In the spring of 2017, Daria Kaleniuk, an anti-corruption activist in Ukraine, noticed a video about herself circulating online.
“Authorities Sunday announced they’d made progress in an investigation against AntAC, the Anti-Corruption Action Center led by Daria Kaleniuk,” proclaimed a clean-cut news announcer with a Yorkshire accent, “regarding a 2 million dollar grant allocated for reforms in the Prosecutor General’s Office.”
The newscaster alleged that Kaleniuk had embezzled grant money provided by the United States embassy for anti-corruption reforms, implying that the young lawyer and anti-corruption reformer was herself corrupt.
There was one glaring problem with the newscast, however: it was fake. Online sleuths soon discovered that the newscaster was actually an actor who advertised his services on the Fiverr website. A second fake news clip in circulation leveled similar allegations against Kaleniuk’s AntAC co-founder, Vitaly Shabunin.
“The videos were obvious fakes,” Kaleniuk told The Times of Israel, “created in order to discredit our reputation. It was a time when AntAC was under significant pressure from some corrupt officials here in Ukraine.”
But who made the videos?
Two years after the videos appeared online, a report by independent journalist Scott Stedman, and based on Canadian court documents, revealed that an Israeli private intelligence company, Psy-Group, was allegedly behind the fake videos.
Psy-Group had been in the news since the New York Times reported in May 2018 that the FBI had traveled to Israel two months earlier and reportedly seized some of the company’s computers. According to The New York Times, the company had come to the attention of US authorities because it was suspected of offering covert social media manipulation services to the 2016 Trump presidential election campaign. The US Department of Justice has not since charged Psy-Group or its executives with any wrongdoing.
Kaleniuk recalled being flabbergasted when she learned that Psy-Group was allegedly behind the videos about her and her co-founder.
“I have a question for the Israeli government,” Kaleniuk said to The Times of Israel by phone from Ukraine. “How is it possible that a private Israeli company was intimidating civil society organizations like mine in Ukraine? And why does this go without any reaction from the Israeli government? How is the work of these private intelligence companies regulated, if it is regulated at all, in Israel?”
An unregulated industry?
On a regular basis over the past few years, disturbing revelations have emerged about private Israeli intelligence companies allegedly helping authoritarian regimes surveil dissidents, driving high-tech spy vans around foreign countries, or mounting covert campaigns to interfere in foreign elections. It is often unclear who these firms’ clients are and why the Israeli government appears to turn a blind eye to their activities.
What’s more, according to corporate documents seen by The Times of Israel, the now-defunct Psy-Group was owned by a British Virgin Islands company that is closely associated with Russia’s partly state-owned Gazprombank.
Kaleniuk told The Times of Israel that the people she believes to be behind the fake videos also have alleged ties to Gazprombank, suggesting a strange and unexplained alignment of interests, reported here for the first time, between an Israeli company staffed by former intelligence officers and the Russian government.
Such an alignment underlines disturbing questions about the extent to which an Israeli shadow economy of cybersecurity, private intelligence and fraudulent e-commerce startups is financed or even directed by entities abroad in a way that is poorly understood and that could prove corrosive to Israeli society and democracy.
It further highlights how little is known about Israeli-run online disinformation campaigns, whom they target and how extensive they are. The only reason information has emerged about the activities of a single company, Psy-Group, is due not to efforts by Israeli watchdogs or law enforcement but as the result of a Canadian lawsuit and media reports of an FBI probe.
Psy-Group was founded in late 2014 by Israeli-Australian Joel Zamel and former Israeli military intelligence officer Royi Burstien. “Psy-Group” is in fact the trade name of an Israeli firm called Invop Ltd. that was was owned by a Cypriot company called Ioco Ltd., whose director was Zamel and which was in turn owned by another offshore company. In July 2016, ownership of Ioco Ltd in Cyprus was transfered to a British Virgin Islands company known as Protexer Ltd.
Invop Ltd., the Israeli company, went into liquidation in April 2018.
“Investigators have questioned numerous witnesses in Washington, New York, Atlanta, Tel Aviv, and elsewhere about what foreign help may have been pledged or accepted, and about whether any such assistance was coordinated with Russia, according to witnesses and others with knowledge of the interviews,” The New York Times May 2018 article reported.
The New York Times also reported that one of Zamel’s companies had previously worked for Russian oligarchs Oleg Deripaska and Dmitry Rybolovlev, reportedly conducting online campaigns against their business rivals.
