Top cybercrime ring disrupted as authorities raid Moscow offices

Moscow Sergey Norin Flickr

WASHINGTON (Joseph Menn, Reuters) – Russian authorities in November raided offices associated with a Moscow film distribution and production company as part of a crackdown on one of the world’s most notorious financial hacking operations, according to three sources with knowledge of the matter.

Cybersecurity experts said a password-stealing software program known as Dyre — believed to be responsible for at least tens of millions of dollars in losses at financial institutions including Bank of America Corp and JPMorgan Chase & Co — has not been deployed since the time of the raid. Experts familiar with the situation said the case represents Russia’s biggest effort to date to crack down on cyber-crime.

A spokesman for the Russian Interior Ministry’s cybercrime unit said his department was not involved in the case. The FSB, Russia’s main intelligence service, said it had no immediate comment.

Nikolay Volchkov, the chief executive of the film company named 25th Floor, said he could not answer questions about the raid.

Without an official confirmation, much remains a mystery. Reuters could not determine a direct link between the program’s shutdown and the raid.

The sources said that a number of people were questioned by the authorities but Reuters was unable to ascertain further details, including whether there were arrests or criminal charges. Reuters has no evidence that Volchkov or the film company is implicated in any wrongdoing and couldn’t determine precisely who is.

Hackers targeting Western financial institutions and individuals are rarely punished in Russia. Consequently, the November raid is seen as potentially a landmark event by Western cyber-crime watchers.

The Dyre hackers used a range of tricks to insert sophisticated computer code into consumer Web browsers to manipulate communications between those customers and more than 400 financial institutions, according to analysts at Dell SecureWorks. IBM said it was the most pervasive financial theft software hitting its customers last year.

But then Dyre stopped spreading, banking and security experts said. “We have seen a disruption over the last few months that is definitely consistent with successful law enforcement action,” said cybercrime expert John Miller of U.S.-based security firm iSight Partners, who had no knowledge of specific arrests.

The Dyre investigation in Russia is being aided by Kaspersky Lab, a top cyber-security firm. A person close to the company said it would reveal details about the case at its annual conference for security experts starting Sunday. Kaspersky declined to comment on its conference plans.

CYBER-CRIME THRILLER

Adding further intrigue to the November raid is that 25th Floor is in the midst of producing a film called Botnet, a cyber-crime thriller loosely based on a 2010 case in which 37 people in the United States and elsewhere were charged in a $3 million scam.

Prosecutors in the 2010 case touted the bust as a big win against organized cybercrime. Tabloid media outlets loved the story, especially as photos circulated of one of the suspects, a blue-eyed Russian brunette named Kristina Svechinskaya, who was referred to by The Sun newspaper in Britain as “the world’s sexiest hacker.”

However, most of the people charged were lower-level in the scam and the key figures were never named, let alone arrested.

The hackers used a variant of the then-top program for hijacking bank accounts, known as Zeus, which law enforcement sources say is related to the present-day Dyre.

Housed in a fashionable Moscow skyscraper, 25th Floor distributes movies and television shows in Russia and neighboring countries as well as producing some of its own. Last year’s distribution slate included “The Runner,” with Nicholas Cage, and this April it is slated to ship “Exposed,” a police corruption drama with Keanu Reeves.

Two people briefed on the November raid said it involved both 25th Floor’s office and a related neighboring office.

In treatments for the movie version of the crime story seen by Reuters, the lead female character grows up poor in a Moscow housing complex, is lured into an imagined high life of New York hackers, and eventually gets arrested by the U.S. National Security Agency before turning on the worst of her criminal associates and walking free.

“HE WAS AFRAID”

Ilya Sachkov, chief executive of Group-IB, a Moscow-based computer security company, said his firm was hired by 25th Floor to advise the Botnet director and writers on the finer points of cybercrime.

Sachkov said he was initially approached at a security conference by Volchkov. “He asked if we would be interested in consulting with a scriptwriter they would hire in the United States,” Sachkov said.

Sachkov said he met with Volchkov about half-a-dozen times to discuss aspects of the plot.

