Friday 28 August 2015

Weekly Wrap Up: The end of the affair?

In April, Abchat discussed infamous dating website Ashley Madison’s parent company Avid Life Media’s (ALM) decision to go public in Europe, rather than America, because of Europe’s supposedly more tolerant attitude towards adultery. But now this somewhat dubious claim may never be tested, as Ashley Madison battles the repercussions of a hacking of their system by ‘The Impact Team’. A data breach of this size, where 37 million user records were stolen, is in itself a public relations catastrophe. But a company’s response is the key to minimising damage, and ALM’s response has been nothing short of disastrous.

There was a somewhat promising initial reaction, where ALM Chief Executive Noel Biderman confirmed to Brian Krebs of Krebs on Security that the hack had happened, but that the company was “working diligently and feverishly” to remove the data. And it seems they were successful - within 30 minutes of Krebs talking to Biderman, several of the links no longer worked.

But with the information already hacked, ALM couldn’t prevent the inevitable. On 15 August the Ashley Madison database was leaked. However, instead of working to mitigate the damage, or at the very least apologising, Raja Bhatia, Ashley Madison’s original founding Chief Technology Officer, did what you might expect a cheating spouse to do: he initially denied the authenticity of the database, stating that it must be false because it contained credit card details, which he claimed Ashley Madison did not have records of. So when clients confirmed the database did in fact contain their details, it left Ashley Madison in an awkward public situation – one which many of their users might now be familiar with.

Avid Life has now been forced to act, but their efforts, including offering their paid-delete service to clients for free, and a reward of $500,000 for intelligence on who may be responsible, are ‘too little, too late’. Investment bankers have already said the Company can “kiss its IPO plans good-bye”. The stolen information will likely have repercussions for clients beyond the financial; jobs, family and reputation could all be lost, and it seems unlikely that the Ashley Madison brand will be able to recover from such a devastating breach of client confidentiality. Ironically, it seems that Avid Life media is about to find out that broken trust can make it impossible to repair (client) relationships.

This week, Abchurch hosted a market lunch, where topics such as the Chinese stock market volatility, crowd funding as a source of finance and the current IPO market were discussed.

The week, Mirabaud Asset Management appointed Ken Nicholson to manage European small cap and mid cap equity portfolios. Nomura Asset Management appointed Andreas Koerner as head of marketing and client relations for Europe, the Middle East and Africa. Edison Investment Research appointed Anna Bossong as UK technology, media and telecoms analyst.

“The Impact Team” – A group (or possibly an individual) apparently created for the sole purpose of hacking Ashley Madison.

This Bank Holiday weekend, there are a plethora of events on in London, with something to suit everyone.

Of course, those prepared to brave the inevitable crowds will be heading to Notting Hill Carnival, which is celebrating 50 years with the theme ‘Emergence of Carnival’. It is running from 10am to 8:30pm on Sunday and Monday, with the former intended as ‘A Family Day’ and the latter ‘The Grand Finale’.

If you fancy motoring through the weekend in style, you might like to check out the Bond in Motion Exhibition taking place at the London Film Museum in Covent Garden. It is the largest display of its kind ever staged in London.

For the foodies, on Saturday, The Urban Food Fest is taking over a Shoreditch Car park. Sample dishes brought to you from all four corners of the globe and wash them down with craft beer, cider, wine, champagne or a cocktail (or two).

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