BREAKING: Eric Holder Recuses Himself From Leak Investigation
Katie Pavlich | May 14, 2013
Attorney General Eric Holder has recused himself from the Associated Press leak investigation. He will officially announce his recusal at a press conference Tuesday afternoon. Fox News is reporting his recusal comes partially because Holder has testified about potential national security leaks surrounding a May 7, 2012 Associated Press story.
Yesterday, the Associated Press revealed the Department of Justice had been secretly monitoring both the personal and work phones of numerous AP editors and reporters. DOJ responded to these revelations by releasing the following statement.
We take seriously our obligations to follow all applicable laws, federal regulations, and Department of Justice policies when issuing subpoenas for phone records of media organizations. Those regulations require us to make every reasonable effort to obtain information through alternative means before even considering a subpoena for the phone records of a member of the media. We must notify the media organization in advance unless doing so would pose a substantial threat to the integrity of the investigation. Because we value the freedom of the press, we are always careful and deliberative in seeking to strike the right balance between the public interest in the free flow of information and the public interest in the fair and effective administration of our criminal laws.://townhall.com/tipsheet/katiepavlich/2013/05/14/breaking-eric-holder-recuses-himself-from-leak-investigation-n1594600
Statistics: Posted by yoda — Tue May 14, 2013 10:57 am
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CRONY CAPITALISM – CHINESE STYLE4 commentsPosted on 26th October 2012 by Administrator in Economy |Politics |Social Issues
China, crony capitalism, debt, ruling elite
It is the same in every country on earth. There is no true free market capitalism. Every country is run by connected, powerful, rich, crony elites that suck their countries dry, while the average person is screwed over and pillaged through the extraction of taxes, the accumulation of debt on their backs, and the ravages of banker created inflation on their standard of living. The ruling elite reap all the ill-gotten benefits of their positions of power and you get fucked, over and over. This game has gone on for decades, but it has reached a tipping point. The people have been stripped to the bone and the issuance of debt has reached hyper-speed to try and sustain the unsustainable. There will be revolution, war, and chaos over the next 15 years. Count on it.
Billions in Hidden Riches for Family of Chinese Leader
By DAVID BARBOZA
BEIJING — The mother of China’s prime minister was a schoolteacher in northern China. His father was ordered to tend pigs in one of Mao’s political campaigns. And during childhood, “my family was extremely poor,” the prime minister, Wen Jiabao, said in a speech last year.
But now 90, the prime minister’s mother, Yang Zhiyun, not only left poverty behind — she became outright rich, at least on paper, according to corporate and regulatory records. Just one investment in her name, in a large Chinese financial services company, had a value of $120 million five years ago, the records show.
The details of how Ms. Yang, a widow, accumulated such wealth are not known, or even if she was aware of the holdings in her name. But it happened after her son was elevated to China’s ruling elite, first in 1998 as vice prime minister and then five years later as prime minister.
Many relatives of Wen Jiabao, including his son, daughter, younger brother and brother-in-law, have become extraordinarily wealthy during his leadership, an investigation by The New York Times shows. A review of corporate and regulatory records indicates that the prime minister’s relatives, some of whom have a knack for aggressive deal-making, including his wife, have controlled assets worth at least $2.7 billion.
In many cases, the names of the relatives have been hidden behind layers of partnerships and investment vehicles involving friends, work colleagues and business partners. Untangling their financial holdings provides an unusually detailed look at how politically connected people have profited from being at the intersection of government and business as state influence and private wealth converge in China’s fast-growing economy.
Unlike most new businesses in China, the family’s ventures sometimes received financial backing from state-owned companies, including China Mobile, one of the country’s biggest phone operators, the documents show. At other times, the ventures won support from some of Asia’s richest tycoons. The Times found that Mr. Wen’s relatives accumulated shares in banks, jewelers, tourist resorts, telecommunications companies and infrastructure projects, sometimes by using offshore entities.
The holdings include a villa development project in Beijing; a tire factory in northern China; a company that helped build some of Beijing’s Olympic stadiums, including the well-known “Bird’s Nest”; and Ping An Insurance, one of the world’s biggest financial services companies.
As prime minister in an economy that remains heavily state-driven, Mr. Wen, who is best known for his simple ways and common touch, more importantly has broad authority over the major industries where his relatives have made their fortunes. Chinese companies cannot list their shares on a stock exchange without approval from agencies overseen by Mr. Wen, for example. He also has the power to influence investments in strategic sectors like energy and telecommunications.
Because the Chinese government rarely makes its deliberations public, it is not known what role — if any — Mr. Wen, who is 70, has played in most policy or regulatory decisions. But in some cases, his relatives have sought to profit from opportunities made possible by those decisions.
The prime minister’s younger brother, for example, has a company that was awarded more than $30 million in government contracts and subsidies to handle wastewater treatment and medical waste disposal for some of China’s biggest cities, according to estimates based on government records. The contracts were announced after Mr. Wen ordered tougher regulations on medical waste disposal in 2003 after the SARS outbreak.
