Lawsuits Against Facebook Growing

Posted on March 28, 2018March 28, 2018 by Denise Simon

Lauren Price has been on Facebook (FB) for eight years and claims she frequently saw political ads on the social network during the 2016 election. She is suing the companies on behalf of other US Facebook members whose information was also collected by Cambridge Analytica, a data firm that worked with the Trump campaign.

The proposed class-action lawsuit was filed Tuesday at the US District Court in San Jose, California. Price is seeking unspecified damages.

This is the first lawsuit brought by a Facebook user over the Cambridge Analytica news, but others are likely to follow. The lawsuit is part of a growing backlash against both companies.

On Tuesday, Facebook (FB) investor Fan Yuan filed a lawsuit against the company in federal court on behalf of other investors. The suit claims Facebook made “misleading statements” and neglected to disclose details about third-party access to data, which caused the company’s stock price to fall significantly.

Price’s complaint adds that the companies have violated the privacy of million of people in the U.S. alone, and that users now have a higher risk of identity theft as a result.

“There’s going to be a lot of litigation flowing from this,” said attorney Jay Edelson of Edelson PC in Chicago. He is not involved with either case, but his firm does plan on filing related lawsuits in the near future.

“The most direct liability is against Cambridge Analytica. We believe they have violated a host of city, state, and federal laws,” said Edelson. “The case against Facebook is less direct. On the surface, many believe that Facebook acted, perhaps, negligently. We believe we will be able to provide more context to how Cambridge Analytica fits Facebook’s overall business model.” More here from CNN.

*** Facebook Hit with Lawsuit Alleging Privacy Wrongs | PCWorld photo

SAN FRANCISCO

Civil rights groups filed a federal lawsuit Tuesday against Facebook for enabling housing discrimination.

The housing rights activists, led by the National Fair Housing Alliance (NFHA), alleged that Facebook’s ad practices allow landlords and real estate agents to avoid serving housing ads to certain groups of people. The NFHA said landlords are able to avoid showing housing ads to women and families, for example.

“Amid growing public concern in the past weeks that Facebook has mishandled users’ data, our investigation shows that Facebook also allows and even encourages its paid advertisers to discriminate using its vast trove of personal data,” Lisa Rice, NFHA’s president and CEO, said in a statement.

“Facebook’s use and abuse of user data for discriminatory purposes needs to stop. It is already a challenge for women, families with children, people with disabilities and other under-served groups to find housing.”

Earlier this month, it was revealed that a political consultancy group was able to exploit Facebook user data on behalf of the 2016 presidential campaign for Donald Trump. Facebook chief executive Mark Zuckerberg personally apologized, but the social media giant has remained mired in controversy regarding how third parties can access user data.

Shares of Facebook dropped another 4.9 percent Tuesday to close at $152.22. Since the data breach was widely publicized on March 17, the stock has plummeted 18 percent.

The federal lawsuit filed by NFHA alleged that the way Facebook’s ad service is built allows for discrimination when it comes to housing. Landlords can choose not to show ads to certain groups of people based on gender, family status and a series of other qualities.

“Facebook’s platform that excludes these consumers from ever seeing certain ads to rent or buy housing must be changed immediately,” Rice continued.

“Facebook ought to be opening doors to housing opportunities instead of closing them.”

Facebook has not released any comments on the NFHA lawsuit.

Congress Calls for Hearing with Facebook, Twitter and Google

Posted on March 26, 2018March 26, 2018 by Denise Simon

While Cambridge Analytica has a proven shady history as noted below, Facebook has already admitted guilt and offered apologies when it comes to safeguarding private user information and interactions. So, when it comes to social media Facebook, Google and Twitter hold the power. Instagram and SnapChat are quite popular but do not hold the volume of data in comparison.

Now the FTC comes knocking at the door of Facebook.

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The stuff you share and the inferences Facebook makes about you are packaged together with similar people’s data, stripped of names and sold to companies. That allows businesses to put ads in front of people they’re certain they can influence.