According to its marketing material, Psy-Group offered intelligence gathering, perception management and social media influence campaigns to private clients. It boasted that many of its employees were former Israeli intelligence operatives and even offered boots-on-the ground espionage services that included the use of “honey traps.” Writing in the New Yorker, journalists Adam Entous and Ronan Farrow dubbed the company a “private Mossad for hire.”
Both the Trump campaign and Zamel told reporters that Psy-Group had never carried out an influence campaign on behalf of the Trump campaign.
A source familiar with Psy-Group insisted to The Times of Israel that any links the company appears to have to Russian entities are purely coincidental and that its complicated ownership structure, involving companies in multiple jurisdictions, was set up for legitimate business reasons.
Fake videos with real consequences
Kaleniuk and the people she suspects made the fake videos about her represent two sides of a battle over Ukraine that came into the spotlight during the impeachment of US President Donald Trump.
On one side are pro-Western reformist organizations in Ukraine like AntAC and the American diplomats and the other Western governments who supported them. AntAC was founded in 2011 to monitor and encourage law enforcement bodies to investigate acts of corruption.
“AntAC is an advocacy group that is designed to both publicly bring attention to issues related to corruption, to advocate for better laws and better prosecutions, and on occasion it has also participated in some of the capacity-building activities that were funded by the U.S.,” Deputy Assistant Secretary of State for European and Eurasian Affairs George Kent told the US House Intelligence Committee in October 2019.
The United States has had a longstanding policy of democracy promotion abroad and has supported NGOs like AntAC on the understanding that clean government would bring Ukraine closer to the West while distancing it from Russian influence.
“The Ukrainian people understand that [corruption makes them vulnerable to Russia]. That’s why they launched the Revolution of Dignity in 2014, demanding to be a part of Europe, demanding the transformation of the system, demanding to live under the rule of law,” former US Ambassador to Ukraine Marie Yovanovitch told the House Intelligence Committee in November.
But, on the other side, AntAC and other reformist NGOs in Ukraine have acquired many detractors as well, including some pro-Russian Ukrainians and their foreign supporters who oppose, or stand to lose from, the kinds of reforms that organizations like AntAC advocate.
These opponents include former New York mayor Rudy Giuliani, who has accused AntAC activists in television interviews of being agents of liberal billionaire philanthropist George Soros.
“George Soros had a not-for-profit called AntAC,” Giuliani said in a September 20 interview on CNN. “AntAC is the one that developed all of the dirty information that ended up being a false document that was created in order to incriminate Manafort.”
Paul Manafort, who was President Trump’s campaign manager from June-August 2016, was convicted in the US of tax and bank fraud as well as illicit lobbying after spending over a decade as a consultant and lobbyist for pro-Russian Ukrainian politicians. In March 2019, he was sentenced to a total of seven-and-a-half years in prison, and was moved to house arrest this month amid the COVID-19 crisis. Giuliani has repeatedly advanced the theory that Soros directed AntAC to fabricate evidence falsely incriminating Manafort. In fact, it was NABU, the Western-backed National Anti-Corruption Bureau of Ukraine, not AntAC, that produced evidence that Manafort had allegedly received $12.7 million from ousted Ukrainian president Viktor Yanukovych’s Party of Regions.
Another opponent of AntAC is former prosecutor general of Ukraine Yuriy Lutsenko, who opened investigations into the organization and who reportedly gave Giuliani alleged damaging information on US Democratic presidential candidate Joe Biden.
The two fake videos from May 2017 that were allegedly produced by Psy-Group circulated online, garnering a total of more than 22,000 views, and were quoted in some Ukrainian news reports as if they were genuine, according to the Wall Street Journal.
On May 23, 2017, around the same time the videos were released, a Ukrainian parliament member, Pavel Pynzenyk, screened a documentary called “How AntAC works off the grant money” that expanded on the themes in the video clips and attempted to show embezzlement by AntAC executives. Pynzenyk said in parliament that he planned to submit evidence of criminal activity to the General Prosecutor’s Office, the Tax Authority and Western governments.
“Despite the high wages of the members of this association [Anti-Corruption Action Center], additional funds were transferred to individual entrepreneurs,” he claimed in parliament.
On August 2, 2017, AntAC announced that Ukrainian tax police had opened a criminal case against the organization. “This is a consistent continuation of the campaign against us, and the main goal is the destruction of the organization,” Shabunin said in a press release.
