Mar 31, 2013

The other cost of doing business

Carl Mather lifted his four-year-old girl into his large tattooed forearms as he walked along the corridor of his Nanjing apartment and peered through the eye hole in the door.
The 53-year-old Australian teacher opened it to a man he knew, his compound manager Gao Long, but three others sprang from hiding places and forced their way in.
They were demanding to see his wife, Xie Qun, in a language he couldn't understand, and he feared they would abduct their daughter for leverage in an ongoing dispute over Ms Xie's candy trading business.
He let his screaming daughter down to run to her grandmother while the biggest of the intruders - a man with extensive assault convictions - pushed against his throat and the others beat his upper body.
In desperation he ran to pick up a stick - but they grabbed it from him - and then a kitchen knife.
Since November, Mr Mather has spent his days in a small Chinese prison cell, shared with 15 men, while the assailants he reported to police have never been investigated.
"The local police hate us because we are in the way of making more money," Mr Mather's wife, Ms Xie, told Fairfax Media.
The jailing of another Australian has raised new questions about the risks of doing business in China, just as Prime Minister Julia Gillard prepares to lead up to a dozen top corporate leaders to a Chinese tropical island resort.
The high-powered delegation will attend next weekend's Bo'ao Forum for Asia, which has grown in standing as the size of the Chinese economy approaches that of the United States.
China buys a greater share of Australia's exports than any other developed nation. But this year's forum is taking place amid concerns of a deteriorating Chinese legal environment coupled with rising nationalism and protectionism.
The world's second-largest company, Apple, is currently the subject of a systematic assault by state propaganda outlets for alleged ''arrogance'' in
dealings with Chinese consumers. A series of Australian entrepreneurs have paid a more personal price.
Fairfax Media has previously revealed a series of murky prosecutions of Australians citizens, beginning with the 2009 arrest of Rio Tinto iron ore executive Stern Hu, that appear to have been linked to Chinese partners attempting to secure commercial advantages.
While court evidence later demonstrated that Mr Hu took bribes, the cases of college educator Charlotte Chou, travel entrepreneur Matthew Ng and surgeon Du Zuying are less clear cut.
Last month, Mr Mather was added to the list when he was quietly sentenced to one year's jail followed by deportation. He was convicted of assault after being found guilty of inflicting a knife injury on one of the intruders and injuring the finger of another when it was jammed in the door.
Evidence in her husband's favour never made it to court, Ms Xie said, while evidence against him was accepted but not available for scrutiny.
She said her husband's case was analogous to those of Mr Hu, Ms Chou, Mr Ng and Dr Zu except for one thing: her husband is not ethnically Chinese.
She said Mr Mather had been a ''star'' when he arrived in Nanjing a decade ago and the English teacher generously gave his time to throngs of eager students at ''English Corner'' near Nanjing University. But since the 2008 Beijing Olympics his foreign status had made him a target.
She said Mr Gao, who had tight links with police but poor relations with residents, had been urged to stand up to the foreigner as a way of demonstrating status.
''The prosecutor wanted to punish a Westerner to show that Chinese people have already stood up'' said Ms Xie, noting how he quoted Chairman Mao to that effect in his closing address.
Ms Xie said her family's ordeal should serve as a warning for the Australian business leaders who are heading to meet Ms Gillard's entourage at Bo'ao.
''If they want to get money out of business people they will do it and nothing can stop them,'' she said.
Gao Long, who led the intrusion into Mr Mather's apartment, declined to answer questions. ''Ask the prosecutor and judge,'' he said.
Tao Jiayong, who had pushed against Mr Mather's throat, said the court had told him to reject interview requests. If past events serve as a guide, the Bo'ao forum will feature lengthy paeans to Chinese success but little criticism.
James McGregor, a prominent adviser and author who has been observing business in China for 25 years, said the gap between executives' public demonstrations of fealty and on-the-ground experiences was explained by China's enormous opportunities for profit and its capacity for retribution.
''People I meet with are mostly very clear on the opportunities and the difficulties but when they're in public they only talk about opportunities,'' said Mr McGregor, author of One Billion Customers: Lessons from the Front Line of Doing Business in China.
''And I tell you, in private I've never seen the level of negativity towards China that there is right now in the business community,''he said.
■With Julia Gillard due in China on Friday, Australia's uncertain relationship with the regional superpower will come under renewed scrutiny. This is the first of a series examining the personal perils that impede closer business ties.

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Mar 30, 2013

Fair Work appointments 'flawed, disrespectful' | The Australian

FORMER ACTU secretary Jeff Lawrence is among eight new appointees to the Fair Work Commission that have sparked criticism from industry groups and the federal opposition.
Joe Catanzariti, a partner with law firm Clayton Utz, and Adam Hatcher SC, a barrister who has represented unions, were appointed as vice-presidents to the tribunal following the creation of the positions by Workplace Relations Minister Bill Shorten.
Workplace academics argue the decision to make the two new vice-presidents statutory positions gives them seniority over existing vice-presidents Graeme Watson and Michael Lawler, partner of union figure Kathy Jackson.
Mr Lawrence is among four new deputy presidents, while Nick Wilson, the Fair Work Ombudsman, and Leigh Johns, head of the Fair Work Building and Construction inspectorate, have been appointed commissioners.
Peter Anderson, chief executive of the Australian Chamber of Commerce and Industry, said: "That the government could not appoint one person of the eight from an active current role in industry or from amongst employer bodies is disrespectful to the private sector.
"The vice-presidency appointments, the most important, are the product of a flawed process in which the government effectively demoted office-holders two and three in the tribunal hierarchy and now appoints new lawyers over and above their heads. That unprincipled approach undermines the standing of the commission and industry confidence in it."
ACTU secretary Dave Oliver said Mr Lawrence would "bring an impartial and dedicated approach to the role, and is eminently qualified to serve on the workplace tribunal".
Opposition workplace relations spokesman Eric Abetz said Mr Lawrence's appointment showed Labor's "jobs-for-mates network is alive and well".