On Facebook, you are the product. Advertisers are the customer.

Facebook’s not alone. Most advertiser-supported networks sell some of your information to third parties. Google, Microsoft, Yahoo, AOL, Amazon, Twitter and Yelp do the same.

Giving up our privacy is the price we pay for getting to use Facebook for free. Most of the time, that tradeoff works: People take advantage of free services by posting, searching and sharing. Most companies that collect our data use it for legitimate purposes and within the bounds that companies like Facebook permit.

That arrangement has turned Facebook (FB) and Google (GOOGL) into online advertising juggernauts. They have built massive audiences of billions of customers, and advertisers flock to them. Facebook and Google control three-quarters of the $83 billion digital advertising market in the United States, according to eMarketer.

But the customer-is-the-product deal doesn’t always work to the user’s advantage. This weekend, the public learned data company Cambridge Analytica improperly accessed 50 million Facebook users’ personal information to influence the 2016 election.

Internet companies have a financial disincentive to give users more control over their data. If people share less, social networks will earn less money. More here.

In part from Bloomberg:

Fake News

Bell Pottinger’s tactics included producing phony television news reports as well as fake terrorist propaganda videos containing computer code that allowed Western intelligence agencies to track anyone who watched, according to a 2016 report from the London-based Bureau of Investigative Journalism, a not-for-profit reporting organization.

The man who awarded Turnbull’s Bell Pottinger unit its first Iraq contract was Ian Tunnicliffe, then a British colonel who was running strategic communications for the U.K. defense ministry. Tunnicliffe, now retired, has been a member of SCL’s advisory board. He didn’t respond to emails seeking comment.

SCL also stoked ethnic tensions in Eastern Europe and sprayed fake graffiti in the Caribbean, according to the firm’s own sales documents. Its defense business claims in pitch documents to have worked for clients as wide-ranging as the Libyan National Transitional Council, NATO and the U.K. Foreign Office. It says it worked in Pakistan for the U.S. Department of Defense and the U.S. Pacific Command in India on countering radicalization.

SCL recently signed a contract with the U.S. State Department for market research and public-opinion polling, according to a federal procurement database. The one-year contract, signed last week, is worth $496,232, according to the database.

Deep Ties

The firm also has deep ties to the British defense establishment and Conservative Party. Its first chairman was Geoffrey Pattie, a defense minister under Margaret Thatcher. In addition to Tunnicliffe, the advisory board has included retired Rear Admiral John Tolhurst and Ivar Mountbatten, the great-nephew of Louis Mountbatten, the military hero and Queen Elizabeth’s cousin. Jonathan Marland, a former Conservative Party treasurer who served as a minister for business under former Prime Minister David Cameron, is a shareholder.

Marland told the Guardian newspaper he hadn’t had a role in running SCL following his initial investment and had refused requests to introduce the firm to Conservative Party officials.

Roger Gabb, a former British Army officer who later made his fortune as a wine distributor and wholesaler, is also a major SCL shareholder. A founding director who, with his family, still controls about 25 percent of the firm’s shares, Gabb has also been active in the Conservative Party and the campaign for the U.K. to leave the European Union. He donated 500,000 pounds ($705,300) to the party in 2006. In 2016, he was fined 1,000 pounds by the U.K.’s Electoral Commission for failing to disclose that he had helped purchase local newspaper advertisements supporting the leave side in the Brexit referendum. More here.

FB’s Zuckerberg Apologizes, Privacy Protection not Solved

Posted on March 22, 2018March 22, 2018 by Denise Simon

Just how literate are you about social media platforms and the use of your keystrokes/interaction on Facebook?