In 2004, after the State Council, a government body Mr. Wen presides over, exempted Ping An Insurance and other companies from rules that limited their scope, Ping An went on to raise $1.8 billion in an initial public offering of stock. Partnerships controlled by Mr. Wen’s relatives — along with their friends and colleagues — made a fortune by investing in the company before the public offering.
In 2007, the last year the stock holdings were disclosed in public documents, those partnerships held as much as $2.2 billion worth of Ping An stock, according to an accounting of the investments by The Times that was verified by outside auditors. Ping An’s overall market value is now nearly $60 billion.
Ping An said in a statement that the company did “not know the background of the entities behind our shareholders.” The statement said, “Ping An has no means to know the intentions behind shareholders when they buy and sell our shares.”
While Communist Party regulations call for top officials to disclose their wealth and that of their immediate family members, no law or regulation prohibits relatives of even the most senior officials from becoming deal-makers or major investors — a loophole that effectively allows them to trade on their family name. Some Chinese argue that permitting the families of Communist Party leaders to profit from the country’s long economic boom has been important to ensuring elite support for market-oriented reforms.
Even so, the business dealings of Mr. Wen’s relatives have sometimes been hidden in ways that suggest the relatives are eager to avoid public scrutiny, the records filed with Chinese regulatory authorities show. Their ownership stakes are often veiled by an intricate web of holdings as many as five steps removed from the operating companies, according to the review.
In the case of Mr. Wen’s mother, The Times calculated her stake in Ping An — valued at $120 million in 2007 — by examining public records and government-issued identity cards, and by following the ownership trail to three Chinese investment entities. The name recorded on his mother’s shares was Taihong, a holding company registered in Tianjin, the prime minister’s hometown.
The apparent efforts to conceal the wealth reflect the highly charged politics surrounding the country’s ruling elite, many of whom are also enormously wealthy but reluctant to draw attention to their riches. When Bloomberg News reported in June that the extended family of Vice President Xi Jinping, set to become China’s next president, had amassed hundreds of millions of dollars in assets, the Chinese government blocked access inside the country to the Bloomberg Web site.
“In the senior leadership, there’s no family that doesn’t have these problems,” said a former government colleague of Wen Jiabao who has known him for more than 20 years and who spoke on the condition of anonymity. “His enemies are intentionally trying to smear him by letting this leak out.”
The Times presented its findings to the Chinese government for comment. The Foreign Ministry declined to respond to questions about the investments, the prime minister or his relatives. Members of Mr. Wen’s family also declined to comment or did not respond to requests for comment.
Duan Weihong, a wealthy businesswoman whose company, Taihong, was the investment vehicle for the Ping An shares held by the prime minister’s mother and other relatives, said the investments were actually her own. Ms. Duan, who comes from the prime minister’s hometown and is a close friend of his wife, said ownership of the shares was listed in the names of Mr. Wen’s relatives in an effort to conceal the size of Ms. Duan’s own holdings.
“When I invested in Ping An I didn’t want to be written about,” Ms. Duan said, “so I had my relatives find some other people to hold these shares for me.”
But it was an “accident,” she said, that her company chose the relatives of the prime minister as the listed shareholders — a process that required registering their official ID numbers and obtaining their signatures. Until presented with the names of the investors by The Times, she said, she had no idea that they had selected the relatives of Wen Jiabao.
The review of the corporate and regulatory records, which covers 1992 to 2012, found no holdings in Mr. Wen’s name. And it was not possible to determine from the documents whether he recused himself from any decisions that might have affected his relatives’ holdings, or whether they received preferential treatment on investments.
For much of his tenure, Wen Jiabao has been at the center of rumors and conjecture about efforts by his relatives to profit from his position. Yet until the review by The Times, there has been no detailed accounting of the family’s riches.
His wife, Zhang Beili, is one of the country’s leading authorities on jewelry and gemstones and is an accomplished businesswoman in her own right. By managing state diamond companies that were later privatized, The Times found, she helped her relatives parlay their minority stakes into a billion-dollar portfolio of insurance, technology and real estate ventures.
The couple’s only son sold a technology company he started to the family of Hong Kong’s richest man, Li Ka-shing, for $10 million, and used another investment vehicle to establish New Horizon Capital, now one of China’s biggest private equity firms, with partners like the government of Singapore, according to records and interviews with bankers.
The prime minister’s younger brother, Wen Jiahong, controls $200 million in assets, including wastewater treatment plants and recycling businesses, the records show.
As prime minister, Mr. Wen has staked out a position as a populist and a reformer, someone whom the state-run media has nicknamed “the People’s Premier” and “Grandpa Wen” because of his frequent outings to meet ordinary people, especially in moments of crisis like natural disasters.
While it is unclear how much the prime minister knows about his family’s wealth, State Department documents released by the WikiLeaks organization in 2010 included a cable that suggested Mr. Wen was aware of his relatives’ business dealings and unhappy about them.
