Geopolitics

ARABICA - A Daily Shot Of What the Arab World is Saying/Hearing/Sharing

ARABICA - A Daily Shot Of What the Arab World is Saying/Hearing/Sharing

In Saudi Arabia, a new facebook group called "The People Want The Government To Reform" has attracted more than 2,000 members in the past day.

A R A B I C A ارابيكا

By Kristen Gillespie

FACEBOOKED

*In Saudi Arabia, a new facebook group called "The People Want The Government To Reform" has attracted more than 2,000 members in the past day. The unnamed founders have listed 12 demands, including the formation of a constitutional monarchy, transparency, an independent judiciary, legislative elections and the end of discrimination towards women and others. A commenter named Ferzoduq al-Rass wrote on the page: "Some of us fear prison if we say what we really believe."

EGYPT'S GOOGLE MAN

*Newly freed Google executive Wael Ghonim gave his first interview after nearly two weeks of detention by the Egyptian intelligence service. Visibly exhausted and emotional, Ghonim described to Egypt's Dream TV network what it was like to be blindfolded for 12 days and unable to contact his family. Ghonim downplayed his role in the Egyptian uprising, saying "I'm not a hero. The real heroes are the people who are in the square, sacrificing their lives and exposing themselves to danger." He broke down in tears when shown pictures of fellow young Egyptians who had been killed in the crackdown.

*Ghonim may not want to serve as a leader for the revolution unfolding, but he seemed just that as he vowed the protests will grind on: "We want our rights and we will take them. End of story," he said. On the 15th day of protests, with their demand fixed on President Hosni Mubarak's immediate ouster, tens of thousands of protesters blocked new Prime Minister Ahmed Shafiq from entering his office and shouted demands for the government to resign.

VIDEO

*Al Jazeera broadcast a report from the torched remains of a detention center run by the feared intelligence apparatus. "America – a country of freedom?" asked a man on the scene holding up an American-made tear-gas canister. The correspondent toured the site, and went downstairs to the underground dungeons sectioned off for women and men. Local residents led the correspondent on a tour of the site while denouncing the Mubarak regime's brutality.

ALL NEWS IS LOCAL

*One day after receiving an unusually blunt letter from 36 Bedouin tribal leaders, calling for economic and political reforms to begin immediately, Jordan's King Abdullah made a surprise (but well-staged) visit to be embraced by an elderly Bedouin woman in one of the kingdom's most impoverished villages in the northern Jordan Valley. The visit is the fourth in the past month to poor Jordanian villages. Local news website khaberni.com carefully described the visit as being "in the context of the king's ongoing communication between His Majesty and his people."

Feb. 8, 2011

photo credit: illustir

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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 but the simplest of errors exposed the scam and limited the damage to investors.

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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