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$WMT’s Mexican Unit Documents Show Company Used Governor to Implement Bribery

 

Wal-Mart Stores Inc.’s (WMT) Mexican unit used a current state governor there to facilitate $156,000 in bribes meant to help open stores, an ex-lawyer for the retailer told company officials in 2005, according to documents released by members of the U.S. Congress.

The payments were negotiated by Graco Ramirez Garrido Abreu, who at the time served as a federal lawmaker for the state of Morelos, a Wal-Mart summary of the accusations stated. It was released Jan. 10 by Democratic Representatives Henry Waxman of California and Elijah Cummings of Maryland, whose staff is investigating the lawyer’s allegations….”

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Former Jefferies Executive Charged in Mortgage Fraud Case

Source

“(Reuters) – A former Jefferies Group Inc managing director has been charged with defrauding investors in mortgage-backed securities in the wake of the 2008 financial crisis so that he could make more money for his employer, U.S. investigators said on Monday.

Jesse Litvak was charged with 16 criminal counts, including 11 counts of securities fraud, one count of fraud on the federal Troubled Asset Relief Program (TARP), and four counts of making false statements to the federal government.

The U.S. Securities and Exchange Commission also filed related civil charges against Litvak.

A lawyer for the defendant did not immediately respond to a request for comment.”

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Money Market Managers Seek to Limit Regulation So as Not to Disrupt Short Term Paper Markets

 

“Three of the five largest U.S. money-market fund managers, signaling they can’t stop a second attempt by regulators to overhaul rules for the $2.7 trillion industry, are fighting instead to limit the scope of any changes.

Fidelity Investments, Vanguard Group Inc. and Charles Schwab Corp. (SCHW) are urging regulators to exempt retail-oriented funds and focus on those that cater to institutional clients and buy corporate debt, a category that absorbed the bulk of an investor run in 2008. Known as prime institutional funds, they hold $987 billion, or 37 percent of U.S. money-market mutual- fund assets, according to research firm iMoneyNet……..

Fidelity last week drew regulators’ attention to data showing funds that cater to small investors, and those that invest solely in municipal or U.S. government-backed debt, were more stable than institutional prime funds. In the four weeks after the bankruptcy of Lehman Brothers Holdings Inc., retail funds had $41 billion in withdrawals compared with $453 billion from institutional funds, according to the letter.

“If, based on findings from its study, the SEC determines that further reform is necessary, then such reform should be narrowly tailored, so as to minimize disruption to short-term markets and lessen adverse impacts on long-term economic activity,” Fidelity, the largest U.S. money fund manager, wrote in a Jan. 24 letter to the SEC….”

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Anonymous Threatens Massive WikiLeaks-Style Exposure, Announced On Hacked Gov Site

“Hacktivist organization, Anonymous, is threatening perhaps their biggest play ever: a massive WikiLeaks-style exposure of sensitive U.S. government secrets. As proof of their power, they announced details of the plan on hacked government website, the United States Sentencing Commission (USSC.gov). Citing the recent death of free information activist Aaron Swartz, they explain, “With Aaron’s death we can wait no longer. The time has come to show the United States Department of Justice and its affiliates the true meaning of infiltration.”

Swartz was facing up to 50+ years in prison and a $4 million fine after releasing pay-walled academic articles from the popular JSTOR database. Some legal scholars have argued that releasing copyrighted material, or breaking the “terms of service” of a website, should not carry such harsh penalties. Anonymous is demanding that legislation be passed to no longer consider such violations a felony–a law that Congresswoman Zoe Lofgren (CrunchGov Grade: A) has already introduced.

If legal reforms are not enacted, Anonymous has threatened to activate files containing embarrassing or incriminating secrets….”

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Draghi & Monti Implicated in Italian Bank Scandal, Veneer of Recovery Could Crack

“While little has been said in the mainstream western press about the ongoing fiasco surrounding Siena’s Banca Monte dei Pasci, Italy’s third largest bank and the world’s oldest which may get its third bailout in three years – or even be nationalized – as soon as today, for fears that it may break the thin veneer of “recovery” in the European financial system, the situation on the ground in Italy is getting more serious by the minute, and will have implications on both next month’s general election, on Mario Monti, on Silvio Berlusconi, on frontrunner for the Prime Minister post Pier Luigi Bersani, and reach as far up as the head of the ECB – Mario Draghi.

