Category: Corruption

Sex Abuse Victims Call For Investigation of Vatican by the Hague

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You know, for the past 150 years, the Vatican has been a religious institution masquerading as a nation state, and not it looks like it might bight them on the ass, because the cause of its victims has been forwarded to the International Criminal court in the Hague:

A group representing victims of sexual abuse by Catholic priests is asking the International Criminal Court to investigate Pope Benedict XVI and three senior cardinals for alleged crimes against humanity.

A New York-based legal charity says they failed to prevent child abuse.

A Vatican lawyer called the case a “ludicrous publicity stunt”.

The Roman Catholic Church has been rocked by a series of sex abuse cover-up scandals in recent years.

The Centre for Constitutional Rights (CCR), which is filing the complaint, says it has submitted more than 20,000 pages of evidence of crimes committed by Catholic clergy against children and vulnerable adults to the Hague-based court.

It is being supported by abuse victims in the United States, Germany, Belgium and the Netherlands.

“Crimes against tens of thousands of victims, most of them children, are being covered up by officials at the highest level of the Vatican,” said the CCR’s lawyer, Pam Spees.

“In this case, all roads really do lead to Rome.”

The International Criminal Court was set up nine years ago to deal with serious international crimes. It lists rape and sexual violence as crimes against humanity.

Time for the Church to fish or cut bait.

If they are a religion, then they do not have sovereign immunity, and, in the case of Rome, Italian prosecutors should be investigating them.

If they are a state, then it’s the Hague, Bitches.

I’ve Been Saying This for Years, But Who Listens to Me

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I’m shocked, shocked to find that gambling is going on here!

POGO has reviewed cases where private contractors have assumed government functions, and in the overwhelming majority of the cases (33 out of 35) federal employees were cheaper than contractors:

Executive Summary

Based on the current public debate regarding the salary comparisons of federal and private sector employees, the Project On Government Oversight (POGO)[1] decided to take on the task of doing what others have not—comparing total annual compensation for federal and private sector employees with federal contractor billing rates in order to determine whether the current costs of federal service contracting serves the public interest.

The current debate over pay differentials largely relies on the theory that the government pays private sector compensation rates when it outsources services. This report proves otherwise: in fact, it shows that the government actually pays service contractors at rates far exceeding the cost of employing federal employees to perform comparable functions.

POGO’s study analyzed the total compensation paid to federal and private sector employees, and annual billing rates for contractor employees across 35 occupational classifications covering over 550 service activities. Our findings were shocking—POGO estimates the government pays billions more annually in taxpayer dollars to hire contractors than it would to hire federal employees to perform comparable services. Specifically, POGO’s study shows that the federal government approves service contract billing rates—deemed fair and reasonable—that pay contractors 1.83 times more than the government pays federal employees in total compensation, and more than 2 times the total compensation paid in the private sector for comparable services.

Additional key findings include:

  • Federal government employees were less expensive than contractors in 33 of the 35 occupational classifications POGO reviewed.
  • In one instance, contractor billing rates were nearly 5 times more than the full compensation paid to federal employees performing comparable services.
  • Private sector compensation was lower than contractor billing rates in all 35 occupational classifications we reviewed.
  • The federal government has failed to determine how much money it saves or wastes by outsourcing, insourcing, or retaining services, and has no system for doing so.
POGO’s investigation highlights two basic facts about outsourcing government work to contractors. First, comparing federal to private sector compensation reveals nothing about what it actually costs the government to outsource services. The only analysis that will shed light on the true costs of government is that of contractor billing rates and the full cost of employing federal employees to perform comparable work. The Commission on Wartime Contracting in Iraq and Afghanistan recently completed a fundamental study of costs, and found that, in certain contingency operations, although savings resulted from hiring local or third-country nationals, military and civilian employees cost less than hiring American contractors.

Second, the federal government is not doing a good job of obtaining genuine market prices, and therefore the savings often promised in connection with outsourcing services are not being realized. The argument for outsourcing services is that, by outsourcing services on which the government holds a monopoly, free market competition will result in efficiencies and save taxpayer dollars. But our study showed that using contractors to perform services may actually increase rather than decrease costs to the taxpayers.

The big growth in the use in contractors began under the 1st Bush administration with his Secretary of Defense, Dick Cheney, being at the vanguard of such efforts.

And then he went to run Halliburton, where he got millions to help them get billions of the slush funds that he set up.

Private contracting was never about saving the taxpayer money, it was about two things: reducing the capabilities of the government (because guvment is ebil), and creating an opportunity for corruption and graft.

It turns out that there are some unlikely voices who might agree, specifically Senate Intelligence Committee Chair Diane Feinstein* and new CIA director David Petraeus, are calling for drastic reductions of the use of contractors by the intelligence community:

Sen. Dianne Feinstein (D-CA), who chairs the Intelligence Committee, pointed out the broken promise at a hearing Tuesday, noting that the intelligence community is not living up to a commitment to reduce private contractors by 5 percent a year.

“We had an agreement in 2009 to reduce [intelligence community] contractor numbers by 5 percent a year, but it’s clear that progress has not been maintained and sufficient cuts are not being made,” Feinstein told a joint-hearing of the House and Senate Intelligence Committees to assess progress in U.S. intelligence gathering and analysis over the last ten years.

The Office of the Director of National Intelligence reported that “core contractors,” meaning those who directly augment the government’s intelligence staffs, accounted for 23 percent of the total intelligence community workforce, down only 1 percent from the year before, Feinstein pointed out.

………

One week into his new role as CIA director, David Petraeus testified Thursday that contractors are at the top of his list of potential cuts in the new era of belt-tightening.

“Contractors – we’re looking very hard at that as one of the areas we can achieve some savings,” Petraeus said, recognizing the fact that many contractors have been devoted partners and have died in service to their country.

Nice to see some of the PTB getting a clue on this.

