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Wednesday, April 10, 2013

How 86 Journalists in 46 Countries Worked Together to Expose Tax Shelters of Politicians, Fundraisers. and Celebrities from Over 170 Countries

This is amazingly cool - I look forward to reading what this data mining reveals about the insane amount of money hidden in off-shore, untaxed accounts.

This excellent summary of the work that went into exposing this information comes from the Neiman Journalism Lab at Harvard University.


Intercontinental collaboration: How 86 journalists in 46 countries can work on a single investigation


Over 2.5 million files analyzed by a global team of journalists reveal financial information about politicians, fundraisers. and celebrities from over 170 different countries.

By Caroline O’Donovan

On Thursday morning, the International Consortium of Investigative Journalists— a project of the Center for Public Integrity — will begin releasing detailed reports on the workings of offshore tax havens. A little over a year ago, 260 gigabytes of data were leaked to ICIJ executive dIrector Gerard Ryle; they contained information about the finances of individuals in over 170 countries.

Ryle was a media executive in Australia at the time he received the data, says deputy director Marina Walker Guevara. “He came with the story under his arm.” Walker Guevara says the ICIJ was surprised Ryle wanted a job in their small office in Washington, but soon realized that it was only through their international scope and experience with cross border reporting that the Offshore Project could be executed. The result is a major international collaboration that has to be one of the largest in journalism history.

“It was a huge step. As reporters and journalists, the first thing you think is not ‘Let me see how I can share this with the world.’ You think: ‘How can I scoop everyone else?’ The thinking here was different.” Walker Guevara says the ICIJ seriously considered keeping the team to a core five or six members, but ultimately decided to go with the “most risky” approach when they realized the enormous scope of the project: Journalists from around the world were given lists of names to identify and, if they found interesting connections, were given access to Interdata, the secure, searchable, online database built by the ICIJ.

Just as the rise of information technology has allowed new competition for the attention of audiences, it’s also enabled traditional news organizations to partner in what can sometimes seem like dizzyingly complex relationships. The ICIJ says this is the largest collaborative journalism project they have ever organized, with the most comparable involving a team of 25 cross border journalists.

In the end, the Offshore Project brings together 86 journalists from 46 countries into an ongoing reporting collaboration. German and Canadian news outlets (Süddeutsche Zeitung, Norddeutscher Rundfunk, and the CBC) will be among the first to report their findings this week, with The Washington Post beginning their report on April 7, just in time for Tax Day. Reporters from more than 30 other publications also contributed, including Le Monde, the BBC and The Guardian. (The ICIJ actually published some preliminary findings in conjunction with the U.K. publications as a teaser back in November.)

“The natural step wasn’t to sit in Washington and try to figure out who is this person and why this matters in Azerbaijan or Romania,” Walker Guevara said, “but to go to our members there — or a good reporter if we didn’t have a member — give them the names, invite them into the project, see if the name mattered, and involve them in the process.”

Defining names that matter was a learning experience for the leaders of the Offshore Project. Writes Duncan Campbell, an ICIJ founder and current data journalism manager:
ICIJ’s fundamental lesson from the Offshore Project data has been patience and perseverance. Many members started by feeding in lists of names of politicians, tycoons, suspected or convicted fraudsters and the like, hoping that bank accounts and scam plots would just pop out. It was a frustrating road to follow. The data was not like that.
The data was, in fact, very messy and unstructured. Between a bevy of spreadsheets, emails, PDFs without OCR, and pictures of passports, the ICIJ still hasn’t finished mining all the data from the raw files. Campbell details the complicated process of cleaning the data and sorting it into a searchable database. Using NUIX software licenses granted to the ICIJ for free, it took a British programmer two weeks to build a secure database that would allow all of the far-flung journalists not only to safely search and download the documents, but also to communicate with one another through an online forum.

“Once we went to these places and gathered these reporters, we needed to give them the tools to function as a team,” Walker Guevara said.

Even so, some were so overwhelmed by the amount of information available, and so unaccustomed to hunting for stories in a database, that the ICIJ ultimately hired a research manager to do searches for reporters and send them the documents via email. “We do have places like Pakistan where the reporters didn’t have much Internet access, so it was a hassle for him,” says Walker Guevara, adding that there were also security concerns. “We asked him to take precautions and all that, and he was nervous, so I understand.”

They also had to explain to each of the reporting teams that they weren’t simply on the lookout for politicians hiding money and people who had broken the law. “First, you try the name of your president. Then, your biggest politician, former presidents — everybody has to go through that,” Walker Guevara says. While a few headline names did eventually appear — Imelda Marcos, Robert Mugabe — she says some of the most surprising stories came from observing broader trends.

“Alongside many usual suspects, there were hundreds of thousands of regular people — doctors and dentists from the U.S.,” she says, “It made us understand a system that is a lot more used than what you think. It’s not just people breaking the law or politicians hiding money, but a lot of people who may feel insecure in their own countries. Or hiding money from their spouses. We’re actually writing some stories about divorce.”

In the 2 million records they accessed, ICIJ reporters began to get an understanding of the methods account holders use to avoid association with these accounts. Many use “nominee directors,” a process which Campbell says is similar to registering a car in the name of a stranger. But in their post about the Offshore Project, the ICIJ team acknowledges that, to a great extent, most of the money being channeled through offshore accounts and shell companies is actually not being used for illegal transactions. Defenders of the offshore banks say they “allow companies and individuals to diversify their investments, forge commercial alliances across national borders, and do business in entrepreneur-friendly zones that eschew the heavy rules and red tape of the onshore world.”

Walker Guevara says that, while that can be true, the “parallel set of rules” that governs the offshore world so disproportionately favor the elite, wealthy few as to be unethical. “Regulations, bureaucracy, and red tape are bothersome,” she says, “but that’s how democracy works.”

Perhaps the most interesting question surrounding the Offshore Project, however, is how do you get traditional shoe-leather journalists up to speed on an international story that involves intensive data crunching. Walker Guevara says it’s all about recognizing when the numbers cease to be interesting on their own and putting them in global context. Ultimately, while it’s rewarding to be able to trace dozens of shell companies to a man accused of stealing $5 billion from a Russian bank, someone has to be able to connect the dots.

“This is not a data story. It was based on a huge amount of data, but once you have the name and you look at your documents, you can’t just sit there and write a story,” says Walker Guevara. “That’s why we needed reporters on the ground. We needed people checking courthouse records. We needed people going and talking to experts in the field.”

All of the stories that result from the Offshore Project — some of which could take up to a year to be published — will live on a central project page at ICIJ.org. The team is also considering creating a web app that will allow users to explore some (though probably not all) of the data. In terms of the unique tools they built, Walker Guevara says most are easily replicable by anyone using NUIX or dtSearch software, but they won’t be open sourced. Other lessons from the project, like the inherent vulnerability of PGP encryption and “other complex cryptographic systems popular with computer hackers,” will endure.

“I think one of the most fascinating things about the project was that you couldn’t isolate yourself. It was a big temptation — the data was very addictive,” Walker Guevara says. “But the story worked because there was a whole other level of traditional reporting that was going and checking public records, going and seeing — going places.”

Photo by Aaron Shumaker used under a Creative Commons license.

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