Democracy’s Weakest Link: Foreign Money and Political Influence

Like the proverbial frog in boiling water, malign finance can insidiously corrode democratic institutions and processes until the damage becomes irreversible. This is not alarmism. As geopolitical tensions mount and authoritarianism spreads, democracies must confront an uncomfortable reality: hostile states use finance to shape the politics of open societies, often unnoticed. Foreign powers have learned that submitting a well-timed donation or funding an effective influence campaign can achieve what tanks and missiles cannot. By injecting money into political systems through opaque financial networks, authoritarian regimes can make democratic governments more pliable, divided, and less willing to confront their adversaries. The question is whether existing checks and balances are up to the task of defending democracies against this pernicious and pervasive threat. The answer is increasingly in doubt.

Global Alarm Bells

Annual assessments of global democracy paint a bleak picture of a downward spiral into democratic decline, with scholar Larry Diamond warning that the world is witnessing ‘the darkest moment for freedom in half a century’. Proponents of democracy are having to work harder than ever to defend their long-held values against a sustained onslaught by foreign powers seeking to subvert elections and policymaking processes. From election denialism in the United States in the wake of the 2020 presidential election, to China’s attempts to manipulate Australian domestic and foreign policymaking, including reported efforts to influence the 2023 Indigenous Voice referendum, foreign interference has become a constant feature of political life. In Eastern Europe, Russia’s blatant attempts to direct the outcome of Moldova’s 2024 presidential election and referendum on joining the EU show how openly authoritarian states are willing to meddle in democratic processes. Indeed in 2024, when almost half the world’s population voted, state-backed interference has been identified in at least 21 of those elections, ranging from cyber-attacks and misinformation campaigns, to the direct funding of local actors.

The threat does not stop after the election ends. A mounting number of cases have emerged of politicians being paid to parrot the talking points of states that would do us harm. In late February, UK prosecutors charged a former leader of Reform UK in Wales with receiving money on at least eight occasions to ‘make statements [in the European Parliament which] had a particular narrative that would have been seen to benefit Russia in relation to events in Ukraine’. At the same time, investigations have found that British MPs and Lords routinely accept financial benefits from foreign governments – from all-expenses-paid overseas visits, to paid advisory roles providing political and policy guidance to authoritarian states. On the continent, the investigation into the infamous 2022 ‘Qatargate’ scandal, in which Qatar, Morocco and Mauritania allegedly bribed EU officials to influence key decisions, is ongoing and continues to expose the ease with which foreign states can purchase influence in the heart of Europe.

New Tools of the Trade

Efforts to subvert elections and democratic institutions are nothing new. Both foes and allies have engaged in such practices over the decades. The Soviet Union’s ‘active measures’ campaigns to destabilise Western countries during the Cold War; the CIA and MI6-engineered coup against Iranian Prime Minister Mohammed Mossadegh; and France’s ‘Françafrique’ interventions in its former African colonies, all continue to cast long shadows today. Yet, in comparison with the labour-intensive and human-driven operations of the past, technology and modern illicit financial flows have radically lowered the barriers to entry. Hostile states can now influence elections and democratic decision-making at scale, and often in secret.

Opaque financial flows – routed through shell companies, offshore trusts and unincorporated associations – enable hostile states to discreetly fund candidates, political parties, lobbyists, academic institutions, think-tanks, and even individual influencers. This money buys far more than access, it purchases narratives. With a relatively small financial outlay, adversarial states can ensure their talking points are repeated in government chambers from Westminster to Washington, shaping legislation, nudging public opinion, and undermining public trust in democratic institutions.

Social media has supercharged this threat. Influence operations no longer rely solely on cultivating sympathetic candidates or buying television advertisements. In the digital age, foreign actors can finance an entire influence ecosystem from afar. Armies of bots can be mobilised to amplify divisive narratives, exploit polarisation, and manufacture the illusion of grassroot support for policies that align with authoritarian interests. This potent fusion of dark money and technological manipulation has created a system in which hostile states can influence not only who governs, but how Western democracies function – or fail to.

