January 2009 - cypherpunks-legacy

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09 Jan '09

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The Straight Dope: How would I go about laundering money?
by R.A. Hettinga 09 Jan '09

09 Jan '09

<http://www.straightdope.com/columns/read/2836/how-would-i-go-about-launderin g-money > The Straight Dope - Fighting Ignorance Since 1973 Cecil Adams, the world's smartest human. How would I go about laundering money? January 9, 2009 Dear Cecil: Being the fount of all knowledge, could you tell me the best way to launder money? The information may come in useful one day. Ben Vicken, somewhere in Asia Cecil replies: I'm confident you're not contemplating anything illegal, Ben. However, it's helpful for us law-abiding folk to understand the workings of the criminal mind. So let's start at the beginning. Suppose you have a couple grocery bags full of ill-gotten cash. What do you do? You sure as hell don't just spend it Al Capone learned that the hard way when he was convicted of tax evasion. Modern bad guys understand that when large sums are involved, it's important to make the loot appear to have been legally acquired. Money laundering accomplishes this in three steps: (1) getting the money into the financial system, called "placing," (2) moving it around to hide the illegal taint, or "layering," and (3) commingling it with legitimate funds, known as "integrating." Casinos used to make it easy to do this. In the 1970s, one organized crime figure went into an Atlantic City casino with nearly $1.2 million in small bills (authorities figured it must have filled a sizable duffel bag), gambled some of it away, then cashed in $800,000 in chips for $100 bills (these would fit comfortably in an attache case), and, some days later, dumped the money into a Swiss bank. This kind of stunt would now likely attract unwanted attention, as current federal law requires casinos and other operations handling large amounts of cash to report suspicious transactions. Instead, you might try an approach called "smurfing" you break up your boodle into sums below the reporting threshold and arrange for proxies, or "smurfs," to deposit these into different checking accounts. In one infamous smurfing case a ring of middle-aged women placed over $25 million of Florida drug money into assorted California banks. Another common approach is to mix up nonkosher funds with the assets of a front company: any above-ground business that handles a lot of cash, such as a check-cashing service, travel agency, grocery store, car wash, or coin laundry. Alternatively, you might use a business with a hard-to-value inventory precious metals, jewelry, antiques, art, etc. Since law enforcement can't be sure how much money the business is supposed to have, the fake invoices or receipts you use to conceal your swag aren't conspicuous. As a variation on the phony-invoicing trick, you can arrange to purchase property well below market value and slip the cash difference to the seller. You then resell a few months later at the true value, getting that cash back as a perfectly legal profit any capital gains tax is just the cost of doing business. The cash you gave the original seller is his problem. The stock market is another good place to wash money. You invest small amounts of cash in the market, several times a day, through different brokerage firms. Brokers don't routinely talk to each other, so multiple accounts with different firms won't attract suspicion. If you use your front company to buy the stock, there's yet another level of complexity for the investigators to try to unwind. Once the money's in a bank, you want to further obscure the trail. Wire the cash to an offshore account somewhere with no tax on business or investment income and strict secrecy laws the Cayman Islands, the Channel Islands, Bermuda, Luxembourg, etc. Then your U.S. front company can take a "loan" from your Cayman Islands bank account. If the FBI asks where you got the million dollars, you tell them truthfully it's a bank loan, and you've got legal loan documentation to prove it. The money isn't taxable (it's a loan); when you repay the interest, you pay it to yourself and deduct it as a business expense while shipping even more money out of the country. So let's imagine a typical money-laundering scenario: (1) Make numerous below-the-radar deposits to accounts in different banks. (2) Consolidate the funds via wire transfer in a single account in, say. Tampa. (3) Wire that to a London bank. (4) Convert the funds to certificates of deposit. (5) Use those as collateral for a loan from a bank in the Cayman Islands. (6) Transfer the loan proceeds back to your front company in Tampa. Result: a confusing trail for the feds to follow, most of it electronic, with no need for small unmarked bills or other crime-fiction cliches. In short, money laundering has become a species of high finance. Some claim it's the third largest business in the world, behind legitimate currency transactions and the auto industry. It conceals some nasty enterprises criminal-finance experts estimate that more than two thirds of U.S. money-laundering prosecutions involve illegal drug dealing, and terrorists shuffle their share of cash as well. Then again, knowing what we do about many legal global transactions of late, you'd have to say it's not just the criminals in the financial marketplace who are up to no good. Cecil Adams

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09 Jan '09

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09 Jan '09

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Social networks link terrorists
by Eugen Leitl 08 Jan '09

