Australian who boasted of hacking to plead not guilty to charges stemming from raid

A 17-year-old Australian who in February claimed to have breached networks at Microsoft and Sony will plead not guilty to charges stemming from a police raid on his home.

Interestingly, none of the charges lodged against Dylan Wheeler relate to his claims to have breached the networks and extracted software tools used to develop games for the XBox One and PlayStation systems.

According to documents shared by Wheeler, he is charged with possession of child exploitation material, dishonestly obtaining credit card information, possession of identification information with the intent of committing an offense, and disobeying a data access order to reveal his passwords.

Wheeler said Friday he also faces a weapons charge related to a stun gun that police seized from his family's home, and possession of drug paraphernalia.

He told Perth Children's Court on Friday how he intends to plead, and said he will formally plead not guilty in a hearing scheduled for Nov. 11.

Wheeler maintains he is innocent, and believes the charges are in part retribution.

The police "were pissed off at the fact that I went to the media," Wheeler said.

Western Australian Police in Perth declined to comment on the case.

Eventually, Wheeler said, he expects hacking charges to be filed against him. He has been open about his probes into Microsoft's and Sony's networks, and said he told Microsoft about weaknesses in its network.

"To my knowledge they [Microsoft] fixed up a lot of the problems they had," he said, while Sony "did try and fix the issues."

But Wheeler did provoke Microsoft. In August 2012, he posted an eBay listing for a "Microsoft Xbox Durango Development Kit." That same month he was visited by an investigator with Microsoft's IP Crimes Team.

In February, he placed another eBay auction listing for a "Durango" PC. The listing expired on Feb. 19, the same day police raided his family's home, seizing three Apple computers, a 1TB hard drive, credit cards, his mobile phone and a stun gun, among other items.

Wheeler's lawyer, Marc Saupin, said Friday that Australian legal rules prevent counsel from commenting about an ongoing case.

Formula One Chief Indicted on Bribery Charges

Kamran Jebreili/Associated Press Bernie Ecclestone, pictured in this April 19 photo, has been indicted on bribery charges.
Bernie Ecclestone, the 82-year-old Englishman who controls the commercial rights to the Formula One racing series, has been indicted in Germany in a seven-year-old bribery affair, it was announced on Wednesday in Munich.

News of the indictment, while expected for some time, adds one more subject, and a major one, to the problems faced by the Formula One community. Mr. Ecclestone is accused of paying a $44 million bribe to Gerhard Gribkowsky, a German banker who was responsible for helping the Bavarian state bank dispose of certain assets, including 47.4 percent of the shares of Formula One Holdings, of which Mr. Ecclestone is chairman.

The shares went to CVC, an British private equity firm, per Mr. Ecclestone’s wishes. He has openly admitted the payment, saying it was a fee for services, and not a bribe. Mr. Gribkowsky was sentenced to eight years by a German court for tax evasion as a result, and is currently serving that sentence.

The indictment adds to Formula One’s current list of challenges, not the least of which is the lack of a logical successor to Mr. Ecclestone. Although he has become a billionaire from the series, he has also elevated the incomes of practically everyone involved in the world championship.
A trial date has not yet been set.

Ofcom proposes cuts to wholesale broadband charges

The price BT is allowed to charge for its wholesale broadband is set to be slashed by Ofcom, leading to savings for the consumer.

BT today proposed new charge controls on BT’s Openreach products, which it sells to smaller ISPs so they can offer broadband telephone lines over the dominant network.

If the plans go through, the current charge of £84.26 for fully unbundled lines – which enable providers to install their own equipment for telephone and broadband services in BT’s exchanges – could fall by up to 6% every year between April 2014 and March 2017.

Shared unbundled lines – ISPs using their own equipment for broadband but BT’s voice network – will see the £9.75 annual charge fall between 8% and 12% every year and wholesale line rental – where providers use BT’s voice network to offer their own phone service – will drop from £93.27 annually by between 2% and 8% over the three year period.

Ofcom hopes these savings will then lead to cheaper deals for consumers buying services from providers using BT’s wholesale network.