New Cyber Therapists Can Diagnose Depression Using Kinect

Going to a therapist in itself already makes a many people uncomfortable, but what if their wise and licensed confidant was actually just a fancy, upgraded Sim? Well, we may not have to wait too long to find out—a new computer program is already planning to be your depression-diagnosing assistant shrink.
The program, cleverly named SimSensei and developed by the University of Southern California's Institute for Creative Technologies, works by using Microsoft Kinect sensors to note subtle changes in body language and facial expression, aiding their human counterparts in recognizing signs of depression. And this is where the animated avatar actually trumps human therapists: current depression diagnoses depend on questionnaires, which completely leave out potentially telling non-verbal cues.
And what these cyber shrinks lack in humanity, they certainly try to make up for in bedside manner. As we see in the video, for example, after a brief uncomfortable silence, the patient mentions that he's from LA. What a coincidence! So is our young doctor friend. She "hmms," she's responsive, and most importantly, she cares. But the fact is that SimSensei is an aid—not a replacement, so you will be getting the full psychiatric experience, regardless.
Because as warm and caring as our robodoc sounds in the above video, that voice is unmistakably computer-based. It's hard to imagine that your body language won't be at leastsomewhat affected by the knowledge that, in reality, your essentially just talking to an empty room.[New Scientist via PopSci]

Australians must realise the future is not all about China

The traffic stopped at a red light, a man in a suit and tie darted off the side of the road and pointed a gun through a car window. ''Assault,'' my suddenly stricken taxi driver told me, alarmed by the scene in the right lane, before jerking ahead as the lights changed, leaving the besuited criminal to flee into the dark with his prize.
This was last week in Sao Paulo, headed to the airport in Brazil's largest city - the brazen robbery a reminder why, in the newly rich district where I'd been staying, three-metre steel bars surround every apartment block. Tempting as it is to see those bars as symbols of tough social problems still to overcome in South America's largest nation, they can also be interpreted another way: as a sign of Brazil's growing wealth.
Every country has crime - there was an attempted car-jacking in Sydney on Tuesday. Even if Brazil has a reputation of being more dangerous than most, what should not be overlooked is it now ranks as the world's sixth largest economy, and, in a few years time, is expected to overtake the wealth of France. The middle class in this nation of about 200 million has more and more to protect.
The rise of Brazil from backwater to global heavyweight is just one story that illustrates momentous change in the world. A lot of stale attitudes about the superiority of ''developed'' over ''developing'' countries still need to be shaken loose.
Australians have become accustomed in recent years to focusing on the transformation of China, the millions lifted out of poverty amid social shifts on the scale of 19th century Europe's industrial revolution. Julia Gillard is expected in Beijing next month for her second trip as Prime Minister, which will serve to reinforce China's central importance to the modern Australian story.
Talk of an ''Asian Century'' is the present fashion, meant as an acknowledgement that the centre of political gravity is shifting to this neighbourhood. But there is a risk if this is only seen as a China story. As foreign affairs academic Michael Wesley put it in a speech in Canberra this week, ''Australia needs to stop chopping up Asia into the bits that are most important to us, and forgetting about the rest.''
This logic could be extended: Australia should not emphasise Asia at the expense of broader changes in the world. It is worth remembering Gillard was also in Brazil last June. Then she went to Russia in September, and in October, to India.
Together with China, these make up the BRIC countries - a snappy acronym christened in a business report to describe ''emerging economies'' but since adopted, with South Africa added to the mix, as the title for a fairly informal annual gathering of each country's leaders.
Search through the travel diary of past Australian prime ministers and you would be hard pressed to find he had visited each of these four countries inside a year. The standard homage to London, Washington, and in more recent decades, Jakarta, is far more familiar.
Gillard's recent travel is another signal of the remarkable shift in global power, and while Australians are better equipped than many to grasp the scale of this change, figuring out how to approach this new world still needs work.
Take Russia for example, a fallen superpower ruled by kleptocrats squandering its wealth as the world's largest producer of oil. Vladimir Putin spent $18 billion ($18 billion!) hosting an Asia-Pacific summit last year in Vladivostok.
Yet despite its massive problems with corruption, by luck of geography Russia is a land bridge stretching east to west from Asia to Europe. The prospect, distant though it may be, of Chinese freight one day being sent from Vladivostok to the massive Dutch port of Rotterdam - not by ship but by train across a Siberian tundra warmed by climate change - has tremendous implications for global power.
If China can reach the European market by land, on trains that run much faster than the ships through the already crowded Suez Canal, the US is suddenly out of the equation as the self-appointed custodian of global shipping lanes. Some of Asia's ''strategic claustrophobia'', in Wesley's apt phrase, begins to dissipate and the leverage of the mighty American navy is suddenly lessened.
Whether this scenario plays out or not, this is the kind of radical transformation Australia must expect to confront in the years ahead, consequences stemming not only from the spread of wealth but of new co-operation between countries previously too poor or ill-disposed to work together.
The BRICS leaders met in Durban this week, promising to pool their foreign reserves to offer big loans to poor nations and rival the Western-dominated World Bank and the International Monetary Fund. Think of this as the international equivalent of breaking the monopoly of the big banks here in Australia, and the prospect of a rapid waning of Western influence starts to become apparent.
Talk of the BRICS as a united force is readily dismissed in diplomatic circles - and not only in the West. The startling differences between the countries is usually cited as a reason they will never co-operate closely. Democratic Brazil has suffered similar discomfort to Australia in dealing with authoritarian China, particularly in minerals and agriculture. India and China fought a war in living memory. Maybe it is true they will never be close. But it would be a mistake to ignore their co-operation altogether.
During my trip to Sao Paulo - sponsored by the University of Melbourne, for a conference of delegates from Australia and Brazil - a hint of official concern crept into the talks. The implications of emerging economies excluding the West and, in turn, the West closing ranks, is clearly on people's minds. This is especially centred on the Group of 20 meeting, or G20, the forum Australia so proudly boasts as its ticket to global influence.
Also taking part in the conference at Sao Paulo was an Australian official, Gordon de Brouwer, who has the delightful title in the Prime Minister's Department of ''G20 Sherpa''. His job is as wry as it sounds - de Brouwer leads Julia Gillard to the ''summit'' and steers her around the pitfalls and obstacles.
The BRICS are each members of the G20 and de Brouwer offered a striking warning about the danger of ''stage-managed'' and ''brittle'' diplomacy taking over the gathering. If the BRICS make decisions among themselves and present an entrenched view to the wider summit, the G20 would lose what was seen as its strength in the global financial crisis: a flexible attitude among key leaders to decide on a uniform course of action.
It is not only the BRICS - an older grouping, the G7, stubbornly lives on, a forum from which countries such as Australia are excluded. De Brouwer warned this division of G20 members into sub-groups only reinforced the old north-south divide.
Australia is anxious not to be left out as new global power structures take shape. Yet that is a choice others will ultimately make. This is not to say we are a nation without influence, but charting a course in this world of change will involve a lot more responsiveness than declaration. And that means choosing friends. Australia might be smaller, but it actually shares many attributes with countries such as Brazil and South Africa, an economy built on rich natural endowments.
So here is one for the puzzle pages: what word can you make by adding an ''A'' to BRICS?