Several hours ago, on Saturday morning, the four-member board of the Bank of Italy – this time without its prior president Mario Draghi – met to consider the position of scandal-hit bank Monte dei Paschi di Siena and decide whether to authorize its request for 3.9 billion euros ($5.3 billion) of state loans.

As we reported previously, it has emerged over the past week that due to previously undisclosed derivative contracts first exposed by Bloomberg, the Siena bank has hid as much as $1 billion in losses. However as was explained in “Will The Super Goldman Mario Brothers Succeed In Covering Up The Latest Italian Bailout Scandal“, this discovery has far greater implications for both the bank’s future viability, as well as the implied credibility of both the Bank of Italy, and especially the man who headed it for five years before becoming head of the ECB (where he now demands the same supervisory authority over all European banks that he had in Italy, only to supposedly let countless derivative fiascos slip through his fingers).

As Zero Hedge first connected the dots, it is not so much a question of why BMPS engaged in a variety of derivative deals, of which only three have emerged so far and likely has many more on the books, but how or rather why, the then-Draghi led Bank of Italy allowed this to happen not once, not twice, but at least three times….”

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Sierra Club Plans ‘Arson Based Eco-Terrorism’ to Thwart Keystone Pipeline

“The Sierra Club has announced its approval for a “one-time” use of civil disobedience. The civil disobedience is intended to step up their efforts to oppose the Keystone pipeline.

Many of the other groups opposing Keystone have been engaging in civil disobedience as a tactic, including arson-based ecoterrorism. This will be the first time in the Sierra Club’s history that they have approved violating the law.

In a January 22, 2013 press release, the Sierra Club states:

The Sierra Club Board of Directors has approved the one-time use of civil disobedience for the first time in the organization’s 120-year history.

The Club went as far as implying Hurricane Sandy was the result of humanity and stated:

Recognizing the imminent danger posed by climate disruption, including record heat waves, drought, wildfires and the devastation of superstorm Sandy, the Sierra Club board of directors has suspended a long-standing Club policy to allow, for one time, the organization to lead a group of environmental activists, civil rights leaders, visionaries, scientists, and other high-profile individuals in a peaceful protest to dirty and dangerous tar sands.  The action will be by invitation only and is being co-sponsored by 350.org….”

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Iran Raises the Prospects of War

“The United States has nothing left to pressure Tehran over its nuclear programme except for war, and if it chooses conflict Iran could close a key energy chokepoint, its envoy to Baghdad told AFP on Thursday.

Ambassador Hassan Danaie-Far insisted in an interview that Tehran retained the right to close the Strait of Hormuz, through which a third of the world’s traded oil passes, in response to any aggression, military or otherwise.

“What else (US President Barack) Mr. Obama can do?” Danaie-Far said through an Iranian embassy translator.

“The only remaining card on the table is war. Is it to their benefit? Is it to the benefit of the world? Is it to the benefit of the region?”

The diplomat said that if it faced a “problem,” Tehran would be within its rights “to react and to defend itself.”

Asked if it could try to close off the strait, Danaie-Far replied: “If there is some movement and action from our enemies, including US, against us, as a part of natural reaction, that may happen.”

“Everybody would be a loser in that case,” he added.

On whether only military or other types of pressure could spur Iran to make such a move, he said: “It can include all of them.” …”

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Mole Implicates Another Former SAC Capital Trader in Insider Trading

“Dipak Patel, a former SAC Capital portfolio manager, has been fingered by a mole, says the WSJ.

 

The undercover informant has told federal investigators that she passed confidential information to the trader for years.

Patel, who was a technology stock manager for Steve Cohen’s hedge fund, has yet to be charged with any wrongdoing. He left SAC Capital in 2010.

Investigators have been concentrating their efforts on SAC Capital in a big way for years. The heat has been especially intense since last November, when federal prosecutors wrote that SAC CEO Steve Cohen interacted with alleged insider trader, Mathew Martoma in a complaint. Six former SAC employees have been convicted of or pleaded guilty to insider trading since 2009.

