How diplomatic immunity protects accused criminals – by Omar Waraich September 29, 2015 5:00AM ET

In 1967, Burma’s Ambassador in Sri Lanka, Sao Boonwaa, confonted his wife Shirley, who he believed was having an affair. Their neighbors in the Cinnamon Gardens suburb of Colombo heard gunshots early in the morning.

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Later that day, a potent smell wafted from the Boonwaat home. Neighbors saw three Buddhist monks conducting final rites over a funeral pyre. The envoy was arrested, and at first even denied bail, but he invoked diplomatic immunity, and a senior official was dispatched by the Burmese regime to argue for their ambassador’s release. Sao Boonwaat returned to Burma a couple of months later, never to face trial for the killing of his wife, according to Singapore’s Straits Times.

Since then, few crimes committed have been as egregious, but foreign diplomats still continue to evade arrest and prosecution for alleged crimes as they furtively board flights back to their countries against the backdrop of local outrage and strained diplomatic relations.

Last week Majed Hassan Ashoor, the first secretary at the Saudi Embassy in Delhi, left India hounded by allegations that he held captive, beat, and repeatedly raped two Nepali women he was keeping in his home as domestic workers. Police stormed the residence, which was not located in the embassy, to recover the two women. Doctors treating the victims said they suffered extensive injuries.

The incident sparked outrage on India’s television news channels as crowds gathered on the streets to call for justice. Civil society activists and political parties in Nepal echoed the protestors’ concerns. They urged India to stand by their citizens and act against the Saudi diplomat. But on Sept. 17, the Indian government confirmed that Ashoor was protected by diplomatic immunity. Under the Vienna Convention, there was little that could be done.


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Iceland put bankers in jail rather than bailing them out — and it worked – Updated by Matthew Yglesias on June 9, 2015, 11:30 a.m. ET

Yesterday, Iceland’s prime minister, Sigmundur Gunnlaugsson, announced a plan that will essentially close the books on his country’s approach to handling the financial crisis — an approach that deviated greatly from the preferences of global financial elites and succeeded quite well. Instead of embracing the orthodoxy of bank bailouts, austerity, and low inflation, Iceland did just the opposite. And even though its economy was hammered by the banking crisis perhaps harder than any other in the world, its labor didn’t deteriorate all that much, and it had a great recovery.

How great? Well, compare the evolution of Iceland’s unemployment rate with what happened in Ireland, the star pupil of the Very Serious People:

Or compare it with the United States:

How did Iceland pull it off?

Let the banks go bust

For starters, rather than scrambling to mobilize public resources to make sure banks didn’t default on their various obligations, Iceland let the banks go bust. Executives of the country’s most important bank were prosecuted as criminals.

Reject austerity

 Trading Economics

Iceland was nonetheless hit by a very serious recession that caused its debt-to-GDP ratio to soar. But even after several years of steady increases, the government didn’t panic. It prioritized recovery. And when recovery was underway and the ratio began to fall, the government let it fall gently.

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Defense Secretary Ash Carter arrives for a news conference at the Pentagon, Thursday, April 16, 2015. ANDREW HARNIK/AP

Nearly two years after former NSA contractor Edward Snowden revealed that the agency had penetrated the internal systems of Facebook, Google and other companies, tech executives still harbor hard feelings. That’s led to a strained relationship with the Pentagon. “The Snowden issue clouds things,” United States Secretary of Defense Ashton Carter acknowledged during a visit to WIRED’s New York offices Monday.

Nevertheless, with cyberterrorism on the rise, the Pentagon has never needed tech’s know-how more.

To be fair, Snowden’s explosive revelations are not the only reason Silicon Valley and the Pentagon don’t always get along. For one thing, the institutions that reside within each world operate very differently. The military moves slowly, while startups move quickly. Military personnel adhere to an immutable job hierarchy, respecting traditional career paths, while techies often skip college, change jobs frequently, and start their own companies.