Then, last November, Sachkov got an urgent call from Volchkov, saying he needed to meet.

“He was afraid. His color was totally white,” said Sachkov. “He knows there is an ongoing investigation about cybercrime.”

Volchkov declined to comment on the events.










Dealflow Newswire for Global $10-trillion Private Investment and Non-Bank Finance Market.

DealWire, developed by TheWealthJournal.net , is now delivering corporate and project financing opportunities, posted by seasoned intermediaries, direct to Hedge PE and VC funds. More recently, private investment channels have also come to include the growing number of direct/private investment funds, family offices, wealth managers and private banks.

How Apple Can Improve Its Watch And Boost Sales

apple-money Apple isn’t releasing exact sales numbers, but some expert digging has led many to believe that sales of the Apple Watch haven’t reached expectations since its launch in spring 2015. The company’s annual filing suggested it sold $1.7 billion worth in fiscal 2015, but compare that with the iPhone, which sold $32.2 billion worth in the fourth quarter alone. That’s a… Read More

Machine Zone spends $5M on Mobile Strike Super Bowl 50 commercial with Schwarzenegger

Arnold Schwarzenegger stars in the new ad for Mobile Strike from Machine Zone.

Developer Machine Zone has spent heavily to advertise its products during the Super Bowl for the second year in a row.

The studio brought back actor Arnold Schwarzenegger to help it promote Mobile Strike, its military strategy game for iOS and Android. The 30-second spot featured the actor battling it out in the game while sharing an elevator with other Mobile Strike players. The mobile gaming industry is a $30 billion business annually, and that is one of the reasons that Machine Zone is willing to spend the $5 million it costs to purchase 30-seconds of marketing time during the National Football League’s biggest game.

Check out the Super Bowl spot below:

This comes after Machine Zone spent $4.5 million last year to advertise its Game of War fantasy strategy game for iOS and Android during last year’s Super Bowl. For that ad, the company turned to celebrity bathing-suit model Kate Upton.

Obviously, if Machine Zone is returning to the Super Bowl, it must’ve seen some sort of positive return on investment on its Game of War ad, which you can watch below:

 

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Why You Should Be Concerned About The Cybersecurity Information Sharing Act

worried I really do wish I understood why lawmakers seem so gung-ho on tearing apart technologies they don’t understand, and freedoms they hardly think about. Frankly, it’s starting to get exhausting — and more than a little difficult to keep straight all the legal bungles belched out by senators and their lobbyists. Until now, we’ve been lucky; most of the ill-conceived… Read More

Titanfall 2 will feature a single-player campaign and possible TV spin-off show

Titanfall

Titanfall 2 will have a single-player campaign and a companion TV show, Respawn Entertainment’s lead writer Jesse Stern told Forbes in an interview.

This revelation shows that Respawn — started by Call of Duty veterans Jason West and Vince Zampella — is being a lot more ambitious with its first-person shooter that was a big hit when it debuted in March 2014. The first title in the series had a limited scope by necessity, as Respawn was still a small startup at the time.

Titanfall 2 will have a world that is “grounded, human, and real,” Stern said in the interview. Respawn spent about six months adding new content to Titanfall after it debuted. Then, work began on Titanfall 2 in late 2014, Stern said.

Titanfall had an estimated 10 million individual players, and that gave Respawn the cash to do the next game right. Electronic Arts is the publisher, but it has not yet set a release date for the game, beyond saying it will come in fiscal 2017, or by the end of March 2017.

“We’re only a little past a year into it,” Stern said to Forbes. “It takes two years to make these things usually. Sometime late this year or early next seems like the right neighborhood.”

The first Titanfall was an exclusive on the Xbox One, but this title is expected to hit multiple platforms. And the single-player campaign will have a story that basically retells the stories of the American Revolution and the Civil War in space.

“What inspires us is the junction of technological advancement with the inevitability of conflict and war and what the next war might look like,” Stern said. “In Titanfall 2, there will be a lot of [scenes] where science meets magic but keeping it grounded and dirty and human and real.”

