Category: Corruption

About Bloody Time!!!!

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If you own a licensed version of MicroFlaccid’s Windows operating system, you have no doubt encountered the nagware program on Windows Genuine Advantage, which serves no purpose but to prevent unauthorized copies of the operating from being installed.

It should be noted that it also frequently locks people out with proper licenses, after they do things like replace a motherboard of a hard drive, and the installation of the upgrade is deceptive, saying that it provides system security, when what it really provides Microsoft with is revenue protection.

Well now, after discovering that the software phones home, a lawsuit has been filed against Microsoft as a purveyor of spyware:

A US lawsuit has alleged that Windows Genuine Advantage (WGA), Microsoft’s controversial anti-piracy software, is little better than spyware.

A lawsuit (which seeks class-action status) filed in Washington district court last week also cries foul over false advertising as well as allegations of privacy law violations, Electronista reports. More specifically, the suit alleges that the XP version of WGA was offered to users as a security update rather than as an anti-counterfeiting technology.

WGA phones home to Microsoft daily with IP address and other information on users. The latest lawsuit, like others against WGA before it, takes exception to this behaviour.

The case here is pretty easy to understand, so let’s look at what the program is and does, and compare it to spyware:

What WGA Does Is it Spyware
Does it install on your system without notifying you of what it does? Yes, it calls itself a security upgrade 
                               
Does it contact the “mother-ship” regularly and without your approval? Yes, it does.   
  
                                                            
Does the Removal of the program require extraordinary measures? Yes, the only removal mechanism is reformat and reinstall the system
Does the program have interfere with the system function? Is this intentional? Yes
Yes
 

Dude, you’ve got spyware!

And Andy Cuomo is on the Case

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OK, we all know the story, Bank of America bought Merrill Lynch, but before the deal closed, they discovered that they had uncovered a toxic waste dump and bonus mill, not a brokerage, and when they tried to get out of it, the Treasury and the Fed leaned on them not to.

That much is clear. What is not clear is just how badly this is flubbed, how much pressure was put on BoA, and whether any laws were broken.

In any case, the SEC has been investigating this, and about 3 weeks ago, when presented with a settlement, Judge Jed Rakoff balked, saying that the settlement seemed not to make any sense: The fines were too low, and the conditions were too favorable to BoA:

U.S. District Judge Jed Rakoff in Manhattan said today that he wants a fuller explanation of the settlement by Sept. 9. He wants to know why the SEC accepted the bank’s claim that executives who issued a misleading statement relied on lawyers’ advice and why the agency didn’t press the bank to waive its attorney-client privilege to keep communications with counsel confidential.

Relying on lawyers’ advice can be a defense to a securities fraud lawsuit. At a trial, in order to invoke the defense, defendants must waive their attorney-client privilege, the SEC has said.

“This is puzzling,” Rakoff wrote in a four-page order today. “If the responsible officers of the Bank of America, in sworn testimony to the SEC, all stated that ‘they relied entirely on counsel,’ this would seem to be either a flat waiver of privilege or, if privilege is maintained, then entitled to no weight whatsoever, since the statement cannot be tested.”

So what the SEC has been doing is to say that they accept the claim of bad legal advice, but will not demand any proof by actually looking at this legal advice. IANAL, but this is just fracked, so he deferred it, and today, he has out right rejected the settlement.

And now we are starting to see weirdness, specifically the fact that Merrill’s general counsel was summarily fired 4 days after the deal closed. (also here).

We’re talking seriously, “He was immediately escorted from the building without being permitted to return to his office,” fired.

And now, Bank of America is refusing to waive privilege in order to get to the bottom of this, they are demanding to be let off without having any proof, and while the SEC is good with this, Andrew Cuomo is not.

He is now writing letters making it clear that anyone who attempts to suggest that it was bad legal advice, but refuses to supply legal memoranda will be subject to prosecution (also here):

I think that is legal speak for pulling out the hand cuffs, and saying talk now, co%$-suckers.

