Category: Corruption

The Trade Deals Being Negotiated Just Got Worse

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In addition to the TPP and the TTIP, we now have the Trade In Services Agreement (TiSA), which looks to vitiate national privacy, net neutrality, and consumer protections:

The US is attempting to secure immunity from investigation for online security breaches by major US companies under negotiations between Washington and Brussels, according to leaked documents seen by the Guardian.

 Such a deal would prevent US companies that were operating inside the EU from being prosecuted by regulators or law officers for data breaches or claims of negligence in the host country, forcing European governments to pursue cases in the US courts.

 Public service unions said the Trade in Services Agreement (Tisa) talks in Geneva revealed how the US planned to protect homegrown businesses from regulations that might hinder their expansion into sensitive areas such as government data handling and healthcare.

 Rosa Pavanelli, general secretary of Public Services International (PSI), which represents 650 unions in 150 countries, said the leaked documents, obtained by the Associated Whistleblowing Press, confirmed her fears that “Tisa is being used to further the interests of some of the largest corporations on earth”.

 She said: “It is now clear the US wants to use its trade agenda to remove restrictions to data being held or processed in other countries.”

The Association of Whistleblowing Press link is here, and an earlier Wikileaks leak is here.

Here is nickel tour of what it all means:

  • Corporations to move any possibility liability to the most weakly regulated venue (“No Party may prevent a service supplier of another Party from transferring, accessing, processing or storing information, including personal information, within or outside the Party’s territory, where such activity is carried out in connection with the conduct of the service supplier’s business.”)
  • It has a broad carve-out for  national security that is a censor’s wet dream (“Nothing in [Articles X.1 – X.6] shall be construed to prevent any Party from taking any action which it considers necessary for the protection of its own essential security interests.”)
  • It would prohibit meaningful net neutrality regulation (“Each Party recognizes that consumers in its territory, subject to applicable laws, and regulations, should be able to: (a) access and use services and applications of their choice available on the Internet, subject to reasonable network management;”)

(emphasis mine)

The cynic in me understands why Obama came out in front of net neutrality regulation:  Once TiSA goes through, any FCC ruling is moot.

He gets to play at consumer protection while taking it all away with a fast track vote on the treaty.

Reviewing Stories Over the Past Year, This One Wins the Award for Best “A Good Start”

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I did not notice this story when the Global Post published it in April, but when they republished the fact that Vietnam is executing corrupt bankers, I felt kind of jealous:

Editor’s note: This story was first published on April 3, 2014. GlobalPost is featuring it again as one of our must-reads of 2014.

BANGKOK — For the most part, American bankers whose rash pursuit of profit brought on the 2008 global financial collapse didn’t get indicted. They got bonuses.
Odds are that scandal would have played out differently in Vietnam, another nation struggling with misbehaving bankers.


The authoritarian Southeast Asian state doesn’t just send unscrupulous financiers to jail. Sometimes, it sends them to death row.

Amid a sweeping cleanup of its financial sector, Vietnam has sentenced three bankers to death in the past six months.

One duo now on death row embezzled roughly $25 million from the state-owned Vietnam Agribank. Their co-conspirators caught decade-plus prison sentences.

 I do not approve of capital punishment, but this whole “Decades-plus prison sentence” thing?  That I wholeheartedly approve.

Corporate Purchase of the Criminal Justice System: MPAA Edition

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It appears that Google is involved in a pissing contest with the Mississippi Attorney General .

It appears that the latter is doing a cut and paste of MPAA legal filing.

Thankfully, the Sony hack has revealed these machinations:

Tensions between Google and Mississippi Attorney General Jim Hood exploded into public view this week, as Google filed court papers seeking to halt a broad subpoena Hood sent to the company.

 The Hood subpoena, delivered in late October, didn’t come out of nowhere. Hood’s investigation got revved up after at least a year of intense lobbying by the Motion Picture Association of America (MPAA). E-mails that hackers acquired from Sony Pictures executives and then dumped publicly now show the inner workings of how that lobbying advanced—and just how extensive it was. Attorneys at Sony were on a short list of top Hollywood lawyers frequently updated about the MPAA’s “Attorney General Project,” along with those at Disney, Warner Brothers, 21st Century Fox, NBC Universal, and Paramount.

 The e-mails show a staggering level of access to, and influence over, elected officials. The MPAA’s single-minded obsession: altering search results and other products (such as “autocompleted” search queries) from Google, a company the movie studios began referring to as “Goliath” in around February 2014. The studios’ goal was to quickly get pirated content off the Web; unhappy about the state of Google’s voluntary compliance with their demands and frustrated in their efforts at passing new federal law such as SOPA and PIPA, the MPAA has turned instead to state law enforcement.

 The most controversial elements of SOPA/PIPA would have let content owners effectively shut down websites they said were infringing their copyrights or trademarks. This already happens—think of various peer-to-peer sites that no longer exist—but it usually involves drawn-out litigation. SOPA promised a faster-moving process that would have essentially made rights holders a website’s judge, jury, and executioner.

 To get the same results in a post-SOPA world, MPAA has hired some of the nation’s most well-connected lawyers. The project is spearheaded by Thomas Perrelli, a Jenner & Block partner and former Obama Administration lawyer. Perrelli has given attorneys general (AGs) across the country their talking points, suggesting realistic “asks” prior to key meetings with Google. Frustrated with a lack of results, Perrelli and top MPAA lawyers then authorized an “expanded Goliath strategy” in which they would push the AGs to move beyond mere letter writing. Instead, they would seek full-bore investigations against Google.

 If the AGs felt short on resources—well, Hollywood studios could help with that. Money from Sony and other Big Six studios was available to draft the actual subpoenas, to research legal theories to prosecute Google, to spread negative press about the search giant, and to reach out to other state AGs that might join with Hood.

 ………

 One chain of e-mails among the MPAA and studio lawyers bears the subject line “STATE ATTORNEY GENERAL PROJECT” and focuses on how Google could be pressured into altering its search results, demoting or removing so-called “rogue sites” that host high levels of copyrighted context.

 Most notes on the project came from Vans Stevenson, the MPAA’s VP of state legislative affairs; higher-level updates were written by MPAA general counsel Steven Fabrizio or took the form of memos written by Perrelli. Most information about the AG project was shared with a group of more than 30 lawyers, including several from the MPAA and RIAA, as well as each of the six big studios, but some were kept to just general counsels and their immediate confidantes.