Mar 29, 2013

Yeshivah probe broadens

Victoria's Human Rights Commission will investigate a complaint by Zephaniah Waks, the father of Jewish abuse victim advocate Manny Waks, that he has been shunned by the Orthodox Jewish community in Melbourne because of his son's anti-abuse campaign.
Mr Waks snr says that since the police began investigating child sexual abuse complaints around Melbourne's Yeshivah Centre nearly two years ago, he has suffered an escalating campaign of ''innuendo, lies, vilification, victimisation and discrimination''.
The case, which is shocking in a community that prefers to sort out disputes internally, names Yeshivah Centre spiritual head Zvi Telsner and its committee head Hershel Herbst as respondents.
Mr Waks said on Thursday he had tried to resolve issues internally and through Jewish courts, but the Yeshivah leadership refused, so he had gained permission under Jewish law to go to the secular courts from a leading American rabbi, Yosef Blau from Yeshiva University.
He has been a member of the Yeshivah community for 27 years, but has strongly supported his son. He says he has been denied religious honours in the synagogue, ''viciously attacked'' on the internet and has lost friends because of his support for abuse victims.
''Whatever happens, I am going to be a leper in the community. I know three perpetrators [of sexual abuse] who are walking free today, and they will do so unless the leadership attitude changes. People are afraid to come forward, and you can see why,'' Mr Waks said.
He said the Yeshivah Centre leadership called him a ''moser'', someone who informs on Jews to secular authorities.
Rabbi Telsner declined to comment on Thursday, while the Yeshivah Centre did not answer calls.
Manny Waks, himself a victim and founder of the Tzedek victims' advocacy group, said he was proud of his father for standing up to intimidation and bullying - ''this outrageous behaviour by individuals who refer to themselves as religious, including the head rabbi of the Yeshivah Centre''.
''It would have been much easier to heed the advice of some and to simply leave that synagogue. But why should he? He's been a member there for almost 30 years and has done absolutely nothing wrong. Also, if he would simply walk away, it would provide legitimacy for these bullies,'' he said.
Both Zephaniah and Manny Waks appeared before the Victorian inquiry into how the churches and other groups handled sex abuse complaints, but their evidence remains suppressed.

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Mar 28, 2013

Huge cyberattack slows the 'net | The Australian

A RECORD breaking cyberattack targeting an anti-spam watchdog group on a scale never seen before has sent ripples of fear across the internet.
Spamhaus, a site responsible for keeping ads for counterfeit Viagra and bogus weight-loss pills out of the world's inboxes, said it had been buffeted by the monster denial-of-service attack since mid-March, apparently from groups angry at being blacklisted by the Swiss-British group.

"It is a small miracle that we're still online," Spamhaus researcher Vincent Hanna said.

Denial-of-service attacks overwhelm a server with traffic - like hundreds of letters being jammed through a mail slot at the same time. Security experts measure those attacks in bits of data per second.

Recent cyberattacks - like the ones that caused persistent outages at US banking sites late last year, have tended to peak at 100 billion bits per second.

But the furious assault on Spamhaus has shattered the charts, clocking in at 300 billion bits per second, according to San Francisco-based CloudFlare, which Spamhaus has enlisted to help it weather the attack.

"It was likely quite a bit more, but at some point measurement systems can't keep up," CloudFlare chief executive Matthew Prince wrote in an email.

Patrick Gilmore of Akamai Technologies said that was no understatement.

"This attack is the largest that has been publicly disclosed - ever - in the history of the internet," he said.

It's unclear who exactly was behind the attack, although a man who identified himself as Sven Olaf Kamphuis said he was in touch with the attackers and described them as mainly consisting of disgruntled Russian internet service providers who had found themselves on Spamhaus' blacklists. There was no immediate way to verify his claim.

He accused the watchdog of arbitrarily blocking content that it did not like. Spamhaus has widely used and constantly updated blacklists of sites that send spam.

"They abuse their position not to stop spam but to exercise censorship without a court order," Kamphuis said.

Gilmore and Prince said the attack's perpetrators had taken advantage of weaknesses in the internet's infrastructure to trick thousands of servers into routing a torrent of junk traffic to Spamhaus every second.

The trick, called "DNS reflection", works a little bit like mailing requests for information to thousands of different organizations with a target's return address written across the back of the envelopes.

When all the organizations reply at once, they send a landslide of useless data to the unwitting addressee.

Both experts said the attack's sheer size has sent ripples of disruptions across the internet as servers moved mountains of junk traffic back and forth across the Web.

"At a minimum there would have been slowness", Prince said, adding in a blog post that "if the internet felt a bit more sluggish for you over the last few days in Europe, this may be part of the reason why."

At the London internet Exchange, where service providers exchange traffic across the globe, spokesman Malcolm Hutty said his organization had seen "a minor degree of congestion in a small portion of the network".

But he said it was unlikely that any ordinary users had been affected by the attack.