*Full disclosure, my great grandfather, Harry Goldman, and her grandfather, Sam Goldman were brothers, though we have never met, either in person or electronically.

Obama Loses Frank Rich

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For not prosecuting the banksters. This is significant because, as Matt Taibbi notes, was “one of Obama’s great supporters in the punditry world,” and Rich’s latest piece is positively brutal:

What haunts the Obama administration is what still haunts the country: the stunning lack of accountability for the greed and misdeeds that brought America to its gravest financial crisis since the Great Depression. There has been no legal, moral, or financial reckoning for the most powerful wrongdoers. Nor have there been meaningful reforms that might prevent a repeat catastrophe. Time may heal most wounds, but not these. Chronic unemployment remains a constant, painful reminder of the havoc inflicted on the bust’s innocent victims. As the ghost of Hamlet’s father might have it, America will be stalked by its foul and unresolved crimes until they “are burnt and purged away.”

After the 1929 crash, and thanks in part to the legendary Ferdinand Pecora’s fierce thirties Senate hearings, America gained a Securities and Exchange Commission, the Public Utility Holding Company Act, and the Glass-Steagall Act to forestall a rerun. After the savings-and-loan debacle of the eighties, some 800 miscreants went to jail. But those who ran the central financial institutions of our fiasco escaped culpability (as did most of the institutions). As the indefatigable Matt Taibbi has tabulated, law enforcement on Obama’s watch rounded up 393,000 illegal immigrants last year and zero bankers. The Justice Department’s bally­hooed Operation Broken Trust has broken still more trust by chasing mainly low-echelon, one-off Madoff wannabes. You almost have to feel sorry for the era’s designated Goldman scapegoat, 32-year-old flunky “Fabulous Fab” Fabrice Tourre, who may yet take the fall for everyone else. It’s as if the Watergate investigation were halted after the cops nabbed the nudniks who did the break-in.

………

The fallout has left Obama in the worst imaginable political bind. No good deed he’s done for Wall Street has gone unpunished. He is vilified as an anti-capitalist zealot not just by Republican foes but even by some former backers. What has he done to deserve it? All anyone can point to is his December 2009 60 Minutes swipe at “fat-cat bankers on Wall Street”—an inept and anomalous Ed Schultz seizure that he retracted just weeks later by praising Dimon and Lloyd Blankfein as “very savvy businessmen.”

Obama can win reelection without carrying 10021 or Greenwich in any case. The bigger political problem is that a far larger share of the American electorate views him as a tool of the very fat-cat elite that despises him. Given Obama’s humble background, his history as a mostly liberal Democrat, and his famous résumé as a community organizer, this would also seem a reach. But the president has no one to blame but himself for the caricature. While he has never lusted after money—he’d rather get his hands on the latest novel by Morrison or Franzen—he is an elitist of a certain sort. For all the lurid fantasies of the birthers, the dirty secret of Obama’s background is that the values of Harvard, not of Kenya or Indonesia or Bill Ayers, have most colored his governing style. He falls hard for the best and the brightest white guys.

………

Obama soon retreated into the tea-party mantra of fiscal austerity. Short-term spending cuts when spending is needed to create jobs make no sense economically. But they also make no sense politically. The deficit has never been a top voter priority, no matter how loudly the right claims it is. At Obama’s inaugural, Gallup found that 11 percent of voters ranked unemployment as their top priority while only 2 percent did the deficit. Unemployment has remained a stable public priority over the deficit ever since, usually by at least a 2-to-1 ratio. In a CBS poll immediately after the Democrats’ “shellacking” of last November—a debacle supposedly precipitated by the tea party’s debt jihad—the question “What should Congress concentrate on in January?” yielded 56 percent for “economy/jobs” and 4 percent for “deficit reduction.”

Geithner has pushed deficit reduction as a priority since before the inauguration, the Washington Post recently reported in an article greeted as a smoking gun by liberal bloggers. But Obama is the chief executive. It’s his fault, no one else’s, that he seems diffident about the unemployed. Each time there’s a jolt in the jobless numbers, he and his surrogates compound that profile by farcically reshuffling the same clichés, from “stuck in a ditch” to “headwinds” (first used by Geithner in March 2009—retire it already!) to “bumps in the road.” It’s true the administration has caught few breaks and the headwinds have been strong, but voters have long since tuned out this monotonous apologia. The White House’s repeated argument that the stimulus saved as many as 3 million jobs, accurate though it may be, is another nonstarter when 14 million Americans are looking for work.

………

(emphasis mine)

If he’s losing (possibly already lost) someone like Frank Rich, who was  treating like the 2nd coming, he’s losing a lot of people.

About the only silver lining for this is that Rich, unlike myself, or Yves Smith, is unwilling to call him and his administration corrupt over this.

Oh Crap

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As Dave Weigel, notes, “Pennsylvania Ponders Bold Democrat-Screwing Electoral Plan,” which would serve to award most of the states electoral votes to the Republican regardless of the vote count:

Laura Olson reports on the happenings in Harrisburg, where Republicans now control all of the branches of government:

Senate Majority Leader Dominic Pileggi is trying to gather support to change the state’s “winner-takes-all” approach for awarding electoral votes. Instead, he’s suggesting that Pennsylvania dole them out based on which candidate wins each of the 18 congressional districts, with the final two going to the contender with the most votes statewide.

In other reports, Pileggi sounds awfully sanguine about the effect this would have on PA as a swing state. Why even bring that up? Pennsylvania is typically a closely-divided state, and while it’s gone Democratic in every election since 1992, it’s been heavily campaigned-in every year.

So, let’s pretend this is a totally political neutral decision. If the next Republican candidate breaks the streak and wins the state, it would be horrible for him — he’d shed electoral votes. But if the president wins, he’s down at least nine, possibly ten electoral votes, because congressional districting is slanted towards the GOP.

When Democrats come to power, they try to do things and mend fences, and when Republicans come to power, they try to tear things down and use the political process in the relentless pursuit of power.