Carter has made it his mission to build a stronger working relationship between the Defense Department and techies. His visit to Silicon Valley last week, in which he delivered a speech at Stanford and stopped in at Facebook and Andreessen Horowitz, marked the first time in nearly 20 years that a defense secretary has toured Silicon Valley.

Carter has suggested reforming the military’s personnel system so he can take better advantage of private sector talent. And he wants to make it easier for the Pentagon to approve outside contractors, a process that currently takes up to two years. “For many companies, that’s an eternity when you are living on a shoestring budget,” he told WIRED. As a result, the defense department too often works with legacy vendors skilled in winning its contracts. “If what we reward in terms of federal moneys are people who have the knack for working with us rather than people who do the best job, that’s a disaster.”

A New Strategy

Carter’s tech forward perspective comes from personal experience. The physicist-turned-Pentagon chief had just moved to the West Coast, where he was a distinguished visiting fellow at Stanford’s Hoover Institution and a lecturer at the university, when President Obama called him back to Washington DC in February to serve as defense secretary. Before that, he spent part of 2014 advising large investment firms on technology and defense investments as a senior partner with the consulting firm Global Technology Partners.

While Carter was speaking at Stanford, the DOD revealed details of a new cyber strategy—the first update since 2011—that calls for 133 teams of military, civilian, and defense contractors to be in place by 2018. To help its recruiting efforts, Carter is creating a Silicon Valley office, the Defense Innovation Unit X, not far from Google’s headquarters. The outpost will scout for new and emerging technologies, help startups find new ways of working with the military, and serve as a West Coast base for recruits.

If what we reward in terms of federal moneys are people who have the knack for working with us rather than people who do the best job, that’s a disaster. Ashton Carter, Secretary of Defense

The Pentagon also has established a branch of the U.S. Digital Service, which puts techies to work on tough government problems for short periods. Already, 16 people are helping out in three teams. One, for example, is focused on making the health-record systems of the DOD and the Department of Veteran Affairs interoperable. “The technical community likes the problems we work on,” Carter said. “I’ve been taking them in on a temporary basis, saying, ‘Come do this for a year. You don’t have to be with us forever.’”

Carter also is helping the Pentagon invest in new technologies. He pointed out that the government can’t keep up with VC firms, but nonetheless, “I want to get more in that business.” Right now, the Pentagon makes small investments through In-Q-Tel, a nonprofit that has worked with the intelligence community to fund start-up companies working on security-related emerging technologies. “If that’s successful we’ll scale that up,” he said.

Meanwhile, Carter is addressing the legacy of Snowden’s actions by engaging tech’s leaders in conversation. The two communities need each other, he said, and his initiatives are, in part, a way he hopes to improve the relationship.

(Windows users, you’re OK!) What Is the Shellshock Vulnerability? – Lily Hay Newman SEPT. 26 2014 6:04 PM

Here’s what you need to know.

I know that my computer still has the Shellshock bug because it returns “this is a test” when I enter this system check. Also note that OS X Terminal is labeled “bash” at the top of the window.

This week you may have heard about something called Shellshock. It’s a vulnerability in something else called Bash. Oh, and Bash is a Unix shell. And the Shellshock vulnerability may be larger than Heartbleed—the bug in a widely used open-source encryption library that was revealed earlier this year. What the heck is going on? Let’s talk it out.

First of all, Unix is an operating system that appears in a lot of different forms. Apple’s OS X operating systems, for example, are Unix-based, but Unix is also widely used in servers and other networked devices like modems or security cameras. You run into it much more often than you think.

A Unix shell is your window into how the operating system is actually running. Instead of the graphical user interface (the thing we are usually interacting with on our personal computers), you type text directions into what’s called a command line, and instruct the computer to execute tasks. And you’re usually using a Unix shell like Bash through what’s called a terminal emulator. That’s why the command line program in Apple’s OS X operating systems is called Terminal.

