US S&P suit points to ratings industry's role in crisis

Label:





NEW YORK: The US government's $5 billion lawsuit against Standard & Poor's for exaggerating mortgage bond ratings in 2007 has cast a pall over the ratings industry and exposed its role in the financial crisis.

S&P competitors Moody's and Fitch find themselves potentially facing penalties after the Justice Department alleged S&P knowingly kept ratings on high-risk mortgage securities high in order to win revenues from issuers.

The Justice Department has not said whether it has the other two ratings agencies in its sights, but Moody's spent much of the week fending off questions about whether it faces similar action following the S&P suit.

The New York Attorney General has meanwhile launched an investigation into all three companies over their ratings prior to the 2008 crisis, sources close to the matter told AFP.

S&P parent McGraw-Hill's shares plunged 27 percent after the suit was filed, and Moody's dropped 22 percent for the week, underscoring the market's worry that the crackdown on S&P may be just the tip of the iceberg.

"Investors have been selling those stocks aggressively this week and keep doing so out of fear that the situation with the Department of Justice could get a lot worse in the future," said Wedbush Securities analyst Michael James.

"They think there is probably more bad news to come."

The government's case argues that S&P knowingly placed triple-A ratings on billions of dollars worth of mortgage-based financial securities even as the US housing market collapsed, misrepresenting their true credit risk.

Many of the top-rated issues cited in the suit were in default within one year or less.

S&P exaggerated the ratings in part to please clients and keep issuer revenues high, the suit alleges.

US Attorney General Eric Holder called S&P's conduct "egregious", saying "it goes to the very heart of the recent financial crisis".

S&P has dismissed the lawsuit as "meritless" and said it plans to vigorously contest the claims.

The litigation, which reportedly came after settlement talks failed, poses a huge financial challenge to S&P and McGraw-Hill.

Justice Department officials said they intend to press for at least $5 billion in civil penalties to match the losses suffered by investors on the securities.

S&P is also being sued by 13 states, adding to the potential damages.

The attorney general of California cited two large institutional investors, the California Public Employees Retirement System and the California State Teachers Retirement System, which lost approximately $1 billion on the high-rated mortgage bonds.

A California statement said the suit claims triple damages.

To put those figures in context, McGraw-Hill earned $911 million in all of 2011.

Many were wondering if or when the government will take action against Moody's. A multi-billion dollar suit could devastate that company as well: on Friday, Moody's reported 2012 earnings of $690 million.

Jacob Frenkel, a former federal criminal prosecutor now in private practice with Shulman Rogers, said S&P could possibly settle the case in the range of "hundreds of millions of dollars".

But he said that the terms of a settlement -- what the company admits to, in addition to paying fines -- are crucial.

A key question concerns whether the government insists on S&P admitting liability, which could expose the firm to additional suits by investors in the securities it rated, Frenkel said.

Charles Elson, director of the John L. Weinberg Center for Corporate Governance, thinks the government could have a hard time proving its case against S&P.

"Unless you can show the opinion was reached in an intentionally reckless way, it's pretty hard to prove," Elson said.

Frenkel said the language in the complaint suggests the government could have pursued a criminal case against S&P.

That would raise the stakes: the 2002 US criminal conviction of former accounting giant Arthur Andersen in the aftermath of the Enron scandal eventually led to the firm's demise.

But Frenkel said the government is mainly focused on "integrity in the ratings process".

"The government would prefer to win a civil case than lose a criminal case," he said, "particularly where there is a concern about vaporizing the company."

- AFP/al



Read More..

Conspiracy theory: Was due process flouted to deny Afzal Guru a bid to escape hangman?

Label:
NEW DELHI: Although both have been executed in a hush-hush manner citing security reasons, the dilution of due process was greater in Mohammad Afzal Guru's hanging than in Ajmal Kasab's.

The denial of an opportunity to challenge the President's decision on the mercy petition was more likely to have affected Guru's fate for, unlike Kasab, he was not present at the crime scene when Parliament was attacked and he did not himself kill anybody.

