Sources

Farewell Rex, Hello Mike — Will Pompeo's Arrival Kill Iran Nuclear Deal?

Next U.S. secretary of state Mike Pompeo
Next U.S. secretary of state Mike Pompeo
Carol Morello

-Analysis-

WASHINGTON — The nomination of Mike Pompeo to be the next secretary of state signals President Donald Trump's determination to quit the landmark Iran nuclear deal, which could cause it to unravel, according to national security and arms-control experts.

If Pompeo is confirmed, Trump will have at his side an adviser who is equally as hard line on Iran and a harsh critic of the 2015 multilateral agreement between the United States and other world powers.

"Now you have the appointment of someone who has made it an article of faith that the Iran deal is a bad deal that needs to be ripped up," said Robert Malley, president of the International Crisis Group who helped broker the Iran negotiations under the Obama administration. "It may well be the first casualty of Tillerson's ousting will be the end of the Iran deal."

Pompeo has frequently expressed scorn for Iran, which he once characterized as "a thuggish police state" and a "despotic theocracy." Just before Trump named him to head the CIA, Pompeo tweeted that he looked forward to "rolling back" the nuclear deal, which he called "disastrous."

As secretary of state, it will fall to Pompeo to certify whether Iran is meeting its nuclear commitments under the deal, as required every 90 days under U.S. law.

Rex Tillerson, who was fired Tuesday as secretary of state, always concluded that Iran was complying as international monitors have reported, although not in its "spirit." He had urged the president to stay in the agreement to keep leverage over Iran's ballistic missile testing and other actions not covered under the agreement. Although they disagreed on many foreign policy issues, Trump mentioned only the Iran deal in explaining why he thought it was time for Tillerson to go.

Pompeo has frequently expressed scorn for Iran.

After Trump named Pompeo as Tillerson's replacement, Mark Dubowitz, head of the Foundation for Defense of Democracies, tweeted that Pompeo is "Exhibit A" of Trump's seriousness about walking away from the deal if there is no agreement to amend it.

"Now he has a secretary of state who 100% shares his views on the nature and gravity of the Iranian threat and the fatal flaws of the JCPOA," Dubowitz said in an interview, using the initialism for the deal's official name. "Now there is no daylight between the president and the secretary of state."

Pompeo is expected to have his confirmation hearing in April, the month before a May 12 deadline for Trump to decide whether to reimpose sanctions that were suspended in exchange for Iran's acceptance of limits on its nuclear program. However, nothing would prevent Trump from withdrawing at any time before then.

A U.S. pullback probably would kill the deal outright, even if the Europeans and other parties to the agreement strive to keep it alive. That is because other countries, businesses and financial institutions would be inclined to curb their interactions with Iran, eroding any motivation for Iran to stay in it.

Russia, another signatory to the deal, has said the agreement will collapse if one party withdraws. Some Iranian officials have said the same, although others hope to stick with it because it has ended the country's economic isolation.

But Deputy Foreign Minister Abbas Araghchi, who was a member of the Iranian negotiating team, said that "if America withdraws from the nuclear deal, Iran will follow suit," Iranian media reported.

On Monday, a spokesman for the Atomic Energy Organization of Iran said it could resume its production of highly enriched uranium, which it shelved under the deal, within two days. Ali Khorram, a former Iranian diplomat, wrote in his column in the daily newspaper Arman called Pompeo "cowboyish in character and eager to start a war similar to the war with Iraq."

Pompeo may moderate some of his criticisms of the nuclear deal if he becomes secretary.

One potential lifeline for the Iran deal comes Friday in Vienna. The United States, Britain, China, the European Union, France, Germany and Russia will meet there at the International Atomic Energy Agency headquarters for a meeting of a committee tasked with settling issues that arise.

The United States will be represented by Brian Hook, the State Department's head of policy planning. Hook has been negotiating with Europeans on possible "fixes' to the deal, primarily involving Iran's ballistic program, support for militant groups such as Hezbollah and sunset clauses that cause various limitations on Iran to expire years from now.

Those periodic meetings often are used for sideline meetings between delegations for the United States and Iran.

Some analysts believe that Pompeo may moderate some of his criticisms of the nuclear deal if he becomes secretary of state and slips into the role. As a member of Congress and then head of the CIA, his criticisms never carried the responsibility of coming up with solutions.

