Geopolitics

Putin Request Ignored, Starving Somalis, Cruelest Cabbie

More than 50,000 Somali malnourished children are facing death.
More than 50,000 Somali malnourished children are facing death.

PUTIN REFERENDUM REQUEST IGNORED
Pro-Russian activists in the region of Donetsk announced that a referendum on the region’s status would go ahead as planned on Sunday, despite yesterday’s call from Russian President Vladimir Putin to postpone it, RT reports. Earlier Ukraine officials had said that the military operation in Eastern Ukrainewould continue regardless of whether the referendum, which the Kiev government regards as illegal, was delayed.

  • The decision from Donetsk is a blow to Putin’s step towards de-escalation yesterday, with one of the favorites in the Ukrainian presidential race, Petro Poroshenko, saying he “welcomed” the initiative “with cautious optimism.” German Foreign Minister Frank-Walter Steinmeier said that Putin’s “constructive tone” could mark “a decisive point” in the Ukrainian crisis.

  • Moscow and NATO, however, had a heated exchange, with the Russian Foreign Ministry saying that NATO’s Secretary General Anders Fogh Rasmussen was “blind” after he wrote on Twitter that, contrary to what Putin had announced, he had seen no sign that Russian troops had withdrawn from the Ukrainian border. “I have very good vision, but while we've noted Russia’s statement so far we haven't seen any — any — indication of troops pulling back,” he posted later.

  • A poll conducted by the Washington-based Pew Research Center found that 70% of the population in Eastern Ukraine want their country to keep its current borders. Even 58% of Russian speakers agree. Read more from AP.

VERBATIM
More than 50,000 malnourished children are “at death’s door” in Somalia, according to a new report from a group of aid agencies. “The problem with Somalia is that it has been a crisis for over 20 years,” says Oxfam’s Ed Pomfret. “People more or less roll their eyes and think: "Pirates, terrorists, hunger and death. What can I do about that?”

REWARD ON MISSING NIGERIAN GIRLS
The hunt for abducted Nigerian schoolgirls continues as the U.S., the UK and France join forces with local authorities. Nigerian police are offering a reward of $300,000 to anybody providing information leading to the rescue of the 276 schoolgirls abducted by Boko Haram three weeks ago, Vanguard reports. This came after news yesterday that the Islamist group had killedat least 336 people when it attacked a town in Nigeria’s northeastern region.

HUGE EXPLOSION IN ALEPPO
A hotel used by Syrian troops as a military base in the northern city of Aleppo was completely destroyed by what local media have described as a “huge explosion” with a high number of casualties among the troops likely. The London-based Syrian Observatory for Human Rights said that rebels from the Islamic Front had “planted a huge amount of explosives in a tunnel they dug below the Carlton hotel,” which they detonated remotely. Read the full story from AP.

MY GRAND-PÈRE'S WORLD



FERRY COMPANY OFFICIAL ARRESTED
South Korean police have arrested the head of the sunken ferry’s operator, and charges against him include “manslaughter and a violation of the act on vessel safety,” Yonhap news agency reports. This comes amid mounting fears for the safety of diverssearching the wreckage after one of them died Tuesday. There are still 35 people missing, and 269 bodies have been recovered, but the searches are being hampered by poor weather conditions and high waves.

MERS DISEASE SPREADS IN SAUDI ARABIA
Eighteen more cases of Middle East Respiratory Syndrome (MERS) have been identified in Saudi Arabia, after four people died from the disease yesterday, Reuters reports. A total of 449 people in the country have now been infected with MERS, a form ofcoronavirus, causing 121 deaths since it was identified two years ago. The United States detected its first case last week, and Slate explains in a very detailed piece that the virus will be very difficult to stop.

For more on the subject, we offer this CFR/Worldcrunch article, Why A Saudi Virus Is Spreading Alarm.

ANC LEADING GENERAL ELECTION
South Africa’s African National Congress party has taken an early lead in yesterday’s general election with almost half of the votes counted. According to the Mail & Guardian, incumbent President Jacob Zuma’s party has just about 60% of the vote, while the opposition party Democratic Alliance is in second place with 23%. Although the ANC is expected to win the elections, theBBC explains that any result under 60% will be seen “as a major upset.”

CRUELEST TAXI DRIVER EVER?
The Japanese police have arrested a cab driver who nourished a bizarre sexual thrill by routinely offering his female passengers snacks laced with diuretics so he could watch and film them as they grew desperate to go to the toilet. Tip for tourists in Osaka: Don’t accept food in taxis!


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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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