Disinformation and ‘fake news’: Interim Report Contents

6SCL influence in foreign elections

Introduction

205.The influencing of elections by foreign powers, through the distortion of facts, or by the micro-targeting of voters, to persuade them to vote in a certain way, or to suppress their desire to vote at all, has been a reoccurring theme throughout this inquiry. This chapter will explore the disturbing inter-relation between disinformation and the manipulation of election campaigns, concentrating on the work of SCL Elections, and associated companies.

General

206.The Committee received evidence about the role of SCL Elections, a company that Alexander Nix formed, as an offshoot of SCL Group, in 2011, and its role in foreign elections, including its use of misinformation, disinformation and micro-targeting, which may have crossed the line into unethical, or even illegal behaviour. A Channel 4 undercover investigation, broadcast in March 2018, filmed Mark Turnbull, former Managing Director of SCL Elections, and Alexander Nix, the then CEO of Cambridge Analytica, talking about using misinformation, dirty tricks and the manipulation of social media to influence elections around the world, and boasting of using bribery, honey traps and sex workers to discredit politicians and to influence the political outcome of elections in elections in several countries.257

207.Mr Turnbull also talked about the manipulation of social media companies, in order to distribute negative material on political opponents, done in such a way so as not to be identified as the source of the material:

You’re creating social media content that you’re putting out into social media and you’re just gently amplifying, by hitting influential people who have huge following on Facebook and Twitter, so they retweet, re-post, and so this stuff infiltrates the online community and expands, but with no brand, so it’s unattributable, untrackable. […] [W]e just put information into the bloodstream to the Internet, and then watch is grow, give it a little push every now and again, over time, to watch it take shape.258

208.Mark Turnbull described how they “ghosted in and ghosted out” of election campaigns.259 In a recorded telephone conversation with the Channel 4 reporter, Alexander Nix said that “we do incognito very well indeed, in fact we have many clients who never wish to have our relationship with them made public. […] And, we’re used to that, we’re used to operating through different vehicles, in the shadows, and I look forward to building a very long-term and secretive relationship with you”.260

209.When Alexander Nix first gave evidence to us, he described SCL’s political work:

We have been running election campaigns since 1994. We take on a number of national elections every year. That could be three, four, five, six, seven elections across the world in every single year for prime ministers and presidents. That could be in Asia, Latin America, Europe, Africa or beyond. […] We have a political division, but our political division is only, say, 20% or 25% of our entire business.261

210.The following election and referenda campaigns were mentioned by Mr. Turnbull and Mr. Nix, over the course of the Channel 4 meetings: Kenya, Kenyatta campaign 2013; Kenya, Kenyatta campaign 2017; Ghana 2013; Mexico; Brazil; Australia; Thailand; Malaysia; Indonesia; India; Nigeria; Pakistan; Philippines; Germany; England; Slovakia; Czech Republic; and Kosovo.262 Ex-SCL employees have also mentioned: France; Guyana; Gambia; Germany; Italy; Kenya; Malaysia; Mongolia; Niger; Nigeria; Peru; St Kitts and Nevis; St. Lucia; and Trinidad and Tobago. SCL may also have worked on the Mayoral election campaign in Buenos Aires in 2015 for Mauricio Macri, including delivering some target audience analysis work.263

211.We were told that, behind much of SCL Elections’ campaigning work was the hidden hand of Christian Kalin, Chairman of Henley and Partners, who arranged for investors to supply the funding to pay for campaigns, and then organised SCL to write their manifesto and oversee the whole campaign process. In exchange, Alexander Nix told us, Henley and Partners would gain exclusive passport rights for that country, under a citizenship-by-investment (CBI) programme.264 Alexander Nix and Christian Kalin have been described as having a ‘Faustian pact’.265 With the exclusive passport rights came a government that would be conducive to Mr. Kalin and his clients.266

212.Alexander Nix told the Committee that, at times, SCL Elections would undertake eight, nine or 10 elections a year, “and we are not limited by geography, so this really could be from the Caribbean to Asia to Africa to Europe or everywhere”.267 When asked about his involvement in the elections with Mr Kalin, including in St Kitts and Nevis, Dominica, St Vincent and the Grenadines, and the Referendum in St Vincent and the Grenadines, he responded:

