Authorities arrest suspects in relation to cyber heist carried out in Russian Central bank

  09 Dec 2016 , 17:07

Russian authorities arrested a large number of suspects in May in connection with the recently revealed electronic theft of $19 million from accounts held at the Russian central bank, an official said on Wednesday. The bank said last week that hackers had this year used fake client credentials to steal money from correspondent accounts — used to handle transactions on behalf of another bank — at the Bank of Russia.

Banks around the world are tightening the security of their messaging and money transfer networks following a number of cyberattacks – most notably the use of stolen Bangladesh Bank credentials to send SWIFT messages requesting the transfer of nearly $1 billion from its correspondent account at the New York Federal Reserve. The hackers succeeded in transferring $81 million to four accounts in Manila.

Artyom Sychyov, deputy head of the Bank of Russia’s security directorate, said the Federal Security Service, or FSB, and the Interior Ministry, which oversees the police, had run a joint operation after the Russian heist, and that “a large number of people were arrested”. He declined to give further details – but on June 1, the FSB said it had, together with the police, detained some 50 people suspected of the electronic theft of 1.7 billion rubles ($27 million) from unnamed Russian financial institutions.

The FSB and Interior Ministry did not immediately respond to questions about whether this was the operation mentioned by Sychyov. Sychyov said the attack on the central bank had been confined to third-party correspondent accounts. “The payment system of the Bank of Russia cannot in any way be implicated,” he said.

The Bank revealed the attack in a sparse passage on page 37 of a 69-page financial stability report published last Friday. It said the hackers had broken into an electronic system that gives clients access to correspondent accounts held within the Bank. It said they had attempted to steal 2.87 billion rubles ($45 million), of which 1.67 billion was later frozen or recovered.

Since the report was published, central bank officials have declined to answer detailed questions. This week, the Bank of Russia moved Sergei Moiseyev, head of the department for financial stability, which was responsible for the report, to a new job as adviser to the bank’s governor on reform of the leasing industry. The bank did not respond directly when asked if Moiseyev’s removal was linked to the publication of the information about the cyberattack.

Reuters

Bangladesh sends a team to Philippines to speed up the recovery of funds stolen in SWIFT hack

Image: Reuters

  25 Nov 2016 , 10:17

A Bangladesh delegation will visit the Philippines to speed up recovery of the rest of some $81 million stolen from its account in the New York Federal Reserve in February, two officials said on Thursday, after recovering a fifth of the funds.

The five-member team, led by Law Minister Anisul Haq, will hold talks with Philippines authorities on Nov. 28 to Dec. 1. “We are hoping it will help expedite the recovery of the rest of stolen funds,” a member of the team told Reuters, on condition of anonymity. Unknown cyber criminals used stolen Bangladesh Bank credentials to try to transfer nearly $1 billion from its Fed account in early February, one of the biggest bank frauds ever.

They succeeded in transferring some $81 million via an account at the New York Federal Reserve to four accounts in fake names at a branch of Rizal Commercial Banking Corp in Manila. Most of the money was laundered through casinos in Manila and remains missing. Only $15.25 million has been recovered. It was returned to Bangladesh earlier this month.

A senior central bank official told Reuters the team will also try to meet Philippine President Rodrigo Duterte, who had earlier pledged the stolen money would be returned. The team also included Bangladesh Bank Governor Fazle Kabir; Attorney General Mahbubey Alam; Abdur Razzaq, the chairman of the parliamentary standing committee on the finance ministry; and Eunusur Rahman, secretary of the Finance Ministry’s bank and financial institutions division.

This week, an anti-money laundering body in the Philippines filed charges against five officials of RCBC bank and a former treasurer who “wilfully ignored” suspicious activity that led to the money vanishing after the cyber theft. No arrests have been made, despite investigations by the U.S. Federal Bureau of Investigation, Interpol, Bangladesh police and authorities in the Philippines.

Reuters

IBM, NVIDIA partner for 'fastest deep learning enterprise solution' in the world

IBM and NVIDIA

By Conner Forrest | November 14, 2016, 7:25 AM PST

IBM and NVIDIA recently teamed up to announce IBM PowerAI, a software toolkit that accelerates machine training for AI solutions and will boost IBM Watson's capabilities.