“Wen is disgusted with his family’s activities, but is either unable or unwilling to curtail them,” a Chinese-born executive working at an American company in Shanghai told American diplomats, according to the 2007 cable.
China’s ‘Diamond Queen’
It is no secret in China’s elite circles that the prime minister’s wife, Zhang Beili, is rich, and that she has helped control the nation’s jewelry and gem trade. But her lucrative diamond businesses became an off-the-charts success only as her husband moved into the country’s top leadership ranks, the review of corporate and regulatory records by The Times found.
A geologist with an expertise in gemstones, Ms. Zhang is largely unknown among ordinary Chinese. She rarely travels with the prime minister or appears with him, and there are few official photographs of the couple together. And while people who have worked with her say she has a taste for jade and fine diamonds, they say she usually dresses modestly, does not exude glamour and prefers to wield influence behind the scenes, much like the relatives of other senior leaders.
The State Department documents released by WikiLeaks included a suggestion that Mr. Wen had once considered divorcing Ms. Zhang because she had exploited their relationship in her diamond trades. Taiwanese television reported in 2007 that Ms. Zhang had bought a pair of jade earrings worth about $275,000 at a Beijing trade show, though the source — a Taiwanese trader — later backed off the claim and Chinese government censors moved swiftly to block coverage of the subject in China, according to news reports at the time.
“Her business activities are known to everyone in the leadership,” said one banker who worked with relatives of Wen Jiabao. The banker said it was not unusual for her office to call upon businesspeople. “And if you get that call, how can you say no?”
Zhang Beili first gained influence in the 1990s, while working as a regulator at the Ministry of Geology. At the time, China’s jewelry market was still in its infancy.
While her husband was serving in China’s main leadership compound, known as Zhongnanhai, Ms. Zhang was setting industry standards in the jewelry and gem trade. She helped create the National Gemstone Testing Center in Beijing, and the Shanghai Diamond Exchange, two of the industry’s most powerful institutions.
In a country where the state has long dominated the marketplace, jewelry regulators often decided which companies could set up diamond-processing factories, and which would gain entry to the retail jewelry market. State regulators even formulated rules that required diamond sellers to buy certificates of authenticity for any diamond sold in China, from the government-run testing center in Beijing, which Ms. Zhang managed.
As a result, when executives from Cartier or De Beers visited China with hopes of selling diamonds and jewelry here, they often went to visit Ms. Zhang, who became known as China’s “diamond queen.”
“She’s the most important person there,” said Gaetano Cavalieri, president of the World Jewelry Confederation in Switzerland. “She was bridging relations between partners — Chinese and foreign partners.”
As early as 1992, people who worked with Ms. Zhang said, she had begun to blur the line between government official and businesswoman. As head of the state-owned China Mineral and Gem Corporation, she began investing the state company’s money in start-ups. And by the time her husband was named vice premier, in 1998, she was busy setting up business ventures with friends and relatives.
The state company she ran invested in a group of affiliated diamond companies, according to public records. Many of them were run by Ms. Zhang’s relatives — or colleagues who had worked with her at the National Gemstone Testing Center.
In 1993, for instance, the state company Ms. Zhang ran helped found Beijing Diamond, a big jewelry retailer. A year later, one of her younger brothers, Zhang Jianming, and two of her government colleagues personally acquired 80 percent of the company, according to shareholder registers. Beijing Diamond invested in Shenzhen Diamond, which was controlled by her brother-in-law, Wen Jiahong, the prime minister’s younger brother.
Among the successful undertakings was Sino-Diamond, a venture financed by the state-owned China Mineral and Gem Corporation, which she headed. The company had business ties with a state-owned company managed by another brother, Zhang Jiankun, who worked as an official in Jiaxing, Ms. Zhang’s hometown, in Zhejiang Province.
In the summer of 1999, after securing agreements to import diamonds from Russia and South Africa, Sino-Diamond went public, raising $50 million on the Shanghai Stock Exchange. The offering netted Ms. Zhang’s family about $8 million, according to corporate filings.
Although she was never listed as a shareholder, former colleagues and business partners say Ms. Zhang’s early diamond partnerships were the nucleus of a larger portfolio of companies she would later help her family and colleagues gain a stake in.
The Times found no indication that Wen Jiabao used his political clout to influence the diamond companies his relatives invested in. But former business partners said that the family’s success in diamonds, and beyond, was often bolstered with financial backing from wealthy businessmen who sought to curry favor with the prime minister’s family.
“After Wen became prime minister, his wife sold off some of her diamond investments and moved into new things,” said a Chinese executive who did business with the family. He asked not to be named because of fear of government retaliation. Corporate records show that beginning in the late 1990s, a series of rich businessmen took turns buying up large stakes in the diamond companies, often from relatives of Mr. Wen, and then helped them reinvest in other lucrative ventures, like real estate and finance.
According to corporate records and interviews, the businessmen often supplied accountants and office space to investment partnerships partly controlled by the relatives.
