Start Up No.1475: how vengeful people ruin online reputations, the fake Huawei influencers, ransomware gang shuts down, and more


We have a definitive explanation for why RobinHood blocked purchases of Gamestop stock, despite demand. CC-licensed photo by Dicoplio Family on Flickr.

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A selection of 11 links for you. Part 2 of 12. I’m @charlesarthur on Twitter. Observations and links welcome.

A vast web of vengeance • The New York Times

Kashmir Hill on a man who found himself defamed online, and while digging in to :

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Mr. Babcock stared at the photo in shock. He hadn’t seen it in decades, but he recognized it instantly. The woman’s name was Nadire Atas; this was her official work portrait from 1990, when she worked in a Re/Max real estate office the Babcock family owned outside Toronto. She had initially been a star employee, but her performance deteriorated, and in 1993 Mr. Babcock’s father had fired her. Afterward, she had threatened his father, according to an affidavit filed in a Canadian court.

Mr. Babcock felt lightheaded. A memory came back to him: When his mother died in 1999, the family had received vulgar, anonymous letters celebrating her death. A neighbor received a typed letter stating that Mr. Babcock’s father “has been seen roaming the neighbourhood late at night and masturbating behind the bushes.” The Babcocks had suspected Ms. Atas, who was the only person who had ever threatened them. (Ms. Atas denied making threats or writing the letters.)
Decades later, it appeared that she was still harboring her grudge — and had updated her methods for the digital age.

…These situations — where one angry person targets a large group of perceived enemies — are not uncommon. Maanit Zemel, a lawyer who specializes in online defamation, represents a group of 53 people who have filed a lawsuit saying they were attacked online by Tanvir Farid after he failed to get jobs at their companies. (Mr. Farid’s lawyer declined to comment.)

For victims, these sorts of attacks “can literally end their life and their career and everything,” Ms. Zemel said.

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You don’t have to read much further before you begin wondering about a mental health test for people who want to post stuff on the internet.

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Inside a pro-Huawei influence campaign • The New York Times

Adam Satariano:

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First, at least 14 Twitter accounts posing as telecommunications experts, writers and academics shared articles by Mr. Vermulst and many others attacking draft Belgium legislation that would limit “high risk” vendors like Huawei from building the country’s 5G system, according to Graphika, a research firm that studies misinformation and fake social media accounts. The pro-Huawei accounts used computer-generated profile pictures, a telltale sign of inauthentic activity.

Next, Huawei officials retweeted the fake accounts, giving the articles even wider reach to policymakers, journalists and business leaders. Kevin Liu, Huawei’s president for public affairs and communications in Western Europe, who has a verified Twitter account with 1.1 million followers, shared 60 posts from the fake accounts over three weeks in December, according to Graphika. Huawei’s official account in Europe, with more than five million followers, did so 47 times.

The effort suggests a new twist in social media manipulation, said Ben Nimmo, a Graphika investigator who helped identify the pro-Huawei campaign. Tactics once used mainly for government objectives — like Russia’s interference in the 2016 American presidential election — are being adapted to achieve corporate goals.

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The use of AI-generated faces for this stuff is so prevalent. Of course, computer networks can’t detect them because the adversarial networks used to generate them spend half their time trying to detect fakes. Huawei hasn’t acknowledged this being its own work.
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Exclusive: China’s Huawei in talks to sell premium smartphone brands P and Mate – sources • Reuters

Julie Zhu, Yingzhi Yang and David Kirton:

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China’s Huawei Technologies Co Ltd is in early-stage talks to sell its premium smartphone brands P and Mate, two people with direct knowledge of the matter said, a move that could see the company eventually exit from the high-end smartphone-making business.

The talks between the world’s largest telecommunications equipment maker and a consortium led by Shanghai government-backed investment firms have been going on for months, the people said, declining to be identified as the discussions were confidential.

Huawei started to internally explore the possibility of selling the brands as early as last September, according to one of the sources. The two sources were not privy to the valuation placed on the brands by Huawei.

Shipments of Mate and P Series phones were worth $39.7bn between Q3 2019 and Q3 2020, according to consultancy IDC.

However, Huawei has yet to make a final decision on the sale and the talks might not conclude successfully, according to the two sources, as the company is still trying to manufacture at home its in-house designed high-end Kirin chips which power its smartphones.

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China smartphone market declines 11% in 2020 as Huawei unable to revive supply • Canalys

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The smartphone market in Mainland China finished 2020 with 84 million units shipped in Q4 2020, declining 4% year-on-year. That meant for the full year, the China market declined 11% to arrive at just over 330 million units, as market recovery was stalled by the rapid deterioration of Huawei’s performance as a result of US sanctions.

