(Roughly) Daily

Posts Tagged ‘crime

“There’s a compounding and unraveling chaos that is perpetually in motion in the Dark Web’s toxic underbelly”*…

 

Dark Web

 

CIRCL, Luxembourg’s computer security incident response team, has published a dataset of 37,500 .onion website screenshots, a subset of which have been categorized by topic (e.g., “drugs-narcotics”, “extremism”, “finance”) and/or purpose (e.g., “forum”, “file-sharing”, “scam”)

Via Jeremy Singer-Vine’s fascinating Data is Plural.

[For more background see “WTF is Dark Web?,” whence the image above]

* James Scott, Senior Fellow, Institute for Critical Infrastructure Technology

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As we grab our flashlights, we might recall that it was on this date in 1979 that CompuServe launched the first consumer-oriented online information service, which they called MicroNET (and marketed via Radio Shack)– the first time a consumer had access to services such as e-mail.

The service was not initially favored internally within the business-oriented CompuServe, but as the service became a hit, they renamed it CompuServe Information Service, or CIS.  By the mid-1980’s CompuServe was the largest consumer information service in the world and half their revenue came from CIS.

In 1989 CompuServe connected its proprietary e-mail system to the Internet e-mail system, making it one of the first commercial Internet services.  But CompuServe did not compete well with America On-Line or independent Internet Service Providers in the 1990’s and rapidly lost its dominant market position.

compuserve-300x205 source

 

Written by LW

September 24, 2019 at 1:01 am

“When I consider Life, ’tis all a cheat”*…

 

ladiesfraud2_web

 

Sarah Howe’s early life is mostly a mystery. There are no surviving photographs or sketches of her, so it’s impossible to know what she looked like. She may, at one point, have been married, but by 1877 she was single and working as a fortune-teller in Boston. It was a time of boom and invention in the United States. The country was rebuilding after the Civil War, industrial development was starting to take off, and immigration and urbanization were both increasing steadily. Money was flowing freely (to white people anyway), and men and women alike were putting that money into the nation’s burgeoning banks. In 1876, Alexander Graham Bell invented the telephone, and in 1879 Thomas Edison created the lightbulb. In between those innovations, Sarah Howe opened the Ladies’ Deposit Company, a bank run by women, for women.

The company’s mission was simple: help white women gain access to the booming world of banking. The bank only accepted deposits from so-called “unprotected females,” women who did not have a husband or guardian handling their money. These women were largely overlooked by banks who saw them — and their smaller pots of money — as a waste of time. In return for their investment, Howe promised incredible results: an 8 percent interest rate…

All told, the Ladies Deposit would gather at least $250,000 from 800 women — although historians think far more women were involved. Some estimate that Howe collected more like $500,000, the equivalent of about $13 million today…

Then, in 1880, it all came crashing down. On September 25, 1880, the Boston Daily Advertiser began a series of stories that exposed Howe’s bank as a fraud. Her 8 percent returns were too good to be true. Howe was operating what we now know as a Ponzi scheme — 40 years before Ponzi would try his hand at it…

Rose Eveleth on the fascinating story of a 19th-century scammer, and what she can teach us about women, lying, and economic boom-and-bust cycles: “The No. 1 Ladies’ Defrauding Agency.”

* John Dryden, Aureng-Zebe

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As we remind ourselves that what’s too good to be true usually isn’t, we might recall that it was on this date in 1946 that FBI agents arrested Chicago gangster George “Bugs” Moran in Kentucky.

During the Prohibition era, Moran was one of the biggest organized crime figures in America, and has been credited with popularizing the drive-by shooting. He was a rival to Al Capone, who gunned down seven members of Moran’s gang in the 1929 Saint Valentine’s Day massacre.

Unlike Capone, Moran wasn’t a clever crime boss. By 1946 he had been reduced to common crimes like bank heists. He was basically penniless. The FBI found him renting an upstairs apartment from a law-abiding couple in Henderson, Ky.  [source]

220px-Bugs_Moran source

 

Written by LW

July 6, 2019 at 1:01 am

“Once, during Prohibition, I was forced to live for days on nothing but food and water”*…

 

prohibtion

 

Americans tend to have a pretty jaundiced view of Prohibition…

… driven by extremists, the country was pushed into an extreme experiment — to ban the sale, production, and transportation of alcohol in the US in 1919 through a constitutional amendment, the 18th. The policy was a political failure, leading to its repeal in 1933 through the 21st Amendment.

