The Investigative Dashboard: Hacking Crime and Corruption

Paul Radu is building a platform for the hacker community to collaborate with investigative journalists to expose the most vile, dangerous, and bizarre global corruption you never knew existed. Paul is the executive director of the Organized Crime and Corruption Reporting Project (OCCRP). And if you are in San Francisco tomorrow, Friday, April 27, Paul and OCCRP advising editor Drew Sullivan are speaking at a special free event, Hacking Corruption, hosted by Institute for the Future and Code for America. The evening will begin with an introduction and comments by Marina Gorbis, executive director of Institute for the Future, and Tim O’Reilly, founder and CEO of O'Reilly Media, Inc. For those who can't be there in person, Boing Boing is honored to share our forum with Paul so he can share his amazing, inspirational work with all of us. -- David Pescovitz

The Investigative Dashboard: Hacking Crime and Corruption

by Paul Radu

One of the pioneers of globalization has been organized crime. Their illicit businesses form a $ 2 trillion plus global industry supported by the criminal services industry: the lawyers, hedge fund managers, business registration agents, bankers and others who help hide, legitimize and launder illegal profits.

But increasingly around the world, journalists and civil society organizations have taken notice and are fighting back.

A handful of researchers from the Organized Crime and Corruption Reporting Project sit in front their computers in Sarajevo or Bucharest in Eastern Europe and assist investigative reporters from all over the world in untangling the complicated schemes used to hide the proceeds of the global drug trade or the stolen billions of corrupt dictators. This is the Investigative Dashboard (ID), the initial phase of a global research desk that gives journalists the tools and support needed to fight back.

The basis of most crime networks are simply businesses and bank accounts set up by the criminal services industry in a manner designed to be as opaque as possible. Using offshore accounts, proxies and seemingly unrelated businesses in many different jurisdictions, they move money around always staying steps ahead of slow moving law enforcement.

Cronies of the former Egyptian dictator Hosni Mubarak hid their billions of dollars in complex corporate structures that include companies in British Virgin Islands, Egypt, Switzerland, Spain, Panama, Azerbaijan and Romania. The family of Ilham Aliyev, the president of Azerbaijan, uses Panama and United Kingdom-based corporations to hide their ownership in mining, the telecom industry or the financial sector in their country. Organized crime groups such as the Mexican Sinaloa drug cartel use even more complex, multiple layered schemes to launder the proceeds of their violent crimes.

ID researchers comb every day through myriads of databases: national and international registrars of companies, online and offline court records and many others. The gathered data is fed back to the journalists and turned into investigative stories.

OCCRP and ID tell the public how their money is stolen and, more important, how to prevent the theft in the first place by being pro active. Criminals have for a long time been able to move their operations across borders once they were detected by law enforcement inside a country. They look for weak countries with corruptible officials where they can transplant their crime models undetected. We want to change that. We are currently developing databases where names of people and companies involved in organized crime activities are indexed together with all the public records documenting their activities.

It's an uneven playing field. On one side is criminals and organized crime with almost umlimited wealth at their disposal, strong connections to politicians and all the legal help they can buy. On the other side are reporters and activists with scarce resources. We are trying to leverage technology, cross border cooperation and social networks to compete.

We believe social networks and transparency can defeat organized crime. If we can bring together large numbers of motivated people to exchange information and force illicit networks into the open, criminality can’t survive long in the acid hot glare of the world spotlight.

We are cooperating with activist hackers such as Dan O'Huiginn, a Scottish programmer who scraped the Panamanian registry of companies website. This registry, although open, only allowed searches if the investigative reporter knew the name of the commercial company he or she was looking for. Users could not search by the names of persons in order to track down their assets. The programmer extracted the data and created a new web site where names-based searches are also possible. The new web site has led to almost a dozen investigative stories as government officials and members of parliament have surfaced as the owners of Panamanian companies including the family of the Azerbaijani president.

Such tools can and should be used not only by investigative journalist but also by any concerned citizens. It's very important that other professions like lawyers, scientists, and librarians get involved in this global effort.