Bank of America is denying all wrong doing, of course, and the SEC continues to aggressively stonewall both Cuomo and Rakloff.

Maybe I’,m just a paranoid son of a bitch, but I think that there is something very big and very ugly under this rock.

Warning To Whistleblowers: If You Turn in Big Fish, We Will Destroy You

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Bradley Berkenfeld was the man who turned informant to reveal that Swiss Bank UBS was actively aiding and abetting fraudulent schemes to evade taxes.

He has now been sentenced to 40 months in a Federal prison, while folks like Igor Olenicoff, who hid hundreds of millions of dollars from the IRS are getting probation:

Birkenfeld got slammed because, for all the good he did, he didn’t tell on himself. So prosecutors sought a 30-month prison term for him, and a federal judge in Fort Lauderdale, Florida, ratcheted it up to 40 months at sentencing last week.

…

If you’re looking to ferret out waste, fraud and abuse, that notorious trio of government parasites, there is nothing like an insider.

That is why Congress has for years passed laws encouraging whistleblowers by offering job protection to government employees and a cut of any funds recovered because of their informing.

The Birkenfeld sentence stands as an insult to any claim that the government wants whistleblowers to step up. Fear of retaliation and career suicide make it hard enough to rat on your boss. Now you can add the possibility of prison time as payment for your effort.

…

Prosecutors better hope that Birkenfeld’s tips will last them a very long time. They shouldn’t expect more whistleblowers to show up any time soon.

The author of this article, Ann Woolner misses the point: This is not a bug, it’s a feature.

Prosecutors and judges have a long history of going after white collar whistle-blowers with jail time because they don’t want people to rat out rich people, who after all, are not like you and me, and should not be subject to the rule of law.

In eulogizing Dominick Dunne, Daily Beast correspondent Allan Dodds Frank sheds some light on this attitude:

He [Dunne] had a view that nonviolent crimes committed by the upper class were understandable, defensible, and often just part of what they do. Martha and Al were getting raw deals, he felt. In fact, white-collar crime was so commonplace and garden variety that he had no desire to cover the great corporate crooks of the era who had so little class.

(emphasis mine)

Not enough bullets.

Well, This Explains the Stock Market Bump

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I believe that I’ve mentioned this before, but what is going on here is that the Federal Reserve is printing money and giving it to bankers with instructions to buy stocks, in order to pump up the market.

There is a lot that is wrong with this, it’s the biggest pump and dump scheme in the history of ……Well……History is the immediate flaw that comes to mind, but this ignores the truly troubling aspect of these actions.

The scary part is that this is based in the heartfelt belief that the stock market really is the economy, and so by creating an artificial bump in stock prices, that you are creating a real bump in the real economy.

At it’s core, this is what is wrong here: The inability to see Wall Street and Main Street as separate items, and to recognize that Main Street is far more important.

When this peters out, and it will, we will be in a deeper hole than when we started.

He Should Not Be Prosecuted for Marijuana Possession

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Because no one should be prosecuted on marijuana possession.

On the other hand, Andrew Sullivan’s endorsement of the racist pseudoscience of the Bell Curve, and his publication of the lies of Betsy McCaughey while editor-in-chief of The New Republic should be grounds for deportation from the United States on moral grounds.

You see Andrew Sullivan was smoking pot on the beach in Massachusetts, where marijuana possession has been decriminalized, only it was on a federal beach, and that makes it a federal beef.

The prosecutors decided not to pursue charges, which basically amount to a $125 fine, though they did with 3 other defendants that day, and US Magistrate Judge Robert B. Collings believes that this was a case of prosecutors not applying the law equally or fairly:

Three other defendants charged with the same offense had to appear before Collings the same day as Sullivan, the judge noted. But Sullivan’s case was the only one prosecutors did not pursue, out of concern that the $125 fine carried by the relatively minor offense could derail his US immigration application.