For Q4 2020, Huawei (including Honor) managed to ship 18.8 million units, and its market share declined to 22% from 41% in Q3 2020. Oppo rose rapidly into second place, shipping 17.2 million smartphones, growing 23% year-on-year. Vivo also showed strong year-on-year growth at 20%, and came in third at 15.7 million units. Apple also reported its best performance in China in recent years, shipping more than 15.3 million units in Q4, with 18% market share, up from 15% in Q4 2019. Xiaomi completed the top five, shipping 12.2 million units, growing 52% year-on-year.

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Huawei’s loss very much Apple’s gain, especially as it was one of those years when also had a new phone design, which always helps sales.
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FonixCrypter ransomware gang releases master decryption key • ZDNet

Catalin Cimpanu:

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The cybercrime group behind the FonixCrypter ransomware has announced today on Twitter that they’ve deleted the ransomware’s source code and plan to shut down their operation.

As a gesture of goodwill towards past victims, the FonixCrypter gang has also released a package containing a decryption tool, how-to instructions, and the ransomware’s master decryption key.

These files can be used by former infected users to decrypt and recover their files for free, without needing to pay for a decryption key.

Allan Liska, a security researcher for threat intelligence firm Recorded Future, has tested the decrypter at ZDNet’s request earlier today and verified that the FonixCrypter app, instructions, and master key work as advertised.

“The decryption key provided by the actors behind the Fonix ransomware appears to be legitimate, thought it requires each file to be decrypted individually,” Liska told ZDNet.

“The important thing is that they included the master key, which should enable someone to build a much better decryption tool,” he added.

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All of this is very mysterious: why would an otherwise successful gang suddenly shut up shop and release their source code? Suggestions rolling around are that they’re either worried about imminently getting their collars felt; or they got hacked by a rival group.
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Suspected Russian hack extends far beyond SolarWinds software, investigators say • WSJ

Robert McMillan and Dustin Volz:

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Close to a third of the victims didn’t run the SolarWinds software initially considered the main avenue of attack for the hackers, according to investigators and the government agency digging into the incident. The revelation is fueling concern that the episode exploited vulnerabilities in business software used daily by millions.

Hackers linked to the attack have broken into these systems by exploiting known bugs in software products, by guessing online passwords and by capitalizing on a variety of issues in the way Microsoft’s cloud-based software is configured, investigators said.

Approximately 30% of both the private-sector and government victims linked to the campaign had no direct connection to SolarWinds, Brandon Wales, acting director of the Cybersecurity and Infrastructure Security Agency, said in an interview.

The attackers “gained access to their targets in a variety of ways. This adversary has been creative,” said Mr. Wales, whose agency, part of the U.S. Department of Homeland Security, is coordinating the government response. “It is absolutely correct that this campaign should not be thought of as the SolarWinds campaign.”

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Think they’re stuck with the name. This seems to be a much, much, much bigger deal than anyone realised, which probably means that this will pretty much be the last we hear of it. It’s going to be one for the espionage world.
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The machine stops • The New Yorker

Oliver Sacks wrote this in 2014, before he died, but it wasn’t published until February 2019:

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A few years ago, I was invited to join a panel discussion about information and communication in the twenty-first century. One of the panelists, an Internet pioneer, said proudly that his young daughter surfed the Web twelve hours a day and had access to a breadth and range of information that no one from a previous generation could have imagined. I asked whether she had read any of Jane Austen’s novels, or any classic novel. When he said that she hadn’t, I wondered aloud whether she would then have a solid understanding of human nature or of society, and suggested that while she might be stocked with wide-ranging information, that was different from knowledge. Half the audience cheered; the other half booed.

Much of this, remarkably, was envisaged by E. M. Forster in his 1909 story “The Machine Stops,” in which he imagined a future where people live underground in isolated cells, never seeing one another and communicating only by audio and visual devices. In this world, original thought and direct observation are discouraged—“Beware of first-hand ideas!” people are told. Humanity has been overtaken by “the Machine,” which provides all comforts and meets all needs—except the need for human contact. One young man, Kuno, pleads with his mother via a Skype-like technology, “I want to see you not through the Machine. . . . I want to speak to you not through the wearisome Machine.”

He says to his mother, who is absorbed in her hectic, meaningless life, “We have lost the sense of space. . . . We have lost a part of ourselves. . . . Cannot you see . . . that it is we that are dying, and that down here the only thing that really lives is the Machine?”