Considering that the American public generally considers Terri Schiavo to have better ideas to Republicans, but they remain competitive politically seems to indicate that they play the game a lot better than the Democrats do.

I think that it’s likely to happen, the idea of shaming Republicans into doing the right thing is laughable, though there is opposition, both from the Pennsylvania Republican Congressional delegation, as well as people who feel that the state would be ignored, as it would lose its swing state status.

Another Nail in the Bank Sellout Settlement Deal Coffin

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Minnesota Attorney General Lori Swanson has sent a letter to the Attorneys General of New York and Iowa (The Iowa AG is leading the negotiations) saying that any settlement that grants immunity to the banks on areas that have not been thoroughly investigated will be unacceptable to her:

In a letter sent to the attorneys general of New York and Iowa on Friday, Minnesota Attorney General Lori Swanson said that banks shouldn’t be protected from liability in connection with the nationwide foreclosure settlement.

Swanson said that banks should not be released from liability for mortgage securitization, securities claims or the use of a mortgage registry known as MERS, Bloomberg News reported.

“The banks should not be released from liability for conduct that has not been investigated and is not appropriately remedied in any settlement,” Swanson wrote, according to Bloomberg News.

State and federal officials are negotiating a settlement with the five largest mortgage services in the U.S. – Bank of America Corp., Wells Fargo & Co., JP Morgan Chase & Co., Citigroup Inc. and Ally Financial Inc.

I think that it has become increasingly clear to people involved with the negotiations that Iowa Attorney General Tom Miller and the Obama administration are primarily interested in shielding the banks, and creating the appearance rather than the reality of accountability for the banksters.

Note also that Swanson has some serious consumer protection cred, as she was the one who uncovered the fraudulent and self dealing behavior of the National Arbitration Forum, and forced the organization out of consumer arbitration.

I don’t think that there has been an outbreak of ethics in the case of the banks, it’s just that the AGs who oppose this deal realize that not only are the settlement talks a corrupt endeavor, but they are a transparently corrupt endeavor, and they don’t think that they can defend it to the voters.

Signs of the Apocalypse: Alphonse “Da Woim” D’amato Wants the Banks Prosecuted

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He’s come out against the big banks and for New York Attorney General Eric Schneiderman:

New York state’s attorney general, Eric Schneiderman, is making national news regarding his opposition to a nationwide $20 billion foreclosure settlement involving some of the largest banks over questionable foreclosure practices and mortgage abuses.

While I didn’t support Schneiderman in the 2010 election, he deserves to be applauded for standing up to the big banks and some of the questionable practices that have attributed to America’s economic downturn.

Last Oct. 13, the attorneys general from all 50 states announced that they would join forces to investigate the bank foreclosure practices after there were several reports of faulty documents being used in the seizure of homes. Thirteen of the attorneys general serve on an executive committee, working with the Department of Justice and various other federal agencies to negotiate a settlement with the five largest mortgage servicers in the United States: Bank of America, JP Morgan Chase, Citigroup, Wells Fargo and Ally Financial.

Shaun Donovan, the secretary of housing and urban development, and other members of the Obama administration have been pressuring Schneiderman to go along with and support the settlement. It has been an intense campaign to change our attorney general’s mind.

Schneiderman has held his ground, and throughout the negotiations maintained the belief that the proposed $20 billion, which would mostly be designated to pay for loan modifications instead of going directly to Americans who were harmed by the banks’ practices, was not enough money. Also, if the banks and executive committee reached an agreement, it would prevent any further litigation or investigations against the large banks.

As a result of Schneiderman’s holdout, on Aug. 24 it was reported that he was “removed from a leadership role in negotiating a nationwide foreclosure settlement with U.S. banks.”
Iowa Attorney General Tom Miller, who is heading the executive committee, accused Schneiderman of “actively working to undermine the very same multistate group that it had spent the previous nine months working very closely with.”

Bravo, Mr. Attorney General!

………

By pressuring the attorneys general’s executive committee to pass this fruitless proposal, President Obama and his administration are allowing the big banks, generous campaign contributors, to once again get away unscathed for their chancy and untrustworthy practices. In times like these, we need leaders like Schneiderman to challenge the big banks, making sure that victims receive justice and restitution and that overall reform changes the mortgage industry.

To allow a settlement to be reached that hinders future investigations into large banks’ foreclosure and mortgage practices is criminal. Fight on, Mr. Attorney General.

I don’t think that Mr. D’Amato’s motives are completely benign: As a Republican, he has vested interest in criticizing the Obama administration, and has never been particularly interested in pursuing corruption.

What he does know is how to pander to his constituents, and he clearly sees the enthusiastic embrace of Wall Street, and explicit toleration of its endemic corruption, by the Obama administration to be a political miss-step.

I agree, and I would further add that it’s also good policy, as we are creating moral hazard by not prosecuting the banksters.

The Term for This Is Chillul Hashem*

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In this case, it’s “Rabbi” Moshe Zigelman, who is refusing to testify in a money laundering and tax evasion trial:

As U.S. District Judge Margaret Morrow contemplated federal law from her bench Wednesday morning, more than a dozen ultra-orthodox Jewish men with yarmulkes and sidelocks looked on in the courtroom. One held open a gilt-edged, elaborately embossed copy of the Shulchan Aruch, a book of Jewish law, tracing lines of the Hebrew text with his finger.

Appearing before the judge was Rabbi Moshe Zigelman, a 64-year-old devout Hasid who was refusing to testify before a federal grand jury, citing an ancient Jewish principle that forbids informing on other Jews.

Zigelman was ordered to testify in a tax-evasion case involving his Brooklyn-based Hasidic sect Spinka. He had earlier invoked the same principle, known as mesira, when he pleaded guilty to his part in the scheme in 2008 but refused to cooperate with authorities or testify in trial. He was sentenced to two years in prison.

