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Carbon Trading Halted After EU Exchange Is Hacked 228

Posted by timothy
from the can-we-have-a-mulligan dept.
chicksdaddy writes "The European Commission (EC) suspended trading in carbon credits on Wednesday after unknown hackers compromised the accounts of Czech traders and siphoned off around $38 million, Threatpost reports. EU countries including Estonia, Austria, The Czech Republic, Poland and France began closing their carbon trading registries yesterday after learning that carbon allowances had been siphoned from the account of the Czech based register. A notice posted on the Web site of the Czech based registry said that it was 'not accessible for technical reasons' on Thursday and the EC issued an order to cease spot trading until January 26 so that it can sort out what appears to be chronic security lapses within the system."
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Carbon Trading Halted After EU Exchange Is Hacked

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  • by elrous0 (869638) * on Thursday January 20, 2011 @01:36PM (#34942488)

    I always assumed this whole silly emissions trading business was just one big scam already.

    • Re: (Score:2, Interesting)

      by DiamondGeezer (872237)
      This scam is just the tip of the (melting) iceberg. Huge amounts of money have been scammed for hot air. If only we could make James Hansen personally liable...
      • by cayenne8 (626475) on Thursday January 20, 2011 @02:28PM (#34943176) Homepage Journal
        Yeah...it is all a big crock.

        I'm surprised people/companies were actually seriously putting any type of serious money into this crap.

        Are there some countries that are actually mandating carbon credits, etc? I mean, if not by law, why would anyone take part in this scam, unless they were on the money making side?

        • by hitmark (640295) on Thursday January 20, 2011 @03:29PM (#34943946) Journal

          Consider that people buy and sell goods and services in WoW for actual money.

          Also, these kinds of markets is the "cure-all" of classical economist orthodoxy.

          And as long as there is a chance to make a profit on it, someone will put money into it.

          In the end, it is no different from the recent CDOs and such. It is all numbers being traded via computers...

        • by c6gunner (950153) on Thursday January 20, 2011 @03:51PM (#34944244)

          I mean, if not by law, why would anyone take part in this scam, unless they were on the money making side?

          Guilt? Good public relations? There are plenty of reasons. Penn and Teller did a decent episode on it - they exposed some of the "carbon credit" companies for the scams that they are, and they also sent out a woman to randomly approach people doing their shopping, "assess" their purchases for carbon emissions (by randomly throwing out numbers) and then ask them to pay for the environmental damage. Most people seemed glad to fork over the cash.

          • by cayenne8 (626475)
            "Guilt? Good public relations? There are plenty of reasons. Penn and Teller did a decent episode on it - they exposed some of the "carbon credit" companies for the scams that they are, and they also sent out a woman to randomly approach people doing their shopping, "assess" their purchases for carbon emissions (by randomly throwing out numbers) and then ask them to pay for the environmental damage. Most people seemed glad to fork over the cash."

            WOW!! REally? Ok..I'm gonna have to go look for these video

    • Re: (Score:2, Interesting)

      by Anonymous Coward
      Yes, it is. The news here is that someone scammed the scammers. That's the 21st century Robin Hood for you (and definitely better than that movie).
      • by dgatwood (11270)

        That movie was hilarious. Oh, wait, you weren't talking about "Men in Tights"? Never mind.

    • by erroneus (253617)

      Yes it is a scam. The very idea of "paying for the right to pollute" is simply bad and wrong. What they should be paying for is the cost of cleaning up and compensating everyone who has been damaged by their pollution. (Yes, I am aware of standard arguments such as "resulting in higher unemployment" and "passing the cost onto you, the customer" and all that crap. That's why markets where supply and demand do not apply require regulation. Such markets include utilities, medical/healthcare and any other

      • by OzPeter (195038)

        Yes it is a scam. The very idea of "paying for the right to pollute" is simply bad and wrong.

        what do think an EPA permit is? It is actually a permit to emit pollution to the current standards. It is not a permit that stops you from polluting.

      • But that's like focusing on fire suppression over fire avoidance. What you ultimately want is a system that optimizes the cost/benefit analysis (where cost and benefit can go far beyond calculating how much material was destroyed in a fire, and how much it cost to put out). There's a reason there are fire codes for buildings in fire areas: if you can prevent a house from catching on fire rather than putting it out, it is very likely that the overall cost to society is lower.

