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Security

Submission + - NASDAQ targeted by hackers (computerworlduk.com)

Submitted by DMandPenfold
DMandPenfold writes: Hackers have hit the websites of the NASDAQ and BATS stock exchanges.

NASDAQ and BATS saw their sites disrupted during the day on Monday and Tuesday respectively. The sites host company news and share price data, as well as vital information on live service status on the exchanges.

It is understood, however, that while the websites were affected, the stock exchanges continued to trade as normal with no change to trading.

A spokesperson at BATS said the exchange's site had been hit with "an external Distributed Denial Of Service (DDoS) incident".

"Our trading systems were not affected and there were no exchange customer disruptions associated with the incident," she added. "We worked with our internet service provider and swiftly returned our website to a normal operating state. Our trading systems continue to operate normally today."

BATS said it would continue to be "vigilant in protecting our systems from future threats".

NASDAQ told the Wall Street Journal that on Tuesday it experienced "intermittent service disruptions on our corporate websites".

It is not known who initiated the attacks.

In 2010, NASDAQ's Directors Desk online scheduling application was compromised by hackers. An FBI investigation found that the stock exchange's ageing software and out of date security patches played a key part in the problems.

Last month, in separate incidents, the Saudi Arabia and Abu Dhabi stock exchanges were targeted by hackers, slowing trading.
Network

Submission + - Boffins embed electronic components into optical fibres (techworld.com)

Submitted by Anonymous Coward
An anonymous reader writes: Scientists at the Universities of Southampton and Penn State have found a way to embed electronic components into optical fibres, in a breakthrough that could lead to the creation of super high-speed telecommunications networks.

Rather than trying to merge flat chips with round optical fibres, the team of scientists used high-pressure chemistry techniques to deposit semiconducting materials layer by layer directly into tiny holes in optical fibres. This bypasses the need to integrate fibre-optics onto a chip, and means that the data signal never has to leave the fibre.
Businesses

Submission + - Dell execs in massive insider trading probe (computerworlduk.com)

Submitted by DMandPenfold
DMandPenfold writes: Two former Dell employees, including a former investor relations manager, were part of a $62 million record-breaking insider trading scam, involving the company's shares as well as Nvidia stock, according to the FBI.

The news comes as the US authorities step up their pursuit of inside traders. Two months ago, Galleon hedge fund founder Raj Rajaratnam was sentenced to 11 years in jail for his role in a scam involving AMD, IBM and 3Com stock.

Yesterday, Sandeep Goyal, an employee at Dell's US headquarters between 2006 and 2007 before becoming a financial analyst, was arrested. An unnamed co-conspirator in Dell's investor relations department from 2007 to 2009 is also alleged to have been part of the scam. The co-conspirator has not been arrested, it is understood.

Goyal allegedly made $175,000 by providing inside information about Dell to a hedge fund. He has pleaded guilty to charges of securities fraud.

Jesse Tortura, a former analyst at Diamondback, and Spyridon Adondakis, formerly at Level Global, have also pleaded guilty.

Seven men in total are allegedly implicated in the scam, including Todd Newman, a senior manager with the Diamondback Capital Management hedge fund, and Anthony Chiasson, a co-founder at Level Global investors. Newman oversaw IT stock investments at Diamondback. Chiasson's Level firm principally trades in IT and finance shares. Both were arrested yesterday.

Jon Horvath, an employee at hedge fund Sigma Capital Management, and Danny Kuo of Whittier Trust, were also allegedly part of the scam. Both hedge funds trade in a range of share types.

All seven were charged with conspiracy to commit securities fraud, relating to profits made from trading Dell and Nvidia stock in 2008 and 2009.

Authorities even produced an email from Kuo to Adondakis, Tortura and Horvath, in which he openly states that he is providing insider information.

In one instance of profit from the scam, Level Global allegedly made $57 million from a tip ahead of Dell's results – which authorities branded as the largest single profit ever from inside information.

Dell said in a statement that it "has cooperated with government authorities". It added: "All Dell employees are required annually to complete training on the company's Code of Conduct, which includes a section on insider trading. Violations of these policies are treated seriously, and violations result in disciplinary action up to and including termination."