Hanna said his site had so far managed to stay online, but warned that being knocked off the internet could give spammers an opening to step up their mailings - which may mean more fake lottery announcements and pitches for penny stocks heading to people's inboxes.

Hanna denied claims that his organization had behaved arbitrarily, noting that his group would lose its credibility if it started flagging benign content as spam.

"We have 1.7 billion people who watch over our shoulder," he said. "If we start blocking emails that they want, they will obviously stop using us."

Gilmore of Akamai was also dismissive of the claim that Spamhaus was biased.

"Spamhaus' reputation is sterling," he said.

Mar 25, 2013

How life of spy Ben Zygier unravelled

It was after 8pm when warders on duty at the Ayalon prison in Ramla, an inland town south-east of Tel Aviv, realised that Zygier hadn't been spotted in his cell for more than an hour. Monitored by three surveillance cameras, the supposedly suicide-proof cell in wing 15 was originally built to house Yigal Amir, the right-wing fanatic who assassinated then Israeli Prime Minister Yitzhak Rabin in 1995.

Divided into two parts, the cell's larger area contains a bed, a sitting area and a kitchenette, while the smaller section is a washroom equipped with a shower and toilet.
When the guards finally entered the cell at 8.19pm, they found Zygier's body hanging cold and lifeless.

"Our job is to isolate him, not to keep him alive", said one of the guards who attended the scene.
Even to his prison guards Zygier was known only as "Prisoner X"; his prison cell contained no name, no photo, no legal charges. Thanks to a court-ordered ban on any reporting of Zygier's case by the Israeli media, and his parents' determination to keep their son's death a private affair, only fragmentary details had leaked out.
Aired in public for the first time by the ABC's Foreign Correspondent program last month, the circumstances surrounding his death have remained so mysterious that at least one member of Israel's parliament went so far as to suggest that Zygier had been murdered.
But now, after a months' long investigation it can be revealed for the first time that Zygier – unintentionally – crossed a line that no agent before him had ever crossed.
This investigation began with a phone call to Fairfax Media's Jerusalem bureau in October 2009, and was concluded by a team of reporters assembled by Germany's Der Spiegel magazine.
It involved extensive research conducted in Israel, Lebanon, Italy, Britain and Australia, plus interviews with former friends, business partners, employees of several intelligence agencies and governments, as well as with Zygier himself shortly before his arrest.
This is the story of the tragic downfall of a passionate Zionist, a young man who had so aspired to a life of heroism, and yet, in the wake of his own shortcomings, willingly gave away such sensitive information to the enemy that it represents one of the most serious security breaches in Israel's 65-year history.
Growing up in Melbourne's south-eastern suburbs, Ben Zygier enjoyed the happiest of upbringings. His father, Geoffrey, ran the family muesli company before selling the business and taking on a number of senior roles within Melbourne's Jewish community, including a stint as chief executive of the Jewish Community Council of Victoria.
Educated at the King David School, and later at Bialik College, Zygier joined the left-wing Zionist youth movement Hashomer Hatzair. After high school, Zygier began a law degree at Monash University before announcing to family and friends that he was taking some time out to live in Israel, where he ended up at Kibbutz Gazit.
About 500 people currently live at Kibbutz Gazit – which is in the north of the country, in the hills surrounding the Sea of Galilee close to Israel's border with Lebanon – and they include 40-year-old Daniel Leiton, a tall, strong-looking man with big hands and a thick Australian accent.
"Ben was an amazing man," says Leiton, who describes Zygier as one of his best friends. “Cheerful, friendly, warm."
Leiton recalls meeting Zygier for the first time in Melbourne in the late 1980s. Even then, says Leiton, the two teenagers shared a passionate belief in Zionism, with Ben already making it clear that he would make Aliyah, the act of immigration for diaspora Jews to the land of Israel. The last time Leiton saw Zygier was in Melbourne, early in the 2010 new year, only weeks before Zygier was arrested.
Asked if he noticed Zygier behaving strangely, or whether he seemed tense or anxious, Leiton says no. "He was, as always."
Unable to imagine his friend locked up in solitary confinement in the high-security Ayalon prison, even less that he was a Mossad agent, Leiton still finds it difficult to comprehend the fact of Zygier's suicide. "Unbelievable," he murmurs.
Another friend of Zygier's was Lior Brand, who shared a living space with both Zygier and Leiton at Kibbutz Gazit, and who describes Zygier as "obviously clever, and ready to defend Israel against its enemies, no matter what the cost".
After living at Kibbutz Gazit, and formally taking Israeli citizenship under the adopted Hebrew name of Ben Alon, Zygier flitted back and forth between Israel and Australia, in turn completing his law degree at Monash, and completing his military service in Israel.
In this tiny strip of a nation surrounded only by countries either overtly or surreptitiously hostile to its existence, one agency in particular stands ready to accept such people into its ranks: the Institute for Intelligence and Special Operations, known the world over by the Hebrew word for "institute" as the Mossad.
Engaged in a furious shadow war against its enemies, Mossad's most recent exploits include the car-bomb assassination of Hezbollah commander Imad Mughniyeh in 2008, the January 2010 killing of Hamas operative Mahmoud Al-Mabhouh and at least five Iranian nuclear scientists in Dubai.
Always on the look out for Israel's best and brightest talent, at the beginning of the last decade Mossad began its first-ever public recruitment drive complete with advertisements promoting "the job of a lifetime".
“The Mossad is open – not for everyone, but for a few. Maybe for you," said the tagline.
The advertisements caught Zygier's eye, and he responded to the Gmail address provided at the bottom of one of the ads.
For an agency like Mossad, which depends on its ability to send its agents unsuspected behind enemy lines, foreign-born nationals like Zygier offer an inherently valuable bonus – access to a genuine foreign passport that bears no connection to Israel.
At the beginning of 2003, after he had completed an article clerkship at the Melbourne offices of corporate law-firm Deacons (now Norton Rose), Zygier took a leave of absence and moved to Tel Aviv, where he won a trainee position at the prestigious Tel Aviv law firm of Herzog, Fox & Ne'eman.
In fact, by this time Zygier was already being screened by Mossad and hopefully awaiting news that his application would be successful.
