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Inside the turmoil at Sobeys-owned stores after ransomware attack – CBC.ca

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Employees of Empire Co., the parent company of Sobeys, have begun to speak out about the turmoil unfolding inside the grocery chain since a ransomware attack began plaguing its computer systems earlier this month.

Workers from across the country say some stores have run short of items because orders cannot be placed as usual, while at others, food that had gone bad initially either piled up or was frozen because it couldn’t be removed from the inventory system.

Pharmacies were unable to fill new prescriptions for a week, customers cannot redeem loyalty points or use gift cards, and staff were concerned last week they wouldn’t get paid because the payroll system is down.

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“It’s basically been a mess.… The word that can best describe it — just a mess,” said one employee who works in the front end at a Safeway in western Canada.

The CBC has agreed to protect the identities of employees it has spoken to, as they are worried they’ll be fired if the company knows they shared internal information.

Ransom messages on computers

Empire announced in a news release Nov. 7 that an “information technology systems issue” was disrupting some services, including filling prescriptions at pharmacies. The company did not respond to questions from the CBC last week, but said in a statement Nov. 11 its pharmacies were once again fully operational, though stores were still experiencing challenges.

The company owns 1,500 stores across Canada, including Sobeys, Lawtons, IGA, Safeway, Foodland, Needs and other grocery outlets.

Several cybersecurity experts have said they suspect the company’s systems were hacked, and a ransomware attack — when hackers lock computer systems until money is paid — could be to blame.

The employees who spoke with the CBC said ransomware was indeed the cause of the problem.

“Somebody higher up got an email and basically clicked a link they weren’t supposed to,” said the front-end Safeway employee. “I don’t know the exact dollar figure, but I know it was like millions, like several millions.”

The troubles began overnight Thursday, Nov. 3 into Friday, Nov. 4.

When employees arrived for work on Friday, their computers took longer than usual to boot up, and when they finally did, “nothing came up other than this big white block in the middle of the screen that said ransomware, please comply before proceeding, or something like that,” said a worker in a meat and seafood department at a Safeway store.

“I saw the word ransom and that scared me right away.”

Orders at the whim of warehouses

Employees were told not to log in, to unplug certain digital scales, and not to use the scanning equipment that allows them to track inventory.

Without the computer systems and handheld scanners, called Telxon guns, stores have not been able to place orders, so in some cases, they have run out of certain items.

After the first day or so of the outage, warehouses began to send products to stores based on what they had available and estimates of what they may need.

A display case at a Sobeys store sits empty.
A display case at Sobeys sits empty on Nov. 14, more than a week after a ransomware attack affected computer systems at the chain. Employees say the IT issue has affected their ability to bring in some items. (CBC)

“It’s hit and miss what the warehouse is going to send us,” said one employee. “So we’re getting all kinds of weird stuff that we haven’t seen in decades.”

Some stores have not received any orders of a certain product, while others have, so employees from one store have driven over to pick up the needed items from another.

At some stores, staff have been writing out price signs by hand because the system they usually use is not available.

“When we finally get our system back, everything’s going to be so out of whack because nothing is being scanned,” said an employee.

Scheduling and payroll

The computer issues have also disrupted Empire’s ability to maintain its usual scheduling and payroll systems.

“I literally went into work and there was like a schedule written down on a piece of paper and I’m like, what is this?” said a worker.

Some employees are being asked to write down their hours in a logbook.

Employees in the chain are paid every other week, and some were told last week they would not get paid last Thursday, their scheduled payday.

However, workers later told the CBC the company found a workaround: since the first week of the two-week pay period occurred before the ransomware attack, employees would receive the same amount of pay for the second week, even if they did not work the same number of hours. Each employee also received an extra $100 on Thursday to compensate for any extra hours they may have worked the second week.

Once the payroll system is functioning again, any worker who was overpaid will be expected to return overpayments.