“These controls would reduce wholesale charges that could be expected to lead to real-terms price reductions for consumers, as communications providers pass on savings to their landline and broadband customers,” read a statement from the regulator.

The changes should not come as a surprise to BT. The prices have always been regulated by Ofcom due to the significant market power held by the telecoms giant across the UK and last week the regulator published its fixed access market review showing this dominance was still apparent.

This review also made proposals around cutting the minimum contract ISPs have to sign up to in order to get virtual unbundled local access (Vula) from one year to one month and to slash the charge levied by BT to ISPs when they change providers.

Are alternative mobile operators the answer to roaming charges?

Regulations due to come into force across Europe in 2014 could offer a big opportunity for mobile operators if they can see a strong business case and slash roaming costs for consumers. But, as with much legislation, there are substantial problems too.

This was the belief of executives from OpenCloud, a software company offering solutions to telecoms companies to help improve their services.

Proposals from the European Union (EU) in 2011 led to regulations – set to come into effect in July 2014 – that will grant mobile users the option of choosing an alternative operator when using their handsets abroad. This would cut roaming costs significantly and give operators the opportunity to use competitor networks for a fair-priced wholesale fee.

But with less than a year to go, mobile providers are running out of time to put the technology in place. Debate rages on in the industry as to whether it is practical and whether all the mobile operators will be able to make the deadline.

Mark Windle, head of marketing for OpenCloud, said the new rules had been “forced by the will of the regulators”. He said it left operators “feeling a sense of frustration that they have to go through this expensive exercise, which will in turn reduce operating income, and they are footing the bill for it."

Jonathan Bell, vice-president of product marketing at OpenCloud, added: “Previous EU roaming legislation has changed the price, both for wholesale and to prevent bill shock for people coming home from their holidays or business trips, but this legislation will change the way the network works.

“To use an alternative provider, the way signaling behaves has to change, not just a number.”

There is no question the model is feasible from a technological standpoint - but there is no getting away from how much cost and effort it will require of operators.

“It is not just one place in the network that has to make the change but each individual service,” explained Bell. “These networks are 24/7, so they rarely change to prevent blackouts or downtime - but if they change this all at once there is a danger of it going wrong.”

And having such a short period to make such changes only increases the risk.

“It is a very challenging time scale because operators change networks in a slow and considered fashion,” Bell said. “They will be hard-pressed to do this in time.”

However, there is a clear opportunity for one or more of the operators to bring their group operations closer together and make a stronger play across Europe.

They have all the right assets, the right technology, the right knowledge and the right people. The question is whether they see a business case or not
Jonathan Bell, vice-president of product marketing at OpenCloud

“If one of the telcos decides to go for it, it could become a European-wide operator and capture a huge portion of the market and revenue,” said Bell. “They have all the right assets, the right technology, the right knowledge and the right people. The question is whether they see a business case or not.”

Neelie Kroes, the European Commissioner responsible for the digital agenda, has been pushing forward both this regulation and the longer term goal of having a single European market for telecoms. This could mean that, rather than the cluttered networks in Europe – with each country having numerous providers – the continent could look more like the US which, despite its size, only has four operators.

However, what the European Commission (EC) regulator seems to have forgotten is the other regulators involved at the local level.

“It is complying with regulations; that is the tricky bit,” explained Bell. “Unlike in the US where they have one regulator, here there are 28 countries and 28 regulators to answer to.”

“Neelie Kroes is quoting very ambitious targets for a single telecoms market and I don’t think it is going to happen in one or two years. The spectrum has been sold separately in each country and the regulators remain dispersed.”

If prices abroad were the same as at home, this wouldn’t be an issue Mark Windle, head of marketing at OpenCloud

But at the centre of what might be the most complicated issue for Brussels and the mobile operators is the user. Having alternative providers when abroad will make a big difference to their pocket. Both Bell and Windle believe that, if it is about price, there could be an easier way than forcing change in the network infrastructure.

“If the pricing [for roaming] was more transparent and at a reasonable price, this level of choosing an alternative provider wouldn’t be necessary as it would always be simpler and easier to stay with the operator we are with at home,” said Bell.