As part of that screening process, candidates are interviewed by psychologists who are looking for obvious flaws or personality traits that might disqualify them from a career in a clandestine intelligence service.
"We're looking for mentally stable people," says one Israeli psychiatrist who is familiar with the recruitment process.
By December 2003, Zygier had received the good news he was hoping for, and was formally accepted to undergo an intense year-long training program that included mastering such techniques as how to falsify resum├ęs and other documents, as well as how to manipulate people.
By early 2005 he was ready for his first mission. He was sent to Europe, where he was instructed to infiltrate companies that had business relationships with countries including Iran and Syria.
One company Zygier had contact with was a hi-tech firm in Milan, Italy. Despite initial information provided to Fairfax Media that this company might be a front company owned and operated by Mossad, subsequent investigations have determined conclusively that this is not the case.
According to Israeli intelligence sources, Zygier also chased other opportunities in Eastern Europe and the Balkans.
One chief executive of a mid-sized European company with extensive business interests across the Middle East and Persian Gulf – including Iran – confirmed that he had hired Zygier for an accounting position.
The CEO described Zygier as being "extremely sharp", and said that while it became obvious that Zygier was not trained in accounting despite his claims, he nevertheless managed to master the requisite skills quickly.
But, having mastered the job and usually being able to finish a full day's work by as early as 11am, Zygier then started to lose interest in his regular work duties.
Because of Zygier's evident talent, a decision was then made to reassign him to another role within the company that focused on customer relations.
A similar pattern repeated itself. Zygier initially thrived in the new role, but then began to lose interest to the extent that it started to adversely affect customer relations.
The CEO said Zygier began behaving rashly with clients, finally causing one major client to sever its links with his company.
Despite his intelligence, the CEO said Zygier displayed a lack of commitment to the tasks he was assigned to within his company.
"So, we had to let him go," he said.
When confronted with the news that Zygier was actually a full-time employee of Mossad, the CEO said he had struggled to process the news that his company – a legitimate concern that he had built largely on his own – would have been targeted by Israeli intelligence.
The CEO said that while his company had significant business interests across the Middle East, Zygier never travelled as part of his job and had no face-to-face contact with clients.
He said that never at any stage during the 18 months that he employed Zygier were any suspicions raised that Zygier was the clandestine figure he later proved to be.
He said he also remained unsure what advantage, if any, Zygier would have been able to gain on behalf of Israel while working for his company.
By mid 2007, Zygier had, in the eyes of his superiors, performed without much success. He couldn't deliver, at least not enough of what Mossad wanted, so a decision was made to bring a reluctant Zygier back from the field to a desk job.
He was "neither particularly bad nor particularly good, but mediocre," says an Israeli source familiar with Zygier's case.
Inside Mossad's hexagonal headquarters off Tel Aviv's highway No.5, the agency is divided into three main sections.
Keshet, which means rainbow in Hebrew, is the first section, and is responsible for surveillance and other forms of covert intelligence gathering.
The Caesarea department, which is named after the nearby ancient Roman settlement, is home to Mossad strike force, the men and women who prepare and execute attacks abroad.
The largest section is called Tsomet, which is the Hebrew word for crossroads, a more bureaucratic, less glamorous section that deals mainly with the evaluation and analysis of the information coming in.
For someone like Zygier, this must have been a blow to his self-esteem, with former Mossad insiders describing the work for Tsomet as bureaucratic, complete with routines and supervision that an agent can break free from when working abroad.
Over recent decades, say Mossad insiders, organisational changes within Tsomet have meant that the once strictly segregated, smaller units have been merged into larger teams, with the information being handled across the section becoming more visible to the people working there.
Yet, as subsequent events indicated, this concept of transparency within had a fundamental flaw: giving Tsomet employees like Zygier access to so much information actually makes them vulnerable to betrayal.
During the early hours of Saturday, May 16, 2009, Lebanese special forces stormed the house of Ziad al-Homsi in the village of Saadnayel in the western Bekaa Valley, dragging the startled 61-year-old from his bed.
According to the arrest warrant, Homsi was accused of being an Israeli spy. The warrant even stated his Mossad codename: The Indian.
The arrest came as a shock to many Lebanese, not just because Homsi had been the mayor of his town for years. He was also treated as a war hero, because he had fought against Israel on the side of the Palestine Liberation Organisation and the Syrian army during the Lebanese civil war.
But, as his friends and family were to soon learn, Homsi had been recruited to work as a spy for Israel since 2006, receiving  about $US100,000 for his services.
Leaked details from Homsi's interrogation underscore how important he was to Mossad, with Homsi revealing that he had told his Israeli handlers that he could lead them to Hassan Nasrallah, the leader of Israel's mortal enemy, Hezbollah, who has lived in hiding for years, paving the way for another assassination.
The indictment against Homsi revealed the elaborate lengths to which Mossad went to recruit Homsi.
According to Homsi, a Chinese man named "David" had apparently come to his village in Lebanon, introducing himself to Homsi as an employee of the City of Beijing's foreign trade office, and claiming that he wanted to establish business ties in Lebanon.
At a meeting in Lebanon, "David" invited Homsi to Beijing to attend a trade fair, telling him that the invitation had come directly from the Chinese government. Homsi enjoyed a successful visit to Beijing where he was promised a salary.
Later, he was invited to another meeting abroad, this time in Bangkok, but instead of business, the people on the other side of the table started asking Homsi what he knew about three Israeli soldiers who had been missing since a 1982 battle that Homsi himself had fought in on the side of the Arabs.
"This is the moment at which the defendant becomes aware that he is dealing with Israelis, who work for the Mossad and have nothing to do with import-export companies or services that search for missing people," reads the Homsi indictment.
