THE BURNED OVER DISTRICT

WHEN we made our annual foray into the executive pay gold mine in April, chief executives’ earnings for 2012 showed what appeared to be muted growth on the year. The $14 million in median overall compensation received by the top 100 C.E.O.’s was just a 2.8 percent increase over 2011, the figures showed.

Well, what a difference a few months and a larger pool of C.E.O.’s make. According to an updated analysis, the top 200 chief executives at public companies with at least $1 billion in revenue actually got a big raise last year, over all. The research, conducted for Sunday Business by Equilar Inc., the executive compensation analysis firm, found that the median 2012 pay package came in at $15.1 million — a leap of 16 percent from 2011.

So much for the idea that shareholders were finally getting through to corporate boards on the topic of reining in pay.

At least the stock market returns generated by these companies last year exceeded the pay increases awarded to their chiefs. Still, at 19 percent in 2012, that median return was only three percentage points higher than the pay raise.

In other words, it’s still good to be king.

Because the data shows only chief executives’ pay, it does not reveal how good it still is to be a prince. Brian Foley, an independent compensation consultant in White Plains, pointed out that the 2012 compensation of the No. 2 executives at some of these companies would have vaulted them to the top ranks on the C.E.O. roster.

// posted by montag @ 1:15 PM 0 Comments

PETER DOSHI walked across the campus of Johns Hopkins University in a rumpled polo shirt and stonewashed jeans, a backpack slung over one shoulder. An unremarkable presence on a campus filled with backpack-toters, he is 32, and not sure where he’ll be working come August, when his postdoctoral fellowship ends. And yet, even without a medical degree, he is one of the most influential voices in medical research today.

Dr. Doshi’s renown comes not from solving the puzzles of cancer or discovering the next blockbuster drug, but from pushing the world’s biggest pharmaceutical companies to open their records to outsiders in an effort to better understand the benefits and potential harms of the drugs that billions of people take every day. Together with a band of far-flung researchers and activists, he is trying to unearth data from clinical trials — complex studies that last for years and often involve thousands of patients across many countries — and make it public.

The current system, the activists say, is one in which the meager details of clinical trials published in medical journals, often by authors with financial ties to the companies whose drugs they are writing about, is insufficient to the point of being misleading.

// posted by montag @ 1:02 PM 0 Comments

Here, on a Christian farmer’s land five miles from the Mexican border, lies the holiest of fields for some of New York’s most observant Orthodox Jewish communities. Wheat harvested on these 40 acres is destined to become matzo, the unleavened bread eaten by Jews during the eight days of Passover.

It is not an everyday plant-and-pick operation, and the matzo made from this wheat is not everyday matzo.

Yisroel Tzvi Brody, rabbi of the Shaarei Orah synagogue in Borough Park, Brooklyn, stood at the edge of one of the fields on Monday, stooping to rub a grain of wheat between his wrinkled thumb and index finger. Removing his glasses, he brought the grain close to his eyes and turned it from side to side, like a gemologist inspecting a precious stone.

“It is to ascertain that it’s not sprouted,” Rabbi Brody explained. “If it has, it’s not valid.”

For seven weeks, while the wheat grew in scorching heat under impossibly blue skies, two men clothed in the traditional black and white garments of the Hasidim stayed in a trailer overlooking the crop, to be able to attest that the wheat, once matured, had been untouched by rain or other moisture. Workers were prohibited from carrying water bottles in the field. Dust danced in the air as the wind blew, but unpaved roads could not be wet while the wheat was growing. The goal was to prevent any natural fermentation from taking place in the grains before they were milled into flour and the matzo was baked, sometime in the late fall.

Tradition calls for keeping watch over the matzo from the time the wheat is milled. Ultra-Orthodox Jews have carried that practice several steps further, guarding the grains before the wheat is harvested to ensure they are not overripe or wet from rainfall.

// posted by montag @ 1:33 PM 1 Comments

NASA’s Voyager 1 spacecraft, launched more than 35 years ago and now 11.5 billion miles from where it started, is closing in on this boundary. In recent years scientists have been waiting eagerly for it to become the first artificial object to leave the solar system and enter the wider reaches of the Milky Way, which they fully expect it to do. But there has been at least one false alarm.

On Thursday, scientists reported that, no, Voyager 1 still had not reached interstellar space, but it had entered a region that no one expected and no one can yet explain, a curious zone that is almost certainly the last layer of our Sun’s empire — technically speaking, the heliosphere. Three papers published in the journal Science describe in detail the sudden and unpredicted changes encountered in the surroundings of Voyager 1, which left Earth about three months after the original “Star Wars” movie was released and is heading for the cosmos at 38,000 miles per hour.

Scientists had expected that Voyager 1 would detect two telltale signs as it passed through the heliosheath, the outermost neighborhood of the solar system, which is thought to abut the heliopause, as the actual boundary is known. Happily, the key instruments on Voyager 1, as well as those on its twin, Voyager 2, are still working after all these years, and its nuclear power source will last until at least 2020.