“It is quite apparent that Mr. Sullivan is being treated differently from others who have been charged with the same crime in similar circumstances,’’ Collings wrote in the 11-page memorandum, adding that prosecutors’ rationale for the dismissal was inadequate.

Collings added with obvious irritation that he had no power to order prosecutors to pursue the case, and granted their motion to dismiss it. The fact that he did, however, “does not require the Court to believe that the end result is a just one,’’ he wrote.

Needless to say, the United States Citizenship and Immigration Services, formerly the INS, could do the right thing, and deport him back to that socialist hellhole, England.

Affirmative Action for White Folks

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Of course, for white people, you don’t call it affirmative action, you call it nepotism, and the poster child for nepotism, at least this week is Luke Russert, who upon having the opportunity to question Congressional heckler Joe Wilson in his first press statements following his heckling Barack Obama’s speech, chose to asks him about the Clemson/Georgia Tech game.

You know, it’s genetics. Tim Russert did this kind of sh&% all the time…If you were a republican on his show.

Zim Update

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Well, it’s been about a month, so it’s time for another update on what is happening in Zimbabwe.

The two biggest pieces of news are Robert Mugabe’s health, he is 85 years old, and there are officially denied rumors that he has gone to Qatar for prostate cancer treatment, and he has missed some significant meetings.

Additionally, we are beginning to see senior ZANU-PF members vying for position, with, for example, someone having put up the party youth group (I assume that this mean young adults) to call for the removal of John Nkomo and Joyce Mujuru from the party presidium.

We are also seeing the situation with the Chiadzwa diamond fields get out of hand,with a threat by the world Diamond Council to suspend Zimbabwe from the Kimberly Process certification, which would label one of their few sources of hard currency “blood diamonds,” though threat comes with a statement which immediately backtracks from the threat, though they are making noise about revisiting the issue in November.

The Parliament has also opened an investigation into the accusations of brutality, corruption, and slave labor, and the World Federation of Diamond Bourses has made a call for the prompt release of the Kimberly report.

The reason that this is significant is because it is a sign of loss of control by Mugabe. It’s fairly clear that he feels that he cannot give the order for the Zimbabwean military to stand down in Chiadzwa because it would eliminate one of the few remaining means that he has to bribe reward loyalists, and it is unclear if the army would obey if he were to give the order.

This is an indication that Mugabe is losing power within ZANU-PF as people look to his exit.

On a more prosaic level, it looks like Mugabe is trying to kill Tsvangerai again: He has had to sack somemembers of his security team for “misplacing” transport for a significant portion of his security detail, which left him ill-protected…..Then again, maybe I’m just a cynic.

Meanwhile, the Mutambara faction of the MDC appears to be in the process of self destructing, with conflicting claims as to who leads the MDC-M, reports that the party has split in 3 parts, 3 MDC-M MPs moving to join the MDC-T, and Mutambara being unable to convince an MP from his own party to step down and take an ambassadorship in order to allow deputy president Gibson Sibanda to keep his position on cabinet as Minister of State for National Healing and Reconciliation. (The constitution prohibits a cabinet post being held by someone not an MP for more than 3 months)

We had Zuma taking over for the completely useless and biased Mbeki as mediator, and while we got some strong language, such as Zuma calling Mugabe’s behavior in negotiations deviant, but the results, despite Tsvangerai’s pleas for action, have not gone beyond a SADC call for an extraordinary summit.

Most notably, you have the issues of Reserve Bank of Zimbabwe Governor Gideon Gono and Attorney General, Johannes Tomana, both tremendously corrupt and incompetent ZANU-PF loyalists, which means that the power of the purse and state violence (though both the police and military) remain firmly in the hands of Mugabe.

With the elimination of the $Z as a currency, this has reduced Gono’s power to pay off people, but he is once again attempting to reintroduce the local currency, though Finance Minister Tendai Biti is fighting him tooth and nail on this.

