The broligarchy's war on journalism

The capture of US media by Trump allies is accelerating and the UK is the next in line. Plus: the mystery money behind my old newspaper.

A note on who I am: I’m an investigative journalist who’s spent a decade reporting on the collision of technology and democracy including exposing the Facebook/Cambridge Analytica scandal for the Guardian and the New York Times. Two years ago, I called the alliance of Trump, Silicon Valley and a global axis of autocracy: a tech bro oligarchy, aka the Broligarchy. Please help me continue to expose it.

This week, the BBC announced the appointment of a new director general. An ex-Google middle manager called Matt Brittin who will lead the publicly-owned corporation at a time when its entire existence is under threat. The next years are crucial: Nigel Farage, whose far-right Reform party is surging in the polls, hasn’t disguised his Trumpian desire to smash it to pieces.

I’ve written about Brittin in the Nerve this week because I believe it’s a disastrous appointment for the BBC and therefore us all. It’s a choice rooted in our ongoing naivity about Silicon Valley technology firms including Google that’s still seen as a dynamic start-up not a rapacious AI company that’s actively trying to destroy journalism.

Google’s AI summaries now appear at the top of every search, they scrape journalists’ work while simultaneously tanking traffic to their websites. Since they were introduced, some websites have seen up to an 80% fall. And Brittin is your standard issue AI hype man.

Last year, he was appointed to the Guardian’s board to help the organisation navigate decisions about AI and the organisation promptly entered into a “strategic partnership” with one of the worst companies on the planet, OpenAI.

This is tech capture. It’s a playbook we’ve seen play out time and time again. And, as an ardent believer in the importance of independent media and the survival of both the Guardian and BBC, I think it’s a terrible, terrible error of judgment. Silicon Valley creates dependencies in media companies that gives them leverage to avoid negative coverage and crucially regulation including through a range of techniques that include blackmail and extortion. There’s chapter and verse in this very good report, this just one example:

In the US, the Washington Post has been hollowed out by one tech broligarch (Jeff Bezos) and CBS and TikTok have been captured by another (the Ellisons). CNN is the next in line. Larry Ellison’s son David is set to take control of Paramount which owns CNN and HBO among a welter of other media brands. CBS, which it already controls. already become a hollowed-out husk of a once vital US network. Oliver Darcy of Status also reported this week that viewers are turning off in droves. This is a media crisis wrapped inside a political crisis.

The UK’s media was pre-captured. Our print media is overwhelmingly oligarch owned. But the process is accelerating here also. The German company Axel Springer is buying the Telegraph in a £575m deal. It’s owned by another Trump ally, Mathias Döpfner who’s also close to Peter Thiel, the founder of Palantir. Thiel is actually in business with Döpfner’s son, Moritz, investing $50m into a fund he founded.

And this Sunday, my old newspaper, the Observer - which was an integral part of the Guardian until a year ago - published a story on Palantir that made my heart sink.

At the Nerve, we’ve investigated Palantir’s chokehold on the UK government, we’ve found Ministry of Defence whistleblowers who claim it’s a threat to national security, and revealed the UK pension funds who are fuelling its growth. I’ve written here about its role in what I believe is the US’s descent into technofascism. And of course, in this newsletter, Peter Thiel, one of the most dangerous men on the planet, is a regular character.

This is what alerted me to the Observer piece. Two glowing endorsements from…Palantir’s UK CEO, Louis Mosley.

Mosley is the grandson of Oswald Mosley who founded the British Union of Fascists, aka “Blackshirts”. The examples he cites were case studies that the Observer’s political editor had exclusively obtained. Mosley also granted her an exclusive interview. For comparison, Palantir did not respond to any of the press inquiries we sent it before our first investigation. The Observer piece is behind a paywall - as all its journalism now is - but there’s a text version here.

What’s noteworthy here is that Palantir is being covered by my old newspaper by the political editor as a political story. UK political reporting is largely a time-honoured game of favour trading that sees journalists use politicians to give up their gossip and politicians use journalists to channel their spin.

Certainly this is the game (and journalists) that Palantir’s press man in the UK knows: he previously worked at Number 10 Downing Street. I may be wrong and we can never know but I don’t believe the Observer of a year ago would have run this piece. Not because of me or my strongly held views on the threat Peter Thiel poses to democracy (his words, not mine: Thiel says democracy is “incompatible” with freedom) but because of normal editorial processes.