Stern is working on a TV series spin-off of Titanfall with Respawn in partnership with Lionsgate TV. But the details were scarce on that project, except that it would be very expensive.

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Super Bowl Technology Mishaps And Real Time Rescues

SAN FRANCISCO, CA - FEBRUARY 04:  A  large graphic of the Vince Lombardi Trophy promoting Super Bowl 50 is displayed on a skyscraper on February 4, 2016 in San Francisco, California.  (Photo by Mike Windle/Getty Images) The Super Bowl is the crowning glory of sports in the United States, but it hasn’t been without it’s mishaps. They aren’t the last minute fumbles, missed field goals, or obvious interceptions either. They’re those unfortunate outside incidents that stopped or changed the course of the game. In many cases, today’s real time technologies could have been applied… Read More

Google reportedly plans to release a Cardboard successor similar to Samsung’s Gear VR this year

Samsung Gear VR

Google is planning to release a new virtual reality headset for smartphones this year, pegged as a successor to its Google Cardboard platform and similar to Samsung’s Gear VR. The company will add extra support for the technology to its Android operating system, according to a people familiar with its plans cited by The Financial Times.

Last month, Google announced that 5 million Cardboard VR headsets have shipped so far (not all were shipped by Google, as Cardboard uses an open-source design that allows any manufacturer to sell “Works with Google Cardboard” devices). In November, Samsung released the Gear VR in collaboration with Facebook’s Oculus VR.

The report suggests Google’s new VR product will feature “better sensors, lenses and a more solid plastic casing.” Like Cardboard and Gear VR, the new headset will rely on a smartphone for its display and “most of its processing power.”

The “most” part is key here: Google Cardboard relies solely on your smartphone while Gear VR features extra motion sensors. Google’s upcoming headset is said to be compatible with a “much broader range of Android devices than Gear VR,” which only works with Samsung’s Galaxy S6, Galaxy S6 edge, Galaxy S6 edge+, and Galaxy Note 5.

On the software side, Google is reportedly hoping to embed new virtual reality features directly into Android. This is unlike Google Cardboard, which relies on a traditional app for all its virtual reality bells and whistles.

Better hardware and software will result in viewers willing to spend longer in virtual reality and developers creating more sophisticated apps, Google hopes. Indeed, the company’s new solution will likely be meant to build out Android as a virtual reality platform — Google will want to help other manufacturers develop their own compatible solutions rather than show off a limited closed platform.

When exactly might we see this latest virtual reality push? Given that Google typically shows off new Android versions at its I/O developer conference, and that Cardboard debuted at I/O 2014, it’s a safe bet to expect the unveiling at I/O 2016. This year’s edition is slated for May 18 to May 20 in Mountain View.










Apple’s gaming censorship continues: The Binding of Isaac blocked from App Store

The Binding of Isaac: Rebirth is a spin on the Biblical story of Isaac.

Apple has repeatedly shown its contempt for gaming, and the company still hasn’t changed.

Developer Tyrone Rodriguez, founder of studio Nicalis, revealed that Apple has rejected The Binding of Isaac: Rebirth from the App Store (first reported by EuroGamer). The game has players taking on the role of a boy named Isaac whose mother has trapped him in her basement. As Isaac, players must traverse the monsters and other dangers of the dungeon in an effort to escape. This is a satire of the Biblical Binding of Isaac story where God commands Abraham to sacrifice his son Isaac. Apple’s reason for rejecting the game version of this story is that it portrays violence against children. This is another example of the company’s double standard when it comes to video games, as you can find plenty of depictions of violence against children on iTunes. You can even purchase products from convicted abusers on iTunes.

Apple’s treatment of games is a problem because it controls an enormous market. The App Store makes up for at least half of the $30 billion mobile gaming business. And since iOS is a closed system, consumers cannot easily choose to bypass the App Store to download banned games if they want. This means gamers and consumers in the iOS ecosystem are at the whims of Apple when it comes to the software they can choose to play on their devices.

For Apple, this is typical. It thinks of games as less than films, books, and music.