// posted by montag @ 1:56 PM 0 Comments

The Italian police on Friday arrested a prelate, a financial broker and an agent of the Italian Secret Service on corruption charges as part of a complex plot in which the priest — who is already under investigation on suspicion of money laundering involving the Vatican Bank — is accused of trying to repatriate millions of euros from Switzerland to Italy in a private plane.

Those arrested were charged with fraud, corruption and slander as part of a broad investigation tied to the famously secretive Vatican Bank.

Prosecutors say that the broker and the Secret Service agent had been plotting to help the priest bring 20 million euros, or $26 million, into Italy from Switzerland in a private jet, the ANSA news agency reported. It said that the 20 million euros belonged to “some friends of the monsignor.” The plot never went through.

In a statement, the Vatican spokesman, the Rev. Federico Lombardi, said that the priest, Msgr. Nunzio Scarano, had been suspended from his position at one of the Vatican’s main financial departments “more than a month ago, ever since his superiors were informed that he was under investigation.”

The Vatican spokesman said that the Holy See had not received any requests from the Italian authorities, but confirmed its “willingness for full collaboration,” and that the Vatican’s internal financial watchdog was following the matter and would take appropriate measures “if necessary.” Those would include requesting that the Vatican’s internal prosecutor open an internal investigation into the monsignor.

A Vatican official said Monsignor Scarano had been suspended from his position as an accountant at APSA, a department that oversees the Vatican’s real estate holdings, after prosecutors in Salerno opened a separate investigation into money laundering. The official indicated that the suspension was a sign that the Vatican was stepping up its internal vigilance.

Only priests, religious, Catholic institutions, employees of Vatican City State and diplomats accredited to the Holy See are allowed to have accounts at the Vatican Bank, known as the Institute for Works of Religion, but rumors have long swirled about whether accounts were used as fronts for other interests, including organized crime and Italian politicians.

// posted by montag @ 1:47 PM 0 Comments

Chief Justice Roberts has proved adept at persuading the court’s more liberal justices to join compromise opinions, allowing him to cite their concessions years later as the basis for closely divided and deeply polarizing conservative victories.

His patient and methodical approach has allowed him to establish a robustly conservative record while ranking second only to Justice Anthony Kennedy as the justice most frequently in the majority.

“This court takes the long view,” said Kannon K. Shanmugam, a lawyer with Williams & Connolly in Washington. “It proceeds in incremental steps.”

On Tuesday, when the court struck down a part of the Voting Rights Act, Chief Justice Roberts harvested seeds he had planted four years before. In his 2009 opinion, writing for eight justices, he allowed the Voting Rights Act to stand. But the price he exacted from the court’s liberal wing was language quoted in Tuesday’s decision that seems likely to ensure the demise of the law’s centerpiece, Section 5, which requires federal oversight of states with a history of discrimination.

The chief justice helped plant new seeds on Monday, when seven justices, including two liberals, agreed to sign an opinion that over time could restrict race-conscious admissions plans at colleges and universities. Only the senior member of the court’s liberal wing, Justice Ruth Bader Ginsburg, filed a dissent.

Last year, in the second-biggest surprise of his decision upholding President Obama’s health care law, Chief Justice Roberts persuaded two liberal justices to join the part of his opinion allowing states to opt out of the law’s expansion of Medicaid. That ruling has added significant complications to the rollout of the law.

Only the justices know their motives and arrangements, but there is a pattern here. The price of victory today for liberals in the Roberts court can be pain tomorrow.

// posted by montag @ 1:43 PM 0 Comments

U.S. Bank, headquartered in Minneapolis, along with its partner, Dealers’ Financial Services of Lexington, Ky., violated the law by engaging in deceptive marketing and lending practices, regulators with the Consumer Financial Protection Bureau alleged Thursday.

The auto loan program created by the two companies – the Military Installment Loans and Educational Services program – was designed to appeal to young service members who were new to the car-buying process and had little or no credit history. It required them to make payments on subprime loans through the military’s so-called “discretionary allotment system,” a process that automatically deducts the money from their salaries before the funds are deposited in a bank or credit union.

Regulators said the program neglected to inform the borrowers of all the fees third-parties would charge to process the automatic deductions. It also failed to explain how often payments were due or that the intricacies of the payment schedule meant additional interest charges, according to regulators.

“MILES used the military discretionary allotment system to its advantage – requiring that service members pay straight from their paycheck before the money hit their personal bank accounts – without properly disclosing all associated fees and the way the program worked,” Richard Cordray, the consumer bureau’s director, said in a press call.

Without admitting any wrongdoing, U.S. Bank said it took regulators’ concerns seriously and no longer would participate in the loan program.