The harassment of MDC members of parliament continues, with police making trumped up arrests of opposition MPs.

It’s clearly an attempt to reduce the MDC majority in parliament, since once convicted, they can no longer serve, and so there would have to be by-elections.

The problem for the ZANU-PF with this strategy is that they are polling in the single digits, (also here).

ZANU-PF has proposed 5-year extension on the current 1-year freeze on elections, but the MDC has made it clear that it has no interest in such a proposal.

The 2nd of ZANU-PF is to make elections impossible, either by pleading poverty, or by refusing to staff the election board created by the unity government agreement.

Meanwhile, the IMF has issued $400 million in foreign currency reserves, which would be good news, except for the fact that Gideon Gono (remember him?) is insisting that he is in charge of disbursing all these funds.

I’d sooner have Bernie Madoff managing that money.

Vote Fraud Discovered in Afghanistan

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I’m shocked, shocked to find that gambling is going on here!
Shaded Regions Indicate Fraud

It appears that the level of vote fraud is so bad that even the Afghan Electoral Complaints Commission (ECC), a group of Karzai toadies, has admitted to widespread vote fraud:

There was “clear and convincing evidence of fraud” in Paktika, Kandahar and Ghazni, areas that largely backed President Hamid Karzai, it said.

Earlier this week results from 600 stations where there were suspected irregularities were “quarantined”.

…

The ECC said in a statement that its investigations in Ghazni found “a number of indicators of fraud”.

Those included unfolded ballots, votes for candidates inserted inside bundles for other candidates, miscounted ballots, missing material, uniformity of markings, seal numbers which did not match numbers on the record of seals and lists of voters with numerous fictitious card numbers, the statement said.

All from Karzai strongholds. (Bottom pic, darker regions)

What a surprise.

The End of the Ratings Agency?

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We are seeing two things going on here.

First, we have a crisis in confidence in the ratings agencies, best exemplified by the decision of state insurance regulators reviewing their reliance on ratings agencies:

State regulators scheduled a hearing to review their reliance on ratings firms in grading insurers’ financial strength and whether changes are needed after the plunge of top-ranked bonds exposed flaws in credit scores.

If people no longer believe in ratings agencies, then they no longer have a business.

They business is quite literally a confidence game.

This, however is a long term problem.

The more immediate problem is that the Courts have finally got a clue, and determined that in the presence of evidence, email messages specifically, that these agencies were “putting lipstick on a pig,” that the ratings agencies can be held liable for fraud, and that these opinions, which they sell not subject to 1st amendment protections.

There are clear indications, emails and the like, that the ratings agencies were deliberately issuing inaccurate ratings in order to boost market share and consulting income.

David Einhorn explains why the recent suit against the ratings agencies is so catastrophic:

Their ratings business is entirely dependent on a lack of legal jeopardy, and they have now lost this.

Doubtless there will be some sort of ratings business, but I expect it to be very tightly regulated, or possibly done by a federal agency.

And then there is this bit of Panglossian crap:

Note the comment at about 6:10,

There has already been a shift. There’s a recognition; there’s potential liability, and any intelligent compliance officer at the investment bank, at the major money managers, are going to say, “We have to do something about this,” and they are in the process of changing their practices.

I would not trust this guy to manage a lemonade stand.

Republican Family Values

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Michael Duvall, Assembly Utilities and Commerce Committee Vice Chairman was caught on tape bragging about having affairs with two lobbyists.

The money quote:

I’m getting into spanking her and yeah I like it..

Ummmm….Ewwwwwwww!!!

In any case, he has been removed from two of the committees he serves on, one would assume the ones that the lobbyists “served”.

He also talks about her underwear…..Ummmm…..Ewwwwwww!!!!!