News organisations make mistakes. The Observer famously did when it backed the Iraq War. But channelling Palantir spin into a double-page spread without robustly interrogating the provenance of the story or the motivations behind it? A simple fact check would have revealed Mosley’s claims weren’t even true. The case study Palantir provided made the bold claim that Palantir had prevented all domestic murders in Bedfordshire last year.

“Usually 5 or 6 domestic murders a year,” Mosley tweeted quoting the article. “Last 12 months? Zero. By using Palantir, Bedfordshire Police identified 1,000+ women whose partners had a history of domestic abuse - and warned them they could be in danger.”

Er, no, as the journalist Iain Overton points out. He found at least two Bedfordshire women murdered in their homes last year. I also asked a solicitor who specialises in domestic abuse what she made of the piece:

The UK police have a persistent track record in failing to act on domestic abuse and threats of violence against women. And what Bedfordshire Police have done, with the assistance of the Observer, is to techwash these failures via Palantir’s press office.

All of which begs the question: why?

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A mystery investor

It’s nearly a year since the Guardian “transferred” the Observer to a group of private investors along with £5m. It did so after a bitter dispute with its journalists, 93% of whom voted to go on strike. I’ve written here about Tortoise Media, the company that acquired it, and here about the issues with the deal including the friendship between James Harding, Tortoise’s founder and the Guardian’s CEO, Anna Bateson, who cooked this deal up. And here, about the day we left the Guardian.

In a meeting, on the day the deal was done, we asked Anna Bateson for the names of Tortoise’s new incoming investors. She told us she would send a list after the meeting. That offer was rescinded. The Guardian said Tortoise Media had to supply the names. Tortoise Media declined to do so.

The new known investors include a major political donor to the Labour Party and the controversial thinktank, Labour Together, Gary Lubner, and the owner of Prospect magazine, Clive Cowdery.

But just before Christmas, Tortoise Media, now the owners of the Observer, published a new financial filing with the UK registry, Companies House, which finally listed the names of all shareholders. Most of them were already in the public domain, which made the secrecy all the more baffling. But one caught my eye: “The North Hatley Trust.”

The North Hatley Trust had been a seed investor in the company and in the latest round had bought a further 434,234 shares. That made it one of the Observer’s biggest investors. When I’d seen the name in the seed round I assumed that North Hatley Trust was…a trust, ie some sort of non-profit or family foundation. But when I looked more closely, I found it was just the name of an opaque financial vehicle. An opaque financial vehicle that is now one of the biggest shareholders in the world’s oldest Sunday newspaper.

The only information is a “Legal Entity Identifier” or LEI listing that reveals the barest of details and that’s it. The “Parent” information - ultimate beneficial owner - is not provided.

These sorts of financial vehicles can be set up for all sorts of perfectly legitimate reasons. But they’re also useful if you want to mask the true owners of a company or source of funds. They provide total anonymity.

They’re also commonly used by investment firms for cross-border transactions or to administer sub-funds. (North Hatley is a small town in Canada, to save you the Google.) And there’s just a few other tiny bits of information including that it was registered on Jan 20 last year:

And that its registered legal address and listed HQ is: Suite 5700, 415 Mission Street, San Francisco.

415 Mission Street is a pretty famous address in San Francisco. It’s home to the city’s landmark Salesforce Tower, a huge office building. But North Hatley Trust’s address is much more specific than that. It’s based in Suite 5700.

And that’s where it gets interesting. Because it turns out that 415 Mission Street, Suite 5700 is the headquarters of Hellman & Friedman, a US private equity firm.

And I was already familiar with Hellman & Friedman because of this guy, another investor in Tortoise Media, Patrick Healy.

Healy is the CEO of Hellman & Friedman.

He sits on its investment committee, leads its European division and is core to its media acquisition team. He also led Hellman & Friedman’s investment into, wait for it, Axel Springer, the Germany company now buying the Telegraph. (H&F has since exited from the firm.)

When James Harding came to present his vision for the Observer in the Guardian’s office, he took questions and I put up my hand. Was Patrick Healy a fit and proper person to be an owner of our newspaper, I asked? And I explained my reasons why.

Two years ago, Hellman & Friedman was revealed to have taken an undisclosed amount of investment from the Saudi public investment fund, Sanabil.

And just so there’s no doubt about who and what the Saudi sovereign wealth fund is, it’s a $776bn fund personally led by Crown Prince Mohammed Bin Salman. That’s Mr “Bonesaw” to you, the man who the CIA concluded ordered the killing of Washington Post journalist, Jamal Khashoggi.

