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She was mistakenly transferred $10.5m – so she bought a mansion

A costly bungle has resulted in two Aussie women going on a spending spree and a cryptocurrency company left $10.5 million ($NZD 11.76 million) out of pocket. Thevamanogari Manivel received the hefty injection of cash after Crypto.com, one of the world’s largest cryptocurrency trading platforms, attempted to process a refund of just $100 ($NZD 111) in May last year. But, instead of sending through the refund, an account number was entered in the payment section, resulting in the accidental transfer. Seven months later, the company has launched legal action against Ms Manivel and her sister, Thilagavathy Gangadory, after discovering the error during an audit in December, per court documents. The only issue is that the sisters have already spent a chunk of the cash. The court found that Ms Manivel transferred the funds into a joint account last year, before taking out some of the money to buy a $1.35 million ($NZD 1.51 million) property in the Melbourne suburb of Craigieburn in February 2022. It’s understood that Ms Manivel bought the five-bedroom home - which reportedly includes a gym and home cinema - as a gift for her sister. The home, which sold on February 3 according to property records, is described as having a “monochrome palette”, four “designer” bathrooms, an outdoor entertaining area and an expansive kitchen/dining/family area with a butler’s pantry, per <a href="https://www.realestate.com.au/sold/property-house-vic-craigieburn-138330146">the listing</a>, According to the <a href="https://www.heraldsun.com.au/news/victoria/cryptocom-goes-to-court-to-recoup-105m-it-incorrectly-sent-to-melbourne-woman/news-story/1e2d91d007d1257593cf5d0d99f1477d" target="_blank" rel="noopener">Herald Sun</a>, Ms Manivel sent $430,000 ($NZD 481,000) to her daughter and transferred the ownership of the home to her sister, Ms Gangadory. Crypto.com has since won part of its legal battle after a judge in Victoria’s Supreme Court ordered that the luxury home be sold and that the $1.35 million be returned to the company, along with $27,369 ($NZD 30,644) in interest and other costs. It is believed that separate orders have been made for the remaining sum. Because Ms Gangadory failed to appear in court for the May hearing, Justice James Dudley Elliott said that “the allegations in the statement of claim are taken to be admitted”, after the reasons for his judgement were made <a href="http://publicly" target="_blank" rel="noopener">publicly available</a> last week. If Ms Gangadory doesn’t put the property on the market, a receiver could be appointed to arrange its sale or, if she ignores the orders, she could be in contempt of court, as reported by <a href="https://7news.com.au/news/vic/cryptocurrency-platform-cryptocom-accidentally-transfers-105-million-to-melbourne-woman-c-8058203" target="_blank" rel="noopener">7News</a>. “There’s no doubt that if you saw that in your account you would know it shouldn’t be there, and the onus is actually on you to actually call the sender and to say look that shouldn’t have come into my account,” Justin Lawrence from Henderson and Ball Lawyers told the outlet. “If you’re withholding property of someone else you’re effectively holding property by deception, you’re not entitled to it, you need to give it back.” The case is scheduled to return to court in October. Images: Realestate.com.au/Getty Images

