A mysterious $500,000 Bitcoin transfer. Online stores selling sham nutritional supplements and buckets of protein powder. Inane, live-streamed video game sessions, full of dog whistles and racial slurs, fed by a steady flow of cryptocurrency donations in the form of virtual lemons.
Some of the income streams exploited by America’s extremist movements have come under increased scrutiny after last month’s attack on the U.S. Capitol, for which some far-right extremists fundraised online.
Even as extremists are removed from platforms that serve as reliable sources of followers and money, they find new ways to wring financial support from an army of online haters.
“A good analogy is that for every five people who would buy a $20 T-shirt, there’s probably 500 people who would pay a dollar or 50 cents to their favorite streamer to hear them say the N-word or mock minorities online,” said Megan Squire, a computer science professor at Elon University who has studied how extremists fundraise online. “The numbers are substantially larger, both in the number of people participating and the number of times they donate.”
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Hate groups move from selling CDs to taking PayPal
In the 1980s and 1990s, when hate groups operated exclusively on terra firma, they raised money three ways: selling music and merchandise like T-shirts, holding events like concerts, and charging members annual or monthly dues, said Heidi Beirich, chief strategy officer of the Global Project Against Hate and Extremism. She has tracked extremist organizations for more than 20 years.
Those were lucrative times for hate groups, Beirich said. The music trade, especially, brought in a lot of money for American groups that exported cassette tapes and CDs to skinheads and other extremists in Europe, where hate-filled music was banned in many countries.
“The Americans would ship it into Europe and it was like an illicit product, so it had a premium,” Beirich said. “The music business was so profitable that Europol put out a study in the late ’90s saying that it rivaled the hashish trade in Europe.”
In the mid-2000s, hate groups largely shifted online and discovered PayPal and Amazon, Beirich said. For more than a decade, just about every extremist group’s website featured a PayPal button, she said. Many extremist organizations posted Amazon links on their websites, which kicked back money for every dollar their followers spent after clicking through.
That was the heyday of online fundraising for groups like the white supremacist organization American Renaissance, Beirich said. But online platforms started clamping down on extremists in about 2015. By August 2017, PayPal, GoFundMe and other payment processors had begun banning people associated with far-right extremism and white supremacy.
That month, the deadly white supremacist rally in Charlottesville, Virginia, opened many Americans’ eyes to the far-right movement feeding off the election of President Donald Trump. Spurred by images of white supremacists chanting “Jews will not replace us” in the center of an American city, platforms that had started targeting individuals and groups who spread hate accelerated their efforts.
“I remember the year before Charlottesville, I went to the DC offices of PayPal with a PowerPoint showing screenshots of all the hate groups — Klan groups, Nazis, everything, and how they all had PayPal accounts and the guy at the time was like, ‘I don’t see what the problem is.’” Beirich said. “Well, the Tuesday after Charlottesville, we got a call from the general counsel at PayPal saying, ‘What do we need to do?’”
A spokesman for PayPal disputed Beirich’s account and said the company took extremist fundraising seriously for years before Charlottesville.
“PayPal has a longstanding and consistently enforced…