Why Hedge Funds Shouldn’t Own the News

Dramatic changes in news ownership have been recent and swift. Today, hedge funds control one-third of U.S. newspapers, and all four of the largest local newspaper chains are owned or managed by these poorly regulated financial institutions. Three-quarters of the top 200 newspapers by circulation are owned or controlled by hedge funds.

The FBI’s dire assessment spotlights the extreme lack of transparency already demonstrated by these companies, and in the context of local news, it has disastrous implications for democracy.

The FBI’s “law enforcement sensitive” bulletin on private equity was leaked and published online by a transparency group called Distributed Denial of Secrets, after hackers broke into law enforcement records at a Texas web development company. The contents of the leak were verified by intelligence site Krebs on Security, and the story was reported by Reuters.

Noting its assessment was made with “high confidence,” the FBI’s report says that “in the long term, criminally complicit investment fund managers likely will expand their money laundering operations as private placement opportunities increase, resulting in continued infiltration of the licit global financial system.”

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