Impacts on customers

Many customers are likely unaware of the difficulties employees are dealing with. But some impacts have been clear.

On the first day of the outage, some self-checkout machines weren’t working.

“The lineups at the tills, because people aren’t used to that and we pump a lot of people through these self checkouts — so, a lot of pissed-off customers over that,” said a Safeway worker.

A handwritten sign shows the price of seedless grapes.
Employees say some signs at Empire-owned stores are handwritten because they are unable to use some computer systems due to a ransomware attack. (CBC)

Customers have been unable to use gift cards or redeem Scene loyalty points, and stores have been unable to process Western Union transfers — causing frustration for some, one employee said. 

The company has not officially told employees the cause of the outage. They have been instructed to simply tell customers it’s an IT issue.

“You kind of feel bad having to like just you know, water it down, what’s really going on, to customers,” said an employee. “You feel like you’re deceiving everybody because there’s more going on behind the doors than what they’re trying to make it out to be.”

Food security concern

Sylvain Charlebois, the director of Dalhousie University’s Agri-Food Analytics Lab, said he has noticed a lot of empty shelves at Sobeys-owned stores since the computer issue began.

But so far, Canadians do not seem to be particularly concerned about the issue, he said. 

“If it gets worse, maybe at some point people will realize how significant a ransomware hitting the food industry can be,” he said. “This is the No. 2 grocer in the country dealing with cyber terrorism. That’s a big deal.”

Portrait of smiling man in suit and tie
Sylvain Charlebois is the director of the Agri-Food Analytics Lab at Dalhousie University in Halifax. (Submitted by Sylvain Charlebois)

He said the hack is worrisome from a privacy perspective, because the company holds personal data through credit and debit cards, loyalty programs and pharmacy prescriptions.

But the disruption is also significant from a food-security perspective. The food retail industry is a high-volume, low-margin sector, so a significant hit from a ransomware attack could bring an entire company down, Charlebois said.

That would mean part of the food distribution system could be disabled, and food prices would likely increase, at least temporarily.

“I have faith in the food industry. They would recalibrate and restart and things like that. But it would take a while,” Charlebois said.

“Cybersecurity is a huge vulnerability for our supply chains for sure, especially when it comes to food. You’re always a ransomware away from seeing food access becoming an issue in Canada.”

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FTX founder Bankman-Fried objects to tighter bail, says prosecutors 'sandbagged' him – Reuters

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NEW YORK, Jan 28 (Reuters) – Lawyers for Sam Bankman-Fried on Saturday urged a U.S. judge not to ban the indicted FTX cryptocurrency executive from communicating with former colleagues as part of his bail, saying prosecutors “sandbagged” the process to put their client in the “worst possible light.”

The lawyers were responding to a Friday night request by federal prosecutors that Bankman-Fried not be allowed to talk with most employees of FTX or his Alameda Research hedge fund without lawyers present, or use the encrypted messaging apps Signal or Slack and potentially delete messages automatically.

Bankman-Fried, 30, has been free on $250 million bond since pleading not guilty to charges of fraud in the looting of billions of dollars from the now-bankrupt FTX.

Prosecutors said their request was in response to Bankman-Fried’s recent effort to contact a potential witness against him, the general counsel of an FTX affiliate, and was needed to prevent witness tampering and other obstruction of justice.

But in a letter to U.S. District Judge Lewis Kaplan in Manhattan, Bankman-Fried’s lawyers said prosecutors sprung the “overbroad” bail conditions without revealing that both sides had been discussing bail over the last week.

“Rather than wait for any response from the defense, the government sandbagged the process, filing this letter at 6:00 p.m. on Friday evening,” Bankman-Fried’s lawyers wrote. “The government apparently believes that a one-sided presentation – spun to put our client in the worst possible light – is the best way to get the outcome it seeks.”

Bankman-Fried’s lawyers also said their client’s efforts to contact the general counsel and John Ray, installed as FTX’s chief executive during the bankruptcy, were attempts to offer “assistance” and not to interfere.