Kaleniuk said she was not surprised by the videos because, she said, her organization had been fighting disinformation campaigns since its founding in 2011.
“We are under constant pressure of Ukrainian armies of trolls and corrupt law enforcement agencies,” she has said. Her co-founder, Shabunin, was attacked with a green liquid in July 2018 and suffered chemical burns to both eyes.
The ease of being anonymous online
When Kalneniuk and Shabunin initially tried to figure out who was behind the two fake videos, they only got so far. The YouTube channel that featured the videos called itself “Storozh Ukraina” or “Ukrainian watchman.” A website with the same name and logo appeared on the Internet a day after the first video went up. It was entirely devoted to accusing AntAC activists of corruption. But it was registered through eNom, Inc., which allows website owners to be anonymous.
The website itself did not name its authors, stating vaguely that “we are an organization that seeks to make the country as independent and strong as it should be.”
“We are a group of Ukrainians who do not want our country to continue to serve foreign interests: neither Russian, German, nor American. We will expose corrupt officials and foreign agents wherever we see them, in the East or in the West.”
The AntAC leaders nevertheless had strong suspicions that one of the oligarchs or politicians who was being investigated by NABU, the National Anti-Corruption Bureau of Ukraine, was behind the videos and Storozh Ukraina website. NABU is an investigative body akin to the FBI that investigates corruption by high-level politicians and businessmen. It was set up by the Ukrainian government in 2014 as a precondition of receiving loans from the International Monetary Fund as well as a precondition for the European Union to grant visa-free travel to Ukrainians.
Following the trail of clues
It took an unrelated news report from halfway around the world, as well as a series of coincidences, to eventually lead to a clue that Israelis were allegedly involved in the disinformation campaign against AntAC.
On October 5, 2017, the New York Times published an article describing decades of allegations of sexual misconduct by movie mogul Harvey Weinstein. A month later, the Daily Mail revealed the identity of an employee of the Israeli private intelligence firm Black Cube who had befriended actress Rose McGowan, one of Weinstein’s accusers. The report named the woman as Stella Penn Pechanac.
“The pretty blonde spy who duped Rose McGowan into meeting privately with her while working undercover for Harvey Weinstein is a 30-something-year-old Israeli military veteran named Stella Penn,” the Daily Mail reported.
Nearby, in Canada, employees of a hedge fund called West Face Capital saw Pechanac’s photograph in news reports and happened to recognize her.
West Face Capital had for several years been caught up in a complex legal dispute with a rival Canadian hedge fund called Catalyst Capital. When employees saw photos of Penechac they recognized her as a woman who had approached several employees of West Face Capital and invited them for job interviews in places like London and Hong Kong for companies that they later learned did not exist.
“The affected employees said [in affidavits] that they only realized what had happened when they saw photographs in published articles about the Weinstein scandal of an alleged Black Cube agent identified as former Israel actress Stella Penn, also known as Stella Penn Pechanac,” the National Post reported.
West Face Capital eventually sued Black Cube for allegedly defaming the company using dirty tricks and disinformation campaigns, but it also named another defendant, Psy-Group.
Psy-Group did not defend itself against that lawsuit. The firm has been “noted in default” by the Ontario court, meaning that it did not defend the litigation in Ontario, Canada.
Black Cube said in its statement of defense that it had been hired by Catalyst for purposes of “litigation support” and that the meetings its operatives held with various individuals were in no way illegal, and that the company had never participated in any alleged defamation of West Face Capital.
An affidavit submitted in the lawsuit by National Post journalist Christie Blatchford, recounts how a Psy-Group employee allegedly worked in tandem with Black Cube. According to Blatchford, Israeli journalist Emmanuel Rosen, who used his real name and worked full-time for Psy-Group at the time, had tried to pitch a story to her about the legal dispute between West Face Capital and Catalyst Capital using information allegedly surreptitiously collected by Black Cube.
“On October 12, 2017, I met in person with Rosen at the Broadview Hotel in Toronto’s east end. During this conversation, Rosen told me his real name, and explained a little bit about his background. He told me that he was a journalist and documentary filmmaker based in Israel,” Blatchford stated in her affidavit. “Rosen attempted to persuade me to publish an article (or articles) about Justice Newbould and West Face.”