 “[Attorney] General Hood told me by e-mail today that his conversation ‘with Google’s General Counsel did not go well,’ and therefore he followed up with the letter that was sent yesterday,” Vans Stevenson informed the group in November 2013. “Hood also said he was organizing a meeting during the NAAG [National Association of Attorneys General] meeting next week in New Orleans with his outside counsel Mike Moore, former MS Attorney General. Also attending that meeting will be MPAA/RIAA outside counsel Tom Perrelli and others, ‘so we can discuss the next move,’ Hood wrote…. I will keep you advised of further developments.”

 The e-mail includes a letter from Hood to Google general counsel Kent Walker. It was published earlier this week by The New York Times, which reported that most of the letter was actually written by Perrelli’s law firm.

(emphasis mine)

Google counter-sued, which has the AG Hood calling for a timeout:

It appears that Mississippi Attorney General Jim Hood is making a strategic retreat in the wake of publicity about his investigation of Google.

On Friday morning, Google sued Hood, saying that a 79-page subpoena he had sent to the company was “punitive,” and violated Google’s First and Fourth Amendment rights. The company also pointed to recent press reports that showed Hollywood studios had lobbied heavily for the investigation.

Later that day, Hood sent a statement to The New York Times saying that he’s “calling a time out, so that cooler heads may prevail.” Hood says he wants to negotiate a “peaceful resolution to the issues affecting consumers” that he and other state AGs have pointed out in a series of letters.

Rather unsurprisingly, after the Mississippi AG told the press that he had received no funding from the MPAA, and challenged them to look, the press looked, and to no one’s surprise, they found MPAA money:

The saga of Mississippi Attorney General Jim Hood and his cozy ties to Hollywood continue to come out. He’s been claiming that, sure, he met with Hollywood’s top lawyer, Tom Perrelli, had him prep Hood for a meeting with Google, and even took a ~4,000 word angry letter that Perrelli wrote for him, signed it as his own and sent it to Google — but he did all that without knowing that Perrelli worked for Hollywood’s top lobbying arm, the MPAA. Uh huh.

And then in a press conference, he insisted that he was doing this out of his own interest in protecting the children — but also admitted that his office didn’t have any intellectual property experts and didn’t have a million dollars to do an investigation (approximately the amount the MPAA’s leaked emails show them discussing to fund this investigation) and that he needed to rely on such help from “victims” to make his case. It’s fairly rare, though, that “victims” of a crime run the actual law enforcement investigation and fund it as well.

Still, in that last post, we also mentioned how Hood implied that anyone suggesting he was “paid off” might be defaming him, and apparently also stated that he wasn’t getting any money from Hollywood, encouraging reporters to “check records.”

Okay then. Let’s… check the records. Here, for example, is the MPAA’s Political Action Committee apparently giving $2,500 to an operation called “The Friends of Jim Hood.”

And, you can also look at the public record of who donated to his campaign, which pretty clearly shows donations to his campaign from NBC Universal and 20th Century Fox.

And it goes on and on.

One big take away about all this is that the leaked emails reveal that the Hollywood studios long term goal is to break DNS:

Most anti-piracy tools take one of two paths: they either target the server that’s sharing the files (pulling videos off YouTube or taking down sites like The Pirate Bay) or they make it harder to find (delisting offshore sites that share infringing content). But leaked documents reveal a frightening line of attack that’s currently being considered by the MPAA: What if you simply erased any record that the site was there in the first place?

A bold challenge to the basic engineering of the internet

To do that, the MPAA’s lawyers would target the Domain Name System (DNS) that directs traffic across the internet. The tactic was first proposed as part of the Stop Online Piracy Act (SOPA) in 2011, but three years after the law failed in Congress, the MPAA has been looking for legal justification for the practice in existing law and working with ISPs like Comcast to examine how a system might work technically. If the system works, DNS-blocking could be the key to the MPAA’s long-standing goal of blocking sites from delivering content to the US. At the same time, it represents a bold challenge to the basic engineering of the internet, threatening to break the very backbone of the web and drawing the industry into an increasingly nasty fight with Google.

One final note, it appears that various legislators and Attorneys General are trying to restrict the practice of AGs getting secret funding from industry to prosecute cases.

Notice however how the New York Times story completely avoids mention that the MPAA was literally writing an AG’s legal documents:

In state legislatures and major professional associations, a bipartisan effort is emerging to change the way state attorneys general interact with lobbyists, campaign donors and other corporate representatives.

This month, during a closed-door meeting of the National Association of Attorneys General, officials voted to stop accepting corporate sponsorships. In Missouri, a bill has been introduced that would require the attorney general, as well as certain other state officials, to disclose within 48 hours any political contribution worth more than $500. And in Washington State, legislation is being drafted to bar attorneys general who leave office from lobbying their former colleagues for a year.

Perhaps most significant, a White House ethics lawyer in the administration of George W. Bush has asked the American Bar Association to change its national code of conduct to prohibit attorneys general from discussing continuing investigations or other official matters while participating in fund-raising events at resort destinations, as they often now do. Those measures could be adopted in individual states.

The actions follow a series of articles in The New York Times that examined how lawyers and lobbyists — from major corporations, energy companies and even plaintiffs’ law firms — have increasingly tried to influence state attorneys general.

These outside players have tried to shut down investigations, enlist the attorneys general as partners in litigation, or use their clout to try to block or strengthen regulations emerging from Washington, the investigation by The Times found.

While it may be a stretch to say that a lot of state Attorneys General are for sale, they certainly appear to be for rent.

So Not Surprised

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It appears that the USAF is cooking the books on A-10 use in Afghanistan to justify retiring the Warthog:

Over the past five months, Air Force leaders have pointed to one key fact while advocating for their controversial decision to retire the A-10 Warthog, an aircraft specifically designed to provide support to ground troops. The service’s top leaders say the vast majority of so-called “close air support” missions conducted in Afghanistan since 2006 have been flown by a variety of aircraft that are not A-10s. Specifically, the leaders say that the 80 percent of these missions conducted by aircraft other than the Warthog shows that a variety of aircraft can do the critical mission of reinforcing ground forces with firepower from the air.

However, a number of observers challenge the Air Force’s claim that 80 percent of close air support missions are really conducted by non-A-10 planes. These observers assert that the service has deliberately manipulated the data to support its case.