“Exactly,” added Windle. “If prices abroad were the same as at home, this wouldn’t be an issue.”

A group of 27 European Commissioners voted to end roaming charges in June 2013, with the goal of having this in play by the same deadline as the new alternative operator legislation. However, it has not passed yet and, while costs have been driven down for roaming in Europe by the EU and will continue to fall next year, it is unclear whether this proposal will come into play before the alternative roaming laws.

While operators might moan about the position they have been put in, they may need to stop arguing and start focusing on getting everything ready on time. EU citizens will have greater choice and cheaper options to staying connected once abroad – which is what many think the European regulators should focus on.

Gadgetwise Blog: Q&A: Setting Up Gmail Securely

I’m trying to download my Gmail into the Apple Mail program on a new Mac and I’m getting an error when I try to set up the account. I have Gmail’s extra verification turned on, but there’s no place in the Mac’s Mail program to enter the security code they send to my phone. What can I do?

Google’s two-step verification feature can trip up mail-setup scripts that are not equipped to handle anything more than just a standard password. In this situation — or if you have recently turned on two-step verification and found your mail program or devices can no longer get Gmail — you need to log into your Gmail account in the Web and set up an “application-specific password.”

You can find Google’s step-by-step instructions for using application-specific passwords here and a YouTube video demonstration online as well. Once you log into your account and go to your security settings, you can get to the application-specific passwords area. Here, you can type in a name for the application (like “Apple Mail”) and click a button to generate a lengthy one-time password to type into the Mail program’s password box.

Google’s site has a troubleshooting page that guides you through setting up other types of mail software to send and receive messages from your Gmail account. The page also includes links to guides for programs besides Apple Mail, like Microsoft Outlook, Windows Mail, Mozilla Thunderbird and mail programs for Android, BlackBerry and iOS devices.

Ex-Murdoch editors lose bid to have UK hacking charges dropped

LONDON - Two former editors of a British tabloid newspaper shut down by owner Rupert Murdoch over a phone-hacking scandal lost a legal battle on Friday to have criminal charges against them dropped.

Rebekah Brooks and Andy Coulson, both former News of the World editors and close associates of Prime Minister David Cameron, have pleaded not guilty to charges that they conspired to intercept people's voicemail messages in pursuit of stories.

Their lawyers had argued that once a message had been heard by its intended recipient it was no longer "in the course of transmission" as defined by the Regulation of Investigatory Powers Act under which the charges were brought.

The hacking scandal prompted Murdoch to shut down the mass-selling Sunday tabloid in July 2011 and led to a huge police investigation and to a public inquiry that revealed embarrassingly cozy ties between the media and politicians.

The judge in charge of the hacking case had rejected the defense arguments advanced by lawyers for Brooks, Coulson and three other former News of the World staff in May, but this could not be reported at the time for legal reasons.

The defendants appealed, but the Court of Appeal upheld the earlier judgment on Friday and allowed it to be reported.

"There is no good reason why the first receipt of the communication should be considered as bringing the transmission to an end," the Court of Appeal judges wrote.

The ruling means that Brooks, Coulson and others will stand trial as planned in September on hacking and other charges.

Brooks and Coulson both deny charges of involvement in the bribery of public officials for stories, and Brooks also denies perverting the course of justice.

Brooks, who after leaving the News of the World went on to edit its sister paper the Sun, Britain's highest-selling newspaper, later became the boss of Murdoch's entire British newspaper arm until the hacking scandal forced her out.

In her heyday, she enjoyed close friendships with senior politicians including Cameron.

After leaving the News of the World, Coulson went on to work as Cameron's chief of communications. He was forced out of that job in January 2011 as the hacking scandal gathered pace.

Prism implicates Facebook, Yahoo and others in Europe, student group charges

The U.S. government surveillance program known as Prism, which reportedly collects data from major technology companies, has compelled a European student group to file a barrage of complaints against the companies, claiming the data collection runs afoul of European privacy laws.