In fact, after Kehar Singh's execution in the Indira Gandhi case, Guru was the only conspirator to have ever been hanged in connection with any high-profile crime. The three conspirators in the Rajiv Gandhi case, although awarded death penalty earlier than Guru, have so far been spared the noose because of a stay from the Madras high court on their execution. The stay came in 2011 on their plea that the death penalty be commuted to life sentence as the President had rejected their mercy petitions after an "inordinate and unexplained" delay.

Had he and his counsel been similarly given an advance notice of the rejection of his mercy petition, Guru too could have exercised his right to challenge the President's decision on the ground of delay, as he had filed his plea more than seven years ago.

Besides, Guru was better placed than Kasab to seek clemency on procedural and substantive grounds. Thanks to his oft-quoted grievance that he did not get a counsel of his choice during the trial, there has been much debate in legal and human rights circles on whether Guru had been given a fair trial.

Another controversial aspect of Guru's conviction is that successive courts had allegedly glossed over his claim that, as a surrendered militant, he had provided logistical support for the attack on Parliament on the instructions of security agencies in Kashmir.

The dilution of due process was also evident from the government's failure to comply with the stipulation of the jail manual to inform Guru's family about the date of the execution. The compromise is more evident in Guru's case because, unlike Kasab, his family members are Indians, who live in Kashmir. The rationale behind this stipulation is to provide the convict a chance to meet his family members for the last time.

In Kasab's case, the government claimed to have sent a communication to Pakistan to inform his family before his hanging. Despite the government's claim to have done the same in Guru's case, his family was in fact delivered with a fait accomppli.

This is the third mercy petition to have been rejected by President Pranab Mukherjee. Saibanna's case highlighted the deviation made in the cases of Kasab and Guru. For, the rejection of Saibanna's plea was made public, giving him scope to challenge it as also to meet his relatives.

Read More..

Mars Rover Curiosity Completes First Full Drill

Label:

For the first time in history, humans have drilled a hole into rock on Mars and are collecting the powdered results for analysis, NASA announced Saturday.

After weeks of intensive planning, the Mars rover Curiosity undertook its first full drill on Friday, with NASA receiving images on Saturday showing that the procedure was a success.

Curiosity drilled a hole that is a modest 2.5 inches (6.35 centimeters) deep and .6 inches (1.52 centimeters) wide but that holds the promise of potentially great discoveries. (Watch video of the Mars rover Curiosity.)

"The most advanced planetary robot ever designed now is a fully operating analytical laboratory on Mars," John Grunsfeld, NASA associate administrator for the agency's Science Mission Directorate, said in a statement on Saturday.

"This is the biggest milestone accomplishment for the Curiosity team since the sky-crane landing last August."

Read: Asteroid to Make Closest Flyby in History

The site of the much-anticipated penetration is a flat section of Mars rock that shows signs of having been underwater in its past.

Called Yellowknife Bay, it's the kind of environment where organic materials—the building block of life—might have been deposited and preserved long ago, at a time when Mars was far wetter and warmer than it is today.

The contents of the drilling are now being transferred into the rover's internal collection system, where the samples will be sieved down to size and scoured to minimize the presence of contamination from Earth. (Watch video of Curiosity's "Seven Minutes of Terror.")

Then the sample will be distributed to the two instruments most capable of determining what the rocks contain.

The first is the Sample Analysis on Mars (SAM), which has two ovens that can heat the powdered rock to almost 2000°F (1093°C) and release the rock's elements and compounds in a gaseous form.

The gases will then be analyzed by instruments that can identify precisely what they are, and when they might have been deposited. Scientists are looking for carbon-based organics believed to be essential for any potentially past life on Mars.

Powder will also go to the Chemistry and Mineralogy (CheMin) instrument for a related analysis that looks especially at the presence of minerals—especially those that can only be formed in the presence of water.

Louise Jandura, chief engineer for Curiosity's sample system at NASA's Jet Propulsion Laboratory, said that designing and testing a drill that can grab hold of Martian rock and commence first a percussive shallow drilling and then dig a deeper hole was difficult.

