canada to South Africa because of apartheid. She touches on grandpa’s openly antisemitic views, which Isaacson somehow writes off as “quirky.”

The book also has some pretty serious whoopsies when it comes to details about Musk’s financial moves. In Financial Times columnist Bryce Elder’s acid assessment: “When it comes to money, Isaacson is more a transcriber than a biographer.” Eesh.

Writing for The Atlantic, Sarah Frier had what feels to me like the truest line: “We don’t need to understand how he thinks and feels as much as we need to understand how he managed to amass so much power, and the broad societal impact of his choices — in short, how thoroughly this mercurial leader of six companies has become an architect of our future.” 

The post How AI is supercharging political disinformation ops appeared first on Coda Story.

This is going to be my last newsletter for a while because I need to focus on writing my next book (about the fight against money laundering), so I’d like to start by thanking you for reading my weary and cynical thoughts every week, and to apologize for the fact I’m not going to keep sending them out.

Looking back at the last couple of years, I see that one of the key themes that I’ve been banging on about is the question of why Western governments fail to do anything (much) about corruption, despite the clear and obvious evidence that it makes all bad things worse. Is it incompetence — or corruption? Is the problem just too hard for honest people to solve? Are politicians themselves on the take, and thus personally invested in perpetuating the situation?

Or is it both of the above, plus something else entirely? 

I had a meeting recently with a think tank employee who was tasked with coming up with some policy ideas for a senior British politician to announce at a party conference. As you are no doubt aware, Britain has a bit of a dirty money problem, so I was delighted to sit down with them. For anyone who’s read this newsletter before, you’ll have noticed that I regularly talk about the need to adequately resource law enforcement, so that’s what I led with. I described how ordinary police forces can’t investigate fraud because they lack trained officers, and how the national-level agencies fail to prosecute kleptocracy for the same reasons. If the politician wanted Britain to stop being “butler to the world,” what they really needed to do was announce a vast increase in funding and pledge to maintain funding levels for the foreseeable future.

“That’s not going to get them any headlines though, is it?” the think tanker replied. “We need something new.”

I did try to suggest some legal changes, but my heart wasn’t really in it because I’d suddenly spotted what the problem was, and it seemed to have resonance far beyond the U.K.

Our governments are like couch potatoes who are determined to get fit. They are unhealthy, they know it, and they know what the solution is: exercise. In furtherance of that strategy, they buy a treadmill. This gets them a good headline, and they like it. So they buy more fitness equipment: a stationary bicycle, a StairMaster, a rowing machine, a pair of running shoes that will improve performance, athleisure wear that wicks away sweat, some of those leg warmers that Jane Fonda wore in her workout videos, and so on. Every time they buy something, they say that it’s proof of their commitment to get fit, and headline writers praise them for it.

But at some point, they’ve got enough fitness equipment. That’s when they need to start exercising, but that’s also when the whole calculation changes. Because exercise is difficult and it’s not going to win any positive coverage. In fact, it could well do the opposite: If enforcement agencies bring the kind of long and complex prosecutions required to combat financial crime, they’re likely to make mistakes, and then the politicians will get criticized, and that’s no fun at all. It’s far safer to announce a new legislative initiative, and leave the sweating to someone else at some point in the ever-receding future.

Is there a word for this? Short-termism isn’t right, but I can’t think of another term for a feedback loop that actively militates against long-term action being taken. I am, however, an optimist (even when pessimists win, they lose, as someone probably once said) and intend to remain one. Financial crime is a tax on our societies, enriching criminals and immiserating everyone else. Corruption is a force multiplier for kleptocrats. Tax evasion is weakening our public services. It is so obvious that tackling these linked curses should be a priority that, at some point, even politicians will realize it.

CRYPTO

Last week, I interviewed journalist Zeke Faux about his new book, “Number Go Up,” which is a very good account of the mirror dimension that is the crypto-verse. He was every bit as amusing as his book, and I recommend it to you. One particularly entertaining point that he made was how when he first pitched the idea of the book to publishers, cryptocurrencies had not yet suffered the so-called crypto winter. As a result, he was relying on the collapse happening while he researched the book. Spoiler: It did.

• “Faux demonstrates his incisive grasp of the story with the very first words of his prologue: ‘“I’m not going to lie,” Sam Bankman-Fried told me,’ he writes. ‘That was a lie,’” as this entertaining Los Angeles Times review puts it.

It’s always nerve-wracking researching a book about current affairs because of the concern that whatever phenomenon you’re describing will be solved by the time you’ve finished writing it. When I was researching “Moneyland,” I was convinced the problems I’d identified were so pressing that politicians would resolve them long before I made it to print. Funnily enough, Nick Shaxson has told me that he felt the same thing when he wrote his own book about offshore finance — “Treasure Islands” — which was published seven years earlier.

So when I say I’m an optimist, do I mean that I think money laundering will be solved by the time my book is finished and the world will be better? Or do I mean that it won’t and people will therefore want to read my book? Good question. Thanks.

RISKS

What might get in the way of the problem of money laundering being solved? A long answer to that question would take up an entire book (perhaps I should write it), but the short answer is just two words: Donald Trump. That’s not to say progress in tackling the mechanisms of corruption is impossible if Trump is reelected. After all, the Corporate Transparency Act was passed by Congress in January 2021 — although, admittedly, with a veto-proof majority — when he was still president, opening the way for U.S. shell companies to become less opaque.

The significance of his reelection for the global fight against kleptocracy is different: Tackling financial crime will be a complex, laborious, lengthy effort, with multiple countries having to be charmed, cajoled and bullied into taking part. The only country capable of leading that effort is the U.S., and Trump is utterly incapable as both a politician and a human being of making that happen.

The European Union is currently poised halfway between making corporate ownership data public or leaving it private. Any U.S. backtracking would embolden European enemies of the plan, thus fatally weakening attempts to create a global standard.

• “Thanks to the decades of secrecy that such opaque entities have provided, unscrupulous individuals from across the world were able to find safe haven in the EU – circumventing sanctions, evading accountability and committing further crimes with impunity,” said this open letter to the European Commission from earlier this year.

Fighting financial crime should not be a party-political point, in that all democratic states should be dedicated to keeping their economies and societies free of dirty money. However, there is a world of difference between Trump’s incoherent mess of an approach, and that of Joe Biden’s White House, with its careful anti-corruption strategy.

• “Corruption robs citizens of equal access to vital services, denying the right to quality healthcare, public safety, and education. It degrades the business environment, subverts economic opportunity, and exacerbates inequality,” says the foreword of the “United States Strategy on Countering Corruption.”

This thoughtful article from Charles G. Davidson and Ben Judah makes clear how corruption is also a threat to democracy, which depends not just on the system being fair, but also on everyone believing that the system is fair.

• “Financial secrecy has swollen in recent years as elites have abandoned their duty to pay their fair share. A metastasizing culture of tax avoidance by corporations and the wealthy has weakened national values, institutions, and goals across the West while fueling levels of inequality that wreck national cohesion, drive spiraling resentment, and stoke anger. This is empowering the enemies of democracy at home and abroad,” Davidson and Judah conclude.

Transparency is necessary but not sufficient, and passing laws is not enough, as is evident here in the U.K. An immediate response to the Russian assault on Kyiv last year was the passage of a law making public the owners of shell companies that hold U.K. property, with the aim of ending a loophole long enjoyed by the oligarchs that have invested in London mansions. More than half of such properties in the London borough of Kensington and Chelsea still do not reveal their owners, and there is no sign of enforcement action being taken against them.

• “There is no point building a dam halfway across a river. These gaps are threatening the efficacy of the entire Register,” said Andy Summers, associate professor at the London School of Economics Law School.

Nowhere, of course, is this of greater significance than in Ukraine, where long-term victory over Russia is a tall order in the best of circumstances. Without ending corruption, it will be all but impossible, not least because corruption allegations would make Western aid harder to justify.

REASONS TO BE OPTIMISTIC

I’ve just been in Texas for a few weeks, reading documents relating to the creation of the Bank Secrecy Act, which was passed in 1970 as the world’s first anti-money laundering legislation. At the time of its passage, Richard Nixon — hardly a paragon of cleanliness in public office — was president. After its passage, banks fought against its implementation all the way to the U.S. Supreme Court. Police agencies lacked enthusiasm for it and took years to actually get around to using it. And yet it survived and went on to become the cornerstone of federal and global attempts to clean up the financial system.

The lesson I took from my days with the boxes upon boxes of papers — among them memos between participants, scribbled notes from members of Congress, transcripts of committee hearings, letters from grateful constituents — is that careful, thorough, well-intentioned efforts change the world. They may not earn headlines like the purchase of a new piece of fitness equipment does, but all they require is for a sufficient number of people to be prepared to put the hours in, and they will come to pass.

And that reminds of what Daria Kaleniuk, the tireless Ukrainian activist, said years ago when I asked her how she kept going in her battle to end corruption despite ceaseless official obstruction (and worse). The aim isn’t to make the world perfect — just to make it better.

• “I don’t think about ending corruption completely. We are currently at 4% of where I want us to be, and my ambition is to get to 5,” Kaleniuk said.

WHAT I’VE BEEN READING

Speaking of tireless activists, I really enjoyed Naomi Klein’s “Doppelganger,” which is as passionate and thoughtful as you’d expect one of her books to be. It starts from the rather slight observation that she kept being confused with Naomi Wolf, before exploring the weird synthesis between the far right and the New Age left that has taken place since the pandemic. 

Apart from that, I was late to Lea Ypi’s “Free,” but I highly recommend it as a funny, fresh and thoughtful take on politics, growing up and Marxism.

I hope to revive this newsletter when my book is done, but until then, thanks for reading.

The post Why politicians are such couch potatoes when it comes to corruption appeared first on Coda Story.

Last week, the U.K. passed the Online Safety Bill, a law that’s meant to help snuff out child sexual exploitation and abuse on the internet. The law will require websites and services to scan and somehow remove all content that could be harmful to kids before it appears online. 

This could fundamentally change the rules of the game not only for big social media sites but also for any platform that offers messaging services. A provision within the law requires companies to develop technology that enables them to scan encrypted messages, thus effectively banning end-to-end encryption. There is powerful backing for similar laws to be passed in both the U.S. and the European Union.

Scouring the web in an effort to protect children from the worst kinds of abuse sounds like a noble endeavor. But practically speaking, this means the state would be surveilling literally everything we write or post, whether on a public forum or in a private message. If you don’t already have a snoopy government on your hands, a law like this could put you just one election away from a true mass surveillance regime of unprecedented scale. Surely, there are other ways to keep kids safe that won’t be quite so detrimental to democracy.

As a parent of two tiny children, I feel a little twinge when I criticize these kinds of laws. Maybe the internet really is rife with content that is harmful to children. Maybe we should be making these tradeoffs after all. But is kids’ safety really what’s driving the incredibly powerful lobbying groups that somehow have a seat at every table that matters on this issue, from London to D.C. to Brussels?

It is not. This week, Balkan Insight dropped a deeply reported follow-the-money investigation of the network of lobbying groups pushing for this kind of “safety” legislation in Europe that made a connection that really ought to be on everyone’s radar: The AI industry is a major lobbying force driving these laws.

The piece takes a hard look at Thorn, a U.S. organization that has been a vocal advocate for children’s online safety but that has also developed proprietary AI software that scans for child abuse images. Thorn seems to be advocating for companies to scan every drop of data that passes through their servers with one hand and then offering the perfect technical tool for said scanning with the other. It’s quite the scheme. And it seems to be working so far — the U.K. law is a done deal, and talks are moving fast in the right direction for Thorn in Europe and the U.S. Oh, and the U.S. Department of Homeland Security is already among Thorn’s current clients.

As a number of sources quoted in the Balkan Insight investigation point out, these laws might not even be the best way to tackle child exploitation online. They will require tech companies to break encryption across the internet, leaving people vulnerable to all kinds of abuse, child exploitation included. This level of surveillance will probably send the worst predators into deeper, darker corners of the web, making them even harder to track down. And trying to scan everything is often not the best way to trace the activities of criminal groups. 

I’m sure that some of the people pushing for these laws care deeply about protecting kids and believe that they are doing the best possible thing to make them safer. But plenty of them are driven by profit. That is something to worry about.

GLOBAL NEWS

The internet was barely accessible last week in the disputed territory of Nagorno-Karabakh, where Azerbaijani military troops have effectively claimed control of the predominantly ethnic Armenian region. Tens of thousands of Karabakhi Armenians are fleeing the mountainous region that abuts the Azerbaijani-Armenian border in what one European MEP described as a “continuation of the Armenian genocide.” The role of Russia in the conflict (which amid the war in Ukraine seems to have withdrawn its long-time support for the Armenian side) and the importance of Azerbaijan to Europe as a major oil producer have dominated most of the international coverage. But the situation for people in the region is dire and has largely been ignored. The lack of basic digital connectivity isn’t helping — researchers at NetBlocks showed last Thursday that Karabakh Telecom had almost no connectivity from September 19, when the full military offensive launched, until September 21, when Armenian separatist fighters surrendered. TikTok was also blocked during this period. 

Azerbaijani authorities are also taking measures to ensure that their critics keep quiet online. Several Azerbaijani activists and journalists who have posted critical messages or coverage of the war on social media have been arrested for posting “prohibited” content.

An internet blackout has also gone back into effect in Manipur, India, just days after services were restored. An internet blackout has been in effect in Manipur since the beginning of May, as nearly 200 people have died in still ongoing ethnic violence. This blackout was finally lifted last weekend. But protests in Imphal, the capital city of the northeastern state that borders Myanmar, erupted this week after photos of the slain bodies of two students who had gone missing in July surfaced and went viral on social media. Now the Manipur government, which has largely failed to contain the violence, even as its critics accuse it of fomenting clashes, has said disinformation, rumors and calls for violence are being spread online, necessitating another shutdown. An order from the state governor’s office, which has been circulating on X, says the shutdown will last for another five days. Indian authorities frequently shut down the internet in embattled states, despite the cost to the economy — an estimated $1.9 billion in the first half of this year alone — and the apparent lack of effect on public safety.

Speaking of shutdowns, there’s new hope that Amazon might have to shutter some part of its business or at least clean up its practices. This week, the U.S. Federal Trade Commission, alongside 17 state attorneys general, filed a massive lawsuit accusing the e-commerce behemoth of inflating prices, degrading product quality, and stifling innovation. These practices hurt both consumers and third-party sellers, says the FTC, who have little choice but to sell their goods on Amazon’s platform. This is a bread-and-butter anti-monopoly case — it doesn’t rely on the pioneering legal theories the FTC Chair Lina Khan is known for. In legal scholar and former White House tech advisor Tim Wu’s view, “The FTC complaint against Amazon shows how much, over the last 15 years, Silicon Valley has understood and used scale as a weapon. In other words, the new economy relied on the oldest strategy in the playbook — deny scale to opponents.” I couldn’t agree more.

The post Why are AI software makers lobbying for kids’ online safety laws? appeared first on Coda Story.

Iran has not seen uprisings of this magnitude since the Iranian Revolution of 1979: They have dwarfed the Green Movement protests of 2009, and they extend far beyond calls for an end to the mandatory hijab. Demonstrators — who range from university students to doctors to labor unions — have demanded economic reforms and the codification of women’s rights and called for “death to the dictator.” They have been met with a sharp, brutal response from Iranian authorities. Tens of thousands have been arrested and jailed, and more than 500 people have been killed in clashes with the security forces. Seven men have been executed by hanging for their involvement with the protests. And while large-scale demonstrations have mostly tapered off, acts of resistance continue.

Technology has played a role at many turns in what has happened over the past year. Social media blackouts and internet shutdowns have become a hallmark of the regime’s response to the protests: Research groups like OONI and NetBlocks have documented the blackouts, while tools like VPNs and Starlink have helped people work around them. The Google Play store, where 90% of Iranians would normally download apps, has been blocked since the protests began, to no avail.

