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THE ECONOMIC COST OF BAD ACTORS ON THE | 2019 bullying, andfakenews. bullying, andsocietyduetoproblems adfraud,online including and dataanalysis,wemeasure globaleconomicpricepaid by the time, usingeconomic analysis,alongsidestatistical first For the scaleofinternetharm. full economicanalysisof the ever in-depth University of Baltimore,Roberto Cavazosatthe first toundertakethe internet.CHEQhas commissioned economist,Professoractors onthe In aseriesofreports, wereveal monetarycostcausedbybad the commit.’’ whospreadto those hatred, kindsofcrimeeasierto andmadeall easier,lives ithasalsocreated opportunityforscammers,givenavoice opportunity, givenmarginalized groups avoice,andmadeourdaily internethasput it:’’While ofthe father the web hascreated the representing totalGDP. 5.3%oftheir However, BernersLee, asTim more G20countriesaloneisworth economy ofthe $4.2trillion than The internethasheraldedaneconomicrevolution. Theinternet INTERNET OF BAD ACTORS ON THE TO THE ECONOMIC COST INTRODUCTION

2 FAKE NEWS | 2019 THE COST OF FAKE NEWS: A $78 BILLION PROBLEM The World Economic Forum ranks the In this report we analyze the economic damage spread of misinformation and fake news, of the fake news crisis globally, affecting as among the world’s top global risks.1 everything from stock markets to media, In line with other reports, the forum finds , election campaigns, that fake news outlets and operations financial information and healthcare. We are seeing unprecedented traffic and discover the paid in the form of both engagement. direct and indirect costs which collectively undermine the cardinal principle of trust that underpins free market economies.

FAKE NEWS DEFINED One of the many investigations to have Fake news can be misinformation, where been carried out around the world into fake information is missing, and done in error. news defined the phenomenon as follows: However more seriously, fake news entails ‘‘The deliberate creation and sharing of deliberate where false and false and/or manipulated information misleading information is sowed to mislead, that is intended to deceive and mislead manipulate or harm for which there is invariably audiences, either for the purposes of a large economic price tag attached. causing harm, or for political, personal or financial gain’’ 2

1 WEF: The Global Risks Report 2018 http://www3.weforum.org/docs/WEF_GRR18_Report.pdf

2 House of Commons Digital, Culture, Media and Sport Committee Disinformation and ‘fake news’: 2019 | NEWS FAKE

Final Report https://publications.parliament.uk/pa/cm201719/cmselect/cmcumeds/1791/1791.pdf 3 FAKE NEWS MARKET FOR THE BOOMING least 18countries inat have beendetectedduringelections onpumpingoutmisinformation spending significant Inaddition, disinformation. a yearonpro-Kremlin tocreate media Russia spends atleast€1.1bn($1.2billion) Europeanthe Commissionhasclaimed Andrus Ansip,formervice-president of areof fakenewsoperations significant. simply plainprofit. Thelevelandcosts byideology,bad actors,motivated or news encompassesstate-sponsored The creation offake anddissemination controlled byU.S.activists’’. $100,000, whichwere ‘‘falsely claimedtobe totaling over 3,500advertisements, discord UnitedStates”purchased inthe to “provoke andsocial political andamplify InternetResearchthe Agency(IRA)inabid 2016Presidential duringthe that election, Report found Mueller United States,the FAST-GROWINGCHALLENGES TECH financial controllers intotransferringcash. designedtotricksenior of chiefexecutives reported three casesofdeepfakedaudio or videos.Securityfirm,Symantec,has images andvideosontosource images fakes’’ combineandsuperimposeexisting In arelated andfast-growing threat, ‘‘deep -and-digital-threats/fake-news-cyber--the-abuse-of-social-media. TREND MICRO(June13,2017),https://www.trendmicro.com/vinfo/us/security/news/The UseAndAbuseofSocial Media, 5 4 3 community-now-living-in-fear-after-reporter-gets-it-wrong-checkup-caller-1.4454463 https://www.cbc.ca/radio/checkup/fake-news-how-do-you-ensure-the-news-you-get-is-trustworthy-1.4450145/ , Vladimir KropotovLion Gu,Vladimir &FyodorYarochkin, Fake NewsandCyberPropaganda: Freedom net2017report, onthe Freedom house,https://freedomhouse.org/report/freedom-net/freedom-net-2017 3 . Mostfamously, inthe referendum courseofa orchangethe impact elections, changesontrade agreements,influence policy discredits and$400,000to ajournalist; to fundaTwitter successfully that attack more $55,000isenough 300,000followers; than accountwith $2,600 canbuyasocialmedia to entry. Initsreport, Trend Microthat finds users.Wemillion seeextremely lowbarriers during2018reachingjust over10months 10.9 in transparency, spent£257,000($336,000)in andlacking described as“highlymisleading” Brexit “Mainstream Network” pro- onfakenews,that in itsdeliberations heard UKParliament In asimilarvein,the and societies, as we shall explore. asweshall business andsocieties, andconfusionon economic disruption canwreakaccurate fakenewsgeneration emerging technologyalongsidehighly of $243,000toaHungariansupplier. This based energy companytoforce wring the voiceofaCEOanunnamedUK- used the In onecasealone,adeepfakevoiceattack ($980 USD)inincome. claimed togenerateroughly $1300amonth aloneforinstance outlets false Canadian 4 . Incomecanbesteady:seven 5

