Wall Street Journal: How WikiLeaks Keeps Its Funding Secret

| | Comments (3)

We ave previously commented that WkiLeakS.org, or similar organisations, actually require the same sort off "tax haven" and "tax avoidance" techniques employed by the Private Banking industry which they so gleefully try to expose the details of "for maximum political effect".

The Wall Street Journal has been "investigating", without actually revealing the details of any of the front companies and foundations, apart from some of the ones which have appeared on the WikiLeakS.org financial contributions pages. It is is disappointing that a financial sector newspaper like the Wall Street Journal, cannot find, or will not publish, any more details, other than those provided by Julian Assange.

Have these been verified in any way e.g. is WikiLeakS.org really registered as a library in Australia ?

How WikiLeaks Keeps Its Funding Secret

By JEANNE WHALEN and DAVID CRAWFORD

The controversial website WikiLeaks, which argues the cause of openness in leaking classified or confidential documents, has set up an elaborate global financial network to protect a big secret of its own--its funding.

Some governments and corporations angered by the site's publications have already sued WikiLeaks or blocked access to it, and the group fears that its money and infrastructure could be targeted further, founder Julian Assange said in an interview in London shortly after publishing 76,000 classified U.S. documents about the war in Afghanistan in July. The move sparked international controversy and put WikiLeaks in the spotlight.

In response, the site has established a complex system for collecting and disbursing its donations to obscure their origin and use, Mr. Assange said. Anchoring the system is a foundation in Germany established in memory of a computer hacker who died in 2001.

WikiLeaks's financial stability has waxed and waned during its short history. The site shut down briefly late last year, citing a lack of funds, but Mr. Assange said the group has raised about $1 million since the start of 2010.

WikiLeaks's lack of financial transparency stands in contrast to the total transparency it seeks from governments and corporations.

This lack of financial transparency is one of the major failings of the WikiLeakS.org project.

"It's very hard work to run an organization, let alone one that's constantly being spied upon and sued," Mr. Assange said in the The controversial website WikiLeaks, which argues the cause of openness in leaking classified or confidential documents, has set up an elaborate global financial network to protect a big secret of its own--its funding.

Some governments and corporations angered by the site's publications have already sued WikiLeaks or blocked access to it, and the group fears that its money and infrastructure could be targeted further, founder Julian Assange said in an interview in London shortly after publishing 76,000 classified U.S. documents about the war in Afghanistan in July. The move sparked international controversy and put WikiLeaks in the spotlight.

In response, the site has established a complex system for collecting and disbursing its donations to obscure their origin and use, Mr. Assange said. Anchoring the system is a foundation in Germany established in memory of a computer hacker who died in 2001.

WikiLeaks's financial stability has waxed and waned during its short history. The site shut down briefly late last year, citing a lack of funds, but Mr. Assange said the group has raised about $1 million since the start of 2010.

WikiLeaks's lack of financial transparency stands in contrast to the total transparency it seeks from governments and corporations.

"It's very hard work to run an organization, let alone one that's constantly being spied upon and sued," Mr. Assange said in the interview. "Judicial decisions can have an effect on an organization's operation. ... We can't have our cash flow constrained entirely," he said.

Among the cases WikiLeaks has faced, the Swiss bank Julius Baer & Co. in 2008 sued for damages in federal court in California, alleging that the site had published stolen bank documents. The court ordered the disabling of the wikileaks.org domain name, but the bank withdrew its lawsuit after civil-rights advocates protested.

Though Mr. Assange declined to name donors or certain companies through which donations flow, he provided some insight into the funding structure that allows the group to operate.

The linchpin of WikiLeaks's financial network is Germany's Wau Holland Foundation. WikiLeaks encourages donors to contribute to its account at the foundation, which under German law can't publicly disclose the names of donors. Because the foundation "is not an operational concern, it can't be sued for doing anything. So the donors' money is protected, in other words, from lawsuits," Mr. Assange said.

Nonsense ! There are several Islamic Charities which not only have been sued, but have subjected to anti-terrorism investigations and have had their financial assets frozen, even though they have never been "operational concerns" either.