And as with every major protest movement of the past decade, social media has been critical to the strategies of both the protesters and the regime they oppose. In Iran, where all major U.S.-based platforms are now blocked, Telegram became the go-to platform for protesters — and for the regime too. Several months ago, I spoke with Mahsa Alimardani about the power that Telegram held in this situation. Alimardani, who is a PhD candidate at the Oxford Internet Institute and a senior researcher at Article19, impressed upon me that the Iranian authorities were “thriving” on Telegram, using the platform to identify and shame protesters and even broadcast forced confessions. Coordinated disinformation campaigns are also a preferred tactic of the authorities. In a recent piece for the Atlantic Council, Alimardani described how the regime now routinely “floods” online spaces with messages and accounts that are designed to leave the opposition “distracted, disunited, and chaotic.”

And technical surveillance has been on the rise too. A few months after the protests began, it came to light that authorities were finding women who appeared with their heads uncovered in photos or videos posted online and using facial recognition tools to identify and pursue them for violating the law. Just yesterday, legislators approved a bill — dubbed the “hijab and chastity law” — that will jack up penalties for hijab law violations, require businesses to enforce the law and “create and strengthen AI systems to identify perpetrators.”
This week, you can find manyreflections across the web on what the movement means, one year on. The biggest takeaway for me is that while the Iranian regime hasn’t fundamentally changed, Iranian society unquestionably has — and, at least for the current generation, this change may be irreversible. As Iranian journalist Golnaz Esfandiari put it on NPR, “I don’t think people can go back to the way they were.”

GLOBAL NEWS

Will a new censorship regime really make British kids safer? On Tuesday, U.K. parliamentarians passed the hotly-debated Online Safety Bill that will require big social media platforms — and lots of other websites — to perform age checks for all users and somehow remove all content that could be harmful to kids before it appears online. It’s easy to agree that material promoting violence, suicide and disinformation is bad for kids, but screening for this kind of stuff will be the challenge of the century. Outside of China, where censorship really does come first, there are no major platforms that do this. That will have to change if the big players want to stick around in the U.K., and it will probably cause the platforms to censor lots of serious and legitimate stuff. 

The law could also leave smaller, alternative sites in a lurch. Wikipedia has said that depending on how the law is enforced, it might have to leave the U.K. altogether. On top of all that, it’s still not clear how the law might affect secure messaging apps. In recent months, both WhatsApp and Signal threatened to pull out of the U.K. should the government force them to screen messages for harmful content. Signal President Meredith Whittaker has already said that this option is still on the table.

Israeli lawmakers may soon be using more surveillance technology in public spaces across the country. National Security Minister Itamar Ben-Gvir is promoting a draft law that would allow the police to deploy facial recognition-enabled surveillance cameras in public spaces across Israel to “track the identity and location of suspects in the commission of crimes” and to aid in the “prevention of crimes.” Israeli authorities have used a variety of invasive surveillance tools in their occupation of Palestinian territories for some time. This move would broaden the state’s digital gaze, ensuring that just about everyone living on land controlled by Israel is under some surveillance. The shift gives credence to the notion that when invasive technologies are used to monitor people whose rights are limited or unrecognized in some way — whether they’re Arabs in Israeli-occupied Palestine or Uyghur Muslims in western China — they may soon be deployed and applied to the broader public.

Israel evidently wants to deepen its ties with other parts of the tech industry too. Earlier this week, Israeli Prime Minister Benjamin Netanyahu met with Elon Musk and Open AI co-founder Greg Brockman to discuss “AI safety.” This was quite the eyebrow-raiser, when you think about Musk’s predilection for posting and promoting antisemitic messages on X and his recent threat to sue the Anti-Defamation League for its research on hate speech, which tracks racism, homophobia and antisemitic speech online. None of this stopped Netanyahu from taking the meeting — another eyebrow-raiser — though he did bring up the issue and pressure Musk to do more about it. Don’t hold your breath, Bibi.

The post Tech is still critical for Iran’s protest movement — and its regime appeared first on Coda Story.

Guarnieri and Wieder originally brought their case to the U.K.’s Investigatory Powers Tribunal in 2016, in what amounted to a test of the system in the wake of the Edward Snowden revelations, which exposed the large-scale spy programs of not only the U.S., but also the U.K., Australia, Canada and New Zealand governments. When the Tribunal refused to hear their case, they took it to Strasbourg. Even though the two plaintiffs aren’t U.K. citizens, the court decided they still had some baseline rights to privacy under the European Convention on Human Rights.

There’s a difference between governments hoovering up data as a routine practice and immigration agencies tracking individuals after they cross a border, but the case should set some precedent concerning the data privacy rights of non-U.K. citizens once they’re in the U.K. What might this mean for migrants coming to the U.K. from across the globe in pursuit of a better life? In a world where everyone depends on internet-based tools to communicate, travel, work and earn money — tools that collect gobs of data about us along the way — the question feels pertinent.

The surveillance industrial complex should be top of mind in the U.S. too, as we learn more about border security and management agencies’ exploitation of digital data to surveil people trying to enter the U.S. In Texas, it came to light in late August that a group of Texas National Guard members — acting within Governor Greg Abbott’s controversial state-run border mission — had carried out an unauthorized spy operation in which they deliberately infiltrated WhatsApp groups used by migrants and smugglers to communicate about their routes. 

I’m not sure which is worse — WhatsApp infiltration or border agencies creating fake social media profiles in order to “research” people who are seeking residency in the U.S. through established legal channels. The latter strategy, by the way, has been deployed not as part of some rogue Texas border operation but under the auspices of the U.S. Department of Homeland Security. Critical details about the program surfaced last week, thanks to a series of open records requests filed and obtained by NYU’s Brennan Center for Justice. 

On a somewhat brighter note, last week, U.S. Customs and Border Patrol publicly vowed to stop buying troves of people’s location information from data broker companies like Venntel by the end of this month. How are third-party companies you’ve probably never heard of getting their paws on your data? Too often, when you sign up for a new digital service and “agree” to its terms and conditions, you have no choice but to authorize the service to sell your data to companies like Venntel, which will analyze and repackage it for sale to the highest bidder. At least soon, if they do as they’ve promised, CBP won’t be one of them.

GLOBAL NEWS

Pegasus, one of the world’s most pernicious surveillance technologies, infected the iPhone of acclaimed Russian journalist Galina Timchenko. On Wednesday, researchers at the University of Toronto’s Citizen Lab and Access Now released technical evidence that Timchenko’s phone was compromised in February 2022. This is big, not only because of Timchenko’s unique position as the co-founder of the leading Russian independent media outlet Meduza, which operates out of Latvia, but because Pegasus, built by Israeli spyware firm NSO Group, has publicly stated that it won’t deploy its products in Russia or the U.S., or against people from these countries, presumably due to pressure from the Israeli government. In Meduza’s coverage of the revelations, Timchenko described feeling both terrified and defiant about the discovery. “Just what were they planning to find? They put me under a magnifying glass, hoping to catch something… Go ahead and watch, you creeps! Feast your eyes,” she said.

Experts have been saying it for a while, and the public is catching up: AI is going to mess with elections. A new Axios-Morning Consult poll shows that half of Americans think AI will help spread disinformation in the lead up to the 2024 general election in the U.S. and that this will affect election outcomes. They’re right to worry, especially since X (formerly known as Twitter) is planning to open the floodgates and reinstate political advertising on its platform. Though it is growing crummier by the day, I think it’s safe to assume that what appears on X will still have a significant impact on what the media decide to cover and what voters believe to be true. And I’m not sure if X is actually shadowbanning the New York Times, but Musk’s attacks on the newspaper, and the fact that their traffic from Twitter has dropped substantially since late July, don’t look good. While it’s one among many reliable sources out there, it’s icky to think that U.S. voters might be less likely to read the New York Times because Elon tweaked the system out of spite.

U.S. v. Google: It’s finally happening. The U.S. Department of Justice will officially see Google in court this week, in the first of three upcoming antitrust cases against the $1.7 trillion tech behemoth and the first such case brought against any major tech company since the government sued Microsoft in 1998. This case will focus on Google’s search engine, which, the DOJ argues, the company has unfairly elevated to monopoly status by brokering deals with mobile phone and browser service providers to set Google as their default search engine. The company commands 90% of the search engine market in the U.S., and 94% of it globally. Google argues that it simply offers the best service in the industry and people use it because they love it. 

Tech Policy Press and Ars Technica have put out helpful “what to watch for” pieces about the trial. But the trouble is, the public won’t be able to watch for much, since Google convinced Judge Amit Mehta to keep the trial closed to the public, on the grounds that the company’s precious “trade secrets” might otherwise be compromised. Early next year, the courts will hear another case that the DOJ is bringing against the company, concerning its hyperdominance of the online advertising market. I’m even more excited for this one.

WHAT WE’RE READING

• I am crushing hard on 404 Media, a new tech news venture of VICE Motherboard alums like Joe Cox, Jason Koebler and Samantha Cole, who wrote this excellent and hilarious piece about the scourge of AI-generated mushroom foraging books on Amazon. The president of the New York Mycological Society says the books offer imprecise or flat-out wrong advice on what to pick and what to avoid. The TLDR here is that if you eat the wrong mushroom, you will die. So consider the source!

• On that note, I think my friend Ethan Zuckerman is right to worry about AI getting to train itself. He’s written a piece about it for Prospect.

• And as usual, I am all for popping the chatbot hype balloon, which Sara Goudarzi is conveniently advocating at the Bulletin of the Atomic Scientists. Give her essay a read.

The post The surveillance industrial complex is thriving at the border appeared first on Coda Story.

The summer is over and the secret is out about Flannery Associates, the once-mysterious company that has bought thousands of acres of land east of the San Francisco Bay as part of a Silicon Valley billionaire-backed venture to build a “new California city.” The New York Times reported in late August that some of the industry’s biggest names — including Reid Hoffman, Marc Andreessen and Michael Moritz — plan to build a techno utopia in largely rural Solano County and have already spent around $800 million to make it happen. Investors and other sources familiar with the pitch said the new city was billed as a bustling metropolis that would bring thousands of jobs to the area, be “as walkable as Paris” or New York’s West Village and even help solve the Bay Area’s housing crisis.

This kind of magical thinking is nothing new — it has deep roots in northern California, and in some ways it echoes visions of a utopian cyberspace that people like Electronic Frontier Foundation co-founder and Grateful Dead lyricist John Perry Barlow espoused. But the kind of undertaking that Flannery Associates has in mind takes a special kind of hubris and a ton of money. The hubris and the money are not new for people of this ilk. But the effects of their actions are becoming bigger and more consequential for the rest of us.

Indeed, a new kind of utopia seems to be emerging, whether in Solano County, California or in Saudi Arabia’s Neom, which my colleague Oliver Bullough described earlier this week as “a blandly-named but horrific new city that Saudi Crown Prince Mohammed bin Salman has decided to build in the desert because he can.”

But why limit yourself to earthly endeavors? This must have been the question on Elon Musk’s mind when he built SpaceX. In space, there is literally no one to answer to. Musk, the ultimate techno utopian conquistador of our times, can do almost anything he wants. And he has.

Starlink, the satellite internet service offered by Musk’s SpaceX has shot roughly 4,000 satellites into low Earth orbit, far outnumbering all the other satellites by impressive margins, and he plans to launch plenty more in the coming years — up to 42,000. Meanwhile, China plans to create its own satellite internet service with a “constellation” of nearly 13,000 small satellites that will have to find a way to share the orbit with Musk’s Starlink battalion.

How humans are engaging with space, specifically in low Earth orbit — a place where, unlike in cyberspace, there is no real jurisdiction or system of governance — is a compelling question for anyone interested in forging new social systems or societies.

Science writer Sarah Scoles brought us a sharp new feature this summer wrestling with some of the hard realities of the new space race. Who can send satellites into space? What do we do when two satellites get in each other’s way? How do we handle the rapidly accumulating debris from satellite crashes of the past? When you think about all the things that satellites provide for us on Earth — from internet access, to GPS technology, to communication networks for conflict zones — it’s not so hard to see why we should care about what happens up there. Sarah’s piece gives us a glimpse into the potentially catastrophic future that may unfold in space if governments and companies don’t figure out how to answer these questions, fast. It also makes a great companion to some of the summer’s deep dives on Musk’s power in the stars, from the New York Times and The New Yorker.

I see the evolution of the internet as a cautionary tale for the new space race. In the early 2000s, the civil libertarian spirit that defined the early internet and inspired communities like Barlow’s largely gave way to a culture and legal ethos firmly tied to the tenets of free market capitalism and an expectation of lax or no regulation. Fast forward to last year’s Twitter takeover, and we the internet users find ourselves at the mercy of people like Musk. Since he snapped up one of the world’s most powerful platforms for free speech and information-sharing, Musk has essentially dismantled it, because he can. Chew on that the next time you gaze up at the stars.

GLOBAL NEWS

Big Tech is literally in space, and virtually in the cloud, but these companies also have a huge footprint on Earth — the quantities of data that Google and Microsoft wield require massive data centers that generate a lot of heat on the ground. How do we cool them down? Water is an effective solution, of course, but it too is an exhaustible resource. In southern Uruguay, Google has plans to build a data center that would require an estimated two million gallons of tap water a day to keep its servers cool. Last month, Uruguayans facing the country’s worst drought in 74 years took to the streets of Montevideo to voice their anger and frustration over the water shortage and the impending Google contract. The company and Uruguayan officials say they’re looking for ways to reduce the burden on the country’s water supply, but the bigger issue isn’t going away. And Uruguay is just one among dozens of countries experiencing the environmental effects of Big Tech.

Another one is Saudi Arabia, where both Google and Microsoft have set up data centers over the past two years: I wrote about this in more depth in June. But this isn’t the biggest story out of the kingdom this week.

X is facing new allegations that it looked the other way when the Saudi government infiltrated the company to spy on its critics back in 2015. A new court filing in the 2019 bombshell case against X purportedly includes evidence that the company, then known as Twitter and under Jack Dorsey’s leadership, either knew or willfully ignored the fact that two Saudi Arabian employees were working on behalf of the Saudi government to gather up the data of an estimated 6,000  users who criticized the regime. Washington Post columnist Jamal Khashoggi, who was murdered and dismembered at the Saudi consulate in Istanbul, was one of them. Lest anyone think that those grisly days are somehow behind Crown Prince Mohammed bin Salman, a Saudi court sentenced a retired schoolteacher to death for his activities on X and YouTube just last week. Muhammad Al-Ghamdi is the brother of a Saudi scholar who lives in the U.K. and runs Sanad, a group that advocates against human rights abuses in Saudi Arabia and the Gulf.

The post How earthly notions of conquest — and Big Tech power moves — are playing out in the stars appeared first on Coda Story.

I’d like to think, because of the work I do, that I’d be immune to the gravitational pull of money, but I’d probably be lying. On the rare occasions when I’ve met someone wealthy — and they’ve been multimillionaires, rather than centibillionaires, and thus nowhere close to the lower reaches of the Forbes list — I can’t help noticing that slight tug as my brain says: “Just think of what could be achievable if I could persuade this person to invest in one of my pet projects.”

Which is all to say that, although I’d hope I could resist the lure of the vast mass of Saudi money if I was confronted by it, in reality, I’m not sure I wouldn’t throw myself in and start doing lengths like Scrooge McDuck. That’s certainly what everyone else seems to be doing. So, it’s time to check in once more on Neom, the blandly-named but horrific new city that Saudi Crown Prince Mohammed bin Salman has decided to build in the desert because he can:

• “Con Air” director Simon West is set to film a historic drama, “Antara,” in Neom.
  
• Sindalah has partnered with prestigious JLS Yachts as Neom’s first superyacht destination gears up for opening. “With 86 berths for yachts up to 50 meters and additional serviced offshore buoys for superyachts up to 180 meters, the Sindalah marina will become a new hub for the global yachting calendar,” the press release reads.
  