4 FAKE NEWS | 2019 THE COSTS OF FAKE NEWS EXPLORED In the following section we look at diverse sections of the economy facing very real costs from the growing multitude of bad actors propagating fake news.

STOCK MARKETS AND FAKE NEWS LOSSES

Stock market rises and falls from fake news

2012 2015 2016 2017 2017 2017 2019 2019 Crude Oil Twitter Vinci S&P 27 Ethereum BlackRock Metro sector Businesses Bank

A Twitter user Twitter’s shares Shares in the French It was falsely The SEC brought fake news stories in News outlets were Shares in the UK's impersonated the jumped more than construction giant reported that a civil charges June 2017 reported duped by a letter Metro Bank Russian Interior 8% after a fake fell more than 18% National Security against 27 Ethereum’s founder purporting to come plunged 11% Minister, tweeting online story about a after a fake press Adviser would businesses and had died in a car from Larry Fink, before it could that Syria’s President $31bn takeover release said the firm testify against individuals for crash and the CEO of investment shake off inaccurate Bashar al-Assad offer. would restate its Donald Trump. The creating deceptive company's market firm BlackRock rumors “has been killed or accounts. S&P 500 dropped online content. dropped by leading to that it was facing injured”, causing by 38. points, $4 billion fluctuations worth financial difficulties. crude oil to equivalent to a hundreds of rise by over US$ $341 billion loss. millions of dollars. 1.00. FAKE NEWS | 2019 | NEWS FAKE 5 Fake news caused stock market losses Mike Paul, president of Reputation Doctor of $300billion in a single incident. This says: “Fake news today is like a modern- occurred in December 2017, when ABC day tech suicide bomber in the worlds of reported that “National Security Adviser , reputation and branding. It Lieutenant General Michael Flynn, would only takes one well-planned success to hurt a testify that Donald Trump had instructed lot of people or an organization.”8 him to contact Russian government officials during the 2016 election campaign. The impact is likely to have a wider issue for This would have opened the door to smaller firms, research has revealed. Yale impeachment, and a crisis of government in School of Management found deceptive the world’s largest economy. Following the articles on investment appear to story, from 11:06 to 11:34 a.m. the S&P 500 temporarily boost stock prices, noting a (the weighted index of the 500 largest U.S. particular effect for small firms publicly traded companies) dropped by 38. points6. Multiplied by the S&P’s number of In his outlook for 2019, Marko Kolanovic global equivalent shares this was a loss of $341 head of macro quantitative and derivatives billion. It turned out that this “bombshell research, at JPMorgan Chase, singled out the report” from ABC was false. ABC did not dangers of fake news. ‘‘There are specialized retract the news until after the trading day, websites that mass produce a mix of real and at which point the loss was lessened to $51 fake news. Often these outlets will present Billion. somewhat credible but distorted coverage of sell-side financial research, mixed with Even set within a $78 trillion capitalization geopolitical news, while tolerating hate speech for global stock markets, a single stock in their website commentary section. If we market effect totaling $341 billion shows add to this an increased number of algorithms the economic damage from a case, or that trade based on posts and headlines, the handful of instances of misinformation. impact on price action and investor psychology While financial markets have been can be significant.”9 dealing with , and fake news for decades, technology advances From a perspective, based in technology and the ubiquity of access on an analysis of past cases involving fake news to web-based information heightens the inflicting damage on global stock markets, we risks and costs of fake news by orders of find a potential loss of up to 0.05% of stock magnitude7. market value is at risk due to fake news. This amounts to $39 billion annual loss as a direct result of fake news.