There’s also a widespread belief that Prohibition failed at even reducing drinking and led to an increase in violence as criminal groups took advantage of a large black market for booze.

“‘Everyone knows’ that Prohibition failed because Americans did not stop drinking,” historian Jack Blocker wrote in the American Journal of Public Health. He summarized what’s now the conventional wisdom: “Liquor’s illegal status furnished the soil in which organized crime flourished.”

But there’s a lot wrong with these present-day assumptions about Prohibition.

People like [Carry] Nation, as extreme as they were, were driven by real problems caused by excessive drinking, including alcohol-induced domestic violence and crime as well as liver cirrhosis and other health issues. This was perceived as a widespread problem, at least in popular media: George Cruikshank’s 1847 series of drawings, The Bottle, portrayed a father spending all his family’s money drinking and, eventually, killing his wife by attacking her with a bottle. And as historian David Courtwright documented in The Age of Addiction, per capita alcohol consumption increased by nearly a third from 1900 to 1913, largely due to advancements in brewing that helped make beer much cheaper.

Contrary to the conventional wisdom, the evidence also suggests Prohibition really did reduce drinking. Despite all the other problems associated with Prohibition, newer research even indicates banning the sale of alcohol may not have, on balance, led to an increase in violence and crime.

It’s time to reconsider whether America’s “noble experiment” was really such a failure after all…

America’s anti-alcohol experiment cut down on drinking and drinking-related deaths– and it may have reduced crime and violence overall.  Vox takes a sober look at the an episode in American history clouded in received ideas that may not be altogether accurate, making the case that: “Prohibition worked better than you think.”

* W.C. Fields

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As we muse on moderation, we might recall that it was on this date in 1894 (after 30 states had already enshrined the occasion) that Labor Day became a federal holiday in the United States.

labor day

The country’s first Labor Day parade in New York City on Sept. 5, 1882. This sketch appeared in Frank Leslie’s Illustrated Newspaper.

source (and source of more on the history of Labor Day)

 

Written by LW

June 28, 2019 at 1:01 am

“Making money is art”*…

 

art and money

 

In 2005, an unusual painting appeared on the website of the New Orleans Auction Gallery, a small operation headquartered on the banks of the Mississippi River. Twenty-six inches tall and 18 and a half inches wide, the painting depicted Christ in Renaissance-era robes, one hand raised in benediction, the other cupping a diaphanous sphere. “After Leonardo da Vinci (Italian 1452–1519),” read the description. “Christ Salvator Mundi. Oil on cradled panel.”

Among the people to click on the listing for Lot 664 was a Rockland County art speculator named Alexander Parish. Parish has spent his entire career in the art world, first as an assistant, later as an adviser to a major European gallery, and now as what’s known as a picker — a dealer who purchases art from minor auction houses and antiques sales and resells it to wealthy clients at a profit. “A major part of what I do,” Parish told me, “is educated gambling. You get a good feeling about a piece of art, and you place a bet that you know more about it than the auctioneer does.”

Parish felt very good about Lot 664. In fact, although he had only a few postage-stamp-size JPEGS to work with, he thought he might be looking at a piece by a student of Leonardo’s — perhaps the Milanese painter Bernardino Luini. That same afternoon, he sent a link to his friend Robert Simon, the owner of an old-master gallery on the Upper East Side, who has a doctorate in art history from Columbia University with a specialty in the art of the Renaissance.

“My first reaction was that it was a very intriguing painting,” Simon recalled. As he knew, the original Salvator Mundi, painted by Leonardo around 1500, possibly for the French king Louis XII, had been one of da Vinci’s most copied works — dozens of replicas hang in museums around the world, but the original had been lost to history. It seemed possible that another period copy dating to the Renaissance would exist. Simon and Parish agreed to invest in the painting together, with a bid ceiling of $10,000; Parish would handle the bidding via phone. “My memory of the auction is that I just sat there waiting for the price to go up,” Parish said. “But it became apparent that no one else was interested.” His winning bid came in at $1,000.