OK, now let’s get to the vulnerability. Bash is great for accessing computers remotely because it’s text-only. If you have a keyboard, you’re good to go. But that also potentially makes it easy for a malicious hacker to remotely access computers that she shouldn’t. If there’s a vulnerability in Bash, she can exploit it. And there is.

Essentially, the bug comes from how Bash handles what are called “environmental variables.” If you know about the vulnerability, you can trick Bash into executing commands that it shouldn’t even be registering as commands. The malicious command can be sort of tucked into text that Bash should ignore. And it can direct a computer to download malware or wreak all kinds of havoc.

The reason it’s important to understand what Unix and Bash are is so you can begin to grasp how widely Bash is distributed. It’s the default Unix shell command line processor in OS X, Linux, and other operating systems. It’s not used in most Microsoft software—so the Windows operating systems and websites built with Microsoft tools should be safe from this vulnerability. But Bash has been around since 1989, so it’s in a lot of devices.

Even worse in terms of controlling this bug, Bash is used on the Internet by software that automatically interacts with other programs in certain prescribed situations. For example, there’s no human involved when a website queries a server for updated content.

At this point, patches are available for Unix and Linux. Apple is presumably scrambling to deliver one as well. In a statement to iMore, an Apple representative said, “The vast majority of OS X users are not at risk to recently reported bash vulnerabilities. … With OS X, systems are safe by default and not exposed to remote exploits of bash unless users configure advanced Unix services.”

Jim Traficant Was Our Kind of Crook A Youngstown tribute. – By VINCE GUERRIERI September 27, 2014

Nobody believed the stories I told about Youngstown until Jim Traficant was indicted – for the second time.

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My tales – about a judge who got disbarred, ran for mayor and won; a prosecutor who was the subject of an attempted assassination and his predecessor, who did time for corruption; a group of gangsters who incorporated their own municipality for the express purposes of hiding a brazenly-operated illegal gambling casino from local law enforcement – were too far-fetched to anyone who’d never lived in the steel town on the Ohio/Pennsylvania border.

But James A. Traficant Jr., a man who once had his salary garnished by the Internal Revenue Service for failing to report a bribe by organized crime figures on his income tax – was the living embodiment of every yarn spun about the region and its residents. He was the Congressman you’d call from central casting – if Quentin Tarantino was directing the movie.

Traficant died Saturday at the age of 73 following a tractor accident at a family farm in the hinterlands of Mahoning County. Shy of him actually being “beamed up” after a Congressional speech – a phrase he was fond of using when the world had become too strange even for him – this is how it had to end. The farm had proven his undoing once already.

When Traficant was indicted for a second time in 2002 by a federal grand jury, the allegations included getting local contractors and staff members to do work for him on the farm. Traficant pleaded not guilty “by reason of sanity” – a local political enemy tried to have him declared legally insane in the 1980s, and it didn’t take, leading him to declare himself sane ever since – and once again swore to defend himself in court.
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Former Managers Allege Pervasive Inventory Fraud at Walmart. How Deep Does the Rot Go? – Spencer Woodman  June 11, 2014  

The retail giant acknowledges that a “thorough review” is under way and vows “appropriate action” if violations are discovered.

(AP Photo/Damian Dovarganes)

In 2012, Erica Davidson, a Walmart veteran and store manager, took on the daunting task of turning around a struggling store on the outskirts of Greensboro, North Carolina. The store had run through its share of managers, Davidson said, and she viewed it as the sort of challenge that could make or break a person’s career.

Davidson said that one of her primary tasks was to reduce the troubled store’s high rate of “shrinkage”—defined as the value of goods that are stolen or otherwise lost—to levels deemed acceptable by the company’s senior managers for the region. As a result of fierce competition, profit margins in retail can be razor thin, making shrinkage a potent—sometimes critical—factor in profitability.

Prior to her arrival, Davidson said, the Greensboro store could see annual shrinkage losses as high as $2 million or more—a sizable hit to its bottom line. There had even been talk of closing the store altogether, she recalled.