The Guardian along with other media outlets rightly condemned the murder of Khashoggi in the strongest possible terms. It has published multiple blistering leaders on it, (leaders express the official voice of the newspaper). In 2018: “The Guardian view on the death of a critic: Riyadh must pay a price”. It published another in 2019 and again in 2023, and perhaps most appositely, of all, yet again in 2023: The Guardian view on Saudi Arabia’s rehabilitation: following the money.

“While most of the world is tightening its belt, Riyadh has billions to lavish on everything from PR executives to aid its rebranding to big-name architects to build the crown prince’s “city of the future” in the desert, Neom…[meanwhile] Executions have almost doubled under the crown prince…

“Unlike Saudi nationals, foreigners are free to challenge the kingdom – yet instead many use their voices to laud it. Why then should the country pause, when the price of its actions is so low?”

Harding assured us that Healy had invested in Tortoise Media in a personal capacity. Subsequently, a group of press freedom organisations raised the same points about his Saudi connections with the chair of the Scott Trust, Ole Jacob Sunde, who gave the same assurances.

Last December, I included Healy in a piece I wrote about Tortoise Media’s funding and included his response in the article:

This week, a spokesman for Healy said that his investment in Tortoise is as an individual and not on behalf of his firm. He disclosed that, contrary to Harding’s statement, he would not be participating in the latest round.

In fact, Healy did go on to participate in the latest round. As did the North Hatley Trust which is legally registered as being co-located in the office of his firm, Hellman & Friedman. I do not know if Healy has any relationship to or stake in the North Hatley Trust. Similiarly, I don’t know whether Sanabil, the Saudi sovereign wealth fund has any interest or money in the vehicle.

It does not publicly disclose its investments. The only public information, as Bloomberg reports, is that the Saudi Public Investment Fund commits around $2 billion a year into “venture, growth and small buyout assets worldwide” via portfolio companies of which Hellman & Friedman is one.

Neither Patrick Healy nor Hellman & Friedman responded to my queries on the matter. Nor did Tortoise Media/The Observer. This included a yes/no question of whether it has taken Saudi money. Ole Jacob Sunde, the chair of the Scott Trust (which owns the Guardian and is a co-investor in Tortoise Media) did not respond either. Only the Guardian press office answered my emails. A spokesperson said it did not wish to comment on this matter.

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What it means when someone won’t answer your press inquiries

Thirty years ago, when I trained as a news journalist, the importance of the “right to reply” was drilled into me. It’s an important defence in the event that a company goes legal but more than that it’s a matter of fairness. Even just a few years ago, it was unusual for a press office to simply ignore journalists’ inquiries. But now the rules on everything are broken and it’s increasingly standard practice. Why bother responding to a news outlet when most people think it’s “fake news” anyway?

But for a news organisation, it’s another rupture of another norm.

There may be a perfectly innocent explanation as to why the Observer is refusing to disclose the real identity of an opaque investor who happens to share an address with a private equity firm that’s taken a ton of cash from Mr Bonesaw, that’s why we send right to reply letters: to get the facts.

It’s not just a box-ticking exercise, it’s a crucial step to make sure you haven’t jumped to conclusions. It’s bad faith for anyone to not respond but something is profoundly broken when it’s a liberal news organisation that champions transparency and accountability. It’s the same reason why I believe the Guardian’s secrecy over its deal with OpenAI is so profoundly wrong. You can’t enter a financial arrangement with a subject you report on without disclosing the terms. Yet that’s exactly what it’s done.

Perhaps, you think, the Guardian’s leadership is ignoring my questions because they perceive me as a troublemaker. Well, doh! Of course they do and of course I am. That’s what investigative journalism is. They know that because they publish brilliant, important investigative journalism by my former colleagues.

I lost my job because I investigated this deal and my own news organisation, despite the same leadership’s public statements that no jobs would be lost. It wasn’t just me. The editor, Lucy Rock, lost her job too and last week, the Observer announced it was seeking further voluntary redundancies across the company with staff told they may be facing compulsory redundancies next.

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The UK government changes the law

Three weeks after the transfer of the Observer to Tortoise Media took place, the UK government changed the law to allow foreign state ownership of UK news titles. They also backdated the legislation to a year previously.

At least four news organisations lobbied the minister in question to get this law changed according to a report in the Guardian. The details remain secret.