• A tunnel contract is up for grabs at Neom’s port city, Oxagon: “The tunnel will link the offshore elements of Neom’s floating port city Oxagon in the Red Sea with the Neom Connector – a high speed railway that will connect Oxagon with its linear city, the Line.”
  
• Neom is touted as a potential host for the 2034 World Cup.
  
• The NEOM McLaren Formula E Team has unveiled a motorsport livery designed using generative artificial intelligence.
  
• South Korean robot maker takes part in supermassive Saudi development Neom.
  
• Neom, the $500bn megacity, which organizers claim will be 33 times the size of New York City, is due to include a 105-mile straight-line city.

I could go on, but you get the point. A lot is happening, and it is all bewildering. There is a film production hub, a new harbor for superyachts, a high-speed railway, a new port city, a sports venue and a new city that will run for 100 miles in a straight line. A couple of months ago, I was in the Marshall Islands, which is a series of atolls in the Pacific Ocean, where the capital city — Majuro — is long and thin, making it extremely time-consuming to get anywhere and thus incredibly impractical. The Marshallese had no choice about its shape, however, because the island is the rim of a submerged volcano, rarely more than 656 feet wide at any point, and Majuro could only be built where the land was. The Saudis, however, are choosing to build a city in a way that is guaranteed to ensure the longest possible journey times, for no apparent reason. I could understand someone designing it in Minecraft, but why are real-life engineers willing to participate in such an absurd idea?

And that’s just the start of it. Why are engineers building a skiing venue, which will host the Asian Winter Games, at a time when — thanks to climate change — even the Swiss are struggling for lack of snow? Why have other engineers decided to build a waterfront for a region of Jeddah that has no waterfront? Why are soccer players who used to wear rainbow armbands willing to play in a country where homosexuality is illegal?

• “I think people know what my views and values were before I left and still do now. And I think having someone with those views and values in Saudi Arabia is only a positive thing. I can’t promise anything, but what I can do is sit here and say I have my values and beliefs,” English player Jordan Henderson said.

That seems like a quote that sums up nicely why people, from golfers to mixed martial artists,  choose to work in Saudi Arabia — it’s all about the gravitational pull of colossal amounts of money.

• “A lot of people who said, ‘We will not work in Russia because of Putin,’ are now working in Saudi Arabia,” said Austrian architect Wolf Prix, who helped to design the linear city and is, at least, consistent in his willingness to accept money, since he has also designed an opera house in Russian-occupied Crimea. “I’m not glorifying anyone who acts in an authoritarian way…Once and for all: Architecture is art and art knows no sanctions or borders,” he has said.

It’s a noble-sounding philosophy, but it’s not exactly Paul Simon performing with Ladysmith Black Mambazo, is it?

There are many good reasons to support the urgent creation of renewable energy systems, and not least among them is the need to stop giving money to tyrants who happen to sit on vast fossil fuel reserves. Last year’s profits for Saudi Aramco — $161.1 billion — were the largest ever reported by any company.

If the Saudi royal family was no richer than any other government, then perhaps any artists who “know no sanctions or borders” might choose to side with the three people who have been sentenced to death in Saudi Arabia because they objected to Neom being built, rather than with the government building it. Their names are Shadly Ahmad Mahmoud Abou Taqiqa al-Huwaiti, Ibrahim Salih Ahmad Abou Khalil al-Huwaiti and Atallah Moussa Mohammed al-Huwaiti.

• “Despite being charged with terrorism, they were reportedly arrested for resisting forced evictions in the name of the NEOM project and the construction of a 170km linear city called The Line,” a specially convened group of U.N. experts said. “We urge all companies involved, including foreign investors, to ensure that they are not causing or contributing to, and are not directly linked to serious human rights abuses,” they added.

TAXES

This is potentially exciting: The Financial Accounting Standards Board, which lays out how accountancy rules work in the U.S., has decided that American companies should publicly declare not only how much they pay in taxes but where they pay it, rather than providing that information solely to the tax authorities.

The measures have been under discussion for seven years, with many companies opposed to the idea of revealing any more than they already do, but pressure from investors appears to have finally got a slightly watered down version of the standards over the line.

• “Time and time again investors have made it clear that they need a closer look into the tax practices of the companies in their portfolios,” said Ian Gary, the executive director of FACT. “Now, after years of deliberations and revisions, FASB is finally delivering some of these much-needed reforms for investors and the public.”
  
• “We believe more aggressive management of tax issues could, at times, provide evidence that a company’s management team and board may have a risk tolerance that is greater than we would prefer given our long-term (often 6-8 year) average holding period,” said one investor in comments quoted by the Wall Street Journal.

Country-by-country reporting was first suggested by campaigners two decades ago as a solution to the way multinational companies were able to use accountancy tricks to move profits from high-tax countries and thus dodge the taxes that pay for public services.

• “To truly eliminate profit shifting and stop trillions from being stashed in tax havens, we must make robust, public country by country reporting a requirement for all multinational corporations everywhere,” the Tax Justice Network says.
  
• “At the core of the demand for country-by-country reporting is a contention that globalization is not working for the benefit of everyone. Some nation states and large parts of the world’s population have lost out as the power of the global corporation has risen, including its power to not pay tax in the right place at the right rate and at the right time,” said Richard Murphy, the accountant who first came up with the idea.

Although initially dismissed as an impractical dream, the idea has gradually become reality around the world, and producing a non-public report to be shared with tax authorities is now a requirement of the OECD. In the European Union, rules will apply, from next year, obliging companies to publicly report taxes separately for each member state, as well as for jurisdictions the bloc labels as “non-cooperative.” Other countries are inching toward public reporting of their companies’ taxes as well. Does it work? Well, not yet.

• “Our results collectively suggest that U.S. Multi-national Enterprises continue to engage in tax-motivated income shifting after U.S. CbCR adoption,” one paper finds.

But perhaps, like communism or Brexit, that’s because it hasn’t been tried properly.

SINGAPORE

It’s all going on in Singapore, where a large money laundering ring has been busted and an investigation continues. It’s not exactly a surprise to anyone that dirty money is flowing through Singapore, but I was interested by the details of the passports held by the suspects.

• “Ten foreigners aged between 31 and 44 were arrested, from Cyprus, Cambodia, Dominica, China, Turkey and Vanuatu,” Reuters reports.
  
• “Turkish national Vang Shuiming, 42 …. also has passports from China and Vanuatu,” according to the Straits Times.

• “A 40-year-old Cypriot national … jumped out of the second-floor balcony of his bungalow and was found hiding in a drain,” ABC writes.

What do all of those countries, except China, have in common? They are all places that sell (or have sold) passports under citizenship-by-investment schemes. Such golden passport schemes are controversial, but their proponents argue that countries should be able to award citizenship however they like, that robust due diligence programs ensure criminals are excluded from obtaining identity documents and that such schemes help to correct the unfairness inherent to different passports offering different travel privileges.

And yet, I do not know of a single country that has sold passports, which hasn’t ended up selling them to criminals.

Kristin Surak, an academic from the London School of Economics, has a book coming out this month on this very topic, and if you’re interested, you should read it. Her key conclusion is that, no matter how many such scandals we see, golden passports are not going away.

• “In some Caribbean microstates, citizenship by investment constitutes as much as 30 percent to 50 percent of GDP, making the programs extremely important economic resources for development,” Surak says. “In essence, this is an issue of capitalism, which needs nation-states in order to operate. States are necessary because they back up legal jurisdictions and laws protecting ownership and private property. And states get their power from bounding, claiming, and limiting populations. As long as the intertwined relationship between capitalism and nation-states persists, we will see the demand for golden passports grow.” 

WHAT I’M READING

I’m plowing my way through “The Secret History of the Five Eyes,” which traces the origins of U.K, U.S., Australia, Canada and New Zealand’s intelligence cooperation to the years preceding World War II, then races through various scandals, cock-ups, conspiracies and disasters up to the present day. I’m keen to see how the five Anglophone nations cooperate against money laundering, and this is tangentially relevant, though — to be honest — it feels a bit like this book would need to be about 20 times longer than it is to have a hope of fitting everything in.

The post Why Saudi money is so hard to refuse appeared first on Coda Story.

People keep asking me what I think about Yevgeny Prigozhin’s death, but I don’t really feel like I have anything to say except that it heralds nothing good. An autocracy where leading insiders are killed in horrible ways is neither stable nor predictable, and that is the worst kind of autocracy. That Vladimir Putin felt the need to kill Prigozhin so grotesquely suggests that Putin is increasingly nervous and twitchy.

It feels like a long time ago, but the Russian president used to have a reputation among Westerners as a preternaturally gifted three-dimensional chess player; a master strategist who saw around corners. It was an impression that I never held, having seen Putin being unimpressive in person too many times. But now to everyone he must seem like a toddler hitting the chessboard with a mallet.

Many oligarchs will currently be feeling the kind of nerves that Roman patricians will have felt during the reigns of the more depraved emperors. Putin will be hoping that the assassination of Prigozhin will keep them all in line. There is, though, perhaps a small silver lining hidden within that comparison. Unlike first-century Rome, 21st-century Moscow is not a global center of civilization, wealth or culture. Several other places could provide just as attractive a home to those oligarchs should they decide to leave.

Western governments should be reaching out to those Russian insiders who are not war criminals and offering them a way out if they break with Putin, condemn the war, assist Ukraine and help Western law enforcement agencies to track down the Kremlin’s assets. Sanctions were always supposed to split the Russian elite, which is something that would help undermine the Kremlin’s ability to wage war. And something we should always bear in mind.

CBDC: IT’S A FOUR LETTER WORD

Along with cryptocurrencies, central bank digital currencies (CBDCs) have always seemed to me like a solution in search of a problem. We already have digital payment systems that work perfectly well, so what exactly is the point of the Federal Reserve, the Bank of England or the European Central Bank recreating them with software systems of their own? Central banks have said that they’re keen on maintaining the security of the financial system, as well as ensuring that everyone has access to a payment mechanism, but it does all seem a little vague (judge for yourself here, or here, or here).

So, thanks to the Financial Times for this fascinating piece looking at the issue from the perspective of Beijing, which is well advanced in its quest to create a fully digital yuan.

• “The aim is not to depose the dollar but to chip away at its dominance — and, crucially, to create enough space for China’s economic survival if the U.S. one day targets it with the type of sanctions it has imposed on Russia.”

Finally, CBDCs make sense to me. Duh.

Before February 2022, the Kremlin thought that the Russian Central Bank’s giant war chest of foreign exchange reserves would insulate its economy from any Western sanctions if it launched a full-scale invasion of Ukraine. Western countries’ decision to freeze those reserves came as a nasty surprise, which has only been made nastier by suggestions that Russian reserves be invested and that the income generated be used to support Ukraine. (Question to knowledgeable readers: Why was more than half of the frozen 300 billion euros in Belgium of all places?)

China’s foreign reserves dwarf those owned by Russia — they were worth $3.2 trillion in July, according to official statistics; $4 trillion if you include Hong Kong; and $6 trillion if you include “hidden money”. So the prospect of them being frozen by Western sanctions is an alarming one for Chinese policymakers. And that’s why the “e-yuan” is so potentially powerful, since it would form the backbone of an independent payment system entirely outside the control of Western governments, and thus immune to sanctions.

Aha, sanctions again.

A fanatic is someone who can’t change his mind and won’t change the subject. (It’s a line attributed to Winston Churchill, but then so many are that it’s anyone’s guess who first said it.) I fear that my opposition to the Western habit of using sanctions as the primary tool against kleptocracies is inching dangerously close to fanaticism. 

However, I do think that this is a perfect demonstration of the dangers inherent in relying on sanctions as much as we do. Controlling the global financial system is a priceless resource for Western countries (above all for the United States, thanks to the role of the dollar as the world’s reserve currency), and it is a power that should be protected and used only in extreme circumstances. If Western governments use sanctions too much, that will just encourage non-Western countries to develop separate financial systems of their own. Relying on sanctions as the primary tool feels like overprescribing antibiotics to fatten up pigs. A time will come when we’ll really need them, and they won’t work anymore.

Among the many problems that an e-yuan would cause would be to defang U.S. law enforcement, which has in the past relied on the fact that corrupt transactions are often denominated in dollars to claim jurisdiction and thus prosecute cases that would otherwise have been ignored by everyone else.

Among such cases were the charges brought in 2014 by the FBI against the billionaire Ukrainian gas tycoon Dmytro Firtash. Although prosecution hasn’t yet gotten underway because he is still battling extradition from Austria, he has at least been removed from Ukrainian politics for most of the last decade. His focus has instead been largely on his own legal troubles. Earlier this year, he retained the Texas politician-turned-lobbyist Ben Barnes to try to negotiate a plea deal. Firtash denies any wrongdoing, but appears to be hedging his bets in many directions. According to Deutsche Welle, he also apparently sought to gain diplomatic immunity via an appointment to a Belarusian mission in Vienna, to prevent his extradition.

As I’ve said many times in this newsletter, the Ukraine crisis should provide Western countries with the impetus they need to properly invest in investigating and prosecuting financial crimes. The FBI’s investigation into Firtash lasted years and is an example of what a properly resourced agency can achieve. What does an insufficiently funded law enforcement system look like? It looks like one where a major agency is forced to drop an investigation after a decade of work because of “insufficient admissible evidence”.

Even as sanctions have become the primary tool used by Western governments to restrain kleptocratic networks like those run from the Kremlin, we should remember that they are a tool of foreign policy, not law enforcement. As such, it is completely fine for sanctions to be canceled, modified, expanded or removed if governments decide they should be. For instance, I think Arkady Volozh, the Israel-based founder of Russian search engine Yandex, should be rewarded for condemning the Russian aggression against Ukraine, because removing the sanctions against him would encourage other billionaires to switch sides – which is what we want to happen.

Yes, it might feel icky, and I’m sure there would be anger in Ukraine and elsewhere if anyone were removed from the sanctions list. But the aim has always been to change behavior, not to bring criminal prosecutions. If the behavior changes, then the sanctions should be scrapped (on the understanding that they can always be reimposed), in the interests of ending the war as quickly as possible.

On that note, this is a smart column from Josh Rudolph on how aid-giving Western governments should demand that Ukraine take stronger anti-corruption measures.

• “Congress should ease the political pathway toward additional security assistance by imposing anti-corruption conditions that back Ukrainian investigators, prosecutors and judges in their battles against oligarchs and corrupt officials. Ukrainian civil society would be grateful and Putin would have a conniption.”

MONEY LAUNDERING

As I’ve mentioned before, I’m currently researching a book on money laundering. One topic that has gained very little attention from, well, anyone really, is trade-based money laundering (TBML), an unwieldy term for a slightly paradoxical phenomenon: the movement of value around the world through commodities, rather than through the financial system. Think of it as barter for cartels, but infinitely complex and absolutely vast.

• “TBML is likely one of the largest forms of money laundering. In addition, as countries have strengthened their controls to combat other forms of money laundering, various U.S. government reports and officials, as well as knowledgeable sources have stated that there are indications that criminal organizations and terrorist organizations have increased their use of TBML to launder their funds,” a Government Accountability Office report states.

The reason I mention it is because  respected British think tank RUSI has published a report summarizing a discussion it hosted with industry and law enforcement professionals over how to address the problem, which is handy as the U.K. is due to host a global TBML summit later this year.

Part of the problem with TBML is that, unlike money laundering via the financial system, it is hard to analyze since the trade system is fragmented, non-standardized and opaque. The data is therefore of poor quality and participants are not particularly interested in cooperating with the authorities. You could sum up the report by saying that no one knows what’s going on, how to find out what’s going on, or sufficient money to invest in building structures that could try to find out what’s going on.

This is unfortunate since TBML is increasingly how representatives of regimes shut out of the formal financial system move their wealth around the world, whether that’s Iran or North Korea or Chinese oligarchs trying to evade Beijing’s capital controls. And, to make this even more complex, TBML is not just one thing, as the RUSI report lists four separate manifestations of the phenomenon that are so different that they almost deserve their own names.