This is how I feel increasingly often about our bewitched, besotted society, too.

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Douglas Adams described this first. (The sad thing is that we can’t have any new Douglas Adams aphorisms.)
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China is now sending Twitter users to prison for posts most Chinese can’t see • WSJ

Chun Han Wong:

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Chinese authorities have sentenced more than 50 people to prison in the past three years for using Twitter and other foreign platforms—all blocked in China—allegedly to disrupt public order and attack party rule, according to a Wall Street Journal examination of court records and a database maintained by a free-speech activist.

The growing use of prison sentences marks an escalation of China’s efforts to control narratives and strangle criticism outside China’s cloistered internet. In the past, the suppression of views on foreign social media was enforced mostly through detentions and harassment, rarely by imprisoning people, human-rights activists say.

Courts records cited offending speech ranging from criticism of state leaders and the Communist Party to discussions of Hong Kong, the northwestern region of Xinjiang, and the democratically ruled island of Taiwan, which Beijing claims as its territory. Among those whose Twitter accounts remained online or whose followings were cited in court records, their followers typically numbered in the hundreds or low thousands, though one had fewer than 30 followers when he was detained.

…Later that month, three men dressed as neighborhood volunteers showed up at Mr. Zhou’s apartment, saying they wanted to discuss pandemic controls. When he opened the door, the men rushed in along with seven uniformed police officers, pressed him onto the ground, and then took him away for interrogation about his Twitter use, he said.

Even though Mr. Zhou said he had only about 300 followers when he was detained, a local court ruled in November that he had egregiously damaged social order and handed him a nine-month prison sentence. “I felt helpless and indignant,” he said.

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Financial presentation of Alzheimer disease and related dementias • JAMA Network

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Question: are Alzheimer disease and related dementias (ADRD) associated with adverse financial outcomes in the years before and after diagnosis?

Findings: In this cohort study of 81,364 Medicare beneficiaries living in single-person households, those with ADRD were more likely to miss bill payments up to six years prior to diagnosis and started to develop subprime credit scores 2.5 years prior to diagnosis compared with those never diagnosed. These negative financial outcomes persisted after ADRD diagnosis, accounted for 10% to 15% of missed payments in our sample, and were more prevalent in census tracts with less college education.

Meaning: Alzheimer disease and related dementias were associated with adverse financial events starting years prior to clinical diagnosis.

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A comment on that page from someone who used to work in consumer fraud says that this matches what they see exactly: the inability to spot a scam often precedes a clear onset of Alzheimer’s by a handful of years.
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What’s happening with RobinHood? By @compound248 on Twitter • Thread Reader App

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Dear Media,

What’s happening with RobinHood?

A quick primer.

This is a “plumbing” issue. It is esoteric, even for those on Wall Street.

A very long thread on how the toilet is clogged

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This is also well-explained if you’re prepared to concentrate. Key points are that if you think you’re “buying” stock in RobinHood, actually you’re not – RobinHood owns it. And systems put in place to prevent a repeat of the Lehman Brothers domino effect is what got RobinHood into trouble.

Plus it was made even worse by margin trading on options, which have the ability to make things calamitous rather than just awful. RobinHood itself finally added a “you probably won’t understand this” blogpost to explain things, but the thread above is better.
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Robinhood, in need of cash, raises $1bn from its investors • The New York Times

Kate Kelly, Erin Griffith, Andrew Ross Sorkin and Nathaniel Popper:

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On Thursday, Robinhood was forced to stop customers from buying a number of stocks, like GameStop, that were heavily traded this week. To continue operating, it drew on a line of credit from six banks amounting to between $500m and $600m to meet higher margin, or lending, requirements from its central clearing facility for stock trades, known as the Depository Trust & Clearing Corporation.

Robinhood still needed more cash quickly to ensure that it didn’t have to place further limits on customer trading, said two people briefed on the situation, who asked to remain anonymous because the negotiations were confidential.

Robinhood, which is privately held, contacted several of its investors, including the venture capital firms Sequoia Capital and Ribbit Capital, which came together on Thursday night to offer the emergency funding, five people involved in the negotiations said.

“This is a strong sign of confidence from investors that will help us continue to further serve our customers,” Josh Drobnyk, a Robinhood spokesman, said in an email. Sequoia and Ribbit declined to comment.

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Robinhood’s PR is absolutely awful. It talks with marbles in its mouth. The message on the app – “let the people trade” – is simple. But everything is much more complicated than it makes out, and that hurts it as soon as the complexity begins intruding.
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Errata, corrigenda and ai no corrida: none notified

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