US 'main source of EU card fraud'

8 January 2013 Last updated at 08:06 ET

Data breaches in the US account for most of the credit card fraud affecting the EU, a new police report says.

Criminal gangs are making about 1.5bn euros (£1.2bn; $2bn) annually from such fraud, the EU police agency Europol says, regretting that compliance with new security features remains patchy.

In 2011 nearly all fraud involving EU cards took place outside the EU. Chip-and-PIN security used in the EU is not yet global, Europol notes.

Such fraud cases overseas have risen.

Besides the US, the fraud networks are also very active in Brazil, Colombia, the Dominican Republic, Mexico and Russia, Europol says.

"So far most of the credit card numbers misused in the EU have come from data breaches in the US," Europol says, adding that most illegal face-to-face card transactions with EU-issued cards also happened in the US.

In 2011 alone nearly 727m payment cards were issued in the EU.

Fraudulent "card-not-present" transactions, where personal data is stolen on the internet, account for about 60% of the losses from credit card fraud, according to Europol.

The agency is launching a new Cybercrime Centre in The Hague this week, dedicated to fighting such crimes.

Europol notes a range of problems in tackling credit card fraud:

• Proper regulations for reporting data breaches to police are lacking
• Criminals operate in complex international networks, exploiting gaps in police and justice co-operation
• Often the crimes take place online in several countries, with numerous people involved
• Data thefts on the internet usually involve huge quantities of personal data, which criminals then sell on the internet.

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Chinese dad hires virtual hitmen

7 January 2013 Last updated at 11:28 ET

A man in China hired virtual "assassins" to hunt down his son in online video games and kill off his avatar, according to local media.

The man, named by the Kotaku East blog as Mr Feng, was concerned about the amount of time his 23-year-old unemployed son was spending online.

He hoped his actions would deter his son from playing the games, he is reported to have said.

His son eventually asked one of the gamers why they kept targeting him.

"It's not going to do much for family relations," Prof Mark Griffiths, a gambling and addictions expert at Nottingham Trent University told the BBC.

"I've never heard of that kind of intervention before, but I don't think these top-down approaches work. Most excessive game playing is usually a symptom of an underlying problem."

Prof Griffiths said he heard from many parents who were worried about their children's gaming habits but often it was not an addiction.

"I've spent 25 years studying excessive video game playing," he said.

"I've come across very excessive players - playing for 10 to 14 hours a day - but for a lot of these people it causes no detrimental problems if they are not employed, aren't in relationships and don't have children.

"It's not the time you spend doing something, it's the impact it has on your life."

Father and son are said to have reconciled but World of Warcraft expert Olivia Grace said she did not think Mr Feng's actions would necessarily act as a deterrent.

"Being killed by someone happens all the time," she said.

"People are just like that online."

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Algerian 'bank hacker' arrested

7 January 2013 Last updated at 12:33 ET

An alleged Algerian computer hacker wanted by the FBI on suspicion of stealing millions of dollars from US banks to fund a life of luxury has been arrested in Bangkok, Thai police say.

The FBI have been tracking 24-year-old Hamza Bendelladj, a computer science graduate, for three years.

He is reported to have begun hacking into banks at the age of 20.

Mr Bendelladj said he used the money to fund a life of luxury, a Thai police chief has been quoted as saying.

He was detained at a Bangkok airport on Sunday after arriving from Malaysia for a connecting flight to Cairo.

US authorities accuse him of hacking into private accounts in more than 217 banks and financial companies worldwide, causing millions of dollars in losses.

"When asked what he did with the money, he said he spent it on travelling and a luxurious life, like flying first class and staying in luxury places," immigration police chief Pharnu Kerdlarpphon told reporters.

He was arrested during a stopover at Thailand's international airport while travelling from Malaysia, where he said that he and his family had been on holiday.

Police said they had confiscated two laptops, a tablet computer, a satellite phone and a number of external hard drives from Mr Bendelladj.

He will be extradited to the US state of Georgia, where a district court has issued an arrest warrant.