What was going on here is that they were accepting “donations”, which the donors declared on their taxes, and then, after taking about 10-20% vigorish, they funneled funds back to the donors via an Israeli bank.(Wiki here)

First, lets be clear that clergy privilege does not apply here. This creep was a co-conspirator, not someone providing counseling.

What’s more, according to Shmarya Rosenberg’s excellent analysis, as well as those of normative Jewish scholars, mesira does not apply:

There are textbook exceptions to mesira even for those who hold that mesira applies in a democracy.

One of those exceptions is when the government knows certain people are guilty but needs testimony from one of them or another Jew to convict or capture the others. (In other words, there is a difference between speculation and knowledge.

Another exception is when refusing to give the government the information makes it seem as if Jews (or Orthodox Jews) do not follow or respect the country’s laws.

Hasidim use mesira to hide crimes and to enforce order in their communities.

It has nothing to do with the original intent of the mesira law, which was meant to save Jews from unjust punishments meted out by antisemitic governments, and from the unscrupulous Jews who used informing to hurt business opponents and social enemies, to extort them, and to gain favor from antisemitic government officials.

But in a democracy like the US, the fear of antisemitic unjust punishments does not apply.

The law of mesira would then only apply to spiteful informing done to settle personal grudges and the like, and it would not apply if the government was already convinced the subject is guilty.

In Rabbi Moshe Zigelman’s case, the government already knows Zigelman is guilty of money laundering, and it has already put the Spinka rebbe and others in prison. And it knows there are dozens, if not hundreds, of other co-conspirators, and it knows many of their names.

This is actually far more charitable than I would be.

Zigelman is not just a witness, he is an active co-conspirator, who is using mesira to cover his own corrupt tuchas.†

It is also, of course a Shanda before the Goyim, in that it allows the antisemites of the world to claim that Jews consider themselves above the law and cover up for each other.

This makes a mockery of the concept of Or LaGoyim,‡, which stipulates that Jews are to be held to higher standards, and not cover up each others corruption.

*Literally, a ““Desecration of God’s Name.”
†Ass.
‡Light unto the nations.

Hoocoodanode? The Frogs, That’s Hoocoodanode

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Yes, Wikileaks, the gift that keeps on giving,™ has yet more beneath the rocks information on just how f%$#ed up Wall Street was.

It turns out that the French were desperately warning the US Treasury Department that a crash was inevitable, because of endemic fraud in our financial system:

In 2007 top US and France officials knew rampant fraud being committed by regulators, rating agencies and Wall Street Banks would soon cause a global financial collapse.

While investors and nations around the world were happily giving trillions of dollars away to crooked Wall Street bankers top officials in the United States and France knew the market would soon collapse and people would be robbed of millions.

While raising the issue that the role of government regulators and rating agencies needed to be reviewed in the wake of the upcoming crisis, US officials ignored calls from the French government to enact necessary regulation to stop the rampant fraud that would soon result in investors losing tens of trillions of dollars they had invested into the markets.

The cable reveals that while discussing the ability of the French banks to survive the crisis, French President Sarkozy was pushing the US to enact regulations to forestall the crisis. Instead, Henry Paulson responded by telling Sarkozy not to overreacted because the” it would take months, not weeks, for credit to be re-priced” telling France this is “not a major crisis.”

Paulson went on to warn that the major problem was with the German banks and which would require a bailout from the taxpayer while warning that the assets held by banks but covered up from investors by being held off-balance sheet presented systematic risk to banks and to sovereign wealth.

The cable clearly reveals that taxpayer bailouts would be needed. Paulson further up sticks up for the Wall Street hedge fund saying they were not to blame for the crisis while acknowledging there were major Wall Street transparency issues.

To summarize, the cable reveals that top government officials in France and the US knew Wall street banks were committing fraud in the origination and packaging of sub-prime mortgage and lying to investors about the resulting securities they were creating and selling. Officials knew banks were also lying about their own liabilities and hiding them from investors by keeping the assets off their balance sheets. The government also knew that both regulators and ratings agencies were participating in the scheme.

So our regulatory apparatus was aware of deep and systemic control fraud on the part of our largest financial institutions over a year before the house of cards collapsed, but decided to do nothing.

This was no Black Swan.  This was a blatant and systemic looting of the system, with implicit taxpayer backstop.

Where are the prosecutions?

As an aside, the most tightly held secrets held by our state security apparatus are not about protecting the nation and its citizens, but rather about protecting the most powerful amongst us from embarrassment and ridicule.

We really need to embed the Swedish concept of Offentlighetsprincipen (openness) into our constitution.

H/t DC on the Stellar Parthenon BBS.

Meet the New Boss, Same As the Old Boss

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What can I say, but, “Let’s see some windmill chords”

Obama just killed the EPA’s attempt to make our air cleaner:

President Barack Obama today directed EPA to drop its highly controversial effort to set, under the auspices of the Clean Air Act, more stringent standards for ground-level ozone pollution, a key constituent of smog. Obama cited the need to reduce regulatory burdens and uncertainty among the business community in light of the struggling economy.

“With that in mind, and after careful consideration, I have requested that [EPA Administrator Lisa P. Jackson] withdraw the draft Ozone National Ambient Air Quality Standards at this time,” the President said.

The Clean Air Act requires EPA to review the standards for ground-level ozone once every five years. The standards include a “primary” standard for protecting public health and a “secondary” one aimed at safeguarding crops and the environment.

In 2008, the George W. Bush Administration set both standards at 75 ppb. But In January 2010, Jackson proposed tightening the standards to somewhere between 60 and 70 ppb, a range recommended by the agency’s scientific advisory committee.

Obama noted that the current ozone standard is due for review and possible revision again in two years.

It appears that there is not a single bit of Bush administration malfeasance that Obama won’t go to the wall to support.

What’s a few thousand dead kids and seniors over the prospect of a few million dollars in campaign contributions from polluters, after all?