For years, Walmart’s senior management in North Carolina had been waging a war on shrinkage, Davidson said; it had become a central priority of the company’s local leadership and a source of constant strain for store managers. Though the unrelenting pressure weighed on her, Davidson said she became an asset in Walmart’s battle against shrinkage—so much so that, in 2011, the North Carolina regional team named her a “subject matter expert” on reducing shrinkage and would send her to meetings in the Walmart regional office in Charlotte. There, she recalled, she would train district managers on her practices in the presence of the company’s most senior officers for the state.

The only problem, Davidson said, was that her superiors’ preferred methods for improving this vital metric were not always aboveboard; they included an array of improper techniques to conceal shrinkage losses and make the inventory numbers—and profit margins—look better on paper than they were in reality.

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That’s where the money is – May 31st 2014

How to hand over $272 billion a year to criminals

MEDICAL science is hazy about many things, but doctors agree that if a patient is losing pints of blood all over the carpet, it is a good idea to stanch his wounds. The same is true of a health-care system. If crooks are bleeding it of vast quantities of cash, it is time to tighten the safeguards.

In America the scale of medical embezzlement is extraordinary. According to Donald Berwick, the ex-boss of Medicare and Medicaid (the public health schemes for the old and poor), America lost between $82 billion and $272 billion in 2011 to medical fraud and abuse (see article). The higher figure is 10% of medical spending and a whopping 1.7% of GDP—as if robbers had made off with the entire output of Tennessee or nearly twice the budget of Britain’s National Health Service (NHS).

Crooks love American health care for two reasons. First, as Willie Sutton said of banks, it’s where the money is—no other country spends nearly as much on pills and procedures. Second, unlike a bank, it is barely guarded.

Some scams are simple. Patients claim benefits to which they are not entitled; suppliers charge Medicaid for non-existent services. One doctor was recently accused of fraudulently billing for 1,000 powered wheelchairs, for example. Fancier schemes involve syndicates of health workers and patients. Scammers scour nursing homes for old people willing, for a few hundred dollars, to let pharmacists supply their pills but bill Medicare for much costlier ones. Criminal gangs are switching from cocaine to prescription drugs—the rewards are as juicy, but with less risk of being shot or arrested. One clinic in New York allegedly wrote bogus prescriptions for more than 5m painkillers, which were then sold on the street for $30-90 each. Identity thieves have realised that medical records are more valuable than credit-card numbers. Steal a credit card and the victim quickly notices; photocopy a Medicare card and you can bill Uncle Sam for ages, undetected.

It is hard to make such a vast system secure: Medicare’s contractors process 4.5m claims a day. But pointless complexity makes it even harder. Does Medicare really need 140,000 billing codes, as it will have next year, including ten for injuries that take place in mobile homes and nine for attacks by turtles? A toxic mix of incompetence and political gridlock has made matters worse. Medicare does not check new suppliers for links to firms that have previously been caught embezzling (though a new bill aims to fix this). Fraud experts have long begged the government to remove Social Security numbers from Medicare cards to deter identity thieves—to no avail.

Start by closing the safe door

One piece of the solution is obvious: crack down on the criminals. Obamacare, for all its flaws, includes some useful measures. Suppliers are better screened. And when Medicaid blackballs a dodgy provider, it now shares that information with Medicare—which previously it did not. For every dollar spent on probing health-care fraud, taxpayers recover eight. So the sleuths’ budgets should be boosted, not squeezed, as now.

But the broader point is that American health care needs to be simplified. Whatever its defects, Britain’s single-payer National Health Service is much simpler, much cheaper and relatively difficult to defraud. Doctors are paid to keep people well, not for every extra thing they do, so they don’t make more money by recommending unnecessary tests and operations—let alone billing for non-existent ones.

Too socialist for America? Then simplify what is left, scale back the health tax-perks for the rich and give people health accounts so they watch the dollars that are spent on their treatment. After all, Dr Berwick’s study found that administrative complexity and unnecessary treatment waste even more health dollars than fraud does. Perhaps that is the real crime.