6 Cost of Fake News for the S&P 500. Seeking Alpha, December 4, 2017. https://seekingalpha.com/article/4129355-cost-fake-news-s-and-p-500 7James Warren, December 2016, When Fake News Costs Real Money, Vanity Fair. https://www.vanityfair.com/news/2016/12/when-fake-news-costs-real-money

8 Clair Atkinson, April 25, 2019, Fake news can cause ‘irreversible damage’ to companies — and sink their stock price. NBC News, https://www.nbcnews.com/business/business-news/fake-news-can-cause-irreversible-damage-companies-sink-

their-stock-n995436 2019 | NEWS FAKE

9 Fortune: Fake News and Bad News are Depressing the Market, December 2018 6 FINANCIAL MISINFORMATION In a related area, the impact of misinformation is another major cause of economic loss. In one sector and one country alone, fakery and financial misinformation is hurting consumers to tune of $17 billion per year in the US retirement savings sector. According to Forbes and research from the Economic Policy Institute, financial advisors supplying false and misleading information is costing at least $17 billion in the US10. This tallies with research showing than three in five Americans (63 percent) say that the spread of fake news has made it more difficult to make critical financial decisions, according to the American Institute of CPAs. This widespread financial misinformation is particularly concerning when we consider studies showing that people older than 65, with significant financial decisions to make, are the demographic which shares the most fake news.

FAKE NEWS AND PUBLIC HEALTH COSTS Cost of health epidemics spread by fake In the Democratic Republic of Congo a study news increase our projection of fake news published in The Lancet found that ‘‘nearly half costs further and across a wider geography. of respondents believed that Ebola didn’t exist Science journal, Nature, analyzing14 million or was invented to destabilize the region or to tweets found fake accounts responsible make money”. for “a disproportionate role in spreading articles from low-credibility sources”. They Alongside misleading medical advice and the conclude that “around the world, digital anti-vaxxer movement, the second contender health misinformation is having increasingly for most shared fake news stories globally, catastrophic impacts on physical health’’ concerns climate change. Here the economic both in developing countries and the G20. effects are similarly explosive. The Climate For instance, Simon Stevens, the head of Literacy and Energy Awareness Network , the NHS in the UK, has said fake news by funded by federal grants, reviewed more anti-vaxxers on social media “has fueled a than 30,000 free online resources on climate tripling in measles cases in the country’’. change and found only 700 articles were broadly accurate, on the theme of climate While, of course, the economic costs are change. Frank Niepold, a climate education decidedly secondary to the health risks coordinator at the National Oceanic and from such crises, news sources spreading Atmospheric Administration says: “There’s a lot fake stories exacerbate both. Vaccine- of information that’s out there that is broken, preventable diseases among adults, like old, misleading, not scientifically sound, not measles, costs the U.S alone nearly $9 billion sound technically.” Once again, the long term per year, showing the damage caused by economic costs of disinformation is real even misinformation. Unvaccinated individuals, if the information is not – the National Bureau in particular, drive most of that cost. No of Economic Research says failure to tackle country is immune from fake medical news climate change would yield a 7.2 percent cut to which quickly spirals out of . GDP per capita worldwide by 2100.