But he’s a family values kind of guy:

Such thinking impressed certain constituencies. Earlier this year, the man who never graduated from high school received ‘100 percent’ approval scores 
by the California Republican Assembly, the state’s leading conservative outfit, and the Capitol Resource Institute (CRI), a fierce guardian of traditional family values.


Great googly moogly…I though that I had rather uninhibited tastes during my single days,* but I had the good sense not to brag to everyone in the room, on a live mike.

*Full disclosure: Said “uninhibited tastes” were mostly in my imagination…I was a geek.

Ashcroft Can Be Sued Over Misuse of Material Witness Statute

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There are limits to the immunity of people in law enforcement.

Basically, it comes down to the fact that you can sue someone for being wrongly arrested or imprisoned, but not for being wrongly indicted or prosecuted, so a 3 judge federal appellate panel, by a vote of 2½ to ½, there was a partial concurrence by one of the judges, said that a Lawsuit against John Ashcroft over the misuse of the material witness statute can proceed.

Basically, the purpose of the material witness statute is to ensure that a witness who might otherwise become unavailable, i.e. skip town, will be available to the authorities, but John Ashcroft used it to detain people on his whim, which the judges describes as, “repugnant to the Constitution, and a painful reminder of some of the most ignominious chapters of our national history.”

Because a prosecutor cannot be sued for a prosecution, but he can be for an arrest.

Glenn Greenwald’s take on this is a good read.

Just How F%$#ing Stupid Does Hamid Karzai Think We Are?

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So, the vote count in Afghanistan is done, and now Karzai has 54.1% of the vote, he was at about 48% at 70% of the vote, so the “late reporting precincts” had to deliver him something like 68%. (also here)

There are non existent polling places, polling places occupied by his supporters, etc.

Here is the money quote:

One Western official said that had the Afghan Independent Election Commission not decided on Monday to undo a decision it made the day before to enforce stricter safeguards, Mr. Karzai’s vote total would still be under 50 percent, forcing him into a second election against Mr. Abdullah.

The election commission had moved on Sunday to carry out precautions intended to catch a number of voting irregularities. But as it became clear that those safeguards would prevent Mr. Karzai from surpassing the 50 percent threshold, the decision was reversed Monday, and the election commission announced that it had no legal authority to exclude the ballots, the Western official said.

“He was below 50 percent when you exclude the obviously fraudulent votes,” said the official, who spoke anonymously according to diplomatic protocol.

This is actually an opportunity for Obama. Now he can tell the generals that he afraid to offend to get the hell out of Dodge. It’s what Kennedy should have done after Diem’s assassination.

If he does not use this to extricate himself from the “Graveyard of Empires,” he’s going to be Johnson in 1968 without the accomplishments of Johnson in 1963, 1964, 1965, 1966, and 1967, and it won’t be pretty, because whatever Republican gets the nomination, you can be sure that they will not be as intelligent, welcoming, or honorable as Richard M. Nixon….I think that I just hurt something saying that last bit.

Bad Hair News

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Upon his indictment about 7 years ago

Leaving Prison with hair in a pony tail.

Corrupt Congressman James Traficant has been released from prison after serving 7 years.

Normally, I would not note this, but when I first found the web, I decided that it was impossible for me to create a particularly useful web page, so instead I attempted create the most useless page.

It was dedicated bad hair days, and it’s been kind of moribund for years, but Mr. Traficant is there front and center.

Unethical Even by the Standards of the Public Relations Industry*

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It turns out that the discovery that Mark Penn’s use of his Wall Street Journal column to pimp for clients and to trawl for new clients is not an issue for their editorial page.

Not surprising, given that the WSJ has the most venal and dishonest editorial OP/ED section in the United States, though Fred Hiatt and the Washington Post offer some competition in that area.

*I cannot believe that I just said that.†
†That may be the first time that I’ve ever said this about a Democrat.‡
‡But it is Mark “The Human Stain” Penn, so it is not a surprise that he would have earned this distinction.