Real Estate

Turning sporting heroes into NFTs? Here’s how it works

<div>Last week, to the likely chagrin of many an Aussie cricket fan, Steve Smith became the latest public figure to hop on the NFT gravy-train, joining <a href="https://www.glorious.digital/" target="_blank" rel="noreferrer noopener">Glorious Digital</a>, a Kiwi-owned NFT studio and marketplace launched by former All Blacks rugby great Dan Carter.The deal will see Smith put his face and name up for sale as digital tokens, shilling this new form of online memorabilia for a hefty price tag. On Instagram Smith wrote, “I can’t wait to connect with you guys in new and innovative ways.” But what does ownership of a Steve Smith NFT actually mean?What are NFTs?NFTs, short for Non-Fungible Tokens, are units of data stored on a <a href="https://cosmosmagazine.com/technology/explainer-cryptocurrency/" target="_blank" rel="noreferrer noopener">blockchain</a>, which is a type of digital ledger that records ownership. In blockchain technology, the information about each transaction is recorded in a “block” which is broadcast to every computer or network in the system. The block contains data about the transaction and the identity of the blocks before and after it, so that all the blocks can be linked in a chain. This makes them completely secure, because blockchains are replicated across every computer linked to the network. If one user’s copy of the blockchain differs from the rest, then it’s clearly a fraud. “If nobody is in charge, then everyone is in charge,” said Mark Ferraretto, an IT legal specialist who spoke to Cosmos last year. “Blockchain reflects this by allowing anyone to become part of the blockchain.”Blockchains are most famously used to record cryptocurrency, but NFTs aren’t actually a cryptocurrency, though they work in a similar way and are often purchased using cryptocurrencies like Etherium.So, what’s the point of an NFT?Generally speaking, an NFT is a token of ownership. It gives its owner rights to a piece of digital media, like an artwork, photograph, GIF or meme. That’s why it’s been leapt upon by digital creatives as a new way to market their work. Some NFTs have famously made people absurdly rich. Last year, a piece of digital art by the artist Mike Winkelmann – professionally known as Beeple – <a href="https://www.theverge.com/2021/3/11/22325054/beeple-christies-nft-sale-cost-everydays-69-million" target="_blank" rel="noreferrer noopener">sold for US$69 million</a> through auction-house Christie’s. Paris Hilton, celebrity heiress, <a href="https://www.theguardian.com/artanddesign/2021/nov/06/how-nfts-non-fungible-tokens-are-shaking-up-the-art-world" target="_blank" rel="noreferrer noopener">owns more than 150 NFTs</a>, including a virtual Chihuahua preening on a marble pedestal designed as an ode to her deceased pet, and which she displays on screens around her house.But ownership of an NFT is a tricky concept. <a href="https://studiolegal.com.au/blog/nft-ownership/" target="_blank" rel="noreferrer noopener">NFTs have in-built smart contracts that specify the owner’s rights</a>. In some cases, owning an NFT might grant you exclusive rights to the art or media it encodes, but in many cases owning an NFT of an artwork only gives you the rights to the NFT itself, while the original artwork may well be freely available elsewhere, on the internet or in the real world. An artist can transfer the copyright of the work to the purchaser, but they may also retain the copyright. Which begs the question: what exactly is the point? Do NFTs have actual value? Like many economic products, an NFT’s value is exclusively tied to the fact that people perceive it to be valuable. Whether the value of any or all NFTs will hold depends on the power of the market. The <a href="https://www.marketwatch.com/story/prices-for-nfts-have-plunged-but-that-doesnt-mean-they-will-disappear-11619465199" target="_blank" rel="noreferrer noopener">average price of an NFT sank by 70%</a> between February and April last year, but some commentators ascribed that to the weeding out of “gimmicky” tokens. For some people, an NFT is a collectible, like an insanely expensive but less tangible football card. As for Steve Smith NFTs? Think of them as digital memorabilia, and play on.Image credits: Getty Images</div><div id="contributors">This article was originally published on <a href="https://cosmosmagazine.com/people/society/turning-sporting-heroes-nfts/" target="_blank" rel="noopener">cosmosmagazine.com</a> and was written by Amalyah Hart. </div>

Art

Overhaul of payments system to cover digital wallets, buy now pay later, cryptocurrency

Treasurer Josh Frydenberg will announce on Wednesday a comprehensive reform of regulations governing the payments system, to bring it up to date with innovations such as digital wallets and cryptocurrency. The government says without the changes – the biggest in 25 years – Australians businesses and consumers could increasingly be making transactions in spaces beyond the full reach of Australian law, where rules were determined by foreign governments and multinationals. It points out that in three decades payment methods have gone from cash to cheques, cheques to credit cards, credit cards to debit cards and now to “tap and go” via digital wallets on phones or watches. Around a decade ago, cryptocurrency was a concept. Currently, there are more than 220 million participants in the worldwide crypto market, including many in Australia. The planned reforms will centralise oversight of the payment system by ensuring government plays a greater leadership role. The treasurer will be given more power to intervene in certain circumstances. Consumer protection will be strengthened, and more competition and innovation will be promoted. The reform program will be in two phases. There will be consultations in the first half of next year on those that are most urgent and easy to implement. Consultations on the rest will be done by the end of the year. The government says the present one-size-fits-all licensing framework for payment service providers will be replaced graduated, risk-based regulatory requirements. There will be consideration of the feasibility of a retail central bank digital currency, and an examination of “de-banking” (where a bank declines to offer a service to a business or individual). Frydenberg says the comprehensive payments and crypto asset reform program would “firmly place Australia among a handful of lead countries in the world. "It is how we will capitalise on the opportunity for Australia to lead the world in this emerging and fast-growing area which has almost endless potential applications across the economy,” he says. “For businesses, these reforms will address the ambiguity that can exist about the regulatory and tax treatment of crypto assets and new payment methods. "In doing so, it will drive even more consumer interest, facilitate even more new entrants and enable even more innovation to take place. "For consumers, these changes will establish a regulatory framework to underpin their growing use of crypto assets and clarify the treatment of new payment methods.”<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/173331/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/michelle-grattan-20316">Michelle Grattan</a>, Professorial Fellow, <a href="https://theconversation.com/institutions/university-of-canberra-865">University of Canberra</a> This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/overhaul-of-payments-system-to-cover-digital-wallets-buy-now-pay-later-cryptocurrency-173331">original article</a>. Image: Shutterstock