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Sony unveils bath-friendly phone

7 January 2013 Last updated at 21:19 ET By Leo Kelion Technology reporter, Las Vegas

Sony has announced a new smartphone that can be used in the shower or bath without the risk of damage.

This water-resistant feature is relatively common in Japan, but has not been included in many top-end smartphones released elsewhere.

The Xperia Z can also record HDR (high dynamic range) video, a facility borrowed from its camera division.

One analyst said it was evidence of Sony Mobile making progress but added "it still had a mountain to climb".

The Japanese company announced it was taking control of the smartphone unit - which had previously been a joint venture with Ericsson - in October 2011.

Sony posted a full-year loss of 56.7bn yen ($5.7bn; £3.5bn) in May and has continued to lose money over subsequent quarters.

Water-resistant movies

The Android-powered device was unveiled at the Consumer Electronics Show in Las Vegas.

Continue reading the main story

In isolation this looks like a very strong product and it's the most attractive Xperia phone that I have seen for a very long time"

End Quote Ben Wood CCS Insight

Sony says the handset, which has a 5in (12.7cm) screen, is capable of being submerged in water of up to one metre (3.3 ft) in depth for 30 minutes.

"If you want to want to sit in the bath and watch an HD movie this is the device for you," Sony Mobile executive Steve Walker told the BBC.

"You can take it in the shower if you want, or more usefully if you get it dirty you can wash it under the tap."

He added that about one in 10 people had dropped their phone down a toilet at some point, something this would protect against.

The trade-off is that handset's various ports, including the one for its headphones, all feature protective plastic covers that must be unclipped before they can be accessed.

HDR video

Other features on the 7.9mm-thick (0.3in) device include 4G LTE connectivity, a Micro SD slot, a 13 megapixel camera and a 1080p x 1920p high-definition screen that borrows technology from the firm's Bravia TV division to enhance video playback.

In addition a NFC (near field communication) chip is used to start streaming content to Sony's latest televisions by tapping the handset against their remote controls.

The firm also boasts that the device includes its proprietary Exmor RS image sensor technology, allowing it to record HDR video.

This allows it to combine exposure readings to tackle problematic situations such when a person is standing against a bright background; Sony says that without HDR either the person's face looks too dark or the background too light.

Nvidia's latest Tegra chip can also do this but has not been built into a handset yet.

Recovery boost?

Ben Wood, an analyst at CCS Insight, noted that Sony's mobile unit is enjoying a recovery, and recently passed HTC to become the third best-selling smartphone brand in the UK.

He added that efforts to share designs and technologies across the firm's different divisions would likely be the key to its revival. However, he added that it was too soon to say whether the new handset would be a winner.

"In isolation this looks like a very strong product and it's the most attractive Xperia phone that I have seen for a very long time," he said.

"But we don't know what this device is going to be competing with this year."

"Until we see the next Samsung flagship device and other top-end phones at Mobile World Congress in February it's hard to know how it will do."

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Samsung simplifies its smart TVs

7 January 2013 Last updated at 22:58 ET By Leo Kelion Technology reporter, Las Vegas

Samsung Electronics has taken steps to simplify the interface of its internet connected televisions in an attempt to make them more user-friendly.

The South Korean firm is the world's best-selling maker of smart TVs, which allow people to surf the web and access other services via their main screen.

But along with other smart TV makers, it has faced criticism that many people rarely use the added functionality.

That has limited its ability to make money from the add-on services.

The company also announced at the Consumer Electronics Show (CES) in Las Vegas that it would put a super-sized 110in (279cm) 4k ultra-high resolution LCD TV on display when the trade show started on Tuesday.

Ultra-high definition offers four times as many pixels as today's 1080p HD standard, allowing screens to expand in size without sacrificing picture quality.

Simultaneous viewing

Continue reading the main story

"Start Quote

It sounds like they are doing what they have to do and are progressing as expected, but on the other hand there was nothing much surprising or exciting about the announcement today"

End Quote Ichiro Ishiguro Hermes

Executives also said they would show off a 55in OLED (organic light-emitting diode) display that could show two different shows full-screen at the same time.