The plan to retire the A-10 has sparked a firestorm of criticism from members of Congress, A-10 pilots and airmen whose job is to embed with ground forces and call in air strikes.

In fact, Congress is well on the way to rejecting the Air Force’s plans. The House of Representatives passed legislation Thursday, rejecting sending the A-10s to the boneyard. The Senate is expected to do the same.

The Air Force says it can save $4.2 billion over the next five years by retiring the fleet of 350 A-10s. The savings would be plowed into other aircraft that can perform a variety of missions, including close air support.

And, in making the case to retire the A-10, the one number that comes up time and again at congressional hearings is this: 80 percent.

………

The PBS NewsHour asked the Air Force about the basis for the 80 percent figure. The NewsHour shared the Air Force answers with A-10 supporters and those who advocate retiring the aircraft. The complete exchange can be viewed in the document linked here.

“This is a classic case of using numbers as propaganda for some bureaucratic position.”“This 80 percent number is a total fabrication,” said Pierre Sprey, one of the key designers of the A-10 in the 1960s and 1970s. Sprey has recently been lobbying Congress to save the aircraft. “This is a classic case of using numbers as propaganda for some bureaucratic position.”

Among the data the Air Force provided was a breakdown of the number close air support sorties flown between 2010 to 1014: 121,653. Also included was the number of sorties with at least one weapon released: 8,691.

Sprey notes that of the 121,653 close air support missions conducted, “93 percent of them never drop a weapon.” Sprey says the Air Force is “counting a whole lot of fluff.”

“The Air Force is counting these missions or these activities in a way that biases strongly against the A-10,” said Winslow Wheeler, a former congressional staffer with more than three decades of experience working for both Democrats and Republicans. Wheeler is now with the Project On Government Oversight, a non-profit watchdog organization.

The Air Force is “not counting sorties where actual munitions delivery actually occurs,” he said. And they are “not distinguishing” between bombing fixed points on the ground from 20,000 feet and supporting troops that are moving while under fire from an enemy in close proximity. Wheeler said it is in situations like this “that really count” and where the A-10 outperforms all other aircraft.

………

“Measures of kinetic activity alone don’t capture events where aircraft presence was sufficient to deter attackers — which can be the better outcome in COIN [counterinsurgency] operations,” Sholtis explained in an email. “Actions like shows of force or armed overwatch of ground forces are legitimate and effective forms of CAS.” Shows of force are when aircraft fly overhead, making their presence known and signaling to the enemy — sometimes by dropping flares — that they might get bombed.

But counting shows of force is stretching the definition of close air support, according to retired Chief Master Sergeant Russell Carpenter, a 30-year veteran and specialist in leading troops who call in air strikes. When you “look up the definition of close air support, shows of force doesn’t fit in there.” Carpenter said what the Air Force has “done is said there are a variety of ways we achieve air-to-ground effects. But guess what, call that something else. But it is not close air support.”

Another controversial aspect in the way the 80 percent number was generated is the time frame of when close air support missions are counted. According to Air Force data released to the NewsHour, the service counted missions flown between 2006 and October 2013.

The Air Force told the NewsHour “unfortunately we do not have information prior to 2006 available in our AFCENT Combined Air Operations Center database.” Other Air Force officers who asked that their names not be used in this article, because they were not authorized to speak publicly, also told the NewsHour that the Air Force has not maintained records from before 2006.

But critics are skeptical.

“The date 2006 was not picked by accident,” said Sprey, the A-10 aircraft designer.

From March 2002 to December 2006, the only fixed-wing aircraft that could operate from the austere and dilapidated runways in Afghanistan were A-10s, according to the Air Force. Sprey believes counting close air support missions beginning in 2006 is suspect because that time period marks the point when different types of aircraft were beginning to operate out of the newly improved runways in Afghanistan.

“Before 2006, they couldn’t even get fighters into Afghanistan, they couldn’t land anywhere,” Sprey said. “They were totally dependent on the A-10 before and they don’t want to admit that, so they don’t tell you about it before 2006.”

The USAF has wanted to kill the A-10 and replace it with a “Wild Blue Yonder” alternative  since it began to enter service in the 1970s.

Close air support has been a responsibility that the Air Force has consistently shirked since before its creation as an independent service.

Merry Christmas from the NSA

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You know how people drop bad news on Friday evenings in Government?

Well, the NSA just dropped some sh%$ so heavy that they waited until Christmas Eve:

The National Security Agency on Christmas Eve day released twelve years of internal oversight reports documenting abusive and improper practices by agency employees. The heavily redacted reports to the President’s Intelligence Oversight Board found that NSA employees repeatedly engaged in unauthorized surveillance of communications by American citizens, failed to follow legal guidelines regarding the retention of private information, and shared data with unauthorized recipients.

While the NSA has come under public pressure for openness since high-profile revelations by whistleblower Edward Snowden, the release of the heavily redacted internal reports at 1:30PM on Christmas Eve demonstrates limits to the agency’s attempts to demonstrate transparency. Releasing bad news right before a holiday weekend, often called a “Christmas Eve surprise,” is a common tactic for trying to minimize press coverage.

The reports, released in response to a Freedom of Information Act request submitted by the American Civil Liberties Union, offer few revelations, but contain accounts of internal behavior embarrassing to the agency. In one instance an NSA employee “searched her spouse’s personal telephone directory without his knowledge to obtain names and telephone numbers for targeting”, a practice which previous reports have indicated was common enough to warrant the name “LOVEINT”.

Many of the reports appear to deal with instances of human error rather than malicious misuse of agency resources. Nonetheless, many of these errors are potentially serious, including entries suggesting that unminimized U.S. telephone numbers were mistakenly disseminated to unauthorized parties and that military personnel were given unauthorized access to raw traffic databases collected under the Foreign Intelligence Services Act.

Yeah, and the people who did this are still on the job:

For the most part, the reports don’t appear to contain anything especially new, but I was struck by this particular violation:

………The OIG’s Office of Investigation initiated an investigation of an allegation than an NSA analyst had conducted an unauthorized intelligence activity. In an interview conducted by the NSA/CSS Office of Security and Counterintelligence, the analyst reported that, during the past two or three years, she had searched her spouse’s personal telephone directory without his knowledge to obtain names and telephone numbers for targeting….Although the investigation is ongoing, the analyst has been advised to cease her activities.