• “The physical movement of goods with over- and under-invoicing to move the value across borders.”

• “Entirely fictitious shipments, with no goods moving across borders, simply a ‘trade’ transaction used to obfuscate the movement of funds (‘ghost shipments’).”

• “Black Market Peso Exchange (BMPE) and analogous systems, which involve no cross-border transactions or movements of cash, but the integration of cash into high-value goods markets and the shipment of goods across borders as a representation of value.”

• “Service-based money laundering: cross-border payments for fictitious services, with no movement of goods.”

This is important. There is no doubt that Russian money launderers will be shifting value around the world via deliberate over and underpricing of commodity exports, in order to buy the weapons and high-tech components they need to kill Ukrainians. Targeting TBML is central to targeting the Kremlin war machine. In short, if we want to understand kleptocracy, we simply have to understand how oligarchs move their wealth. So if you happen to control access to research grants, please divert some towards academics who are attempting to understand what’s going on in the trade system.

WHAT I’VE BEEN UP TO

This section is normally about what I’ve been reading but, full disclosure, what with the kids at home for the holidays, a whole lot of work to catch up on, endless interviews to transcribe, and friends staying for the long weekend here in the U.K., I’ve read almost nothing in the last week. I did, however, cook a really good chana masala on Saturday night, which involved reading the recipe in Grace Regan’s “Spicebox” cookery book. I highly recommend it, particularly if you serve it with onion bhajis.

The post Why China’s e-yuan is a shield against Western sanctions appeared first on Coda Story.

It is good news for the Western coalition seeking to strangle the Russian economy, that a judge upheld the U.K. sanctions imposed on Eugene Shvidler. Shvidler, a billionaire who has held senior positions in oil company Sibneft and metals giant Evraz, was designated by the U.K. last year because of his close relationship to Roman Abramovich. Had Shvidler won, it could have unleashed a torrent of similar appeals, at a time when the anti-Kremlin coalition needs as much help as it can get.

The judgment is careful and thorough and worth reading in full. (Although some observers may question the wisdom of the judge’s statement that “this is an area where the Courts have to defer to the judgment” of the foreign minister, considering that the minister in question in early 2022 was Liz Truss, who later that year became the most disastrous prime minister in British history.) 

A U.S. and U.K. citizen, Shvidler was the first sanctioned individual to bring a legal challenge against his designation. Had he been successful, it would have been a major threat to the ability of the U.K. to run its post-Brexit sanctions regime and thus to the integrity of the West’s attempted blockade of the Russian economy. Shvidler’s lawyers at Peters & Peters intend to appeal though it’s hard to see much grounds for them to be optimistic, since they seem to be mainly asking for sympathy.

• “The impact of this on him and his family is extreme and far-reaching,” said Michael O’Kane, one of Shvidler’s lawyers. “If this judgment stands, it will make it virtually impossible for any person sanctioned by the Foreign Secretary to bring a successful court challenge.”

It is easy to sympathize a little with the plight of Shvidler’s family: two of his children lost their places at British private schools at important stages in their education and had to move to the United States, which means they rarely see their British-based mother, who lacks U.S. citizenship, and who is now herself struggling to obtain legal or banking services in the U.K.

However, the difficulties that Shvidler himself faces, though no doubt distressing for him, go straight past being #firstworldproblems to become a whole new hashtag of its own. Here, summed up, are his #oligarchproblems:

• “He can no longer access financial institutions he has used for many years; his registered agents in the British Virgin Islands have given notice of their intention to resign; his two private aircraft have been grounded, and he has been unable to pay the expenses necessary to ensure his private yacht is safe and seaworthy,” the judgment notes. Shvidler has also “had difficulty maintaining and insuring his properties in the UK,” forcing him “to make redundant a number of members of his household staff.”

How bad do you feel for Shvidler on a scale of 0 to not-very-sympathetic?

Reading the judgment did, however, reinforce my opinion that sanctions are simply no substitute for a rational, long-term, well-resourced approach towards the challenges to democracy posed by oligarchy, kleptocracy, financial crime and dirty money in general. Shvidler sat on the board of Evraz, where Abramovich is the largest shareholder. Also on the board sat Sir Michael Peat, previously principal private secretary to HRH the Prince of Wales. Evraz was listed on the main London Stock Exchange and, as a director, Shvidler was the nominee of a company registered in the British Virgin Islands. He had entered the U.K. as a “highly skilled migrant” in 2004, becoming a citizen six years later and giving millions of pounds in philanthropic donations to educational institutions. He was in short very welcome in the U.K. Until suddenly he wasn’t.

It all feels a bit like inviting someone to live with you, then refusing them access to the fridge because you’ve suddenly decided you don’t like a friend of one of their friends.

Throughout this period, all of the information that the U.K. government relied on to add Shvidler to the sanctions list in March 2022 was known. It was no secret that he was close to Abramovich, since he was vice president for finance at the oligarch’s oil company back in the 1990s. It was no secret either that Abramovich was close to Putin, who appointed the oligarch as governor of a remote Russian region. And it was no secret what kind of leader Putin was: his regime flattened Grozny, jailed opponents, had Alexander Litvinenko murdered, allowed insiders to steal vast fortunes, invaded Georgia in 2008, annexed Crimea in 2014, then invaded Eastern Ukraine and shot down MH-17 later that year, among many more crimes.

Of course, it’s good that Western governments responded to the full-scale invasion of Ukraine by attempting to isolate the Russian economy, and undermine Putin’s ability to wage war, but we should learn from this that we should never have stood by and watched Putin build his kleptocratic regime in the first place. Or allowed the oligarchs to so deeply infiltrate the West. The fact there was so much wealth available to be sanctioned is a sign of failure, not of success.

The Shvidler judgment is akin to being allowed to prolong the imprisonment-without-trial of someone arrested inside a fortress. It should not be grounds for self-congratulation, but should instead provide the impetus to urgently repair the fortress walls, to train people to defend those walls, to install equipment to prevent tunnels being dug beneath the walls, and to check if anyone on our side is taking money from our enemies. None of this is being done.

Incidentally, although Peters & Peters failed in their legal challenge on behalf of Shvidler, last month they did better for another client — Lev Khasis, formerly first deputy chairman at Sberbank, who has been removed from the sanctions list. The British government provided no reasons for why he had been de-designated, but it has previously been reported that Khasis fled Russia around the time of the full-scale invasion in February last year. According to the Miami Herald, he’s living in his $3.4 million condo in Miami.

…AND IN RUSSIA

Russia has launched a criminal case against its richest man, Andrei Melnichenko, for supposedly corruptly colluding with a government minister in his purchase of a power plant. This is confusing on the face of it, since government ministers in Russia are more than happy to corruptly collude with billionaires, but appears to be all part of the shifting dynamics of the war economy. Melnichenko has also been targeted in the West, and is sanctioned in Europe, in Canada, in the U.S. and in the U.K., so he may now be feeling a little squeezed.

I would not be surprised to see the case settled in return for Melnichenko handing over some share of his assets to the Kremlin, but it will be interesting to keep an eye on this one, as a pointer to whether oligarchs are able to retain their charmed positions despite being sanctioned. If Melnichenko can continue to hold his assets outside Russia — he has moved to the UAE, since being forced to leave Switzerland, according to the New York Times — then he is at least theoretically still able to act independently of the Kremlin.

ANTI-CORRUPTION COURT

What is stopping Western governments from adequately tackling dirty money? One of the key reasons I hear from officials and others is that the problem is so hard that, if adequate efforts were made to tackle it, they wouldn’t bring results until long after the politician who made them would have left office. Politicians want “announceables” — things that make good press releases — they don’t want to put in years of effort only for someone else to get all the credit.

People whose opinion I respect think an International Anti-Corruption Court (IACC) is the answer to this problem, since it would remove the fight against financial crime from the domestic political arena, and entrust it to a mighty multinational apparatus. And the suggestion is now winning support in the U.K., on top of previous backing in the Netherlands, Ecuador, Canada and among some U.S. lawyers.

• “Labour will join calls for the establishment of an international anti-corruption court. Designed to prosecute the most egregious acts of corruption. The kleptocrats, the most corrupt businesspeople and those who enable them. Labour is determined to clean up the London Laundromat at home and defeat kleptocracy around the world,” said David Lammy, who will be U.K. foreign minister if — as currently looks likely — the Labour Party wins next year’s general election.

The model is the International Criminal Court, which has brought cases and launched investigations into the most egregious violators of human rights in Central Africa, South America, Ukraine and parts of Asia. The IACC’s backers argue that a similar international court would provide equivalent accountability in places where governments are complicit in abusing their citizens via corruption.

But I think that comparison is flawed. The crimes associated with grand corruption are different to human rights abuses, which take place in a defined place in a single country and can thus be prosecuted like traditional crimes. Corruption is not like that. Kleptocratic networks are diffused all over the world, beginning in Russia, Angola or dozens of other countries, spreading through the Far East and the Caribbean, ending in the Gulf, North America or Europe. Some of these countries have robust courts and honest politicians, and some of them do not, but the money flows seamlessly between them. An International Anti-Corruption Court will make no progress in countries ruled by the corrupt and is not needed in countries that are not. In fact, backers of the project implicitly make this case, in their arguments.

• “London and U.K. overseas territories — from the Caribbean to Gibraltar — are infamous money-laundering hotspots, and our government should adopt a leading role in gathering global support for the IACC. The U.K. must also do much more to regulate lawyers, bankers, real estate, accountants and other financial advisers aiding money launderers, enforce laws against foreign corruption and enhance transparency,” wrote a former government minister in a column in the FT. 

What’s to stop the U.K. or the U.S., or any other country which provides a haven for dirty money, tightening and implementing existing laws even without an IACC?

I worry that an IACC is in fact just another “announceable.” It sounds good in a press release but will achieve little more than delay and busywork for people who could be doing something more useful. What is needed is patient long-term investment in enforcing laws against corruption and financial crime to reduce the space available for kleptocratic networks to flourish; and for politicians to be willing to do that work, even if they do not get the credit for it.

WHAT I’VE BEEN READING

I have been on holiday for two weeks, swimming in lakes, stomping up mountains, sleeping in a tent and generally having a great time. I deliberately left my screens behind, except for my kindle, which I had packed with books to read. Sadly, however, one of my children decided he wanted to read it too and, loath to be seen to discourage him from reading, that left me with almost nothing to read for the entire holiday.

When I did get my hands on my Kindle, I read a couple of murder mysteries by P. D. James and I started The Omnivore’s Dilemma by Michael Pollan. Then my Kindle vanished once more, and I went back to cooking supper for the kids over the campfire, and hanging up their wet towels to dry. One day they will have kids of their own and I will have no sympathy. I’m looking forward to it.

The post Oligarchs take cover, in the West and in Russia appeared first on Coda Story.

But Apple has kept its services available for iPhone and Mac users inside the country, and the App Store — iPhone users’ window to much of what the internet has to offer — has become a place where Russians can find some pockets of information not tailored by the Kremlin. In April 2022, the embattled “Smart Vote” app, run by jailed opposition leader Alexei Navalny, even reappeared in the App Store after being blocked for months by both Apple and the Google Play store.

But last week, Apple’s commitment seemed to falter when a popular news and commentary podcast suddenly disappeared from the company’s podcast app for users across the globe. What happened? That’s the question on many people’s minds, and it’s also the name of the censored podcast from Meduza, one of Russia’s leading independent news sources, which now operates in exile like most of its counterparts.

“Apple deletes arguably Russia’s best podcast because Russian officials have asked for it,” said Anton Barbashin, a political analyst and the editor of Riddle Russia. “I’ll remind everyone that Meduza has the best reach into Russian audience,” he wrote on X. “It only makes perfect sense for Russian state to shut them down. But WTF, @Apple?”

I might ask WTF too, except that this kind of move, accompanied by zero explanation from the company, is all too familiar. For example, in Hong Kong, Apple has repeatedly bowed to political pressure to remove apps or pause services, with no acknowledgement or justification. 

Previous app removals have always been confined to one place: Hong Kong’s protest mapping app was only restricted in Hong Kong. But this time is different because Meduza’s podcast was blocked worldwide. Marielle Wijermars, a cybersecurity expert and an associate professor at Maastricht University in the Netherlands, thinks this is concerning. 

“The podcast may have violated Russia’s repressive laws, which Apple could argue warrants local removal to comply with, for example, a court decision,” she told me in an email. “But their contents are not illegal outside of Russia. A global removal thus applies Russian law beyond its jurisdiction and restricts speech in other countries where that speech is actually legal.”

She’s right. And sure enough, within a few days, and with no explanation, the podcast reappeared in the App Store for users everywhere. That’s great news for now.

But the flip-flop shows that the company is not impervious to pressures from the Kremlin. And the openings in Russia for accessing real information are fewer and farther between every time I look. It’s worth noting that when Big Tech took a big stand against Russia early on in the war, users there suffered the consequences — Meta’s services and Twitter were soon blocked by Russian authorities, along with thousands of news and information websites.

What are Russians to do then? “Just use a VPN,” my tech savvy readers might say. But that’s getting tougher too. Mediazona reported earlier this week that VPNs — especially those that cater to civil society groups and independent IT researchers — are struggling to stay online in the face of new efforts to block their services. The bottom line here is that the Kremlin is making it more difficult every day to access reliable information from inside Russia. It may seem like a faraway problem. But the stakes are high because what Russian citizens believe to be true affects not only their daily lives but their perception of the war in Ukraine, including the war crimes committed in their name. I’d say this is a problem for all of us.

GLOBAL NEWS

VPNs may also be on the chopping block in India, where the parliament just approved a new “privacy” law that could make it much harder for people to use privacy-preserving technologies, depending on how it’s implemented. The law sets new standards for the governance of data moving in and out of the country and will require companies to get express consent from people before collecting their data. Although this might sound similar to Europe’s General Data Protection Regulation, a critical difference is that the law doesn’t require the government to get the same consent, and it removes key due process mechanisms set up to limit government overreach. In this vein, the Internet Freedom Foundation says it could set the stage for “overbroad surveillance” by state authorities.

Kenyan authorities have put the kibosh on WorldCoin, citing privacy and finance concerns. WorldCoin, OpenAI CEO Sam Altman’s cryptocurrency project, has some very lofty ambitions — to bank the unbanked and to snuff out the seemingly eternal challenge of identity verification in the digital age. How do they do this? By capturing your iris data, of course . WorldCoin rolled out a beta version of its system, complete with an iris-scanning “orb” (a chrome ball with a scanner inside of it) in select cities in Africa and Asia in 2021, receiving mixed reviews and deep skepticism from privacy experts.

The beta phase is over now, and WorldCoin has made its official debut. It claims to have raked in more than two million sign-ups around the world, despite facing legal challenges in Germany, France and now Kenya. Last week, Kenya’s interior ministry suspended WorldCoin and launched an investigation into the product, including its security protocols, financials and data protection mechanisms, Reuters reported. Kenya isn’t exactly a beacon for data protection, but it is a leader when it comes to mobile banking and digital money — if Altman thinks he’s bringing something new to East Africans’ mobile phones, he failed to do his homework. Mobile money has been around in Kenya since 2007, for almost as long as mobile phones have. If you’ve got a phone and a working SIM card, you can use the homegrown M-PESA system to send and receive money through a state-backed exchange. The system later expanded to Tanzania, Mozambique and a handful of other countries in Africa.

This isn’t the only thing Altman has to worry about in Kenya. Content moderators working for Sama, a third-party contractor hired by OpenAI in Kenya to clean up its data set, have filed a petition calling on regulators to investigate both companies. Moderators told the Guardian that they’re made to review reams of text and images “depicting graphic scenes of violence, self-harm, murder, rape, necrophilia, child abuse, bestiality and incest” while receiving less than $4 per hour in wages. We’ve got more coming on this story in the fall.

