Market Data: 2008 December


Corruption runs rampant in China

Filed under: Asia, Financial Crime

The Los Angeles Times has an article highlighting the rampant corruption that is taking place in China. 

From Mark Magnier of the LA Times, Corruption taints every facet of life in China:

Corruption is an everyday experience for millions of Chinese that taints not just schools, but relations in business, on farms and in factories, and potentially any contact citizens have with officialdom. Foshan appears no more corrupt than any other city in China, experts say. It is noteworthy only as an example of a pervasive problem that threatens China’s stability and political system.

Senior Communist Party officials know that decades of remarkable economic progress are at risk if graft and bribery stretch the chasm between the haves and have-nots too wide. But they have limited room to maneuver. Any meaningful effort to crack down endangers the party’s monopoly on power.

The system depends on legions of police, local party and government officials to enforce Beijing’s policies and quash dissent. All too often, critics say, local officials regard their position as a license to steal.

Throughout the country, the prodigious rate of economic growth has created a gold rush mentality. Absent both the strictures and the social safety network of Mao Tse-tung’s rigid system, millions of people are seeking ways to prosper — legally or illegally.

Corruption accounts for an estimated 3% to 15% of a $7-trillion economy, and party membership can be an invitation to solicit bribes or cut illegal land deals. Membership hit 74 million at the end of 2007, a 10% jump from 2002, as moneymaking opportunities increasingly trumped ideology.

In addition to money, officials receive various goods and services, ranging from restaurant vouchers, study trips overseas, prostitutes, foot massages, and oversea tuition for children. 

Read the entire article here.

Online piracy hitting professional sports

Pirated streams of professional sports games are spreading across the Internet, creating concern for the professional sports league.

From the IHT:

After years of focusing on the pirating of highlight clips and photos on the Web, the major professional sports leagues are finding that pirated feeds of live games are now common and becoming a menace to their businesses, especially at a time when leagues are trying to build their own businesses offering live games on the Internet for a subscription fee.

The article mentions Major League Baseball and how online piracy is affecting the league. In 2007, MLB found 3,000 incidents of its live feed being pirated on the Internet. In 2008, they found 5,000 incidents.

More Chinese being smuggled into the United States

Filed under: Asia, Humans, United States

A recent case in Houston, Texas highlights the increasing number of Chinese nationals who are being smuggled into the United States.

According to Department of Homeland Security, there was a 49 percent increase in the number of illegal immigrants from China in the United States between 2000 and 2007.  Currently, the department estimates 290,000 Chinese immigrants are living in the United States illegally.

From the Houston Chronicle:

Human smuggling organizations have charged Chinese and other Asians immigrants fees of up to $25,000 to be smuggled into the U.S., usually by flying them to Latin America and then transporting them overland to the Texas-Mexico border.

The local increase mirrors a nationwide jump in the unauthorized Chinese population this decade, according to a Department of Homeland Security analysis released in September of the nation’s 11.8 million undocumented residents.

Child trafficking victims working in the United States

Filed under: Humans, United States

The Associated Press has a report out on children who are trafficked into the United States to work as domestic maids. 

From the AP (via Yahoo News):

The trafficking of children for domestic labor in the U.S. is an extension of an illegal but common practice in Africa. Families in remote villages send their daughters to work in cities for extra money and the opportunity to escape a dead-end life. Some girls work for free on the understanding that they will at least be better fed in the home of their employer.

The custom has led to the spread of trafficking, as well-to-do Africans accustomed to employing children immigrate to the U.S. Around one-third of the estimated 10,000 forced laborers in the United States are servants trapped behind the curtains of suburban homes, according to a study by the National Human Rights Center at the University of California at Berkeley and Free the Slaves, a nonprofit group. No one can say how many are children, especially since their work can so easily be masked as chores.

Screeners copies of bootleg movies traded by film professionals

Bootleg copies of movies that have yet to premier at film festivals are being traded amongst prospective buyers, according to a report by Reuters.

Completed and partially completed movies are being traded and watched by film distribution companies before the films can even be viewed at film festivals such as the Sundance Film Festival.

From Reuters:

Sundance DVDs and tapes have long been the open secret of the indie world. This year, though, there’s more noise about them, with some sellers saying that bootlegs are being traded faster than tapes at a Grateful Dead concert.