10 Ron Carson, Forbes October 2018, Retirement Savers are Losing $17 Billion from Fake News and Conflicts of Interest. FAKE NEWS | 2019 | NEWS FAKE https://www.forbes.com/sites/rcarson/2018/10/14/retirement-savers-are-losing-17-billion-a-year-from-fake-news-bad-

advice-conflicts-of-interest/#5e635549bec74 7 ALONE ADVANCING FAKE NEWS THE U.S. TO SPEND $200 MILLION $400 MILLION SPENT GLOBALLY found tobefalsebyfact-checkers. of rightwingitemscontainedinformation campaignperiod,approximatelythe 42% in instant-messagingplatform chats onthe viral messagesshared across 296group countries. InBrazil,asampleof11,957 USandother inthe 2% benchmarkboth study, our tobefarhigherthan andlikely Princeton the than fake newsinelections costof a muchhighermagnitudeofthe suggests Inmanycasesthis news outlets. have beennotedinacademicjournalsand insomecountries The costsofelections United States. news extendfarbeyondthe forfakepolitical The globalimplications ON FAKE POLITICAL NEWS ELECTIONS FAKE NEWS: spreading cycle. nextelection fakenewsinthe bespentpromoting will $200million assumethat wecanconservatively election, and news,andbasedonprojected political all 2020USPresidential inthe of$10billion spending levelsoffakenewshavereduced2016 campaign.Ifweassumethat toaround slightly 2%of madeup2.6percent falsearticles campaign, foundthat hard-news ofall lateinthe articles 2016US duringthe USalonein2020.APrinceton-ledstudyoffakenewsconsumption in the bespentonfakenews will thatatleast$200million wefind spending, fieldofelection In the $400 million globally.$400 million spend onadvancingfakenewshitsatleast orfake,political news ishighlymisleading together, andassumingatleast2%ofpolitical in 2019.Taking majorcountries someofthese country’s duringthe policies education election party,the and onitsimmigration particularly spreading platform online fakenewsabout boosted onan severalarticles party identified some instancesoffakenews.Australia’s Labor report havingcomedirectly across atleast Africans 97% ofKenya,Nigerians,andSouth InastudyonAfrica , aroundmisinformation. French presidential were elections basedon 2017 on onesocialnetworkaheadofthe shared links political up toaquarterofthe In France,Oxford Universityresearchers found

8 FAKE NEWS | 2019 ELECTION COSTS AND FAKE NEWS

It should be noted these costs are conservative, reflecting only basic direct costs, and the true cost extends well beyond media expenditures. If we consider the indirect and secondary costs of fake news in the electoral sphere, the price paid is likely to be far higher. These costs can contribute to loss of faith in institutions, and costs required to correct misinformation. In some cases, fake news may even lead to violence, while the flow of misleading propaganda drives out positive and constructive news causing damage to political decision-making.

Country Election spend for most recent Spend on fake news campaign (estimated)

United States $10 billion $200 million

India $7 billion (Rs 50,000 crore) $140 million

Brazil $1.7 billion (R$ 6.4 billion) $34 million

Kenya $1 billion $20 million

South Africa $133 m (R2 billion) 2.7 million

United Kingdom $54 million (£41.6m) $1m (£832,000)

Australia $41.4 m (A$60m) $828,000 (A$1.2m)

France $32.7 million (€29.3 million) $654,000 (€586,000)

Mexico $32.1 million (634 million pesos) $642,000 (12.2 million pesos)

