Cyber crooks target gamers; E-gambling dens menace, raid in Penang, etc

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Cyber crooks target gamers

 By P. ARUNA  aruna@thestar.com.my

SERI KEMBANGAN: Cyber crooks have now set up fake gaming sites to steal information from Internet surfers.

They are also stealing personal information from online gamers and selling virtual gaming items like weapons to other players.

Cybersecurity Malaysia, which is an agency under the Science, Technology and Innovation Ministry, said cyber criminals were targeting gaming websites and had spread their wings to Malaysia, with five cases reported so far.

“Gaming websites have already become a lucrative business for cyber criminals in South Korea and China,” said Cybersecurity Malaysia vice-president (cyber security responsive services) Adli Abd Wahid.

“Gamers are spending more money on online gaming, purchasing battle tanks', avatars' and other virtual gadgets and tools needed to advance to higher levels of a certain online game.

“Cyber crooks can steal the usernames and passwords of users who have advanced to a certain level in a game, and sell the account to buyers who want to continue playing the game from that level.”

Adli said that since many gamers preferred not to waste time starting from the lowest levels, they were willing to buy from cyber crooks.

The crooks could also steal the virtual weapons and gadgets from compromised accounts and sell them to other players.

Adli estimated that 99% of phishing websites targeting Malaysians were created and operated overseas, with foreign syndicates often hiring locals as “money mules” to transfer stolen money to foreign bank accounts.

The number of phishing sites detected in Malaysia rose from 634 cases in 2009 to 1,426 reports that were lodged last year.

IDC Market Research (M) Sdn Bhd associate analyst Devtar Singh said there were currently an estimated 7.3 million online gamers in Malaysia.

International anti-phishing service provider Internet Identity (IID) reported that the attacks were expected to rise with the global online gaming industry generating over US$15bil (RM44bil) annually, making it a strong target for criminals.
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Residents: End the game for e-gambling dens

By ELAN PERUMAL and STUART MICHAEL  newsdesk@thestar.com.my

PETALING JAYA: Action must be taken against operators of e-gambling dens because addiction to gambling is making families suffer, said Women, Family and Community Development Deputy Minister Heng Seai Kie.

Her ministry had received numerous complaints from women, especially mothers and wives, on the negative impact caused by such gambling dens.

They complained how family members had became addicted to gambling due to the existence of these premises near their homes.

Heng said the mothers complained that their children’s studies were badly affected by the addiction to gambling.

“The wives also told us that their husbands frequent such premises and lose their earnings at the cyber casinos,” she said.

Heng said she had received feedback that the number of illegal casinos were mushrooming in the Klang Valley, especially Selangor.

She urged the state government to act against this illegal activity.

Meanwhile, resident associations (RA) called for sterner action against the cyber casinos.

Aman Suria RA pro-tem chairman Wendy Chan said the lack of consistency among the local authorities had led to the mushrooming of the illegal cyber casinos.

While acknowledging the authorities did take action against the illegal e-gambling dens, Chan said their actions were not effective.

“The best way is for the local authorities to closely monitor and carry out regular checks.’’

Damansara Jaya RA president Datuk Hew Cheng Hoe said it was impossible for the residents associations to act on the complaints against the illegal activity.

“I believe the authorities will do the necessary to stop the illegal operators,’’ he said.

Bandar Country Homes RA president Soong Beng Khoon said the authorities should also go after those who supplied equipment to these illegal gambling centres.

He added that these casinos were popular as they were strategically located in residential areas.

Taman Rawang Perdana 2 RA chairman Ong Siew Hong said there were many cybercafes in his area and some youngsters, who initially played for fun, eventually become addicted.

“This has become a social problem and the authorities must view it seriously.”

 E-gambling menace

Stories by M.KUMAR and AUSTIN CAMOENS

Under control: A police officer securing the area during a raid on gambling dens in Gombak, Selangor.

KUALA LUMPUR: Many people, including schoolchildren, are losing millions of ringgit monthly at e-gambling dens.

The cyber casinos attract customers by offering a variety of gambling games from mahjong and roulette to virtual slot machines.

The premises are sparsely furnished. Rows of computers line the space and customers are seen glued to the screens.

Bets start from as low as 25sen to as high as the participant wants. There have been cases where players bet thousands of ringgit for one hand of Blackjack.