The drill, which is at the end of a 7-foot arm, is capable of about 100 discrete maneuvers.

"To get to the point of making this hole in a rock on Mars, we made eight drills and bored more than 1,200 holes in 20 types of rock on Earth," Jandura said in a statement.

Results from the SAM and CheMin analyses are not expected for several days to weeks.


Read More..

LAPD Reopens Case of Suspected Cop-Killer's Firing

Label:












The Los Angeles Police Department announced today it will reopen the case of the firing of Christopher Dorner, but said the decision was not made to "appease" the fugitive former cop suspected of killing three people.


Dorner, a fired and disgruntled former Los Angeles police officer, said in the so-called "manifesto" he released that he was targeting LAPD officials and their families and will keep killing until the truth is known about his case.


"I have no doubt that the law enforcement community will bring to an end the reign of terror perpetrated on our region by Christopher Jordan Dorner and he will be held accountable for his evil actions," LAPD Chief Charlie Beck said in a statement released tonight.


He spoke of the "tremendous strides" the LAPD has made in regaining public trust after numerous scandals, but added: "I am aware of the ghosts of the LAPD's past and one of my biggest concerns is that they will be resurrected by Dorner's allegations of racism within the Department."


To do that, he said, full re-investigation of the case that led to Dorner's firing is necessary.


"I feel we need to also publicly address Dorner's allegations regarding his termination of employment, and to do so I have directed our Professionals Standards Bureau and my Special Assistant for Constitutional Policing to completely review the Dorner complaint of 2007; To include a re-examination of all evidence and a re-interview of witnesses," he said. "We will also investigate any allegations made in his manifesto which were not included in his original complaint.






Irvine Police Department/AP Photo











Hundreds of Officers on Hunt for Alleged Cop Killer Watch Video











Christopher Dorner Manhunt: Ex-Cop Suspected in Killings Watch Video





"I do this not to appease a murderer. I do it to reassure the public that their police department is transparent and fair in all the things we do."


PHOTOS: Former LAPD Officer Suspected in Shootings


As police searched for Dorner today in the San Bernardino Mountains, sources told ABC News that investigators found two AR-15 assault rifles in the burned-out truck Dorner abandoned.


The truck had a broken axle, which may be the reason he decided to set fire to it, the police sources said.


A man identifying himself as Dorner taunted the father of Monica Quan four days after the former LAPD officer allegedly killed her and just 11 hours after he allegedly killed a police officer in Riverside, Calif., according to court documents obtained by ABC News


A man claiming to be Dorner called Randall Quan and told him that that he "should have done a better job of protecting his daughter," according to the documents.


In his 6,000-word "manifesto," Dorner named Randal Quan, a retired LAPD captain and attorney who represented him before a police review board that led to Dorner's dismissal from the force.


"I never had an opportunity to have a family of my own, I'm terminating yours," Dorner wrote, and directed Quan and other officials to "[l]ook your wives/husbands and surviving children directly in the face and tell them the truth as to why your children are dead."


Monica Quan and her fiancé Keith Lawrence were gunned down last Sunday in their car in the parking of their Irvine, Calif., condominium complex. Both were struck with multiple gunshot wounds.


The call, according to court records, was traced to Vancouver, Wash., but law enforcement officials do not believe Dorner was there at the time at the call.


Dorner is believed to have made the call early Thursday afternoon, less than half a day after he is suspected of killing a police officer and wounding two others early that morning, sparking an unprecedented man hunt involving more than a thousand police officers and federal agents spanning hundreds of miles.


FULL COVERAGE: Christopher Jordan Dorner






Read More..

Japan mulls disclosing evidence on China radar lock

Label:





TOKYO: Japan said on Saturday it was considering disclosing evidence to bolster its claim that a Chinese frigate locked its weapon-targeting radar on a Japanese ship, after Beijing rejected the charge.

The incident, which Japan said happened last week, marked the first time the two nations' navies have locked horns in a territorial dispute that has some commentators warning about possible armed conflict.