The Schadenfreude Shortage is Officially Over

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After Bill O’Reilly and his wife separated, she started dating a cop, and he used the promise of donations to a police charity to get the police commissioner to order an investigating his wife’s boyfriend:

Last summer, Fox News anchor Bill O’Reilly came to believe that his wife was romantically involved with another man. Not just any man, but a police detective in the Long Island community they call home. So O’Reilly did what any concerned husband would do: He pulled strings to get the police department’s internal affairs unit to investigate one of their own for messing with the wrong man’s lady.

We reported in June that Bill O’Reilly and his wife of 15 years Maureen McPhilmy O’Reilly seem to be on the outs. Last summer she purchased a separate home under her own name, and transferred her voter registration to the new address, while O’Reilly kept his registration current at their old address. As per usual, Fox News did not comment on the situation at the time. Since then we’ve learned what happened, and it’s like Bridges of Madison County meets Copland. When confronted with a potentially disloyal spouse, O’Reilly reacted by—not unlike his boss Roger Ailes—treating his local police department like a private security force and trying to damage one cop’s career for the sin of crossing Bill O’Reilly.

………

Richard Harasym is a 23-year veteran of the Nassau County Police Department who, as of last summer, had been a detective in the elite internal affairs unit for 12 years. His job was to catch crooked cops, root out corruption, and police the police. But at some point during the summer of 2010, his commanding officer, Inspector Neil Delargy, called him into his office with a highly unorthodox assignment: Harasym was to launch an investigation into a fellow officer based not on what he had done, but on who he was dating.

Delargy ordered Harasym to meet with two private detectives working on behalf of Bill O’Reilly. They had information about an NCPD officer they believed to be carrying on with O’Reilly’s wife. Delargy told Harasym to launch an investigation into the man and to tell him to end the relationship.

………

According to our source, Delargy offered Harasym no justification for investigating the detective—who is unmarried—aside from the alleged infidelity. “The order was to investigate this detective not for any misdeeds,” the source said, “but to see if they could get anything on him. Delargy also told him to tell the detective to back off.”

Delargy told Harasym that the investigation was highly sensitive for two reasons, the source said: 1) It was ordered directly by then-police commissioner Lawrence Mulvey, and 2) O’Reilly was at the time considering making a major donation to the Nassau County Police Department Foundation, a private not-for-profit foundation Mulvey helped found in 2009 to raise money for construction of a planned $48 million police training facility at Nassau Community College.

“These internal affairs cops were on the case at the behest of Mulvey in order to get O’Reilly’s funds,” the source said.

I don’t know from the story if Billo broke any laws here.  In order for him to have broken the law, he would have had make statements implying that there would be no donation forthcoming unless they targeted his wife’s boyfriend, but with allegations that Mulvey routinely offered favors to people who made donations to his charity, it does seem that there is some serious ethical lapses.

The fact that this mirrors Newscorp’s payoffs to in matters related to the phone hacking scandal in the UK makes it even more amusing.

I think that I will have a surfeit of schadenfreude to last me through September.

Yes, that Acquisition of Countrywide was So Good for BoA

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I probably haven’t been writing about this as much as I should, but it’s beginning to look like Bank of America’s ill-advised takeover of Countrywide Financial, and it’s portfolio of fraudulent mortgages, is beginning to cause some real problems.

Basically, the sweetheart deal that they negotiated with the trustee, Bank of New York Mellon, would have them paying out pennies on the dollar for misrepresented and mis-documented mortgages.

First, New York Attorney General Eric Schneiderman opposed the settlement saying that it was unfair to investors.

Of course, the unfairness was a feature, not a bug, since BNY Mellon is desperate to reduce its exposure from their deliberate lack of due diligence.

Then, the FDIC opposed the deal, saying that they did not have enough information to evaluate the deal on its merits.

And if we know anything about the world of securitized mortgages and trusts, we know that more information means more bad news, as we have seen every time another rock gets overturned.

Well, now we have individual homeowners filing to block the settlement, because, as a sop to investors, the deal would have established a “rocket docket” for foreclosures:

Lawyers for the National Consumer Law Center said in a report prepared as part of the case that the proposed settlement “will speed up foreclosures, perpetuate existing servicing abuses in the system, and undermine federal programs designed to stabilize the housing market.”

Bank of America had hoped the $8.5 billion settlement would finally put much of this potential liability behind it, but the challenges have raised investor fears that the ultimate cost of the settlement could rise sharply. Anxiety about the extent of Bank of America’s legal woes has also weighed on the bank’s stock, with some estimates suggesting the ultimate cost could be in the tens of billions.

First, I think that the penalties, including tax penalties for improperly conveying the mortgages to the trust, are almost certainly in the hundreds of billions of dollars, and second, when an $8.5 billion payout is a sweetheart deal, it means that the banks are too big.

Oh, yeah, and I almost forgot: The FHFA filed a similar objection to the FDIC’s and U.S. Bancorp is suing to get BOA to buyback the mortgages in yet another trust.

BoA would be, in a fair and just world, toast, and its executives would be facing criminal investigations.

In this world, however, it means that Obama and Geithner and Bernanke will be setting up someway to bail them out in order to insure executive bonuses “protect the banking system” with our money.

H/t Naked capitalism.

On edit:

It looks like the Nevada is claimed that BoA reneged on its loan modification agreement with the state, and so they are filing to abrogate the agreement so that they can sue:

The attorney general of Nevada is accusing Bank of America of repeatedly violating a broad loan modification agreement it struck with state officials in October 2008 and is seeking to rip up the deal so that the state can proceed with a suit against the bank over allegations of deceptive lending, marketing and loan servicing practices.

