Friday, 30 September 2016

POST 007.com

It’s really hard to be James Bond these days. Apart from health & safety restrictions on the use of poison umbrellas and the legal restrictions of the murder of foreign-looking goons, and all the paperwork around the expenses, you’ll be rumbled in an instant by your Facebook account. Because you don’t have one.

It is not simply a question of keeping details offline, either, but the opposite: individuals or identities without deep, broad online presences are precisely those likely to raise suspicion. “The challenge of having a credible digital footprint is significant,” Mr Inkster said. Fake Twitter or Facebook accounts alone do not make the grade.

From The spy who liked me: Britain’s changing secret service - FT.com

If I come across someone in a work context, and they are not on LinkedIn, then I assume that they are either in the witness protection programme or have been in prison. And of course if you are not yourself on Facebook, then it’s only a matter of time before some schmuk snaps you and you’re in the system. You could be out and about with an important business contact having a very important business discussion about important business issues, for example, but because of the camera angle and the perspective a snapshot of this event might be entirely misconstrued.

And once you’re in the system, you are no longer anonymous whatever you might think about being off the grid.

Give Facebook two pictures, and it can tell you with 97 percent accuracy whether they're the same person, roughly the same accuracy as a human being in the same spot.

[From Why Facebook is beating the FBI at facial recognition | The Verge]

The old spies had to stake you out and track you down and stalk you and then murder you in a dastardly fashion. Now they just run the face recognition software until you pop up somewhere and then… it’s radioactive sushi time. Until my plan for Facebook-blue burkhas for all is accepted by the mainstream I’m afraid I can no way rounds. By the way, I noticed in the newspapers that while it may be increasingly difficult for spies to convince people that they are not spies, it is apparently much easier for people to people other people that they are spies.

Mark Acklom convinced her he was a spy and defrauded her of £850,000 

From Gloucestershire woman fell for 'charismatic' fraudster who claimed he worked for MI6 | Daily Mail Online

I don’t want to pick on this poor woman, and I know only too well how easily women can fall under the spell of handsome and charismatic Englishmen, but had she never heard of LinkedIn? If a match.com counterparty was trying to convince me that they are from MI6, I would fully expect to open up their LinkedIn profile and see a convincing employment narrative going back many years. And if they didn’t have a Facebook profile, then I’d naturally assume them to be a fraudster. 

Spies are an interesting use case when you start to think about the series business of population-sale identity they present a problem. If the purpose of a national identity system is to uniquely identity someone, then you don’t want it to ping back “James Bond” when 007 has to use the biometric identification system at the casino entrance.

Wednesday, 28 September 2016

VocaLink Connect - Review from SIBOS - Day 1

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According to [Claus Richter from Nordea], while it is impossible to know exactly what a successful revenue model will look like in an Open Banking world, there are number of possibilities ranging from existing transaction fee-based models to licensing deals with fintech firms.

From VocaLink Connect - Review from SIBOS - Day 1

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Monday, 26 September 2016

What if ‘One Click’ Buying Were Internetwide? - NYTimes.com

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“There’s a convergence going on,” said Mr. Birch, who currently works for Consult Hyperion. “In the future you will have one experience — it won’t matter if you are at the store or on the phone. It will pop up on your phone, you will put your thumb on it and you will be done.”

From What if ‘One Click’ Buying Were Internetwide? - NYTimes.com

Currently? What does Nathaniel Popper know that I don’t? Anyway, 

'I'm not dead,' Central Florida man says

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Miller is one of nearly 10,000 living Americans who are erroneously reported dead to the Social Security Administration (SSA) each year.

In most cases, the citizens' names, birth dates and Social Security numbers are mistakenly entered into SSA's master death file, a computer database used by government agencies, financial institutions, medical researchers and genealogists.

From 'I'm not dead,' Central Florida man says

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Sunday, 25 September 2016

Hanging at the hackathon

The wonderful people at WorldPay had a hackathon, and Consult Hyperion (along with the Visa Collab and MongoDB) were one of the sponsors of the event, so I got to be a judge too. It was, I have to say, great fun.