The neighbours -- also the world's second and third-largest economies -- have seen ties sour over uninhabited Japanese-controlled islands in the East China Sea known as Senkaku in Tokyo and Diaoyu by Beijing, which claims them.

"The government is considering the extent of what can be disclosed," Japan's Defence Minister Itsunori Onodera said on a television programme Saturday.

The comment came a day after Prime Minister Shinzo Abe demanded that Beijing apologise and admit the incident had happened.

Tokyo also charges that in the middle of last month a Chinese frigate's radar locked on to a helicopter, in a procedure known as "painting" that is a precursor to firing weaponry.

On both January 19 and January 30, China's defence ministry said in a statement faxed to AFP, the Chinese ship-board radar maintained normal operations and "fire-control radar was not used".

Japan hit back, with Foreign Minister Fumio Kishida saying he "cannot accept" the explanation and Prime Minister Abe demanding an apology from Beijing.

The Japanese premier on Thursday called the radar incident "extremely regrettable", "dangerous" and "provocative" but also said that dialogue must remain an option.

- AFP/xq



Read More..

Parliament House attack case convict hanged to death at 8am

Label:

NEW DELHI: Parliament House attack case convict Afzal Guru was hanged to death at Tihar Central Jail on Saturday morning.

The hanging took place in complete secrecy at around 8am with only a very select group of officials and home minister Sushilkumar Shinde knowing the operation to execute his death sentence.

His mercy plea, which had been pending since 2006, was rejected by the President Mukherjee late last month after getting the file from the home ministry on January 23.

Afzal Guru was convicted for his role in the attack on Parliament in 2001.

His hanging took place in as secret an operation as it had happened in the case of the hanging of the 26/11 Mumbai terror attack case convict Mohammed Ajmal Kasab who was hanged to death in a Pune jail in November last year.

Afzal Guru was given the death sentence by the Supreme Court in 2004. His hanging, scheduled for October 2006, was stayed after his wife filed a mercy petition on his behalf to the President.

Read More..

Space Pictures This Week: Sun Dragon, Celestial Seagull

Label:







































































































');
















































































































































































































































































































































































































































































































































































































































 $'+ doc.ngstore_price_t +'';
html += ' $'+ doc.ngstore_saleprice_t +'';
} else {
html += ' $'+ doc.ngstore_price_t +'';
}
html += '
';

$("#ecom_43331 ul.ecommerce_all_img").append(html);




o.totItems++;

}// end for loop
} // end if data.response.numFound != 0

if(o.totItems != o.maxItems){
if(o.defaultItems.length > 0){
o.getItemByID(o.defaultItems.shift());
} else if(o.isSearchPage && !o.searchComplete){
o.doSearchPage();
} else if(!o.searchComplete) {
o.byID = false;
o.doSearch();
}
}// end if
}// end parseResults function

o.trim = function(str) {
return str.replace(/^\s\s*/, '').replace(/\s\s*$/, '');
}

o.doSearchPage = function(){
o.byID = false;

var tempSearch = window.location.search;
var searchTerms ="default";
var temp;

if( tempSearch.substr(0,7) == "?search"){
temp = tempSearch.substr(7).split("&");
searchTerms = temp[0];
} else {
temp = tempSearch.split("&");
for(var j=0;j 0){
o.getItemByID(o.defaultItems.shift());
} else if(o.isSearchPage){
o.doSearchPage();
} else {
o.doSearch();
}

}// end init function

}// end ecommerce object

var store_43331 = new ecommerce_43331();





store_43331.init();
































































Great Energy Challenge Blog













































































































Read More..

Northeast Shuts Down as Blizzard Batters Millions

Label:












A blizzard of possibly historic proportions began battering the Northeast today, and could bring more than two feet of snow and strong winds that could shut down densely populated cities such as Boston and New York City.


A storm from the west joined forces with one from the south to form a nor'easter that will sit and spin just off the East Coast, affecting more than 43 million Americans. Wind gusts were forecast to reach 50 to 60 mph from Philadelphia to Boston.