“When they formed companies,” said one businessman who set up a company with members of the Wen family, “Ms. Zhang stayed in the background. That’s how it worked.”
The Only Son
Late one evening early this year, the prime minister’s only son, Wen Yunsong, was in the cigar lounge at Xiu, an upscale bar and lounge at the Park Hyatt in Beijing. He was having cocktails as Beijing’s nouveau riche gathered around, clutching designer bags and wearing expensive business suits, according to two guests who were present.
In China, the children of senior leaders are widely believed to be in a class of their own. Known as “princelings,” they often hold Ivy League degrees, get V.I.P. treatment, and are even offered preferred pricing on shares in hot stock offerings.
They are also known as people who can get things done in China’s heavily regulated marketplace, where the state controls access. And in recent years, few princelings have been as bold as the younger Mr. Wen, who goes by the English name Winston and is about 40 years old.
A Times review of Winston Wen’s investments, and interviews with people who have known him for years, show that his deal-making has been extensive and lucrative, even by the standards of his princeling peers.
State-run giants like China Mobile have formed start-ups with him. In recent years, Winston Wen has been in talks with Hollywood studios about a financing deal.
Concerned that China does not have an elite boarding school for Chinese students, he recently hired the headmasters of Choate and Hotchkiss in Connecticut to oversee the creation of a $150 million private school now being built in the Beijing suburbs.
Winston Wen and his wife, moreover, have stakes in the technology industry and an electric company, as well as an indirect stake in Union Mobile Pay, the government-backed online payment platform — all while living in the prime minister’s residence, in central Beijing, according to corporate records and people familiar with the family’s investments.
“He’s not shy about using his influence to get things done,” said one venture capitalist who regularly meets with Winston Wen.
The younger Mr. Wen declined to comment. But in a telephone interview, his wife, Yang Xiaomeng, said her husband had been unfairly criticized for his business dealings.
“Everything that has been written about him has been wrong,” she said. “He’s really not doing that much business anymore.”
Winston Wen was educated in Beijing and then earned an engineering degree from the Beijing Institute of Technology. He went abroad and earned a master’s degree in engineering materials from the University of Windsor, in Canada, and an M.B.A. from the Kellogg School of Business at Northwestern University in Evanston, Ill., just outside Chicago.
When he returned to China in 2000, he helped set up three successful technology companies in five years, according to people familiar with those deals. Two of them were sold to Hong Kong businessmen, one to the family of Li Ka-shing, one of the wealthiest men in Asia.
Winston Wen’s earliest venture, an Internet data services provider called Unihub Global, was founded in 2000 with $2 million in start-up capital, according to Hong Kong and Beijing corporate filings. Financing came from a tight-knit group of relatives and his mother’s former colleagues from government and the diamond trade, as well as an associate of Cheng Yu-tung, patriarch of Hong Kong’s second-wealthiest family. The firm’s earliest customers were state-owned brokerage houses and Ping An, in which the Wen family has held a large financial stake.
He made an even bolder move in 2005, by pushing into private equity when he formed New Horizon Capital with a group of Chinese-born classmates from Northwestern. The firm quickly raised $100 million from investors, including SBI Holdings, a division of the Japanese group SoftBank, and Temasek, the Singapore government investment fund.
Under Mr. Wen, New Horizon established itself as a leading private equity firm, investing in biotech, solar, wind and construction equipment makers. Since it began operations, the firm has returned about $430 million to investors, a fourfold profit, according to SBI Holdings.
“Their first fund was dynamite,” said Kathleen Ng, editor of Asia Private Equity Review, an industry publication in Hong Kong. “And that allowed them to raise a lot more money.”
Today, New Horizon has more than $2.5 billion under management.
Some of Winston Wen’s deal-making, though, has attracted unwanted attention for the prime minister.
In 2010, when New Horizon acquired a 9 percent stake in a company called Sihuan Pharmaceuticals just two months before its public offering, the Hong Kong Stock Exchange said the late-stage investment violated its rules and forced the firm to return the stake. Still, New Horizon made a $46.5 million profit on the sale.
Soon after, New Horizon announced that Winston Wen had handed over day-to-day operations and taken up a position at the China Satellite Communications Corporation, a state-owned company that has ties to the Chinese space program. He has since been named chairman.
In the late 1990s, Duan Weihong was managing an office building and several other properties in Tianjin, the prime minister’s hometown in northern China, through her property company, Taihong. She was in her 20s and had studied at the Nanjing University of Science and Technology.
Around 2002, Ms. Duan went into business with several relatives of Wen Jiabao, transforming her property company into an investment vehicle of the same name. The company helped make Ms. Duan very wealthy.
It is not known whether Ms. Duan, now 43, is related to the prime minister. In a series of interviews, she first said she did not know any members of the Wen family, but later described herself as a friend of the family and particularly close to Zhang Beili, the prime minister’s wife. As happened to a handful of other Chinese entrepreneurs, Ms. Duan’s fortunes soared as she teamed up with the relatives and their network of friends and colleagues, though she described her relationship with them involving the shares in Ping An as existing on paper only and having no financial component.
