Martin Flanagan: Betfair and authorities played their cards badly

IT’S A novel take on transparency at a publicly listed company. Online gambling firm Betfair yesterday admitted it had not informed customers that their credit card details were stolen in a big cyberspace attack 18 months ago.

More than three million gamblers’ account names with encrypted security questions, a similar number of usernames and nearly 90,000 account usernames with bank details were stolen in the attack by the cybercriminals, possibly operating from Cambodia.

Betfair’s defence for the secrecy blanket surrounding the episode is that its security measures made the stolen data unusable for fraudulent activity and it was able to recover the data intact.

In addition, the company said it contacted all the relevant authorities, including the UK’s Serious Organised Crime Agency. One inference, though unconfirmed, is that Soca felt Betfair’s customers were protected and publication of the cyber attack may have hindered criminal investigations.

Finally, Betfair reckons it has subsequently implemented all the recommendations from the independent reports it commissioned following the episode “and have done everything we can to minimise the risk of this happening again”.

It received one of the key reports just a month before it decided to float on the stock market last year. There was a mention of security breaches in the flotation prospecus.

And yet … there seems a strange mix of the Orwellian and not wanting to rock the stock market boat, on the part of the authorities, and Betfair basically agreeing to keep the magnitude of these “security breaches” under wraps.

They felt customers were safe from financial loss, and police hearts might have been in the right place in wanting to apprehend criminals, rather than alert them. But heads were not in the right place.

Investors deserved to be kept in the loop, let the heavens fall. It was a bad call.

Worrying pace of North Sea production retreat

IT IS just the sort of news that Britain’s cash‑strapped coffers did not need. Oil production from our own cash cow, the North Sea, has fallen 16 per cent in the second quarter of the year. It is currently a bit of a mystery, but what is clearly worrying is that the decline is the biggest since records began 16 years ago. The hit to the Treasury in lost taxes will be hefty.

The worst fall, about 25 per cent, was in gas produced from the southern section of the North Sea.This is perhaps unsurprising as it is the main area where operators have claimed rigs may have to be mothballed or shut down because of the controversial rise in government taxes on the industry in the last budget. This has added millions of pounds to the tax bills of large energy producers.

A more typical decline in North Sea gas production in a year has been close to 15 per cent, so it is a meaningful slump. Does it have implications for Britain’s longer‑term energy security?

The government is playing down the bald figures, saying the sharp decline in production from Britain’s silver‑veined watery backyard is due to maintenance and other production issues.

Adding some credence to this, the Health and Safety Executive has warned that only about one in 30 of the UK’s North Sea oil rigs is in good nick.

Even so, the decline over and above the general long-term trend of declining output off Britain’s east coast has rattled Oil & Gas, the industry pressure group. It wants analysis to be done of the reasons for a sudden decline of this magnitude, citing both the potential impact on the UK economy and our energy security.

Helios held as collateral

AGAINST the backdrop of Britain’s warmest late‑September since the 19th century a decent internet joke doing the rounds in City dealing rooms, in the form of a letter to debt‑submerged Greece as the eurozone bailout saga trundles on:

“Dear Greece, you can have your weather back when you pay your bills. Signed, Britain.”