Worthwhile Reading: How Libel Firms Are Implicitly Enabling Illicit Schemes Via SLAPP Attacks!

Binder Groesswang represents SLAPP attack for Mercuryo
Spread financial intelligence

A remarkable analysis published by the Bureau of Investigative Journalism (TBIJ) on the UK law firm Carter-Ruck, renowned as Britain’s fiercest libel firm, sheds light on the profound impact of libel laws and practices on democratic values. In recent years, FinTelegram has had several experiences with law firms that represent scammers or shoddy schemes without moral or legal scruples and try to help them by preventing criticism through SLAPP actions.

SLAPP Attacking: The OneCoin Case

critical report about the British law firm Carter-Ruck

The detailed TBIJ report explains how UK Law Firm Carter-Ruck (website) suppressed critical reporting on the gigantic crypto scam scheme OneCoin a few years ago. Direct action was also taken against OneCoin members who wanted to pass on their experiences before it finally collapsed in 2018. This public critical feedback was suppressed by threatening legal actions intended to censor, intimidate, and silence critics by burdening them with the cost of a legal defense until they abandon their criticism. These are called Strategic lawsuits against public participation (SLAPP).

In the OneCoin case (and many others), this approach probably produced tens of thousands of new victims. It is now known that OneCoin was a fraudulent scheme founded by Bulgaria’s Ruja Ignatova, then known as the Crypto Queen, which has claimed tens of thousands, perhaps even hundreds of thousands of victims. In the U.S., several leading members have since been sentenced to several years in prison. Ignatova vanished in 2018, is still on the run, and is on the “most wanted list” of the U.S. FBI.

Bulgarian crypto queen Ruja Ignatova added to FBI most wanted list

Co-founder and brother of Ruja Ignatova, Konstantin Ignatov, pleaded guilty to fraud charges. Co-founder Sebastian Greenwood was sentenced to 20 years in prison. The former compliance chief, Irina Dilkinska, pleaded guilty and could face up to 10 years in prison. The U.S. prosecutors are talking about damages of at least $4 billion at OneCoin. FinTelegram assumes ten times that amount.

If OneCoin’s lawyers had prevented the critical public feedback from OneCoin members (now victims) that began in 2016, OneCoin would have been shut down sooner. In this respect, it is fair to say that the lawyers involved can be seen ex-post as cybercrime enablers. Should they have recognized this at the time? We think, yes! But who knows?

The Key Takeaways

  1. High Costs and Intimidation Tactics: The expense of British libel cases, often reaching into the millions, coupled with intimidating legal letters, can discourage individuals and organizations from speaking out, even in cases where they have valid points. This creates a chilling effect on free speech, crucial in a democratic society​​.
  2. Target Expansion Beyond Journalists: Carter-Ruck and similar firms have broadened their targets to include not just journalists but also bloggers, social media users, whistleblowers, and even government regulators. This expansion further endangers the ability of various societal actors to critique and hold powerful entities accountable​​.
  3. Legal Evolution and Impact on Public Scrutiny: The development of Britain’s libel industry, largely driven by firms like Carter-Ruck, has made it increasingly challenging to subject the wealthy and powerful to legitimate scrutiny. Attempts to reform these practices have often fallen short, leaving key problems like the imbalance of power and technical advantages to claimants unaddressed​​.
  4. International Reach and Libel Tourism: Carter-Ruck‘s global influence, leveraging the UK’s libel laws, means that even those outside Britain can find themselves subject to its jurisdiction. This global reach has significant implications for international journalism and public criticism​​.
  5. Historical Context and Firm’s Growth: Carter-Ruck‘s transformation of libel into a lucrative industry and its subsequent growth parallel the rise of the City of London as a financial hub. The firm’s history of aggressively pursuing libel cases has set a precedent that impacts current practices​​.
  6. Complexity in Ethical Implications: While Carter-Ruck has been effective in defending against tabloid abuse, some of its actions have raised ethical concerns, especially in cases where it has aggressively pursued individuals or organizations exercising their right to free speech​​.
  7. Carter-Ruck’s Response to Criticisms: In response to criticisms, Carter-Ruck maintains that it adheres to high standards in its conduct and dealings, asserting that its actions are within legal bounds and aimed at robustly defending its clients’ rights​​.

In the context of a democratic society in a cyber environment, the power and practices of firms like Carter-Ruck highlight a crucial tension between protecting reputations and preserving the fundamental right to free speech. It is essential for democratic societies to find a balance that protects individuals from defamation while also ensuring that public criticism and investigative journalism are not stifled by the threat of legal action. The case of Carter-Ruck exemplifies the need for ongoing scrutiny and potential reform of libel laws to safeguard these democratic principles.

Share Information

If you have information about law firms engaging in illegal or shady schemes, please let us know via our whistleblowing system, Whistle42.

Leave a Reply

Your email address will not be published. Required fields are marked *