The Times of Israel reached out to Rosen for a response to the claims in Blatchford’s affidavit but did not hear from him prior to publication.
If employees of West Face Capital had not come across reports about Black Cube and Harvey Weinstein, the Ukrainian anti-corruption activists may never have discovered that Psy-Group was allegedly behind the video campaign against them. It took litigation by a hedge fund, with the resources to conduct in-depth investigations, to begin to uncover some of the alleged activities of Psy-Group.
A Stanley Tucci lookalike
As West Face Capital tried to learn more about who had posted allegedly defamatory things about their company online, they found a series of email addresses they believed were linked to Psy-Group employees and subpoenaed several large technology companies, including Google and PayPal, to learn more.
That’s how they came across yet another player in the drama of Psy-Group’s alleged activities: a woman in Croatia named Maja Bogovic who appears to have been hired, allegedly, by a Psy-Group operative over the Internet.
In her affidavit, the Croatian woman said that in September 2016 she was approached via LinkedIn and eventually hired to be the personal assistant of a man named “Francesco Gianelli” who claimed to be a management consultant based in Hong Kong. The woman now believes that Francesco Gianelli was a made-up name, but she did in fact meet a person claiming to be Gianelli twice, once in a hotel lobby in Zagreb and on another occasion when he paid for her to fly to a meeting in Larnaca, Cyprus.
“Gianelli and I met for the first time at The Westin Hotel in Zagreb. He was
well-dressed in a business suit, and I recall that he wore glasses and was bald. At first glance, he reminded me of the actor Stanley Tucci. We spoke about our respective personal lives. He told me that he was Italian, and had gone to university in Milan. He said that he had gone on to work in India and was at that time working for Contrell in Hong Kong. He told me that he had a wife, three children and a dog.”
“Gianelli” would ask the woman, via email and Whatsapp, to carry out various tasks, like incorporating companies in the British Virgin Islands and purchasing domain names. She never entirely understood why she was doing this.
One of the tasks the woman described in her affidavit was paying for videos on Fiverr about the Ukrainian anti-corruption activists.
“On May 4, 2017, Gianelli sent me an email with instructions to log in to an account on the website Fiverr.com,” she stated in her affidavit, “which is another website that provides a marketplace through which users can purchase various freelance services on demand. Gianelli provided me with a username (carlosc1234) and an email address (firstname.lastname@example.org) in order to log in. Gianelli instructed me to purchase two items that were placed in the user’s virtual ‘shopping cart’ for a total of US $168.00. The two services that Gianelli directed me to purchase were: (1) creation of a “Breaking News VIDEO Commercial Special Offer”; and (2) creation of a ‘News Style Spokesperson Video in HD.’ I came to learn that the two purchases I was instructed to make on Fiverr.com led to the creation of two videos that were posted to YouTube in May 2017.”
The woman testified that she had been asked to create a gmail account under an assumed name to carry out her duties. When Google informed her that it had been served with a subpoena regarding the email account she had created, she wrote her boss “Francesco Gianelli.” To her astonishment, he had vanished.
“In December 2017, I attempted to email both Gianelli and Emma [his assistant],” she said in her affidavit, “but in response I received automatic message delivery failure notifications advising that their email addresses no longer existed. Also I could not reach them through WhatsApp. It was at that point that, for the first time, I became skeptical about the situation. I looked for Gianelli’s Linkedln profile and could no longer find it. I also looked for the Contrell website and could not find it. At this point I actually became scared and concerned that I had been dealing with people who were not who they said they were. I felt very naive and foolish for having been used.”
West Face Capital has alleged in its lawsuit that “Francesco Gianelli” was actually the fake identity of a Psy-Group employee who hired this woman so that payments, company incorporations and domain name registrations carried out by Psy-Group could not be traced back to the company.
Psy-Group declined to respond on the record to the question of whether it had produced or paid for the videos about the Ukrainian anti-corruption activists.
Who allegedly hired Psy-Group?
If, as West Face Capital alleges, Psy-Group hired the woman who paid for the anti-AntAC videos, who hired Psy-Group to do so?
While the Storozh Ukraina website did not indicate who was behind it, the site extensively extolled the activity of Pavel Penzenyk, a member of the Ukrainian parliament from the People’s Front party. The website also wrote admiringly at length about the activity of an NGO called “National Interest” of Ukraine. The NGO’s website had been created on May 22, 2017.