FBI assistant director Janice Fedarcyk said: "The FBI has arrested more than 60 people in 'Operation Perfect Hedge' [the hedge fund insider trading probe] to date, and this initiative is far from over.

"If you are engaged in insider trading, what distinguishes you from the dozens who have been charged is not that you haven't been caught; it's that you haven't been caught yet."
Businesses

Submission + - FBI scolds NASDAQ on out of date patches (computerworlduk.com)

Submitted by DMandPenfold
DMandPenfold writes: NASDAQ’s ageing software and out of date security patches played a key part in the stock exchange being hacked last year, according to the reported preliminary results of an FBI investigation.

Forensic investigators found some PCs and servers with out-of-date software and uninstalled security patches, Reuters reported, including Microsoft Windows Server 2003. The stock exchange had also incorrectly configured some of its firewalls.

NASDAQ, which prides itself on running some of the fastest client-facing systems in the financial world, does have a generally sound PC and network architecture, the FBI reportedly found.

But sources close to the investigation told Reuters that NASDAQ had been an “easy target” because of the specific security problems found. Investigators had apparently expressed surprise that the stock exchange had not been more vigilant.
Businesses

Submission + - Jaguar recalls 18,000 cars over major software fau (computerworlduk.com)

Submitted by DMandPenfold
DMandPenfold writes: Jaguar has recalled nearly 18,000 X-type cars after it discovered a major software fault, which meant drivers might not be able to turn off cruise control.

The problem lies with engine management control software developed in-house by Jaguar. The problematic software is only installed on diesel engine X-Types, which were all produced between 2006 and 2010.

Some 17,678 vehicles have been recalled, as a result of the potentially dangerous problem. If the fault occurs, cruise control can only be disabled by turning of the ignition while driving — which would mean a loss of some control and in many cars also disables power steering. Braking or pressing the cancel button will not work.

"Jaguar has identified that should an error with certain interfacing systems be detected the cruise control system will be disabled and an error message displayed to the driver on the instrument cluster," the company said in a statement.
Businesses

Submission + - UBS: Our risk systems did detect $2bn rogue trader (computerworlduk.com)

Submitted by DMandPenfold
DMandPenfold writes: UBS has insisted its IT systems did detect unusual and unauthorised trading activity, before rogue trader Kweku Adoboli ran up a $2 billion (£1.3 billion) loss on the bank’s derivatives desk.

Interim chief executive Sergio Ermotti, who is running the company following Oswald Grubel’s resignation last month, sent a memo to employees saying the bank is aware that its systems did detect the rogue activity.

In the memo, Ermotti wrote: “Our internal investigation indicates that risk and operational systems did detect unauthorised or unexplained activity but this was not sufficiently investigated nor was appropriate action taken to ensure existing controls were enforced.”

He added: “We have to be straight with ourselves. In no circumstances should something like this ever occur. The fact that it did is evidence of a failure to exercise appropriate controls.”

The news comes as the heads of UBS’ global equities business, Francois Gouws and Yassine Bouhara, also resigned.
Open Source

Submission + - UK: Open Standards Must be RF, not FRAND (computerworlduk.com)

Submitted by
Glyn Moody
Glyn Moody writes: "There has been a big battle in the UK over whether open standards should be Restriction/Royalty-Free (RF) or Fair, Reasonable and Non-Discriminatory (FRAND). That matters, because open source can't in general implement FRAND standards (there are legal hacks that can be applied in a few special circumstances.) First it seemed that RF had the upper hand [.pdf], but later comments from officials cast doubt on that. Now we have the definitive answer from the UK Minister for the Cabinet Office, Francis Maude: "The Government require that their ICT should be built on open standards, wherever possible, to improve competition and avoid lock-in to a particular technology or supplier. Fair, reasonable and non-discriminatory (FRAND) specifications may present some difficulties for the open source software development model in terms of patents and royalties. To deliver a level playing field for both open source and proprietary software, open standards are needed." Will UK government use of open source finally take off, or is this a hollow victory?"
Businesses

Submission + - Algo trading rapidly replacing need for humans (computerworlduk.com)

Submitted by DMandPenfold
DMandPenfold writes: Algorithmic trading, also known as high frequency trading (HFT), is rapidly replacing human decision making, according to a government panel which warned that the right regulations need to be introduced to protect stock markets.