Total: $400 million FAKE NEWS | 2019 | NEWS FAKE 9 unscientific or misleading medical news. medical ormisleading unscientific company appeared onasitediscussing strategyofL’Oréal digital ifthe $8.6billion damagetothe could seethe fake news.To takeonlyoneexample,we bypoorplacementsnextto valuations advocacy.” Fakenewscutsintothese loyalty, satisfaction, acquisition, and any business,drivinghighercustomer reputation isavaluableassetfor Brand Financeargues “astrong that undermined,throughthis fakenews. decades tobuildbrand“value”cansee way,In this brandswhichhastaken reputation. next tofakecancercures, damagingtheir cases,bigbrandshaveadvertised In other companiesacrosswell-known sectors. all websites,fueledinpartby disinformation fromannually adsrunning onextremist and inrevenueleast $235million isgenerated at Indexhasfoundthat Disinformation donotendorse.The Global content they alongsideinflammatoryandfake displayed suffered brandnameisbeing astheir Bigbrandshave dollars. advertising profitenjoy the onofferthrough siphoning aspreviouslymotivated, but mentioned, maynotonlybeideologically information Those behindwebsitespropagating BRAND EQUITY COSTS AND FAKE NEWS news-real-ads#.iorLO7gqK 11 See, CraigSilverman BuzzFeedNewsApril 4, 2017https://www.buzzfeednews.com/article/craigsilverman/fake- from networks advertising fakenewswerepublishing earningrevenue Researchthat 60websites in2017confirmed budget. asitbleedstheir sametime damaging atthe marketersreputationallynews foronline and where Thismakesfake advertise. they valuesofacompany, betweenthe dissonance want toavoidfakenewssites,creating a Most brandswouldbehorrifiedandexplicitly subject oftargeted misinformation. indirect are themselves costs,whenthey the direct see,companiesalsofaceboth shall and away from Or, pocketsofmisinformation. aswe forsuchbrands tokeep business imperative ourindustry’swith Itisa bestpractices”. carriedoutinaccordancelaboratory studies consumer or obtained duringevaluations, performance andrelevant data scientific promotional materialisbasedonproven isto“ensureidentity and advertising all that The beautybrandsaysacore partofits they get their [ad]impressions.” gettheir they real mostisthat the people.“Whatmatters traffic contentaslongthe the comesfrom in hisexperienceadnetworksdon’t care about runs fakenewssitessuchasHuzlers.com,said 11 . PabloReyes,who

10 FAKE NEWS | 2019 COSTS COSTS MANAGEMENT REPUTATION costs. not-insignificant campaignwith counter the based companyhadtomovequickly to undocumentedimmigrants.TheSeattle- givingoutfreechain wassupposedly drinks “Dreamer advertised that Day”.Here, the bogustweets against Starbucks,posting place”andbakedupacampaign “liberal Chan saidhewantedtoinflictpainona messageboard anonymousonline the 4 In August2017,forinstance,someoneon Facebookengagements. up 2.2million alone racked sued). Thesetwofakearticles electronicsclaiming the giantwasbeing Jordan quititsboard) andSamsung(falsely targeting Nike(falselyclaiming Michael global companies.Theseincludedstories storiesontop included widelydisseminated mostviewedfakestoriesof2018 the that BuzzFeedfound allegations. fighting Companies oftenfacedirect costsin estimated togrowestimated to$9.54Bby2022. reputation managementisasub-segment, market,ofwhich management /analytics Thesocialmedia time. and executive costs ofengagement, aquifer. aBrazilian privatizing Thisrequires have beenforced are they todenyclaimsthat whileCoca-Colaand Nestle discontinued, productto refute wasbeing Tide their that cases, Procter &Gamblehasbeenforced companies. Inother againsttheir information been forced tospendresources denyingfalse pastyearhundredsIn the ofcompanieshave in suchnewscycles. caughtup achieved bybrands,bigandsmall, similareconomicharmisnot inconceivable that business sawitsrevenue drop Itis byhalf. restaurant ofservinghumanmeat–the falselyaccusingaLondonIndian article businesses, afakenewssiteproduced an reputation tothe Extending oflocal