// posted by montag @ 12:58 PM 0 Comments

There is an old saying that Texas is “heaven for men and dogs, but hell for women and oxen.” But the state’s history is chock-full of stories of female role models. Barbara Jordan. Ann Richards. In downtown Austin, there’s a statue of Angelina Eberly, heroine of the Texas Archives War of 1842, firing a cannon and looking about 7 feet tall.

I do not have nearly enough time to explain to you about the Archives War, although it’s an extremely interesting story. Right now we need to move on to State Senator Wendy Davis, whose 11-hour filibuster this week turned her into a national name brand.

“It was like a made-for-TV movie. I’ve been around the block, but I’ve never seen anything like this,” said Cecile Richards, the president of Planned Parenthood and the daughter of the former governor.

Texas is a state with one of the nation’s highest teenage motherhood rates, where a majority of women who give birth are poor enough to qualify for Medicaid. So, naturally, its political leaders have declared war against the right of women to choose whether or not they want to be pregnant. Funding for family planning has been slashed. This month, Gov. Rick Perry tried to pass a new law that would have shut down almost all the abortion clinics in the state, under the guise of expanded health and safety requirements.

// posted by montag @ 1:24 PM 2 Comments

The Gulf of Mexico could see a record-size dead zone this year of oxygen-deprived waters resulting from pollution, US scientists have cautioned based on government data models.

The National Oceanic and Atmospheric Administration’s forecasts said the dead zone could be as large as New Jersey, or up to 8,561 square miles (22,172 square kilometers).

Dead zones are toxic to marine life and are caused by excessive nutrient pollution due to agriculture runoff. They are influenced by weather, precipitation, wind and temperature.

When there is little oxygen in the water, most marine life near the bottom is unable to survive.

“This year’s prediction for the Gulf reflects flood conditions in the Midwest that caused large amounts of nutrients to be transported from the Mississippi watershed to the Gulf,” NOAA said in a statement.

“Last year’s dead zone in the Gulf of Mexico was the fourth smallest on record due to drought conditions, covering an area of approximately 2,889 square miles.”

The final results will not be known until August. If the region gets a big tropical storm between early July and early August, the estimate would drop to 5,344 square miles.

Over the past five years, the Gulf’s dead zone has averaged about 5,600 square miles.

// posted by montag @ 1:09 PM 0 Comments

Wolfgang Schmidt was seated in Berlin’s 1,200-foot-high TV tower, one of the few remaining landmarks left from the former East Germany. Peering out over the city that lived in fear when the communist party ruled it, he pondered the magnitude of domestic spying in the United States under the Obama administration. A smile spread across his face.

“You know, for us, this would have been a dream come true,” he said, recalling the days when he was a lieutenant colonel in the defunct communist country’s secret police, the Stasi.

In those days, his department was limited to tapping 40 phones at a time, he recalled. Decide to spy on a new victim and an old one had to be dropped, because of a lack of equipment. He finds breathtaking the idea that the U.S. government receives daily reports on the cellphone usage of millions of Americans and can monitor the Internet traffic of millions more.

“So much information, on so many people,” he said.

East Germany’s Stasi has long been considered the standard of police state surveillance during the Cold War years, a monitoring regime so vile and so intrusive that agents even noted when their subjects were overheard engaging in sexual intercourse. Against that backdrop, Germans have greeted with disappointment, verging on anger, the news that somewhere in a U.S. government databank are the records of where millions of people were when they made phone calls or what video content they streamed on their computers in the privacy of their homes.

Even Schmidt, 73, who headed one of the more infamous departments in the infamous Stasi, called himself appalled. The dark side to gathering such a broad, seemingly untargeted, amount of information is obvious, he said.

“It is the height of naivete to think that once collected this information won’t be used,” he said. “This is the nature of secret government organizations. The only way to protect the people’s privacy is not to allow the government to collect their information in the first place.”

// posted by montag @ 12:39 PM 1 Comments

The Dodd-Frank financial overhaul law gave shareholders the ability to vote on the pay packages of top executives, and it turns out that they fall over themselves to approve.

More companies are achieving Fidel Castro-like election results this year than in the first two years since Dodd-Frank started requiring such votes. A full 72 percent of companies reporting votes so far have received 90 percent or more shareholder approval for their pay packages. That compares with 69 percent in both 2012 and 2011, according to Equilar, an executive compensation consultancy.

And shareholders are feeling relatively magnanimous about the rotten apples, too. Only 41 companies out of nearly 1,800 failed so far this year on say-on-pay votes, compared with 49 companies at this point last year, according to the companies tracked by the executive compensation consulting firm Semler Brossy.

Troublingly, investors pass larger companies more readily than they do smaller firms. But the chief executive of a large company deserves more scrutiny over pay, not less. That’s partly because the livelihoods of so many people depend on people running big firms, but also because those executives are largely caretakers of already established institutions. Typically, they have displayed neither vision nor entrepreneurialism but an ability to rise through a bureaucracy without offending anyone. When they arrive on the throne, they typically do a little bit better or a little bit worse than their predecessor, without distinguishing themselves in the least. Yet, they get paid as if they were the second coming of Henry Ford.