Zuckerberg hopes you are not too literate regarding your data on Facebook and he says he is sorry, wont happen again….really? Media even uses the trending hashtags for their headlines and lead news items applying their own political twist. How about those apps you keep installing? Danger zone? yup…

Everything you do on Facebook is sold elsewhere and other platforms such as Twitter or Instagram is a database and being analyzed. The revenue for these social media companies comes from selling you and you cannot opt out unless you divorce yourself from the relationship and go back to old fashioned communications. Well sorta…

Paul Ford penned an interesting solution below that should begin an interesting debate…

Silicon Valley Has Failed to Protect Our Data. Here’s How to Fix It

It’s time for a digital protection agency. It’s clear ethics don’t scale, and it’s not just Facebook’s problem.

By Paul Ford

Illustration: Sally Thurer for Bloomberg Businessweek

Over and over in the last 20 years we’ve watched low-cost or free internet communications platforms spring from the good intentions or social curiosity of tech folk. We’ve watched as these platforms expanded in power and significance, selling their influence to advertisers. Twitter, Facebook, LinkedIn, Google—they grew so fast. One day they’re a lovable new way to see kid pix, next thing you know they’re reconfiguring democracy, governance, and business.

Facebook’s recent debacle is illustrative. It turns out that the company let a researcher spider through its social network to gather information on 50 million people. Then the Steve Bannon-affiliated, Robert Mercer-backed U.K. data analysis firm Cambridge Analytica used that data to target likely Trump voters. Facebook responded that, no, this was not a “breach.”

OK, sure, let’s not call it a breach. It’s how things were designed to work. That’s the problem.

For years we’ve been talking and thinking about social networks as interesting tools to model and understand human dynamics. But it’s no longer academic—Facebook has reached a scale where it’s not a model of society as much as an engine of culture. A researcher gained legitimate access to the platform and then just … kept going, and Cambridge Analytica ended up with those 50 million profiles. The “hack” was a true judo move that used the very nature of the platform against itself—like if you gave MacGyver a phone book and he somehow made it into a bomb.

What’s been unfolding for a while now is a rolling catastrophe so obvious we forget it’s happening. Private data are spilling out of banks, credit-rating providers, email providers, and social networks and ending up everywhere.

So this is an era of breaches and violations and stolen identities. Big companies can react nimbly when they fear regulation is actually on the horizon—for example, Google, Facebook, and Twitter have agreed to share data with researchers who are tracking disinformation, the result of a European Union commission on fake news. But for the most part we’re dealing with global entities that own the means whereby politicians garner votes, have vast access to capital to fund lobbying efforts, and are constitutionally certain of their own moral cause. That their platforms are used for awful ends is just a side effect on the way to global transparency, and shame on us for not seeing that.

So are we doomed to let them take our data or that of our loved ones and then to watch as that same data is used against us or shared by hackers? Yes, frankly. We’re doomed. Equifax Inc. sure won’t save us. Do we trust Congress to bring change? Do we trust Congress to plug in a phone charger? I’ll be overjoyed to find out I’m wrong. In the meantime, turn on two-factor authentication everywhere (ideally using a hardware dongle like a YubiKey), invest in a password manager, and hold on tight.

The word “leak” is right. Our sense of control over our own destinies is being challenged by these leaks. Giant internet platforms are poisoning the commons. They’ve automated it. Take a non-Facebook case: YouTube. It has users who love conspiracy videos, and YouTube takes that love as a sign that more and more people would love those videos, too. Love all around! In February an ex-employee tweeted: “The algorithm I worked on at Google recommended [InfoWars personality and lunatic conspiracy-theory purveyor] Alex Jones’ videos more than 15,000,000,000 times, to some of the most vulnerable people in the nation.”

The head of YouTube, Susan Wojcicki, recently told a crowd at SXSW that YouTube would start posting Wikipedia’s explanatory text next to conspiracy videos (like those calling a teen who survived the Parkland, Fla., shooting a “crisis actor”). Google apparently didn’t tell Wikipedia about this plan.

The activist and internet entrepreneur Maciej Ceglowski once described big data as “a bunch of radioactive, toxic sludge that we don’t know how to handle.” Maybe we should think about Google and Facebook as the new polluters. Their imperative is to grow! They create jobs! They pay taxes, sort of! In the meantime, they’re dumping trillions of units of toxic brain poison into our public-thinking reservoir. Then they mop it up with Wikipedia or send out a message that reads, “We take your privacy seriously.”