        The same idea is behind carbon tr

    • Because it was a government program, because it seems like a political cop out rather than dealing with the problem, because it focused on making money change hands between buisiness people rather than directly reducing carbon emissions, and / or because you're one of those people who trust oil and gas lobbyists rather than scientists?

      I mean, I always assume that if I have doubts on something, I should explain myself. I guess the mods today like baseless skepticism though, so I'll pander to that:

      For every

  • How much Carbon Credits do I get for the consumption of Jolt and Baconnaise sammichs? Is it prorated if I code in Perl?
  • by Huzzah! (1548443) on Thursday January 20, 2011 @01:43PM (#34942594)
    I don't take Czechs.
    • by CCarrot (1562079)

      I don't take Czechs.

      Gah, phew, that one stunk! Somebody open a window!

      Whoever modded you 'Troll' is obviously missing his/her punny bone...

  • by OnceWas (187243) on Thursday January 20, 2011 @01:53PM (#34942712)

    How does one liquidate siphoned carbon credits? Do they hold a black market value?

    • by rubycodez (864176) on Thursday January 20, 2011 @02:01PM (#34942822)
      they are bought and sold with REAL MONEY. there are billions of euros changing hands because of this nonsense. What a beautiful scam, declare a gas absolutely essential to life on the earth a poisonous taxable thing. Add some alarm over weather events of the past few years: "climate change will cause more powerful hurricanes! (after one year of strong hurricanes). "climate change will cause drought" (after perfectly predictable cyclical drought happened for a couple years, same as seven decades ago) At the moment it's "climate change is causing floods and hard winters!" (again, same shit different century). Add even more alarm with "sea levels are rising and island nations are going underwater". Of course, the sea has been rising since the last ice age and those lands which were essentially at sea level anyway within less than ten cm tolerance were doomed anyway. Anti-scientific rubbish to line the pockets of certain cartels.
      • by blueg3 (192743) on Thursday January 20, 2011 @02:35PM (#34943272)

        What a beautiful scam, declare a gas absolutely essential to life on the earth a poisonous taxable thing.

        A few points:
        * CO2 is, in fact, poisonous (well, toxic).
        * CO2 emissions restrictions have nothing to do with whether CO2 is poisonous, since obviously it's not poisonous at atmospheric concentrations.
        * "Essential to life" and "poisonous" (toxic) are not mutually exclusive. Besides carbon dioxide, there's oxygen and quite a few metals, to say nothing of fancier things like fat-soluble vitamins.
        * "Essential to life" and "problematic in sufficiently large quantities" aren't mutually exclusive, either. Water comes to mind.

        • by Talderas (1212466)

          * CO2 is, in fact, poisonous (well, toxic).

          Fact: Oxygen is, in fact, poisonous.
          Fact: Water is, in fact, poisonous.
          Fact: Every god damn substance on earth is, in fact, poisonous.

          • by blueg3 (192743)

            Good thing you read down to bullet points 3 and 4. :P

            Oxygen is toxic. To my knowledge, water is not really toxic, although too much water can certainly be a problem.

            To be fair, whether something is a poison depends on what definition you're using. If Paracelsus says everything is a poison, it can't be too far off the mark.

      • by hedwards (940851)
        Precisely how is this different than when the government leases out spectrum, land or the public right of way? Those are all things which are rivalrous in nature and without the government or some other body stepping in you end up with the tragedy of the commons situation.

        I realize that it's popular amongst libertarians to cry bloody murder whenever the government does something, but give me a break. Unless you can propose a way of your carbon emissions not affecting everybody else, you kind of have to j
      • by choongiri (840652)

        There is a scam, and it's that the pro-market solutions camp has managed to convince governments we can trade our way out of this mess. You're absolutely right that there are huge amounts of money being made off of false solutions. However, there is absolutely no doubt about one thing: they are false solutions to a real problem.

        As for the rest of your drivel, you either have no understanding of the science, are being paid to astro-turf, or (as I suspect is actually the case for most people that spout off yo

  • A sense of schadenfreude without the usual guilt is giving a bounce to my steps. Cap-and-traders got their noses bloodied, tra-la-la-la-la!

  • how do they deliver $38 million worth of coal ash to the hackers? i hope the hackers live near a rail line so they can take delivery of what they siphoned off

  • by gurps_npc (621217) on Thursday January 20, 2011 @01:58PM (#34942774) Homepage
    Corret me if I am wrong but:

    1. They stole the 'carbon credits', not electronic cash.

    2. You can't legally sell them anywhere except via the exchange.

    3. The exchange tracks all legal sales.

    4. Therefore, can't the government require the exchange to show all legal sales and invalidate the unapproved sales?

    Isn't that the entire value of using the exchange? To track the sales of said credits?