Today, of course, the contents of Lot 664 are worth far more than that: The picture has since sold once for $127.5 million and again, in a record-setting auction at Christie’s, for close to half a billion dollars…

davinci-restored.w460.h575

Find out how to turn a $1,000 art-auction pickup into a $450 million masterpiece: “The Invention of the ‘Salvator Mundi’.”

* Andy Warhol

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As we appreciate appreciation, we might recall that it was on this date in 1934 that a team of FBI agents went toe to toe with John Dillinger, Baby Face Nelson, and their gang.  The lawmen tried to capture the outlaws at their temporary hide-out, the Little Bohemia Lodge (in northern Wisconsin)

As the agents approached the lodge, the owner’s dogs began to bark. Since the dogs barked incessantly, their warning was ignored by the gang. A few minutes later, a car approached the agents. Thinking that the gangsters were inside, they opened fire in an attempt to shoot out the tires. Shooting high, which often happens when firing on full auto, they hit all of the occupants of the car, and killed one of them. To make matters worse, they had the wrong guys. Dillinger and his crew were still inside the lodge.

Barking dogs you can ignore, but submachine-gun fire will get your attention every time. Dillinger and the boys heard the shots and knew that the heat was on. They opened fire on the agents from the lodge. After throwing some hot lead at the G-men, the gang bolted for the door. Dillinger and two of his guys turned one way and made a clean getaway. Nelson turned the other way, and wound up at a nearby house in a car with the owner of the lodge and a neighbor.

A car containing two of the FBI agents and a local constable approached Nelson. Nelson pointed his gun at them, and ordered them out of the car. When they complied, Nelson shot all three of them. Agent W. Carter Baum was killed; Agent J. C. Newman and local constable Carl Christensen were injured.

The final tally: two dead (one lawman and one innocent bystander), four injured (two lawmen and two bystanders), no gangsters in custody.  [source]

little_bo

Little Bohemia Lodge

 

Written by LW

April 22, 2019 at 1:01 am

“Whoever fights monsters should see to it that in the process he does not become a monster”*…

 

kleptocracy

 

When the U.S.S.R. collapsed, Washington bet on the global spread of democratic capitalist values—and lost…

Much of the rest of the world wanted to shout for joy about the trajectory of history, and how it pointed in the direction of free markets and liberal democracy. [CIA Moscow station chief Richard] Palmer’s account of events in Russia, however, was pure bummer. In the fall of 1999, he testified before a congressional committee to disabuse members of Congress of their optimism and to warn them of what was to come.

American officialdom, Palmer believed, had badly misjudged Russia. Washington had placed its faith in the new regime’s elites; it took them at their word when they professed their commitment to democratic capitalism. But Palmer had seen up close how the world’s growing interconnectedness—and global finance in particular—could be deployed for ill. During the Cold War, the KGB had developed an expert understanding of the banking byways of the West, and spymasters had become adept at dispensing cash to agents abroad. That proficiency facilitated the amassing of new fortunes. In the dying days of the U.S.S.R., Palmer had watched as his old adversaries in Soviet intelligence shoveled billions from the state treasury into private accounts across Europe and the U.S. It was one of history’s greatest heists.

Washington told itself a comforting story that minimized the importance of this outbreak of kleptomania: These were criminal outliers and rogue profiteers rushing to exploit the weakness of the new state. This narrative infuriated Palmer. He wanted to shake Congress into recognizing that the thieves were the very elites who presided over every corner of the system…

The United States, Palmer made clear, had allowed itself to become an accomplice in this plunder. His assessment was unsparing. The West could have turned away this stolen cash; it could have stanched the outflow to shell companies and tax havens. Instead, Western banks waved Russian loot into their vaults. Palmer’s anger was intended to provoke a bout of introspection—and to fuel anxiety about the risk that rising kleptocracy posed to the West itself. After all, the Russians would have a strong interest in protecting their relocated assets. They would want to shield this wealth from moralizing American politicians who might clamor to seize it. Eighteen years before Special Counsel Robert Mueller began his investigation into foreign interference in a U.S. election, Palmer warned Congress about Russian “political donations to U.S. politicians and political parties to obtain influence.” What was at stake could well be systemic contagion: Russian values might infect and then weaken the moral defense systems of American politics and business.