Given that the federal government is currently one angry man with nuclear weapons and a Twitter account, and that it’s futile to expect reform or self-regulation from internet giants, I’d like to propose something that will seem impossible but I would argue isn’t: Let’s make a digital Environmental Protection Agency. Call it the Digital Protection Agency. Its job would be to clean up toxic data spills, educate the public, and calibrate and levy fines.

How might a digital EPA function? Well, it could do some of the work that individuals do today. For example, the website of Australian security expert Troy Hunt, haveibeenpwned.com (“pwned” is how elite, or “l33t,” hackers, or “hax0rs,” spell “owned”), keeps track of nearly 5 billion hacked accounts. You give it your email, and it tells you if you’ve been found in a data breach. A federal agency could and should do that work, not just one very smart Australian—and it could do even better, because it would have a framework for legally exploring, copying, and dealing with illegally obtained information. Yes, we’d probably have to pay Booz Allen or Accenture or whatever about $120 million to get the same work done that Troy Hunt does on his own, but that’s the nature of government contracting, and we can only change one thing at a time.

When it comes to toxic data spills, it’s hard to know just how exposed you are. Literally all of us have been hacked—hard and a lot and mostly behind our backs. At least we could start to understand how bad it is. We could teach high school students to check the DPA site, to manage their own breaches. You’d go to the website to get good information about recovering from identity theft or a new social security number (we should also get rid of social security numbers as identification, but that’s another subject). It would have the forms you need to restore your identity, assert that you’d been hacked, and protect yourself. A nice thing for a government to do.

Let’s keep going! Imagine ranking banks and services by the number of data breaches they’ve experienced. Or a national standard for disclosure of how our private information is shared. (These ideas have been floated before in lots of different forms; the point is, how nice would it be if there was one government agency insisting on it in the same way that we have nutrition labels and calorie counts on our packaged foods?) The Consumer Financial Protection Bureau was headed in this direction—if it can survive the current maelstrom, maybe its mandate could be expanded.

So: Lots of helpful information, plenty of infographics, a way to track just how badly you’ve been screwed, and, ideally, some teeth—the DPA needs to be able to impose fines. I’m sure there’d be some fuss and opposition, but, come on. The giants have so much money it would hardly matter. And consider this from their perspective: How much better will it be to have your lawyers negotiate with the DPA’s lawyers instead of being hauled before Congress every time someone blows a whistle on your breaches?

The EPA’s budget is more than $8 billion, a little on the high side for the digital version. You could pull this off with $15 million or $20 million for tech infrastructure and to support a team—four engineers to build the platform, some designers, and then a few dozen graphic artists to make the charts and tables. Add on $2 billion for management and lawyers, and you’ve got yourself a federal agency.

I know that when you think of a Superfund site, you think of bad things, like piles of dead wildlife or stretches of fenced-off, chemical-infused land or hospital wings filled with poisoned families. No one thinks about all the great chemicals that get produced, or the amazing consumer products we all enjoy. Nobody sets out to destroy the environment; they just want to make synthetic fibers or produce industrial chemicals. The same goes for our giant tech platforms. Facebook never expected to be an engine that destroys America. Lots of nice people work there. Twitter didn’t expect to become the megaphone of despots and white nationalists. But the simple principles of “more communication is better” and “let’s build community” and “we take your privacy seriously” didn’t stand a chance under the pressure of hypergrowth and unbelievable wealth creation.

Unfortunately, ethics don’t scale as well as systems. We’ve poisoned ourselves, and more than a little. Given the money and power at stake, it’s going to be hard to get everyone to admit we’re sick. But we owe ourselves—and, cliché though it may be, we owe our children—to be more pragmatic about treating the symptoms.

Facebook, Artificial Intelligence Op, Manipulating You

Posted on March 19, 2018March 19, 2018 by Denise Simon

Is any of this illegal? Well, yet to be determined because no one asks the questions, much less do we know what questions to ask….