Retirement Income

What consumers need to know about Facebook’s new cryptocurrency

Cryptocurrencies have become a global phenomenon in the past few years. Now Facebook is launching it’s own cryptocurrency, in association with Visa, MasterCard, Uber and others. The stated aim of <a href="https://libra.org/en-US/">Libra</a> is to “enable a simple global currency and financial infrastructure that empowers billions of people”. The announcement has sparked fears that Libra could be <a href="https://theconversation.com/facebooks-libra-plan-talk-of-the-demise-of-central-banks-is-greatly-exaggerated-119165">a threat to traditional banks</a>, warnings to be <a href="https://theconversation.com/libra-four-reasons-to-be-extremely-cautious-about-facebooks-new-currency-119123">cautious</a>, and <a href="https://theconversation.com/facebook-claims-libra-offers-economic-empowerment-to-billions-an-economist-is-skeptical-118982">sceptical commentary</a> of claims that it will help developing countries. But let’s go back to the basics and look at what Libra is, how it compares to other cryptocurrencies and whether you should be concerned about using it when it eventually arrives. What is a cryptocurrency? Currency is a system of money that is commonly used in exchange for goods and services and, as a result, holds value. Cryptocurrencies are digital currencies that are secured using cryptography. The more popular recent cryptocurrencies are based on blockchain technology which uses a cryptographic structure that is difficult to change. One of the key properties of this structure is a distributed ledger that keeps account of financial transactions, which anyone can access. What is Libra? Libra is a new currency that is being proposed by Facebook. It’s considered a cryptocurrency because cryptography will be used to help protect the value of the currency from tampering – such as double spending – and to protect the payment process. Libra has the potential to become successful because of the backing from the <a href="https://libra.org/en-US/association-council-principles/#overview">Libra Association</a>, which is made up of large international corporations such as Facebook, Uber and Vodafone. MasterCard and Visa have also thrown their hats in the ring, but no traditional banks are on the list. What’s different about Libra compared with other cryptocurrencies like Bitcoin? Cryptocurrencies like Bitcoin and Ethereum are quite egalitarian in nature. That’s because there is no single authority that verifies transactions between parties, so anyone could potentially do it. To authorise a Bitcoin transaction you would have to prove that you have done the work, known as a “<a href="https://en.bitcoin.it/wiki/Proof_of_work">proof of work</a>”. For Bitcoin, the proof of work is to solve a mathematical puzzle. People who successfully solve the puzzle (proving they have done some work), can add transactions to the blockchain distributed ledger and are rewarded with Bitcoins. The process is known as mining. The good thing about this is that it reduces fraud. Since anyone can potentially mine Bitcoins, it’s harder to collude as you wouldn’t know who the next person to mine a coin would be. And it’s simple to verify that the person is authorised because anyone can check that the puzzle has been solved correctly. Based on the <a href="https://mashable.com/article/facebook-libra-deep-dive/">initial descriptions of the currency</a>, it sounds like the difference with Libra is that it will verify transactions using a consensus system known as “<a href="https://blockgeeks.com/guides/proof-of-work-vs-proof-of-stake/">proof of stake</a>”, or a variation of this method. Under this system, transactions would be authorised by a group of people who have a stake or ownership in the currency. This makes it easier to predict who the next person to authorise a transaction might be (since there are a relatively small number of authorising group members), and then collude to launder funds without other group members knowing. It <a href="https://www.theblockcrypto.com/2019/06/18/how-to-become-a-founding-member-of-the-libra-association/">appears</a> the criteria to become a founding member of the Libra Association is to contribute a minimum of US$10 million entrance fee, have a large amount of money in the bank and be able to influence a large number of people. What are banks and regulators worried about? Cryptocurrencies affect governments and tax systems since they have little to no transaction costs when money is transferred across borders. So while the low transaction costs would be good for everyday users, the advent of a new cryptocurrency with a potentially very large user base has governments and traditional banks very concerned. While Libra is open source – meaning the source code is available for all to view, use and modify – it’s the members of the association who will be overseeing the currency. Libra could herald a shift away from traditional government taxes and banking fees to a new international monetary system controlled by corporate entities like Facebook and Uber. That’s a concern because of the lack of oversight from regulatory bodies. What should everyday people expect from Libra? The backing of software giants means it’s likely that the user interface for Libra coins would be smooth and simple to use. Low transaction costs would benefit users and the Libra Association promises to control the value of the currency so that it does not fluctuate as much as other cryptocurrencies. It’s unclear how they plan to do this. But value stability would be a great advantage in times of uncertainty. What are the risks? The everyday consumer probably wouldn’t know the difference between the “proof of work” and the “proof of stake” mechanisms. But since Facebook has a large database of users that are known to use Libra, it may be able to link Libra transactions to individuals. This could be a privacy concern. (Bitcoin transactions are anonymous because account numbers used in Bitcoin transactions are not linked to an individual’s identity.) Recent cybersecurity <a href="https://www.smh.com.au/business/banking-and-finance/australians-private-details-exposed-in-attack-on-westpac-s-payid-20190603-p51u2u.html">breaches</a> have contributed to a growing awareness of the vulnerabilities of IT systems. As with all software, the Libra implementation and management could be vulnerable to attack, which in turn could mean users could lose their money. But that is a risk that all cryptocurrency users face, whether they are aware of it or not. What steps could consumers take to protect themselves? No matter what cryptocurrency you choose to use, your funds are still accessible through the same interfaces: a web page or a mobile app. And the way you control access to your personal funds is by authenticating with a password. Make sure you keep your password safe by making sure it is complicated and hard to guess. Look for applications that allow you to use two-factor authentication and make sure it’s turned on. Libra is yet to prove its claims of making financial transactions safe and convenient. Only time will tell if its uptake will become widespread following its expected launch next year. Written by Ernest Foo. Republished with permission of <a rel="noopener" href="https://theconversation.com/the-lowdown-on-libra-what-consumers-need-to-know-about-facebooks-new-cryptocurrency-119391" target="_blank">The Conversation.</a>