This unillusioned spook was a prophet, and he spoke out at a hinge moment in the history of global corruption…

This was capital flight on an unprecedented scale, and mere prologue to an era of rampant theft. When the Berkeley economist Gabriel Zucman studied the problem in 2015, he found that 52 percent of Russia’s wealth resided outside the country.

The collapse of communism in the other post-Soviet states, along with China’s turn toward capitalism, only added to the kleptocratic fortunes that were hustled abroad for secret safekeeping. Officials around the world have always looted their countries’ coffers and accumulated bribes. But the globalization of banking made the export of their ill-gotten money far more convenient than it had been—which, of course, inspired more theft. By one estimate, more than $1 trillion now exits the world’s developing countries each year in the forms of laundered money and evaded taxes.

An amazing amount of the illicit cash is being solicited and handled by Americans– by banks, lawyers, real estate developers actively conspiring with he mobsters. dictators, and oligarchs whose money they are hiding in anonymized investments.

The defining document of our era is the Supreme Court’s Citizens United decision in 2010. The ruling didn’t just legalize anonymous expenditures on political campaigns. It redefined our very idea of what constitutes corruption, limiting it to its most blatant forms: the bribe and the explicit quid pro quo. Justice Anthony Kennedy’s majority opinion crystallized an ever more prevalent ethos of indifference—the collective shrug in response to tax avoidance by the rich and by large corporations, the yawn that now greets the millions in dark money spent by invisible billionaires to influence elections.

In other words, the United States has legitimized a political economy of shadows, and it has done so right in step with a global boom in people hoping to escape into the shadows.

American collusion with kleptocracy comes at a terrible cost for the rest of the world. All of the stolen money, all of those evaded tax dollars sunk into Central Park penthouses and Nevada shell companies, might otherwise fund health care and infrastructure. (A report from the anti-poverty group One has argued that 3.6 million deaths each year can be attributed to this sort of resource siphoning.) Thievery tramples the possibilities of workable markets and credible democracy. It fuels suspicions that the whole idea of liberal capitalism is a hypocritical sham: While the world is plundered, self-righteous Americans get rich off their complicity with the crooks.

The Founders were concerned that venality would become standard procedure, and it has. Long before suspicion mounted about the loyalties of Donald Trump, large swaths of the American elite—lawyers, lobbyists, real-estate brokers, politicians in state capitals who enabled the creation of shell companies—had already proved themselves to be reliable servants of a rapacious global plutocracy. Richard Palmer was right: The looting elites of the former Soviet Union were far from rogue profiteers. They augured a kleptocratic habit that would soon become widespread. One bitter truth about the Russia scandal is that by the time Vladimir Putin attempted to influence the shape of our country, it was already bending in the direction of his.

Read Franklin Foer’s important report in full at: “Russian-Style Kleptocracy Is Infiltrating America.”

* Friedrich Nietzsche

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As we get down with Diogenes, we might recall that it was on this date in 1866 that Jesse James robbed his first bank, in Liberty, Mo.  James and his crew (a remnant of his Civil War service in the Confederate guerrilla outfit known as Quantrill’s Raiders) are believed to have targeted the bank because it was owned by abolitionist Republican former militia officers.

220px-Jesse_james_portrait source

 

Written by LW

February 13, 2019 at 1:01 am

“The world is full of obvious things which nobody by any chance ever observes”*…

 

crime-perceptions

 

There’s a persistent belief across America that crime is on the rise.

Since the late 1980s, Gallup has been polling people on their perception of crime in the United States, and consistently, the majority of respondents indicate that they see crime as becoming more prevalent. As well, a recent poll showed that more than two-thirds of Americans feel that today’s youth are less safe from crime and harm than the previous generation.

Even the highest ranking members of the government have been suggesting that the country is in the throes of a crime wave:

We have a crime problem. […] this is a dangerous permanent trend that places the health and safety of the American people at risk. (then-Attorney General Jeff Sessions)

Is crime actually more prevalent in society?… crime rate data from the FBI shows a very different reality…

More on a phenomenon that would simply be bemusing if it weren’t driving both personal and governmental action: “The Crime Rate Perception Gap.”