08 Jan '09

(suuure) http://www.pcworld.idg.com.au/article/272364 Social networks link terrorists A new breed of cyberterrorists are using online forums to recruit people who support Al-Qaeda, creating global networks of would-be terrorists. Elizabeth Montalbano (IDG News Service) 08/01/2009 09:17:00 A new breed of terrorists are using online forums to recruit people who align themselves with the mission of Al Qaeda, creating global networks of would-be terrorists who pose a growing threat, a senior cyberterrorist researcher warned this week. Cyberterrorists are using a series of online forums and at least one social-networking site, PalTalk, to recruit people to their cause, Evan Kohlmann, a senior investigator and private consultant for Global Terror Alert, said at the International Conference on Cyber Security 2009 in New York. Many of these people never actually meet in person, but conspire online to launch both cyberterrorist and physical terrorist attacks such as suicide bombings, he said. Global Terror Alert is an online clearinghouse of information for counter-terrorist researchers, analysts and policymakers. Kohlmann also acts as a consultant to law-enforcement agencies on terrorist cases. At the conference, Kohlmann outlined Operation Praline, a sting operation in the U.K. that ultimately uncovered a would-be terrorist network in three countries led by Aabid Khan, a then-19-year-old Briton. Khan, who was arrested in June 2006 when he was returning from a trip to Pakistan, used online forums and chat rooms to "meet" people and essentially became "a terrorist recruiter using the Internet," Kohlmann said. When he was apprehended, law-enforcement officials had reason to believe he was planning to set off bombs in Washington, D.C., and New York. Khan, who promoted a "worldwide" war against people who did not support Al Qaeda, also was the ring-leader for other terrorist plots hatched in the U.K. and Canada; the perpetrators of those -- most notably a group of 17 men arrested in Toronto just before Khan's own arrest -- were apprehended before the acts were carried out. Khan used a series of so-called jihadi online forums where people who support Al Qaeda and aim to wage terrorist attacks share their ideas, Kohlmann said, calling these sites the "Facebook and MySpace" of cyberterrorists. Khan also encouraged mounting cyberattacks on people who did not support his viewpoint, he said. While his reference to social networks was meant as a comparison, people have actually used PalTalk, a chat-room hosting site, to host a live question-and-answer with people they alleged to be Al-Qaeda leaders, Kohlmann said. He said that he's not sure if the company "actually realizes what is going on with their chat rooms," but that the chat room in question is well known among members of jihadi forums. "In this case, we are particularly talking about a single chat room, with a slightly-changing-but-mostly-static identifiable name, accessible via the official PalTalk chat room index," he said via e-mail a day after his presentation in New York. "This chat room has been routinely advertised on jihadi Web forums, and it is used on a day-to-day basis to trade download links for Al Qaeda propaganda videos [and] terrorist instructional manuals ... If the company hasn't gotten a hint of any of this by now, then they really need to start re-considering their security policies." Judy Shapiro, vice president of marketing for New York-based PalTalk, said the company is aware that there are Al Qaeda-focused rooms on its site, but if the chat occurring within those rooms does not violate the company's terms of service for troublesome language, freedom of speech applies. "We absolutely shouldn't discriminate," she said. "We can't constrain people's ability to say what they want. If someone says, I am the head of Al Qaeda, come talk to me, that's perfectly legal." In its terms of service, PalTalk lists "unacceptable conduct" that would violate those terms as "threatening, harassing, or intimidating another user" or "transmitting any unlawful, threatening, abusive, profane, offensive, defamatory, or hateful text or voice communication or images or other material, or any racially, ethnically or otherwise objectionable material, or any material that violates or infringes the intellectual property or privacy or publicity or other rights of any other party," among other kinds of behavior. PalTalk will take down a chat room with no warning if users report trouble to its moderators. "If someone said, how do I create a bomb I can [detonate] in Times Square," that would obviously raise a red flag, Shapiro said. In cases where "the level of language" would warrant an investigation, PalTalk would take whatever steps necessary to cooperate with law-enforcement officials or take down the site or both if there is good reason, she said. In the meantime, others are doing their own part to take down jihadi Web forums, Kohlmann said. More than five of the top jihadi Web forums -- including ones called Al-Ekhlaas, Al-Hesbah, Al-Firdaws and Al-Boraq -- have been knocked offline since September, and several others that are still live such as Al-Shamikh, Majahden, and Al-Faloja "are suffering periodic blackouts which can last anywhere from several hours to a week in length," he said in the e-mail. However, "you knock one out, another one pops up the next day," Kohlmann said at the conference, so just taking down the sites is not an effective way to stop cyberterrorists and would-be accomplices from meeting via online forums. He thinks the real way for law-enforcement officials to hamper cyberterrorists and would-be accomplices using these sites is to join them and cause confusion and mistrust among their ranks. "Infiltrating the system is most effective," he said. "People don't know if you're a real jihadi or an agent. These people have never met each other and if you give them a reason not to trust each other, that's all it takes" to disrupt their activities.