Altman is also facing a lawsuit at home in the U.S., targeting both OpenAI and Microsoft. The companies are being sued over their data-hoovering practices to the tune of $3 million in California. The class action suit alleges that by scraping data from across the internet to create AI products, the companies have violated federal and state laws on privacy and computer fraud. In an instructive thread about the Open AI/Microsoft suit, Oxford professor and digital privacy expert Carissa Veliz wrote that “OpenAI has scraped off data from the internet, including personal data, without paying for it or asking for people’s consent. In short, they’ve stolen that data.”

The post Apple caves to the Kremlin, for a minute appeared first on Coda Story.

There is an interesting case in Wales (where I’m from), in which a drug smuggling gang used the crypto exchange Coinbase to launder their profits. This provides further evidence for the commonly expressed concern about the role that cryptocurrencies play in helping criminals to hide their profits.

• “In an attempt to hide the substantial amounts of money from law enforcement, friends and family were recruited to move crypto currency from account to account,” said Millie Davies of the Crown Prosecution Service.

Meanwhile, over in the United States, Senator Elizabeth Warren has called for stricter regulation on crypto exchanges to prevent fentanyl smugglers from using them to launder their illegal revenues. She quoted a report published last month by Elliptic and another one by Chainalysis, which concluded that tens of millions of dollars’ worth of fentanyl or precursor chemicals appear to have been paid for with cryptocurrencies — an impressive piece of investigation. Considering the damage that fentanyl is doing to the U.S., it’s unsurprising that Warren should be focusing on this challenge.

However, I’d like to keep things in perspective. Analyses of the U.S. drug market suggest it is worth $150 billion a year to the criminal gangs. Therefore — with the best will in the world — interrupting the laundering of a few million dollars’ worth of crypto is neither here nor there, in the grand scheme of things.

So what is important? As of last month, there were $2.34 trillion worth of U.S. banknotes in circulation — a sum that has nearly doubled over the past decade, just as it had, more or less, doubled in each of the previous two decades. At a time when the use of cash in everyday, legitimate transactions is in steep decline, there can only be one explanation for why demand for paper money is so healthy. It remains ever more central to the gray and black economies, particularly since more than 80% of it exists in the form of $100 bills. The inescapable conclusion is that the U.S. Federal Reserve is merrily printing out the money that allows criminals to circumvent other agencies in the U.S. government, thus indirectly helping to contribute to the 100,000 American deaths resulting from fentanyl overdoses last year alone.

The overprinting of banknotes is not solely a U.S. problem. In June, 1.56 trillion euros worth of banknotes were in circulation: This is slightly below the peak for 2022, but it’s still a spectacular volume of cash to be floating out there somewhere, particularly since so much of it is — you guessed it — in the form of 100 and 200 euro bills. But the problem is more pressing in the U.S. than elsewhere, thanks to the unique international role the dollar plays. 

Therefore, I would like to suggest, with the greatest respect, that Elizabeth Warren and her colleagues look a little closer in their own backyard if they wish to target criminals’ assets. Crypto may be shiny and new, but when it comes to money laundering, cash is king. If you want to make a serious dent in the profits of fentanyl smugglers, the Fed needs to be much less enthusiastic about how many $100 bills it prints. If the gangs had to move their proceeds in twenties, they would need to move five times as much paper around, which would make it five times easier for the authorities to see what they’re up to. Big bills are the problem and always have been.

GREAT PIECE ON CORRUPTION

There’s a Carl Hiaasen book in which a journalist is trying to work out which Florida politicians are corrupt by tabulating how they vote on real estate redevelopments, on the principle that, if they’re on the take, you’ll be able to see their criminal relationships by seeing which developers they help out. (If you don’t read Carl Hiaasen, by the way, then I recommend that you start, with “Bad Monkey.”)

Hiaasen is a wickedly funny writer and, in this case, the joke is that all the politicians are crooked, and they deliberately take turns voting for or against various deals, in various combinations, precisely to prevent anyone working out what they’re up to.

There is a similarly vertiginous feel to this remarkable article in the Economist’s 1843 magazine by Nicolas Pelham, recounting a colossal Iraqi bank heist.

• “Withdrawing $2.5bn in cash in less than a year would be a logistical challenge in any country, let alone one whose highest-value banknote – the 50,000 dinar bill – was equivalent to about $35. If all the stolen notes were stacked on top of each other, the pile would rise higher than Mount Kilimanjaro. Trucks had to be used to ferry the heist money about,” Pelham writes. 

Iraq has two broad geopolitically aligned power blocs, pro-Iran and pro-U.S., as well as multiple factions, all of whom jostle for control of various government entities and their financial flows. The article begins with attempts to understand which factions, and from which bloc, are responsible for this remarkable heist but gradually dissolves into a realization that perhaps everyone’s involved.

I have thought for a long time that we need a new vocabulary for how we talk about corruption, since the word has to cover everything from state capture to the tiniest of bribes. Imagine that doctors only had the word “cancer” to describe everything from leukemia to melanoma, and all points in between. That would severely impede their ability to precisely understand what was happening, and the imprecision of the word “corruption” has a similarly limiting effect. In fact, the word “corruption” may be worse, since it suggests that governments are inherently honest until they are corrupted by bad people: in the same way that fruit is corrupted by mold or data is corrupted by a hardware error.

In reality, honest governance is the exception rather than the rule. The kind of complex networks of family, friendship and obligation revealed in this article — which cut across institutional structures and state borders — are pretty standard in much of the world. If we don’t understand that, we’ll never understand how to push for more honesty in public life.

GREAT RESULT ON CORRUPTION

James Ibori was the governor of Nigeria’s Delta State from 1999 to 2007, and in that period he oversaw the looting of its oil wealth in spectacular quantities. Dubai extradited him to the U.K. in 2011, and he was sentenced to 13 years in prison for fraud and money laundering a year later. He served half of that sentence and returned home, and finally we have a confiscation order, after a four-week trial in London, of the sterling equivalent of $130 million.

• “The judge has determined that Ibori has at least 101,514,315.21 pounds [in] available assets and has made a Confiscation Order in that amount, noting that a failure to pay that order in full will result in him being subject to an additional eight years in prison.”

In a separate but related case, Ibori’s U.K.-based lawyer (who was also convicted of money laundering in 2010) was ordered to pay 28,191,787.15 pounds. Here’s an irrelevant but interesting question: Why are the court orders so curiously specific? If anyone knows why they are given to the penny, rather than rounded up at least to the nearest pound, could you let me know?

Ibori continues to argue that he did nothing wrong.

• “The next steps will be to take my fight for justice to the highest courts in the UK,” he said in a statement.

I have two points to make here. The first is to give credit to the U.K., which — quite rightly — gets severely criticized for its feeble efforts to keep dirty money out of the economy. The investigators and prosecutors in the Ibori investigation did a good job, considering these are complex and laborious cases to lay out in court. The second point is to note the mismatch between the baddies and the goodies. Corruption is quick and easy, requiring just connections, chutzpah and perhaps a truck to carry the cash in. But honesty takes time, money and effort, even in relatively well-resourced jurisdictions like Great Britain or the United States.

Whenever I feel like I’m forgetting this, I look up Pavlo Lazarenko to see what he’s up to. Lazarenko was the prime minister of Ukraine from 1996 to 1997, fled to the United States in 1999, was arrested, prosecuted and jailed for extortion, money laundering and wire fraud, was released in 2012 and indicted in Ukraine shortly afterwards. But, after decades of legal effort, the United States has still not been able to confiscate his assets. He stole perhaps $200 million in a short-lived but extravagant spree in the mid-1990s and — more than two decades later — lawyers are still arguing over how best to confiscate the funds. (There was a court ruling on one tiny branch of this monstrous legal tree as recently as this June, and others will surely follow.) The case has now gone on so long that he and his lawyer have had several children together.

This is the case I always think about when I hear politicians speak confidently about confiscating Russian oligarchs’ frozen property and sending it to Ukraine. Lazarenko was, in wealth terms, a minnow compared to some of his Russian counterparts, and he was stupid enough to fly to one of the only countries likely to prosecute him for his corruption. Yet his wealth has still not been returned to the people it was stolen from.

This is why it is so important to build strong institutions, robust regulations and an honest culture so that money doesn’t get stolen in the first place. And this is also why we shouldn’t be satisfied with governments sanctioning oligarchs and freezing their wealth. If a fortune has been stolen, that means damage has already been done. It would be far better to prevent the damage from being inflicted in the first place.

There is a lot of detail about what precisely that damage looks like in this excellent report from the National Endowment for Democracy on the role of Russian and Chinese kleptocratic networks in Central Africa. It describes how Russia’s Wagner Group undermines the rule of law in the countries where it operates in order to make theft easier and prop up its political allies.

• “Systemic change will require rolling back long-standing practices in democratic societies such as golden visas, anonymous shell companies, flags of convenience, shadow banks, and jurisdictions that provide a safe haven for kleptocrats – and it will likely mean disrupting relationships with illiberal allies,” the report concludes.

British authorities are saying that Ibori’s stolen wealth will be returned to Nigeria and “reinvested into public services,” which is, of course, very welcome. But I doubt anyone (except his lawyers) will see a penny of it for many years. The same is almost certainly true of the Russian oligarchs’ assets. 

WHAT I’VE BEEN THINKING ABOUT

There’s something about sports that gets people spending money and suspending judgment. I can remember very clearly the surge in goodwill toward Roman Abramovich among ordinary Muscovites when he bought Chelsea Football Club, and it was amply returned by the Brits when his wealth transformed the team into a colossus. Since then, the amount of money in sports has only grown, and the oligarchic competition has only gotten more intense, leading inevitably to an interesting geopolitical edge to the competition for top players.

Lionel Messi went to Miami, where his stardust is benefiting the whole U.S. league, no doubt disappointing the Saudis, who bought Cristiano Ronaldo. Ronaldo took a swipe at his old rival by saying that the Saudi league is better than its U.S. counterpart, but I think the real test will be where Kylian Mbappé ends up. He’s still in his prime and will want to win more trophies before he cashes in completely. Money has been upending football for decades, allowing European clubs to eclipse the South Americans, then allowing English clubs to eclipse everyone else, thus making the Premier League into a true international tournament in which oligarchs can square off against each other like one of those mash-up movies (“Alien vs. Predator,” “Godzilla vs. Kong,” hedge fund boss vs. petrobaron, private equity vs. sovereign wealth fund).

But if money is in charge, why should it stop there? Can Saudi money capsize football as it did golf? You’d be a fool to bet against it. Personally, I find this stuff far more interesting than watching 22 men chasing a ball. But then I prefer rugby anyway.

The post You want to tackle the fentanyl crisis? Print smaller bills appeared first on Coda Story.

Another social media research organization is being sued this week, this time by the company formerly known as Twitter. On Monday, X filed a lawsuit against the Center for Countering Digital Hate, a nonprofit research and advocacy organization that tracks violent and hateful speech on social media. X claims that the research organization violated its terms of use when it scraped data from the platform, among other allegations. 

Much of the filing focuses on the impact that the Center for Countering Digital Hate’s research has had on advertising and, by extension, on X’s bottom line. The group regularly uses its findings to pressure big brands to stop buying ads on X because showing ads next to tweets filled with racist speech and political disinformation is generally regarded as bad for business. This increasingly popular tactic among tech-focused civil rights advocacy groups in the U.S. has proven powerful and may indeed be one reason that X’s ad revenues have plummeted since Musk took over.

The court filing and the company’s all-but-incomprehensible blogpost about the lawsuit say plenty about how this strategy threatens X’s business model. But the company also argues, as Musk so often does, that X is simply trying to protect people’s rights to free speech and that the researchers want to undermine it. Nevermind that hate speech and threats of violence are routinely deployed as silencing tactics by trolls of many stripes, including Musk himself. The filings also make many mentions of the organization’s focus on trying to reduce online disinformation about topics like Covid vaccines, reproductive healthcare and climate change. X argues that this aspect of the group’s work is driven by ideology, when in reality, it is driven by hard facts. Covid vaccines work, reproductive healthcare is a human right, and climate change is real.

The case against the Center for Countering Digital Hate is all too similar to the spate of legal threats recently brought against members of the Election Integrity Partnership, a research coalition assembled around the 2020 election in the U.S. that included the Stanford Internet Observatory, the German Marshall Fund and the Atlantic Council’s Digital Forensic Research Lab, among others. These research groups were focused on tracking election-related disinformation — including state-run accounts promoting false information about who won the 2020 election — and alerting social media companies. When Twitter was still Twitter and Elon Musk was just a foul-mouthed super user of the site, the company actually did try to reduce demonstrably false information about voting rights and election outcomes. Right-wing politicians and magnates like Musk have long leaned on the argument that this infringes on people’s rights to free speech. But even now, when Musk is at the helm of this rapidly disintegrating but still very influential platform, he can’t seem to get enough. So he’s taking this comparatively tiny research group to court.

Imran Ahmed, who leads the Center for Countering Digital Hate, told the New York Times that Musk’s actions are “a brazen attempt to silence honest criticism and independent research.” They are also undoubtedly taking up the Center’s time and resources that would otherwise be spent doing more research in the public interest. 

GLOBAL NEWS

Senegalese authorities ordered a nationwide mobile internet shutdown on Monday after officials apprehended and jailed opposition leader Ousmane Sonko and the country’s Interior Ministry moved to dissolve the PASTEF party, which Sonko leads. This latest chapter in the long-running conflict between Sonko and Senegalese President Macky Sall has seen large pro-PASTEF rallies and heavy-handed state responses, including internet restrictions. In this case, officials indicated that the shutdown was ordered “due to the dissemination of hateful and subversive messages in a context of disturbance of public order.” A similar shutdown was imposed last June and turned into a curfew-style system, with people allowed to use the internet during the day but kicked offline in the evening hours.

Don’t like the police? Don’t say so in Jordan, where the parliament is mulling over a draft cybercrime law that covers everything from “content that provokes strife” to regulations reining in Big Tech. The law would make it a crime to post any material online that “undermines national unity, incites or justifies violence or hatred, or disrespects religions,” and it includes special provisions criminalizing speech related to law enforcement officials.

The law would require social media companies with more than 100,000 subscribers (read: Meta) in Jordan to establish offices in the country. Embarking on the well-trodden path of heavyweight countries like India, some — but not all — Jordanian MPs appear eager to require more cooperation between Big Tech and the government. These policies typically force companies into much stricter compliance with local law, lest they put their business or even their own employees at risk. And it can spell trouble for people who use social media to hold the government to account or document police abuse. Since Jordan’s draft law also makes it illegal to publish any material about law enforcement officials “that may offend or harm” the institution, well, we can guess what might happen next. Alongside the Jordan Open Source Association and SMEX, global groups like Access Now, Article 19 and the Electronic Frontier Foundation are publicly opposing the law.

There’s new evidence that the U.S. government has been using spyware built by Israel’s NSO Group, despite the fact that the company was officially blacklisted by the White House in March. Documents reviewed by the New York Times in April showed that U.S. government agents, operating behind a front company called Riva Networks, were using a geolocation tool built by the Israeli surveillance tech giant that would allow agents to track anyone through their mobile device, without their knowledge. White House staff, who said they knew nothing of it before the Times’ story ran, put their best guys on it — they asked the FBI to investigate. But this week, it came to light that the NSO contract was held by….the FBI.

The revelations shouldn’t be surprising — NSO first worked its way into U.S. government contracts in 2019. But they sure do cast a shadow over Biden’s ban on commercial spyware.

The post Musk joins the right-wing legal crusade against tech researchers appeared first on Coda Story.

This is bad for people, but it could also sound wonky, banal or even “small bore” to tech experts. Yet it is precisely the kind of existential threat that we should worry about when we look at the consequences of bringing artificial intelligence into our lives.

You might remember this spring, when the biggest and wealthiest names in the tech world gave us some pretty grave warnings about the future of AI. After a flurry of opinion pieces and full-length speeches, they found a way to boil it all down to a simple “should” statement: 

“Mitigating the risk of extinction from AI should be a global priority alongside other societal-scale risks such as pandemics and nuclear war.”