It boils down to this: ‘facts don’t matter, it is what readers believe’ or as is in A Few Good Men, a dream world is it does not matter what I believe, it matters what I can prove. Artificial intelligence is proven, believed and kinda sorta factual?

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Facebook says it has saved more than $2 billion from its investments in Open Compute. But five years is an eternity on the Internet, and now every big tech company is out to conquer a different problem. Serving up content cheaply can be done, but figuring out what kind of content to serve among billions of posts is still a challenge. So, just as Facebook set out to rebuild the hardware industry half a decade ago with the Open Compute project, it has more recently created an internal platform to harness artificial intelligence so it can deliver exactly the content you want to see. And it wants to build this “machine learning” platform to scale. (“Machine learning” is a form of artificial intelligence that allows computers to learn how to operate without being pre-programmed.) “We’re trying to build more than 1.5 billion AI agents—one for every person who uses Facebook or any of its products,” says Joaquin Candela, the head of the newly created Applied Machine Learning group. “So how the hell do you do that?”

FBLearner Flow combines several machine-learning models to process several billion data points, drawn from the activity of the site’s 1.5 billion users, and forms predictions about thousands of things: which user is in a photograph, which message is likely to be spam. The algorithms created from FBLearner Flow’s models help define what content appears in your News Feed and what advertisements you see.

It would be easy to jump to the conclusion that Facebook’s use of artificial intelligence will help eliminate some of the company’s 13,000 employees. The reality couldn’t be more different, says chief technology officer Mike Schroepfer. AI is helping Facebook augment the capabilities of its human engineers. “We’re able to do things that we have not able to do before,” he says. More here.

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Stop clicking the bait on Facebook, you are participating in psychometic testing for Facebook.

Predicting individual traits and attributes based on various cues, such as samples of written text (8), answers to a psychometric test (9), or the appearance of spaces people inhabit (10), has a long history. Human migration to digital environment renders it possible to base such predictions on digital records of human behavior. It has been shown that age, gender, occupation, education level, and even personality can be predicted from people’s Web site browsing logs (11 ⇓⇓⇓–15). Similarly, it has been shown that personality can be predicted based on the contents of personal Web sites (16), music collections (17), properties of Facebook or Twitter profiles such as the number of friends or the density of friendship networks (18 ⇓⇓–21), or language used by their users (22). Furthermore, location within a friendship network at Facebook was shown to be predictive of sexual orientation (23).

This study demonstrates the degree to which relatively basic digital records of human behavior can be used to automatically and accurately estimate a wide range of personal attributes that people would typically assume to be private. The study is based on Facebook Likes, a mechanism used by Facebook users to express their positive association with (or “Like”) online content, such as photos, friends’ status updates, Facebook pages of products, sports, musicians, books, restaurants, or popular Web sites. Likes represent a very generic class of digital records, similar to Web search queries, Web browsing histories, and credit card purchases. For example, observing users’ Likes related to music provides similar information to observing records of songs listened to online, songs and artists searched for using a Web search engine, or subscriptions to related Twitter channels. In contrast to these other sources of information, Facebook Likes are unusual in that they are currently publicly available by default. However, those other digital records are still available to numerous parties (e.g., governments, developers of Web browsers, search engines, or Facebook applications), and, hence, similar predictions are unlikely to be limited to the Facebook environment. More here.

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So why does Facebook feel like it is a victim of Cambridge Analytica? Well it seems Cambridge Analytica was a customer of Facebook and bought customer data for their own use. Facebook feels betrayed but how about that relationship? Facebook censors and mines data for their own political missions and frankly Cambridge Analytica does the same thing. These two companies along with several others and hired outside data and espionage types are changing the whole balance and equilibrium of the globe, question is to what end?

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The data company that helped push Donald Trump to victory is now hoping it will win two lucrative contracts to boost White House policy messaging and to expand sales for the Trump Organization.