I was familiar with Christian Kalin because he had worked in some of the Caribbean islands. I know he used to run a citizen-by-investment programme, certainly in St Kitts and possibly the Dominica. I do not know about the other countries.268

213.He told us that Mr Kalin “may well have made contributions towards the election campaigns, but you would have to talk to him about that. […] [M]y understanding is that he may well have financed some of the elections or given contributions towards some of the elections”.269 This chapter will explore the specific examples of misinformation, disinformation, and malign manipulation that the SCL Group, SCL Elections, SCL Social, and associated companies undertook in certain countries.

St Kitts and Nevis

214.SCL worked on a campaign to win the 2010 general election in St Kitts and Nevis, in the Caribbean, and, according to Freddy Gray, of The Spectator:

SCL practised the dirty trick—or ‘counter ops’—that Nix was caught bragging about to undercover reporters in [… the] Channel 4 expose. Nix was not exaggerating. One of the dirty tricks was a sting operation in St Kitts and Nevis. SCL filmed the opposition leader, Lindsay Grant, being offered a bribe by an undercover operative posing as a real-estate investor. Grant didn’t exactly help himself by accepting the bribe and even suggesting which offshore bank accounts the money could be paid into.270

215.According to evidence we received, this sting operation was arranged entirely by SCL, with the undercover operative—a temporary SCL employee—being paid around £10,000 by Alexander Nix, for the work that they had carried out. Alexander Nix told us that Christian Kalin had run a citizenship-by investment programme in St. Kitts and Nevis.271

216.When asked to comment on whether the sting on Lindsay Grant, orchestrated and filmed by SCL, happened, Mr Nix told us that that was nothing more sinister than the undercover reporting that Channel 4 was undertaking itself, and implied that both the SCL and Channel 4’s reporting were equivalent in nature. Nothing could be further from the truth. Channel 4’s investigation was legitimate journalism; SCL’s activities involved the offering of a bribe to an Opposition Leader, with the explicit intention of influencing an election.272 In the Channel 4 exposé, Mr Nix and Mr Turnbull talked to who they thought was a potential client, and voluntarily exposed techniques that they stated were standard procedure in the company.

217.Henley & Partners have held the exclusive passport rights for St Kitts and Nevis since before 2009. According to the article by Ann Marlowe: “For the bargain price of $150,000, approved applicants who donate to the island’s sustainable growth fund can now obtain a passport that, as of 2009, allows visa-free travel to over 100 countries, including the UK and the 26-nation European Schengen zone”. By 2014, passports had become St Kitts and Nevis’ biggest export (St Kitts does not require citizens to live there), with the revenue accounting for around 25% of GDP.273 Ann Marlowe wrote:

Many of the passport holders are from countries with unpopular passports who may otherwise have trouble obtaining travel visas—think Iran, China, Russia, Afghanistan, Pakistan. The firms say their well-heeled clients are seeking protection against unpredictable situations at home amid an era of terrorism fears and economic instability.274

Trinidad and Tobago

218.Evidence submitted by Christopher Wylie highlighted the fact that SCL was influencing the election by disseminating disinformation about the voting preferences of young adults, by fabricating content that they said had come from young people, and then acting on those views:

Trinidadian elections are affected by the population’s mixed ethnicity: political leaders from one group have difficulty in making their messages resonate with those outside of it. Working from this 2009 finding, SCL designed an ambitious campaign of political graffiti that disseminated campaign messages that ostensibly came from the youth. The client party was then able to adopt related policies and claim credit for listening to a ‘united youth’.275

SCL worked on elections in Trinidad and Tobago in 2010, where their main contact for organising payments related to the campaign appears to have been the disgraced former FIFA executive Jack Warner.