Cape Cod, Mass., could possibly see 75 mph gusts. Boston and other parts of New England could see more than two feet of snow by Saturday.


The storm showed the potential for such ferocity that Massachusetts Gov. Deval Patrick declared a state of emergency Friday afternoon and signed an executive order banning vehicular traffic on roads in his state effective at 4 p.m. ET. It was believed that the last time the state enacted such a ban was during the blizzard of 1978. Violating the ban could result in a penalty of up to a year in jail and a $500 fine.


"[It] could definitely be a historic winter storm for the Northeast," said Adrienne Leptich of the National Weather Service in Upton, N.Y. "We're looking at very strong wind and heavy snow and we're also looking for some coastal flooding."


Airlines began shutting down operations Friday afternoon at major airports in the New York area as well as in Boston, Portland, Maine, Providence, R.I., and other Northeastern airports. By early evening Friday, more than 4,300 flights had been cancelled on Friday and Saturday, according to FlightAware. Airlines hoped to resume flights by Saturday afternoon, though normal schedules were not expected until Sunday.


The snow fell heavily Friday afternoon in New York City and 12 to 14 inches were expected. Mayor Michael Bloomberg said clearing the roads was his main concern, and the city readied 1,700 snow plows and 250,000 tons of salt to clear the streets.










Hurricane Sandy Victims Hit Again, Survivors Prepare for Worst Watch Video









Weather Forecast: Blizzard Headed for Northeast Watch Video





New York City was expecting up to 14 inches of snow, which started falling early this morning, though the heaviest amounts were expected to fall at night and into Saturday. Wind gusts of 55 mph were expected in New York City.


"Stay off the city streets. Stay out of your cars and stay at home while the worst of the storm is on us," Bloomberg said Friday.


Connecticut Gov. Dannel P. Malloy declared a state of emergency, deploying National Guard troops across the state to assist in rescues and other emergencies. Schools and state courthouses were closed, and all flights after 1:30 p.m. at Bradley Airport, north of Hartford, Conn., were cancelled. The state's largest utility companies planned for the possibility that 30 percent of customers -- more than 400,000 homes and businesses -- would lose power.


Malloy also directed drivers to stay off the state's major highways.


"Please stay off of 95, 91, 84, Merritt Parkway and any other limited-access road in the state," he said Friday evening.


PHOTOS: Northeast Braces for Snowstorm


Boston, Providence, R.I., Hartford, Conn., and other New England cities canceled school today.


"Stay off the streets of our city. Basically, stay home," Boston Mayor Tom Menino warned Thursday.


On Friday, Menino applauded the public's response.


"I'm very pleased with the compliance with the snow emergency," he said. "You drive down some of the roadways, you don't see one car."


As of 4:30 p.m. Friday, according to the Department of Defense, 837 National Guard soldiers and airmen under state control had been activated in Connecticut, Massachusetts and New York in anticipation of the storm -- 552 in Massachusetts, 235 in Connecticut and 50 in New York. The extra hands were helping with roadways, transportation, making wellness checks on residents and other emergency services.


Beach erosion and coastal flooding is possible from New Jersey to Long Island, N.Y., and into New England coastal areas. Some waves off the coast could reach more than 20 feet.


Blizzard warnings were posted for parts of New Jersey and New York's Long Island, as well as portions of Massachusetts, Rhode Island and Connecticut, including Hartford, New Haven, Conn., and Providence. The warnings extended into New Hampshire and Maine.


To the south, Philadelphia was looking at a possible 4 to 6 inches of snow.


In anticipation of the storm, Amtrak said its Northeast trains would stop running this afternoon.






Read More..

Lawmakers divided on Postal Service plan

Label:

Lawmakers wrestled Thursday with how to address Postmaster General Patrick R. Donahoe’s announcement that the U.S. Postal Service plans to end Saturday mail delivery in August.


Donahoe moved to circumvent Congress’s long-standing resistance to the proposal for five-day delivery, a move the Postal Service thinks will save about $2 billion annually and help ease its financial losses. The agency lost $15.9 billion in the last fiscal year.