If the NSA gave even half a f%$# about this sort of abuse, this analyst would be fired, and her security clearance would be pulled.

Instead, she was “advised to cease her activities.”

This is why super-secret organizations need real independent oversight, because their first priority is preserving their own prerogatives, using whatever means necessary.

Full report here. (PDF)

Quote of the Day

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If we render our torturers superior to the political institutions of the government, and if we render the police superior to the civil power of elected officials, then we essentially have empowered independent standing armies to conduct our wars and enforce our laws, and self-government descends into bloody farce.

—Charlie Pierce

He is taking about how our torturers and our police demand to operate with impunity.

Well, It’s a Start

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South Korea has indicted Uber CEO Travis Kalanick:

South Korea has indicted the chief executive officer and local subsidiary of Uber Technologies Inc for violating a law governing public transport, becoming the latest jurisdiction to challenge the U.S. taxi service provider.

The Seoul Central District Prosecutors’ Office issued the indictment against CEO Travis Kalanick and the firm’s Korean unit for violating a law prohibiting individuals or firms without appropriate licenses from providing or facilitating transportation services, an Uber spokeswoman said.

The prosecutors’ office declined to comment.

“Uber Technologies respects the Korean legal system and will provide its full cooperation,” the company said in a statement without detailing the charges brought against it.

Uber, through its apps, charges fees to play matchmaker for passengers and drivers – some registered as taxi drivers. But a lack of regulation for the relatively new business model has brought Uber to the attention of authorities worldwide.

Taiwan and the Chinese mainland city of Chongqing on Monday separately said they were investigating Uber over concerns it and its drivers were not appropriately licensed.

Seeing as how Uber’s basic business model is lawlessness with a few legal walls to ensure that people like Kalanick will never face any liability for anything, the idea that he has been personally indicted is a good thing.

Here’s hoping that he he actually has to stand trial there.

Another Statement of Obama’s that is “Inoperative”*

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Cliff Stone, who worked with the State Department finding places to send innocent Guantánamo detainees once they were cleared for released, has resigned in the slow pace of releases:

The State Department envoy who negotiates detainee transfers from the military prison at Guantánamo Bay, Cuba, is resigning, dealing another blow to President Obama’s efforts to close a facility that top administration officials say is a blight on the country’s international standing.

The resignation of Cliff Sloan, a close confidant of Secretary of State John Kerry, comes as officials at the State Department and the White House have increasingly expressed frustration with the Defense Department’s slow pace of transferring approved prisoners.

In an interview on Monday, Mr. Sloan denied that he was leaving because he was frustrated by foot-dragging at the Pentagon. He said he had always intended to stay a maximum of 18 months, noting that he was right on schedule.

“Frustration with the Defense Department’s slow pace of transferring approved prisoners,” my ass.

The military is not a democracy. Barack Obama is commander-in-chief.

If someone is dragging their feet, Obama can fire them.

What’s more, I would argue that he has a moral obligation to fire them.

Guantánamo is more than a moral cancer on America. It is a source of outrage in the Arab world, and is one of the most power recruiting tools that Jihadis have.

*Yes, I am invoking the memory of former Nixon Press Secretary Ron Ziegler.

It’s Been 6 Years, and Finally a Regulator Forces a CEO to Resign

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Rather unsurprisingly, the regulator in question, is New York Superintendent of Financial Services Benjamin Lawsky, who has had nothing to do with the Obama administration.

He went after the astonishingly corrupt and incompetent mortgage servicer Ocwen, and uncovered self-dealing by the CEO that forced his resignation.

It would have been nice if William Erbey were breaking rocks somewhere, but it is a start:

Let’s say you run a company whose misdeeds are splashed across the front pages of the business section on an almost weekly basis. You might reasonably expect to be fired without delay. But then let’s also stipulate that you’re in the financial services industry. Recent history suggests you’ll be able to keep your job and your handsome bonus, and that even if law enforcement officials penalize the company for improprieties, somebody else—like your shareholders— will pay those fines, leaving you to continue your charmed life unscathed.

 William Erbey, the billionaire chairman of the mortgage servicing giant Ocwen, probably thought that would be his fate as well, but he didn’t anticipate the determination of New York Superintendent of Financial Services Benjamin Lawsky. On Monday, Lawsky announced Erbey would step down chairman of Ocwen and four related businesses, as part of the settlement of an investigation into the company’s sad enduring legacy of ripping off homeowners.

 It isn’t a prison sentence. But on the spectrum of accountability for financial industry executives, “forced to resign” beats “suffered no consequences while staying in power.”

 Lawsky has been chasing Ocwen for several years. A mortgage servicer handles day-to-day operations on loans, from collecting monthly payments to making decisions after a default. Ocwen has grown almost ten-fold since 2009 by purchasing the rights to service distressed loans from the likes of JPMorgan Chase, Bank of America, and Ally Bank. Big banks have engaged in a fire sale of their mortgage servicing rights, because of increased compliance standards for servicing, and because of new bank capital rules that make servicing loans costly. As a non-bank, Ocwen has more wherewithal to handle mortgage servicing, and this has made it the 4th-largest servicer in America. ………

 ………

 The federal Consumer Financial Protection Bureau found similar problems with Ocwen and reached an agreement on a $2.1 billion settlement. But most of the money went toward modifying loans that Ocwen serviced but didn’t own, allowing it to pay the fine with other people’s money.

 More recently, Lawsky uncovered more Ocwen secrets. He discovered that four other public companies chaired by Ocwen chairman William Erbey have close business relationships with the mortgage servicer (Erbey is also the largest individual shareholder for all the companies). One subsidiary hosts nearly all of Ocwen’s online auctions; another handles all Ocwen post-foreclosure real estate transactions. So Ocwen profits by funneling default-related business to closely associated companies, providing an incentive to push borrowers into default.

 Lawsky also found that Ocwen backdated letters to borrowers, making it impossible for them to challenge denials of their mortgage modifications within a specific time frame. He also investigated whether Ocwen stalled short sales, where homes get sold for less than the balance on the mortgage, in order to collect additional fees.

And here is the special sauce:

This time, Lawsky did not spare top executives. Erbey will resign both Ocwen and the four related companies by January 16, and subsequently hold “no directorial, management, oversight, consulting, or any other role at Ocwen or any related party.” Any other Ocwen employees also working for one of the other four companies will have to drop those responsibilities.