The final strike against say-on-pay is that it has had no impact on the level of compensation. Quite the opposite. Pay for chief executives was at its highest level ever last year, up 6.5 percent from a year earlier, according to an Equilar analysis. After a brief dip at the height of the recession, pay for corporate chieftains rose 6 percent in 2011 and soared 24 percent in 2010. For those keeping score at home, that sharply outpaces inflation, which was a piddling 1.7 percent last year. Median worker pay didn’t keep up with rising prices in those years.

// posted by montag @ 1:55 PM 0 Comments

Undaunted by Japan’s real estate misadventures in the 1980s — some Japanese investors wildly overpaid for United States property, and Japan eventually suffered one of the biggest property market collapses in history — Chinese investors are fanning out in the United States.

What began with a few isolated purchases two years ago has become a hunt for trophy properties and billion-dollar deals. So far, the kind of fears that arose in the 1980s — unfounded talk that Japan was “buying up” America — have not surfaced this time. To the contrary, the Chinese, or at least their money, are being welcomed, even celebrated.

Some caution that China could quickly retreat, as Japan did, if its economy worsens. Signs of economic weakness in China have been mounting, and the country’s financial system has recently come under stress. Those concerns could dissipate if Beijing steps in to ease strains in the nation’s banking industry and to spur growth, but many economists see real and growing dangers within China’s economy.

And yet in recent weeks, several big deals in New York City have set real estate circles abuzz. Zhang Xin, a Chinese business magnate and chief executive of the largest commercial real estate developer in Beijing, joined forces with the Safra family of Brazil to buy a large piece of the General Motors Building in Midtown. Dalian Wanda Group, a big Chinese developer, said it intended to build a luxury hotel in Manhattan. (Wanda is also planning to build a hotel in London.)

The deals go beyond shimmering glass-and-steel towers: Chinese and Hong Kong investors have also become the second-largest foreign buyers of United States homes, after the Canadians.

// posted by montag @ 1:40 PM 0 Comments

In a pair of highly anticipated decisions, the divided court effectively undercut California’s Proposition 8 and struck down the federal Defense of Marriage Act. Though one of the decisions was written narrowly, together they provide an emphatic, if incomplete win for same-sex marriage advocates.

The same-sex marriage decisions, issued on the final day of the term that started last October, address different issues. In each, a slim 5-4 majority rallied for the position that effectively supported same-sex marriage.

The Proposition 8 case involved a challenge to the California ballot measure that banned same-sex marriage. On Wednesday, the court concluded that the supporters of Proposition 8 lacked the legal standing to defend the ballot measure.

“Because we find that petitioners do not have standing, we have no authority to decide this case on the merits, and neither did the Ninth Circuit,” Chief Justice John Roberts Jr. wrote.

The decision leaves intact a trial judge’s order blocking Proposition 8 from taking effect. At the very least, this means two same-sex couples who filed the lawsuit against the ballot measure can marry. Advocates say other same-sex couples in California should be able to take advantage of the same ruling, though that might still require further trial-level clarification.

The court’s majority, though, stopped short of declaring a constitutionally protected right to same-sex marriage nationwide. The court also declined to take up the Obama administration’s proposal, which would have extended the ruling to a handful of other states that have shared California’s policy mix of allowing civil unions while banning gay marriage...

The separate Defense of Marriage Act case involved a challenge to the 1996 federal law that prohibited same-sex couples who had been married under state laws from obtaining a host of federal benefits. A majority concluded portions of the law violated the Constitution. “DOMA divests married same-sex couples of the duties and responsibilities that are an essential part of married life,” Justice Anthony Kennedy wrote for the majority. Kennedy joined the court’s four liberal justices in the 5-4 decision.

Section 3 of the Defense of Marriage Act declares that, for the purposes of providing federal benefits, marriage is “only a legal union between one man and one woman as husband and wife” and a spouse is only a “person of the opposite sex who is a husband or a wife.”

The definition is important because it determines eligibility for a host of federal rights, benefits and privileges.

The Government Accountability Office has identified more than 1,100 areas of federal law in which marriage matters. These range from tax and welfare benefits to employment and immigration. A same-sex military couple, for instance, is denied housing, health insurance and disability benefits, nor is the spouse eligible for burial alongside his or her spouse in a national cemetery.

“The statute is invalid, for no legitimate purpose overcomes the purpose and effect to disparage and injure those whom the state, through its marriage laws, sought to protect in personhood and dignity,” Kennedy wrote.

// posted by montag @ 12:46 PM 0 Comments

The Commodity Futures Trading Commission, the federal agency that regulated MF Global, plans to approve the lawsuit as soon as this week, according to law enforcement officials with knowledge of the case. In a rare move against a Wall Street executive, the agency has informed Mr. Corzine’s lawyers that it aims to file the civil case without offering him the opportunity to settle, setting up a legal battle that could drag on for years.