The postmaster took advantage of legislators’ own dysfunction over budget matters this week, gambling that lawmakers will not thwart his plan after Congress’s temporary spending measure expires March 27.

The spending plan includes language requiring six-day delivery, but lawmakers have not said whether they will insist on the language in the next spending bill.

It appeared Thursday that the issue was shaping up among lawmakers like the discussions over the automatic spending cuts, known as sequestration, which are set to kick in March 1.

Legislators questioned the legality of Donahoe’s plan and pointed fingers over Congress’s inability last year to achieve comprehensive postal reform, but none outlined a strategy to prevent the Postal Service’s effort.

Senate Majority Leader Harry M. Reid (D-Nev.) said in a statement Thursday that such a drastic policy move requires congressional approval.

“The Postmaster General relied on flawed legal guidance to claim that he can circumvent Congress’s authority,” he said.

Reid also expressed frustration at lawmakers’ failure last year on postal reform. “This unfortunate scenario could have been wholly prevented if the House had passed the Senate’s bipartisan postal reform bill in the last Congress,” he said.

Sen. Susan Collins (R-Maine), who serves on the Senate Appropriations Committee and supported the Senate’s bill last year, said, “The Postal Service’s decision to eliminate Saturday delivery is inconsistent with current law and threatens to further jeopardize its customer base.”

Other Republicans applauded Donahoe.

Rep. Darrel Issa (R-Calif.), chairman of the House Committee on Oversight and Government Reform, which oversees the Postal Service, supports the plan. His office said the Postal Service could legally alter Saturday mail services despite any future provisions Congress might enact to require six-day delivery. “In its announced change, USPS is not eliminating a day of delivery, but rather altering what products are delivered on that day,” a spokesman said.

The Postal Service did not respond to requests for comment Thursday. Although it plans to end Saturday mail delivery, it has said that it will continue delivering packages on Saturdays and that post offices will be open to sell stamps and other materials. Post office boxes will receive mail on Saturdays, but magazines and some newspapers, catalogues and Netflix will not reach homes that day.

Sen. Bernard Sanders (I-Vt.), who opposes Donahoe’s decision, said in an interview Thursday that he would fight any effort to remove the six-day-delivery requirement from the next spending bill. But he stopped short of saying he would vote against an appropriations bill that does not include the mandate.

“The future of the Postal Service is very important, but it has to be looked at in a broader context,” Sanders said.

Last year, the House and Senate produced competing bills to help staunch the Postal Service’s financial losses. The Senate approved legislation that would have delayed five-day mail delivery for two years while trying out other cost-saving tactics, but the House never voted on the measure. A House bill that would have ended Saturday delivery right away never reached the floor.

House Appropriations Chairman Harold Rogers (R-Ky.) said he had no idea what his committee would do about the postal plan.

Said Rep. Steny H. Hoyer (D-Md.): “I think the problem is the will of the Congress has not been expressed. Congress has not acted, and I think that left a vacuum.”

Read More..

S Korean activists jailed for unauthorised visit to North

Label:





SEOUL: A South Korean court jailed an elderly left-wing activist for four years on Friday for making an unauthorised trip across the border to North Korea.

Ro Su-Hui, 69, was convicted of violating a strict security law that penalises pro-Pyongyang activity and bans citizens from going to the North without prior permission.

Another activist, Won Jin-Wook, received a three-year prison sentence for communicating with North Korean officials to arrange Ro's trip.

Ro, 69, entered the North via China in March last year for a memorial service marking the 100th day since the death of long-time ruler Kim Jong-Il.

He praised new ruler Kim Jong-Un during his time in Pyongyang and was arrested in July when he returned home.

"Stern punishment is inevitable because he made a secret visit to North Korea without permission and was involved in (pro-North Korean) activities, even if he knew that his activities would be used for propaganda," the court said in its ruling.

Seoul did not send any official representatives to Kim Jong-Il's funeral and approved trips only by two private delegations.

- AFP/xq



Read More..

Subscribe to: Posts (Atom)