On May 23, Penzenyk made a speech and presented a film made by the NGO accusing AntAC of embezzling funds. Pynzenyk is a long-time assistant of ex-MP Mykola Martynenko, who was recently indicted in Switzerland for alleged money laundering of 2.8 million Euros. Martynenko is also under investigation by Ukrainian and Czech law enforcement authorities.
Prosecutors allege that a Czech company called Skoda JS, a subsidiary of Russia’s Gazprombank, paid bribes to an offshore company owned by Martynenko in exchange for the awarding of contracts to supply components to Naek Energoatom, the Ukrainian state operator of nuclear power stations. The allegations are particularly scandalous because they suggest that a Russian company had corruptly become a supplier of vital Ukrainian infrastructure despite the fact that the two countries are at war.
Martynenko denies the allegations and has said that the investigations against him are politically motivated.
In fact, corporate registration documents show that the Czech company Skoda JS is owned by OMZ BV, which is owned by Gazprombank.
“The person who conducted the campaign against us was a close associate of Mykola Martynenko who has been indicted for money laundering,” Kalneiuk told The Times of Israel.
“We were attacked because we protect the NABU,”said Kaleniuk. “This agency conducted an investigation of complex international money laundering against Martynenko. The money laundering case involves a Czech company called Skoda JS that in fact belongs to Gazprombank. NABU provided evidence that the money was used by Martynenko’s children for private expenses,” she said.
Ties to Gazprombank
The now defunct Israeli company Psy-Group was owned, from July 2016 until its dissolution in May 2018, by a British Virgin Islands company called Protexer Limited. Information has recently emerged, reported here for the first time, that the anonymously owned Protexer Limited is associated with Gazprombank and Gazprom Media, Russia’s largest media holding company and a subsidiary of the Russian-government-owned energy conglomerate Gazprom.
In numerous articles and a book, US journalist Scott Stedman has previously reported Protexer Limited’s extensive ties to Russian entities.
Protexer Limited owned the Cypriot company Ioco Limited, which in turn owned the Israeli Invop Ltd., which used the trade name Psy-Group in its marketing and communications.
Sources familiar with Psy-Group told the Times of Israel that it was a mere coincidence that Protexer’s other subsidiaries have connections to Russia, much in the same way several clients might share a law firm but have no connection to each other.
By that analogy Protexer Limited would have many subsidiaries from different industries and different parts of the world. In fact, Protexer Limited only has seven or eight publicly known subsidiaries. Almost all of them are connected to Russia, as Scott Stedman has previously reported.
For instance, Stedman found that one subsidiary, M.G.T.M. Financial Services, is an investment advisory firm controlled by Russian billionaire Mikhail Slipenchuk, a former member of the State Duma for Vladimir Putin’s United Russia party.
Stedman also found that Protexer Limited had once controlled a Polish solar energy company that was in turn controlled by Vasyl Khmelnytsky’s UFuture Investment Group. Khmelnytsky, Stedman wrote, “is a Ukrainian multi-millionaire who happens to be longtime business partners with the developers of Trump Tower Toronto, Alex Shnaider and Eduard Shifrin.”
There were other connections as well.
“An investigation into the people that manage Psy Group’s Cypriot and British Virgin Islands parent companies, as well as related companies, kept pointing to Russian finance,” Stedman wrote in his book, “Real News: An Investigative Reporter Uncovers the Foundations of the Trump-Russia Conspiracy.”
“They worked with high-profile Russians who were affiliates for Russian banks, they did business in Russia, and they catered to Russian clients.”
Recent corporate filings posted since Stedman’s reports were published reveal another Protexer connection.
On November 29, 2018, a new company was created in Cyprus by the name of Benton Solutions Ltd. This company, Benton Solutions (Cyprus) Ltd., appears to be a successor company to Benton Solutions Inc., which was registered in 2002 in the British Virgin Islands.
The new Cypriot company’s shareholder was listed as Ecofran Marketing, Consulting and Communication Services Company Limited, which happens to be a subsidiary of Gazprom Media, according to Russian corporate filings.
But Ecofran Marketing, Consulting and Communication Services Company Limited is not just any “subsidiary.” According to Russian corporate documents, the company gave millions of dollars in loans to Russian companies that are part of Gazprom Media, owned by Gazprombank. The energy conglomerate Gazprom, one of the owners of Gazprombank, has long been described as a “slush fund for the Kremlin’s off-the-books needs,” according to The New York Times. Many of the company’s top executives are reportedly former KGB officers.