Cambridge Analytica, a data mining firm that uses personality profiling, claims Steve Bannon as a board member, who will soon officially be Mr Trump’s chief strategist.

The firm is backed by billionaire investor Robert Mercer, whose daughter Rebekah sits on the 16-person Trump transition team.

The London-based firm said it has marketing and psychological data on around 230 million Americans, which could help Mr Trump to increase his real estate business, or scope out the policy landscape for his government. More here.

In case you are wondering about global opposition research and affecting power to power with global leaders, check out this video:

Now this cat may appear to be quite an odd whistleblower but….

Christopher Wylie, who worked for data firm Cambridge Analytica, reveals how personal information was taken without authorisation in early 2014 to build a system that could profile individual US voters in order to target them with personalised political advertisements. At the time the company was owned by the hedge fund billionaire Robert Mercer, and headed at the time by Donald Trump’s key adviser, Steve Bannon. Its CEO is Alexander Nix.

When Biden and Kerry Concocted a Shady Equity Firm

Posted on March 19, 2018March 19, 2018 by Denise Simon

Keep this post in your bookmarks as we enter into the 2020 general election….

Primer:

1. China plants industrial espionage operatives in the U.S. that steal government contract secrets and sell them back to China. FBI caught at least one.

2. Through cyber espionage, China has stolen much of the F-35 technology, more than 50 terabytes.

3. John Kerry and Joe Biden did exactly the same thing as Hillary…sold access for money while exploiting it all as diplomatic missions with the title(s) of bi-lateral agreements.

4. Subpoena former Treasury Secretary Jack Lew and ask him about the CFIUS approvals of Chinese back enterprises. We may surely need to go back to former Treasury Secretary, Tim Geithner, did he set the table for all this with Obama’s approval creating that ‘Asia Pivot‘?

5. What does Congress know about foreign investments and when do they know it? They get reports, but who is asking questions, anyone?

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NYP: Joe Biden and John Kerry have been pillars of the Washington establishment for more than 30 years. Biden is one of the most popular politicians in our nation’s capital.

His demeanor, sense of humor, and even his friendly gaffes have allowed him to form close relationships with both Democrats and Republicans. His public image is built around his “Lunch Bucket Joe” persona. As he reminds the American people on regular occasions, he has little wealth to show for his career, despite having reached the vice presidency.

One of his closest political allies in Washington is former senator and former Secretary of State John Kerry. “Lunch Bucket Joe” he ain’t; Kerry is more patrician than earthy. But the two men became close while serving for several decades together in the US Senate. The two “often talked on matters of foreign policy,” says Jules Witcover in his Biden biography.

So their sons going into business together in June 2009 was not exactly a bolt out of the blue.

But with whom their sons cut lucrative deals while the elder two were steering the ship of state is more of a surprise.

What Hunter Biden, the son of America’s vice president, and Christopher Heinz, the stepson of the chairman of the Senate Committee on Foreign Relations (later to be secretary of state), were creating was an international private equity firm. It was anchored by the Heinz family alternative investment fund, Rosemont Capital. The new firm would be populated by political loyalists and positioned to strike profitable deals overseas with foreign governments and officials with whom the US government was negotiating.

Hunter Biden, Vice President Joe Biden’s youngest son, had gone through a series of jobs since graduating from Yale Law School in 1996, including the hedge-fund business.

By the summer of 2009, the 39-year-old Hunter joined forces with the son of another powerful figure in American politics, Chris Heinz. Senator John Heinz of Pennsylvania had tragically died in a 1991 airplane crash when Chris was 18. Chris, his brothers, and his mother inherited a large chunk of the family’s vast ketchup fortune, including a network of investment funds and a Pennsylvania estate, among other properties. In May 1995, his mother, Teresa, married Senator John Kerry of Massachusetts. That same year, Chris graduated from Yale, and then went on to get his MBA from Harvard Business School.

Joining them in the Rosemont venture was Devon Archer, a longtime Heinz and Kerry friend.