WorldPay Hackathon

You can see some of photos from the event here. There were 140+ “hackers” supported by mentors from WorldPay and the sponsor. The mentors helped the hackers to understand and use the WorldPAy IoT API so that they could get going on their ideas.

WorldPay Hackathon

I went along to help to get things going along with my Consult Hyperion colleagues Matt and Stefan.

WorldPay Hackathon

We’d had brought along a 3D printer for the hackers to use, so Matt gave a Friday night tutorial on how to create digital 3D objects and get them turned into actual physical objects. Pretty cool.

WorldPay Hackathon

The hackers had more tutorials on Saturday  then they had the rest of Saturday and Sunday morning to develop their ideas. I cam back on the Sunday to join with the rest of the judging team. Here I am with Nick from WorldPay getting started on the judging process.

WorldPay Hackathon

I won’t steal WorldPay’s thunder but announcing who the winners and runners up were here, you can see this over at their web site.

Neha Narula: The future of money | TED Talk Subtitles and Transcript | TED.com

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we won't even feel like we're transacting anymore

From Neha Narula: The future of money | TED Talk Subtitles and Transcript | TED.com

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Neha Narula: The future of money | TED Talk Subtitles and Transcript | TED.com

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We're about to enter a new phase of money. The future of money is programmable.

From Neha Narula: The future of money | TED Talk Subtitles and Transcript | TED.com

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Kenya's Cashless Payment System For Public Transport Was Doomed By A Series Of Experience Design Failures

For anyone interested in the evolution of electronic money and the intersection between digital financial services and the real world, Kenneth Odero has written a superb study of the failure of the Kenya’s attempt at cashless public transport. I won’t quote the key points - I urge you to read the whole - but I will draw your attention to his key conclusion.

In this context, it is therefore not surprising that the uptake of electronic ticketing has failed to take off. Despite the convenience it brings to the commuters, the system has a critical design flaw - it could not work considering the power structures that exist around the public transport system.

From Kenya's Cashless Payment System For Public Transport Was Doomed By A Series Of Experience Design Failures

Money is not a neutral actor. Replacing dumb money with smart money changes power structures.

Saturday, 24 September 2016

Biometric Skimmers Pose Emerging Threat To ATMs

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In an report this week, researchers at Kaspersky Lab said they discovered at least 12 underground sellers offering skimming devices capable of stealing fingerprints from ATMs enabled with fingerprint scanners.  

From Biometric Skimmers Pose Emerging Threat To ATMs

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5 reasons why cash doesn’t go out of fashion | Banking.com

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According to the latest PYMNTS.com Global Cash Index, cash is the most widely accepted method of payment in the biggest Western European economies, where €2.1 trillion of cash transactions were completed last year.

From 5 reasons why cash doesn’t go out of fashion | Banking.com

Well, it might be the most widely accepted but it’s no longer the most widely used.

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According to the new research, consumer card payments will surpass cash payments for the first time in 2016, registering USD $23.1 trillion globally.

From Consumer Card Transactions Overtake Cash Payments for the First Time in 2016 | Business Wire

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126 million coins taken out of circulation since rounding scheme introduced - BelfastTelegraph.co.uk

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But now Mark Carney, the Governor of the Bank of England, has suggested that the 1,200-year-old British penny could be scrapped.

From After 1,200 years, could it really be time for the penny to be dropped?

Actually, I’ve suggested it more than once but just because he’s the Governor of the Bank of England his plagiarised proposal gets all the attention.

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Some 126 million coins have been taken out of circulation since a scheme was introduced to round shoppers' bills up or down.

From 126 million coins taken out of circulation since rounding scheme introduced - BelfastTelegraph.co.uk

Ireland can do it, why can’t we?

Tuesday, 20 September 2016

4.5m debit or credit cards cancelled after fraud, study shows | Daily Mail Online

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Nearly a third (31%) of those who were defrauded reported falling victim to a hack which occurred when making a payment online. O ne in 10 (10%) had their card duplicated at an ATM and a small proportion (8%) said they had been hacked when making a contactless payment.

From 4.5m debit or credit cards cancelled after fraud, study shows | Daily Mail Online

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Monday, 19 September 2016

The immutable blockchain. No, wait...