    Assuming that they have already used the exchange to sell the the fraudlenty exchanged credits, is it not a relatively easy matter to find the account that sold the stolen carbon credits and force them to buy them back?

    This assumes of course that it was actually carbon credits that were stolen instead of cash stolen from un-authorized trades (in which case, the article needs to be re-written, removing the sensational crap)

    • by yuna49 (905461) on Thursday January 20, 2011 @02:11PM (#34942964)

      They may have sold the credits already. The WSJ piece [wsj.com] I submitted about this story has more details:

      "It started when an anonymous caller on Tuesday morning told Czech State Police that explosives had been placed at the offices of OTE AS, a private company that manages the Czech Republic's national registry. The police evacuated the registry for five hours.

      During that time, the computer network wasn't monitored, OTE officials said. Hackers stole 475,000 allowances, worth 7 million, from a company called Blackstone Global Ventures, an environmental consultancy that trades carbon credits for industrial companies.

      The thieves changed account-ownership information and executed illegal trades, said Nikos Tornikidis, a portfolio manager at Blackstone Global Ventures."

      My guess is that they executed the trades and siphoned the proceeds off to a bank account somewhere.

      • by gurps_npc (621217)
        So basically it was the last option - the thieves engaged in unauthorized trades then stole the resulting CASH.

        But some idiot decided that it would be a bigger news story if they lied and claimed they stole the carbon credits.

        Cancel the illegal trades, then go through all the normal procedures that you deal with when someone convinces a financial organization to give out cash to people that were not authorized to receive it.

  • If there's money to be made, assume there will be people who don't want to actually do the work to get the money... and that they'll circumvent rules, regulations, laws, treaties, barriers (physical and digital) to get to that money. Moreover, it's safe to assume that if there's a consistent, reliable flow of money, that these dishonest or disingenuous people will plant themselves or others in the system to make the siphoning easier.

  • by CrAlt (3208)

    "siphoned off around $38 million..."
    Isn't this the whole point? To just siphon off money for nothing?

    So I own a coal power plant. I trade some cash for CREDITS from some cleaner nation instead of cleaning up my plant.
    What are these nations giving in exchange for the cash? A promise to not cut down a tree? A promise to NOT build a factory in their nation? How does one produce and sell credits on this market? My business doesn't produce any pollution so we should have tons of credits to sell.

  • by Just Brew It! (636086) on Thursday January 20, 2011 @02:12PM (#34942968)

    While carbon credits may sound like a good idea in theory, I had assumed from the start that they were doomed to fail in practice. How do you verify that a company that sells credits has really reduced their own carbon footprint by the requisite amount? It just seems too easy to game the system.

    I hadn't considered the possibility of cyber-criminals simply stealing the credits outright; that makes matters even worse!

    Shouldn't these credits be individually traceable, so that the stolen ones can simply be voided and re-issued? If not, then someone really f**ked up the implementation of this system.

    • by blueg3 (192743)

      How do you verify that a company that sells credits has really reduced their own carbon footprint by the requisite amount?

      Same way you determine whether or not they're within the limits in an emissions-cap system, I suppose. Probably roughly the same way they're within environmental pollution regulations.

      I'm not saying it's necessarily easy, but it's a problem shared by all systems for reducing emissions.

      • Probably roughly the same way they're within environmental pollution regulations.

        I'd be willing to bet that for each instance where someone gets caught flouting environmental pollution regulations, there are at least three more who are getting away with it. Seems to me the temptation to cheat the carbon trading system would be even stronger, since it is essentially "free money".

  • by kanto (1851816) on Thursday January 20, 2011 @02:31PM (#34943212)

    The European Commission (EC) suspended trading in carbon credits on Wednesday after unknown hackers compromised the accounts of Czech traders and siphoned off around $38 million

    According to Wall street journal [wsj.com] (original poster yuna49 [slashdot.org]) the latest theft was $7 million and the $38 million (0.02% of the market) is the total of the permits missing in action.

  • I haven't done a lick of descent research into them, but they always sounded like a silly, ineffective idea. What a surprise to find out that there's a Wall Street trading angle on the whole thing...

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