IBM PowerAI, a new deep learning software toolkit announced Monday, could help train computers for machine learning and AI tasks faster than ever before. The solution, a joint project from IBM and NVIDIA, runs on an IBM server built specifically for AI and uses NVIDIA NVLink as well.

According to a press email announcing the availability of the solution, IBM PowerAI is the "world's fastest deep learning enterprise solution," and it will "help train computers to think and learn in more human-like ways at a faster pace."

This new toolkit was designed to work with IBM's Power Systems LC lineup of Linux servers, specifically the IBM Power S822LC for High Performance Computing (HPC). That server has NVIDIA's latest GPU technology on board, which helps further its potential for use in deep learning and AI applications.


While this new product is geared toward "emerging computing methods of artificial intelligence" like deep learning, it also has implications for IBM's better-known cognitive computing project, Watson. IBM PowerAI will bolster Watson's enterprise AI skills by providing the platform with additional training.


"PowerAI democratizes deep learning and other advanced analytic technologies by giving enterprise data scientists and research scientists alike an easy to deploy platform to rapidly advance their journey on AI," Ken King, general manager for OpenPOWER, said in the email. "Coupled with our high performance computing servers built for AI, IBM provides what we believe is the best platform for enterprises building AI-based software, whether it's chatbots for customer engagement, or real-time analysis of social media data."

Of course, none of this matters if there aren't real-life applications for the technology. In the press email, IBM noted that technologies such as the deep learning this toolkit provides have been used for fraud protection in banks, facial recognition applications, and even in self-driving cars.

In the past, IBM Watson has been used in verticals like healthcare, legal, finance, retail, cybersecurity, and even fantasy football. So, it's possible that we will see IBM PowerAI in these fields as well.


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Existing IBM customers who have IBM's Power S822LC for HPC server can access IBM PowerAI immediately at no additional charge, the email said.
The 3 big takeaways for TechRepublic readers


IBM and NVIDIA recently partnered on IBM PowerAI, a new software toolkit, to accelerate deep learning initiatives in business.
PowerAI is meant to run on the IBM Power S822LC for High Performance Computing and exists as a separate product, but will work with Watson.
IBM sees these deep learning technologies as important to verticals like healthcare, finance, retail, and self-driving cars.

Finance Minister Jaitley emphasises that India needs to undergo rapid urbanisation in next 2 decades

Image: Urban Engines

  27 Oct 2016 , 19:00

Union Finance Minister Arun Jaitley on Thursday stressed on India’s need to urbanise rapidly in the next two decades in line with its present development in order to relieve the pressure on agriculture. “In the next two decades, India will have to go for rapid urbanisation, in line with what we see already — the growth of satellite towns, of suburbanization around metros, etc,” Jaitley said.

The Minister was addressing the ADB-Asian Think Tank Development Forum here on sustainable urbanisation organised by the National Institute of Public Finance and Policy, ADB and ICRIER. “Urbanisation is inevitable to relieve agriculture from the number of people still living off the land. Urban India is now 31 percent of the country’s population..urban centres have become engines of growth in the states,” he added.

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Jaitley mentioned Bengaluru and Gurgaon as two rapidly developing centres in recent times. He noted the hitherto “unorganised construction” involved in this urbanisation process and stressed on the need for more “participation of organised construction to create organised townships.”

Asking, “Are we ready for this massive urbanisation in terms of infrastructure like water, transport, roads and sanitation,” Jaitley said that more resources were likely to be given to the states under the Smart Cities initiative.

“The Smart City initiative has prompted substantial competition among cities, themselves organised around the basis of objective criteria. More resources are soon likely to be given to the cities,” Jaitley said. “The Swachch Bharat — Clean India campaign will be integral to the urbanisation process,” he added.

IANS

Banks in United States working on integrating Zeller instant payment network

Image Credits: REUTERS/Matt Siegel

  24 Oct 2016 , 16:13

By the end of December some U.S. bank customers may begin to notice features of the new Zelle instant payments network appearing on their mobile phone and online banking apps as the financial industry tries to catch up to technology company rivals, such as Venmo. Paul Finch, chief executive of the bank network operator, Early Warning Services, said during the weekend that buttons on user screens for digital payments at some banks will gradually start to use a uniform procedure for individuals to send and receive money.