This sentence and its most prominent signatories (Sam Altman, Bill Gates and Geoffrey Hinton among them) swiftly captured the headlines and our social media feeds. But have no fear, the statement’s authors said. We will work with governments to ensure that AI regulations can prevent all this from happening. We will protect you from the worst possible consequences of the technology that we are building and profiting from. Oh really?

OpenAI CEO Sam Altman then jetted off on a global charm tour, on which he seems to have won the trust of heads of state and regulators from Japan to the UAE to Europe. A week after he visited the EU, the highly anticipated AI Act had been watered down to suit his company’s best interests. Mission accomplished.

Before the tech bros began this particular round of spreading doom and gloom about blockbuster-worthy, humanity-destroying AI, journalists at ProPublica had published an investigation into a much more clear and present threat: Cigna’s PXDX algorithm, the very subject of the aforementioned lawsuit. 

In its official response to ProPublica’s findings, Cigna had noted that the algorithm’s reviews of patients’ claims “occur after the service has been provided to the patient and do not result in any denials of care.” 

But hang on a second. This is the U.S., where medical bills can bankrupt people and leave them terrified of seeking out care, even when they desperately need it. I hear about this all the time from my husband, who is a physician and routinely treats incredibly sick patients whose conditions have gone untreated for years, even decades, often due to their being uninsured or underinsured. 

This is not the robot apocalypse or nuclear annihilation that the Big Tech bros are pontificating about. This is a slow-moving-but-very-real public health disaster that algorithms are already inflicting on humanity. 

Flashy tools like ChatGPT and LensaAI may get the lion’s share of headlines, but there is big money to be made from much less interesting stuff that serves the banal needs of companies of all kinds. If you read about what tech investors are focused on right now, you will quickly discover that the use of AI in areas like customer service is expected to become a huge moneymaker in the years to come. Again, forget the forecasted human extinction by robots that take over the world. Tech tools that help “streamline” processes for big companies and state agencies are the banal sort of evil that we’re actually up against.

Part of the illusion that seems to drive statements that prophesy human extinction is that technology will start acting alone. But right now, and for the foreseeable future, technology is the result of a multitude of choices made by real people. Right now, tech does not act alone.

I don’t know where we’d be without this kind of journalism or the AI researchers who have been studying these issues for years now. I’ve plugged them before, and now I’ll do it again — if you’re looking for experts on this stuff, start with this list.

And now I’ll plug a new story of ours. Today, we’re publishing a deep dive that shows how a technical tool, even when it’s built by people with really good intentions, can contribute to bad outcomes. Caitlin Thompson has spent months getting to know current and former staff at New Mexico’s child welfare agency and speaking with them about a tool that the agency has been using since 2020. The tool’s intention? To help caseworkers streamline decisions about whether a child should be removed from their home, in cases where allegations of abuse or neglect have arisen. This is a far cry from the ProPublica story, in which Cigna seems to have quite deliberately chosen to deny people’s claims in order to cut costs. This is a story about a state agency trying to improve outcomes for kids while grappling with chronic staffing shortages, and it shows how the adoption of one tool — well-intentioned though it was — has tipped the scales in some cases, with grave effects for the kids involved. Give it a read and let us know what you think.

GLOBAL NEWS

Google and Meta are facing new legal challenges over violent speech on their platforms. The families of nine Black people who were killed in a supermarket in Buffalo, New York in 2022 have filed suit against the two companies, arguing that their technologies helped shape the ideas and actions of Payton Gendron, the self-described white supremacist who murdered their loved ones. The U.S. Supreme Court has already heard and decided to punt on two cases with very similar characteristics, reasoning that the companies are shielded from liability for speech posted by their users under Section 230 of the Communications Decency Act. So the new filings may not have legs. But they do reflect an increasingly widespread feeling that these platforms are changing the way people think and act and that, sometimes, this can be deadly.

The Saudi regime is using Snapchat to promote its political agenda — and to intimidate its critics. This should come as no surprise: An estimated 90% of Saudis in their teens and 20s use the app, so it has become a central platform for Saudi Crown Prince Mohammed “MBS” bin Salman to burnish his image and talk up his economic initiatives. But people who have criticized the regime on Snapchat are paying a high price. Earlier this month, the Guardian reported allegations that the influencer Mansour al-Raqiba was sentenced to 27 years in prison after he criticized MBS’ “Vision 2030” economic plan. Snapchat didn’t offer much in the way of a response, but Gulf-based media have reported​ on the company’s “special collaboration” with the Saudi culture ministry. It’s also worth noting that Saudi Prince Al Waleed bin Talal — who is Twitter, er, X’s, biggest shareholder after Elon Musk — is a major investor in the company.

WHAT WE’RE READING

• Writing for WIRED, Hossein Derakshan, the blogger who was famously imprisoned in Iran from 2009 until 2015, reflects on his time in solitary confinement and what it taught him about the effects of technology on humanity.

• Justin Hendrix of Tech Policy Press has written a new essay on the “cage match” between Elon Musk and Mark Zuckerberg, the “age of Silicon Valley bullshit” and the overall grim future of Big Tech in the U.S. Read both pieces, and then take a walk outside.

The post The AI apocalypse might begin with a cost-cutting healthcare algorithm appeared first on Coda Story.

A friend of my cousin has a brick-sized bundle of pre-revolutionary Russian rubles, which he gets out and shows off occasionally. The story goes that the friend’s ancestor made a sizable business deal with a Russian aristocrat during World War I and got paid in cash. But then, well, one thing led to another, the monarchy fell, the aristocracy was scattered, the Bolsheviks came to power, and there were some significant alterations to Russia’s constitutional arrangements and economic policy. And those rubles have sat in the safe ever since, not worth the paper they were printed on.

Occasionally, visitors ask if they could have a banknote as a souvenir, but he has preferred to keep them together, perhaps because a lump of them together serves as a reminder to be careful who you do business with. However, some years ago, he did separate out a single 200-ruble bill, which he framed and hung in the downstairs toilet, with these words printed on the glass: “In the event of the restoration of the Russian monarchy, break glass.”

Now, in 2023, the Kremlin has decided to expropriate the assets of Carlsberg and Danone and to distribute them to people who I would call loyalists — except the concept of “loyalty” shouldn’t really require being bribed with spectacularly cash-generating assets such as these. A nephew of Ramzan Kadyrov is now really big in dairy products, and an associate of a close Putin ally is back in charge of Baltika breweries, which he helped to run in the past.

This feels like a full circle for me. I used to drink Baltika beer when I first moved to Saint Petersburg in 1999: It only cost 12 rubles a bottle, unlike imported brews or the local super-premium beer, and although it didn’t taste of much, you could at least rely on it not to leave you feeling like death in the morning or, in a worst-case scenario, turn you blind. In 2000, Carlsberg — presumably attracted by that same combination of reasonable pricing and stolid reliability — bought a stake in the company, which it eventually took over outright. It was not a glamorous business deal, but it was the kind of investment that typified the predictable business climate Vladimir Putin sought to create and that underpinned the prosperity of Putin’s first decade in charge.

But then came February 2022. Carlsberg pledged to divest itself of its Russian assets after Putin’s full-scale invasion of Ukraine and signed a deal to sell Baltika in June 2023, with Danone having done the same in October 2022. These sales would have come at a significant discount to the assets’ true price but look at it from the oligarchs’ point of view: Why get companies for cheap when you can have them for free?

• “It shows that Russia is prepared to take countermeasures against Western companies in order to curry favour with the new elites. The redistribution of wealth is reminiscent of the 1990s, when the oligarchs emerged,” said Maria Shagina, a senior research fellow for economic sanctions at the International Institute for Strategic Studies (IISS).

The Kremlin had already made it exceptionally hard for companies from unfriendly countries to realize anything like the value of their investments in Russia and, even if they could, they had to pay a hefty exit tax. There is a technocratic logic to that plan, particularly at a time when so many Russian assets are frozen in the West, but you can see why the oligarchs don’t like it. Kremlin insiders want cash flow. And with the economy squeezed by sanctions while an increasingly large portion of state spending goes to the military, their grift has lost much of its profit. The few surviving consumer firms are going to look increasingly attractive when it comes to squabbling over what’s left of the Russian economy.

There is an argument — made here by Ekaterina Kurbangaleeva — that this policy of expropriation could help Putin restore his compact with Russia’s middle classes, who could gain ownership stakes and management roles in these formerly Western-owned companies. That seems to me absurdly optimistic and suggestive of a Kremlin focused on the next year, rather than one that’s mainly worrying about how to get through the next month.

The Prigozhin revolt is indicative of an elite that badly wants its tummy tickled, and the oligarchs have always been the constituency Putin worries about the most. Faced with the option of plumping out Russia’s squeezed middle or just chucking money at anyone with a private army, there’s only going to be one winner.

Incidentally, if any oligarchs out there are looking for companies to expropriate, Yale Professor Jeff Sonnenfeld has compiled a helpful list of everyone who’s said they’ll leave Russia but not quite gotten around to it yet, including Heineken, Unilever, Philip Morris International and Oreo maker Mondelez. Considering that this war has been going on for more than 500 days and that any taxes paid in Russia support the war effort, I’m not sure I’d have much sympathy for any of these firms if they lost everything.

In response to their particular travails, Carlsberg has said it will take “all necessary actions,” while Danone will take “all necessary measures,” to which my response is…Good luck with that. In the meantime, they could separate out one title deed from the bundle of ownership documents for their lost assets and hang it, in a glass frame, in the executives’ toilets to read: “In the event of the restoration of sanity in Russia, break glass.”

BUT WHAT ABOUT?

But what about the oligarchs’ assets in the West, I hear you ask. Surely, this aggressive and possibly illegal act of theft means we should do the same to Russians’ mansions, yachts, financial assets and so on? Well, quite a lot of wealthy Russians would argue that Western governments have already gone beyond the law in their sanctions policies, including Russian-born businessman Eugene Shvidler, who is currently challenging U.K. sanctions in the London High Court.

Shvidler, who has British and U.S. citizenship, appeared by video link to say that the sanctions had shattered his reputation, forced two of his children to leave their English schools and made it impossible for him to conduct his business. The U.K. government defended the sanctions, which were imposed because of Shvidler’s close relationship with Roman Abramovich.

• They will “incentivise him to put pressure on Mr Abramovich to encourage President Putin to cease or limit” the war, the government’s lawyer said, while sending a message that “there are negative consequences to having implicitly legitimised the government of Russia’s actions.”

The result will be closely watched by other sanctioned businessmen and, if Shvidler is successful, I suspect a flood of legal appeals will follow.

Anyone who has read my newsletters in the past will know I have my reservations about sanctions. In my opinion, they are a useful adjunct to a concerted diplomatic and law enforcement response to a challenge, but they shouldn’t be the whole response. Besides, if we engage in permanent sanctioning, we are undermining the basis of the Western “rules-based” order, which is supposed to be what makes us admirable in the first place.

• “Sanctions have become the all-purpose tool of statecraft, meant to convey opposition to everything from military invasions to human rights abuses to nuclear proliferation to corruption, irrespective of whether they help or undermine long-term U.S. interests. They are a means of virtue signalling that allow politicians to show that they are doing something when faced with a given issue,” as this forceful piece by Christopher Sabatini puts it. It’s definitely worth a read.

I sincerely hope all Western governments are thinking about how to move on from sanctions, though I worry that they aren’t. The U.K. and the U.S. have just launched a “strategic sanctions dialogue,” which suggests that they intend to keep relying on this tool, rather than investing in the laborious but important work they should be doing instead.

So, on that note, I was glad to see that Britain has lifted its sanctions on Oleg Tinkov after he spoke out forcefully against Russia’s war and lost many of his assets in the country as a result. If oligarchs are to be sanctioned for doing the wrong thing, there should at least be the theoretical possibility of them being de-sanctioned if they do the right thing. I hope this gives other tycoons courage to oppose the war. We need to lure Russian oligarchs away from Putin, and that means offering them an exit.

Incidentally, Tinkov made that Russian super-premium beer I referred to earlier. “Tinkoff,” spelled in the French manner for added sophistication, began its life at a bougie microbrewery in Saint Petersburg, which opened in 1998, though I could rarely afford to visit it at the time. Its commercials (which are definitely NSFW or for watching in any vaguely sensitive environment) are a pretty stark example of how sophisticated marketing wasn’t in Russia in those days: Superyachts, sports cars, naked women, beer!

UNCLE SAM STOMPS ABOUT

The U.S. Federal Reserve has fined Deutsche Bank $186 million for “unsafe and unsound practices,” which date back to the German lender’s role as the primary correspondent bank for Danske Bank (on whose behalf it cleared $267 billion). Since the Danske Bank scandal remains the biggest money laundering scheme ever uncovered, it’s not surprising that Deutsche’s role as a major enabler should have attracted attention.

What’s interesting here is that the Federal Reserve is intervening in what is, by any measure (apart from the use of U.S. currency), a European affair: A German bank was clearing money for a Danish bank’s Estonian branch, originating in accounts whose ownership was obscured behind British shell companies. That’s not to say that the Europeans are doing nothing. Germany’s BaFin made a stern warning last year, on top of previous stern warnings made in 2019 and 2018, and perhaps Deutsche Bank will listen to them at some point. Denmark opened cases against a handful of Danske Bank individuals, although it subsequently dropped the charges and fined the bank itself 470 million euros (about $520 million). But that was only after the Americans fined it four times as much. The point is, when the Americans do something, they really do something, and that something tends to stay done.

This is why the Foreign Corrupt Practices Act (this is a good resource on all FCPA matters) remains a cornerstone of global efforts to stop corruption and why I like the sound of the recently proposed Foreign Extortion Prevention Act, which would make it a crime for a foreign official to demand a bribe from an American. At present, U.S. law only criminalizes the paying of bribes (unlike similar legislation in other countries), and this would give it far greater heft.

• “(It) would protect Americans from bribe demands, create a level economic playing field for American companies operating abroad, and incentivize foreign governments to clean up corruption in their own backyards,” notes this coalition of anti-corruption organizations that is pushing the idea.

Unleashing the U.S. Department of Justice on kleptocrats is a good idea, and I hope it gains momentum.

WHAT I’M WATCHING

Most of my time is taken up with researching money laundering and the struggle against it for my new book. Since a lot of this dates back to the peculiarities of Florida in the 1980s, I have been watching “Miami Vice” (for research purposes only, you understand). Huge hair, an alligator named Elvis, baddies with attitudes, designer stubble, fast cars…This show’s got it all, and there are still many episodes for me to watch.

In a more serious moment, I really appreciated the sober approach to corruption taken by the first installment of the Carnegie Endowment’s Behind Closed Doors podcast, and I am looking forward to the remaining two episodes.

The post How the Kremlin rewards loyalty with beer and dairy appeared first on Coda Story.

But hang on – let’s pause for a quick calendar check. Threads debuted on July 5. Sure, it was just after a holiday weekend in the U.S. But it also came on the heels of something much more consequential for the company. On July 4, the European Court of Justice issued a historic ruling that undermines Meta’s legal justification for serving targeted ads in the EU and empowers competition regulators to go after the company on data protection grounds. Legalese aside, this ruling could effectively blow up Meta’s business model in the region, and has put the company’s operations there into serious jeopardy. I recommend Jason Kint’s breakdown if you want the legal nitty gritty. But the bottom line is that Meta is in big trouble for collecting tons of user data without sufficient consent and then mixing and matching it across its services. This is the engine driving the creepily precise ad targeting jiu-jitsu for which Meta is so well known and upon which its business model is based. 

If Zuck is emoji-toasting Threads’ success with one hand, chances are good that with his other hand he is feverishly texting the heaviest of his legal and political heavyweight pals like never before.