Ms. Duan and other wealthy businesspeople — among them, six billionaires from across China — have been instrumental in getting multimillion-dollar ventures off the ground and, at crucial times, helping members of the Wen family set up investment vehicles to profit from them, according to investment bankers who have worked with all parties.
Established in Tianjin, Taihong had spectacular returns. In 2002, the company paid about $65 million to acquire a 3 percent stake in Ping An before its initial public offering, according to corporate records and Ms. Duan’s graduate school thesis. Five years later, those shares were worth $3.7 billion
The company’s Hong Kong affiliate, Great Ocean, also run by Ms. Duan, later formed a joint venture with the Beijing government and acquired a huge tract of land adjacent to Capital International Airport. Today, the site is home to a sprawling cargo and logistics center. Last year, Great Ocean sold its 53 percent stake in the project to a Singapore company for nearly $400 million.
That deal and several other investments, in luxury hotels, Beijing villa developments and the Hong Kong-listed BBMG, one of China’s largest building materials companies, have been instrumental to Ms. Duan’s accumulation of riches, according to The Times’s review of corporate records.
The review also showed that over the past decade there have been nearly three dozen individual shareholders of Taihong, many of whom are either relatives of Wen Jiabao or former colleagues of his wife.
The other wealthy entrepreneurs who have worked with the prime minister’s relatives declined to comment for this article. Ms. Duan strongly denied having financial ties to the prime minister or his relatives and said she was only trying to avoid publicity by listing others as owning Ping An shares. “The money I invested in Ping An was completely my own,” said Ms. Duan, who has served as a member of the Ping An board of supervisors. “Everything I did was legal.”
Another wealthy partner of the Wen relatives has been Cheng Yu-tung, who controls the Hong Kong conglomerate New World Development and is one of the richest men in Asia, worth about $15 billion, according to Forbes.
In the 1990s, New World was seeking a foothold in mainland China for a sister company that specializes in high-end retail jewelry. The retail chain, Chow Tai Fook, opened its first store in China in 1998.
Mr. Cheng and his associates invested in a diamond venture backed by the relatives of Mr. Wen and co-invested with them in an array of corporate entities, including Sino-Life, National Trust and Ping An, according to records and interviews with some of those involved. Those investments by Mr. Cheng are now worth at least $5 billion, according to the corporate filings. Chow Tai Fook, the jewelry chain, has also flourished. Today, China accounts for 60 percent of the chain’s $4.2 billion in annual revenue.
Mr. Cheng, 87, could not be reached for comment. Calls to New World Development were not returned.
Fallout for Premier
In the winter of 2007, just before he began his second term as prime minister, Wen Jiabao called for new measures to fight corruption, particularly among high-ranking officials.
“Leaders at all levels of government should take the lead in the antigraft drive,” he told a gathering of high-level party members in Beijing. “They should strictly ensure that their family members, friends and close subordinates do not abuse government influence.”
The speech was consistent with the prime minister’s earlier drive to toughen disclosure rules for public servants, and to require senior officials to reveal their family assets.
Whether Mr. Wen has made such disclosures for his own family is unclear, since the Communist Party does not release such information. Even so, many of the holdings found by The Times would not need to be disclosed under the rules since they are not held in the name of the prime minister’s immediate family — his wife, son and daughter.
Eighty percent of the $2.7 billion in assets identified in The Times’s investigation and verified by the outside auditors were held by, among others, the prime minister’s mother, his younger brother, two brothers-in-law, a sister-in-law, daughter-in-law and the parents of his son’s wife, none of whom is subject to party disclosure rules. The total value of the relatives’ stake in Ping An is based on calculations by The Times that were confirmed by the auditors. The total includes shares held by the relatives that were sold between 2004 and 2006, and the value of the remaining shares in late 2007, the last time the holdings were publicly disclosed.
Legal experts said that determining the precise value of holdings in China could be difficult because there might be undisclosed side agreements about the true beneficiaries.
“Complex corporate structures are not necessarily insidious,” said Curtis J. Milhaupt, a Columbia University Law School professor who has studied China’s corporate group structures. “But in a system like China’s, where corporate ownership and political power are closely intertwined, shell companies magnify questions about who owns what and where the money came from.”
Among the investors in the Wen family ventures are longtime business associates, former colleagues and college classmates, including Yu Jianming, who attended Northwestern with Winston Wen, and Zhang Yuhong, a longtime colleague of Wen Jiahong, the prime minister’s younger brother. The associates did not return telephone calls seeking comment.
Revelations about the Wen family’s wealth could weaken him politically.
Next month, at the 18th Party Congress in Beijing, the Communist Party is expected to announce a new generation of leaders. But the selection process has already been marred by one of the worst political scandals in decades, the downfall of Bo Xilai, the Chongqing party boss, who was vying for a top position.