No "tax evasion" / "tax avoidance" trust funds and front companies registered in tax havens are "operational concerns" either, but that does not prevent various tax authorities going after them and their beneficiaries.

The German foundation is only one piece of the WikiLeaks network.

"We're registered as a library in Australia, we're registered as a foundation in France, we're registered as a newspaper in Sweden," Mr. Assange said. WikiLeaks has two tax-exempt charitable organizations in the U.S., known as 501C3s, that "act as a front" for the website, he said. He declined to give their names, saying they could "lose some of their grant money because of political sensitivities."

Surely the Wall Street Journal could investigate and find out the names of the Australian "library", the French foundation and the US 501C3s ?

Mr. Assange said WikiLeaks gets about half its money from modest donations processed by its website, and the other half from "personal contacts," including "people with some millions who approach us and say 'I'll give you 60,000 or 10,000,' " he said, without specifying a currency.

How have WikiLeakS.org solved the problem faced by many unincorporated voluntary organisations, who cannot get large sums of money from rich individuals or companies or trades unions etc. because these donors would become "jointly and separately liable" for any debts incurred by the voluntary organisations , and, just as importantly, vice versa i.e. the organisation could become liable for the debts or bankruptcy of these large donors.

The other big risks to rich financial donors involve the horrendously complicated and ineffective (in terms of catching real criminals and terrorists) anti-money laundering regulations and investigations, which various government bureaucracies have imposed on the financial industry, especially for foreign money transfers.

How does WikiLeakS.org provide any protection to financial donors in such cases ?

Retrieving money from the Wau Holland Foundation is a complicated task, he said. WikiLeaks must submit receipts to the foundation, which issues grants to reimburse them. Because German law requires the foundation to publicly disclose its expenditures, WikiLeaks uses "other foundations" to aggregate its bills and send them to Wau Holland, so that some of the companies WikiLeaks does business with remain anonymous, Mr. Assange said. This prevents anyone from seeing whom, for example, WikiLeaks pays for Internet infrastructure, or where that infrastructure is located.

To operate, the website needs several powerful computers linked to high-speed Internet connections. WikiLeaks particularly tries to obscure payments for "basic infrastructure that could be attacked," for "servers that are engaged in source protection," and for "security engineers," Mr. Assange said.

So far, Wau Holland has distributed €50,000 ($64,000) to a WikiLeaks account in Germany, strictly in exchange for receipts, according to Daniel Schmitt, spokesman at WikiLeaks, and Hendrik Fulda, deputy board chairman of the foundation. Mr. Schmitt controls the account.

The average donation to WikiLeaks via the Wau Holland Foundation is about €20, Mr. Fulda said. The largest donation through the foundation--€10,000--arrived from a German donor after the publication of the Afghan war documents, he said, declining to reveal further details.

Mr. Schmitt said WikiLeaks needs about $200,000 a year to cover its operating expenses--mainly network fees, rent and storage costs for the sites where the servers are, and some hardware and travel expenses. Should it decide to pay salaries to its five staff members, as it is now considering, it would need about €600,000 a year, he said.

Paying salaries is a "sensitive subject," he said, noting that outsiders might question the need for them.

Most of the financial supporters of WikiLeakS.org would not object to salary payments for key staff, but they do demand some sort of financial accounting and transparency, which is totally lacking at the moment.

Mr. Fulda of the foundation said WikiLeaks needs €10,000 to €15,000 a month to maintain its Web presence. Late last year, when donors were contributing only €2,000 to €3,000 per month, WikiLeaks was struggling to survive, he said. So it shut down its website in December, leaving up only an appeal for donors to transfer money to the group via the Wau Holland Foundation. Soon, donations per month increased 20-fold.

WikiLeaks reopened its website in May, but "within days ... donations dropped back to near their former level," Mr. Fulda said.

The fluctuation caught the attention of Wau Holland's banking partners including eBayInc.'s PayPal, which demanded explanations for the surge and fall in donations. "I explained it wasn't money laundering, just WikiLeaks donations," Mr. Fulda said.

