Send in the Clones To Boost News Items

I use Twitter to disseminate our research and help inform the community on areas such as cryptography, security and Blockchain. But I noticed that I had tweeted something to do with an Ether give-away:

I was worried that I had clicked on a news item related to Blockchain, and it has sent the wrong item, but I noticed that the reply from me, with my picture and name, but from another account. So watch out for those pesky bots who create fake profiles that look real, and then get lots of likes:

Fake news

If there's one thing that motives people, it is money, so anything that dealers can do to have an edge will often make them money. So if they can pick up a rumour of a change in the operation of a company, they can either bail-in or bail-out of the stock.

For good news (for them), such as a take-over, they will bail-in, and cash-out when it is announced, and for bad news (such as a drop in sales), they bail-out before the announcement, and then buy back when the stock is lower. These are the basic laws that has driven the stock exchange for decades. Unfortunately, in a world of Big Data and targeted spear phishing, we could be seeing the signs of a crack in the news feeds. With this we have increased volume of news fragments (V for Volume), along with problems related to the trustworthiness of sources (V for Veracity), and any noise in the system could lead of bad effects.

Big Data and Automated Agents

In the past dealers have used respected sources, such as the Financial Times, to get their information, and where sources of take-overs were checked, but in an era of Big Data, the news feeds are often automated, and "noise" can easily get into the system, especially it the noise has been primed to cause a disruption. It has now been seen to be affecting the stock market, with a glitch just yesterday in Twitter's share price... the rumour was that they were getting bought-out ... "buy Twitter shares asap" ... was the cry!

With Big Data we get the four V's of:

• V(olume) - the amount of information that is now gathered in real-time is massive.
• V(eracity) - the trustworthiness of sources can be a problem, especially in trigger rumours.
• V(ariery) - this is the different forms of information such as from new items, social media, video feeds, and son.
• V(elocity) - the speed of information of the Internet very increases, and it is a major challenge to process the amount of relevant information, in order to make sense of it.

With stock market manipulation, it is not too difficult to trick the systems to force information into the processing agents, or use targeted spear phishing email to dealers. As we can see in Figure crawling agents read fragments of data from blogs, social media, and Web sites, and then these are processed using NLP - Natural Language Processing - to make sense of them, and then clustered to give their significant, and bind them together. These are then fed to the stock market analysts/dealers to make sense of whether the event is significant for the prices of the shares. For example, an earthquake in Japan had a significant effect the supply of electronic components to a range of customers, all of which can affect the stock price.

Figure 1: News fragment gathering

One problem that we have is that a malicious person can feed the crawling agents with incorrect information (or misguided information), and these can be picked up by the agents. Along with this, the scammer can feed the information onto other sites in order to boost its credibility (Figure 2).

On the Internet, if enough sources say it is true, then it becomes a fact! For example, a story of a woman with a third breast implant received nearly 200,000 shares, but actually it related to a three-breast prosthesis found in her luggage. 

Figure 2: A rumour spreads!

Along with the risk of incorrect processing of news items, phishing emails can be used to trick analysts (Figure 3). In this case we see that the URL is fake, but the content looks valid, as the scammer has used all the graphics and style from the proper site.

Figure 3: The World is Flat! - note this is a fake page!

Twitter boost

Questions have now been asked about the spike of Twitter's shares on Tuesday 14 July 2015 (Figure 1), and which related to a false report of a buy-out. The stock surged by 8%, and ended-up up 2.6%. Something wasn't quite right in the claims, and it has since been traced to a hoax, where the news item appeared to be from Bloomberg News, but it has an incorrect URL.

Basically it was like a phishing email, where the email sent spoofs the content from a site in the email. In this case the page had been mocked-up like the Bloomberg site, and tricked Internet agents into thinking the content could be trusted. With automated agents then started to push it onto other sites, and each one boosting the credibility.

The spike mirror another suspicious active around Avon, Tower Group and Rocky Mountain Chocolate. 

Avon, Tower Group, and Rocky Mountain Chocolate

The same trace of spoofing news articles happened with a spike in Avon Products Inc. where Nedko Nedev tricked the stock market with a fake news story of a take-over. It is also alleged that he did it for Tower Group International Ltd. and Rocky Mountain Chocolate Factory Inc. where he purchased shares in companies, and leaked a fake story about take-overs.

On 14 May 2015, Avon saw stock volumes rise to over 21 million the day before, and to nearly 70 million (448% increase in volume), with a 20% surge in the price. The news item itself was full of typos, and lots of misinformation and bore all the signs of a scam, but the rumour spread quickly, and few people had time to trace its source.

On 13 May 2014, Euroins Insurance Group announced that it was going to purchase Tower Group, with an increase in shares of 32%, and where Nedev earned over $23,368 on the share spike. Before this, on 28 Dec 2012, PST Capital announced a take-over of Rocky Mountain Chocolate, and which saw shares leap 23%.

It must be said that there were official documents submitted for the take-overs, but they were unlikely to be real.

Conclusions

With so much information arriving on the Internet every day, and so much of it being automated in its gathering, it is not too difficult for someone to create false rumour. With many looking to catch the latest news before everyone else, the demand for fast processing of new fragments will increase, and analysts will be looking at minutes, if not seconds, in terms of the delay between an event happening and it appearing on their screen. With margins to be made by quick response, it may be that they will not have enough time to check the credibility of this, and cause some serious problems, as the stock market governs our modern economy, and its failure could cause many problems.

Do you know ...

The Earth is flat!

It is, because it says it here ...