Now we all know what the bitcoin blockchain is, don’t we? It’s a particular kind of shared ledger that uses a particular kind of communications protocol to obtain a particular kind of consensus about a particular kind of content. Right? And it’s just one particular version of the general class of blockchains, which share the characteristics that data is stored in blocks and because of some cryptographic jiggery-pokery the blocks are chained together, so that you can’t go back and change the contents of a block without having to then change the contents of every subsequent block. And depending on the consensus protocol that is used, you can’t change the blocks without everyone else agreeing to let you do it.

Whereas auditing at present entails the confirmation of transactions and balances on a company’s accounting ledger at the end of the period, a transaction on the blockchain would provide a permanent and immutable record of the transaction almost immediately.

From Blockchain and the Auditing Revolution – Real Time Audit within the Capabilities of Blockchain | Fintech Schweiz Digital Finance News – FintechNewsCH

The reason that this kind of structure is called immutable is that people imagine it to be computationally infeasible to go back post-consensus and make a change. In theory you could. If you had enough computational power, more than half of the “hashing power” in the case of bitcoin, you could in theory go back to the very first block, change it to send the bitcoins in it to yourself, and then go forward rewriting all of the subsequent blocks. You could treat all of the bitcoin transactions up until now as the wrong side of a fork. As my good friend Gideon Greenspan pointed out to me, just because you could see that corrupt agents were rewriting history in this way it doesn't mean that you could stop them.

If you had a different kind of blockchain, however, you could design it work in a different way. This is what some researchers in the US and Italy did in a paper called “Redactable Blockchain, or Rewriting History in Bitcoin and Friends” (5th August 2016). Giuseppe Ateniese, Bernado Magri, Daniele Venturi and Ewerton Andrade say: 

We put forward a new framework that makes it possible to re-write and/or compress the content of any number of blocks in decentralized services exploiting the blockchain technology. As we argue, there are several reasons to prefer an editable blockchain, spanning from the necessity to remove improper content and the possibility to support applications requiring re-writable storage, to “the right to be forgotten”.

Our approach generically leverages so-called chameleon hash functions (Krawczyk and Rabin, NDSS ’00), which allow to efficiently determine hash collisions given a secret trap- door information. We detail how to integrate a chameleon hash function in virtually any blockchain-based technology, for both cases where the power of redacting the blockchain content is in the hands of a single trusted entity and where such a capability is distributed among several distrustful parties (as is the case in Bitcoin). 

Thus, you can use some clever maths to rewrite a block without having to go forward and rewrite all subsequent blocks. The well-known and well-respected outsourcing company Accenture has filed a patent on this idea with Professor Ateniese.

By allowing a central administrator to amend or delete information stored on a blockchain, the [outsorucing company, Accenture] says that its prototype will make the technology more attractive to the financial services industry.

From Accenture to unveil blockchain editing technique - FT.com

This announcement was met with widespread derision on social media, and I can understand why. The whole point of blockchain technology in financial services is to make an immutable record of transactions. If you can go back and edit it, then it’s not really a blockchain any more, just another kind of database. Now, I can see why some people might want an accounting system that works this way (see, for example, the case of Kingfisher Airlines in India) but I wouldn’t have thought that society wants accounting systems that work this way at all.

But what is the requirement? Why would you want a ledger that can be amended by some central authority? I can think of a few reasons, but none of them make any sense.

The financial services industry needs to face the question of how to balance the appeal of pristine accounting with the demands of the real world, where some things simply need to be struck from the records.

From Downside of Bitcoin: A Ledger That Can’t Be Corrected - The New York Times

Nothing ever needs to be “struck from the records”. If a bank makes a mistake — let’s say it accidentally open a couple of million bogus accounts — then it can’t just go back and scrub the backup tapes and pretend it never happened. The way to correct a wrong debit is with a correct credit. The Financial Times quotes blockchain entrepreneur and serious player Blythe Masters, the former JPMorgan banker running Digital Asset Holdings, as saying of Accenture's approach that “we think it is innovative and can strike the right balance between preserving blockchain’s key features and adapting it for real-world requirements within some permissioned systems.” But what requirements are these? My reading of the paper from an amateur and inexpert perspective, is that it does not deliver against real-wrold requirements for permissioned systems in financial markets.