 

The complaints were recently filed in Ireland against Facebook and Apple, in Luxembourg against Skype and Microsoft, and in Germany against Yahoo. The complaints are directed at the companies' European subsidiaries.

 

The Austrian student group Europe-v-Facebook.org said that while the Prism scandal is playing out in the U.S., "most of the involved companies conduct their business through subsidiaries in the EU in order to avoid U.S. taxes." This means that the companies must abide by European privacy laws, the group said.

 

The basis of the group's complaints concerns how the companies export their user data back to their U.S. counterparts. When a European company sends that data back to its U.S. parent company, that is considered an "export" of the data, the group said, which is only allowed if the subsidiary can ensure an "adequate level or protection" in the foreign country, the group said Wednesday in a statement.

 

However, "after the recent disclosures on the Prism program, such trust in an 'adequate level of protection' by the involved companies can hardly be upheld," the group said.

 

In their privacy policies, some of the largest tech companies say that they will share users' personal information to meet applicable laws, regulations, legal processes or enforceable government requests.

 

Since Prism's revelations have ripped trough the technology industry and the privacy landscape more broadly, companies like Facebook, Google, Twitter and Microsoft have called for greater transparency in disclosure of data on government requests for customer information.

 

Yahoo, for instance, has since disclosed some of its user data requests, but companies have had a harder time clearing the way to specifically reveal requests made under the Foreign Intelligence Surveillance Act (FISA), which has been at the center of the Prism controversy.

 

"For European subsidiaries of the involved companies, American 'gag order' does not apply," the student group said Wednesday, adding, "in contrast to that, the companies are even under an obligation to tell the truth under European proceedings."

 

Germany, Luxembourg and Ireland must now decide whether it is legal for European companies to mass-transfer personal data to a foreign intelligence agency, the group said.

 

"We want a clear statement by the authorities if a European company may simply give foreign intelligence agencies access to its customer data," it said.

 

"If this turns out to be legal, then we might have to change the laws," it added.

 

In recent weeks, Europe's justice commissioner has pledged that Europeans' rights would not be sacrificed for U.S. national security.

 

The student group also seeks more clarity from the tech companies on how they handle users' personal data under European procedures.

 

Facebook, Apple, Microsoft, Skype and Yahoo could not be immediately reached to comment on the complaints.

 

In 2006, E.U. data protection authorities already decided in a case involving the payment processor Swift that a mass transfer of data to the U.S. authorities is illegal under EU law, the student group said.

 

Google and YouTube were not included in the first round of complaints, the group said, because they do not use European intermediaries.

 

"But since Google has data centers in Ireland, Belgium and Finland, we can take similar actions on a slightly different path," they said.

 

Follow me on Twitter @sajilpl

CFTC charges Corzine in MF Global collapse

WASHINGTON - A top U.S. regulator charged former MF Global chief Jon Corzine over the collapse of the futures brokerage, blaming the former Goldman Sachs co-chief executive with being a key actor in one of the country's 10 biggest bankruptcies.

The Commodity Futures Trading Commission said on Thursday it will seek in a civil case to ban Corzine and former Assistant Treasurer Edith O'Brien from the industry, and also seek penalties against the two.

"Mr. Corzine is charged with being more than a passive actor in the downfall of MF Global," CFTC enforcement head David Meister said on a call with journalists. "He lacked good faith and ... violated his supervision obligations."

The CFTC also settled with MF Global Inc, which agreed to pay a $100 million penalty and funds still owed to customers, but will continue to pursue MF Global Holdings Ltd.

The futures brokerage collapsed in October 2011 under the weight of aggressive bets on European sovereign debt, after Corzine - a former New Jersey governor and U.S. senator - sought to transform the brokerage into a global investment bank.

But investors quickly lost confidence in the company's health when the European economy weakened in the middle of 2011, asking MF Global to put up more money to secure the trades, and causing its remaining cash to rapidly vanish.

Customers were left reeling after it was discovered that about $1.6 billion was missing from their accounts and that the company had used the money to stop gaps in its business, which unlawful and caused a political fire storm.