Users must wear special glasses with built-in headphones to view one programme and block the other.

The innovation takes advantage of technology previously used to create a sense of 3D.

However, it is not the first to show off the concept.

Sony demonstrated similar technology in 2011, and despite Samsung's efforts some company watchers had hoped for more from the event.

"There were good announcements about smart TVs, 4k TVs and other connected devices," said Ichiro Ishiguro, an analyst at Hermes who has been coming to CES for 10 years.

"It sounds like they are doing what they have to do and are progressing as expected, but on the other hand there was nothing much surprising or exciting about the announcement today."

Recommended shows

Samsung said its smart TV interface had been redesigned to be "more visually appealing".

Users now swipe through five panels which take them between shows being broadcast at that time; on-demand programmes and movies; photos and other content sourced from connectable devices; social networks and Skype; and finally smart TV apps.

The system also uses a facility called S Recommendation to suggest content based on the owner's past viewing habits which can take account of the way their choices change at different times of the day.

A new T-commerce service will also allow users to identify the clothes stars are wearing and order their own copy of the outfit on selected programmes.

To offer the new functionality Samsung has upgraded the equipment's computer processor.

Owners of the previous generation TVs will be offered an upgrade hardware pack which they can slot into the back of their set, making good on a promise made last year.

'Marriage saver'

Continue reading the main story

"Start Quote

I guess it's a nice thing to show at CES but for 'real people' it doesn't mean much now"

End Quote Brandon Hill Dailytech

Brandon Hill, editor of the Dailytech blog, said that while much of the technology was impressive it would probably remain too expensive for "normal people" for years to come.

However, he thought the ability for two people to watch different shows at once might prove popular once it eventually became available to displays targeted at the mass market.

"It might save a few marriages even though it seems a bit gimmicky," he said.

"It will definitely filter down to the consumer market but it will just be a few years before we see it there. I guess it's a nice thing to show at CES but for 'real people' it doesn't mean much now."

Samsung's event also introduced new smart devices for the kitchen.

They included a fridge-freezer featuring a compartment that can be switched between the the two states, and an oven that can cook two meals at different temperatures.

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Man admits to $100m piracy scam

8 January 2013 Last updated at 05:41 ET

A Chinese man has pleaded guilty to selling pirated US business software worth more than $100m (£62m).

The software, stolen from 200 manufacturers, was sold in 2008-2011 for a fraction of their High Street prices, US prosecutors said.

Xiang Li was arrested in June 2011 in Saipan during an undercover sting operation.

He has pleaded guilty to conspiracy to commit criminal copyright violations and wire fraud.

"I want to tell the court that what I did was wrong and illegal and I want to say I'm sorry," Mr Li told district judge Leonard Stark, although he disputed the retail value of the software he stole and sold.

Mr Li, from China's Chengdu province, targeted software from big manufacturers including Microsoft, Oracle, SAP and Rockwell Automation before selling them on to 325 buyers, including a Nasa engineer as well as military contractors.

The black market buyers extended from 28 US states to more than 60 countries.

Cheap sales

The businessman searched for hacked software on internet forums before advertising them for sale on his websites which offered more than 2,000 pirated titles, prosecutors said.

The pirated programmes were then allegedly transferred to customers via Gmail, and Mr Li and a second suspect collected payment through money transfer services.

The pirated software was said to be sold for as little as $20 to up to $1,200 - with the retail value of the products were much higher, ranging from several hundred dollars to more than one million dollars apiece, according to US officials.

The scam came to light after a US manufacturer discovered his company's software was being sold on Mr Li's website crack99.com, and notified authorities.

Mr Li was eventually arrested by US agents after an 18-month undercover operation.

His lawyer, Mingli Chen, said: "He was pretty proud of himself. He did not realise it was such a big crime."

Last year US prosecutors charged seven people, including Megaupload founder Kim Dotcom, with racketeering and copyright violations for running a site that sold an estimated $500m worth of pirated entertainment software including movies and TV programmes.