 Under the agreement, Ocwen will add two new independent board positions, and an Operations Monitor will work directly with the board on oversight functions, and determine whether other senior management will have to be fired. Ocwen cannot acquire other mortgage servicing rights without the consent of the Operations Monitor.

 Ocwen will also pay $150 million to New York homeowners harmed by the company. Instead of a “soft-dollar” promise of mortgage modifications that Ocwen can pass on to the owners of the loans they service, these are cash penalties—$100 million to the Department of Financial Services for housing counseling and community redevelopment programs, and $50 million to be split by Ocwen foreclosure victims, with $10,000 for each borrower on whom Ocwen completed foreclosure, and the rest handed out to those with active foreclosures in process. Ocwen will also have to re-evaluate borrowers in foreclosure after paying the penalty, “in light of their improved financial condition resulting from such payment.”

Ocwen cannot take a tax deduction on any of these payments, per the agreement. The company also agreed to provide all of its New York borrowers with their complete loan files upon request, along with assurances to detail reasons for any denials of mortgage relief. As the loan files represent evidence in private borrower misconduct litigation, it could expose Ocwen to further legal headaches.

Seriously, if there had been any appetite for even a cursory investigation of the banksters by Obama and His Evil Minions™, we would have seen a lot more of this.

Then again, if we did that, Obama would not be able to get his 6 figure speaking gigs from Wall Street execs when he leaves offices.

One has to have priorities.

After All, Spying on Congress and Lying About is No Big Deal………

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Investigators Said to Seek No Penalty for C.I.A. s Computer Search – NYTimes.com:

A panel investigating the Central Intelligence Agency’s search of a computer network used by staff members of the Senate Intelligence Committee who were looking into the C.I.A.’s use of torture will recommend against punishing anyone involved in the episode, according to current and former government officials.

 The panel will make that recommendation after the five C.I.A. officials who were singled out by the agency’s inspector general this year for improperly ordering and carrying out the computer searches staunchly defended their actions, saying that they were lawful and in some cases done at the behest of John O. Brennan, the C.I.A. director.

 While effectively rejecting the most significant conclusions of the inspector general’s report, the panel, appointed by Mr. Brennan and composed of three C.I.A. officers and two members from outside the agency, is still expected to criticize agency missteps that contributed to the fight with Congress.

But its decision not to recommend anyone for disciplinary action is likely to anger members of the Intelligence Committee, who have accused the C.I.A. of trampling on the independence of Congress and interfering with its investigation of agency wrongdoing. The computer searches occurred late last year while the committee was finishing an excoriating report on the agency’s detention and interrogation program.

So, the investigative body created by John O. Brennan has discovered that the CIA, on the orders of John O. Brennan, spied on the committee investigating them, but hey, no harm no foul.

Which means that no one at the CIA, including John O. Brennan, suffers any discipline.

If Barack “The Worst Constitutional Law Professor Ever.™” Obama actually cared about the constitutional checks and balances, or his promise to run a transparent government, John O. Brennan would be spending more time with his family right now.

Cable Company F%$#ery

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South Park got it right

HBO Go is a service that allows subscribers to the HBO channel to view content on PCs, tablets, and other devices.

The kicker is that for now, though I expect this to change as it renegotiates contracts, in order to use this service, you need to have your cable/fiber company certify that you are an HBO subscriber in order to get the service.

Guess what? Comcast, the most loathed company in America, is refusing to provide this information for its subscribers:

One of the more dubious Comcast practices brought up by opponents of Comcast’s planned $45 billion acquisition of Time Warner Cable is the cable giant’s sluggish refusal to support certain internet video services and platforms running over its broadband network. Case in point is the HBO Go app on Roku, which Comcast hasn’t supported since around 2011 or so for no coherent reason. To get the app to work, it needs to simply authenticate with the cable provider to prove you are a cable subscriber (since, at least until next year, there’s no HBO Go standalone option).

Much smaller cable companies haven’t had a problem in getting this to work, but Comcast, with its limited resources, somehow just can’t seem to spend the time. Roku’s neutrality filing with the FCC expressed concern that cable authentication systems could be used as yet another way gatekeepers could extract tolls from streaming services. As we noted when Comcast similarly refused to support HBO Go on the Playstation 3, the company — when it can be bothered to comment on the issue at all — usually trots out the excuse that getting this stuff to work is well, gosh — time consuming:

“With every new website, device or player we authenticate, we need to work through technical integration and customer service which takes time and resources. Moving forward, we will continue to prioritize as we partner with various players.”

It certainly does appear to be a case of priorities. With Comcast looking to eliminate any and all justifications to reject its merger, the company this week announced its network would finally support HBO Go on Roku — some three years later. It couldn’t possibly be that Comcast intentionally stalled on supporting HBO Go on the country’s best-selling third-party streaming device because it wants to keep customers contained within the Comcast set top ecosystem and away from other options, could it?

I really think that if a politician of either party were to say that his goal would to make Comcast, “Squeal like a pig,” he would be elected President.

But we still have politicians going to their knees to “service” the cable giants.

Yes, Jeb Bush Should be Stapled to the Whole Sordid Terri Schaivo Affaire

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Charlie Pierce reminds us of what he did:

Jeb Bush made a family tragedy into a family horror. He willingly put the power of his office behind lunatics who were jumping fences, calling bomb threats into elementary schools, putting bounties on Michael Schiavo’s head, and endagering great people doing wonderful work at a hospice. This episode shouldn’t be an obscure part of his past. It should define him as a politician, and as a man.

Just to remind you.

Terri Schiavo was in a persistent vegetative state, and then Governor Jeb Bush decided to intervene to prevent the removal of her feeding tube in a transparent attempt to make nice with the “Pro-Life” terrorist crowd.

Michael Schiavo, Terri’s husband, and the target of this obscenity, has some choice words for the “smart” Bush:

In his announcement Tuesday that he would explore a 2016 presidential bid, former Gov. Jeb Bush (R-FL) promised to focus on “ideas and policies that will expand opportunity and prosperity for all Americans.” But he made no mention of his most controversial act during his two terms in office: his attempts to take custody of Terri Schiavo and overrule her husband Michael’s decision to remove her feeding tube, fifteen years after cardiac arrest had left her in a vegetative state.