In a complaint filed Tuesday in United States District Court in Reno, Catherine Cortez Masto, the Nevada attorney general, asked a judge for permission to end Nevada’s participation in the settlement agreement. This would allow her to sue the bank over what the complaint says were dubious practices uncovered by her office in an investigation that began in 2009.
In her filing, Ms. Masto contends that Bank of America raised interest rates on troubled borrowers when modifying their loans even though the bank had promised in the settlement to lower them. The bank also failed to provide loan modifications to qualified homeowners as required under the deal, improperly proceeded with foreclosures even as borrowers’ modification requests were pending and failed to meet the settlement’s 60-day requirement on granting new loan terms, instead allowing months and in some cases more than a year to go by with no resolution, the filing says.
The complaint says such practices violated an agreement Bank of America reached in the fall of 2008 with several states and later, in 2009, with Nevada, to settle lawsuits that accused its Countrywide unit of predatory lending. As the credit crisis grew, the settlement was heralded as a victory by state offices eager to help keep troubled borrowers in their homes and reduce their costs. Bank of America set aside $8.4 billion in the deal and agreed to help 400,000 troubled borrowers with loan modifications and other financial relief, such as lowering interest rates on mortgages.

I wish that I knew of a way to go short on the bad news piling up, and long on the eventual bailout.

Jury Pushes Back Against the Police State

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A stripper attempted to file a sexual harassment complaint against a Chicago police officer, and when she approached Internal Affairs, instead of making an effort to investigate the allegations, they attempted to get her to withdraw their complaint.

In response, she taped their malfeasance, and the response of the District Attorney was to charge her with a felony.

Thankfully, the jury realized that this was yet another attempt to exempt police from any sort of public scrutiny, and acquitted her:

A former stripper, who secretly recorded two Chicago Police Internal Affairs investigators while filing a sexual harassment complaint against another officer was acquitted on eavesdropping charges Wednesday.But why the f%$# did the reporter feel it germane to the story.

She alleged that she was fondled by a cop on a domestic abuse call.Why the hell is this in the story/

It doesn’t matter if she was a freaking nun, or a lobbyist, it was a damn domestic abuse call, and there were allegations of sexual harrassment.

“I’m feeling a lot better now,” a smiling Tiawanda Moore said after a Cook County jury returned the verdict in a little over an hour.
The 20-year-old Indiana woman admitted she taped the officers on her Blackberry in August of last year. But she said she only did it because the investigators were coaxing her to not go forward with her complaint.
“I wanted him to be fired,” Moore testified of the cop she alleges fondled her and gave her his phone number during a domestic battery call at the South Side residence she sometimes shares with her boyfriend.
Moore said she didn’t know about the Illinois Eavesdropping Act, which prohibits the recording of private or public conversations without the consent of all parties. Even so, Moore’s attorney, Robert Johnson, said his client was protected under an exemption to the statute that allows such recordings if someone believes a crime is being committed or is about to be committed.
The Internal Affairs officers were “stalling, intimidating and bullying her,” Johnson said. The recording, which was played in court during the one-day trial, proved it, Johnson said.
Assistant State’s Attorney Mary Jo Murtaugh told jurors, “The content of the tape is not the issue. The issue is that the words were taped.”

No, the IA officers were conspiring to conceal an alleged crime, and as such they were engaging in conspiracy, abuse of office, and probably a few dozen other crimes that someone better versed in the law would be aware of.

But Ed Yohnka, spokesman for the American Civil Liberties Union of Illinois, said the verdict “reflects a repudiation of the eavesdropping law in Illinois. Clearly, the public believes that individuals should be able to record police engaged in their public duties, in a public space in an audible voice.”

Your mouth go God’s ear, Mr. Yohnka.

There is a word for societies where law abiding citizens are prosecuted for uncovering and revealing police corruption, and that work is police state

Michelle Rhee Gets Called Out By NY Times

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It seems that the Gray Lady has noticed Michelle Rhee is frantically avoiding any discussion of the cheating that occurred under her watch as Chancellor for the DC Schools:

Eager for Spotlight, but Not if It Is on a Testing Scandal
By MICHAEL WINERIP

WASHINGTON — Why won’t Michelle Rhee talk to USA Today?

Ms. Rhee, the chancellor of the Washington public schools from 2007 to 2010, is the national symbol of the data-driven, take-no-prisoners education reform movement.

It’s hard to find a media outlet, big or small, that she hasn’t talked to. She’s been interviewed by Katie Couric, Tom Brokaw and Oprah Winfrey. She’s been featured on a Time magazine cover holding a broom (to sweep away bad teachers). She was one of the stars of the documentary “Waiting for Superman.”

These days, as director of an advocacy group she founded, StudentsFirst, she crisscrosses the country pushing her education politics: she’s for vouchers and charter schools, against tenure, for teachers, but against their unions.

Always, she preens for the cameras. Early in her chancellorship, she was trailed for a story by the education correspondent of “PBS NewsHour,” John Merrow.

At one point, Ms. Rhee asked if his crew wanted to watch her fire a principal. “We were totally stunned,” Mr. Merrow said.

She let them set up the camera behind the principal and videotape the entire firing. “The principal seemed dazed,” said Mr. Merrow. “I’ve been reporting 35 years and never seen anything like it.”

And yet, as voracious as she is for the media spotlight, Ms. Rhee will not talk to USA Today.

So the press is beginning to notice that the publicity hound is avoiding them.

Perhaps they should look more closely at her stories, because even a cursory examination of her record reveals that she consciously juiced those numbers through her official actions:

This conclusion is premature. A review of the record shows that Michelle Rhee’s test score “legacy” is an open question.

There are three main points to consider:

  • First, (by Rhee’s own admission) two simple policy changes enacted in 2007 were made, in part, to generate artificial test score gains during her first year (when roughly 75 percent of the DC-CAS increases occurred).
  • Second, the district’s DC-CAS test was introduced in 2006, and a year or two after any new test is introduced – as students, teachers, and administrators become more familiar with it – it’s common to see an artificial inflation in scores. The beginning of Rhee’s tenure coincided with this period. 
  • Third, the students enrolled in DC public schools in 2010 were a significantly different group compared with the students of 2007, and this demographic shift may have driven some of the improvement in DC-CAS performance. A deeper look at the best evidence we have – from the National Assessment of Education Progress (NAEP) – suggests that the increases in D.C.’s average NAEP scores between 2007 and 2009 (widely touted by Rhee and her supporters as confirmation of her effectiveness) could, in part, be a result of this demographic change. Math increases may be somewhat overstated, while reading scores may have been flat.