From the WSJ: …”

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$CBK To Pink Slip 4-6k Jobs

Commerzbank AG (CBK), Germany’s second- biggest bank, will cut 4,000 to 6,000 jobs over the next four years to reduce costs and meet its profit goals.

The job reductions will apply to all units worldwide with the retail bank having “significant overcapacity,” according to an internal memo obtained by Bloomberg news, the contents of which were confirmed by spokesman Simon Steiner in Frankfurt. Chief Executive Officer Martin Blessing declined to comment on the cuts at the World Economic Forum in Davos,Switzerland….”

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Egan Jones Ratings Gets Barred From Rating Certain Bonds by the SEC

 

“The U.S. Securities and Exchange Commission barred Egan-Jones Ratings Co. from issuing ratings on certain bonds, an unprecedented step by the regulator and a setback for a small credit-rating firm with a history of courting controversy.

The SEC said Tuesday that Egan-Jones couldn’t officially rate bonds issued by countries, U.S. states and local governments, or securities backed by assets such as mortgages, for at least the next 18 months.

The ban was part of an agreement the SEC reached with Egan-Jones and its president, Sean Egan, to settle charges that they filed inaccurate documents with the regulator in 2008. The SEC alleged that Egan-Jones misled investors about its expertise, and that Mr. Egan caused the firm to violate conflict-of-interest provisions.

The firm and Mr. Egan agreed to the settlement without admitting or denying the findings.

Mr. Egan didn’t respond to a request for comment. He has been outspoken in the past in his defense of the firm and its ratings…..”

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Lawsuits Against Corporate Fraud Hit a 7 Year Low

“WASHINGTON, Jan 23 (Reuters) – Fewer investors are taking corporate America to court for fraud.

The number of new federal securities fraud lawsuits seeking class-action status fell to a 7-year low in 2012, according to a study by Stanford Law School and Cornerstone Research released on Wednesday.

Just 152 such lawsuits were filed last year, down 19 percent from 188 in 2011, mainly because of fewer lawsuits challenging mergers.

Last year’s total is also 20 percent below the average of 190 for the period from 1997 to 2012.

Only 2005, when 120 lawsuits were filed, was a quieter year for new cases. And in last year’s fourth quarter, just 25 new securities fraud lawsuits were filed, the fewest in any quarter since 1997, the first year included in the study.

Big companies also were sued less in 2012 than in prior years. Seventeen companies in the Standard & Poor’s 500 index were named as defendants in 2012, versus an average of 31 over the prior decade….”

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$AMGN Uses 74 Lobbyists to Win Fiscal Cliff Gift

Source

Amgen, Inc., the world’s largest biotechnology firm, will continue to sell one of its best selling drugs at unregulated prices, thanks to a provision buried within the fiscal-cliff compromise.

With the help of its corps of 74 lobbyists, Amgen convinced lawmakers to include a clause that will prevent Medicare from imposing price restraints on a class of drugs that includes Sensipar, an Amgen medication sold to kidney dialysis patients.

The provision buys Amgen another two years of selling the drug without federal caps. That’s great news for the company’s bottom-line, but bad news for Medicare, which will pay an extra $500 million for the drug.

Some congressional aides privately criticized the gift to Amgen, noting the biotech giant had already received a two-year delay.

“That is why we are in the trouble we are in,” Dennis J. Cotter, a health policy researcher who studies the cost and efficacy of dialysis drugs, told The New York Times. “Everybody is carving out their own turf and getting it protected, and we pass the bill on to the taxpayer.”

The delay will go a good way towards making up for Amgen’s most recent criminal activity. On December 19, Amgen—as a corporate entity—pleaded guilty to illegal marketing of its anti-anemia drug, Aranesp, and agreed to pay penalties totaling $762 million.”

 

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Sarkozy to Move to London To Avoid France’s We Want 75% of Your Ass Tax, Will Set Up Hedge Fund

  • “Fraud police found details of move and business plan in raid on home
  • Sarkozy is under investigation for corruption in France
  • He will be latest Frenchman to escape potential top French tax rate of 75%
  • Couple would become London’s most high profile Gallic celebrities
  • Sarkozy would hope for fund support from French entrepreneur Alain Minc

 

Nicolas Sarkozy is preparing to move to London to set up a billion pounds plus investment fund, it was claimed today.

