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What Is Fake News And How Does It Reverberate Through Some Of Our Largest, Supposedly Scrupulous Legal Institutions?

Posted by: Gherson White-Collar Crime

We are all in a war against fake news.

Before the term “fake news” was injected into our political discourse, the Soviet Union regularly utilised what is known as “kompromat”. Unpacking the history of “kompromat” is instructive in understanding the dangers of “fake news. “Kompromat” remains in use in Russia and most of Eastern Europe to this day.

“Kompromat” is when deliberate misinformation (i.e. information which is incorrect and/or inaccurate) is placed in the media by individuals for a variety of reasons, from targeting business competition to attacking political opponents.

The material promulgated can be real or fake but the content of the story is a smokescreen, designed to distract the reader away from the intentions of the article. Only once the intention of the article is understood can the story be properly understood and scrutinised. 

“Kompromat” typically first appears in “peripheral” media outlets, often without citation. The content published by such “peripheral” outlets will be picked up by slightly more reliable newspapers, who will cite the outlets as their source. This process quickly snowballs and before you know it, reliable, mainstream news outlets hop onto the story, giving it a far wider exposure. As these more mainstream outlets seldom wish to lose out on an attention-grabbing headline, they do not stop to properly dig into the initial source. Given the time and expense that properly investigating the original source would entail (i.e. responsible journalism), such checks are overlooked, given that delays occasioned by attempts at verification of the information would only set them back amongst their peers. 

“Fake news” is the Western equivalent and interpretation of “kompromat”. Much like Soviet technology made it to space first but Apollo 11 conquered the moon, fake news has streamlined the tech of “kompromat”. “Fake News” has kept all the strengths of “kompromat” and ditched much of its weaknesses. “Fake news” is rarely, if ever, grounded in no truth. Instead, it takes enough truth to qualify for “validity” but then throws in a host of other conjured up, politically motivated falsities.

It is the civic duty of our major national and international legal and media institutions to understand this truth: motivation is as important as content in any given media article in today’s polarised, political, fake-news-prone world. Why invest in your product and hope you can out-do your competition when you can just conjure up a few carefully crafted media articles with the help of professional “fake news” firms and destroy the career of your greatest business enemy? Ten articles which carry a few truths and a host of damning lies can scare away any bank or financial institution when doing their KYC. 

It is therefore the job of our legal institutions to be ahead of the curve on this front, to fight harder for our principles of “innocent until proven guilty”, taking a broader understanding of guilt when it is portrayed through perfectly timed, perfectly crafted and perfectly harmful media attacks on businesspeople or politicians. These media companies (which often sell their “research” to major financial institutions in private) claim to be search agencies – yet they selectively choose media and portray it in the way they want to. When those they defame attempt to achieve legal redress, they hide behind GDPR. 

We are all in a war against fake news. Defamation suits only spill false stories into the public eye more and muddy the waters of what the objective truth really is. Legal institutions accept media from certain publishers as the unequivocal gold standard and this creates issues for the reasons given above.

There are cases of incorrect and/or inaccurate information relating to individuals being placed on influential databases because of the promulgation of “kompromat” or “fake news”. In these circumstances, the databases in question failed to dig properly into their own KYC, and relied on fake news stories perpetuating incorrect and/or inaccurate information and making demonstrably false allegations. These databases have a duty to act in compliance with GDPR, yet by processing incorrect and/or inaccurate information they not only fan the flames by adding legitimacy to “fake news” but are also in clear breach of these duties. Indeed these databases are often a trusted and influential provider of KYC information for financial institutions worldwide. The effects and consequences of processing inaccurate and/or incorrect information are not insignificant, and can indeed be devastating for an individual trying to do business in a global market.

Gherson has an understanding of the impact the processing of incorrect and/or inaccurate information can have on an individual’s reputation and business interests.  Furthermore, we have specialist knowledge and experience in challenging worldwide KYC firms who process incorrect and/or inaccurate information relating to individuals and successfully having such incorrect and/or inaccurate information removed.

The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please don’t hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.

©Gherson 2021


Thomas Cattee 

  Thomas Cattee

  Solicitor in our White Collar Crime Defence Team


Alfred Gherson 

  Alfred Gherson

  Trainee Solicitor in our Complex Litigation Team


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