Homsi agreed to work for Mossad who provided him with a computer and a doctored USB flash drive, as well as a device that looked like a stereo system but was in fact a transmitter for sending messages, all of which were seized after his arrest.
Homsi, says General Ashraf Rifi, the head of Lebanese intelligence, was one of the most important catches his agency had ever made. Homsi was later sentenced to 15 years in prison with hard labor.
The spring of 2009 was a busy time for Lebanese intelligence, who managed to crack open several Israeli spy rings.
Another of those arrested was Mustafa Ali Awadeh, code name "Zuzi," another important mole within Hezbollah.
For the Israelis, it was the biggest intelligence setback in the Levant in decades. Officials at Mossad headquarters were baffled. How did the Lebanese manage to track down these men?
An even greater stir was created at Mossad headquarters when it received a tip that there had been talk within Hezbollah about a Mossad agent who was currently in Australia, who may be in some danger. It was soon clear that the agent had to be Ben Zygier.
Zygier, frustrated by his desk job, had requested leave of absence to do a masters of management at Monash University. The Mossad personnel department approved the request and by the beginning of 2009, Zygier had enrolled under the name of Benjamin Allen and was back living in Melbourne.
He told a fellow student that he had worked for the PricewaterhouseCoopers management-consulting firm in Geneva, and that he occasionally had to return to Switzerland for the firm. It explained his many trips.
"Ben was obsessed with the notion of keeping fit," a former fellow student recalls. "He always ate well and paid attention to his health."
In October, 2009, Fairfax Media received a tip from an Australian source about three dual Australian-Israeli citizens who were suspected of working on behalf of Israeli intelligence, using their Australian identities as cover.
One of the names was that of Ben Zygier, but when Fairfax Media confronted Zygier with the allegations during December 2009 and January 2010, Zygier vociferously denied any such thing, dismissing the information as fanciful.
In early January, 2010, Zygier's Mossad superiors decided to call Zygier back to Tel Aviv, not because they yet suspected him of leaking information to the Lebanese, but out of concern for his safety stemming from the tip that Hezbollah appeared to know his identity.
Zygier's superiors had also received reports that Zygier had breached protocol by talking openly about the fact that he was a Mossad agent, and wanted to warn him to be more discreet.
It was not until Zygier was back in Israel, where it was thought that there was something odd about his behaviour, the suspicion arose that he might have had a role in the arrests in Lebanon.
By January 29, 2010, that suspicion was sufficient to order Israel's General Security Service, better known by its two-letter Hebrew abbreviation as the Shin Bet, arrested Zygier. The story they uncovered during the internal investigation that followed shocked them.
Zygier, apparently frustrated by his demotion to a desk job, had decided to take matters into his own hands and find a way to rehabilitate his reputation within the organisation.
Under intense questioning from the Shin Bet, Zygier broke down and admitted that sometime in 2008, before he took his leave of absence and moved to Australia, he had flown to eastern Europe to meet with a man he knew to have close links with Hezbollah with the intention of turning that person into a double agent.
Instead, the man reported the recruitment attempt to Beirut, and himself began playing the same game as Zygier, except in reverse. Without Zygier's knowledge, the man was reporting every detail of his contact with Zygier back to the Hezbollah leadership in Beirut. Israeli officials believe that even Nasrallah himself was being kept informed.
The contact between Zygier and his Hezbollah-affiliated contact went on for months.
When the man asked Zygier for proof that he was a real Mossad agent, Zygier readily complied and began supplying him with real intelligence from Tel Aviv, including the names of Ziad al-Homsi and Mustafa Ali Awadeh, Mossad's two top informants in Lebanon.
Israeli officials with access to the investigation say that when Zygier was arrested, he was also found carrying a compact disc with additional classified information from the Tsomet department, which they believe he was also preparing to hand over to the other side.
At a meeting in Tel Aviv, earlier this month, a black limousine with darkened windows drove into a public parking lot, bringing a reporter to a meeting with an Israeli government official. "Zygier wanted to achieve something that he didn't end up getting," says the official, who is familiar with the investigation.
"And then he ended up on a precipitous path. He crossed paths with someone who was much more professional than he was."
At some point, he says, Zygier crossed a red line and went to the dark side. His fate, the official points out, was largely a matter of psychology.
Israeli informants have certainly changed sides in the past. But a regular Mossad employee has never done what Zygier did. It is a bitter defeat for Mossad, but for Hezbollah it is one of the rare instances in which an Arab intelligence service prevailed over its Jewish counterpart.
Zygier's actions are also a heavy blow to Mossad because they raise doubts as to the integrity of the agency's own people – and the manner in which it recruits employees.
Lior Brand, one of Zygier's friends from Kibbutz Gazit, believes that Zygier simply wasn't up to the task. The lies, the silence and the loneliness were too much for him, says Brand, adding that Mossad "made a big mistake" by recruiting him.
He says that he will never forgive Mossad for recruiting the wrong person.
Negotiations over Zygier's sentence were conducted behind the scenes in December 2010.
Mossad and Shin Bet wanted to set an example and demanded that the traitor spend at least 10 years in prison. While he was in prison, in the summer of 2010, Zygier's second daughter was born, and the family was permitted to visit him occasionally.
What truly motivated Zygier? Was it wounded pride? Vanity? A lack of professionalism? Perhaps his parents could answer these questions, but they have chosen to remain silent. What can be ruled out conclusively is that money played no role.
After Israeli security officials had released Zygier's body, the family invited his closest friends to the funeral, including Daniel Leiton from Kibbutz Gazit.
Leiton went to the cemetery and asked why Zygier had to die, but he didn't receive an answer. "No one talked about why, at 34, he suddenly died."
Leiton says that while he still loves Israel, something went terribly wrong in this case.
The inscription engraved on Zygier's polished black tombstone in a cemetery in Springvale reads: "Blessed be the judge of truth."