Without directly linking Mr. Corzine to the disappearance of more than $1 billion in customer money, the trading commission will probably blame the chief executive for failing to prevent the breach at a lower rung of the firm, the law enforcement officials said. If found liable, he could face millions of dollars in fines and possibly a ban from trading commodities, jeopardizing his future on Wall Street.

In a statement, a spokesman for Mr. Corzine denounced the trading commission for planning to file what he called an “unprecedented and meritless civil enforcement action.”

The aggressive action would stand in contrast to the government’s investigations so far into the 2008 financial crisis, many of which produced symbolic fines. In the case of Lehman Brothers, which imploded at the height of the crisis, no employee has ever been charged with civil or criminal wrongdoing...

A case would darken the cloud over the legacy of Mr. Corzine, 66, who as a onetime Democratic governor and senator from New Jersey and a former chief of Goldman Sachs has long been a confidant of leaders in Washington and on Wall Street.

But it would also suggest that authorities have all but removed a greater threat: criminal charges. After nearly two years of stitching together evidence, criminal investigators have concluded that porous risk controls at the firm, rather than fraud, allowed the customer money to disappear, according to the law enforcement officials with knowledge of the case.

// posted by montag @ 2:04 PM 0 Comments

At least 32 people were killed in Iraqi towns and cities on Tuesday, security sources said, the latest flare of violence in a country where sectarian attacks have become a frequent occurrence.

Two suicide bombers detonated explosive belts, one after the other, targeting Shiite Turkmen who had cut off the road between Kirkuk and Baghdad to protest the deteriorating security situation in the district of Tuz Khurmatu, in the east of Salahuddin province.

At least 16 civilians were killed and 53 were wounded, the sources said. The deputy governor of the province and the vice president of the Turkmen Front party were among those killed, they said...

In Mosul, in the north, a suicide bomber wearing an explosive belt blew himself up inside a popular cafe, killing 10 people and wounding 18.

In Babel province, south of Baghdad, a bomb targeted a bus carrying Shiite pilgrims heading to Karbala. Six of the pilgrims were killed, and 13 were wounded.

In Baghdad, gunmen opened fire on a church in the eastern part of the city, wounding three policemen guarding it.

The day’s violence followed a dozen bombings in and around Baghdad and north of the city on Monday, in which at least 41 people were killed and 125 wounded.

// posted by montag @ 1:49 PM 0 Comments

The dispute, which has drawn a throng of police officers, Chinese reporters and American diplomats to the factory in Huairou, began when the company, which is based in Coral Springs, Fla., and manufactures medical goods like lancets and insulin syringes, closed its injection molding division and gave roughly 30 employees what Mr. Starnes described in a telephone interview on Tuesday night as a generous severance package. But rumors soon spread that Mr. Starnes was planning to close the entire plant and flee without paying the rest of the work force, which happens often in China.

Although he explained that the remaining workers were not being laid off, the remaining 100 employees barricaded the exits on Friday and stopped him from leaving until he agreed to give them compensation identical to that given to the laid-off employees, a sum he contends would bankrupt the company...

In the interview, Mr. Starnes bemoaned his fate, saying local officials were pressing him to provide lavish compensation to workers who were not scheduled to be laid off. "The union just wants to do anything that will calm the people,” he said. “They are asking me to commit business suicide.”

Workers paint a starkly different picture of a company that has not paid its employees in weeks as news spread that Specialty Medical was relocating some operations to India. “We have been given an i.o.u. for two months and all assembly lines have stopped,” said one manager, who would only give his surname, Wang. “We went without work. What were we going to do?”

// posted by montag @ 1:45 PM 0 Comments

“In 1965, the states could be divided into two groups: those with a recent history of voting tests and low voter registration and turnout, and those without those characteristics,” Chief Justice John G. Roberts Jr. wrote for the majority. “Congress based its coverage formula on that distinction. Today the nation is no longer divided along those lines, yet the Voting Rights Act continues to treat it as if it were.”

Chief Justice Roberts said that Congress remained free to try to impose federal oversight on states where voting rights were at risk, but must do so based on contemporary data. When the law was last renewed, in 2006, Congress relied on data from decades before. The chances that the current Congress could reach agreement on where federal oversight is required are small, most analysts say...

The majority held that the coverage formula in Section 4 of the Voting Rights Act, originally passed in 1965 and most recently updated by Congress in 1975, was unconstitutional. The section determines which states must receive preclearance from the federal authorities.

The court did not strike down Section 5, which sets out the pre-clearance requirement itself. But without Section 4, which determines which states are covered, Section 5 is without significance — unless Congress chooses to pass a new bill for determining which states would be covered.

// posted by montag @ 1:35 PM 0 Comments

Edward J. Snowden, the former National Security Agency contractor who leaked details about American surveillance, personifies a debate at the heart of technology systems in government and industry: can the I.T. staff be trusted?