EO for cyber crooks

PETALING JAYA: The Emergency Ordinance (EO) will be used against operators of illegal cyber casinos who have been raking in millions of ringgit monthly.

The police, however, face a setback because the gaming servers are located overseas, making it difficult to nab the culprits.

Other developments:

> The Selangor and Kuala Lumpur Cybercafe Owners Association has come up with an integrated approach to rebrand the industry and educate members;

> Selangor Government slammed over inaction against such operators; and

> Habitual gamblers say they are attracted by the low bets offered.

13 held in Penang after cyber raid

By TAN SIN CHOW sctan@thestar.com.my

GEORGE TOWN: Police have detained 13 caretakers and workers of cybercafes which are believed to be fronts for illegal online gambling.

During an operation code-named Ops Dadu, the police also seized 128 computer sets from 13 cybercafes throughout the state.

State CID chief Senior Asst Comm (SAC) Zahruddin Abdullah said the 13, mostly caretakers in their 20s and 30s, were nabbed during a five-hour operation which ended at 1am.

Gambling gadgets: George Town CID chief Deputy Supt Shahurinain Jais showing some of the seized items at Datuk Keramat police station in Penang Thursday. Aug 4, 2011

 

Most such premises were found in central Seberang Prai and George Town districts.

SAC Zahruddin said police had intensified their raids on online gambling dens with 4,440 computers and gambling machines seized in the first six months of this year.

He added that 1,150 raids were also carried out with 440 arrests made.

“The statistics show the number of raids, arrests and seizures have increased tremendously compared with last year and 2009.

“Constant raids have been carried out but the problems still persist. We will continue with our efforts,” he said during a press conference at the state police headquarters here yesterday.

Police made 759 and 434 arrests in 2009 and last year respectively.

They had carried out 1,045 raids in 2009 and 1,339 last year.

SAC Zahruddin said there were hundreds of cyber cafes in Penang with a large number being run without licences from local authorities.

He added that many operators were also caught abusing licences obtained from local authorities by running online gambling in their premises.

“We have problems tracking down the masterminds as most of the time those who look after the premises are foreigners.

“The operators have hi-tech tools. With only the press of a button, computers in the premises will be switched off.

“This makes it even harder for us to establish a case against them.”

When contacted, Penang municipal councillor Iszuree Ibrahim said cybercafe operators who run online gambling activities had never applied for licences from the Penang Municipal Council.

He said only 17 out of hundreds of cybercafe operators on the island were given licences.

“We are only able to issue summonses to the perpetrators but this will not deter them from carrying out such activities at their premises as they are raking in millions of ringgit annually.”

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What's left to trust in the world of money? Stop fooling around Govermnt Debts!

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Jeremy Warner

What's left to trust in the world of money?

America's inability to address its fiscal challenges – Sunday night's "bipartisan debt deal" offers only a temporary, sticking plaster solution – has raised afresh an old conundrum.

Relative to GDP, US sovereign debt has been far higher than it is today, but in the past America has been able to rely on fast growth and demilitarisation to return borrowing to tolerable levels. Neither of these things seem likely to come to the rescue this time around. Photo: REUTERS

If even US Treasuries are now regarded as a credit risk, is there anything left at all in the world of money that can be trusted?

The answer to this question is almost certainly no, but far from being a calamitous conclusion to reach, this might be viewed as a positive development which will in time restore market disciplines to a global monetary system which became based on make believe.

In fact, the idea of the sovereign as a "risk free asset" is a comparatively recent development which has no basis in historical experience. Even in a country such as Britain with no history of default (we'll ignore the case of war loans, which is arguable), government bonds have hardly proved a reliable form of investment.

True enough, coupons have been paid and maturities honoured, but the currency and inflation risks have proved extreme. On any medium to long term view, you would have done much better out of property and equities.

Among members of the eurozone, the concept of the sovereign as a safe haven asset is an even shorter lived phenomenon. The widening of spreads we've seen in the past year and a half of financial crisis is as nothing compared to the way it was before the single currency was launched.

Those countries with weak governance were punished for their lack of competitiveness with high interest rates and repeated currency crises. It was a brutal, but reasonably effective form of discipline.