Mar 24, 2013

Forecasting Fox -

In 2006, Philip E. Tetlock published a landmark book called “Expert Political Judgment.” While his findings obviously don’t apply to me, Tetlock demonstrated that pundits and experts are terrible at making predictions.
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But Tetlock is also interested in how people can get better at making forecasts. His subsequent work helped prompt people at one of the government’s most creative agencies, the Intelligence Advanced Research Projects Agency, to hold a forecasting tournament to see if competition could spur better predictions.
In the fall of 2011, the agency asked a series of short-term questions about foreign affairs, such as whether certain countries will leave the euro, whether North Korea will re-enter arms talks, or whether Vladimir Putin and Dmitri Medvedev would switch jobs. They hired a consulting firm to run an experimental control group against which the competitors could be benchmarked.
Five teams entered the tournament, from places like M.I.T., Michigan and Maryland. Tetlock and his wife, the decision scientist Barbara Mellers, helped form a Penn/Berkeley team, which bested the competition and surpassed the benchmarks by 60 percent in Year 1.
How did they make such accurate predictions? In the first place, they identified better forecasters. It turns out you can give people tests that usefully measure how open-minded they are.
For example, if you spent $1.10 on a baseball glove and a ball, and the glove cost $1 more than the ball, how much did the ball cost? Most people want to say that the glove cost $1 and the ball 10 cents. But some people doubt their original answer and realize the ball actually costs 5 cents.
Tetlock and company gathered 3,000 participants. Some got put into teams with training, some got put into teams without. Some worked alone. Some worked in prediction markets. Some did probabilistic thinking and some did more narrative thinking. The teams with training that engaged in probabilistic thinking performed best. The training involved learning some of the lessons included in Daniel Kahneman’s great work, “Thinking, Fast and Slow.” For example, they were taught to alternate between taking the inside view and the outside view.
Suppose you’re asked to predict whether the government of Egypt will fall. You can try to learn everything you can about Egypt. That’s the inside view. Or you can ask about the category. Of all Middle Eastern authoritarian governments, what percentage fall in a given year? That outside view is essential.
Most important, participants were taught to turn hunches into probabilities. Then they had online discussions with members of their team adjusting the probabilities, as often as every day. People in the discussions wanted to avoid the embarrassment of being proved wrong.
In these discussions, hedgehogs disappeared and foxes prospered. That is, having grand theories about, say, the nature of modern China was not useful. Being able to look at a narrow question from many vantage points and quickly readjust the probabilities was tremendously useful. The Penn/Berkeley team also came up with an algorithm to weigh the best performers. Let’s say the top three forecasters all believe that the chances that Italy will stay in the euro zone are 0.7 (with 1 being a certainty it will and 0 being a certainty it won’t). If those three forecasters arrive at their judgments using different information and analysis, then the algorithm synthesizes their combined judgment into a 0.9. It makes the collective judgment more extreme.
This algorithm has been extremely good at predicting results. Tetlock has tried to use his own intuition to beat the algorithm but hasn’t succeeded.
In the second year of the tournament, Tetlock and collaborators skimmed off the top 2 percent of forecasters across experimental conditions, identifying 60 top performers and randomly assigning them into five teams of 12 each. These “super forecasters” also delivered a far-above-average performance in Year 2. Apparently, forecasting skill cannot only be taught, it can be replicated.
Tetlock is now recruiting for Year 3. (You can match wits against the world by He believes that this kind of process may help depolarize politics. If you take Republicans and Democrats and ask them to make a series of narrow predictions, they’ll have to put aside their grand notions and think clearly about the imminently falsifiable.
If I were President Obama or John Kerry, I’d want the Penn/Berkeley predictions on my desk. The intelligence communities may hate it. High-status old vets have nothing to gain and much to lose by having their analysis measured against a bunch of outsiders. But this sort of work could probably help policy makers better anticipate what’s around the corner. It might induce them to think more probabilistically. It might make them better foxes.