* Sherlock Holmes, in Arthur Conan Doyle’s The Hound of the Baskervilles

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As we triple-lock our doors, we might recall that it was on this date in 1976 that Sesame Street aired episode #847, featuring Margaret Hamilton reprising her role as the Wicked Witch of the West from the 1939 film The Wizard of Oz.  It scared children so badly that the episode has never been re-aired. (This, after she had appeared as herself in three episodes of Mister Rogers’ Neighborhood, between 1975 and 1976– because Fred Rogers wanted his young viewers to recognize the Wicked Witch was just a character and not something to fear.)

220px-Sesame_Street_Margaret_Hamilton_Oscar_The_Grouch_1976 source

 

“A firm’s income statement may be likened to a bikini- what it reveals is interesting but what it conceals is vital”*…

 

41052602860_a889faa191_z

A recent (Roughly) Daily noted (by way of a quote from James Surowiecki) that “the challenge for capitalism is that the things that breed trust also breed the environment for fraud.”  A painful recent example was, the failure of credit ratings agencies honestly to assess the risk of derivatives being traded against home mortgages, which contributed mightily to the crash that occasioned The Great Recession.

But, as Richard Brooks argues, there’s a bigger and more pervasive problem still lurking:  accountancy used to be boring – and safe.  Today it’s neither.  Have the ‘big four’ firms become too cosy with the system they’re supposed to be keeping in check?  Are we in for Enron all over again, only this time on the financial system-wide basis?

The demise of sound accounting became a critical cause of the early 21st-century financial crisis. Auditing limited companies, made mandatory in Britain around a hundred years earlier, was intended as a check on the so-called “principal/agent problem” inherent in the corporate form of business. As Adam Smith once pointed out, “managers of other people’s money” could not be trusted to be as prudent with it as they were with their own. When late-20th-century bankers began gambling with eye-watering amounts of other people’s money, good accounting became more important than ever. But the bean counters now had more commercial priorities and – with limited liability of their own – less fear for the consequences of failure. “Negligence and profusion,” as Smith foretold, duly ensued.

After the fall of Lehman Brothers brought economies to their knees in 2008, it was apparent that Ernst & Young’s audits of that bank had been all but worthless. Similar failures on the other side of the Atlantic proved that balance sheets everywhere were full of dross signed off as gold. The chairman of HBOS, arguably Britain’s most dubious lender of the boom years, explained to a subsequent parliamentary enquiry: “I met alone with the auditors – the two main partners – at least once a year, and, in our meeting, they could air anything that they found difficult. Although we had interesting discussions – they were very helpful about the business – there were never any issues raised.”

This insouciance typified the state auditing had reached. Subsequent investigations showed that rank-and-file auditors at KPMG had indeed questioned how much the bank was setting aside for losses. But such unhelpful matters were not something for the senior partners to bother about when their firm was pocketing handsome consulting income – £45m on top of its £56m audit fees over about seven years – and the junior bean counters’ concerns were not followed up by their superiors.

Half a century earlier, economist JK Galbraith had ended his landmark history of the 1929 Great Crash by warning of the reluctance of “men of business” to speak up “if it means disturbance of orderly business and convenience in the present”. (In this, he thought, “at least equally with communism, lies the threat to capitalism”.) Galbraith could have been prophesying accountancy a few decades later, now led by men of business rather than watchdogs of business…

A chilling, but important report: “The financial scandal no one is talking about.”

* Burton G. Malkiel

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As we count beans, we might recall that it was on this date in 1873 that Samuel Clemens (the author known as Mark Twain) received a U.S. patent, his second, for a self-pasting scrapbook (No. 140,245).  His creation used a dried adhesive on its pages so that users need only moisten a page in order to attach pictures.

In 1871, Clemens had scored his first patent, for “an Improvement in Adjustable and Detachable Straps for Garments”–an adjustable strap that could be used to tighten shirts at the waist that was later used on women’s corsets, and is considered by many to be the precursor of the adjustable bra strap.  He earned his third patent in 1875 for a history trivia game,“Mark Twain’s Memory-Builder Game.”

 source

 

Written by LW

June 24, 2018 at 1:01 am

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