But once the euro had been established, all countries, bad as well as good, came to enjoy the same low interest rates that Germany had earned from years of hair shirted fiscal rectitude. Bond yields converged not because anyone believed the single currency's fiscal rules would make all countries like Germany, but because markets expected that countries which got themselves into difficulties would be bailed out. They have so far been proved entirely correct in this assumption.

Peer group pressure

The abolition of sovereign currencies removed the pressures that markets normally exert on governments to take unpopular, austerity measures. Market disciplines were replaced by peer group pressure from European finance ministers, only a few of whom were in any position to lecture their colleagues on sound financial policies. Once even Germany started to break the rules, the game was up.

All this was brilliantly predicted by Norman Lamont, a former UK Chancellor in the chapter Why I am Against the Single Currency from his book In Office, published nearly twelve years ago.

Increasingly tortuous attempts to prevent wide scale default fail to acknowledge the underlying reality; membership of the single currency has allowed some countries to borrow far in excess of their ability ever to repay.

But it is not all the fault of the euro. Risk compression was a worldwide phenomenon during the boom. In the hunt for yield, investors became oblivious to the dangers. By the end, almost everything was regarded as entirely risk free. Credit rating agencies were corrupted into the process by giving top notch ratings to fundamentally unsafe assets. These judgements then became embedded in regulatory requirements and central bank collateral rules, making everything seem safer than it really was.

 Sovereign downgrades

Today, the rating agencies are accused of deepening the debt crisis with repeated sovereign downgrades, but if anything, their pronouncements understate the reality. Their discomfort is nowhere more apparent than with US sovereign debt. Even assuming the latest settlement – which envisages a $2.1trillion (£1.3 trillion) fiscal consolidation over ten years – is ratified, it's not enough to put public debt back on a sustainable trajectory.

It's perfectly true that relative to GDP, US sovereign debt has been far higher than it is today, but in the past America has been able to rely on fast growth and demilitarisation to return borrowing to tolerable levels. Neither of these things seem likely to come to the rescue this time around.

When Standard & Poor's placed the US on negative watch last month, it suggested that a consolidation of perhaps as much as $4 trillion would be required to safeguard the nation's triple A rating.

Heading for a downgrade

Implicitly, then, America is heading for a downgrade regardless of the fact that the immediate threat of default has been removed. Will S&P have the guts to go through with its threat? I'll believe it when I see it. Already S&P has appeared to backtrack in evidence to Congress.

The major rating agencies enjoy an unhealthily cosy relationship with the major sovereigns, and can usually be persuaded to do the "right thing" in the interests of financial stability. As ever, sweeping the issue under the carpet will only make the eventual crisis even worse.

But perhaps oddly, the immediate blow to America if the big agencies do decide to downgrade is likely to be more psychological than real; it may not matter too much for bond yields.


Despite loss of its triple A rating and central government debt in excess of 200pc of GDP, Japan continues to enjoy the lowest sovereign bond yields anywhere in the world.

This apparent paradox is explained by the fact that when there is generalised risk aversion, where consumers are reluctant to spend and companies won't invest, the consequent savings surplus tends to flow into the only place it can – government debt.

Some of the same phenomenon is occurring in the US right now. Much as China threatens to withdraw its support for the US dollar in protest at policies which it thinks debase the currency, it really has no option but to continue buying US Treasuries as long as it maintains such a big trade surplus with the US. The capital surplus is merely the mirror image of the trade surplus.

Dominant reserve currency status in any case gives the US unrivalled access to international borrowing. Dollar hegemony may not last for much longer, but for the time being there are no viable alternatives. 

This is both a blessing and a curse for the US – a blessing because it allows the country to keep borrowing at reasonable rates almost regardless of underlying public debt dynamics, and a curse because it maintains the addiction to debt.

If nothing is done, the façade will eventually break; that's the point at which to run for the hills. Food, property, energy – these are the things that retain value when money dies. - Telegraph

Govt debts – it’s time to stop fooling around

Plain Speaking - By Yap Leng Kuen

INDEBTEDNESS has become an unsavoury word, especially when an important economy like the United States faces potential default if its US$14.3 trillion debt ceiling is not raised in time.

As at press time, an agreement was reached on raising the debt limit; however, the uncertainty created during the stalemate prior to the agreement had cast an element of doubt in the markets over the long term viability of US Treasuries and a possible downgrade of US' credit rating.