A spokesman for U.S. Attorney Damian Williams in Manhattan declined to comment.

Bankman-Fried’s lawyers proposed that their client have access to some colleagues, including his therapist, but not be allowed to talk with Caroline Ellison and Zixiao “Gary” Wang, who have pleaded guilty and are cooperating with prosecutors.

They said a Signal ban isn’t necessary because Bankman-Fried is not using the auto-delete feature, and concern he might is “unfounded.”

The lawyers also asked to remove a bail condition preventing Bankman-Fried from accessing FTX, Alameda or cryptocurrency assets, saying there was “no evidence” he was responsible for earlier alleged unauthorized transactions.

In an order on Saturday, Kaplan gave prosecutors until Monday to address Bankman-Fried’s concerns.

“The court expects all counsel to abstain from pejorative characterizations of the actions and motives of their adversaries,” the judge added.

Reporting by Jonathan Stempel in New York; Editing by Andrea Ricci

Our Standards: The Thomson Reuters Trust Principles.

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Gold declines in light of the report that revealed inflation continues to decline – Kitco NEWS

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As of 6:00 PM EST, the February contract of gold futures has fallen for the second time in the last seven trading days. Currently, gold futures are fixed at $1927.60, a decline of $2.40 or 0.12%. Gold traded to a high of $1935.40, and a low of $1916.50.

The key takeaway from today’s PCE inflation index report was that the core PCA index declined in December by 0.3%. The preferred inflation index used by the Federal Reserve was at 4.7% year-over-year in November and declined to 4.4% year-over-year last month.

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Both reports will influence decisions made by the Fed at next week’s FOMC meeting.

They will be critical components used by the Federal Reserve next week and will most likely strengthen the conviction of hawkish Fed officials to maintain their extremely aggressive monetary policy. Currently, the Federal Reserve’s forward guidance is composed of additional rate hikes and maintaining elevated rates for a longer time.

The most likely outcome is that the Fed will raise the rate by ¼% at the next two meetings. The Federal Reserve has stated they continue to work to reach its inflation target of 2%. A vast majority of market participants continue to believe that the Fed will backpedal on its commitment to keep rates elevated through 2023.

I will be speaking at the VRIC 2023 (Sunday, January 29-30) at the Vancouver Convention Center. Both Kitco News and I wish to welcome you if you’re available.

For those who would like more information simply use this link.

Wishing you as always good trading,

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Afraid to check a bag? Canada's missing baggage woes explained – CBC News

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Deborah Cleary was exasperated.

When she landed in Montreal on Dec. 19, following a trip to Italy, she discovered her suitcase was missing. More than a month later, Air Canada still hadn’t found her bag. 

“I’ve spent so much time thinking about it, worrying about it, checking online, calling Air Canada,” said Cleary from her home in Plattsburg, N.Y., on Tuesday. “I’m just sort of desperate to get my bag back.”

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The post-pandemic return to travel has been turbulent, plagued by mass flight disruptions and missing baggage piling up at airports. That has led to calls for airlines to improve their baggage delivery systems.

“It’s broken, so I think they need to fix that,” said Cleary, who visited the Montreal airport two weeks ago to search for her bag amidst a sea of unclaimed luggage. She didn’t find it.

However, following a CBC News inquiry to Air Canada, Cleary learned on Friday that her suitcase is being shipped to her home. 

“I’m very, very happy,” she said. “I had almost resigned myself, I was never going to see it again.”

Deborah Cleary and Dan Albert of Plattsburgh, NY pose for photo during their vacation to Italy.
Deborah Cleary and Dan Albert of Plattsburgh, N.Y., are still waiting to be reunited with their missing baggage that disappeared on their return flight from Milan to Montreal. (submitted by Deborah Cleary)

Canada’s first round of missing baggage chaos erupted in the summer, largely sparked by staffing shortages as airports and airlines scrambled to ramp up operations. 