As the N.S.A., some companies and the city of San Francisco have learned, information technology administrators, who are vital to keeping the system running and often have access to everything, are in the perfect position if they want to leak sensitive information or blackmail higher-level officials.

“The difficulty comes in an environment where computer networks need to work all the time,” said Christopher P. Simkins, a former Justice Department lawyer whose firm advises companies, including military contractors, on insider threats.

The director of the N.S.A., Gen. Keith B. Alexander, acknowledged the problem in a television interview on Sunday and said his agency would institute “a two-man rule” that would limit the ability of each of its 1,000 system administrators to gain unfettered access to the entire system. The rule, which would require a second check on each attempt to access sensitive information, is already in place in some intelligence agencies. It is a concept borrowed from the field of cryptography, where, in effect, two sets of keys are required to unlock a safe.

From government agencies to corporate America, there is a renewed emphasis on thwarting the rogue I.T. employee. Such in-house breaches are relatively rare, but the N.S.A. leaks have prompted assessments of the best precautions businesses and government can take, from added checks and balances to increased scrutiny during hiring.

“The scariest threat is the systems administrator,” said Eric Chiu, president of Hytrust, a computer security company. “The system administrator has godlike access to systems they manage.”

// posted by montag @ 1:17 PM 0 Comments

Lately, Fed officials have been issuing increasingly strong hints that rather than doing more, they want to do less, that they are eager to start “tapering,” returning to normal monetary policy. The impression that the Fed is tired of trying so hard got even stronger last week, after a news conference in which Mr. Bernanke seemed quite happy to reinforce the message of an imminent reduction in stimulus.

The trouble is that this is very much the wrong signal to be sending given the state of the economy. We’re still very much living through what amounts to a low-grade depression — and the Fed’s bad messaging reduces the chances that we’re going to exit that depression any time soon.

The first thing you need to understand is how far we remain from full employment four years after the official end of the 2007-9 recession. It’s true that measured unemployment is down — but that mainly reflects a decline in the number of people actively seeking jobs, rather than an increase in job availability. Look, for example, at the fraction of adults in their prime working years (25 to 54) who have jobs; that ratio fell from 80 to 75 percent in the recession, and has since recovered only to 76 percent.

Given this grim reality — plus very low inflation — you have to wonder why the Fed is talking at all about reducing its efforts on the economy’s behalf.

// posted by montag @ 12:58 PM 0 Comments

We have long since surrendered a record of our curiosities and fantasies to Google. We have broadcast our tastes and addictions for the convenience of one-button Amazon shopping. We have published our health and financial histories in exchange for better and faster hospital and bank services. We have bellowed our angers and frustrations for all to overhear while we walk the streets or ride a bus. Privacy is a currency that we all now routinely spend to purchase convenience.

But Google and Amazon do not indict, prosecute and jail the people they track and bug. The issue raised by the National Security Agency’s data vacuuming is how to protect our civil liberty against the anxious pursuit of civic security. Our rights must not be so casually bartered as our Facebook chatter. Remember “inalienable”?

I envy the commentators who, after a few days of vague discussion, think they have heard enough to strike the balance between liberty and security. Many seem confident that the government is doing nothing more than relieving Verizon and AT&T and Facebook of their storage problems, so that government agents can, on occasion, sift through years of phone and Internet records if they need to find a contact with a suspicious foreigner. Many Americans accept assurances that specific conversations are only rarely exhumed and only if the oddly named Foreign Intelligence Surveillance Court allows it. Such sifting and warrants — in unexplained combination with more conventional intelligence efforts — are now said, by President Obama and his team, to have prevented several dozen potential terrorist attacks, with elliptical references to threats against New York City’s subways and stock exchange.

Even if true and satisfying, these assurances are now being publicized only because this huge data-gathering effort can no longer be denied. Whatever the motive for the leaks by Edward J. Snowden, they have stimulated a long-overdue public airing. Although the government’s extensive data-hauling activity was partly revealed by diligent reporters and a few disapproving government sources over the last seven years, the undeniable proof came only from Mr. Snowden’s documents. Until then, the very existence of the enterprise was “top secret” and publicly denied, even in Congressional hearings. Even now, the project remains a secret in every important respect.

// posted by montag @ 1:29 PM 0 Comments

Even before a former U.S. intelligence contractor exposed the secret collection of Americans’ phone records, the Obama administration was pressing a government-wide crackdown on security threats that requires federal employees to keep closer tabs on their co-workers and exhorts managers to punish those who fail to report their suspicions.

President Barack Obama’s unprecedented initiative, known as the Insider Threat Program, is sweeping in its reach. It has received scant public attention even though it extends beyond the U.S. national security bureaucracies to most federal departments and agencies nationwide, including the Peace Corps, the Social Security Administration and the Education and Agriculture departments. It emphasizes leaks of classified material, but catchall definitions of “insider threat” give agencies latitude to pursue and penalize a range of other conduct.