The debt ceiling has been raised before; however, the severity of the problems faced by Greece and other countries with high debt levels has caused the US situation to be viewed with concern.

In fact, post-2008 financial crisis, government debt has become a major issue. In a research update, McKinsey Global Institute said while global debt and equity hit new highs, more than a third of growth last year was government debt.

According to McKinsey, the overall amount of global debt grew by US$5 trillion last year, with global debt to gross domestic product (GDP) increasing from 218% in 2000 to 266% in 2010.

Government bonds outstanding rose by US$4 trillion in 2010 while other forms of debt had mixed growth, said McKinsey.

The move to downsize debt needs to be backed up by a concrete and consistent plan that shows not just commitment but also conviction of all parties involved.

Countries with high levels of debt must show that they are not only able to save others but also themselves.

Part of a government's credibility lies in its ability to manage its finances. Simply put, this involves lowering or containing its costs while increasing revenue.

Much effort should be spent on plugging the leakages while taking pains that taxpayers, who usually bear the brunt of others' mistakes, are not disadvantaged.

Postponing the problem by merely raising the limit for another time just makes matters worse; the issue of indebtedness becomes more serious and future governments end up inheriting the problem rather than spending productive hours on new areas of growth.

To get the cooperation of taxpayers to sacrifice for another round of austerity drive will probably not be easy. They may question why they have to pay for the excesses when they had already paid on previous bailouts for the big boys.

It is therefore time to stop “fooling around” with the finances and really get down to work on solid improvements. A transparent approach with proper timelines that can be accessed by all will certainly help.

Once people see something concrete coming up, they will be more convinced and committed towards the common goal.

Moreover, money allocated in a fair and equitable manner will result in better support from taxpayers.

Associate editor Yap Leng Kuen recognises that managing a country is far more complex than a family although the same dose of common sense is required.

Barclays, HSBC, BoA among big European, US Banks Job Cuts, Hard Hit !

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Barclays job cuts take Europe’s tally to 40,000

Swiss firms hit by impact of soaring franc

LONDON (MarketWatch) — A running tally of planned job cuts by European banks reached around 40,000 Tuesday, little more than halfway though earnings season, as firms that failed to control costs or were over-optimistic about growth make the deepest cuts.

Barclays PLC UK:BARC -0.12%   BCS -0.84%  was the latest to confirm job losses Tuesday, saying it’s already cut 1,400 jobs and indicating the figure could rise to around 3,000 by the end of the year.

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Citibank Executive on U.S. debt deal

In an interview with The Wall Street Journal, Michael Zink, Citibank's country officer in Singapore, discusses the implications of the U.S. debt-ceiling deal for global markets and the dollar.

The announcement came as the bank reported a 38% drop in net profit to 1.5 billion pounds ($2.45 billion), partly due to compensation it’s paying to customers who were sold inappropriate insurance.

The Barclays cuts take the total announced by banks reporting in the last week to 35,000. On top of that, UBS AG CH:UBSN -7.70%   UBS -4.68%  also confirmed it would slash jobs, with media reports in Switzerland pegging the number of losses at around 5,000.

The total doesn’t include a further 15,000 job cuts announced by Lloyds Banking Group PLC UK:LLOY -3.02%   LYG -4.46%  at the end of June.

Strong franc hurting Swiss banks

UBS and Credit Suisse CH:CSGN -7.77%   CS -4.16% , which is cutting around 2,000 jobs, are facing an uphill battle against the soaring Swiss franc because they have such a big cost base in Switzerland, but receive a lot of their revenue in dollars and euros.



On top of that UBS CEO Oswald Gruebel made a significant effort to rebuild the firm’s fixed-income trading business in the wake of the crisis, but is now cutting back in areas where it’s not making money, said Christopher Wheeler, an analyst at Mediobanca.

“Ozzie is a trader and he’s taking a trader's view by cutting his positions,” said Wheeler.

HSBC Holdings PLC UK:HSBA +0.43%   HBC -0.20%  will cut around 30,000 positions by 2013, reflecting the fact that the bank “massively over-expanded in retail banking,” Wheeler added.