11 FAKE NEWS | 2019 THE PROBLEM POLICING problem receive funding. mounting the Fabula AI,whilecompaniestackling bought BloomsburyAIandTwitter acquired – in startupsandacquisitions news, there hasbeensignificantinvestment day. againstfake policing the with In line pieces ofcontentevery twomillion than professionals andpores globally over more Facebookemploys30,000 He addsthat Twitter reported revenue $3billion in2018. Twitter’sthan wholerevenue year’’ this – goes toward oursafetysystemsisgreater amountofourbudgetthat has saidthe CEO,MarkZuckerbergIntegrity Initiative. fact-checking organizations anditsNews community, apartnershipwith including of efforts toaddress issuesfacedbyits the famously, Facebookhaslaunchedanumber programs,literacy andenforcement. Most media Department) tonewlegislation, according$32 million Justice tothe reportMueller alonecostUStaxpayers fromextended toeverything inquiries(the fakenewsepidemichave to tacklethe Resources globaleconomy pumpedintothe investigation costs. investigation toincrease,only likely itspiraling bringingwith into fakenews.Thistrend ofenforcement is Research Agencyaspartofitsinvestigation Internet twelve ofwhomworkedforthe probeThe Mueller Russians, thirteen indicted websites offerthat to post fake verified reviews. aseriesoflawsuitsagainst hit backwith fakereviews. malicious writing Amazonhave in costsanddamagesagainstoneindividual problem, the tackling Trip advisorwon$9,300 To courtcostsin giveonlyasenseofthe announced incountriesfrom Brazil,toChina. apps andITsystemshavebeenvariously systems, Fakenewsdetection misinformation. aimed atincreasing awareness public of toprojectsCanada hasgiven$7million states recognize campaigns. disinformation into arapidalertsystemtohelpEUmember The European Commissionhasput$5.5million forEasternEuropeon a‘fakenewsfund’ alone. security.national Britain hasspent£18million manipulatedfakevideostoprotectspotting on research for foratechnologicalsolution Projects Agency(DARPA) hasspent$68million Department ofDefense AdvancedResearch Governments are alsosteppingup.TheUS

12 FAKE NEWS | 2019 BRINGING IT ALL TOGETHER As described above the cost of fake news is manifested in several ways. The most significant cost detailed above are seen in the table below.

Stock Market Losses and $39 BILLION Volatility

Financial Misinformation $17 BILLION PER YEAR in U.S alone

Reputation management $9.54 BILLION

Public Health Misinformation $9 BILLION U.S alone

Online platform $3 BILLION Safety

Political spend $400 MILLION

Brand Safety $250 MILLION

Total $78 BILLION

The costs estimates noted above, and in all cases outlined in this study, are conservative. The price of disinformation regarding health, politics, economics in much of the developing world in particular are hard to estimate. Similarly, misinformation in some nations such as Russia, China, Iran and others have geopolitical and economic costs that are significant but uncertain at this point. FAKE NEWS | 2019 | NEWS FAKE 13 INDIRECT COSTS: IN TRUST AND TRANSPARENCY Direct costs, described above, refer to the Fake news is further diminishing public trust in losses and opportunity costs imposed on specific sectors — trust in the has society by the fact that a crime or attack is dropped from 55% in 2015 to 32% in 2019.14 carried out. However, the US government Trust in peer reviews has dropped (online has suggested that to best understand the reviews were found in the UK alone to influence cost of harm, estimates should consider $26 billion a year of consumer spending each both the financial and non-monetary year)15. For instance, Trip Advisor claims 0.6% effects of harm. Such indirect costs could of its 66 million annual reviews are fake. In impact quality of life, increase fear, or 2018, 34,643 businesses out of the 8+ million change behaviour. Some researchers have locations listed on TripAdvisor received at concluded that crime’s most costly factors least one ‘‘ranking penalty’’ for encouraging or stem from these less tangible effects.13 paying for the submitting of fake reviews.16

The potential effects of fake news Other indirect costs include the effects of include undermining trust in democracy constant vigilance, energy and resources to and markets. In the US,fake news and defend against and repair damages caused misinformation has emerged in the public by campaigns of misinformation. This effort is mind as more dangerous than immigration, often diverted away from innovation, training, climate change and racism, according to corporate social responsibility and many Pew Research Center. others vital economic sources of growth. These positive economic benefits, necessary for competition and growth,are casualties in the war against fake news.