There were high hopes the holiday travel season would go more smoothly — until severe winter storms hit much of Canada, causing hundreds of delayed and cancelled flights, plus a backlog of lost luggage.

“In the airline industry, a delay of greater than 15 minutes generally results in missed connections,” said former Air Canada executive Duncan Dee. “Delays equal missing bags.”

Former Air Canada executive, Duncan Dee.
Former Air Canada executive Duncan Dee says airports need more infastrucutre funding to keep operations running smoothly during bad weather. (CBC)

Dee said airlines need to do a better job keeping track of luggage, and the federal government also needs to invest more in airports.

In late December, cold weather caused a baggage belt to freeze at Toronto’s international airport; a fierce snow storm caused widespread flight delays and cancellations at Vancouver’s international airport.

“There’s obviously a need for better infrastructure, better resources for airports … to make them more resilient to these weather events,” said Dee.

What about the airlines?

When asked this week about recent travel chaos, Transport Minister Omar Alghabra said airports will get the tools they need, but did not elaborate. 

On the baggage issue, he pointed the finger at airlines. 

“I find it extremely frustrating when I hear stories of people not having their luggage for days on end,” he said during an event in Hamilton. “Airlines should be doing more.”

His comments follow several recent media reports about air passengers’ struggles to find their missing luggage

They include the saga of Nakita Rees and Tom Wilson of Cambridge, Ont., who battled with Air Canada for more than four months to retrieve Wilson’s missing suitcase. 

WATCH |Ontario couple told their luggage was lost — but it wasn’t: 

Air Canada said this couple’s luggage was lost. AirTags showed otherwise

5 days ago

Duration 2:18

A couple says Air Canada donated their luggage to charity just a month after it got lost en route to Toronto’s Pearson Airport. They tracked it to a storage locker.

The bag vanished during their flight home from Greece in September. Because the couple had put an air tag tracker inside the suitcase, they were able to track its journey to a storage facility in nearby Etobicoke, Ont. 

Even though Rees shared with Air Canada the whereabouts of the bag, the airline deemed it lost. 

“The most frustrating thing about it was we had no way of getting it, even though we knew the location and we told the airline so many times,” said Rees. “Because the air tags are newer, I just don’t think airlines know how to even use that information.”

The couple finally got the suitcase back this week — after their story was picked up by the media.

Airlines respond

Other passengers have also complained about similar experiences when tracking their lost luggage with air tags. 

Former Air Canada executive Dee said airlines typically track luggage by scanning their baggage tags and that their systems currently can’t accommodate air tracking technology.

“That’s something where airline processes have not caught up to the technology that’s available,” he said. “No airline in the world has the ability right now to accept information from travellers.”

Alghabra suggested airlines need to change with the times. 

“We hear about how Amazon is able to identify where their items [are at] every moment,” he said. “It’s frustrating that airlines still have not modernized their luggage handling system.”

Air Canada told CBC News it’s constantly exploring new technologies. The airline added that its baggage delivery rate has returned to normal, following the stormy holiday weather. 

Air Canada said that in Rees’ case, the baggage tag had fallen off the suitcase. The airline didn’t say how it eventually located the couple’s bag, but did indicate that they get to keep the $2,300 in compensation they received for lost luggage. 

WestJet said it has launched a strategic review to fine-tune its baggage systems. “[We] are committed to working together with our third-party service partners … to ensure we improve in this area,” said spokesperson Madison Kruger in an email. 

Baggage compensation

Travellers can claim up to approximately $2,350 for luggage that is lost or delayed on an international flight. For delayed baggage on domestic flights, the airlines design their own rules. 

Alghabra’s office told CBC News this week the government is exploring ways to strengthen rights for air passengers, including for delayed and lost baggage.

As for passenger Cleary, she had applied for compensation for a lost bag, but said getting it back is a better outcome. 

“I would much prefer to have my bag back than any money from Air Canada.”

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