Government documents reviewed by McClatchy illustrate how some agencies are using that latitude to pursue unauthorized disclosures of any information, not just classified material. They also show how millions of federal employees and contractors must watch for “high-risk persons or behaviors” among co-workers and could face penalties, including criminal charges, for failing to report them. Leaks to the media are equated with espionage.

“Hammer this fact home . . . leaking is tantamount to aiding the enemies of the United States,” says a June 1, 2012, Defense Department strategy for the program that was obtained by McClatchy.

The Defense Department anti-leak strategy obtained by McClatchy spells out a zero-tolerance policy. Security managers, it says, “must” reprimand or revoke the security clearances – a career-killing penalty – of workers who commit a single severe infraction or multiple lesser breaches “as an unavoidable negative personnel action.”

Employees must turn themselves and others in for failing to report breaches. “Penalize clearly identifiable failures to report security infractions and violations, including any lack of self-reporting,” the strategic plan says.

The Obama administration already was pursuing an unprecedented number of leak prosecutions, and some in Congress – long one of the most prolific spillers of secrets – favor tightening restrictions on reporters’ access to federal agencies, making many U.S. officials reluctant to even disclose unclassified matters to the public.

// posted by montag @ 12:51 PM 0 Comments

At the state high-school wrestling tournament in Denver last year, three upperclassmen cornered a 13-year-old boy on an empty school bus, bound him with duct tape and sodomized him with a pencil.

For the boy and his family, that was only the beginning.

The students were from Norwood, Colorado, a ranching town of about 500 people near the Telluride ski resort. Two of the attackers were sons of Robert Harris, the wrestling coach, who was president of the school board. The victim’s father was the K-12 principal.

After the principal reported the incident to police, townspeople forced him to resign. Students protested against the victim at school, put “Go to Hell” stickers on his locker and wore T-shirts that supported the perpetrators. The attackers later pleaded guilty to misdemeanor charges, according to the Denver district attorney’s office.

“Nobody would help us,” said the victim’s father, who asked not to be named to protect his son’s privacy. Bloomberg News doesn’t identify victims of sexual assault. “We contacted everybody and nobody would help us,” he said.

// posted by montag @ 2:11 PM 0 Comments

Federal authorities are asking Virginia Gov. Robert F. McDonnell’s associates about previously undisclosed gifts given by a campaign donor to McDonnell’s wife that total tens of thousands of dollars and include money and expensive designer clothing, according to people familiar with the inquiry.

The questions are part of broad federal and state investigations into gifts to the governor and his family and whether McDonnell (R) took official action on behalf of anyone who gave gifts, people with knowledge of the investigation have said.

The probe already involves a $15,000 gift from wealthy businessman Jonnie R. Williams Sr., chief executive of a major McDonnell campaign donor, for catering at the 2011 wedding of one of McDonnell’s daughters.

But the people with knowledge of the inquiry, who spoke on the condition of anonymity because of the sensitive nature of the investigation, say the scope is wider than just the wedding gift. The value and nature of additional gifts from Williams, including money provided in several checks, suggest that authorities are exploring a more extensive relationship between Williams and the McDonnells than previously revealed.

// posted by montag @ 1:48 PM 0 Comments

Senate Minority Leader Mitch McConnell (R-KY) on Friday said that he opposed a constitutional amendment to ban corporations from having the same rights as people because the idea was “absurd.”

Speaking to the conservative American Enterprise Institute, McConnell accused President Barack Obama’s administration of using a “culture of intimidation” to stifle free speech.

Following the remarks, the Washington Free Beacon’s Lachlan Markay asked McConnell for his thoughts on a constitutional amendment proposed by Sens. Jon Tester (D-MT) and Chris Murphy (D-CT) to clarify that corporations are not “people” and restore Congress’ ability to limit corporate influence in elections.

“Well you have to give them some points for not hiding it,” McConnell quipped. “They are uncomfortable with corporate free speech obviously.”

// posted by montag @ 1:25 PM 0 Comments

In a sign of deepening U.S. involvement in the Syrian crisis, the United States is leaving 700 combat-equipped American military personnel in Jordan following the end of a joint U.S.-Jordanian training exercise, President Barack Obama told Congress Friday.

The decision brings to about 1,000 the number of U.S. troops now deployed in Jordan. It came a week after the White House announced that the United States would begin providing light arms to Syrian rebels fighting the regime of President Bashar Assad.

Obama said the troops would remain in Jordan to help provide that country with security, but he did not say specifically what they would be doing.

“The detachment will remain in Jordan, in full coordination with the government of Jordan, until the security situation becomes such that it is no longer needed,” Obama wrote. “The deployment of this detachment has been directed in furtherance of U.S. national security and foreign policy interests, including the important national interests in supporting the security of Jordan and promoting regional stability.”