A hot market can sometimes ignite the black market, as buyers, eager to gain an edge, spare no effort in landing screeners. But a chillier finished-film market like the current one also can drive interest, with distributors scoping out films to determine how to deploy their more limited resources after they land on the ground.

Sales agents say that though the interest is flattering, there are plenty of dangers to this shadow economy.

Young girls trafficked for domestic help

Filed under: Humans

The Washington Post highlights the plight of young girls who are trafficked to work as domestic helpers.

From the Washington Post:

The number of girls like Adiza, who leave their communities or even their countries to clean other people’s houses, has surged in recent years, according to labor and human rights specialists. The girls in the maid trade, some as young as 5, often go unpaid, and their work in private homes means the abuses they suffer are out of public view.

The International Labor Organization (ILO), a U.N. agency based in Geneva, said more girls under 16 work in domestic service than in any other category of child labor. The organization said that maids are among the most exploited workers and that few nations have adequate regulations to safeguard them.

Rights groups say rural families often send their girls off to work willingly, as a way to escape poverty, not understanding the risks of abuse. And the employers are often only marginally better off. Having climbed a step or two on the economic ladder, they can afford one of the first trappings of prosperity: a girl to do the chores.

Man arrested for smuggling mummies

Filed under: Africa, Culture

A man was detained in Egypt after airport security officials found mummies in his luggage.

According to a report from the BBC, the man was attempting to smuggle numerous antiquities out of the country.

From the BBC:

An airport official said the mummies of a cat and an ibis, a long-beaked bird, dated back to 300 BC.

He said another 19 figurines of ancient Egyptian gods were also found in the passenger’s bags.

The man has been charged with smuggling antiquities, which can carry a penalty of up to 15 years in prison.

Hackers attempt to rule online black market

Filed under: Transnational Crime

Wired Magazine has a fascinating article on a hackers attempt to gain control over the online black market trade in stolen credit cards.

The report follows the trail of Max Butler, a computer hacker who attempted to consolidate the online marketplace of stolen credit cards.

From Wired Magazine:

Settling into his chair and resting his fingers on his keyboard like a concert pianist, Butler began his attack. Most illegal online loot was fenced through four so-called carder sites—marketplaces for online criminals to buy and sell credit card numbers, Social Security numbers, and other purloined data. One by one, Butler took them down. (This story, like the rest of this article, has been reconstructed using court documents and conversations with friends and associates; Butler declined to be interviewed.) First, he breached their defenses, tricking their SQL database servers into running his own commands or simply slipping in with a hacked password. Once inside, he sucked out their content, including the logins, passwords, and email addresses of everyone who bought and sold through the sites. And then he decimated them, wiping out the databases with the ease of an arsonist flicking a match. He worked for two straight days; when he tired, he crashed out on the apartment’s foldaway bed for an hour or two, then got up and went back at it. Butler sent an email under the handle Iceman to all the thieves whose accounts he had usurped. Whether they liked it or not, he wrote, they were now members of his own site, CardersMarket.com. In one bold stroke, Butler had erected one of the largest criminal marketplaces the Internet had ever seen, 6,000 users strong.

Read the entire story here.

South Korean Web portals indicted over piracy

Two web portals in South Korea were indicted for allowing users to post unlicensed songs on their servers.

From the AP (via Google News):

Two subsidiaries of NHN Corp. and Daum Communications Corp. were charged with allowing users to post music files on their blogs and personal sites and let other users copy and post the files on their sites, according to prosecution official Lee Kwang-ho.

Prosecutors believe NHN Services and Daum Service, the respective subsidiaries, have the technology to block the piracy activities and are seeking a 30 million won ($22,160) fine for each of the firms, Lee said.

According to the AP, this is the first time that an Internet firm was indicted.

Organized Crime increases in China as economy worsens

Organized Crime activity is increasing in China as the economy worsen and more people get involved in illicit activities,   according to state officials.  Black market activities such as prostitution, gambling, and drug trafficking and production are all being targeted by security officials.

From the AP (via Google News):

Security officials will also keep a close eye on possible crimes stemming from unemployment amid the ongoing financial downturn, the report said.

Liang Huaren, a law professor at the China University of Political Science and Law, was quoted as saying that the large numbers of laid-off migrant workers as well as the widening gap between rich and poor has helped fuel an increase in gang-related crimes.

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