The effects of the ruling are already playing out. Norway’s data protection authority stepped up last Friday and temporarily banned Meta from engaging in “highly opaque and intrusive monitoring and profiling operations” (AKA serving targeted ads). Beginning on August 4, Facebook and Instagram will be allowed to serve ads to users, but those ads may only draw on information that appears in the “about” section of users’ public profiles.

If Meta fails to comply with Norway’s ban, it will be stuck with a daily fine just shy of $100,000. While that alone won’t make much of a dent in Meta’s bottom line, it’s part of a bigger picture that almost certainly will. Other EU states are bound to follow suit. Plus there’s the 390 million euro fine that Meta is already facing in Ireland, stemming from the strategic litigation efforts of Austrian privacy lawyer Max Schrems. Mix this all together with the obvious anxiety that it will cause among investors, and you have yourself a serious problem.

If you think Zuckerberg isn’t nervous about it, look at Threads just one more time. Unless you’re in Europe, in which case, you can’t, because Threads hasn’t launched there yet. Instagram head Adam Mosseri says this has to do with the company’s efforts to comply with the EU’s Digital Services Act. But the timing is conspicuous. They may actually be running scared.

Researchers in Switzerland recently rolled out an AI model that they say can detect homosexuality by scanning a person’s brain. AI ethics and LGBTQ rights experts say the model is dangerous. Coda’s Isobel Cockerell has the story.

GLOBAL NEWS

The launch of Threads is also a reminder of the risks that Meta continues to take in monetizing public conversations. Computer and social science researchers have shown again and again that the data collection practices that lie at the heart of what I will now go ahead and call Meta’s surveillance advertising business model are a big part of what makes this a dangerous proposition. The model’s success depends on attention – views, clicks, likes, shares and comments – and any quasi-public space that does this is bound to run into trouble when it comes to political speech, elections, conflict zones, and any other situation where harmful speech or disinformation can go viral and really hurt people. Hate speech in a vacuum is hateful and might hurt the handful of people who see it. But hate speech amplified by an algorithm can reach and inspire millions. We need only look at Myanmar, Ethiopia, or most recently Sudan to understand that it can be deadly.

Meta seems hopeful that we’ll somehow forget this and embrace Threads as a “positive and creative space to express your ideas.” Mosseri has actually said he hopes to keep “politics and hard news” off of Threads. In an intro post, he wrote: “my take is, from a platform’s perspective, any incremental engagement or revenue they might drive is not at all worth the scrutiny, negativity (let’s be honest), or integrity risks that come along with them.” It must be a real drag having to answer to the public and investors about the fact that Meta’s platforms regularly amplify threats of violence and hate speech that has led to real-life harm. The New Republic’s Molly Taft mock paraphrased Mosseri with this zinger of a tweet: “head of instagram says: pls don’t be a downer on threads, we don’t want to have to spend money on fact checking, also no one bring up Myanmar thx.” Buuurn.

And Meta is feeling the heat elsewhere too. Uganda’s parliament slapped a 5% levy on Meta alongside several other Big Techs last week, as part of a new tax law that will apply to “non-resident providers of digital services” like Meta, Twitter, Amazon, Netflix and Uber. The law’s proponents say it will boost public revenue and that it’s overdue from foreign companies that turn big profits in the country. State Finance Minister Henry Musasizi put it this way: “We are looking at the money obtained by the supplier of these services. The money for Uber goes to California; the man makes money but doesn’t pay taxes.” Fair enough. 

And Uganda is not alone in this pursuit – Nigeria and Kenya have both introduced similar tax laws targeting digital services in recent years. But can policymakers find a way to keep the tax from being passed on the consumers? Social media and taxation haven’t mixed well in the past. Uganda’s 2018 “social media tax,” that President Museveni (in power then, in power now) defended as a way to curb “gossip” on social media, forced Ugandans to cough up a daily levy before using social media mobile apps. The law sparked widespread protests, and in addition to violating net neutrality principles, it left poor Ugandans facing a 10% increase in the cost of getting online. A year after it passed, internet use among Ugandans had fallen by 30%.

Lithuania is trying to bring Big Tech to heel too, on the issue of political bots. This week Coda reporter Amanda Coakley and I teamed up on a story about proposed amendments that would criminalize “disinformation, war propaganda, [content] inciting war or calling for the violation of the sovereignty of the Republic of Lithuania by force” from “automatically controlled” accounts. Bigger countries have seen some success using a similar approach, but I wonder if Meta and the rest will be willing to comply in Lithuania, home to just 2.8 million people.

WHAT WE’RE READING

• While European governments are doing plenty of talking to U.S. tech giants, U.S. government officials are currently unsure if they can talk to those same giants themselves. This is because a federal judge in Louisiana recently ruled that state attempts to coerce or otherwise influence companies’ actions is a violation of the First Amendment. Ruh roh! I highly recommend this breakdown of the decision by CJR’s Matthew Ingram.

• Could AI be used to automatically interpret and enforce the law? I’m sorry to say that two very smart people who I know and trust think that it could. Bruce Schneier and Jon Penney set the dystopian scene and then back it up with proper intel and research in this zinger for Slate’s Future Tense vertical.

The post Meta’s business model is crumbling in Europe appeared first on Coda Story.

For the last two decades, Ukraine’s relationship with NATO has been fraught. Back in 2002, Leonid Kuchma, Ukraine’s president at the time, gate-crashed the NATO summit. He did this despite being disinvited in light of the allegations that he had overseen the decapitation of journalist Giorgiy Gongadze (may he rest in peace) and smuggled weapons to Iraq. Kuchma’s surprise appearance forced the presidents’ places to be alphabetically arranged in French — rather than the more-standard English — to avoid the awkward sight of him sitting next to the leaders of the United Kingdom and United States. In 2008, Ukrainian President Viktor Yushchenko attended another NATO summit, still riven by post-Iraq War splits, winning a promise that his country could join the alliance but with no suggestions as to when.

Thanks to these humiliating-for-Ukraine episodes, I was surprised when — at an advisory council meeting for the Anti-Corruption Action Center, Ukraine’s most influential NGO, back in 2019 — the founders said they would be pushing for Ukrainian membership in NATO as part of their mission to advance political integrity in Ukraine. I am a member of the council, and I wasn’t alone in worrying that the policy might distract from the center’s core mission and cost it the support of NATO’s many skeptics.

Back then, it was still possible to see Ukraine’s two wars — the domestic one against corruption and the external one against Russia — as separate. Since February 2022, however, all such arguments are meaningless. Tackling bribe-taking is as much a part of winning the war as mine clearance, and defeating Russia is as crucial to a healthy political culture as sacking crooked judges.

And this has made me realize how very prescient Daria Kaleniuk, Vitaly Shabunin and their AntAC colleagues were in arguing for NATO membership at that meeting four years ago. You cannot tackle Ukrainian corruption without confronting the Western enablers who have helped oligarchs and politicians loot Ukraine and stash the proceeds in Britain, France, California and elsewhere. It is simply too easy to use Cypriot shell companies to manipulate state contracts and receive bribes and too difficult for under-resourced investigators in Kyiv to find the evidence to prosecute the guilty. The only way to crack down on corruption is to stop its Western enablers, and the only way to stop its Western enablers is to persuade Western politicians to do so. Which has proved all but impossible to date.

So what’s NATO got to do with it?

If Ukraine were to join NATO, its security would be aligned with that of the NATO countries where kleptocratic wealth tends to end up, like the U.K., the U.S., France and Spain, as well as the NATO countries through which kleptocratic wealth passes, like Turkey, Germany, the Baltic states and the Netherlands. These states would therefore gain a security imperative to prevent Russia-aligned oligarchs from destroying Ukraine’s political stability, which would give tackling corruption far more urgency than it has ever had before. It shouldn’t, but it would.

The intriguing aspect of the recent comments by British Defense Secretary Ben Wallace and U.S. National Security Advisor Jake Sullivan — suggesting that Ukrainians should show more “gratitude” to their Western helpers — is that these apparently throwaway remarks perfectly encapsulated the West’s failure to understand our own role in immiserating Ukraine. Even these two men, who know more than almost anyone about Ukraine’s security needs, failed to appreciate the crucial role the West has played in the looting of Ukraine, which has in turn undermined its security, since 1991. If everyone understood the true situation, they’d know that the question of Ukrainian gratitude shouldn’t come into it: It is us who owe Ukraine.

I understand that NATO membership is not an antidote to domestic corruption (see the horrors of this year’s Turkish earthquake) or to authoritarian governments (see grim political developments in Hungary and Poland), but it is notable that there are no properties belonging to oligarchs from NATO member states on our London kleptocracy tours. NATO membership seems to prevent citizens from one member state from stoking kleptocracy in another too enthusiastically.

And that is something that, for its long-term prosperity, Ukraine needs almost as much as it needs 155mm artillery shells for its short-term victory.

Ukraine’s NATO membership is not just crucial to helping protect its territorial integrity and binding it to the Western family of nations but also to preventing the kind of grand corruption that kept it tied to Russia for so long. It’s up to everyone who cares about tackling oligarchy, and tackling the causes of oligarchy, to make the case for Ukraine to join NATO as soon as possible. And it’s in our own interests too: Only a non-corrupt Ukraine can truly defend Europe’s eastern border.

• “An army plagued with corruption, such as soldiers accepting bribes, governments misusing military expenditure, and officials making decisions influenced by personal gain, will not be able to win a war — and it will not be able to deliver on deterrence. It will be perceived as an enemy that can be easily defeated,” Transparency International’s Ara Marcen Naval wrote.

It’s not easy, but the first step to defeating corruption — just like the first step to winning a war — is for politicians to commit to it.

CORPORATE TRANSPARENCY

However, if you want to see an example of the gap that exists between a country’s politicians saying they want to get serious about kleptocracy and their country actually getting serious, have a look at this document, prepared for a hearing of the U.S. House of Representatives’ Subcommittee on National Security, Illicit Finance, and International Financial Institutions. Submitted by Jim Richards, a spectacularly knowledgeable anti-money laundering professional, as evidence for the members of Congress who are looking into the Corporate Transparency Act, it voyages deep into the weird, fractal world of implementing this landmark piece of legislation, first adopted in 2020.

The CTA was initially backed by both parties, the Trump and Biden White Houses, the U.S. Chamber of Commerce and many many others as a crucial step toward insulating the economy from dirty money. Nevertheless, Richards predicts that the implementation of the law will be delayed, beyond its proposed start date of January 2024, because of the difficulties in getting it through the machinery of state.

• “With less than six months to go before the promised launch date of FinCEN’s Beneficial Ownership Information (BOI) database, FinCEN has yet to publish a final rule on how that database will be accessed, it has yet to provide guidance to the fifty states’ secretaries of state on whether and how they will support the efforts of their 35 million state-created entities that will need to submit BOI, it has yet to publish a proposed rule — let alone a final rule — on how financial institutions will use this new BOI, and it hasn’t finished building and testing the actual database. Other than that, everything is on schedule and ready to go,” Richards notes with irony so heavy you’d need a forklift to pick it up.

There is much to criticize here but, as Richard says, the worst thing is FinCEN’s failure to keep the rest of us informed about what’s going on. This is a very important piece of legislation, which will finally bring U.S. corporate transparency into the 21st century, give law enforcement agencies the ability to see behind the country’s appallingly opaque shell companies and deprive criminals of one of the most secure hiding places for dirty assets. It must be done, and it must be done right, as this separate report for the subcommittee from Transparency International makes clear.

FinCEN officials regularly (and rightly) complain about the underfunding of their agency, which has barely two-thirds of the personnel of its Australian counterpart, AUSTRAC, even though it serves an economy 10 times the size. Despite the many tasks being put before it, FinCEN looks likely to get 12.7% less money next year rather than the extra resources that it needs.

However, as Richard states, FinCEN is perversely responding to this lack of resources by producing rules and regulations so complex “only a New York lawyer can figure (them) out.” Underscoring the complexity, Richards’ critique alone is 41 densely-typed pages long, and it lays out a bewildering list of rules, notices, regulations and rulemakings still outstanding.

• “If the reason(s) why FinCEN is struggling to meet its mandate are resource constraints, it would be doing the opposite of what it is doing: It would be putting out two simple, incremental rules (and proposed rules), while acknowledging that it must keep things simple since it doesn’t have the resources to do any more than what Congress intended. And the complexities of the reporting rule and proposed reporting form, and the proposed access rule, make FinCEN’s resource situation even worse: complex reporting and access forms and rules mean they need even more detailed guidance and even more people manning the help line(s). They are compounding their resource issues,” Richards notes.

To which I would add: Complexity creates loopholes. It is far harder to find discrepancies in simple rules than in complex ones. Professional enablers love complexity, which only they can afford to understand. And complexity is not just expensive for FinCEN but for all the financial service companies that will need to abide by its rules. The more expensive implementation is, the less inclined private firms will be to comply fully. I hope there is someone in Congress sufficiently interested in this issue to push FinCEN into rethinking. Keep it simple please, people.

If you’d like to know what happens when you get it wrong, read this blog about long-overdue efforts to undo the catastrophic side effects of ill-thought-through reforms to the implementation of the U.K. companies law.

THE HAVES VS THE HAVE YACHTS

Back in March, I alerted you to a yacht-shaped bargain — the Alfa Nero, sitting unclaimed in Antigua and being auctioned off by the government. This particular 267-foot marine masterpiece was sanctioned by the U.S. a year ago in response to Russia’s full-scale invasion of Ukraine and had been gathering seaweed ever since, so the Antiguans decided to flog it off.

Google founder Eric Schmidt heard about the sale (perhaps from this newsletter — if so, hi Eric!) and bought the yacht for $67.6 million back in June. But now Yulia Guryeva-Motlokhov, the daughter of sanctioned Russian oligarch Andrey Guryev, has challenged the sale because she is apparently the sole beneficiary of the Guernsey-based trust that holds 100% of the shares of the British Virgin Islands-based company that owns the currently-Antigua-based yacht.

• “We would not be filing an appeal unless we had good and sound reasons to bring the appeal. We think the action of the government in taking possession of the yacht and selling the yacht is wrong on all levels,” said her attorney, Dr. David Dorsett.

The highest-risk months for hurricanes in Antigua are August, September and October, so — if the weather is particularly severe over the next little while — the delay in moving the yacht triggered by this legal challenge could prove very costly indeed. The last time I was in the British Virgin Islands, a couple of years had passed since Hurricane Irma but there were still drifts of smashed yachts in every cove. It doesn’t matter how much a yacht costs or how many helicopters it can land on its afterdeck: In a battle with a rock, there will only ever be one winner. There’s a metaphor in there somewhere.

WHAT I’VE BEEN READING
I was lucky to obtain an advanced copy of “A Death in Malta,” a book by Paul Caruana Galizia, an award-winning journalist and the son of Daphne Caruana Galizia, who was murdered in Malta in 2017. It is at once a tribute to his mother, whose own journalism infuriated the sleazy political elites of her homeland, a history of Malta and an account of the author’s and his brothers’ quest for justice. It’s touching and infuriating and urgent, and I recommend it to all of you.

The post How NATO can help beat back corruption in Ukraine appeared first on Coda Story.

Ferdinand Marcos Sr. is notorious for his flagrant abuses of human rights, most of which occurred when he put the Philippines under martial law for nearly a decade, beginning in 1972. Since 2019, our friends at Rappler have documented how propaganda spread by Bongbong Marcos supporters and campaign workers across Facebook, Twitter and YouTube helped pave the path to electoral victory in 2022.

But Marcos hasn’t just flooded the zone with disinformation about his record and historical revisionism about his family. He has also continued to pursue threats against websites belonging to small media and civil society organizations. In one case, originally brought by his predecessor Rodrigo Duterte’s administration, officials ordered the National Telecommunications Commission to block independent media sites such as Bulatlat and Pinoy Weekly, alongside a smattering of civil society groups’ websites. The order cited the country’s Anti-Terrorism Act, insinuating that the sites were somehow undermining national security.