Mr Dotcom is contesting the charges against him and other Megaupload executives alleging that much of the operation against him was unlawful.

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Laser used to shoot down drones

8 January 2013 Last updated at 06:25 ET

A laser weapons system that can shoot down two drones at a distance of over a mile has been demonstrated by Rheinmetall Defence.

The German defence firm used the high-energy laser equipment to shoot fast-moving drones at a distance.

The system, which uses two laser weapons, was also used to cut through a steel girder a kilometre away.

The company plans to make the laser weapons system mobile and to integrate automatic cannon.

The 50kW laser weapons system used radar and optical systems to detect and track two incoming drones, the company said. The nose-diving drones were flying at 50 metres per second, and were shot down when they reached a programmed fire sector.

Weather trials

The weapons system locked onto the unmanned aerial vehicles (UAVs) by using radar for a rough approximation of the location of the targets, then fine-tuned the tracking using an optical system.

The high-energy laser system was used to cut through a 15mm-thick steel girder, and to shoot out of the air a steel ball designed to mimic a mortar round.

The company has tested the laser system in a variety of weather conditions, including snow, sunlight, and rain.

Rheinmetall plans to test its laser weapons mounted on different vehicles and to integrate a 35mm revolver cannon into it.

A number of governments and defence firms are in the process of developing weapons that use or incorporate lasers. For example, Raytheon unveiled a 50kW anti-aircraft laser at the Farnborough Airshow in 2010, and in June 2012 the US Army released details of a weapon that can fire a laser-guided lightning-bolt at a target.

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Online boost for Christmas sales

8 January 2013 Last updated at 07:25 ET

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Online shopping bolsters Christmas sales

Strong growth in online shopping stopped retail sales falling in December, according to the British Retail Consortium (BRC).

Sales in December were up 1.5% compared with a year earlier, while like-for-like sales, which exclude new store openings, rose 0.3%.

Without a 17.8% jump in online non-food sales, total sales would have fallen.

"Since the beginning of 2011 we're really not going anywhere," said new BRC director general Helen Dickinson.

She added that there was little sign that things would improve in 2013.

The BRC bases its retail sales monitor on responses from its members.

"Many retailers have invested a lot in making their websites easier to use across devices and also increasing confidence in their online security... the surging popularity of tablets and smartphones giving even better access is a major factor," Helen Dickinson said.

"For the more established retailers, it seems that much of the growth is now coming from online orders, while shop sales are stagnant at best."

However, online retail was still only a small proportion of total sales, accounting for a little over 10%.

Continue reading the main story

Analysis - the enduring appeal of department stores

As you might expect, department stores were the clear winners on the High Street over Christmas.

With almost everything from soap for your auntie to toys for your nephew under one roof, they make buying presents both quick and easy.

But most department stores have actually been doing pretty well for a while now, and good online offerings seem to have been the key.

John Lewis has led the way, with what retail analyst Rahul Sharma calls "the best brand and the best online offer".

Meanwhile Debenhams' strategy of frequent sales and promotions has been successful at keeping money coming in at a time when the wider High Street has struggled.

House of Fraser has also fared well, catering as it does for the higher-end shopper whose disposable income has not been hit as hard as some during the downturn.

And at the top end, Selfridges, Harvey Nichols and Harrods have all benefited from big spending visitors to the UK, particularly from China and the Middle East.

There's a reason department stores have been around for almost 300 years - many have proved remarkably adept at moving with the times.

Mixed performance

Aside from online, the one bright spot was department stores. On Tuesday, Debenhams reported record sales in December, while on Monday House of Fraser posted its "highest ever" festive sales. Last week, John Lewis also reported a sharp rise in Christmas sales.

"Department stores will always do well at Christmas, because they sell a lot of products under one roof," Neil Saunders at retail analysts Conlumino told the BBC.

They have all also benefited from strong online offerings, particularly John Lewis with its click and collect service.