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08 Jan '09

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CodeCon 2009 Call for Presentations
by Len Sassaman 07 Jan '09

07 Jan '09

CodeCon 2009 April 17-19, 2009 San Francisco CA, USA www.codecon.org Call For Presentations CodeCon is the premier showcase of cutting edge software development. It is an excellent opportunity for programmers to demonstrate their work and keep abreast of what's going on in their community. All presentations must include working demonstrations, ideally accompanied by source code. Presentations must be done by one of the active developers of the code in question. We emphasize that demonstrations be of *working* code. We hereby solicit papers and demonstrations. * Papers and proposals due: February 15, 2009 * All Authors notified: March 1, 2009 Possible topics include, but are by no means restricted to: * community-based web sites - forums, weblogs, personals * development tools - languages, debuggers, version control * file sharing systems - swarming distribution, distributed search * security products - mail encryption, intrusion detection, firewalls * malware analysis - detection, compensation, and mitigation of emerging threats -- As a new feature this year, CodeCon will be presenting a Biohack! track. While we will continue our tradition of presenting only one talk at a time, a portion of one of the days' talks will be reserved for interesting biotechnology hacking projects. A key requirement for these presentations is ease of reproduction with minimal access to expensive laboratory equipment. Example topics include: * Purifying DNA using common household items * Developing genetically-modified bacteria in a kitchen laboratory * Using specially-designed software to assist in bioengineering * The use of simple bioengineering techniques to solve real-world problems. Ideal Biohack! Track submissions will have a strong emphasis on the "hack" portion of the talk -- in the last few years, there has been a strong growth in the community of biology hackers; we aim to bring these hackers together to discuss their techniques for inexpensive, at home experimentation in biological engineering research. -- Presentations will be 30 minutes long, with an additional 15 minutes allocated for Q&A. Overruns will be truncated. Submission details: Submissions are being accepted immediately. Acceptance dates are February 7th and March 1st. After the first acceptance date, submissions will be either accepted, rejected, or deferred to the second acceptance date. The conference language is English. The conference venue is open to all ages. Ideally, technical demonstrations should be usable by attendees with 802.11b connected devices either via a web interface, or locally on Windows, UNIX-like, or MacOS platforms. Cross-platform applications are most desirable. Biohacking demonstrations should be viewable with a presenter-provided camera, or prepared movies for projection. To submit, send mail to submissions-2009(a)codecon.org including the following information: * Project name * Code track or Biohack! track * url of project home page * tagline - one sentence or less summing up what the project does * names of presenter(s) and urls of their home pages, if they have any * one-paragraph bios of presenters, optional, under 100 words each * project history, under 150 words * what makes the project novel -- how it differs from similar projects * what will be done in the project demo, under 200 words * slides to be shown during the presentation, if applicable * future plans General Chairs: Jonathan Moore and Bram Cohen Program Chair: Jered Floyd and Len Sassaman Program Committee: * Jon Callas, PGP, USA * Bram Cohen, BitTorrent, USA * Roger Dingledine, The Tor Project, USA * Jered Floyd, Permabit, USA * Ben Laurie, Google, UK * Nick Mathewson, The Tor Project, USA * David Molnar, University of California, Berkeley, USA * Jonathan Moore, Mosuki, USA * Meredith L. Patterson, Osogato, USA * Andrew S. Peek, Integrated DNA Technologies, USA * Len Sassaman, Katholieke Universiteit Leuven, BE * Cliff Skolnick * Paul Syverson, Naval Research Laboratory, USA * [Others may be added] Sponsorship: If your organization is interested in sponsoring CodeCon, we would love to hear from you. In particular, we are looking for sponsors for social meals and parties on any of the three days of the conference, as well as sponsors of the conference as a whole and donors of door prizes. If you might be interested in sponsoring any of these aspects, please contact the conference organizers at codecon2009(a)codecon.org Press policy: CodeCon provides a limited number of passes to qualifying press. Complimentary press passes will be evaluated on request. Everyone is welcome to pay the low registration fee to attend without an official press credential. Questions: If you have questions about CodeCon, or would like to contact the organizers, please mail codecon2009(a)codecon.org. Please note this address is only for questions and administrative requests, and not for workshop presentation submissions.

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