"The logic of the situation remains the same, no matter what Mr. Pompeo may want to do or Mr. Trump would like to do," said Daryl Kimball, head of the Arms Control Association. "It makes no sense for America to blow up the Iran nuclear deal, create a new nuclear crisis and undermine the president's new diplomatic initiative to start North Korea on the path to denuclearize. If Mike Pompeo is worth his salt, he will point this out."

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Economy

Air Next: How A Crypto Scam Collapsed On A Single Spelling Mistake

It is today a proven fraud, nailed by the French stock market watchdog: Air Next resorted to a full range of dubious practices to raise money for a blockchain-powered e-commerce app. But the simplest of errors exposed the scam and limited the damage to investors. A cautionary tale for the crypto economy.

Sky is the crypto limit

Laurence Boisseau

PARIS — Air Next promised to use blockchain technology to revolutionize passenger transport. Should we have read something into its name? In fact, the company was talking a lot of hot air from the start. Air Next turned out to be a scam, with a fake website, false identities, fake criminal records, counterfeited bank certificates, aggressive marketing … real crooks. Thirty-five employees recruited over the summer ranked among its victims, not to mention the few investors who put money in the business.

Maud (not her real name) had always dreamed of working in a start-up. In July, she spotted an ad on Linkedin and was interviewed by videoconference — hardly unusual in the era of COVID and teleworking. She was hired very quickly and signed a permanent work contract. She resigned from her old job, happy to get started on a new adventure.


Others like Maud fell for the bait. At least ten senior managers, coming from major airlines, airports, large French and American corporations, a former police officer … all firmly believed in this project. Some quit their jobs to join; some French expats even made their way back to France.

Share capital of one billion 

The story began last February, when Air Next registered with the Paris Commercial Court. The new company stated it was developing an application that would allow the purchase of airline tickets by using cryptocurrency, at unbeatable prices and with an automatic guarantee in case of cancellation or delay, via a "smart contract" system (a computer protocol that facilitates, verifies and oversees the handling of a contract).

The firm declared a share capital of one billion euros, with offices under construction at 50, Avenue des Champs Elysées, and a president, Philippe Vincent ... which was probably a usurped identity.

Last summer, Air Next started recruiting. The company also wanted to raise money to have the assets on hand to allow passenger compensation. It organized a fundraiser using an ICO, or "Initial Coin Offering", via the issuance of digital tokens, transacted in cryptocurrencies through the blockchain.

While nothing obliged him to do so, the company owner went as far as setting up a file with the AMF, France's stock market regulator which oversees this type of transaction. Seeking the market regulator stamp is optional, but when issued, it gives guarantees to those buying tokens.

screenshot of the typo that revealed the Air Next scam

The infamous typo that brought the Air Next scam down

compta online

Raising Initial Coin Offering 

Then, on Sept. 30, the AMF issued an alert, by way of a press release, on the risks of fraud associated with the ICO, as it suspected some documents to be forgeries. A few hours before that, Air Next had just brought forward by several days the date of its tokens pre-sale.

For employees of the new company, it was a brutal wake-up call. They quickly understood that they had been duped, that they'd bet on the proverbial house of cards. On the investor side, the CEO didn't get beyond an initial fundraising of 150,000 euros. He was hoping to raise millions, but despite his failure, he didn't lose confidence. Challenged by one of his employees on Telegram, he admitted that "many documents provided were false", that "an error cost the life of this project."

What was the "error" he was referring to? A typo in the name of the would-be bank backing the startup. A very small one, at the bottom of the page of the false bank certificate, where the name "Edmond de Rothschild" is misspelled "Edemond".

Finding culprits 

Before the AMF's public alert, websites specializing in crypto-assets had already noted certain inconsistencies. The company had declared a share capital of 1 billion euros, which is an enormous amount. Air Next's CEO also boasted about having discovered bitcoin at a time when only a few geeks knew about cryptocurrency.

Employees and investors filed a complaint. Failing to find the general manager, Julien Leclerc — which might also be a fake name — they started looking for other culprits. They believe that if the Paris Commercial Court hadn't registered the company, no one would have been defrauded.

Beyond the handful of victims, this case is a plea for the implementation of more secure procedures, in an increasingly digital world, particularly following the pandemic. The much touted ICO market is itself a victim, and may find it hard to recover.

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