My old colleague Mong Palatino, an editor at Global Voices who has worked with Bulatlat, got me up to speed on how affected websites have been responding. The case has them working overtime on their defense, but they are undeterred, he said.

“If the intent is to silence these groups, then the authorities have failed,” Palatino told me. Just as the major social media platforms have helped the Marcos family recast their image, they have also given smaller, more critical media and civil society groups an alternative platform that’s not so easy for the government to snuff out.

“The blocking of websites didn’t prevent these groups from reaching the public through other platforms and social media,” Palatino said. “But we continue to challenge the order and call for its withdrawal,” he added. “It could set a dangerous precedent if authorities continue the systematic crackdown against dissenting voices.”

GLOBAL NEWS

Is Russia thinking about cutting itself off from the global internet? Network observers wish they knew. On July 5, a hiccup in international web traffic moving in and out of Russia came during a test that industry sources told RBC was intended to “check whether the Runet really continues to work” if the country cuts itself off from the global internet. The test seems to have caused brief lapses in connectivity for local sites, as well as major platforms, including Google and Wikipedia. As I wrote in my last edition, the war in Ukraine has made it a whole lot harder for people in Russia to find reliable information about what’s happening on the frontlines and in the halls of power. Although Russia has run tests of its “sovereign internet” in the past, yielding similarly glitchy results, the timing of this one has understandably put Runet watchers on edge. 

“Russian internet experts tell me they doubt Roskomnadzor’s claim that the Sovereign Internet testing was ‘successful’ as the documented internet outages were scattered & not wide scale,” wrote Access Now’s Natalia Krapiva on Twitter. “Sounds like Putin won’t be able to isolate people any time soon, but he’ll keep trying.”

Further complicating the Russian information landscape is Twitter’s new pay-to-play verification system, which appears to be boosting disinformation about the war. The BBC has a new investigation showing a series of viral tweets promoting demonstrably false reports about the war, ranging from a completely fabricated story about “baby factories” in Ukraine that are selling children into sexual slavery to a heavily twisted spin on the future of elections in Ukraine. They’ve all come from accounts with the blue checkmark that now confirms absolutely nothing about its bearer, apart from the fact that they can afford the $8 monthly fee. Nice work, Elon.

Millions of Bangladeshi citizens’ data was leaked and left online recently, only to be discovered by a security researcher who stumbled upon the leak while running a routine Google search. The data, which includes people’s full names, phone numbers, email addresses and national ID numbers, was in the possession of a government agency that the researcher opted not to name, in the interest of protecting the privacy of the millions who could be affected by the leak. Similar to neighboring India, while Bangladesh’s efforts to digitize its national ID system may be intended to help streamline things like the delivery of social services, they have brought serious unintended consequences when it comes to data privacy.

If you’re sitting somewhere in the U.S. and saying to yourself, “phew, nothing for me to worry about this week,” hold that thought. A Nebraska woman pleaded guilty last week to helping her teenage daughter get abortion pills and has been sentenced to two years in jail. The story is painful to read and think about, and most of what it deals with lies beyond the scope of this newsletter. But what drew me to the item was the fact that Facebook messages, sent between the woman and her daughter, were a key piece of evidence used against her. If Facebook were to offer end-to-end encryption on its Messenger service by default, the company would have had nothing to hand over when the prosecutors came knocking. But it doesn’t. As state-level crusades against people seeking abortions continue to play out in post-Roe America, I have no doubt that we’ll see many more cases like this one. If you haven’t already, I suggest you go download a real end-to-end messaging app, like Signal.

WHAT WE’RE READING (AND LISTENING TO)

• Two editions ago, I wrote about the hundreds of migrants who died in the Mediterranean sea in early June and pointed to the increasing use of surveillance by state border agencies seeking to keep migrants from entering the EU. Foreign Policy’s Andrew Connelly has a compelling new essay on the same topic that is very much worth a read.

• The Meta Oversight Board recently recommended that Facebook suspend Cambodian President Hun Sen from the platform for six months — this is especially serious since elections are coming up later in July. Sen responded by closing his account altogether and kicking Meta employees out of the country. Rest of World has a good play-by-play on the ongoing fallout.

• The Wall Street Journal’s Karen Hao has a great new podcast out of Kenya, where she interviewed people who are struggling with PTSD after working on the frontlines of content moderation for ChatGPT.

The post Philippine leader Bongbong Marcos’ digital disinformation regime appeared first on Coda Story.

I have just been for a fortnight’s jaunt to the Pacific, in which I sought stories I can tell in the new book I am researching. It was by turns fascinating, fun and frustrating, and I look forward to sharing some of the tales with you. I spent a week in the Commonwealth of the Northern Mariana Islands, a little bit of America that feels extremely far from the United States, and a week in the Marshall Islands, which feels extremely far from anywhere.

The journey back was delayed by United Airlines, which cost me a couple of days and resulted in my jetlag colliding with a long-scheduled, weekend-long party at my house, and I am feeling more than a little vague. Apologies therefore in advance that this newsletter is shorter than normal (and if it doesn’t make much sense).

TRUST TAKEOVER

Around 2 a.m. on Saturday, while sitting around a fire, I had a conversation with some friends about dodgy money and, specifically, about the best place to stash it. And, yes, this is the kind of thing I talk about at parties. (I’m pretty sure they were asking my opinion just for interest’s sake rather than because they wanted investment advice, since if any of them were a billionaire, they’d probably be at a more glamorous venue than my garden, but for the avoidance of doubt, seek advice from a regulated professional, etc., etc., rather than from a scurrilous muckraker like me.)

I thought about it for a while and said that the answer was probably South Dakota, thanks to the state’s trust legislation, which creates an unrivaled shield around money placed therein, protecting it from governments looking to tax it, creditors looking to confiscate it and journalists looking to scrutinize it — the three threats to a billionaire’s peace of mind.

However, on sober reflection and in the cold light of a new week, I think I should have pointed out that the question is based on a misleading premise, which is that money is located somewhere concrete rather than just suspended in the glittering cloud that is the offshore financial system — nowhere and everywhere at the same time.

And, on that note, I was interested to see while I was away a merger between a star of the old-fashioned British offshore wealth management setup and a leader in the new/thrusting U.S. equivalent, with Jersey’s JTC buying the South Dakota Trust Company, which did more than anyone to create the South Dakotan industry.

The names quoted in the press release alone — JTC’s Nigel Le Quesne, with his English first name/French surname combination, and SDTC’s Pierce H. McDowell III and Al W. King III, with their middle initial/terminal numeral combination — are almost ludicrously stereotypical as representatives of Jersey and South Dakota.

But don’t be distracted by that. The important bit, in my opinion, is at the bottom, with the list of jurisdictions that JTC is now regulated in: British Virgin Islands, Cayman Islands, Guernsey, Jersey, Luxembourg, Mauritius, the Netherlands, South Africa, Switzerland, the Isle of Man, Abu Dhabi, The Bahamas, Dubai, the United States (as well as, separately, Delaware and South Dakota), the Republic of Ireland and the United Kingdom.

This is not unusual. All major wealth management companies will have a similar global presence. But what does it mean?

Well, while on the plane between Seoul and London, I watched last year’s Oscar winner “Everything Everywhere All At Once,” which features Michelle Yeoh as a (literal, rather than metaphorical) laundromat operator who learns how to tap into the skills of herself in millions of parallel universes, so she can suddenly do kung fu, sing or wave signs around, in the service of saving the multiverse and getting on better with her daughter.

In the more far-fetched realm of wealth management, having a presence in dozens of jurisdictions does a similar job. The moneymen at major companies have a complete overview of what’s possible all over the world so that when laws or political circumstances change, they can pick up skills from parallel jurisdictions as quickly as Yeoh can learn to play the piano with her feet and move their clients’ money accordingly. They slip it out of Switzerland ahead of a regulatory change, adding a BVI company here, an Irish/Dutch combination there, all of it reducing the chance of the cash being taxed, confiscated or scrutinized. In fact, “Everything Everywhere All At Once” would be an excellent mission statement for a billionaire’s private office. 

This interesting bit of analysis from Ruchir Sharma, based on this year’s Forbes Rich List, shows the consequences of a world where — no matter what kind of government you live in, whether it’s “big” like in France or “small” like in the U.S. — the rich always come out on top.

• “Socialist tendencies may backfire by concentrating rather than spreading wealth. Increasing regulation favors big tycoons, who have the lobbyists and money to navigate an expanding thicket of rules. And since 2000, while governments have pumped money into their economies to keep growth alive, much of it wound up fueling the rise in financial markets instead,” Sharma notes.

If billionaires’ wealth can be kept safe from predation, it will compound in perpetuity, meaning that the rich will get richer and the poor will become more numerous, giving the rich greater lobbying power and thus more sway over the regulation of their wealth.

For those of us who think this is a recipe for defunded governments, denuded democracy and — with time — a creeping return to feudalism, what can we do? It’s easy to see this as too hard a problem and to focus on something more straightforward like nuclear fission. But that would be foolish, there are good ideas out there if you look carefully.

The U.K. Parliament is currently debating a law to properly regulate Britain’s fetid swamp of a corporate registry, which has long provided structures used in fraud, tax evasion and kleptocracy. Under a new amendment proposed by a former government minister in the House of Lords, the transparency rules would also apply to trusts, meaning trustees would have to reveal who benefits from the wealth they look after, thus closing crucial loopholes. Ministers are pushing back, by claiming that the proposal would be costly for the British economy, but that is an illogical permission.

• “That should be put against the cost to the economy of the fraud and economic crime that is happening at the moment at an increasing rate. We have endlessly reminded ourselves that 40% of all crime in this country is now economic crime. I know from my time in government that the loss to fraud in government alone each year — this is the bottom-end estimate by the National Audit Office — is 30 billion pounds, and a lot of that is facilitated through the holes in the Companies House structure,” Lord Agnew said.

That is the right way of looking at the problem. Yes, tackling the hydra-headed wealth management industry would be expensive, but doing nothing has a cost too because we can be sure that the wealth management industry is very active indeed. Pleasingly, most trusts will be covered by the U.S. Corporate Transparency Act when it comes into effect next year. Although the information will not be public, at least it will be collected, meaning the authorities will know who stands behind the swelling volume of wealth hidden behind legal structures.

While on the subject of the Forbes Rich List: As of the moment of writing, the world is only $100 million away from gaining a 10th centibillionaire, since Larry Page — the founder of Google and the 10th richest man on the list — has a personal fortune of $99.9 billion. That is just a small stock price movement away from membership in the world’s most exclusive club. And, just think, it was only in September 2020 that I marveled in this newsletter about a second person’s net worth coming with eleven zeros. Now that seems positively old hat.

How long until we gain a trillionaire? Less time than I’d like.

WHAT I’VE BEEN READING

I had a lot of time to read while on the many flights I took to the Pacific, around the Pacific and back from the Pacific, of which I think the highlight was Jonathan Eig’s biography of Martin Luther King Jr. By stripping away much of the hagiography around Dr. King, it made him — for me anyway — somehow more admirable. And by situating him in the context of the short generations that separated him from slavery, it made him all the more extraordinary.

Struck by Eig’s prose style and looking for other good books to read, I then read his biography of Mohammed Ali, which is written in a similarly engaging way and has a postscript so touching it made me cry. Finally, I completed an Eig trilogy by reading his history of the development of the contraceptive pill, which is also remarkable.

The post Wealth concealment enters an era of geographical ubiquity appeared first on Coda Story.

Russians looking for real information about why Wagner troops traveled all that way only to turn around, and why Wagner’s leader hightailed it to Minsk, were hard-pressed to find it. It wasn’t surprising. Since Russia’s war on Ukraine began, news outlets that aren’t aligned with the Kremlin have scarcely been able to operate, and the vast majority of independent media and their journalists now work outside the Russian territory. In the days since the not-coup, even more websites have been taken down, and searches on Wagner Group leader Yevgeny Prigozhin’s name were blocked on Yandex, Russia’s leading search engine, and on VK, the country’s answer to Facebook.

While Russia watchers observed Kremlin-aligned media handling the incident somewhat clumsily, Prigozhin seemed to have captured much of the narrative thanks to his Telegram channel, a signature platform that he has leveraged for some time. Prigozhin has long been a savvy propagandist and early player in the global disinformation game. He launched and led Russia’s Internet Research Agency, the troll farm that became notorious for its attempts to malignly influence the 2016 U.S. national elections.

The particulars of this week’s events aside, I find myself thinking about the broader effects of the past 16 months on Russia’s information environment. Sure, Russia was never shy when it came to internet censorship — years of evidence from groups like OONI and Freedom House make this clear. But the invasion of Ukraine, as well as the government’s growing need to control what information people can access, has put Russia in a digital quarantine of its own making. Major social media platforms, including Facebook and Twitter, have been blocked since the start of the war. Hundreds of thousands of websites, many of them reporting and publishing news to high standards, are no longer accessible. And more sites and applications seem to discontinue their services in Russia every day. 

Just yesterday, my colleague Ivan Makridin lamented that Slack had stopped offering its services in the Russian language. This may sound banal. But it adds to the digital and professional isolation of Russians. And it makes it easier for Putin to spread his propaganda.

GLOBAL NEWS

A Polish LGBTQ rights activist says Twitter has handed his data over to Poland’s Ministry of Justice. Bart Staszewski, an influential advocate and filmmaker based in Warsaw, tweeted photos of an order from the U.S. Department of Justice, submitted on behalf of Polish authorities, demanding his data from the Silicon Valley company. Staszewski didn’t disclose how he got a copy of the order but said he believes it is politically motivated.

“@Twitter (now @elonmusk) is giving access to my account based on false accusation [sic] of Polish right-wing government officials. It should be a warning point for all activists and whistleblowers from East Europe,” he tweeted. “You don’t need #Pegasus, or china spy software – you just need to abuse legal tools and ask for international help. Disgusting.”

Another Pride Month slap in the face came from Netflix last week, this time in Kenya, where the U.S.-based streaming giant agreed to stop all programming featuring LGBTQ characters and themes. Netflix Africa made the change as part of an agreement with the Kenyan Film Classification Board, which restricts programming that “glorifies, normalizes, promotes and propagates homosexuality,” in accordance with Kenyan law. Although same-sex relations are already criminalized in Kenya, right-wing legislators are pushing to expand laws that would restrict LGBTQ people’s rights, with the so-called “Family Protection Bill,” which invites unfortunate comparison to neighboring Uganda’s increasingly homophobic regime. 

Transgender people in Tennessee are afraid that their data is no longer safe with their doctors. Vanderbilt University Medical Center handed over medical records for a group of transgender patients to the state attorney general’s office, as part of what state officials say is a billing fraud inquiry. As per hospital policy, Vanderbilt notified the patients and their families, sparking instant concern about the safety of their data in Tennessee, where Governor Bill Lee approved a law in March that bars minors from receiving gender-affirming healthcare.

It’s a good time to start using end-to-end encryption, whether it’s the Polish Ministry of Justice, the Tennessee AG’s office or some other judicial authority you’re worried might come after your data. But that could be tough in the U.K., if the so-called Online Safety Act is to pass. This week, Apple joined the ranks of Signal and WhatsApp when it publicly criticized the draft law’s provisions requiring companies to water down security standards in order to allow authorities to more easily scan people’s communications for child abuse material. As Signal President Meredith Whittaker put it, “Encryption works for all or it’s broken for all. There’s no safe, private way to conduct mass surveillance. & no amount of magical thinking or specious claims will alter this stubborn reality.”

WHAT WE’RE READING (AND LISTENING TO)

• Jacobin Radio has a fresh new episode featuring AI real-talkers Meredith Whittaker, Edward Ongweso Jr. and Sarah Myers West on the “mundane dystopia concealed beneath the AI hype machine.”

• Writing for Rest of World, Liani MK has a great new immersive feature on how indigenous groups in Malaysia are using digital mapping tools to assert their land rights.

The post Russia’s digital scramble to control the ‘coup’ narrative appeared first on Coda Story.