April 17, 2023 MEMRI Daily Brief No. 473

Neo-Nazi Livestreamers' Lucrative Podcast Enterprise Should Face Scrutiny This Tax Season

April 17, 2023 | By Steven Stalinsky, Ph.D.*
MEMRI Daily Brief No. 473

A new class of neo-Nazi and white supremacist "content creators" is developing a significant stream of income by monetizing podcasts, and profiting from spreading hate online. To date, there has been little scrutiny – and no government intervention – in this lucrative and hateful enterprise. Tax collectors should take note.

A recent New York Times report detailed how today's content creators are "reaping riches" from their social media postings – and, according to the IRS, "owe taxes on all of it." Recent digital-ad revenue statistics show that streaming services have begun to overtake what have traditionally been the largest online ad companies, such as Google and Meta – due in large part to younger viewers who get their daily news from such platforms.

Neo-Nazis and white supremacists have been unashamedly vocal in their attacks on the IRS and their refusal to pay taxes, as part of their broader antigovernment agenda. One boasted recently on Gab that they had paid nothing in decades of owning a business and never would, and challenged authorities to do something about it. It is also known that they use cryptocurrency for tax evasion.

Another Gab user who is a "Three Percenter" adherent and antigovernment extremists recently posted a meme which included a call for tax evasion. In a image captioned, "Things You Don’t Need To feel Guilty For" – "Tax Evasion" is highlighted.

There are precedents of popular podcasters and streamers getting caught not paying taxes. The Twitch platform banned scores of users in the Middle East amid a tax evasion scandal, and in China many were fined for the same reason.

Highly profitable podcasts and livestreams are now part of the extremist ecosystem's increasingly sophisticated use of technology, including cryptocurrency, encryption, bots, and even moves towards using artificial intelligence. It has also become central to their outreach and recruitment efforts, openly spreading venomous hate and calls for violence as they hide behind the First Amendment – and these efforts, despite their claims, are not lawful or protected speech – they are, in many cases, federal crimes.

Earlier this year, the threat of extremist "content creation" across online platforms was underlined by Department of Homeland Security Secretary Alejandro Mayorkas at a House Homeland Security meeting: "Emerging technology platforms allow individuals and nation states to fan the flames of hate and personal grievances to large audiences, and are encouraging people to commit violent acts."

This is best explained by neo-Nazis themselves. The American Futurist, affiliated with the terrorist group Atomwaffen Division – now the National Socialist Orderlivestreamed an interview in April with James Mason, a designated terrorist and author of Siege, a vital text in neo-Nazi literature widely circulated online. In the livestream, Mason called the Internet "the greatest thing... to ever come along." He had "never dreamed," he said, of "reaching [all] these people" who can now be radicalized online.

While some producers of this extreme content are almost mainstream in tone – serving as a gateway – others disseminate the most horrific content daily on mainstream platforms such as Spotify, and on ones that they develop themselves after tiring of being deplatformed: Cozy TV, Shing TV, Goyim TV, and others. They also charge to view on them, and sell their branded tees, hats, stickers, and other items, accepting payment in cryptocurrency. They are not named here, in order to deprive them of the media attention they crave.

Direct solicitation during livestreams and podcasts is bringing in a major, and growing, income stream for hate groups. Favored platforms include Gab, BitChute, and Odysee, all designed to facilitate fundraising. Another favorite, used by many of the most prominent neo-Nazi and white supremacist figures, is the streaming and monetization platform Entropy, hosted by Microsoft Azure. Fans pay to send the streamers "super chats" to appear during the stream, for a live response.

Early on, neo-Nazi pioneers in livestream fundraising showcased videos of themselves harassing and verbally abusing Jewish and Black teens on the video platform Omegle; today, many of the platforms they use allow viewers to see a tally of donations, as streamers thank donors by name – thus encouraging them to give even more. It is known that some of these extremists can bring in as much as $10,000 in a single month – and if that is a typical month, they are making over $100,000 a year through these efforts alone.

The flow of funds to these extremists – who thrive online despite being cut off from traditional financial services following the January 6 Capitol insurrection – should be examined and ultimately stopped. This can begin with investigating, for all hate groups, what taxes, if any, are being paid on their livestream and podcast income.

While donations to them are not taxable if they are gifts with nothing provided in return, funds used for business purposes or considered income for the recipient are taxable. It is doubtful that the livestreaming and podcasting extremists in this niche industry are updating the IRS about this income. This tax season authorities should be scrutinizing the flow of extremist funds taking place online.

*Steven Stalinsky is Executive Director of MEMRI (Middle East Media Research Institute)

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