Geopolitics

FIFA Under Fire, New Delhi Fever, Human A.I.

Shimon Peres, Pope Francis and Mahmoud Abbas gathered Sunday for "A Prayer For Peace" in the Vatican garden.
Shimon Peres, Pope Francis and Mahmoud Abbas gathered Sunday for "A Prayer For Peace" in the Vatican garden.
Worldcrunch

Monday, June 9, 2014

POROSHENKO INITIATES PEACE TALKS
Newly inaugurated Ukrainian President Petro Poroshenko said violence in the country must end “this week,” as he took part in peace talks with the Russian ambassador to Kiev and a representative for the Organization for Security and Co-operation in Europe, the Financial Times reports. Meanwhile, fighting continued yesterday in the eastern city of Sloviansk and officials from the Russian region of Rostov said that more than 7,300 Ukrainians had crossed the border into Russia on Sunday alone.

SNAPSHOT
Israel President Shimon Peres, Pope Francis and Palestinian leader Mahmoud Abbas gathered Sunday for "A Prayer For Peace" in the Vatican garden. The unprecedented meeting represents hope for a new journey towards peace in the Middle East.

KARACHI AIRPORT TALIBAN ATTACK
The Pakistani Taliban have claimed responsibility for an attack on the airport of the country’s largest city, Karachi, which left at least 28 people dead, including 12 terrorists, after a 12-hour fight, according to The Express Tribune. Some of the gunmen were dressed in army uniform and carried grenades and rocket launchers while at least three others were wearing suicide vests, AFP reports. According to a spokesperson for Pakistan International Airlines, no airline passengers were affected.

MY GRAND-PÈRE'S WORLD


ATTACKS CONTINUE IN IRAQ
At least 14 people were killed and 50 injured after a suicide bomber driving a truck attacked a police checkpoint in northern Iraq this morning, in the latest spate of violence in the country. This comes after a series of attacks across the country left 69 people dead and 99 others injured yesterday. According to the website World Bulletin, Iraqi troops have killed 37 fighters from terrorist organization Islamic State of Iraq and the Levant in an operation in the northern city of Mosul.

WORLDCRUNCH-TO-GO
As Gazeta Wyborcza’s Igor T. Miecik reports, Poland's newly elected European Parliament member Janusz Korwin-Mikke is an offensive, misogynistic and divisive political figure, yet many young people — even young women — are among his unlikely supporters. “The controversial 72-year-old right-wing leader has said the Paralympics were like ‘chess matches for morons,’” the journalist writes. “And there was this one: ‘If you knew something about women, you would realize that men always rape a bit.’ … So what has attracted Poland's young people to an elderly man who is a declared monarchist? The members of the party's youth from Warsaw and Krakow are all different and yet seem remarkably the same. They speak quickly, with an unshakeable self-confidence, and are more than keen to meet a reporter to talk politics.”
Read the full article, How A Controversial 72-Year-Old Seduces Poland's Youth.

GROWING PRESSURE ON FIFA OVER QATAR
Four of FIFA’s main sponsors have called on the football governing body to deal “appropriately” with the ongoing allegations of corruption surrounding the vote that awarded Qatar the 2022 World Cup, Reuters reports. FIFA’s longest serving partner, Adidas, said in a statement that “the negative tenor of the public debate around FIFA at the moment is neither good for football nor for FIFA and its partners.” In a Le Monde/Worldcrunch article, journalist Stéphane Mandard explains that “Qatargate” could be related to an internal fight for power at FIFA.
Former U.S. prosecutor Michael Garcia is due to wrap up his investigation today, with the organization hoping that the scandal won’t overshadow the World Cup in Brazil that begins Thursday. Meanwhile, in São Paulo metro workers enter their fifth strike day today, paralyzing Brazil’s largest city. The state’s governor threatened to dismiss workers who don’t show up to work.

47.8
Extremely high temperatures hit India over the weekend, with thermometers hitting a record 47.8 °C (118 °F) in New Delhi, causing energy consumption to surge.

FRESH ACCUSATIONS IN CHINA-VIETNAM ROW
In a statement published online, China’s Foreign Ministry accused Vietnamese vessels of “attempting to break through China's cordon and ramming the Chinese government ships a total of 1,416 times” near a drilling rig in the South China Sea. Last week, Vietnam released a video showing a Chinese ship colliding with a small Vietnamese fishing boat, apparently confirming Hanoi’s version of the May 26 incident. Beijing’s decision to deploy an oil rig in disputed waters sparked a diplomatic row between the two countries as well as anti-Chinese riots in Vietnam, in which four people died.
For more about the dispute, we offer this Caixin/Worldcrunch piece, Vietnam Will Pay A Price For Its Anti-Chinese Violence.

A.I. BREAKTHROUGH
Meet Eugene Goostman, the first computer program to have duped enough humans over its true nature to pass the Turing Test, an achievement that some critics warn could be used for cybercrime.

HAPPY BIRTHDAY
Donald Fauntleroy Duck turns 80 today, which will give you a great excuse to rewatch some of his best cartoons.

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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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