Geopolitics

Spotlight: The Stakes Of Aleppo

The numbers are impressive, terrifying, bone-chilling. At least 20,000 people have fled their homes in Aleppo this week alone, according to the International Red Cross, as the Syrian army and its allies make significant, and perhaps crucial, gains in the eastern part of the city, controlled mostly by jihadist fighters. The UK-based Syrian Observatory for Human Rights puts the figure significantly higher, at 50,000.


Beyond the immediate humanitarian crisis, what we are witnessing in Aleppo might be no less than a major turning point in the almost six-year Syrian war. The Syrian-led offensive and recent gains by government forces could soon lead to the full recapture of the city. The U.N. Syria envoy Staffan de Mistura admitted as such yesterday, when he told the European Parliament: "I can't tell you how long eastern Aleppo will last." Winning the battle for Aleppo would be a crucial victory for Bashar al-Assad, and perhaps more importantly for Russia, an ally with its own agenda.


Writing from Syria, reporter Georges Malbrunot with the French daily Le Figaro describes growing concern among Syrian officials close to President Assad as Russia slowly places its pawns at various decisionary levels. "Cold realpolitik is dominating on all sides. ‘We have no alternative," an advisor to the Syrian president admits. Those around Assad are grateful to the Russians for saving them in the summer of 2015, but that doesn't stop them from being concerned. ‘We're not in control at the negotiating table," he adds when asked about a potential political transition. He says discussions are now at an impasse and fears that eventually, the Russian ally might abandon Assad."


With recent reports claiming that "the Russians want to complete the Aleppo operation before Trump takes power," according to a Syrian official quoted by Reuters, it seems that Vladimir Putin is already looking beyond the war and is seeking to reinforce his position ahead of the final negotiations. What place Assad, the rebels or the civilians who've lost everything occupy in his grand plans is anybody's guess.

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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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