Money & Banking

How I’m making a mint in retirement

A pensioner stands at an airport security checkpoint with a backpack full of gold bullion, a knife and false beard. Why? To understand that, you need to know a little about Palmerston North retiree Bruce Thompson and why he's so excited about "cryptocurrency". A former IT worker, and early adopter, Thompson has followed the rise of digital currency with avid interest. He's made $146,000 since he started dabbling with cryptocurrency in June 2016, $108,000 of that in the past month and a half. Cryptocurrencies are digital currencies that use encryption to secure transactions and control how new 'coins' are made. Bitcoin is the most famous, but there are others, such as Ehtereum and Dash. Each 'coin' has a unique computer-generated number, and only a limited amount can be created. They can be used anonymously. In mid-march, Thompson read about a major international bank buying Ethereum, and saw the currency's value start to tick upwards in the online exchanges. He realised it was about to skyrocket. So he made a snap decision to dip into another investment he'd made over the years – his gold bullion. That's how Thompson came to be standing at a checkpoint in Wellington Airport, with a bemused security guard giving him the side-eye. The problem was his gold was in a safe deposit box in the State Insurance building in Wellington, and the vault was closing in only three hours. He snatched up a backpack and dashed to the bus stop in Palmerston North, and arrived in the capital with an hour to spare. And he needed every bit of it to navigate the vault's tight security, so he sprinted three blocks through the crowded central Wellington streets. Soon he was back on the street with his backpack $103,000 in gold bars heavier, and was ready to fly to Auckland to cash it in. But in his rush to the vault, he'd never checked to see what else was in his backpack. The knife was from a hiking trip, and the fake beard was part of a costume for an amateur musical production. It took some explaining, but he was eventually on his way, minus the knife. "It was all a bit of a risk, but it has paid off hugely for me." Thompson said he wanted to share the wealth, so he made a starter's guide to buying cryptocurrencies to make it a bit easier for others to seize the opportunity. "When you make $140,000 basically overnight, you feel a bit guilty. "You think, how can this just be happening to me? I should tell everyone else." He said investing in cryptocurrency was a solid gamble, because it changed money and banking the same way digital technology was changing so many areas of life. Thompson said people shouldn't invest with money they couldn't afford to lose, and they should practise with $10 until they got a handle on the market. "I could be fatally wrong. But I've got enough put aside, I own my own house, and I'm a pensioner, so I'm all right." Could you see yourself doing something like this? Written by Paul Mitchell. First appeared on <a href="http://www.stuff.co.nz/" target="_blank">Stuff.co.nz</a>.

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