The iPhone company has repeatedly censored games for their content. We’ve reached out to the company to see if wishes to comment on this story and further explain its reasoning. We’ll update this post with any new information.

In 2013, the tech giant blocked Endgame: Syria, a game about the real Syrian civil war, from the App Store. That same year, it removed Sweatshop from its software market for exploring the conditions of working in a third-world manufacturing plant.

In 2014, Apple rejected the sexual-education game HappyPlayTime, which encourages women to explore their sexuality.

And Apple has no problem proclaiming that games don’t deserve the same consideration as other mediums.

“We view apps different than books or songs, which we do not curate,” reads Apple’s guidelines for app developers. “If you want to criticize a religion, write a book. If you want to describe sex, write a book or a song or create a medical app. It can get complicated, but we have decided to not allow certain kinds of content in the App Store.”

Apple has the legal right to do this, of course. This is not illegal government censorship. But regardless, it could have a chilling effect on the kinds of expression game developers wish to partake in. Why risk losing out on potential revenue because Apple thinks games should explore certain topics?

Developer East Side Games actually completely avoided developing an iOS version of its Pot Farm: Grass Roots game about running a marijuana-growing facility. Instead, it made a game about junk food for Apple’s device while you can get the real Pot Farm on Android.

In an already risky gaming market where mobile is so crucial, Apple’s dismissive attitude toward gaming is the kind of external pressure that could keep developers afraid to take chances. And that’s a power Apple should reconsider wielding.

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Super Bowl Showdown: Is esports or the NFL a better career choice?

Super-Bowl-50-Logo

Today is Super Bowl 50, and about 120 million people are expected to watch the Denver Broncos square off against the Carolina Panthers. That’s one-third of all Americans, many of whom have never played pigskin, watching one professional football game. And yet there’s another sport that in just a few years has become played by nearly every child in America: video games.

This sport’s version of the Super Bowl, the World Championships for League of Legends held last year, drew 36 million viewers worldwide. It’s an audience number that’s sure to increase dramatically in the years ahead. While this growth is encouraging for esports as an industry — it hit $748 million last year — it also reveals some of the problems pro gamers share with their NFL brethren.

Esports is the name given competitive pro gaming, where players earn salaries from professional teams and compete in tournaments against others from across the globe. The events are streamed live on Twitch and now YouTube gaming, and will soon become a billion-dollar industry

Screen Shot 2016-02-06 at 5.29.56 PM

Above: The long odds of making to the NFL

The odds

For starters, prospective players face the long odds of going from amateur to professional. “If you look at it from purely a ‘how to become a pro’ in the respective sports, then the NFL is clearly much, much harder,” says Dennis Fong, a pioneering pro gamer of Quake and Doom fame. “In esports, you can go from playing in your PJs at home one day to being a pro the next day. In the NFL, you have go through an entire system from Pop Warner [that’s Little League for football] to high school to college to the NFL and have the right things at the right time fall into place to even be discovered.”

According to a 2013 NCAA report, about 1 million kids are playing high school football each year, with about 20,000 of them making a college team. The NFL drafts just 250 of them. Put another away, as a high school senior in New Orleans, Denver Broncos quarterback Peyton Manning who will play in Super Bowl 50 today had just a 0.08 percent chance of making it to the pros. Long odds, right? Not so different compared to the odds faced by those seeking to become a pro gamer.

The 2014 U.S. Census reported an estimated 73.6 million children under the age of 18, and nearly every research firm pegs video game use in the 90 percent or greater range for this age group. After my own back-of-the envelope calculation for age distribution, the U.S. has approximately 18 million high school gamers, compared to the 1 million high school football players estimated by the NCAA.

Unlike the NFL with its finite number of open draft slots each year, estimates for the number of active professionals are difficult to find. Pro gamers in the U.S. can include those drawing esports team salaries, competing in professional tournaments, earning money as game livestreamers (itself a lucrative industry at $3.8 billion in 2015), or perhaps being paid as a marketer or via sponsorship. And prospective pros have many games and platforms to choose from. Still, it’s a player base of millions of amateurs compared to professional positions that number in the thousands, or perhaps tens of thousands at most. “For example, League of Legends has approximately 70 million monthly active players but less than a thousand pro players,” says Fong.