The use cases that are set out in the paper are the need to remove child pornography from a public blockchain, the “right to be forgotten” and the need to consolidate records financial transactions.

As for the first use case, this is not something that our clients need consider since none of them are proposing to implement critical national financial infrastructure on a public blockchain with arbitrary content controlled by unaccountable consensus group. If, for example, a stock exchange were to implement a blockchain settlement system, it would not be of such a type as to allow members of the general public to store child pornography on it (or at least it wouldn’t be if it had people such as Consult Hyperion designing it).

What’s more, if a stock exchange were implemented in this way, it would be utterly chaotic since at the execution of any transaction, no-one could be certain about the state of the ledger since it would be possible for some future intervention to change it. My granny dies and leaves me IBM shares. I sell you my IBM shares. I use the money to buy a car. Then a decade later a court order overturns my granny’s will as it turns out she had a son that we’d never heard of. So we go back and change the blockchain so that the IBM shares belong to him instead of me. So now I didn’t have the money to buy the car. So I have to give the car back. But the car was scrapped… and so on. Interstellar overdrive… then I go back five years later because it turns out he wasn’t her son at all and now I want the blockchain changed to give me my IBM shares…

Richard Lumb, global head of financial services at Accenture, told the Financial Times that financial institutions and regulators would need a means to quickly correct errors on the blockchain before using it in securities markets. He gave the example of a “fat finger” trading error, or a trade assigned to the wrong counterparty.

From Accenture to unveil blockchain editing technique - FT.com

That’s not how you correct errors, by just rubbing out mistakes. These are regulated financial institutions, not the mafia. No-one is going to build a financial services market on top of a mutable blockchain. In one of the comments I saw about this proposal, someone said that it would be OK because the market participants would keep and audit log of the changes and who agreed them. I thought that perhaps such an important log might need to be stored on an immutable ledger. Uh oh, blockchain Inception

As for the next use case, I am not a lawyer, but I think that the paper misinterprets the so-called “right to be forgotten”. However misguided the European Court’s decision on this might be, it does not demand the rewriting of history. If you publish an article about me that I don’t like, and I manage to persuade Google that it should be harder to find, then the article is not deleted. The link to the article is removed from Google search results but the article is still there. Newspapers are not required to go back and tear out articles from their archives, they are exempt (but in Europe, Google opted not to be regulated as media company so is not exempt). And I’m sure none of us what would to live in a world where politicians could obtain court order to go back a change the historical record!

The third use case, the consolidation of financial records is not clear to me at all. Since the invention of double-entry bookkeeping, the whole point of keeping a ledger has been that you have a record of all of the credits and debits that contribute to the current world view.

Tuesday, 13 September 2016

Money bag: Police raid on anti-corruption official uncovers over $120mn in cash — RT News

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Police arrested Dmitry Zakharchenko, the deputy head of the Energy Industry Department of the General Administration of Economic Security and Combating the Corruption (GAESCC), after the operation.

According to investigators, police seized a sum of some $120 million and € 2 million ($2.2 million).

From Money bag: Police raid on anti-corruption official uncovers over $120mn in cash — RT News

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Sunday, 11 September 2016

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t is likely that Kenyans will continue their preference for mobile money over debit cards over the next several years. Lafferty forecasts that, by 2018, the annual value of mobile payments will reach $57.7 billion, while total debit card billed volume will amount to $14.6 billion.

By the end of 2015, there were an estimated 27 million mobile money customers in Kenya – in context, the adult population is 25.5 million. The annual value of mobile payments reached $27 billion in 2015 – equivalent to 45.7 percent of Kenya’s GDP – with an average of 41 transactions per customer per annum and an average transaction value of $24.

From

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Tuesday, 6 September 2016

PayPal enables contactless withdrawal at 70k US ATMs - IBS Intelligence

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Paydiant, a subsidiary of PayPal, is launching a QR-based system that allows users to withdraw contactless cash from ATMs. The scheme will roll-out to more than 70,000 ATMs across the US, with customers being able to order cash through a mobile wallet app and then generate a QR code to use at the ATM.