He also pointed to the fact that some established High Street names, such as Comet, are no longer trading, boosting sales at rival retailers. John Lewis, for example, "did extremely well in electricals", he said.

"But this is not a sign that the market is growing, just a reallocation of sales."

Mr Saunders also said upcoming trading statements from some big retailers would be less positive than those from the department stores.

"We have yet to have Marks and Spencer, which is not going to be great," he said. He also highlighted supermarket chain Morrisons, which on Monday reported a fall in sales in December.

Official figures for retail sales in December will be released on 18 January.

'Running fast'

Continue reading the main story

"Start Quote

All the retailers here are working together instead of trying to compete with each other"

End Quote Darren Thorne, Seeds2Bakery in Totnes, on why its High Street is thriving

The BRC also said the narrow gap between total sales and like-for-like sales was a sign of the small number of new store openings in 2012.

It said that the sales growth, which was flat after allowing for inflation, was making life difficult for retailers because rising costs meant they were "running fast to stand still".

The flat reading on inflation-adjusted sales was the worst December performance since 2008.

It rounded off a tough year for UK retailers, when a number of big High Street names went into administration, including Peacocks, Game, Aquascutum, Clinton Cards and Comet.

Analysts said more were likely to follow.

"January will be a tough month for retailers as consumers face up to their credit card bills after Christmas, and it's likely 2013 will bring more of the same challenges," said David McCorquodale, head of retail at KPMG.

"There will be no boom and it is likely more than a few will go bust."

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French ISP ends online ad blocking

8 January 2013 Last updated at 07:59 ET

A major French internet service provider (ISP) has agreed to abandon its ad-blocking policy - seen as a swipe against Google - after a minister intervened.

Digital Economy minister Fleur Pellerin said she persuaded Free to restore full access to all content on the internet, including Google ads.

Free started blocking ads last week when it updated home router software.

It was seen as forcing Google to pay its fair share to service providers.

The French minister said: "No actor can jeopardise the digital ecosystem in a unilateral way."

Free has argued in the past that Google does not pay its way when ISPs are forced to increase investment in running services like YouTube, which take up a lot of bandwidth.

Google's AdServe online advertising software - which allows online businesses to target their audiences in exchange for a share of the advertising profits - is used on many websites.

'Cuckoo bird'

Philippe Jannet, the former president of Geste, the French online publishers association, said that when operators "see Google come in like a cuckoo bird and make profit off the internet service they provide without receiving a penny in return, it's normal that they get mad".

The move by Free - France's second biggest ISP with more than five million subscribers - would have cost Google up to one million euros every day, a source told news agency AFP.

"That's what would push the giant to speak to the little operator," he added.

Ms Pellerin said she did not have an estimate yet of the financial impact from the fallout. She has scheduled a meeting with Google about Free's actions.

A Free spokeswoman declined to comment on the matter.

Google spokesman Al Verney said: "We are aware of Free's actions and are investigating their impact."

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Valve shows off console hardware

8 January 2013 Last updated at 08:57 ET

Video game maker Valve has unveiled a modular PC designed to let users to play Steam games on their TV.

Codenamed "Piston", the product, developed by Xi3 Corporation and funded by Valve, was unveiled at the CES trade show in Las Vegas.

The set-top box will allow users to access thousands of gaming titles through an integrated system, a statement said.

Plans for the living room-friendly console emerged early last month.

"Today marks the beginning of a new era for Xi3," said Jason Sullivan, founder and chief executive of Xi3, in a statement.

"This new development stage product will allow users to take full-advantage of their large high-definition TV displays for an amazing computer game experience," he added.

"As a result, this new system could provide access to thousands of gaming titles through an integrated system that exceeds the capabilities of leading game consoles, but can fit in the palm of your hand."

Despite the grapefruit-sized device being on show on both Valve and Xi3's stands at CES no details of the internal hardware have been given. Other Xi3 computers are based around dual core Intel chips and use solid state storage.

Valve, best known for the Half-Life, Left4Dead and Team Fortress games has long been known to be working on a console that puts its PC-based titles onto a TV.

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