The three friends established a series of related LLCs. The trunk of the tree was Rosemont Capital, the alternative investment fund of the Heinz Family Office. Rosemont Farm is the name of the Heinz family’s 90-acre estate outside Fox Chapel, Pennsylvania.

The small fund grew quickly. According to an email revealed as part of a Securities and Exchange Commission investigation, Rosemont described themselves as “a $2.4 billion private equity firm co-owned by Hunter Biden and Chris Heinz,” with Devon Archer as “Managing Partner.”

The partners attached several branches to the Rosemont Capital trunk, including Rosemont Seneca Partners, LLC, Rosemont Seneca Technology Partners, and Rosemont Realty.

Of the various deals in which these Rosemont entities were involved, one of the largest and most troubling concerns was Rosemont Seneca Partners.

Rather than set up shop in New York City, the financial capital of the world, Rosemont Seneca leased space in Washington, DC. They occupied an all-brick building on Wisconsin Avenue, the main thoroughfare of exclusive Georgetown. Their offices would be less than a mile from John and Teresa Kerry’s 23-room Georgetown mansion, and just two miles from both Joe Biden’s office in the White House and his residence at the Naval Observatory.

Over the next seven years, as both Joe Biden and John Kerry negotiated sensitive and high-stakes deals with foreign governments, Rosemont entities secured a series of exclusive deals often with those same foreign governments.

Some of the deals they secured may remain hidden. These Rosemont entities are, after all, within a private equity firm and as such are not required to report or disclose their financial dealings publicly.

Some of their transactions are nevertheless traceable by investigating world capital markets. A troubling pattern emerges from this research, showing how profitable deals were struck with foreign governments on the heels of crucial diplomatic missions carried out by their powerful fathers. Often those foreign entities gained favorable policy actions from the United States government just as the sons were securing favorable financial deals from those same entities.

Nowhere is that more true than in their commercial dealings with Chinese government-backed enterprises.

Rosemont Seneca joined forces in doing business in China with another politically connected consultancy called the Thornton Group. The Massachusetts-based firm is headed by James Bulger, the nephew of the notorious mob hitman James “Whitey” Bulger. Whitey was the leader of the Winter Hill Gang, part of the South Boston mafia. Under indictment for 19 murders, he disappeared. He was later arrested, tried, and convicted.

James Bulger’s father, Whitey’s younger brother, Billy Bulger, serves on the board of directors of the Thornton Group. He was the longtime leader of the Massachusetts state Senate and, with their long overlap by state and by party, a political ally of Massachusetts Senator John Kerry.

Less than a year after opening Rosemont Seneca’s doors, Hunter Biden and Devon Archer were in China, having secured access at the highest levels. Thornton Group’s account of the meeting on their Chinese-language website was telling: Chinese executives “extended their warm welcome” to the “Thornton Group, with its US partner Rosemont Seneca chairman Hunter Biden (second son of the now Vice President Joe Biden).”

The purpose of the meetings was to “explore the possibility of commercial cooperation and opportunity.” Curiously, details about the meeting do not appear on their English-language website.

Also, according to the Thornton Group, the three Americans met with the largest and most powerful government fund leaders in China — even though Rosemont was both new and small.

The timing of this meeting was also curious. It occurred just hours before Hunter Biden’s father, the vice president, met with Chinese President Hu in Washington as part of the Nuclear Security Summit.

There was a second known meeting with many of the same Chinese financial titans in Taiwan in May 2011. For a small firm like Rosemont Seneca with no track record, it was an impressive level of access to China’s largest financial players. And it was just two weeks after Joe Biden had opened up the US-China strategic dialogue with Chinese officials in Washington.

On one of the first days of December 2013, Hunter Biden was jetting across the Pacific Ocean aboard Air Force Two with his father and daughter Finnegan. The vice president was heading to Asia on an extended official trip. Tensions in the region were on the rise.

The American delegation was visiting Japan, China, and South Korea. But it was the visit to China that had the most potential to generate conflict and controversy. The Obama administration had instituted the “Asia Pivot” in its international strategy, shifting attention away from Europe and toward Asia, where China was flexing its muscles.