Argentina

219.The Committee saw confidential evidence—a summary of a management meeting at SCL Group from 27 May 2015—in relation to an anti-Kirchner276 campaign in Argentina, describing “close proximity intelligence gathering efforts” and “information warfare”, and the use of “retired Intelligence and Security agency officers from Israel, USA, UK, Spain, and Russia”, and the creation of false Facebook and Twitter accounts to support the anti-Kirchner campaign.277 When questioned whether SCL Group had worked for an opposition party, or some other person interested in influencing politics in Argentina, against the Government, Alexander Nix replied, “That would be the appearance of that, yes”.278

Malta

220.Henley & Partners has been Malta’s exclusive passport agent since it helped to launch its citizenship-by-investment (CBI) programme in 2013. Henley & Partners was granted permission to control the selling of citizenship to eligible investors in Malta, at a cost of €650,000 per passport. As Malta is in the EU, this was especially valuable.279 We have evidence to show that Dr Kalin was meeting representatives from both political sides in Malta, with a view to mutually-beneficial arrangements. The evidence also shows that Christian Kalin asked SCL to introduce him to Joseph Muscat, the Leader of the Opposition at the time, in June 2011, and indicates that SCL had been advising Malta’s Labour Party for several years before the 2013 elections.280 It is believed that SCL, or its associated companies, worked with the Labour Party there, on the 2013 general election campaign in Malta.

221.Daphne Caruana Galizia, the Maltese investigative journalist, was investigating the Maltese CBI passport scheme, as well as organised crime in Malta. In October 2017, she was assassinated by a car bomb. On her blog, she wrote “The damage caused to Malta by the sale of citizenship is unquantifiable. Malta is not St. Kitts & Nevis. It is interlocked with the rest of the European Union and has a European economy. […] And the Maltese government is the only EU member state government with which they [Henley & Partners] have a contract”.281

222.In April 2018, a consortium of 45 journalists from 18 news organisations, including The Guardian, The New York Times, Le Monde, and the Times of Malta, published “The Daphne Project”, a collaborative effort to complete Caruana Galizia’s investigative work.282 A week after Daphne Caruana Galizia’s assassination, the Maltese Prime Minister Joseph Muscat attended a ‘Global Citizenship’ conference in Dubai, which was hosted by Henley & Partners, saying that Malta was ‘open for business’. Recently, Lord Ashcroft extolled the virtues of Malta, as the “best destination for ambitious UK firms” to have a post-Brexit presence in the EU.283

Nigeria and Black Cube

223.Black Cube, a corporate intelligence organisation, is “a select group of veterans from the Israeli elite intelligence units that specialises in tailored solutions to complex business and litigation challenges” and claims that “using our unique intelligence methodology, Black Cube enhances its clients’ decision making by providing otherwise unobtainable information”.284 Mark Turnbull told the Channel 4 news reporter: “We have relationships and partnerships with specialist organisations that do that kind of work.” He went on to say, “So that […] you know who the opposition is, you know their secrets, you know their tactics.”285

224.Alexander Nix later told the Channel 4 reporter: “We use some British companies, we use some Israeli companies.” One of the Israeli companies he said that Cambridge Analytica used was Black Cube.286 When asked in oral evidence to confirm this, Alexander Nix said: “I think in the transcript—because I did read this—he said, “Have you worked with Black Cube?” and I replied, “Yes”. I was totally mistaken. We have never worked with Black Cube”.287

225.When Brittany Kaiser gave evidence, she denied that she knew the Israeli cyber security contractors, but told the Committee that two people “came to the office for maybe an hour one day, and plugged something into a computer to show some pieces of information that they had obtained from the opposing campaign”.288 Christopher Wylie told us that “Black Cube was engaged to hack the now President of Nigeria, Buhari, to get access to his medical records and private emails. AIQ worked on that project.”289

226.We also received an extremely disturbing video from both Brittany Kaiser and Christopher Wylie. Mr. Wylie described the video: “people were being dismembered, were having their throats cut and bleeding to death in a ditch, being burned alive. There are incredibly anti-Islamic and threatening messages portraying Muslims as violent”.290 Jeff Silvester, from AIQ, wrote in evidence to us that AIQ were asked by SCL to promote the video with online advertising, but AIQ refused.291

227.Furthermore, a promotional case study of international projects includes a section on Nigeria, which explains how SCL encouraged potential opposition voters not to vote:

SCL was able to advise that rather than trying to motivate swing voters to vote for our clients, a more effective strategy might be to persuade opposition voters not to vote at all—an action that could be easily monitored. This was achieved by organising anti-election rallies on the day of polling in opposition strongholds. These were conducted by local religious figures to maximise their appeal especially among the spiritual, rural communities.292