"This is an unprecedented lawsuit based on meritless allegations," said Andrew Levander, a lawyer for Corzine. "Mr. Corzine did nothing wrong, and we look forward to vindicating him in court," he said.

O'Brien's lawyer had no immediate comment.

In its investigations, the CFTC found that MF Global's company treasurer was describing the liquidity situation as "skating on the edge" and recommended to "take the keys away" from Corzine, which did not happen.

Corzine has often struck a defiant tone when testifying in late 2011 before lawmakers about the debacle, pointing the finger at back-office dealings he had no insight in, and denying knowledge of any instructions to misuse customer funds.

And O'Brien invoked her constitutional right against self-incriminated and refused to answer questions when called to testify. But the CFTC's complaint places the two firmly at the heart of the $41 billion bankruptcy.

GAME OVER

In the last week the company existed, Corzine was aware of its true low cash balance, but he continued to pay large obligations, the CFTC said in its complaint.

"Our investigation also recovered an audio recording of (O'Brien) saying to a colleague that it could be 'game over' from a regulatory perspective if the customer funds weren't returned," Meister said on the call.

"Given what (the CFTC) must have perceived to be the challenges of the facts I think they've crafted a complaint that lays out a good theory," said Gary DeWaal, who formerly worked as a senior trial attorney for the agency. "From a drafting perspective, the complaint tells a complete story," he said.

But another lawyer, asking to speak anonymously, said there was little in the complaint that pointed to fraud, reducing chances of any criminal charges.

But U.S. Representative Michael Grimm, a New York Republican, urged prosecutors to bring criminal charges against Corzine, saying there was growing proof that he had committed perjury in his testimony before lawmakers.

The CFTC also sought an order for Corzine and O'Brien to disgorge any salaries or bonuses, or trading profits, that they had received from any unlawful actions.

Louis Freeh, the trustee liquidating MF Global, has said in the past he believed customers would get all their money back when the company in April won court approval to liquidate its assets, and end its $40 billion bankruptcy.

Most customers have already been reimbursed for about 93 percent of the value of their accounts.

There was praise from across the political spectrum for the CFTC's action. Senator Debbie Stabenow, a Michigan Democrat, and Texas Republican Congressman Randy Neugebauer cited the importance of futures markets for farmers, who use them to protect against wild swings in commodity prices.

But not everybody was happy.

"I don't think the penalty is high enough," said Dean Tofteland, a Minnesota farmer, who is still missing about $20,000 he had at MF Global when it collapsed.

"Apparently there's still this mindset out there that people can get away with stuff like this if you're well connected like Jon Corzine is," he said.

Follow me on Twitter @sajilpl

Prism implicates Facebook, Yahoo and others in Europe, student group charges

The U.S. government surveillance program known as Prism, which reportedly collects data from major technology companies, has compelled a European student group to file a barrage of complaints against the companies, claiming the data collection runs afoul of European privacy laws.

 

The complaints were recently filed in Ireland against Facebook and Apple, in Luxembourg against Skype and Microsoft, and in Germany against Yahoo. The complaints are directed at the companies’ European subsidiaries.

 

The Austrian student group Europe-v-Facebook.org said that while the Prism scandal is playing out in the U.S., “most of the involved companies conduct their business through subsidiaries in the EU in order to avoid U.S. taxes.” This means that the companies must abide by European privacy laws, the group said.

 

The basis of the group’s complaints concerns how the companies export their user data back to their U.S. counterparts. When a European company sends that data back to its U.S. parent company, that is considered an “export” of the data, the group said, which is only allowed if the subsidiary can ensure an “adequate level or protection” in the foreign country, the group said Wednesday in a statement.

 

However, “after the recent disclosures on the Prism program, such trust in an ‘adequate level of protection’ by the involved companies can hardly be upheld,” the group said.

 

In their privacy policies, some of the largest tech companies say that they will share users’ personal information to meet applicable laws, regulations, legal processes or enforceable government requests.

 

Since Prism’s revelations have ripped trough the technology industry and the privacy landscape more broadly, companies like Facebook, Google, Twitter and Microsoft have called for greater transparency in disclosure of data on government requests for customer information.