This is not particularly surprising.  The educational reform establishment (an bit of an Orwellian concept) is all about finding a way to turning the education system into a for-profit Education-Industrial Complex, and no one would stand for it if they heard the truth.

Let’s hope that the worm turns for Michelle Rhee and their corrupt ilk like it has for Alan “Bubbles” Greenspan.

Remember when Obama ran these f%$#ers over the coals? Remember when BP execs were clapped in irons and given life sentences for crimes against humanity?

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Me neither.*

In case you are wondering, why yes, the Deepwater Horizon is spilling oil again:

Oil is once again fouling the Gulf of Mexico around the Deepwater Horizon well, which was capped a little over a year ago.

Tuesday afternoon, hundreds of small, circular patches of oily sheen dotted the surface within a mile of the wellhead. With just a bare sheen present over about a quarter-mile, the scene was a far cry from the massive slick that covered the Gulf last summer.

Floating in a boat near the well site, Press-Register reporters watched blobs of oil rise to the surface and bloom into iridescent yellow patches. Those patches quickly expanded into rainbow sheens 4 to 5 feet across.

Each expanding bloom released a pronounced and pungent petroleum smell. Most of the oil was located in a patch about 50 yards wide and a quarter of a mile long.

Because playing nice with the least safety conscious energy company in the western world is such a winning strategy.

Not feeling that “Audacity of Hope”.

There is a difference between dealing with people who merely disagree with you, and dealing with evil ratf%$#s who will destroy everything for a few pennies.

BP’s upper management is clearly the latter, and dealing with them as the former just makes things worse.

*H/T JR at the Stellar Parthenon BBS for the title and the first line.

I Thought That I Had Already Posted This

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Former Luzerne County Court Judge Mark A. Ciavarella Jr., who took bribes from private prison companies to send kids to jail, was sentenced to 28 years in jail:

As his moment of sentencing drew near Thursday, former Luzerne County Court Judge Mark A. Ciavarella Jr. was still trying to minimize his crimes. No way, he said, had he sold “kids for cash.”

The prosecutor would have none of it.

“In essence, Mr. Ciavarella’s argument is, ‘I was not selling kids retail,’ ” Assistant U.S. Attorney Gordon A.D. Zubrod said. “We agree with that. He was selling them wholesale.”

Minutes later, U.S. District Judge Edwin M. Kosik slammed Ciavarella, 61, with 28 years in prison. It appeared to be the longest federal prison sentence ever given in a U.S. political corruption case.

In the Scranton area, Ciavarella was a key target among many in a sweeping and still-ongoing federal corruption probe. Prosecutors have brought charges against nearly 30 officials, including two other judges, numerous court officials, a former state senator, school board members, and county officials.

(emphasis mine)

It may be a record long sentence, but it is not long enough.

His partner in crime, county president judge Michael T. Conahan, has already pled guilty, and is awaiting sentencing.

Hopefully, he gets a sentence of similar length.

While We Are On the Subject of Bank of America

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When you offer a bribe, make sure that the mic is not live

Look at the video for this gem. A representative of Bank of America walks up to Rick Perry, and says, “Bank of America… We will help you out”.

It turns out that be Bank Of America’s director of public policy, James Mahoney.

Nope, no quid pro quo here, BoA has released a statement saying that, “Bank of America does not endorse Presidential candidates. The reference was about following up on the substance of the speech about job creation and economic growth.”

Yeah, we believe you, and we believe it when you say that MERS properly recorded mortgages, and that you f%$#s didn’t pay off the ratings agencies to rate your garbage as AAA,

H/t Cthulhu.*

*No, not the unspeakably malevolent super-being, the contributor to the Stellar Parthenon BBS.†
†OK, I’ve never seen the two of them together, so Cthulhu might actually be the Cthulhu, but the mere fact that he is on a BBS, interacting with humans‡ would seem to mitigate against this.
‡Yes, I know, this is the internet, where no one knows if you are a dog.

Obama Admin Pressuring NY AG Schneiderman to Drop Bank Investigations

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We are getting leaks that the Obama administration is going full bore to prevent New York State Attorney General from doing a thorough and diligent investigation of the banksters mortgage fraud:

Eric T. Schneiderman, the attorney general of New York, has come under increasing pressure from the Obama administration to drop his opposition to a wide-ranging state settlement with banks over dubious foreclosure practices, according to people briefed on discussions about the deal.

In recent weeks, Shaun Donovan, the secretary of Housing and Urban Development, and high-level Justice Department officials have been waging an intensifying campaign to try to persuade the attorney general to support the settlement, said the people briefed on the talks.

Mr. Schneiderman and top prosecutors in some other states have objected to the proposed settlement with major banks, saying it would restrict their ability to investigate and prosecute wrongdoing in a variety of areas, including the bundling of loans in mortgage securities.

But Mr. Donovan and others in the administration have been contacting not only Mr. Schneiderman but his allies, including consumer groups and advocates for borrowers, seeking help to secure the attorney general’s participation in the deal, these people said. One recipient described the calls from Mr. Donovan, but asked not to be identified for fear of retaliation.

So, not only are they pressuring Schneiderman, but they are trying to gin up an AstroTurf response to further intimidate him.

I’m with what Yves Smith said, “It is high time to describe the Obama Administration by its proper name: corrupt.” (emphasis mine)

What’s more, he’s also catching flack from the in the person of Kathryn Wylde, Deputy Chair of the New York Bank of the Federal Reserve, who accosted him at a memorial service

Representatives for the four big banks declined to comment. Mr. Schneiderman has also come under criticism for objecting to a settlement proposed by Bank of New York Mellon and Bank of America that would cover 530 mortgage-backed securities containing Countrywide Financial loans that investors say were mischaracterized when they were sold.