In Beijing, Wen Jiabao is expected to step down as prime minister because he has reached retirement age. Political analysts say that even after leaving office he could remain a strong backstage political force. But documents showing that his relatives amassed a fortune during his tenure could diminish his standing, the analysts said.
“This will affect whatever residual power Wen has,” said Minxin Pei, an expert on Chinese leadership and a professor of government at Claremont McKenna College in California.
The prime minister’s supporters say he has not personally benefited from his extended family’s business dealings, and may not even be knowledgeable about the extent of them.
Last March, the prime minister hinted that he was at least aware of the persistent rumors about his relatives. During a nationally televised news conference in Beijing, he insisted that he had “never pursued personal gain” in public office.
“I have the courage to face the people and to face history,” he said in an emotional session. “There are people who will appreciate what I have done, but there are also people who will criticize me. Ultimately, history will have the final say.”
Statistics: Posted by yoda — Fri Oct 26, 2012 10:20 am
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CFTC’S Chilton: Silver Investigation Continues, Expects Something Public ‘In Near Future’
Editor’s Note: Introducing BREAKING NEWS AND VIEWS on Kitco.com, the latest tool to keep you in-touch with what’s happening in the markets. When big news hits you’ll find it first on Kitco.com.
(Kitco News) – The Commodity Futures Trading Commission is wrapping up its investigation of the silver market and while some sort of public announcement may come “in the near future,” nothing is “imminent,” said CFTC Commissioner Bart Chilton Friday.
“We’re still wrapping it up. There’s nothing imminent, but I envision saying something publicly in the near future,” Chilton told reporters at the Hard Assets conference in Chicago.
It’s been four years since the CFTC announced in September 2008 that it was investigating the silver market for possible manipulation. It’s unusual for the government agency to announce publicly that there is an ongoing investigation.
Chilton reiterated at the conference that he believes that there was illegal activity, but did not say what that might be. He told reporters that he was frustrated the investigation has not ended yet.
Chilton said speculative position limits go into effect Oct. 12 to cap the number of trades a single speculative trader can have in place to 10% of a contract’s first 25,000 in open interest.
In his address to attendees at the Hard Assets conference, Chilton said the financial industry should have some sort of user fee imposed to fund the CFTC, which is currently funded via taxpayers. Given that the CFTC is now in charge of the swaps market, which is around $700 billion globally versus the $5 billion size of the futures market, Chilton said the agency needs to have more employees to oversee the industry and greater funding.
“We’re the only financial regulator not (to) have user fees, (we should) at least (have) an increase. I think it’s time we have a user fee. Bush called for it, Obama’s called for it,” Chilton said, adding that he is working with the Office of Budget Management to come up with a potential user fee. “That’s still a ways away.”
Chilton said after the financial crisis that there needs to be a change in business culture. “We can’t regulate business ethos or morality. We can’t change business ethics… but what we need is a business cultural shift and we need to have this conversation,” he said.
He said he would “make suggestions” of what needs to be addressed to change the business culture, including reviewing the compensation structure in business where short-term winnings are rewarded, rather than longer-term thinking. “It rewards the trader that makes the big kills and not the risk manager,” he said.
That change in culture should also come with hiring, he said, both in the companies and on the corporate board level.
Chilton said the CFTC is going to propose that 35% of boards include public directors to get a diversity of views on the board. Additionally, the nominating committee should be comprised of 51% independent directors.
Regarding the bankruptcies of MF Global and Peregrine Financial, Chilton said he is promoting an insurance fund, similar to the Securities Investor Protection Corp., which protects investors in the securities industry. “It’s totally unfair that people in the securities industry have this, but not in the futures industry,” he said.
Russ Wassendorf Sr., the head of Peregrine, has pleaded guilty to fraud and is due for sentencing, but so far no one at MF Global has been charged with any possible fraud. Chilton said “it ain’t over until it’s over,” in regards to MF Global’s segregated funds being taken illegally. “It takes time to present a case.”
He spoke at length about the financial crisis and listed several banks which have received fines for various reasons. He expressed his own frustration at the size of the fines and the fact that no one has been imprisoned. "How come no one’s in jail for wrecking the economy? It wasn’t against the law,” Chilton said.
By Debbie Carlson of Kitco News firstname.lastname@example.org
Follow me on Twitter! If you want to keep up with metals news and features, then follow me on Twitter. It’s free, too. My account is @dcarlsonkitco
Statistics: Posted by DIGGER DAN — Sat Sep 22, 2012 11:55 pm
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Report of Investigation Fast & Furious: The Path to the White House
- Doug Hagmann & Judi McLeod Saturday, June 30, 2012
April 2009 CLAIM: Barack Obama, Eric Holder & Hillary Clinton publicly claim 90% of guns in Mexico come from U.S. Obama orders Holder to assess U.S. gun sales. The objective of Operation Fast & Furious was to substantiate these false claims, to enact stronger GUN CONTROL and attack Second Amendment rights.