ThinkProgress spoke with Michael Schiavo and the attorney who represented him in the matter, George Felos, about Bush’s presidential candidacy. Both expressed concern that Bush’s record was one of government interference and opposing individual liberty.

“If you want a government that’s gonna intrude on your life, enforce their personal views on you, then I guess Jeb Bush is your man,” Schiavo explained, adding, “We really don’t need another Bush in office.”

………

Though Michael Schiavo got a court order in 2002 to remove his wife’s feeding tube — he said his wife had not wanted to be kept alive artificially — Jeb Bush intervened, pushing the state legislature to pass an unconstitutional bill in a special session giving him authority to order the feeding tube reinserted. When a state judge ordered it removed again, Felos told ThinkProgress, Bush “manipulated the organs of state government in order to try to evade the court order.”

“Through the Dept. of Children and Family Services and through the Department of Law Enforcement they tried in the courts to ignore the higher court pronouncements – this was documented in an article by the Miami Herald,” he recalled, though, “when local authorities said you’re going to have to go through us in order to get her, and the state law enforcement agency backed down.”

………

“It’s one thing to have your own personal beliefs,” Felos said, “It’s quite another to use your official powers and your official office to subvert the court and the lawful process.”

He also recalled that after Schiavo’s death, Jeb Bush went after Michael Schiavo personally, asking the state’s attorney to investigate whether he had called 911 fast enough. “It was very odd, almost like a personal vendetta the governor had towards Michael Schaivo.” The state’s attorney found no evidence against him and closed the case. “The propriety of using your office to hunt and harass people, as the governor did to Mr. Schiavo after his wife’s death, I think raises significant questions about his judgment and his character,” Felos said.

Michael Schiavo, nearly a decade later, said he believes Jeb Bush’s intervention was a purely political move and an act of buffoonery. “If you want a government that’s gonna be intrusive and interfere in your personal life, vote for Bush. If you want to live like that, want people to interfere in your personal lives, then vote for him,” he said.

The whole Schiavo matter defines who and what Jeb Bush is as a politician and as a person.

It should also be noted that when it became national news, the American public recoiled in horror.

They should recoil in horror at Jeb Bush as well.

And Just to Prove that there is No Event that Uber Won’t Use an Excuse for Price Gouging………

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The internet based limo service jacked up its rates in Sydney in response to the hostage crisis there:

Uber briefly charged its users in downtown Sydney a minimum $100 to escape an armed hostage crisis, a result of automatic surge pricing meant to get more drivers online.

An executive in the city’s Central Business District (CBD) sent Mashable screenshots of the Uber app that showed the company was charging up to four-times the normal rate because “demand is off the charts.”

“I have never, ever seen it at four-times [the normal rate] and I’m a 1% top Uber user,” said Matthew Leung, the user in contact with Mashable. “I understand the way the business works — higher the demand, higher the charge — but four-times at $100 minimum is ridiculous. Almost price gouging at its worst.”

Another customer shared a screenshot of their “wack” fare estimate that showed a trip from an area just blocks from the siege to the airport would cost $145-185. That journey would normally cost less than $100, according to Uber’s website. “This is price surging,” he wrote in a comment to Mashable.

After Mashable published a story on the price hikes, the company reversed course and announced that all riders in the area would be free, and that anybody who had been charged the higher amount would be refunded.

I can hear Uber’s CEO, Travis Kalanick, saying, “And I would have gotten away with it too, if it weren’t for you meddling kids.”

Seriously,  Uber, and its Ayn Rand worshiping CEO are simply too evil to trust with your money.

Obama Must Hate Warren Right Now

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Elizabeth Warren’s campaign against Wall Street insider Antonio Weiss’ nomination for undersecretary for domestic finance for the US Treasury is picking up steam:

Under pressure from progressive groups to reject Wall Street influence, three more Senate Democrats yesterday turned against the nomination of Antonio Weiss for a senior post at the U.S. Treasury Department.

President Barack Obama’s choice of Weiss, an investment banker at Lazard Ltd. (LAZ), has put him at the center of an ideological fight within the Democratic Party over the finance industry’s clout in Washington.

The attacks are coming from Democrats who say the Obama administration relies too much on Wall Street veterans to fill important regulatory posts. They are criticizing Weiss, in particular, for his role in engineering tax-lowering inversion deals for U.S. companies.

The opposition yesterday from Joe Manchin of West Virginia, Jeanne Shaheen of New Hampshire and Al Franken of Minnesota further complicates the nomination for the administration and Democratic leaders. After defending Weiss’s Democratic bona fides and accepting his campaign contributions, they’ll have to turn to Republicans to get him into office.

“This fits the administration’s pattern of choosing Wall Street insiders to senior policy positions instead of those with strong consumer protection or community bank and credit union experience,” Manchin said on the Senate floor yesterday.

There are now note enough Democratic votes to 

Neither Shaheen nor Manchin are representatives of the “Democratic Wing of the Democratic Party,” and the fact that they are bucking the President is a big deal.

It appears that the idea that someone who has no background in domestic finance is a good selection for the undersecretary for domestic finance, simply because they are a big Democratic donor, and they have a background in the financial industry is no longer as universally held as it used to be.

It also appears that people are finally getting the idea that multimillion dollar payouts from the financial industry for people who go into government service is implicitly corrupt.

Good.

Any discomfort that Barack Obama might experience because a portion of the Democratic Party has realized that he is Wall Streets biggest fan is well deserved.

Welcome to the Handmaiden’s Tale

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A judge in Minnesota just gave a free pass to employers who don’t want to cover contraceptives. I’m wondering when a Jehovah’s Witness gets to deny coverage for blood transfusions:

A federal judge in Minneapolis ruled Monday that the owner of Hastings Ford and Hastings Chrysler Center does not have to pay for health insurance coverage for certain contraceptives such as Plan B, ella emergency contraceptive and certain kinds of IUDs.

Douglas Erickson said in a lawsuit that contraceptives that prevent a fertilized egg from being implanted in a woman’s uterus violate his belief that life begins at conception. Erickson’s businesses have 63 full-time employees and about 15 part-timers.

The ruling by U.S. District Judge Paul Magnuson is the latest in a string of decisions involving family-owned businesses that have sued to become exempt from a portion of the federal Affordable Care Act because of their religious beliefs.

………

Planned Parenthood of Minnesota and North and South Dakota issued a statement Tuesday after the ruling became public.