The deal would require Bank of America to pay $8.5 billion to investors holding the securities; the unpaid principal amount of the mortgages remaining in the pools totals $174 billion. Lawyers representing 22 institutional investors, including the Federal Reserve Bank of New York, BlackRock and Pimco, contended that the deal was favorable.

This month, Mr. Schneiderman sued to block that deal, which had been negotiated by Bank of New York Mellon as trustee for the holders of the securities. The lawsuit contends that the deal could “compromise investors’ claims in exchange for a payment representing a fraction of the losses” experienced by investors and that it had been negotiated without the knowledge of all of the holders of the securities.

The lawsuit angered Bank of New York Mellon, and as Mr. Schneiderman was leaving the memorial service last week for Hugh Carey, the former New York governor who died Aug. 7, an attendee said Mr. Schneiderman became embroiled in a contentious conversation with Kathryn S. Wylde, a member of the board of the Federal Reserve Bank of New York who represents the public. Ms. Wylde, who has criticized Mr. Schneiderman for bringing the lawsuit, is also chief executive of the Partnership for New York City. The New York Fed has supported the proposed $8.5 billion settlement.

Other investors in the Countrywide mortgage pools who were not part of the settlement talks between Bank of New York Mellon and Bank of America have called the terms inadequate.

Characterizing her conversation with Mr. Schneiderman that day as “not unpleasant,” Ms. Wylde said in an interview on Thursday that she had told the attorney general “it is of concern to the industry that instead of trying to facilitate resolving these issues, you seem to be throwing a wrench into it. Wall Street is our Main Street — love ’em or hate ’em. They are important and we have to make sure we are doing everything we can to support them unless they are doing something indefensible.”

(emphasis mine)

Defrauding investors and home buyers is defensible?

I’m with Barry Ritholtz, who has called for Wylds’s resignation:

If the Times report is accurate, and the quote below [it;s the last paragraph above quote] represents Ms. Wylde’s comments, than that position is a laughable mockery, and Ms. Wylde should resign effective immediately.

…………

But what is surprising is the utterly inappropriate behavior of Kathryn S. Wylde. She is not only a member of the board of the Federal Reserve Bank of New York, but occupies the seat supposedly reserved for the representing the public.

If the Times report is accurate, and the quote below represents Ms. Wylde’s comments, than that position is a laughable mockery, and Ms. Wylde should resign effective immediately.

(emphasis mine)

In any case, if you want to contact the AG and tell him not to back off, you can call (800) 771-7755 or at (212) 416-8000) or use his e-mail form.

This is particularly recommended.

BTW, if you live in Delaware, you might want to drop a dime on Beau Biden, the VP’s son, and Delaware’s AG, who has joined with Schneiderman in opposing the BoA deal.

If the Fed and the Obama administration are dead set on any sort of meaningful reform or accountability for the banks, then we need back up the State Attorneys General to pursue the banksters.

[on edit]

The AGs or Massachusetts and Nevada are also balking on the settlement offer, and considering that Nevada has probably the worst foreclosure problems in the nation, it makes any settlement even more problematic.

It Looks Like Gaddafi is Out

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Or will be in a matter of hours.

I was listening to NPR, and they were hoping that the rebels would not go medieval on former Gaddafi loyalists, but that is a pipe dream.

They have no credibility, because they were installed largely as the result of direct military action by NATO, which requires the widespread application of violence against any potential opposition.

Additionally, because they are effectively clients of big oil and finance NATO, they will have to aggressively implement “free market reforms”, which means the end of their publicly financed healthcare and education systems, as well as signing sweetheart deals with big oil, which will not be supported by the general populace.

It’s good that Gaddafi is gone, but because he was removed through what was essentially a colonial intervention, the new regime will for the foreseeable future be a colonial administration, which may in the long run prove worse for the average Libyan.

Unsurprising News About the Ratings Agencies

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I’m shocked, shocked to find that gambling is going on here!

A former senior VP at Moody’s has written a detailed layer to the SEC alleging that the ratings agency systematically pressured analysts to uprate crappy derivatives:

A former senior analyst at Moody’s has gone public with his story of how one of the country’s most important rating agencies is corrupted to the core.

The analyst, William J. Harrington, worked for Moody’s for 11 years, from 1999 until his resignation last year.

From 2006 to 2010, Harrington was a Senior Vice President in the derivative products group, which was responsible for producing many of the disastrous ratings Moody’s issued during the housing bubble.

Harrington has made his story public in the form of a 78-page “comment” to the SEC’s proposed rules about rating agency reform, which he submitted to the agency on August 8th. The comment is a scathing indictment of Moody’s processes, conflicts of interests, and management, and it will likely make Harrington a star witness at any future litigation or hearings on this topic.

His specific allegations:

  • Moody’s ratings often do not reflect its analysts’ private conclusions. Instead, rating committees privately conclude that certain securities deserve certain ratings–but then vote with management to give the securities the higher ratings that issuer clients want.
  • Moody’s management and “compliance” officers do everything possible to make issuer clients happy–and they view analysts who do not do the same as “troublesome.” Management employs a variety of tactics to transform these troublesome analysts into “pliant corporate citizens” who have Moody’s best interests at heart.
  • Moody’s product managers participate in–and vote on–ratings decisions. These product managers are the same people who are directly responsible for keeping clients happy and growing Moody’s business.
  • At least one senior executive lied under oath at the hearings into rating agency conduct. Another executive, who Harrington says exemplified management’s emphasis on giving issuers what they wanted, skipped the hearings altogether.

(emphasis original)

The fact that no senior manager on Wall Street has been indicted over this sort of behavior, and they continue to work, and continue to be criminally overpaid, fills me with despair.