See Full Report (PDF)
Fast & Furious: Paths leading to the White House Timeline
George Walker Bush administration
2005: To help combat firearms trafficking into Mexico, ATF began Project Gunrunner as a pilot project in Laredo, Texas, in 2005 (See OIG Report dated November 2010)i
2006: April: Project Gunrunner official launch date.ii
2007: June: ATF published a strategy document, Southwest Border Initiative: Project Gunrunner, outlining four key components to Project Gunrunner: the expansion of gun tracing in Mexico, international coordination, domestic activities, and intelligence. In implementing Project Gunrunner, ATF has focused resources in its four Southwest border field divisions.
January: Project Gunrunner expanded by adding 58 staff to the Southwest border field divisions, 3 additional staff to EPIC, and deploying eTrace to all U.S. consulates in Mexico.
June: Merida Initiative signed into law, allocated $2 million to expand Spanish eTrace throughout Mexico and Central America.
Barack Hussein Obama administration
February: The Recovery Act signed into law, allocated $10 million to ATF for Project Gunrunner.
February 25: DHS Secretary Napolitano testified in the House Homeland Security Committee, stressing that stopping the flow of guns to Mexico was a top priority of the Obama administration and key focus of her work.
*March 24, 2009: A 30-minute press conferenceiii was held at the White House by Press Secretary Robert Gibbs that included Department of Homeland Security Secretary Janet Napolitano, newly appointed Deputy Attorney General David Ogden, and Deputy Secretary of State Jim Steinberg. Ogden, who had been on the job for a mere 12 days, referred to Project Gunrunner and other ancillary ATF programs by name, and stated that he was working directly with the Attorney General on the implementation of these programs that included Project Gunrunner.
(See May 3, 2011)
June: Supplemental Appropriations Act of 2009 allocated an additional $6 million to ATF for Project Gunrunner.
December: Spanish eTrace piloted in Mexico; ATF Agent John DODSON, who later came forward about the tactics used by the ATF & DOJ, arrives in Phoenix.
January 16: Murder of Border Patrol Agent Brian Terry (Jaime AVILA) purchases 52 firearms – one of which was used to kill Agent Terry. Pays cash for purchase.
June: U.S. Fish & Wildlife Commission closes 3,500 acres of the Buenos Aires National Wildlife Refuge as the federal park was deemed too dangerous to the American public.
August: Emergency Border Security Supplemental Appropriations Bill of 2010 allocated $37.5 million to ATF for Project Gunrunner.(STIMULUS MONEY)
October: Agent John DODSON transferred from ATF to FBI
December 14: Agent Brian TERRY gunned down in Peck Canyon. The gun used is traced to Jaime AVILA, purchased from Lone Wolf Trading Company while under ATF surveillance. AVILA and purchase of 52 weapons
December 15: Washington Times publishes article blaming drug cartel gun violence on U.S. gun shops.
2010: 15,273 murders attributed to Mexican drug Cartel violence
January: Agent John Dodson meets with Senator Grassley to discuss Fast & Furious – investigation by Senate Judiciary Committee begins
January 20: ATF SAC Bill NEWELL holds press conference denies allowing guns to “walk”
January 27: Senator Grassley requests information about Operation Fast & Furious from Assistant AG Lanny Breuer
May 2: In advance of Holder’s testimony on 3 May 2011, Attorney General Eric Holder and DHS Secretary Janet Napolitano meet with Barack Obama in East Room at White House for an extended period.
May 3: In his capacity as U.S. Attorney General, Eric Holder testifies before the House Judiciary Committeeiv. During that hearing, Holder was questioned about Project Gunrunner and Operation Fast & Furious on two notable occasions. Holder was asked direct questions by Congressman Darrell Issa (49th District of California) about when he first learned of the operation, and who else knew about the project. This exchange begins about 90 minutes into the hearing, and Holder was elusive with his answers. He ultimately stated to the best of his recollection, he first became aware of the deadly operation within the last few weeks of that hearing. (See March 24, 2009)
February 4: Assistant AG Lanny Breuer denies Agent Dodson’s claims in letter to Grassley
February 15: ICE Agent Jamie ZAPATA killed in Mexico as he and his partner travel back to U.S. from embassy in Mexico City.
March 27: Obama appears on Spanish TV Univision, denies that he or Eric Holder knew anything about Fast & Furious
April: House Oversight Committee Chairman Daryl Issa issues subpoenas to Justice Department. Subpoenas are IGNORED.
June: Holder submits 800 pages of heavily redacted documents to House Oversight Committee Chairman Daryl Issa – Issa threatens contempt charges against Obama/Holder.
June 15: First House Oversight Committee hearing; Democrats call for gun control as a result of Operation Fast & Furious
June 30: House democrats submit legislation for gun control
July 11: New gun control reporting measures placed in force on border state gun shop owners.
July 14: E-mails found that confirm Operation Fast & Furious was implemented as a method to promote gun control.
