Wednesday, November 9, 2011

Complete DHS Daily Report for November 9, 2011

Daily Report

Top Stories

• A California jury convicted a man of attempted murder for a 6-month string of bizarre attacks on police that included improvised booby traps and the firing of a World War II-era bazooka at a police station. – Associated Press (See item 32)

32. November 7, Associated Press – (California) Southern Calif. man found guilty in series of bizarre booby trap attacks on police. A southern California jury November 7 convicted a man of attempted murder in a string of bizarre attacks on police that included improvised booby traps and the firing of a World War II-era bazooka at a police station. The suspect was found guilty of four counts of attempted murder of a police officer, all for orchestrating attacks against the same Hemet police detective who had arrested him on a drug charge, a Riverside County district attorney’s spokesman said. In one instance, natural gas was rerouted into the office of a gang task force and rigged to explode. In the bazooka attack, a training rocket was fired from the roof of a nearby market and started a small fire. The bold attacks began in late 2009, putting police officers on edge and unsettling Hemet, about 80 miles southeast of Los Angeles. The attacks stemmed from the suspect's anger at a detective, who had arrested him earlier in 2009, prosecutors said. On December 7, 2009, the detective discovered a booby trap outside his Hemet home. It consisted of a board lined with nails connected to a trip wire that led to his unmarked cruiser. The nails were barbed and smeared with fecal matter. Over the next 6 months, members of the Hemet-San Jacinto Valley Gang Task Force were targeted in eight more suspicious incidents, including arsons and attempted shootings. Jurors convicted the suspect of 11 felonies, including conspiracy and assembling a booby trap. He faces multiple life terms in prison at his sentencing, scheduled for December 2. Source:

• On the morning of November 7, a software glitch in the Internet's "Border Gateway Protocol" created a ripple effect that crashed data networks around the world, forcing millions of people offline. – CNN Money (See item 39 below in the Information Technology Sector


Banking and Finance Sector

11. November 8, South Florida Sun-Sentinel – (Florida) Former Plantation police officer pleads in mortgage fraud case. A former Plantation, Florida police officer faces up to 5 years in prison after reaching a plea deal November 7 with federal prosecutors who had alleged he orchestrated more than $16 million in mortgage fraud in South Florida. He had been the central target in the federal mortgage fraud investigation codenamed "Operation Copout" that resulted in the arrests of eight current and former law enforcement officers involved in what were alleged to be suspicious real estates transactions. All of them did business through the man's company, The Home Buyers Group LLC. He went on trial earlier in 2011 on 33 criminal charges resulting from "Operation Copout," but a Fort Lauderdale federal jury was unable to reach a verdict after a trial that stretched over 5 months. He pleaded guilty November 7 to a single count of conspiracy to commit fraud with prosecutors dropping all the other charges against him. He admitted he submitted loan applications containing false information so his investors could obtain mortgages that otherwise would have been out of their financial reach. Of the eight current and former law enforcement officers arrested in the investigation, two others were convicted of mortgage fraud charges. The defense of all the former and current law enforcement officers largely focused on the two mortgage brokers who handled the loan applications. The officers' attorneys argued their clients did not know the mortgage brokers were adding false information and forging signatures. Those brokers cut plea deals to testify. In addition to law enforcement officers, two attorneys were arrested as part of the investigation. Source:

12. November 8, Honolulu Star-Advertiser and Associated Press – (International) FBI warns of scheme using tinted currency. The FBI November 7 warned of a currency scam that might target wealthy Asia-Pacific Economic Cooperation (APEC) delegates in Hawaii. In the scam, construction paper is passed off as U.S. money that has been dyed black so it could be smuggled into the country without alerting U.S. Customs. The con men persuade the victim the dye can be removed, and ask for money to buy necessary chemicals, according to the FBI. In exchange, the victim is offered some of the black money. The swindlers then disappear with the real money. On November 4, the proprietor of a Honolulu self-storage company contacted the FBI after two men, who identified themselves as Liberian, paid cash October 11 to rent a small storage locker for a month, a FBI Special Agent said. Inside, they placed only two black suitcases. After obtaining a search warrant, the FBI opened the suitcases and discovered 120 pounds of black construction paper cut to the size of U.S. bills and shrink-wrapped. White glue, iodine, empty glass vials, a hair dryer, and vitamin C powder — materials needed for the scheme — were also in the suitcases, the Special Agent said. The Associated Press reported the scam recently hit New England states, where three people lost $170,000, according to the Secret Service. In Rhode Island the Secret Service arrested two Liberian nationals who allegedly attempted to deceive an undercover agent. Some of the con men have used e-mail to ensnare victims, but others, such as in the New England cases, go to nightclubs or restaurants, targeting potential victims wearing expensive jewelry or driving luxury cars. The FBI said the scam has been promoted over the years by Nigerians, Ghanaians, and Liberians. Source:

13. November 7, Press of Atlantic City – (New Jersey) Ventnor resident charged in fraud scheme that netted $8.5 million. A Ventnor, New Jersey resident was one of five men charged by the New Jersey Attorney General's (AG) Office November 7 with allegedly running a Ponzi scheme that defrauded dozens of investors out of $8.5 million. In the complaint, he was charged along with several others involved with the Liberty State Financial Holdings Corporation of Cherry Hill. The five were alleged to have run a "fraudulent scheme" of selling 3-year notes promising a 12 percent annual rate of return to 73 investors, "many of whom were elderly and retired," the state AG's office said in a statement. The investors were told the funds would be invested in life insurance policies and interests in Irrevocable Life Insurance Trusts. The complaint alleges none of the defendants or securities were registered with the state bureau of securities, and that part of the $8.5 million raised was used to pay off other investors. In addition, $5 million in investor funds was allegedly "improperly transferred" to the defendants, their families, and a law firm owned by one of the men, the charges stated. The state AG added the state was "working to obtain restitution for the defrauded investors, plus assessments of civil penalties against the defendants." Source:

14. November 7, Bloomberg – (National) Fundraiser’s brother-in-law pleads guilty in bank fraud case. The brother-in-law of a former fundraiser for the U.S. President and Secretary of State pleaded guilty to misdemeanor bank larceny in federal court in Manhattan, New York, November 7. The fundraiser, sentenced in 2010 to 12 years in prison, was charged with cheating Citigroup Inc., HSBC Holdings Plc., and Bank of America Corp. of $292 million. The brother-in-law, the owner of Blue Gecko Inc., a home electronic equipment installer in Colorado, pleaded guilty to avoiding knowledge the fundraiser was using him to advance the fraud. “In August ‘09, [the fundraiser] asked me to create account statements that were outside of the usual quarterly period,’’ the brother-in-law said in a court hearing. ‘‘I was suspicious that [he] may be using me to do something illegal, but because of his stellar reputation and the fact that he was connected to the most influential of people, I did not act on my suspicions.’’ He faces as much as 1 year in prison when he is sentenced. Prosecutors originally charged him with two counts of bank fraud, each of which carried a possible sentence of as much as 30 years. Source:

15. November 7, East Cobb Patch – (National) Cobb woman guilty in telemarketing scam. A Marietta, Georgia woman whose husband has pleaded guilty to telemarketing fraud charges was convicted by a federal jury November 7 for her role in the $25 million nationwide scheme. She was found guilty on nine counts of wire fraud, seven counts of structuring financial transactions, and two counts of conspiracy. Her husband and two others pled guilty before her trial of conspiring to defraud consumers with credit card interest rate deduction programs through various schemes and companies, according to the U.S. attorney's office in Atlanta. The fraudulent activities occurred during 2008 and 2009. According to the indictments, consumers in 46 states received automated phone calls and were connected to a telemarketer, who promised them lower interest rates on their credit cards and to help them get out of debt faster. Consumers were charged between $749 and $1,495 for the services and were promised a full refund of their purchase price if they did not achieve $4,000 in savings. But according to the evidence presented at the trial, consumers were not provided the services they paid for. The U.S. attorney said the defendants set up at least three fake companies based in Atlanta — VP Marketing, Economic Relief Technologies, and SafeRide Warranty — and used other phantom company names as cover for the fraudulent services. In December 2009, the Federal Trade Commission issued a restraining order against three of the defendants, and a receiver was appointed to take over the fake companies. The wife faces a maximum of 25 years for each mail fraud count, 10 years for each structuring count, and 5 years for each conspiracy count. She also could be fined up to $500,000 for each structuring account. Source:

Information Technology Sector

35. November 8, Computerworld Australia – (International) Researcher plants rogue app in Apple's App Store. Apple's App Store can be stocked with malware-infected apps by exploiting a bug in iOS, a noted security researcher said November 7. A principal research consultant for Denver-based security consultant Accuvant used an unknown flaw in Apple's mobile operating system to create an app that "phoned home" to his own server. He built a fake stock ticker app, dubbed "Instastock," as a proof-of-concept, then submitted it to Apple, who approved and placed it in the App Store in September. Instastock exploited the bug the researcher discovered to ping a server at his home and request to download another file. While he did not stock his server with such a file — except briefly for demonstration and testing purposes — it proved the app could secretly download rogue code. Such "malware" could conceivably issue commands to an iPhone or iPad, stealing contacts and photos, turning on the device's camera or microphone, or sending text messages. Source:

36. November 7, IDG News Service – (International) NSS Labs claims new tool can detect all Duqu drivers. Security research firm NSS Labs released an open source scanning tool capable of detecting all malicious drivers used by the new Duqu threat, according to its engineers. However, other security vendors believe the malware's creators are capable of evading detection at any time. According to NSS Labs, its scanner uses advanced pattern recognition techniques and was created to further research Duqu. The security company claims the tool is capable of detecting Duqu drivers without any false positives, and that it even picked up two samples discovered after its creation. However, the director of the global research and analysis team at antivirus vendor Kaspersky Lab raised some concerns about the tool's scope. "It's useful, however I believe its heuristics rules are too narrow," he said. According to him, any heuristic tool that detects Duqu drivers should also detect the Stuxnet ones, because of the high similarity between them. This does not appear to be the case with the new NSS Labs scanner. Source:

For more stories, see items 38 and 39 below in the Communications Sector

Communications Sector

37. November 8, Batavia Daily News – (New York) Phone service disrupted in Le Roy, Pavilion. Frontier telephone customers in Genesee County, New York, including the towns of Le Roy and Pavilion, were unable to call out of the local area the morning of November 8, the Batavia Daily News reported. The disruption affected Frontier customers in the 585 area code with phone numbers beginning 768 or 584. These customers were unable to dial out of their local area, according to an alert issued by Genesee County Emergency Management via the state's emergency alert system. The alert said 911 calls would be answered and transferred to the Genesee County 911 Center. The "Telecommunications Disruption Alert" was issued about 11:15 a.m. November 8. Source:

38. November 8, Nashua Telegraph – (New Hampshire) FairPoint’s FAST broadband struggles to rebound from outages. FairPoint’s fiber-optic broadband service is struggling to recover from the power outage that began the week of October 31 due in large part to software issues at a central office in Nashua, New Hampshire, with customers facing dead connections for the FAST service in a dozen communities, including Nashua, Hudson, Merrimack, Brookline, and Pelham. A FairPoint spokesman said the company would be "resyncing" a half-dozen optical line terminals the night of November 7 in the Nashua central office, which channels the ultra-high-speed Internet service in many surrounding communities. He said this software change should fix most of those in the Nashua area whose FAST service is down, except for customers with problems relating to line damage. As with cable service, FairPoint’s FAST service doesn’t work without power once its battery packs run out, so customers did not realize there was a problem until after PSNH restored electricity. Most callers said power returned November 7 or November 8, and as of the next day they were contacting FairPoint. Some of those also lost their telephone service, which operates through FAST rather than over traditional telephone lines or cell phones. Most of the FAST network, which covers parts of 24 communities in southern New Hampshire, was built as FiOS by Verizon before that company sold its landlines to FairPoint in 2008. A FairPoint spokesperson said the company received "about 400" trouble reports about the FAST network –- as compared to telephone service or its DSL Internet service, both of which run over copper wires rather that fiber-optic lines –- and "about 315" of the reports were from the areas served by the Nashua central office. The spokesperson said part of the delay was caused by the fact that FairPoint crews can not start working until power company repairs are done. Source:

39. November 7, CNN Money – (International) Internet routing glitch kicks millions offline. On the morning of November 7, a software glitch in the Internet's "Border Gateway Protocol" created a ripple effect that crashed data networks around the world. The outage appears to have originated with Juniper Networks, a company that makes router hardware for large networks. A set of updates to a core Internet routing protocol triggered a software glitch in some of Juniper's routers. When those routers crashed, key Internet pathways went down with them. Time Warner Cable, one of the largest Internet providers in the United States, suffered a short but widespread blackout. But Time Warner's problem most likely originated even further upstream: Level 3, a so-called "tier 1" network and one of the key Internet gateways in the U.S., got caught in the crash. "Shortly after 9 a.m. [Eastern Time November 7], our network experienced temporary service interruptions across North America and Europe apparently due to a router manufacturer software issue," Level 3 said in a statement released to reporters. "It has been reported that a similar issue may have affected other carriers as well. Our technicians worked quickly to address the issue and service is now fully restored." While Level 3 did not name names, Juniper confirmed its systems ran into trouble November 7: "This morning, Juniper learned of a Border Gateway Protocol edge router issue that affected a small percentage of customers," the company said in a statement to CNN Money November 7. "A software fix is available, and we've been working with our customers to immediately deploy the fix." Internet monitoring service AlertSite said its systems picked up "a measurable event during the 9-10 a.m. hour." That "event" took down systems big and small. Many BlackBerry users found their devices temporarily knocked offline. Tweet shortening service was another victim, temporarily rendering all of its links unusable. By late morning, most sites were back to normal, shaking off the sluggishness that typically follows a major routing glitch. Source:

For another story, see item 35 above in the Information Technology Sector