From PayPal enables contactless withdrawal at 70k US ATMs - IBS Intelligence

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Monday, 5 September 2016

SunLive - You wave and we all pay - The Bay's News First

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Bruce was changing his business point of sale system. The system suppliers told him Eftpos would be free, the direct debit card – which he says few people use – would also be free, but payWave would be about 1.35 per cent and credit transactions cards even more expensive.

From SunLive - You wave and we all pay - The Bay's News First

I’m off down to New Zealand shortly because the nice people at PaymentsNZ have invited to me to deliver a keynote at their 2016 conference.

'Settlement Coin' is All About Banks, Not Blockchain - CoinDesk

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Bank reserves can't be used for settlement on a permissioned blockchain: they can only be used for settlement via a central bank RTGS system. In contrast, our Utilities Settlement coins – we assume – would be used for settlement on a permissioned blockchain collectively owned and managed by the consortium…. why would this arrangement be of interest to a bunch of banks? What advantages would it give them over existing central bank RTGS systems?

From 'Settlement Coin' is All About Banks, Not Blockchain - CoinDesk

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Sunday, 4 September 2016

The Regulatory Sandbox | Ariadne Plaitakis | Pulse | LinkedIn

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Beyond lessening the regulatory requirements and thus lowering the barriers to entry, two of the main advantages of a regulatory sandbox are the transparency of the licensing / application process, as well as the support regulators can provide to FinTechs to guide them through the process, speeding up the product development cycle and launch.

From The Regulatory Sandbox | Ariadne Plaitakis | Pulse | LinkedIn

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GPs could blacklist patients who use a forged doctor's note to pull a sickie | Daily Mail Online

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Patients who use fake medical notes to take extra time off work could be struck off by their GP.

Websites are offering bespoke notes purporting to be from a customer’s family doctor – for as little as £10.

From GPs could blacklist patients who use a forged doctor's note to pull a sickie | Daily Mail Online

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Saturday, 3 September 2016

Interscatter communication enables first-ever implanted devices, smart contact lenses, credit cards that ‘talk’ Wi-Fi | UW Today

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The team built credit card prototypes that can communicate directly with each other by reflecting Bluetooth signals coming from a smartphone. This opens up possibilities for smart credit cards that can communicate directly with other cards and enable applications where users can split the bill by just tapping their credit cards together.

[From

Interscatter communication enables first-ever implanted devices, smart contact lenses, credit cards that ‘talk’ Wi-Fi | UW Today

]

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No cash allowed: Stores refusing to accept money- Boston Globe

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Amsterdam Falafelshop owner Matt D’Alessio said he stopped taking cash in December when he realized more than 85 percent of his customers — a mix of tourists and Boston University students — paid with plastic and that he could save employee time and payroll costs by eliminating cash registers and trips to the bank.

[From

No cash allowed: Stores refusing to accept money- Boston Globe

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Cashless Payments Strengthen Consumer Choice | PYMNTS.com

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Currently, approximately 400–500 of the company’s vending machines include cashless payment readers, which has resulted in about 32 percent of Coastal Canteen’s average machine sales coming from cashless usage.

[From

Cashless Payments Strengthen Consumer Choice | PYMNTS.com

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Talking point

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Large banks’ trading income in Jan-Jun was 37% lower than in 2015, confirming the diminished role it is playing since the financial crisis (it contributes only a tenth to total revenues any more). The emerging single largest problem, however, is fees and commissions. They dropped by a full 10% yoy to the lowest H1 level since 2009. This is confounding banks, which had pinned great hope on them to make up for shrinking interest income.

[From

Talking point

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Hope for bank fraud victims: 'We were robbed of £47,000 – but the ombudsman took our side'

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Andrew Goodwill, founder of the Goodwill group, which fights fraud, said: “The ombudsman’s ruling, while it will not set a formal precedent, suggests there was a flaw in the due diligence that Lloyds should have carried out when the fraudsters’ account was opened.”

[From

Hope for bank fraud victims: 'We were robbed of £47,000 – but the ombudsman took our side'

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