If the move goes ahead, the controversial Frenchman will become the latest to escape a potential top tax rate of 75 per cent in his home country.

He and his former supermodel third wife Carla Bruni-Sarkozy would be likely to settle in an affluent district like South Kensington – so becoming the most high profile Gallic celebrity couple in the city.

But the former president is under investigation for corruption in France, and if he does cross the Channel there will be outrage.

Details of the planned move were uncovered during a raid by fraud police on Sarkozy’s Paris mansion last June.

It came within weeks of Mr Sarkozy losing his immunity against prosecution after being defeated by Socialist rival Francois Hollande in the May presidential election.

Now the hugely respected investigative news site Mediapart reports that the ‘first draft’ of Mr Sarkozy’s London project was found by detectives examining his computer files.

A judge has since made Sarkozy an assisted witness in the so-called Bettencourt Affair, in which he is accused of using illegal cash from France’s richest woman to fund his 2007 election campaign….”

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$BBY to Close 300 Stores and Pink Slip 3k

“BBY has announced that it’s closing around 300 stores in the U.S. over the next few weeks.

That’s around 35 percent of its total brick-and-mortar presence of 850 stores.

Around 3,000 employees will be laid off as a result of the closings, according to a spokesperson from parent company Dish Network.

“We continue to see value in the Blockbuster brand and we will continue to analyze store level profitability and — as we have in the past — close unprofitable stores,” the spokesperson told the Los Angeles Times….”

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$CAT Trading Lower on Accounting Problems With a Chinese Burrito They Acquired

“Shares of Caterpillar, the world’s largest construction equipment manufacturer, are falling in pre-market trading today after the company announced a big writedown on Friday after the closing bell.

The $580 million charge announced by Caterpillar on Friday afternoon relates to an acquisition the company made in China last year. It paid $800 million for the company, Siwei, but the target company’s management team had apparently been fudging the books for quite some time, leading Caterpillar to wildly overpay for the acquisition.

BofA Merrill Lynch analyst Ross Gjilardi has a good summary of the writedown:

Big impairment charge tied to Siwei acquisition…”

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WSJ: $DB To Be Fined Over Energy Trading Practices

“(Reuters) – U.S. electricity regulators are expected to impose a $1.5 million fine as early as Tuesday on a Deutsche Bank AG subsidiary over alleged power market manipulation, the Wall Street Journal reported, citing people with knowledge of the matter.

The Federal Energy Regulatory Commission (FERC) earlier proposed that the energy-trading arm of Deutsche pay the fine and disgorgement of $123,198 in alleged ill-gotten profits last year, saying it manipulated California power prices.

Last week, the FERC requested a further extension in the legal deadline until January 22 amid the ongoing talks. (http://link.reuters.com/tej45t)

Deutsche Bank has disputed FERC’s allegation that it manipulated the market by deliberately losing money on physical transactions to profit in derivative markets…”

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Timothy Geithner Accused Of Alerting Banks To 2007 Interest Rate Cut For 2nd Time

“* Richmond Fed’s Lacker resurrects 2007 allegation

* Geithner said in 2007 that claim was not accurate

* U.S. Treasury declines comment on latest Lacker statement

* Disclosure of rate cut plans would be highly unusual

By Alister Bull

WASHINGTON, Jan 18 (Reuters) – In the summer of 2007, as storm clouds gathered over the world’s financial system, then-New York Federal Reserve President Timothy Geithner allegedly informed the Bank of America and other banks about the possibility the U.S. central bank would lower one of its critical interest rates, according to a senior Fed official.

Jeffrey Lacker, the head of the Richmond Fed, originally raised the allegation during a Fed conference call in August 2007, and he stuck to his 5-year-old claim against the current U.S. treasury secretary in a statement provided to Reuters on Friday.

“From conversations I had prior to the video conference call on August 16, 2007, I was aware of discussions among a few large banks about borrowing from their discount windows to support the asset backed commercial paper market,” Lacker said in the statement. “My understanding was that (New York Fed) President Geithner had discussed a reduction in the discount rate with these banks in connection with these initiatives.”

According to transcripts of the call released by the Fed on Friday, Geithner at the time denied that banks knew the Fed was considering cutting the discount rate. The Fed regularly releases transcripts of its policy meetings with a five-year lag.