The risk of injury

But long odds of attaining professional status are not all that pro gamers share with the NFL. While spared the dangers of concussions or other physical trauma, the possibility of injury is real. “The most common career-ending injury for pro gamers is repetitive stress,” Fong says and explains that he still suffers from it. “Sitting at a computer all day is generally not the best thing for one’s posture and unfortunately, it’s not generally something you think a lot about at a young age until the pain creeps in; and at that point, it’s too late.”

Both professions favor youth, and longevity is often short-lived. The typical NFL careers is just 3.3 years. Fong’s professional career began when he was 16 years old and lasted only five years. “Considering the physical demands made by practicing 10 hours a day, most competitive gamers skew young, between 18 and 25 years old,” says Joost van Dreunen, the CEO of media and games consultancy SuperData Research. A pro gamer’s career is “surprisingly short, as most players cycle out in their mid-20s.”

Show us the money

While the average salary for an NFL player was $1.9 million as of 2013, pro gamers earn considerably less. Top pro gamer Marcus “Dyrus” Hill retired last year at age 23 after winning $148,642 over a five-year career, according to E-sports Earnings. One Hearthstone streamer, ‘Amaz,’ who is also a pro player, gathered enough sponsorship money for his team to organize a $240,000 prize pool for a fun team series this summer, something unprecedented in pro Hearthstone.

“Most players are on a salary and receive a percentage of winnings, and few earn impressive salaries. Of course for an 18-year old to make $100,000 annually is a huge amount of money, but the real money for professional gamers seems to be in first becoming a celebrity player and then setting up a livestreaming business where they can directly monetize their viewers,” says van Dreunen.

Fong, who in the 1990s was at the top of his profession, earned about $100,000 annually from sponsorships, endorsements and winnings before becoming a successful serial entrepreneur. Fong today is CEO of Raptr, which offers the Plays.tv video-sharing platform for gamers.

Dennis Fong was the first to make himself a star in the 1990s world of competitive gaming scene.

Above: Dennis Fong was the first to make himself a star in the 1990s world of competitive gaming scene.

Image Credit: Uriel Espinoza

 

Gender equality

Unlike football, the world of professional video games should offer a level playing field for women. First, physical size means little. Manning stands 6-feet-5 and weighs 230 pounds, but that’s meaningless for success at pro gaming. Second, nearly equal numbers of young boys and girls form the amateur pool from which professionals are drawn. And within the adult population, twice as many women play games as men, according to the Entertainment Software Association, the trade group for the video game industry.

“Clearly, having faster twitch reflexes and reaction times helps, but the beauty of esports is that it isn’t defined by your genes. Esports is gender-agnostic; there are no geographic limitations and no physical attributes that are truly required to be successful,” says Fong.

Currently, just 5 percent to 10 percent of pro gamers are women, estimates van Dreunen. “That will change,“ he predicts, “as video games have become a mainstream form of entertainment, forcing game companies to appeal to a wider, more diverse audience.”

Esports also holds the promise of equal pay between the sexes. For instance, top pro gamer Katherine “Mystik” Gunn had $122,000 in winnings over three years according to E-sports Earnings. More women players winning more prize money is inevitable. “In time, we will see the percentage and presentation of female pro gamers improve, but it’s still early days,” says van Dreunen.

How big is big?

Even as revenues of professional games market reached $748 million last year and are predicted to reach $1.9 billion by 2018, the NFL with its multi-billions of dollars and it’s Super Bowl Sunday are the biggest game in America. By comparison, van Dreunen says that “esports is still in its ‘leather helmets’ stage.’”

But unlike the NFL which appeals largely to American audiences, pro gaming is a phenomenon with international teams playing for global audience. According to van Dreunen, “It makes more sense to compare esports to the FIFA World Cup to get a sense of scale, as soccer has worldwide appeal. And their world championship final drew one billion viewers.”