Around one third of share trading in the UK is conducted by computers fulfilling commands based on complex algorithms, said the Foresight panel in a working paper published yesterday.

Nevertheless, this proportion is significantly lower than in the US, where three-quarters of equity dealing is computer generated.

The Foresight panel, led by Dame Clara Furse, the former chief executive of the London Stock Exchange, argued that there are both benefits and severe risks to algorithmic trading.

There was "no direct evidence" that the computer trading in itself increased volatility, it said, but in specific circumstances it was possible for a series of events with "undesired interactions and outcomes" to occur and cause massive damage.
Government

Submission + - US regulator hit with illegal data wipe complaint (computerworlduk.com)

Submitted by DMandPenfold
DMandPenfold writes: The Securities and Exchange Commission (SEC), the US financial regulator, has been accused of destroying thousands of data files on high profile inquiries including an early-stage investigation into convicted Ponzi scheme fraudster Bernard Madoff.

The allegations, raised by former SEC employee Darcy Flynn, have prompted the US Senate Judiciary Committee to write to SEC chairwoman Mary Schapiro to demand an immediate explanation.

The SEC exists to set a tough example on corporate governance, and it fines banks heavily for both lax practice and deliberate malpractice. Questions over any involvement it may have in sensitive document destruction are not likely to sit comfortably with some in the industry.

The regulator, which has won much-publicised multimillion dollar cases against malpractice at banks, has also been heavily criticised for missing numerous warning signs in its investigations, particularly around Madoff, and any destruction of files could be viewed unfavourably.

Senator Chuck Grassley, the senior Republican on the Senate Judiciary committee, said the data that the SEC is alleged to have destroyed – between 1993 and 2010 – also concerned investigations into alleged insider trading at Deutsche Bank, SAC Capital and collapsed bank Lehman Brothers; as well as into corporate practices during Goldman Sachs’ trading of complex products with insurer AIG.

The SEC insists is has kept records in accordance with the law on its computer system
Media

Submission + - Police in News of the World email investigation (computerworlduk.com)

Submitted by DMandPenfold
DMandPenfold writes: Police are questioning whether a change in News International’s email retention policy was part of an effort to conceal widespread phone hacking by the News of the World, a scandal which is threatening Rupert Murdoch’s planned takeover of BSkyB.

The trawl for emails and the questioning of changes in News International’s email retention policy has important implications for IT security and corporate governance professioals, and is likely to see organisations examining their own policies and reminding their staff on acceptable usage and best practice for email.

Submission + - SSDs cause crisis for digital forensics (techworld.com) 5

Submitted by rifles only
rifles only writes: Firmware built into many solid state drives (SSDs) to improve their storage efficiency could be making forensic analysis at a later date by police forces and intelligence agencies almost impossible to carry out to legally safe standards, Australian researchers have discovered.

They found that SSDs start wiping themselves within minutes after a quick format (or a file delete or full format) and can even do so when disconnected from a PC and rigged up to a hardware blocker.
Novell

Submission + - LSE price errors ‘emerged at Linux launch' (computerworlduk.com)

Submitted by DMandPenfold
DMandPenfold writes: Within the first 20 seconds of the London Stock Exchange’s new matching engine going live on Monday, price data vendors began displaying incorrect prices, blank prices and wrong trading volumes, according to Computerworld UK sources.

Thomson Reuters, Interactive Data and Netbuilder are among the largest data vendors, providing share prices to traders, that have been displaying pricing problems on some stocks throughout the week. Even the LSE’s own data vendor, ProQuote, experienced problems.

Concerns are being raised that there could be mistakenly setup connections or incorrect software interfaces at some of the large data vendors. Alternatively, there may be a data caching issue at the LSE that means data going out is not properly synchronised between different systems.

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