“We don’t have any comment beyond the transcript,” said Treasury spokesman Anthony Coley. The Treasury declined to make Geithner available to comment.

Information about any planned interest rate move by the Fed is among the most sensitive as it can have a huge impact on a range of financial markets worldwide. That was particularly the case in the summer of 2007 when there were growing concerns about financial stability as a crisis that would reach fever pitch just more than a year later began to build….”

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A ‘Mini Madoff Fraud’ Has Barclays in Hot Water

“FRANKFURT (Reuters) – Investors who lost money in a Ponzi scheme run by Helmut Kiener, convicted founder of the K1 hedge fund in Germany, are suing Barclays Plc for selling his products to them, their lawyers said on Friday.

The lawyers said they were seeking a total of around 100 million euros ($133.58 million) in damages and had lodged more than 100 suits against Barclays with regional courts in Frankfurt and Munich over warrants issued by the bank that were linked to Kiener portfolios.

Kiener, dubbed a German “mini Madoff” by the media in reference to the jailed U.S. fraudster, was sentenced in July 2011 to more than 10 years in prison for a scam that prosecutors said cost investors 345 million euros.

The lawyers, who said they represent more than 1,000 claimants, have also moved to bundle the claims into a class action suit.

“We are confident the Frankfurt court will initiate the class-action case within six months,” said Andreas Tilp, one of the lawyers from the ProtectInvest Alliance (PIA), which respresents the plaintiffs.

The Munich and Frankfurt regional courts confirmed that the PIA had filed claims against Barclays in December.

“It was a large number of suits,” a spokesman for the Frankfurt court said. He confirmed the request to start a class-action suit but declined to give further details.

A spokesman for Barclays said the bank would vigorously defend itself in the case.

“Barclays continues to believe the Kiener-related claims are wholly without merit,” he said….”

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$RIO Ousts CEO as Bad Bets Cost Billions

Rio Tinto RIO.AU +2.71% Chief Executive Tom Albanese agreed to step down Thursday, the latest in a string of leaders toppled by shifting fortunes at the world’s biggest mining companies.

The New Jersey native ended his six-year tenure as the company said it would write off roughly $14 billion in the value of various assets—among the largest charges ever in an industry increasingly rocked by runaway costs.

Mr. Albanese, who was behind two large, ill-timed acquisitions at the world’s second-biggest mining company, took responsibility for the hit. “I fully recognize that accountability for all aspects of the business rests with the CEO,” said the 55-year-old engineer.

The bulk of the write-down, between $10 billion and $11 billion, relates to aluminum assets acquired in 2007 that have socked the Anglo-Australian company before. The remaining $3 billion is for Mozambique coal operations acquired only two years ago.

“A write-down of this scale in relation to the relatively recent Mozambique acquisition is unacceptable,” Chairman Jan du Plessis said. “We are also deeply disappointed to have to take a further substantial write-down in our aluminum businesses.” Rio Tinto’s shares fell 1.5% to close at 64.60 Australian dollars (US$68.29) in Sydney….”

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Classic: NY Fires Auditor Who Discovered the Misuse of Sandy Recovery Funds

 

“No good deed goes unpunished in New York: the state has abruptly cut off a contract with the independent auditor who found that the state had been wasting federal money meant to be spent on Hurricane Sandy recovery efforts.

Thomas Sadowski, the fired consultant, told the Times Union that he was escorted out of the building when he visited the New York Office of Emergency Management shortly after he filed his report on November 17.

The state hired Sadowski for his extensive experience in emergency procurement management with the federal government. The certified public accountant also did similar work for 10 years at the U.S. Department of Interior’s Inspector General’s office. Sadowski also trained the U.S. Forest Service, Alaska Fire Service, National Interagency Fire Center, Colorado Wildfire Academy, and other government agencies.

“I didn’t believe I did anything to be escorted off the premises,” Sadowski told the Times Union. “I wasn’t trying to get back at anybody or get anybody in trouble.” But Sadowski said he believed he was fired for finding the waste. “I was relieved of my duties because I identified these problems,” he said.

In his report, Sadowski found that the state was buying equipment it didn’t need but had wanted for other purposes, had bought equipment that cannot be tracked, and even lost some equipment bought….”

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