Which shows how useless the anti-money laundering red tape is.

A PayPal spokeswoman said the company is "still processing payments for WikiLeaks." She said that she couldn't comment further on a specific account but that in general, PayPal is required by anti-money-laundering laws and its own anti-fraud regulations to investigate accounts when they exceed certain limits.

WikiLeaks has tried to diversify away from PayPal by adding other payment options to its site, including Flattr.com, a payment system based in Sweden, and Moneybookers, a system based in the U.K.

A spokeswoman for Moneybookers said the company used to provide services to WikiLeaks but "as they don't adhere to Moneybookers' standards, the agreement was terminated." She declined to comment further. Flattr didn't respond to a request for comment.

"as they don't adhere to Moneybookers' standards, the agreement was terminated" - points to WikiLeakS.org lack of financial transparency as being a major problem.

Note also that another online money payment system which WikiLeakS.org has used during their dispute with PayPal, called TipIt.to seems to have gone "tits up" at the end of February 2010 due to "fraudulent transactions"

http://blog.tipit.to/2010/04/gesloten-voor-preventie-%E2%80%94%C2%A0closed-for-prevention/

Write to Jeanne Whalen at jeanne.whalen@wsj.com and David Crawford at david.crawford@wsj.com

3 Comments

"Surely the Wall Street Journal could investigate and find out the names of the Australian "library", the French foundation and the US 501C3s ?"

Why do YOU care? It seems that there are fairly obvious reasons to keep the financial sources secret. Do you desire the US authorities to shut it down?

"...because these donors would become "jointly and separately liable" for any debts incurred by the voluntary organisations , and, just as importantly, vice versa i.e. the organisation could become liable for the debts or bankruptcy of these large donors."

This needs more explanation. As far as I can tell this is a bazaar hypothetical issue.

@ AMeshiea - WikiLeakS.org has offered no financial transparency whatsoever. Many individual people who otherwise might have supported it financially, simply will not do so.

"Surely the Wall Street Journal could investigate and find out the names of the Australian "library", the French foundation and the US 501C3s ?"

Why do YOU care? It seems that there are fairly obvious reasons to keep the financial sources secret. Do you desire the US authorities to shut it down?

There are no obvious reasons at all - WikiLeaks.org has acted perfectly legally under various free speech laws, so there is no reason why their sources of finance should remain unaudited.

The real identities of individual financial contributors is a different issue, but remember WikILeakS.org has already betrayed some of the identities of its financial donors in the past.

See the previous blog posting:

Follow the money - WikiLeakS.org partial financial donors list email

The comment was bemoaning the shallowness of the alleged investigative journalism by a supposed world leading financial journalism publication with global resources.

Without a bare minimum of independently audited financial transparency, it is actually far more likely that various branches of various Governments will attempt to shut down WikiLeakS.org, not because of any secrets or whistleblower leaks, but because they are acting indistinguishably from criminal fraudsters.

Are you rich enough to risk giving your money to criminal fraudsters without any qualms ?

If you think that not making public the names of WikiLeakS.org's supposed tax exempt or charitable financial front organisations will somehow protect them from the US or any other government, then you are deluding yourself.

It is entirely possible that there simply are no such organisations, only vague aspirations and media hype claiming that they intend to sign up for them.

If any government agency instigated any criminal investigations into WikiLeakS.org finances, they would easily discover the public names of the non-profit or tax exempt institutions which the Wall Street Journal failed to bother to to try to look up and collate for its readers.

"...because these donors would become "jointly and separately liable" for any debts incurred by the voluntary organisations , and, just as importantly, vice versa i.e. the organisation could become liable for the debts or bankruptcy of these large donors."

This needs more explanation. As far as I can tell this is a bazaar hypothetical issue.

There is nothing bizarre or hypothetical about this, it is the main reason that Companies and Corporations are formed.