13 https://www.gao.gov/assets/700/691895.pdf 14 World Economic Forum, Fake News: What it is and How to Spot it, 06, March 2019. https://www.weforum.org/agenda/2019/03/fake-news-what-it-is-and-how-to-spot-it/ FAKE NEWS | 2019 | NEWS FAKE 15 Competition and Markets Authority: Online reviews and endorsements (2015)

16

2019 TripAdvisor Review Transparency Report 14 INVESTMENT IN FIGHTING FAKE NEWS

Twitter Buys Fabula AI $2019

Facebook Acquires Bloomsbury AI 2018

Facebook $10 million into the “Deepfake Detection Challenge" 2019 to spur detection research.

Factmata Raises $1million 2018

Userfeeds Raises $800k 2017

Logically Raises $1.2 million 2018

Britain $18 million spent on fake news fund for Eastern Europe 2019

The US Department of Defense Spends $68 million on research to fight deepfakes 2018 Advanced Research Projects Agency (DARPA)

Google Launches a global media literacy campaign for $10 million 2018

NewsGuard Raises $6M 2018

European Union Sets up a $5 million rapid alert system to help EU member states 2018 recognize disinformation campaigns.

Canada invests in campaigns $7m 2019 against fake news campaigns

Brand Protocol Raises $3M 2019

University of Washington $25,000. Training the AI for the university-created fake news 2019 detection algorithm, "Grover" FAKE NEWS | 2019 | NEWS FAKE 15 FAKE NEWS INITIATIVES GLOBALLY

UK: House of Commons Digital, Culture, Media and Sport Committee publishes inquiry and report on Disinformation and Fake News

Canada creates a “critical election incident public protocol” notifying agencies and the public about disinformationfact-checking page”

Belgium launches a website to inform people about misinformation

Spain creates a team of 100 officials to United States Mueller report costing $32 scour social media for potentially false million analyzes issues including fake news or misleading political posts. and effect on election interference In late August 2018, Chinese authorities launch an app that lets people report potential fakery.

Indonesian government has a team Brazil’s Superior Electoral Court of 70 engineers monitoring social (TSE) launches “multimedia media traffic 24 hours a day in an fact-checking page” effort to detect misinformation.

Australia sets up a security task force to guard against interference in elections FAKE NEWS | 2019 | NEWS FAKE 16 CONCLUSION The economic costs of fake news—straining In France, the gilets jaunes anti-government sectors from health, to finance and caused a surge in “fake news” with advertising—reflects the broad sweep of the false information viewed an estimated 105 menace. The spread of fake news is being million times during five months of . repeated across every country and sector in the world. closed 210 channels on YouTube it said were part of a «coordinated” attempt So long as the ad market incentivizes the to post material about protests in Hong production and fake news and it remains Kong”. Nigerian police have claimed that human nature to be reactive to news, then deaths occurred by false images and news, the global economy will continue to be at exacerbating an already tense conflict. The severe risk of harm. The disincentives to South African Police Acting national police reform point to sustained economic losses commissioner, Lt Gen Khomotso Phahlane for some time. Jerry Michalski, futurist and underlines that the spread of fake news not founder of REX, argues: “It is inexpensive “only sows panic”, but is “wasting police’s and easy for bad actors to act badly, and time and resources.” real solutions based on actual trusted relationships will take time to evolve – likely Even seemingly minor instances such as more than a decade.” Scott Shamp, a dean bad online reviews of a business product at State University, adds, “Too many or , or of a restaurant by disgruntled groups gain power through the proliferation former employee must be included in the of inaccurate or misleading information. aggregate and have an outsized impact. We When there is value in misinformation, it will think it reasonable that a global and growing rule.’’17 multitude of small costs associated with fake news, along with larger incidents are This study can only provide a glimpse at imposing a cost on the global economy of at the full scale of the epidemic affecting least $78 billion per year both traditional and emerging sectors With technology advances, and despite and economies. The fake news challenge rapid efforts at detection, the risks and costs continues to manifest itself in unforeseen of fake news will only grow. Fake news- ways economically such as bringing generated black swans may have the power additional resource strains on fundamental to destroy iconic firms and generate untold institutions such as the army, governments economy wide chaos and harm. and policing. FAKE NEWS | 2019 | NEWS FAKE

17 Pew Research Center: The future of Truth and Misinformation Online 17