Then early next year about 20 banks will put the Zelle name on their mobile apps and web pages. A Zelle app also will be offered to the public for connections through other institutions. The consortium is taking a series of steps in its attempt to bring more than 100 million customers of banks and credit unions into Zelle without disrupting people who already use other ways to send money with phones and computers.

“This is about creating a wide, and inclusive, alternative to cash and checks for everyone,” said Finch, who was at the Money 20/20 payments industry conference in Las Vegas to promote Zelle for its bank owners. The moves come five years after three of the biggest banks -JPMorgan Chase & Co, Bank of America Corp and Wells Fargo & Co – formed a joint-venture, initially called clearXchange, to make it easier to send money to accounts at different banks.

But the banks were slow to bring other financial institutions into the fold and market the network and so lost momentum to technology company upstarts. Citigroup Inc did not agree to join until September. The banks only recently decided to use the name Zelle. In the meantime, Venmo appeared. In the three months through September, Venmo processed $4.9 billion of person-to-person payments, up 131 percent from a year earlier.

Venmo, now part of PayPal Holdings Inc, built its following by social networking young adults ready to share dinner tabs and apartment rents with their phones. But the banks have larger bases of customers to connect as they try to make Zelle ubiquitous. JPMorgan’s Chase “Quick Pay,” for example, processed $7.4 billion in the three months ended September, up 36 percent from a year earlier, according to bank spokeswoman Rebecca Acevedo.

The initial set of 19 banks to offer Zelle early next year has about 76 million customers using mobile banking apps and about 65 percent of U.S. checking and savings accounts, Finch said. Agreements in place with additional financial institutions, debit card networks and other payment companies, such as Fiserv Inc, will bring the portion of accounts to 90 percent to 95 percent, Finch said.

The bank consortium owners decided that for Zelle to succeed it needs to look and work the same for everyone. But some banks already have made digital payment brand names, such as JPMorgan’s Quick Pay, familiar to many of their customers. Those banks will use the Zelle name prominently alongside their established names as Zelle catches on, Finch said.

Reuters

Banks uses blockchain to the make first cross-border international trade transaction

Image Credit: Commonwealth Bank of Australia

  24 Oct 2016 , 15:48

The first cross-border transaction between banks using multiple blockchain applications has taken place, Commonwealth Bank of Australia and Wells Fargo & Co said on Monday, resulting in a shipment of cotton to China from the United States. Australian cotton trader Brighann Cotton Marketing bought the shipment bound for the port city Qingdao from U.S. division Brighann Cotton in Texas, the companies and their banks said in a joint statement. The blockchain trade, for 88 bales, totalled $35,000, Commonwealth Bank told Reuters.

Blockchain is a web-based transaction processing and settlement system whose efficiency banks say could slash costs. It creates a “golden record” of any given set of data that is automatically replicated for all parties in a secure network, eliminating any need for third-party verification. “Existing trade finance processes are ripe for disruption, and this proof of concept demonstrates how companies around the world could benefit from these emerging technologies,” Michael Eidel, Commonwealth Bank’s executive general manager for cash flow and transaction services, said in the statement.

The transaction is not the first involving the decentralised database, used since 2009 for the digital currency bitcoin. But it is a milestone for the traditional banking industry which at first shied away from the technology, partly because it makes money flows harder for law enforcement agencies to track.

Led by a consortium of over 70 of the world’s biggest financial institutions – called R3 – the banking industry has been researching ways to harness the speed, accuracy and efficiency afforded by blockchain. One of its benefits is removing people from transaction processing. That has been seen as especially appealing for cross-border trades, which are typically held up by duplication of payment processing and time zone differences.

R3 has been researching ways to expand the use of blockchain to include “smart contracts”, or payments triggered when certain conditions are met. The cotton transaction, for instance, involved automatically making payments when the shipment reached certain geographic locations, the statement showed. The shipment is currently between Singapore and Hong Kong, and is due to arrive in early November, Commonwealth Bank said. The bank also said that R3 – of which it and Wells Fargo are members – did not play a part in the trade.

Brighann Cotton was not available for comment when contacted by Reuters. Wells Fargo’s head of international trade services, Chris Lewis, said in the statement that his bank was committed to new technology. He also said, “significant regulatory, legal and other concerns remain to  be addressed.”

Reuters