The next phase of the dashboard is to build a tool that will help to crowd source professionals who can help. Imagine a librarian at Stanford University’s Graduate School of Business helpig a journalist or activist in Mbuji Mayi, a mining town in the Democratic Republic of the Congo by backgrounding a mining company. The librarian can, in a matter of minutes, identify who are the main shareholders and executives of the company. They may find out it is an honest company with a good track record or they may find out the company is crooked with a history of abusing locals, damaging the environment or not paying local taxes. Either way, this information would be very valuable to the people of Mbuji Mayi.

Thumbnail Photo courtesy of Shutterstock

• [Jim Saul]

  Please update when you get to the crowdsourcing stage… I bet many reading here have applicable skills, and forcing  this kind of sunlight onto oligarchs everywhere would have a huge impact on the direction our world is heading. It sounds like a fantastic project. I’d love to see what you find out about the recent hijinks at the Vatican bank.

  Some time down the road as the project develops, hopefully, into a “hoover’s” of corruption, maybe there’s a more direct use we could all make of the data.  I’d love to see it front-ended as an app that can scan a bar code at the store and tell me whether the supply chain of the product contains any entities tagged as Corporate Psychopaths by the research collective.

  Kind of like “blood diamonds”, it would be nice to know whether or not I’m buying blood coffee, blood bananas, blood yogurt, and blood granola for breakfast.

• [wysinwyg]

  Very cool stuff.   Thanks Paul Radu and Boing Boing for letting me know about it.

• [Ultan]

  While these programs may do some good in following dictators’ and corrupt officials hidden funds, for the most part the anti-money laundering laws are used as an instrument of repression against small enterprises, some of whom have done nothing wrong other than to try to keep their privacy and avoid onerous and unnecessary paperwork. Meanwhile the big banks and other cronies of the Treasury Secretary get exemptions.

  The threshold required to file a currency transaction report has been constant since CTRs were first introduced in 1970. Back then, $10,000 was equivalent to nearly $60,000 today. Additional requirements made it illegal to “structure” transactions by depositing smaller amounts over time if one had the cash to deposit more all at once. This was further enlarged by requiring banks to file reports on a vague range of other transactions that might not meet the already vague definition of structuring. Money laundering laws- along with wire fraud and conspiracy – have become a hammer that any federal prosecutor can use to destroy virtually anyone at any time. These laws are instruments of tyranny far more often than they are traps for tyrants.

  One case I just heard about today comes just 15 minutes from where I used to live, just around the corner from one of Maryland’s most senior federal prosecutors.
  

  U.S. Attorney for the District of Maryland Rod Rosenstein accused Randy and Karen Sowers, who own South Mountain Creamery on Bolivar Road in Middletown, of violating federal currency reporting requirements — known as structuring — by depositing money in increments of less than $10,000 so they would not have to fill out forms required under the Bank Secrecy Act.

  The couple deposited more than $295,000 into a PNC Bank account in about 36 separate transactions of just under $10,000 each from May 6, 2011, though Feb. 27, 2012, Rosenstein said. During that time, the couple’s cash receipts from farmers markets, including two in Baltimore, totaled more than $320,000, the complaint said.
  [....]
  Both Randy and Karen Sowers said Thursday that they have done nothing wrong and had never heard of structuring until Treasury Department officials showed up at their farm Feb. 29 to question them about deposits.

  On that day, they received a summons to testify before a Baltimore grand jury on April 3, according to documents provided by the couple and viewed by The Frederick-News-Post.

  About 45 minutes into that Feb. 29 questioning they learned the account, which had about $70,000 in it at the time, had been seized, they said. The couple then received a warrant about the seizure.

  “I said, ‘Huh?’” Randy Sowers said. “They said, ‘Yeah, we seized it.’”

  While he feared going public would hurt his case, Sowers said he hoped the attention might create some understanding of the couple’s plight.

  “The level we deposited was what it was and it was about the same every week,” Randy Sowers said.

  The money the couple deposited into the account was income from their sales at farmers markets and was to be spent on their farming business, he said.

  “This time of the year is always tough because you’re buying seed and everything else,” Randy Sowers said.

  From:
  http://www.fredericknewspost.com/sections/news/display.htm?StoryID=134695