Iceland Baffled by Chinese Plan for Golf Resort -

Struggling to stand upright against a howling wind, Bragi Benediktsson looked out over his family’s land — a barren expanse of snow and ice that a Chinese billionaire wants to turn into a golf course — and laughed. “Golf here is difficult,” said Mr. Benediktsson, a 75-year-old sheep farmer.
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An airstrip close to Grimsstadir, a village in northeastern Iceland. 
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In Grimsstadir, snow often falls from September to May.
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Mr. Benediktsson located Grimsstadir on a map. Even for Icelanders used to harsh weather, Grimsstadir is a desolate spot.
Ilvy Njiokiktjien for The New York Times
“Golf here is difficult,” said Mr. Benediktsson, who is 75. He has been seesawing on whether to sell his land, but is mindful of his age. “When the hotel goes up, I’ll be down in the ground.”
It was 11 a.m., and a pale sun had only just crawled sluggishly into the sky. The snow, which began falling in September, will probably continue until May. Even for Icelanders accustomed to harsh weather and isolation, Grimsstadir is a particularly desolate spot.
But thanks to a poetry-loving Chinese tycoon with a thing for snow, it has become the setting for a bizarre Icelandic saga featuring geopolitical intrigue, tens of millions of dollars and a swarm of dark conspiracy theories. At the center of the drama is Huang Nubo, a former official in the Chinese Communist Party’s Propaganda Department who, now a property developer in Beijing, wants to build a luxury hotel and an “eco golf course” for wealthy Chinese seeking clean air and solitude.
“It never seemed a very convincing business plan,” said Iceland’s interior minister, Ogmundur Jonasson, who last year rejected a request that Mr. Huang be exempted from Icelandic laws that restrict foreign ownership of land. “I put many questions and got no answers,” the minister added.
Prodded by diplomats from the United States and other countries to take a hard look at Mr. Huang’s intentions, Mr. Jonasson questioned what might lie behind China’s curious interest in Grimsstadir. “One has to look at this from a geopolitical perspective and ask about motivations,” Mr. Jonasson said.
Rebuffed in an initial attempt to buy a vast area of wilderness covering more than 100 square miles, Mr. Huang’s Beijing-based company, the Zhongkun Group, is now pushing for a long-term lease arrangement instead — and counting on the prospect that elections in Iceland next month will lead to a new, and perhaps more welcoming, government.
The current government in Reykjavik, a left-of-center coalition, has mostly given Mr. Huang the cold shoulder. Even ministers who favor Chinese investment wonder what is really going on.
Foreign Minister Ossur Skarphedinsson said that he saw no reason to block Mr. Huang’s hotel venture, which is expected to cost more than $100 million, but that he was puzzled by Mr. Huang’s desire to build a high-end resort in a place so isolated that “you can almost hear ghosts dancing in the snow.” As for playing golf, Mr. Skarphedinsson added, “that doesn’t seem very sensible.”
Such bafflement has stirred much speculation about what the Chinese tycoon and perhaps the Chinese authorities are up to. A proposal by the Zhongkun Group to renovate a small landing strip in the Grimsstadir area and buy 10 aircraft led to anxious talk of a Chinese air base. The area’s relative proximity to deep fjords on Iceland’s northeast coast near offshore oil reserves fueled speculation about a Chinese push for a naval facility and access to the Arctic’s bountiful supplies of natural resources. Far-fetched rumors about Chinese missiles and listening posts led to worries about military personnel pouring in disguised as hoteliers and golf caddies.
Mr. Huang could not be reached for comment: he was off climbing a mountain, his company said. In response to written questions, Xu Hong, a vice president at the company, dismissed speculation of a military purpose or other ulterior motives as “the guesswork of post-cold-war thinking.” Ms. Xu said Grimsstadir had been chosen because “there is market demand in China” for peace and quiet. “Most Chinese now don’t like to travel to dirty, noisy places,” she said.
Mr. Skarphedinsson scoffed at a widely held belief here that Mr. Huang is leading a plot by Beijing to secure a strategic foothold in Iceland, a NATO member that is entirely bereft of military muscle. Iceland also sits astride what will become important shipping lanes as ice-choked Arctic waters warm.
China has openly declared its interest in shipping routes through the Arctic and in using Iceland as a future transport hub, Mr. Skarphedinsson said. But these goals, he added, have been hurt, not helped, by the cloud of suspicion generated by Mr. Huang.
“One thing the Chinese Communist Party never failed at since Mao is public relations, but the P.R. in this venture has failed miserably,” Iceland’s foreign minister said.
Beijing’s keen interest in Iceland, nearby Greenland and the wider Arctic region is well known. China is negotiating a Free Trade Area accord with Reykjavik, its first with a European nation, and last year it sent its prime minister at the time, Wen Jiabao, for a two-day visit. A Chinese icebreaker, the Snow Dragon, stopped off last year as part of a push by Beijing to gain entry as an observer to the Arctic Council, a body comprising the United States, Canada, Russia, Iceland and Nordic states in or near Arctic waters.
China has also opened what, physically at least, is the biggest foreign embassy by far in Reykjavik, even though it has only seven accredited diplomats.
“Nobody knows what the devil they are up to,” said Einar Benediktsson, Iceland’s former ambassador to Washington and a critic of his country’s expanding ties with Beijing. “All we know is that it is very important to China to get a foothold in the Arctic, and Iceland is an easy prey.”
Mr. Huang’s enthusiasm for Iceland at first stirred little concern. Nobody paid much attention when, in 2010, he suddenly popped up in Reykjavik to renew a long-dormant friendship with Hjorleifur Sveinbjornsson, a translator of Chinese literature he had roomed with at Peking University in the 1970s.
Mr. Sveinbjornsson doubts his old roommate is part of an elaborate gambit by China. “If we had not shared a room he would never have even heard of Iceland,” he said. He is not sure that Grimsstadir will work as a resort: “It is not the first place I would have chosen.” But, noting that Mr. Huang “is not an idiot,” Mr. Sveinbjornsson said that “maybe it takes somebody from the outside to see the potential.”
During his first trip to Iceland in 2010, Mr. Huang made no mention of any business plans but focused instead on poetry, announcing that he would put up $1 million to establish and finance the China-Iceland Cultural Fund. Led by his former roommate, the fund has since organized two meetings of poets, the first in Reykjavik in 2010, the second a year later in Beijing.
A third planned in Norway for last year was scrapped after Mr. Huang’s company declared Norway unacceptable as a site. Mr. Sveinbjornsson said no reason had been given, but he linked the move to Beijing’s continuing fury at Norway over the 2010 Nobel Peace Prize, awarded in Oslo, which went to Liu Xiaobo, a jailed dissident Chinese writer.
Less than a year after his first visit, Mr. Huang returned to Iceland and offered Mr. Benediktsson, the sheep farmer, $7 million for his land and that of some relatives and a second family. A business plan submitted later to the government by the Zhongkun Group said “the location fitted perfectly with our strategic plans for developing environmentally friendly eco resorts in remote locations.” The company said it would build a 100-room five-star resort hotel, luxury villas and the golf course.
While exotic golf courses are all the rage now, this one seemed to many here a long shot. “I’ve looked at this very closely and gone through all the documents, and I’m just aghast,” said Edward Huijbens, director of the Icelandic Tourism Research Center in Akureyri, the main town in northern Iceland. “The whole project is fundamentally not credible.”
But Mr. Huang’s business strategy has apparently impressed the state-owned China Development Bank, which, according to the Zhongkun Group, last year reached a “cooperation agreement” with the company worth about $800 million. Ms. Xu, Zhongkun’s vice president, said the Chinese bank “will provide loans and financial support to concrete projects by Zhongkun, including, but not exclusively, in Iceland.”
There is now talk that some local mayors will buy the Grimsstadir land — with money provided by Zhongkun — and then lease a portion of it to Mr. Huang, but Mr. Jonasson, the interior minister who refused to give a green light to Mr. Huang’s plans last year, is still suspicious.
“There are so many loose ends,” the minister said. Changing a purchase into a lease does not change the fact that the hotel-golf complex “makes very little sense,” he added. Mr. Jonasson said Mr. Huang “is not just a simple poet wanting to find peace of mind in the mountains of Iceland.”
Mr. Benediktsonn, the sheep farmer, has been swinging back and forth on whether he wants to sell his property. He does not like the idea that the area would be flooded with Chinese tourists and golf carts, but doubts that the resort will ever materialize, and, mindful of his own advanced age, calculates that if it does he will not be around. “When the hotel goes up, I’ll be down in the ground,” he said