Meanwhile, a 2019 securities disclosure for Gazprombank, which owns Gazprom Media, listed Benton Solutions in Cyprus as one of the companies it controls.
Skoda JS, a Czech company that won a government contract to build nuclear reactors in Western Ukraine, and that allegedly paid bribes to AntAC foe Mykola Martynenko, is a subsidiary of Netherlands-registered OMZ BV, which is owned by Russia’s state-owned Gazprombank, according to the company’s most recent corporate report.
Gazprombank’s main shareholders are the state-owned energy company Gazprom as well as Gazprom’s pension fund Gazfond. In July 2014, the United States Department of the Treasury imposed sanctions on Gazprombank in response to Russia’s invasion of Crimea and the war in the Donbass.
These sanctions, the US government explained, “send a strong message to the Russian government that there are consequences for their actions that threaten the sovereignty and territorial integrity of Ukraine.”
Gazprom Media owns a broad swathe of Russia’s media ecosystem, including the popular television channel NTV, satellite broadcaster NTV-Plus, entertainment channel TNT as well as other television, radio, Internet, paper and cinema holdings. NTV is known for disseminating pro-Kremlin disinformation, according to EUvsDisinfo, a website published by the East Stratcom Task Force of the European Union. Examples of journalism appearing on Gazprom Media’s NTV include allegations that Joe Biden has covered up trade in human organs, that pro-Western former Georgian president Mikhail Saakashvili is controlled by George Soros, and in a different news report, that Saakashvili allegedly had sex with a teenage crossdressing prostitute.
The director of Benton Solutions, the subsidiary of Gazprom Media, is Protexer Limited. Experts on Russian corporate structures consulted by The Times of Israel said that it is highly unlikely that Protexer could occupy such a sensitive position, as the director of a company owned by both Gazprom Media and Gazprombank, if Protexer were not associated with those companies.
The Times of Israel contacted Gazprombank to ask about its connection to Protexer Limited and Psy-Group but did not hear back prior to publication.
A source familiar with Psy-Group denied that it had any connection to Gazprombank or other Russian entities.
“The ultimate beneficial owners were all Israeli,” the source told The Times of Israel, explaining that the company had been advised by lawyers to use a British Virgin Islands company as its owner and that the fact that Protexer’s other subsidiaries are connected to Russia is pure coincidence.
“The structure was set up for business, operational and tax reasons in accordance with legal advice,” the source said.
The source also denied that Psy-Group had been involved in influence campaigns before the 2016 US elections.
“Any reports of any influence campaigns conducted to influence the outcome of the US elections are completely false,” the source said.
Joel Zamel, Psy-Group’s owner and founder, told The Times of Israel that he founded the company to counteract anti-Israel activity and that this was its main purpose. Zamel declined to answer questions about who Psy-Group’s clients were.
“The company was founded to conduct counter-extremism activities including social media operations to discredit, expose and shame Islamic terrorists and their supporters, anti-Israel organizations, and anti-Semitic activists online,” said Zamel. “We don’t discuss our clients or our projects, so unfortunately I cannot respond to such questions.”
A former senior executive at the company told The Times of Israel that he feels the private intelligence industry is “widely misunderstood.”
“The methods are framed as cloak and dagger, but should be considered in context. The activities vary between different companies and different types projects. Just like journalism, such methods can be used for good or for bad. Our company was established to conduct proactive, lawful campaigns that discredit the extremist ideologies that thrive on social media. We are proud of our employees and the work that they did. We believe these methods are underutilized, can be highly effective and have an important role to play.”
The e-commerce connection
If Protexer Limited is connected to Gazprom Media and Gazprombank, this makes the identity of one of Psy-Group’s sister companies (both were owned by Protexer Limited), reported here for the first time, all the more curious.
One of six Cypriot companies owned by Protexer, in addition to Ioco Ltd. and M.G.T.M. Financial Services Ltd., is called Akirma Ventures Limited. Akirma Ventures Limited has a faint digital trail. A Google search does reveal however that in 2016 it owned the e-commerce website Guaranteetickets.com. Akirma Ventures was ordered to stop doing business in March 2016 by a French court after the Union of European Football Associations said that it was selling football tickets without authorization.