Consider the November 2024 Romanian presidential election, which was annulled after declassified intelligence suggested that Russia had weaponised hundreds of TikTok accounts to aid the first-round victory of the far-right candidate, Calin Georgescu. Similarly in Germany, a recent investigation uncovered a vast Russian disinformation campaign designed to erode public support for Ukraine. Analysts found that, over the course of a single month, more than one million German-language posts – originating from an estimated 50,000 fake accounts – flooded the social media platform X at an average rate of two posts every second.

Fighting Back

Whereas hostile states deploy digital strategies and financial influence campaigns at the speed of the internet, the response from democracies has been pedestrian at best – and negligent at worst. Qatargate has exposed just how easily foreign cash can allegedly secure favourable treatment from European lawmakers. Despite there being evidence of at least 300 apparent attempts to manipulate EU processes, the legal procedure has faced constant set-backs. In late February, the Belgium prosecutor put in a request to remove the immunity of two additional European Parliament members so that their actions could be investigated. In the UK and US, permissive political finance laws, weak enforcement and a culture of complacency have left the door wide open to foreign influence.

What can be done? First, work on strengthening responses to illicit finance must continue and all political donations, including those made outside of election periods, must be subject to full transparency requirements. The ultimate beneficial owner behind every donation, not just the last link in the chain, must be disclosed. This would close loopholes that allow shell companies and wealthy proxies to launder foreign money into politics. Second, electoral commissions around the world must be given real teeth, with investigative and enforcement powers strong enough to follow financial trails across jurisdictions and impose meaningful sanctions. For example, at present, the regulator in the UK is woefully underfunded, underpowered, and too often ignored. Things are no different elsewhere, with five former employees of the US Federal Election Commission recently highlighting how the regulator has been rendered dysfunctional and ineffective.

None of these proposals are new – over the past 15 years, numerous reports, research and inquiries have called for key electoral changes, with little success at turning recommendations into reform. However, there are now unmistakable signs of democratic backsliding that should galvanise political will to act. According to the largest and most comprehensive analysis of global democratic trust, public confidence in political institutions is in decline across most democratic countries. Voter turnout, especially among younger generations, continues to fall, raising the real possibility that future elections could lose their legitimacy because the majority of the population opt out. The reasons for voter disengagement are varied and complex. But evidence increasingly links the public’s dissatisfaction with democratic processes to perceptions that the funding of political parties, and the buying of political influence, is opaque, undemocratic and corrupt. Politicians who continue to sacrifice long-term democratic stability for short-term gain do so at their, and our, peril.

At the same time, the weaponisation of social media and AI models by foreign actors must be confronted head-on. Digital campaign spending should be fully transparent, with platforms required to maintain publicly accessible archives of all paid political content, disclosing both the source of funding and the targeting criteria. Platforms must also be held accountable for identifying and disrupting foreign influence operations, rather than leaving malign actors free to exploit algorithmic loopholes to amplify their narratives. Without such reforms, adversarial states will continue to buy, boost and distort political messaging with near impunity.

Yet legislation alone will never be enough. Regulatory frameworks are notoriously slow to adapt and struggle to keep pace with technological innovation. Democracies must therefore ensure that their citizens are equipped to critically assess the deluge of online information they now face. Digital media literacy initiatives in Finland, the US and India have helped build an increased resilience to disinformation campaigns. Technology itself can also be part of the solution. Properly deployed, AI tools can enhance cyber security, detect deepfakes, improve transparency around political financing, and help regulators monitor electoral wrongdoing in real-time.

Conclusion

The gradual erosion of democratic institutions is rarely marked by dramatic flashpoints or violent coups. More often than not, it is the product of incremental capture – the slow and steady corrosion of public trust, the subtle but persistent rewriting of political narratives, and the quiet normalisation of foreign influence. Yet democracies are not powerless. By acting now to sever the hidden financial pipelines flowing from hostile states into the heart of our political systems and the overt influence accelerated by social media, we can defend our right to open and independent governance. The frog in boiling water always has the chance to save itself, it just chooses inertia over action until it is too late. We must not make the same mistake.

© RUSI, 2025.

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