See Full Report (PDF)
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INVESTIGATION INTO ‘BLACK MARKET’ OLYMPIC TICKET SALES
Sunday June 17,2012
By Roddy Ashworth THE International Olympic Committee has begun an inquiry into newspaper claims that foreign officials and agents have been selling tickets for the London 2012 Games on the black market for up to 10 times their face value.
A Sunday newspaper alleged thousands of tickets for showpiece main events, including the men’s 100-metre final, were being offered for sale.
The IOC warned it would impose its “strongest sanctions” on officials from any country found to have profited from sales.
It called an emergency meeting after being presented with a dossier of the two-month investigation’s findings on Friday.
Countries could be banned from selling tickets for future Olympics if their officials are found to have been involved in the sales of tickets.
It is claimed tickets were siphoned off from official supplies held by overseas national Olympic committees.
The IOC said it “takes these allegations very seriously and has immediately taken the first steps to investigate.”
Should any irregularities be proven, the organisation will deal with those involved in an appropriate manner
It added: “Should any irregularities be proven, the organisation will deal with those involved in an appropriate manner.”
The IOC will also consider a complete shake-up of how Olympic tickets are distributed among member countries.
The national committees are forbidden to sell their tickets abroad. However, the newspaper said undercover reporters posing as envoys of a Middle Eastern ticket tout found 27 officials and agents who were willing to trade.
These reportedly included one country’s official ticket agency which, it was alleged, offered category AA tickets, the best seats in the stadiums, to the fake tout for up to £6,000 each.
Statistics: Posted by yoda — Sun Jun 17, 2012 1:23 am
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The Strauss-Kahn Affair FRANCE 24 DSK: Who is the alleged victim?
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By most estimates,Lunettes de Soleil Bvlgari, the cost of DSK’s defence is likely to be measured in the hundreds of thousands – if not millions – of dollars.
Accused last week of attempting to rape a hotel chamber maid in New York, former IMF head Dominique Strauss-Kahn (known as DSK in France) can now rely on Guidepost Solutions detective agency,Lunettes de Soleil Prada, in addition to his top-flight legal defence team.
But in the US,lunettes rayban, not everyone has access to such services, due to the prohibitive cost of employing a detective agency. Private detectives cost at least 1,500 dollars a day, and expenses can add up to 700 dollars per hour.
Detectives hired by DSK's lawyers are digging up everything they can about the plaintiff
In the US, the system is “accusatory”. The prosecutor must gather evidence against the defendant in order to build a valid case. It falls entirely on the defence to prove their client’s innocence.
Forensic crime scene reports will be closely scrutinised,Lunettes De Soleil Ray Ban, and experts will be called upon to give their own conclusions on the evidence and the accuracy of the analyses. Guidepost has a special department with DNA experts.
The victim’s dealings with authorities – no matter how inconsequential – will be put under the microscope,Lunettes de Soleil Prada 2012, said Matthew Galluzzo,ray ban, a New York defence lawyer with experience of sexual assault cases.
In this context, all the evidence gathered by private detectives won’t necessarily have to be presented to the court.
DNA and forensics experts
Private detective Lawrence Frost told FRANCE 24 the defence team’s questioning of the plaintiff’s credibility as a witness would be relentless.
“Is it true you beat your children? Is it true you stole a loaf of bread? It it true you cheat on your husband?” he said,Lunettes de Soleil Carrera, outlining the kinds of questions the detectives would likely pose. “What you try to establish is that the complainant is capable of lying.”
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By James ANDRE
undermine her case.
These investigators have been hired to uncover any elements that could discredit the alleged victim. In the coming weeks, the detectives will rummage through the young woman’s entire history to find the slightest detail that could
Guidepost Solutions will not limit its activities to looking into the alleged victim’s past. The agency will also go through all the prosecution’s material with a fine-tooth comb.
According to the New York Times, Guidepost Solutions’ directors include a former head of the criminal division at the New York prosecutor’s office,Lunettes De Soleil, a former head of security at IT giant IBM and a former federal prosecutor who has worked closely with the US Secret Service.
The agency’s detectives could even ask for access to the hotel suite where the alleged crime was committed.
Finding the slightest fault
In France,Lunettes de Soleil Dolce Gabbana, an investigation is “inquisitional” – an investigating judge weighs the indictment against the defendant following an investigation by the prosecution and defence, then decides whether the case will go to trial.
JUSTICE Strauss-Kahn again denies charges in email to IMF FRANCE Strauss-Kahn’s sex crime allegations: What’s so funny? FINANCE IMF begins selection process for new chief Date created : 25/05/2011 Print Comment Send this page
Strauss-Kahn’s defence lawyer Benjamin Brafman may use elements of the evidence to negotiate a deal with the prosecution outside of court and/or have certain elements removed from the indictment.
“One thing one might look for is whether she has ever made false complaints in the past,” he said. “Maybe she has claimed she was raped once before and it turned out to not be true and she has a history of making false allegations. That would be helpful.”
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