Talk to anybody involved in the finances of non-governmental or voluntary or campaign organisations and you will see why, as their income rises from more than trivial donations, the issue of being held financially liable for every other supporter or financial donor's debts is a big risk, which is usually solved by setting up a Not for Profit Company Limited By Guarantee or, if there is a lot of money available for administrative red tape rather than campaigning, a Charity.

WikiLeakS.org obviously know this, which is why they have mentioned various tax exempt or charitable organisations in different legal jurisdictions.

Releasing stolen information is not only wrong, it is immature and foolish.

Leave a comment

About this blog

This blog here at WikiLeak.org (no "S") discusses the ethical and technical issues raised by the WikiLeakS.org project, which is trying to be a resource for whistleblower leaks, by providing "untraceable mass document leaking and analysis".

These are bold and controversial aims and claims, with both pros and cons, especially for something which crosses international boundaries and legal jurisdictions.

This blog is not part of the WikiLeakS.org project, and there really are no copies of leaked documents or files being mirrored here.

Email Contact

Please feel free to email us your views about this website or news about the issues it tries to comment on:

email: blog@WikiLeak[dot]org

Before you send an email to this address, remember that this blog is independent of the WikiLeakS.org project.

If you have confidential information that you want to share with us, please make use of our PGP public encryption key or an email account based overseas e.g. Hushmail

LeakDirectory.org

Now that the WikiLeakS.org project is defunct, so far as new whistleblower are concerned, what are the alternatives ?

The LeakDirectory.org wiki page lists links and anonymity analyses of some of the many post-wikileaks projects.

There are also links to better funded "official" whistlblowing crime or national security reporting tip off websites or mainstream media websites. These should, in theory, be even better at protecting the anonymity and security of their informants, than wikileaks, but that is not always so.

New whistleblower website operators or new potential whistleblowers should carefully evaluate the best techniques (or common mistakes) from around the world and make their personal risk assessments accordingly.

Hints and Tips for Whistleblowers and Political Dissidents

The WikiLeakS.org Submissions web page provides some methods for sending them leaked documents, with varying degrees of anonymity and security. Anybody planning to do this for real, should also read some of the other guides and advice to political activists and dissidents:

Please take the appropriate precautions if you are planning to blow the whistle on shadowy and powerful people in Government or commerce, and their dubious policies. The mainstream media and bloggers also need to take simple precautions to help preserve the anonymity of their sources e.g. see Spy Blog's Hints and Tips for Whistleblowers - or use this easier to remember link: http://ht4w.co.uk

BlogSafer - wiki with multilingual guides to anonymous blogging

Digital Security & Privacy for Human Rights Defenders manual, by Irish NGO Frontline Defenders.

Everyone’s Guide to By-Passing Internet Censorship for Citizens Worldwide (.pdf - 31 pages), by the Citizenlab at the University of Toronto.

Handbook for Bloggers and Cyber-Dissidents - March 2008 version - (2.2 Mb - 80 pages .pdf) by Reporters Without Borders

Reporters Guide to Covering the Beijing Olympics by Human Rights Watch.

A Practical Security Handbook for Activists and Campaigns (v 2.6) (.doc - 62 pages), by experienced UK direct action political activists

Anonymous Blogging with Wordpress & Tor - useful step by step guide with software configuration screenshots by Ethan Zuckerman at Global Voices Advocacy. (updated March 10th 2009 with the latest Tor / Vidalia bundle details)

WikiLeakS Links

The WikiLeakS.org Frequently Asked Questions (FAQ) page.

WikiLeakS Twitter feeds

The WikiLeakS.org website does not stay online all of the time, especially when there is a surge of traffic caused by mainstream media coverage of a particularly newsworthy leak.

Recently, they have been using their new Twitter feeds, to selectively publicise leaked documents to the media, and also to report on the status of routing or traffic congestion problems affecting the main website in Stockholm, Sweden.

N.B.the words "security" or "anonymity" and "Twitter" are mutually exclusive:

WikiLeakS.org Twitter feed via SSL encrypted session: https://twitter.com/wikileaks

WikiLeakS.org unencrypted Twitter feed http://twitter.com/wikileaks

Internet Censorship

OpenNet Initiative - researches and measures the extent of actual state level censorship of the internet. Features a blocked web URL checker and censorship map.