 

Yahoo, for instance, has since disclosed some of its user data requests, but companies have had a harder time clearing the way to specifically reveal requests made under the Foreign Intelligence Surveillance Act (FISA), which has been at the center of the Prism controversy.

 

“For European subsidiaries of the involved companies, American ‘gag order’ does not apply,” the student group said Wednesday, adding, “in contrast to that, the companies are even under an obligation to tell the truth under European proceedings.”

 

Germany, Luxembourg and Ireland must now decide whether it is legal for European companies to mass-transfer personal data to a foreign intelligence agency, the group said.

 

“We want a clear statement by the authorities if a European company may simply give foreign intelligence agencies access to its customer data,” it said.

 

“If this turns out to be legal, then we might have to change the laws,” it added.

 

In recent weeks, Europe’s justice commissioner has pledged that Europeans’ rights would not be sacrificed for U.S. national security.

 

The student group also seeks more clarity from the tech companies on how they handle users’ personal data under European procedures.

 

Facebook, Apple, Microsoft, Skype and Yahoo could not be immediately reached to comment on the complaints.

 

In 2006, E.U. data protection authorities already decided in a case involving the payment processor Swift that a mass transfer of data to the U.S. authorities is illegal under EU law, the student group said.

 

Google and YouTube were not included in the first round of complaints, the group said, because they do not use European intermediaries.

 

“But since Google has data centers in Ireland, Belgium and Finland, we can take similar actions on a slightly different path,” they said.

 

 

Chris Brown faces new charges

 The RnB star Chris Brown has been charged with a hit-and-run and driving without a valid licence.

Lawyers for the district attorney's office in Los Angeles say the singer gave false insurance information and refused to hand over his licence after his car hit a Mercedes last month.

Both offences together carry a maximum of one year in jail.

Brown is currently on five years' probation for attacking his ex-girlfriend, the singer Rihanna.

If a judge rules the charges violate his probation, reports suggest he could face up to four years in jail.

Brown assaulted his 25-year-old ex-girlfriend in 2009 and accepted a plea deal of community service, five years' formal probation and domestic violence counselling.

Six months ago, it was claimed he was involved in another fight, this time with singer Frank Ocean, over a car parking space outside a Hollywood recording studio.

Police said Brown was under suspicion for punching the victim but the case was dropped after Ocean decided not to press charges.

 

U.S. charges Edward Snowden with espionage, report says

Edward Snowden, the former NSA contractor who leaked information about U.S. government mass surveillance programs, has been charged by the U.S. with espionage, the Washington Post reported Friday.

Federal prosecutors have filed a sealed criminal complaint against Snowden (above) and are seeking to have him arrested in Hong Kong, according to the Post, which cited unnamed U.S. officials. He is charged with espionage, theft, and conversion of government property, the report says.

By bringing the charges, the U.S. has begun a process by which it can try to have Snowden extradited to the U.S. to face trial. Snowden can fight the effort in the Hong Kong courts, however, in a process that could last several months, the Post said.

Snowden sparked a furor this month after he leaked details about two U.S. surveillance programs to the Washington Post and the U.K.’s Guardian newspaper. One program, called Prism, gives the National Security Agency access to customer data collected by large Internet firms, and the other provides access to U.S. phone call records.

Snowden has been both vilified as a traitor and hailed as a champion of the public’s right to privacy. He flew to Hong Kong last month after leaving his job as a contractor at an NSA facility in Hawaii and is thought to still be located in the Chinese territory.

U.S. officials, including President Barack Obama, have defended the programs, saying they have helped to disrupt numerous terrorist plots in the U.S. and overseas. And they say the programs are subject to rigorous oversight.

Snowden has since expanded his accusations, saying NSA analysts can access the contents of a U.S. target’s phone calls and emails without a court order.

The complaint against Snowden was filed in the Eastern District of Virginia, a jurisdiction where Snowden’s former employer, Booz Allen Hamilton, has its headquarters, the Post reported.