The website had “advertised on Google but UEFA says it has no right to sell Euro 2016 tickets and that tickets bought through unofficial channels may not gain the buyer entry to the matches,” according to Reuters.
Despite the court order, the site continued to operate through the end of 2016. Guaranteetickets.com did not reveal on its website that it was run from Israel by two Israeli companies, Global Ticket Ltd. and Moonshot Marketing, a fact revealed in Israeli legal disputes both companies became involved in.
Moonshot Marketing described itself in 2015 as a technology company that helped websites rise high in search engine rankings through algorithmic search engine optimization. By 2017, Moonshot Marketing had pivoted in a new direction. It owned a technology platform for entrepreneurs seeking to launch a binary options, forex or crypto financial trading website. The platform is called Finantick, and claimed in its marketing material in 2018 to provide backend technology to 84 online trading websites in 14 countries.
‘What we have now is anarchy’
Last summer, Ha’aretz reported that an Israeli government ministry was trying to block West Face Capital, the Canadian hedge fund, from accessing information on Psy-Group’s computers, which it seeks to do in the context of the discovery process in the ongoing legal dispute between the companies.
“Although the Justice Ministry unit responsible for blocking the backup process has a legal basis for its move, the decision of the Central District Magistrate’s Court last November was made in a closed hearing. No information about what was said at the hearing or why it was held has been made public,” the report said.
The legal dispute is ongoing and the Israeli government continues to block efforts to disclose the contents of the company’s computers, legal filings show.
The Ha’aretz report speculated that the Ministry for Strategic Affairs may have been trying to prevent the public from learning of its possible connections to an anti-BDS (Boycott, Divest Sanctions) campaign allegedly carried out by Psy-Group. The ministry, which carries out secretive anti-BDS activity of its own, has repeatedly denied having anything to do with Psy-Group.
But the report raised the larger question of what, if any, connection the Israeli government has to private intelligence companies like Psy-Group and Black Cube, and if no such connection exists why the government does not speak out against some of their reported activities, like alleged election interference, that have scandalized public opinion worldwide.
Journalists including Ha’aretz’s Yossi Melman have speculated that the government does not speak out against private intelligence companies because it does not want to interfere with the golden goose of Israeli defense exports.
“When the prevailing attitude [of SIBAT, the Defense Ministry’s International Defense Cooperation Directorate] is to avoid obstructing possible deals… it’s no wonder the Defense Ministry, the Knesset Foreign Affairs and Defense Committee, the state prosecution, the military censor and the courts close ranks in the name of information security,” Melman wrote in December.
Other observers, like American journalist Seth Abramson, have hypothesized that some of these companies may operate with the tacit approval of the Israeli government because their activity helps advance geostrategic goals, like rapprochement between Israel and the rulers of Gulf countries, who have reportedly used Israeli spyware to stifle domestic dissent.
Dr. Avner Barnea, Research Fellow at the National Security Studies Center of the University of Haifa and a former senior official with the Israel Security Agency (Shin Bet), told the Times of Israel that he thinks the explanation is simpler.
“The bureaucrats in the Defense Ministry don’t have the know-how or sophistication to deal with this. The brilliant technological minds from military intelligence or the 8200 unit are running circles around them.”
According to Barnea, Israel has a very clear and draconian law, the “Defense Export Control Law,” that forbids Israelis from transferring defense know-how to foreigners without a license from DECA, Israel’s Defense Export Control Agency.
“The law is very simple,” said Barnea. “You are not allowed to reveal methods or knowledge you gained during your military service to foreigners unless you get proper authorization. If you do so without permission, you can be accused of espionage.”
But when it comes to the proliferation of private intelligence companies in recent years, the law is not being enforced, Barnea said.
“There is ongoing negligence. No one is enforcing the DECA law. The government needs to catch one of these private intelligence company operatives and put him on trial and then the others will be afraid and understand that you are not allowed to do this. What we have now is anarchy.”
As for the significance of an Israeli intelligence company possibly working on behalf of, or being owned by the Russian government, Barnea said, “if this is the case, it is against the law. Israel and Russia have some cooperation but we also have rivalry on many defense issues. Israelis are not allowed to divulge defense secrets or methods to foreign governments. If you do so you are breaking the law.”
A source close to Psy-Group’s leadership rejected the notion that the company has ever done anything illegal.
“All sensitive projects were conducted under the oversight of top-tier law firms around the world, to ensure full compliance with the relevant laws and regulations,” the source said.