Temporary Autonomous Zone

Temporary Autonomous Zones (TAZ) by Hakim Bey (Peter Lambourn Wilson)

Cyberpunk author William Gibson

Campaign Button Links

Watching Them, Watching Us, UK Public CCTV Surveillance Regulation Campaign
UK Public CCTV Surveillance Regulation Campaign

NO2ID Campaign - cross party opposition to the NuLabour Compulsory Biometric ID Card
NO2ID Campaign - cross party opposition to the NuLabour Compulsory Biometric ID Card and National Identity Register centralised database.

Gary McKinnon is facing extradition to the USA under the controversial Extradition Act 2003, without any prima facie evidence or charges brought against him in a UK court. Try him here in the UK, under UK law.
Gary McKinnon is facing extradition to the USA under the controversial Extradition Act 2003, without any prima facie evidence or charges brought against him in a UK court. Try him here in the UK, under UK law.

FreeFarid_150.jpg
FreeFarid.com - Kafkaesque extradition of Farid Hilali under the European Arrest Warrant to Spain

Peaceful resistance to the curtailment of our rights to Free Assembly and Free Speech in the SOCPA Designated Area around Parliament Square and beyond

Parliament Protest blog - resistance to the Designated Area restricting peaceful demonstrations or lobbying in the vicinity of Parliament.

Petition to the European Commission and European Parliament against their vague Data Retention plans
Data Retention is No Solution Petition to the European Commission and European Parliament against their vague Data Retention plans.

Save Parliament: Legislative and Regulatory Reform Bill (and other issues)
Save Parliament - Legislative and Regulatory Reform Bill (and other issues)

Open_Rights_Group.png
Open Rights Group

The Big Opt Out Campaign - opt out of having your NHS Care Record medical records and personal details stored insecurely on a massive national centralised database.

Tor - the onion routing network
Tor - the onion routing network - "Tor aims to defend against traffic analysis, a form of network surveillance that threatens personal anonymity and privacy, confidential business activities and relationships, and state security. Communications are bounced around a distributed network of servers called onion routers, protecting you from websites that build profiles of your interests, local eavesdroppers that read your data or learn what sites you visit, and even the onion routers themselves."

Tor - the onion routing network
Anonymous Blogging with Wordpress and Tor - useful Guide published by Global Voices Advocacy with step by step software configuration screenshots (updated March 10th 2009).

irrepressible_banner_03.gif
Amnesty International's irrepressible.info campaign

anoniblog_150.png
BlogSafer - wiki with multilingual guides to anonymous blogging

ngoiab_150.png
NGO in a box - Security Edition privacy and security software tools

homeofficewatch_150.jpg
Home Office Watch blog, "a single repository of all the shambolic errors and mistakes made by the British Home Office compiled from Parliamentary Questions, news reports, and tip-offs by the Liberal Democrat Home Affairs team."

rsf_logo_150.gif
Reporters Without Borders - Reporters Sans Frontières - campaign for journalists 'and bloggers' freedom in repressive countries and war zones.

committee_to_protect_bloggers_150.gif
Committee to Protect Bloggers - "devoted to the protection of bloggers worldwide with a focus on highlighting the plight of bloggers threatened and imprisoned by their government."

wikileaks_logo_low.jpg
Wikileaks.org - the controversial "uncensorable, anonymous whistleblowing" website based currently in Sweden.

Syndicate this site (XML):

Recent Comments

  • Daniel Beckstedt: Releasing stolen information is not only wrong, it is immature read more
  • wikileak: @ AMeshiea - WikiLeakS.org has offered no financial transparency whatsoever. read more
  • AMeshiea: "Surely the Wall Street Journal could investigate and find out read more

July 2011

Sun Mon Tue Wed Thu Fri Sat
          1 2
3 4 5 6 7 8 9
10 11 12 13 14 15 16
17 18 19 20 21 22 23
24 25 26 27 28 29 30
31