I genuinely don’t know what to make of the government’s decision on this or why now but there’s no defensible argument for foreign state ownership of UK media, as argued in this excellent piece the by the Guardian financial editor, Nils Pratley:

In it, he actually points to the example of the Guardian and how it explained that it was taking a stake in Tortoise Media to “enshrine our values in the new ownership structure”.

So where are these values? Who is the Guardian’s co-investor in the Observer? Why the lack of transparency? How does this serve the public interest?

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The ‘how’ of this

I established these facts before Christmas, sent the right-to-replies and wrote it up as a straight-down-the-line news story. At that point, I sent it to trusted senior financial journalists and editors to sense-check it and get their input. And then I left it.

When I came to read it again, I doubted that anyone outside the small world of UK media would understand it or be interested. Stories about financial disclosures are pretty dull. More importantly, the “third person” omniscient voice is a con. A news story can look “balanced” and obscure all sorts of biases or agendas. And people know that. It’s why increasing numbers of people don’t trust newspapers any more.

I’ve taken a decision to write this in my own voice, as me, to clearly state my priors, and to lay out the evidence for you to judge for yourself. I’ve long been inspired by OSINT - open source intelligence. It’s a form of investigation that’s collaborative, open, doesn’t rely on unnamed sources and provides the evidence that you can double-check yourself. I’m not asking you to trust me on any of this.

I’m laying out what I’ve found. I don’t know what or who the North Hatley Trust is or why the Guardian and Observer won’t say. I doubt it’s in any way connected to the Palantir puff piece but I’ve decided to publish this today because it speaks to the central issue: it’s impossible to know when the newspaper won’t disclose its owners.

I have a personal stake in this story. I don’t want to pretend that doesn’t exist. It’s what also gives me a really deep understanding of the issues and what’s at stake. It’s why I care and why I’ve bothered to go digging and to ask the questions.

Press ownership matters. We are in a time of danger. And news organisations are falling like skittles. Guardian’s corporate structure - two boards, no effective governance - has enabled an executive leadership to make a series of decisions that, I believe, has unforgivably compromised its journalism. Whether those decisions - the deals with OpenAI and Tortoise Media - were the responsibility of the CEO, Anna Bateson, the chair of the Scott Trust, Ole Jacob Sunde, or others, I don’t know. But it’s the editor-in-chief, Kath Viner, who needs to answer these questions. She’s failed in her most important vital role: to protect her journalists and defend the Guardian’s journalism.

Not for the first time. Maybe I’m channelling my own trauma from my High Court trial here. It’s perhaps why I’m so reactive to what’s happening: secret deals with Silicon Valley companies, oligarchic power, shadowy moneymen. I don’t just know this stuff in my brain, I feel it in my cells.

The press is under a coordinated, global assault and I write this as a critical friend of what remains of Britain’s independent media: do not, in the historian Tim Snyder’s words, obey in advance. Stop doing dumb shortsighted self-sabotaging deals, stop thinking tech companies will save you, they never have and never will and answer the sodding questions when journalists put them to you.

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PS. There’s one more piece of information that the filings threw up. This one is for my colleagues who remain at the Guardian. Skip to the end if you want to get the fun video. But what Guardian journalists won’t know, because the management never told them, is that the Guardian took a large undisclosed financial stake in Tortoise Media before the transfer of the Observer took place.

Tortoise’s annual accounts show the company took £2.7million in convertible loans before the transfer. In the same period, Guardian News & Media acquired 382,096 shares in the company. These were dissolved on April 22 last year, the day the Observer transferred ownership. On that same day, the Scott Trust - Guardian News & Media’s owner - acquired 803,640 shares.

It suggests that Tortoise Media needed a substantial cash injection to survive up to the date of the transfer. It raises a question over how much the Scott Trust actually invested, whether it was the £5m announced previously or more. And for my union colleagues who negotiated terms for their departing colleagues with the Guardian and Tortoise Media, they did so not knowing that the Guardian was already a major shareholder in Tortoise Media.

The Guardian and Observer declined to answer any of my questions in relation to this deal.

PPS: If you’re a media investor or foundation that supports independent journalism, our crew at the Nerve would love to talk. Last weekend, our all-female new media start-up partnered with the brilliant independent festival, the Laugharne Weekend in the tiny, magical Welsh town where Dylan Thomas wrote Under Milk Wood. Thanks to our amazing columnist Stewart Lee for bringing us on board and the festival’s organisers Richard Thomas and John Williams for welcoming us in. There’s a flavour of it here.

Thank you to everyone who came. Would love to see you there next year if they have us back xx