“It’s unbelievable that we are still fighting for access to birth control in 2014, with some politicians who want to get rid of the birth control benefit completely,” the statement said. “We know firsthand that access to birth control is both a health care and economic concern for women.”

Here’s a hearty f%$# you to the Supreme Court over the Hobby Lobby decision.

Not Enough Bullets

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As former federal regulator Bill Black notes, the second circuit court decision effectively legalizes insider trading:

We know that insider trading is an activity in which cheaters prosper. We know that Wall Street and the City of London are dominated by a fraudulent culture and we know that firm culture is set by the officers that control the firm. We know that the Department of Justice (DOJ) has allowed that to occur by refusing to prosecute any of the thousands of senior bank officers who became wealthy by leading the three most destructive financial fraud epidemics (appraisals, “liar’s” loans, and fraudulent sales of these fraudulently originated mortgages to the secondary market) in history. No one is surprised that Wall Street’s elites have also engaged in widespread efforts to rig the stock markets so that they can shoot fish in the barrel through insider trading. Unlike the three fraud epidemics, one DOJ office, the Southern District of New York, has brought a series of criminal prosecutions against these officers.

 Wall Street’s court of appeals (the Second Circuit) has just issued an opinion not simply overturning guilty verdicts but making it impossible to retry the elite Wall Street defendants that grew wealthy through trading on insider information. Indeed, the opinion reads like a roadmap (or a script) that every corrupt Wall Street elite can follow to create a cynical system of cutouts (ala SAC) that will allow the most senior elites to profit by trading on insider information as a matter of routine with total impunity. The Second Circuit decision makes any moderately sophisticated insider trading scheme that uses cutouts to protect the elite traders a perfect crime. It is a perfect crime because (1) it is guaranteed to make the elite traders who trades on the basis of what he knows is secret, insider information wealthy absent successful prosecutions and (2) using the Second Circuit’s decision as a fraud roadmap, an elite trader can arrange the scheme with total impunity from the criminal laws. The Second Circuit ruling appears to make the financial version of “don’t ask; don’t tell” a complete defense to insider trading prosecutions. The Second Circuit does not simply make it harder to prosecute – they make it impossible to prosecute sophisticated insider fraud schemes in which the elites use junior cutouts to create (totally implausible) deniability.

The New York Times article on the decision was entitled “Two Insider Trading Convictions Are Overturned in Blow to Prosecutors.” The title is partially correct. The real blows, however, were to investors, the already crippled integrity of Wall Street, and every honest trader on Wall Street who cannot possibly compete with his rivals who cheat through the “sure thing” of insider trading now that the Second Circuit has written an opinion explaining how to corrupt the entire system with impunity from the criminal laws.

………

The Second Circuit decision admits that the prosecutors presented evidence established a massive conspiracy designed to allow Wall Street elites to profit by engaging in insider trading, a conspiracy that greatly enriched the defendants that were convicted in the case under appeal.

“At trial, the Government presented evidence that a group of financial analysts exchanged information they obtained from company insiders, both directly and more often indirectly. Specifically, the Government alleged that these analysts received information from insiders at Dell and NVIDIA disclosing those companies’ earnings numbers before they were publicly released in Dell’s May 2008 and August 2008 earnings announcements and NVIDIA’s May 2008 earnings announcement. These analysts then passed the inside information to their portfolio managers, including Newman and Chiasson, who, in turn, executed trades in Dell and NVIDIA stock, earning approximately $4 million and $68 million, respectively, in profits for their respective funds.”

The Second Circuit was not distressed that senior Wall Street officials received information that was clearly insider information that they knew they should not have access to. The insider information they were provided was the crown jewels – two major corporations’ soon to be announced “numbers” – at least one of which was sure to be a major surprise to the markets. A senior trader that knows “the number” in advance, particularly when he knows that the number will be a surprise, can shoot fish in a small barrel with a large shotgun. The insider information allows the senior trader to reduce the risk of loss to trivial levels while increasing the probability of gain to near certainty. The trader makes a fortune by cheating, not through any unusual skill. The senior trader knows that no employee of any publicly traded corporation is permitted to release such secret and proprietary insider information to investors.

The Second Circuit was not distressed that the senior Wall Street officials did not react to being provided what was clearly insider information by demanding to know how their analysts got the information and instructing them that their actions violated the firms’ ethical standards and would lead to their termination if it were ever repeated. The firm’s ethics manuals banned the senior traders from trading on the basis of insider information. Instead, of serving as ethical leaders in training the analysts not to engage in such behavior and instead of following their firm’s ban on trading on the basis of insider information, the senior officers engaged in a cynical financial version of “don’t ask; don’t tell.” The analysts and the senior officials that traded on the inside information understood the wisdom of the old line “ask me no questions and I’ll tell you know lies.” The senior officers proceeded to profit by exploiting this advantage over honest investors while minimizing the risk of a successful prosecution not by being ethical, but by consciously maintaining (not remotely) “plausible deniability.”

………

But worse will soon come. The Second Circuit’s decision is a “how to” manual on how elites Wall Streeters can become wealthy through insider trading with impunity from the criminal laws. The Second Circuit opinion shows that using a “cutout” is the key to achieve the “sure thing” of enormous wealth through insider trading without financial or legal risk. The Second Circuit lays out the game plan. The little folks in the organization develop the contacts with insiders in publicly traded firms. The analysts function initially like any good intelligence agent recruiting an asset. These assets have insider information of their employers, the publicly traded corporations. The analyst develops a rapport with the employee or exploits an existing tie. The analyst shows the employee a very good time – a taste of how good his life can be if he plays ball. But the analyst doesn’t make any explicit promises or deals. (In the case decided by the Second Circuit others cutouts earlier in the insider trading chain made the corrupt payments to the employees.) The Wall Street senior officers who grow wealthy by trading the insider information will make sure that the analysts are well cared for – discretely and at a later date.

The analyst then has to do one thing and avoid doing a second. Both are simple. The analyst needs to signal to his superior that the information is reliable. The government complaint against SAC show one the innumerable means of sending that signal. The government’s appellate brief contains the text of an email in which an analyst explicitly conveyed the reliable track record of the leakers of the inside information to the senior traders so that they could be sure they had a “sure thing” by investing on the basis of the inside information.