For Hunter Biden, the trip coincided with a major deal that Rosemont Seneca was striking with the state-owned Bank of China. From his perspective, the timing couldn’t have been better.

Vice President Biden, Hunter Biden and Finnegan arrived to a red carpet and a delegation of Chinese officials. Greeted by Chinese children carrying flowers, the delegation was then whisked to a meeting with Vice President Li Yuanchao and talks with President Xi Jinping.

Hunter and Finnegan Biden joined the vice president for tea with US Ambassador Gary Locke at the Liu Xian Guan Teahouse in the Dongcheng District in Beijing. Where Hunter Biden spent the rest of his time on the trip remains largely a mystery. There are actually more reports of his daughter Finnegan’s activities than his.

What was not reported was the deal that Hunter was securing. Rosemont Seneca Partners had been negotiating an exclusive deal with Chinese officials, which they signed approximately 10 days after Hunter visited China with his father. The most powerful financial institution in China, the government’s Bank of China, was setting up a joint venture with Rosemont Seneca.

The Bank of China is an enormously powerful financial institution. But the Bank of China is very different from the Bank of America. The Bank of China is government-owned, which means that its role as a bank blurs into its role as a tool of the government. The Bank of China provides capital for “China’s economic statecraft,” as scholar James Reilly puts it. Bank loans and deals often occur within the context of a government goal.

Rosemont Seneca and the Bank of China created a $1 billion investment fund called Bohai Harvest RST (BHR), a name that reflected who was involved. Bohai (or Bo Hai), the innermost gulf of the Yellow Sea, was a reference to the Chinese stake in the company. The “RS” referred to Rosemont Seneca. The “T” was Thornton.

The fund enjoyed an unusual and special status in China. BHR touted its “unique Sino-US shareholding structure” and “the global resources and network” that allowed it to secure investment “opportunities.” Funds were backed by the Chinese government.

In short, the Chinese government was literally funding a business that it co-owned along with the sons of two of America’s most powerful decision makers.

The partnership between American princelings and the Chinese government was just a beginning. The actual investment deals that this partnership made were even more problematic. Many of them would have serious national security implications for the United States.

In 2015, BHR joined forces with the automotive subsidiary of the Chinese state-owned military aviation contractor Aviation Industry Corporation of China (AVIC) to buy American “dual-use” parts manufacturer Henniges.

AVIC is a major military contractor in China. It operates “under the direct control of the State Council” and produces a wide array of fighter and bomber aircraft, transports, and drones — primarily designed to compete with the United States.

The company also has a long history of stealing Western technology and applying it to military systems. The year before BHR joined with AVIC, the Wall Street Journal reported that the aviation company had stolen technologies related to the US F-35 stealth fighter and incorporated them in their own stealth fighter, the J-31. AVIC has also been accused of stealing US drone systems and using them to produce their own.

In September 2015, when AVIC bought 51 percent of American precision-parts manufacturer Henniges, the other 49 percent was purchased by the Biden-and-Kerry-linked BHR.

Henniges is recognized as a world leader in anti-vibration technologies in the automotive industry and for its precise, state-of-the-art manufacturing capabilities. Anti-vibration technologies are considered “dual-use” because they can have a military application, according to both the State Department and Department of Commerce.

The technology is also on the restricted Commerce Control List used by the federal government to limit the exports of certain technologies. For that reason, the Henniges deal would require the approval of the Committee on Foreign Investment in the United States (CFIUS), which reviews sensitive business transactions that may have a national security implication.

According to BHR internal documents, the Henniges deal included “arduous and often-times challenging negotiations.” The CFIUS review in 2015 included representatives from numerous government agencies including John Kerry’s State Department.

The deal was approved in 2015.

Excerpted with permission from “Secret Empires: How the American Political Class Hides Corruption and Enriches Family and Friends,” by Peter Schweizer, published by Harper Collins. The book goes on sale March 20.