How can Internet giants know that innocent-seeming US shell companies aren’t actually vehicles for malicious foreign actors to buy ads to interfere with elections? The short answer is they can’t, and that drew questioning from a congressional probe today into Facebook, Twitter, and Google.
One member of the committee questioning the companies’ spokespeople asked:
“How do you deal with the problem of a legitimate and lawful but phony American shell corporation, one that calls itself say “America For Puppies And Prosperity”, that has a drop box as its address, and a $50 million check in its check book that it’s using to spend to manipulate election outcomes”.
Twitter’s general counsel Sean Edgett admitted “I think that’s a problem. We’re continuing to look into ‘how do you get to know your client . . .and believe that we’ll have to figure out a good process to understand who those customers actually are that are signing the contracts with Twitter to run ads.”
The committee pressed further about Twitter’s shortcoming here. “You admit that if you trace it all the way back to an American corporation, let’s call it America for Puppies And Prosperity” and it’s actually a shell corporation, you don’t actually now who’s behind it?” the committee asked. “It could be Vladimir Putin, it could be big powerful American special interest, it could be the North Koreans or the Iranians. You ned to be able to penetrate the obscurity of the shell corporation, correct?”
Edgett responded “Yeah, we’re working on the best approach to getting to know the clients and getting to know who’s behind the entities that are signing up for advertising.”
Later, Facebook’s general counsel Colin Stretch was reamed by Senator John Kennedy for having 5 million advertisers, which a member of the commitee thought would be impossible to police. “”You don’t have the ability to know who every one of those advertisers is, do you?” Kennedy asked. Stretch admitted Facebook didn’t, and it would likely be cost-prohibitive to drill down further into their identities.
Herein lies one of the toughest on-going challenges for Twitter, Facebook, and Google. They must either erect barriers to advertising that could deter innocent businesses and cost too much to administer and maintain, or they have to largely take advertisers at face value.
Facebook has written that it plans to “require more thorough documentation from advertisers who want to run US federal election-related ads. Potential advertisers will have to confirm the business or organization they represent before they can buy ads.” But if those identified businesses are merely shell companies, that rule doesn’t do much good.
This issue of advertiser identity and how deep tech platforms are required to investigate it could emerge as key to whether these companies are allowed to self-regulate or whether the government will step in.
Featured Image: Bryce Durbin/TechCrunch