The analyst needs not to explicitly tell the senior officer conducting the trade that the insider information was the product of a deal in which the employee who leaks the insider information was explicitly promised a quid pro quo to the leaker. Again, the government complaint against SAC and the government appellate brief in the case reversed by the Second Circuit show in detail how simple it is to design systems of not making these matters explicit. That is why the Second Circuit ruling imperils prosecutions in every case in which the insider trading scheme was done with even modest cleverness.

………

The Second Circuit’s reasoning has the perverse effect that the more corrupt individuals engaged in the insider trading scheme the more likely the scheme is to be declared lawful as long as the traders use their corrupt colleagues as cutouts. Note that the Second Circuit reasoning does not simply make it harder to prosecute sophisticated insider trading schemes – it holds that the actions of the elite traders who know that they are achieving the “sure thing” of immense insider trading profits on the basis of deliberate leaks of that information are not unlawful and cannot be prosecuted. The Second Circuit has created the perfect crime and publicized how to shape the scheme to insure wealth and impunity through creating widespread chains designed to corrupt the markets, employees of the publicly traded corporations, and the Wall Street firms.

The tone of the opinion is particularly galling. The Second Circuit is not even mildly distressed by the result. It expresses disdain for the idea that Wall Street elites should not be able to enrich themselves with complete impunity from the laws through corrupt arrangements such as those proven at the trial. The opinion consciously deliberately creates a straw man argument designed to hide the fact that insider trading schemes of this make it impossible for honest competitors to prevail through skill and hard work.

I’m hoping that someone manages to take them down before the banksters destroy us all.

If This Isn’t Suborning Perjury, It’s Still a Violation of Legal Ethics

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One of the things that prosecutors are not supposed to do is to encourage a witness to lie. It’s called suborning perjury, and it is a crime.

On a marginally lower level of corruption and malfeasance is knowingly putting a witness on the stand who you know will lie.

In what is surprisingly unsurprising news, it turns out that the St. Louis prosecutors office called a witness to testify in the Michael Brown killing who they knew to be lying:

So, you are Prosecutor Bob McCulloch. You have a grand jury investigation with the entire world watching. One of your witnesses in support of the officer is revealed by the FBI to have made up her entire account. What do you do?

Apparently you present a discredited witness to the grand jury anyways. He played the FBI interview, which revealed that Witness 40’s car was not at the location, that 40 could not have exited in the manner described, that 40 did not even tell anyone her story until over two weeks after the shooting. They tore her apart, showing that she changed her story several times while sitting on the stand. For example, in her interview, 40 claimed to have made no contact to the police for two weeks, then later claimed that she did contact them several times before agreeing to be a witness. And that is not the only occasion they caught her changing her story, with other times her lack of knowledge of the crime scene, how her journal and testimony did not match, how the exit for the complex did not exist where she claimed all being revealed. That interview, found on pages 86-184 of Grand Jury Testimony Volume 15, completely discredits her as a witness.

Then, fully knowing this, Bob McCulloch brought her before the grand jury, and entered her hand written journals filled with racist language into the record. And this testimony, by a discredited witness, is the one cited by right-wing media outlets in their attempts to support former Ferguson officer Darren Wilson. Claims of Michael Brown charging like a bull? Her account, and only her account.

 Seriously, why does Bob McCulloch still have a law license?

I So Wish She Were Running for President

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Elizabeth Warren just opened up a serious can of whup ass on the Obama toadies who are pushing for the nomination of Antonio Weiss for Treasury undersecretary for domestic policy:

Sen. Elizabeth Warren (D-MA) made clear on Tuesday that she is not swayed by supporters of Obama administration nominee for Treasury undersecretary for domestic policy Antonio Weiss. Warren upped the ante in the unusually heated nomination fight, even mocking his defenders who point out that he supports “poetry.”

………

Warren, in her speech at an event hosted by the Economic Policy Institute, the Roosevelt Institute and Americans for Financial Reform, ticked off the most common points defenders of Weiss have made about his nomination.

“He spent the last 20 years at the investment bank Lazard and has been named to be under secretary for domestic finance at the Treasury Department. He is focused on international corporate mergers — companies buying and selling each other,” Warren said. “Now, it may be interesting, challenging, but it does not sufficiently qualify him to oversee consumer protection and domestic regulatory functions at the Treasury Department.”

………

Weiss’s nomination contradicts the Obama administration’s opposition to bringing in personnel who won’t have conflicts of interest with Wall Street, Warren said.

“Now, this matters because at the end of the day the administration undercuts its own opposition to this practice by nominating someone who was involved in a high profile, cross boarder inversion and who, by the way, made $15 million in the last few years, working for Lazard, a firm that did three of the four major announced inversions,” Warren said “And by the way, Lazard isn’t an American company anymore either. It already moved to Bermuda to cut its taxes.”

Recent profiles of Weiss, oddly, have included the fact that he’s been involved in publishing the Paris Review in ticking off his Democratic bona fides. That wasn’t lost on Warren.

“Third, and maybe you can help me understand this argument, people say opposition to Weiss is unreasonable because, wait for it, he likes poetry,” Warren said. “I’m actually not kidding on this one. Supposedly because he helps publish a literary magazine called the Paris Review we should trust that he will zealously pursue financial reform. Now I confess, I don’t read many literary magazines but, really?”

In leaving Lazard, Warren noted that Weiss would receive a golden parachute of about $20 million.

“For me, this is just one spin of the revolving door too many. Enough is enough,” Warren said. “The response to these concerns has been, let’s say, loud. First his supporters say ‘come on, he’s an investment banker so of course he should be qualified to oversee complicated financial work at treasury. But his defenders haven’t shown his actual experience that qualifies him for this job at treasury.”

One of the more substantive arguments against Warren’s opposition to Weiss is that he’s as good as could possibly be gotten in a nominee for a top treasury position. Warren said she has supported qualified people with ties to Wall Street but that’s not what Weiss is.

“Look, when I set up the new Consumer Financial Protection Bureau I interviewed, I hired, and I worked alongside many people with Wall Street experience and I was glad to do so. In the Senate I have voted for plenty of nominees with Wall Street experience,” Warren said. “But we need a balance. Not everyone who swoops in through the revolving door should be offered a top job without some serious examinations. Qualifications matter and Weiss doesn’t have them.”

Ouch.

Instead, I’m going to have to hold my nose and vote for some corporate Democrat.

Unless Bernie Sanders run.

Run Bernie!!! Run!!!