228.Equally worrying is the fact that the SCL Group carried out work “for the British Government, the US Government and other allied Governments”,293 which meant that Mr. Nix and the SCL Group and associated companies were working for the UK Government, alongside working on campaigning work for other countries. Mr. Nix also told us that Christian Kalin was working for the UK Government at the same time.294 We published a Ministry of Defence approbation of SCL, after SCL provided psychological operations training for MOD staff, which revealed that SCL was given classified information about operations in Helmand, Afghanistan, as a result of their security clearances.295 Alexander Nix explained that SCL “is a company that operates in the government and defence space, it acts as a company that has secret clearance”.296

Conclusion

229.Alexander Nix appeared twice before the Committee, in February and in May 2018. His second appearance was after the Channel 4 undercover report had filmed him describing the work that SCL carried out in foreign campaigns: “These are just examples of what can be done […] and what has been done”. When we asked about the report, Mr Nix told the Committee that he had sullied his own reputation, by “exaggeration and hyperbole”, in order to win a client contract: “I alluded to services that we do not make and never made as a company. Yes, it was extremely foolish of me”.297 Given the evidence that we received through the course of this inquiry, it is hard to believe that Mr Nix’s admissions on Channel 4 were as a result of ‘exaggeration and hyperbole’, rather than based on his direct experience of overseeing many elections abroad.

230.The work of SCL and its associates in foreign countries involved unethical and dangerous work, and we have heard worrying accounts of SCL employees being put in grave danger. Paul Oliver Dehaye described the work that Dan Muresan, an employee of SCL, had to do, while employed by SCL: “He was working for Congress, according to reports from India, but he was really paid for by an Indian billionaire who wanted Congress to lose. He was pretending to work for one party but was really paid underhand by someone else”.298

231.We received disturbing evidence, some of which we have published, some of which we have not, of activities undertaken by the SCL-linked companies in various political campaigns dating from around 2010, including the use of hacking, of disinformation, and of voter suppression, and the use of the services of Black Cube, an Israeli private intelligence service, whose work allegedly included illegal hacking. We also heard of the links between SCL and Christian Kalin of Henley and Partners and their involvement in election campaigns, in which Mr Kalin already ran or subsequently launched citizenship-by-investment programmes, involving the selling of countries passports to investors. SCL’s alleged undermining of democracies in many countries, by the active manipulation of the facts and events, was happening alongside work done by the SCL Group on behalf of the UK Government, the US Government, and other allied governments. We do not have the remit or the capacity to investigate these claims ourselves, but we urge the Government to ensure that the National Crime Agency thoroughly investigates these allegations.


262 Information from Channel 4.

263 Confidential evidence/meetings with ex-SCL employees.

264 Alexander Nix, Q3381

265 What was it really like to work for Cambridge Analytica, Freddy Gray, Spectator podcast, 4 May 2018

270 ‘Revealed: Cambridge Analytica and the passport King’, Freddy Gray, The Spectator, 27 March 2018, accessed June 2018.

273 How Cambridge Analytica Fuelled a shady global passport bonanza, Ann Marlowe, Fast Company, 1 July 2018.

274 How Cambridge Analytica Fuelled a shady global passport bonanza, Ann Marlowe, Fast Company, 1 July 2018.

276 Cristina Kirchner was President of Argentina from 2007 to 2015

277 Confidential evidence shown to the Committee, 5 June 2018

279 Malta is not for sale website, accessed 23 July 2018

281 No wonder Henley & Partners have broken out into a cold sweat, Running Commentary: Daphne Caruana Galizia’s Notebook, 12 May 2017

282 The Daphne Project, The Organized Crime and Corruption Reporting Project (OCCRP), accessed 1 July 2018.

284 Black Cube website, accessed 12 July 2018

285 Channel 4 transcript of exchanges, not published

286 Channel 4 News transcript of exchanges, not published

289 Q1299, also verified by another source

291 AggregateIQ (FKN0086)

298 Paul-Olivier Dehaye, Q1374




Published: 29 July 2018