Soaring costs at HSBC have been a significant worry for investors for some time, leading the bank to announce in May that it will withdraw from markets where it can’t achieve the right scale. Read more on HSBC's cost-cutting plans. 
 

Societe Generale analyst James Invine said in a note to clients that costs are still “a mountain to climb” for HSBC and that much of the growth is due to wage inflation in its faster-growing markets.

“That is a cost about which it can do very little, particularly given Asia’s strategic importance for the group,” Invine said.

The Barclays cuts are a mix of trimming a bloated looking corporate banking arm and slimming down European retail banking, as well as trimming its Barclays Capital investment banking arm after some pretty aggressive expansion, said Wheeler.

Barclays was the bank that snapped up the U.S. operations of Lehman Brothers Holdings, including around 10,000 staff, after the U.S. firm collapsed in 2008.

“In bull markets, you can hide a lot,” he said.

“But when you get into these sort of markets you have to address it, because, it sticks out like a sore thumb.”

Simon Kennedy is the City correspondent for MarketWatch in London.

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HSBC Plc is reportedly close to announcing that it will cut thousands of jobs as it embarks on a cost-cutting drive. — Reuters

HSBC may cut 10,000 jobs

HONG KONG: HSBC Plc may cut more than 10,000 jobs as it embarks on a cost-cutting drive, Sky News reported, citing people close to Europe's biggest bank.

The bank's plans had not yet been finalised, Sky News added, citing an insider at the bank

A HSBC spokeswoman in Hong Kong declined to comment.

HSBC's move would be the latest in a wave of cuts announced by the global financial industry, which has been hit by market volatility and lacklustre profits.

Just yesterday, Swiss bank Credit Suisse announced it would cut about 2,000 jobs after a second quarter hit by weak trading activity and the strong Swiss franc.

 

Switzerland's second biggest bank saw net profit fell 52% to 768 million Swiss francs (US$958.9mil), it said on Thursday.

Standard Chartered, Lloyds, Goldman Sachs and UBS are among banks that have announced job cuts in recent months, hit by rising costs and weak revenue growth.

State Street Corp, one of the world's biggest institutional investors, said earlier this month it would eliminate as many 850 jobs from its technology unit as it tried to curb costs.

HSBC has about 330,000 employees worldwide.

The Sky report came after it said in May it was looking for sustainable cost savings of US$2.5bil to US$3.5bil in order to reach a cost efficiency ratio target of 48%-52% by 2013.

It also said it would be conducting a strategic review of its cards business in the United States, and would limit its retail banking operations to markets where it could achieve profitable scale.

It already cut 700 jobs in its UK retail banking arm in June this year out of its staff of 55,000 in the country, one of many banks that have said they will cull jobs to save costs as lenders fight off a limp economic recovery.

HSBC shares in Hong Kong were down 1.1% by noon yesterday, in line with the broader market's 1% decline. - Reuters

Big Banks Hit Hard In Market Sell-Off

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Big U.S. and European banks were hit hard in Thursday’s stock sell-off, highlighting investor concerns about some of the more prominent financial institutions.

In the U.S., Bank of America’s stock fell by 7.44% and has now tumbled by 33% this year. Bank of America’s chief executive, Brian Moynihan, will now really have his work cut out for him next week when he plans to take questions on a public call hosted by Bruce Berkowitz, the rock star hedge fund manager who has taken a big and controversial position in the nation’s biggest bank.

The KBW Bank Index fell by 5.3%, but some of the biggest banks in the U.S. fell more, like Citigroup, which fell by 6.6%. Big banks like Citigroup are struggling to deal with surging litigation costs stemming from the credit crisis while also dealing with more stringent capital standards.

The situation in Europe is worse, where investors are starting to wonder more and more about the Italian government securities being held by the large European banks, not to mention IOUs from the other countries like Spain. Italy is really getting more mired in the euro crisis and UniCredit shares tumbled by more than 9% on Thursday. Lloyds Banking Group has now seen its shares lose nearly half their value in 2011.

The decline in bank stocks could add momentum to the job cuts already being implemented on Wall Street and the banking sector. HSBC recently said it would slice 30,000 jobs. It will also potentially weigh on the economic recovery. But at least some banks are making the best of an ominous situation. Bank of New York Mellon said on Thursday it will start to charge clients fleeing to safety a fee for extraordinarily high deposits.