// posted by montag @ 12:54 PM 0 Comments

The days of cop-out settlements in high-profile securities cases may be waning.

In a departure from long-established practice, the recently confirmed chairwoman of the Securities and Exchange Commission, Mary Jo White, said this week that defendants would no longer be allowed to settle some cases while “neither admitting nor denying” wrongdoing.

“In the interest of public accountability, you need admissions” in some cases, Ms. White told me. “Defendants are going to have to own up to their conduct on the public record,” she said. “This will help with deterrence, and it’s a matter of strengthening our hand in terms of enforcement.”

In a memo to the S.E.C. enforcement staff announcing the new policy on Monday, the agency’s co-leaders of enforcement, Andrew Ceresney and George Canellos, said there might be cases that “justify requiring the defendant’s admission of allegations in our complaint or other acknowledgment of the alleged misconduct as part of any settlement.”

They added, “Should we determine that admissions or other acknowledgment of misconduct are critical, we would require such admissions or acknowledgment, or, if the defendants refuse, litigate the case.”

Ms. White said that most cases would still be settled under the prevailing “neither admit nor deny” standard, which, she said, has been effective at encouraging defendants to settle and speeding relief to victims.

The policy change follows years of criticism that the S.E.C. has been too lenient, especially with the large institutions that were at the center of the financial crisis. Bank of America, Goldman Sachs, Citigroup and JPMorgan Chase were among the defendants that settled charges related to the financial crisis while neither admitting nor denying guilt, although Goldman was required to admit that its marketing materials were incomplete.

// posted by montag @ 1:34 PM 0 Comments

The private company responsible for vetting Edward Snowden for a security clearance is under criminal investigation for systemic failure to adequately conduct background checks.

Sen. Claire McCaskill, D-Mo., announced at a Senate hearing Thursday that USIS, a government contractor headquartered in Falls Church, Va., conducted a background check for Snowden in 2011. The 29-year-old systems administrator’s clearance gave him access to classified documents he later leaked to the media, revealing secret surveillance by the National Security Agency.

“We are limited in what we can say about this investigation because it is an ongoing criminal matter, but it is a reminder that background investigations can have real consequences for our national security,” McCaskill said. “Federal agencies, like the Defense Department, rely on these background investigations to make assessments of whether people should be trusted with our nation’s most sensitive information. . . . It appears that this trust has been broken.”

USIS is the largest commercial provider of background investigations to the federal government. The company said in a statement that USIS has never been informed that it is under criminal investigation, although it did receive a subpoena for records from the inspector general of the Office of Personnel Management in January 2012. “USIS complied with that subpoena and has cooperated fully with the government’s civil investigative efforts,” the statement said.

// posted by montag @ 12:44 PM 0 Comments

The world has grown accustomed to a gentle image of Buddhism defined by the self-effacing words of the Dalai Lama, the global popularity of Buddhist-inspired meditation and postcard-perfect scenes from Southeast Asia and beyond of crimson-robed, barefoot monks receiving alms from villagers at dawn.

But over the past year, images of rampaging Burmese Buddhists carrying swords and the vituperative sermons of monks like Ashin Wirathu have underlined the rise of extreme Buddhism in Myanmar. Buddhist lynch mobs have killed more than 200 Muslims and forced more than 150,000 people, mostly Muslims, from their homes.

Ashin Wirathu denies any role in the riots. But his critics say that at the very least his anti-Muslim preaching is helping to inspire the violence.

What began last year on the fringes of Burmese society has grown into a nationwide fundamentalist movement whose agenda now includes boycotts of Muslim-made goods. Its message is spreading through regular sermons across the country that draw thousands of people and through widely distributed DVDs of those talks. Buddhist monasteries associated with the movement are also opening community centers and a Sunday school program for 60,000 Buddhist children nationwide.

The hate-filled speeches and violence have endangered Myanmar’s path to democracy, raising questions about the government’s ability to keep the country’s towns and cities safe and its willingness to crack down or prosecute Buddhists in a Buddhist-majority country. The killings have also reverberated in Muslim countries across the region, tarnishing what was almost universally seen abroad as a remarkable and rare peaceful transition from military rule to democracy. In May, Indonesian authorities foiled what they said was a plot to bomb the Myanmar Embassy in Jakarta in retaliation for the assaults on Muslims.

// posted by montag @ 1:53 PM 0 Comments

Now Mr. Mehlman, a private equity executive in Manhattan, is waging what could be his final campaign: to convince fellow Republicans that gay marriage is consistent with conservative values and good for their party. His about-face, sparked in part by the lawyer who filed the California lawsuit, has sent him on a personal journey to erase what one new friend in the gay rights movement calls his “incredibly destructive” Bush legacy.

He remains controversial, both applauded and vilified. On the left, he is either an unlikely hero or a hypocritical coward. On the right, some Republicans embrace him; others deem him a traitor.

Coming out “has been a little bit like the Tom Sawyer funeral, where you show up at your own funeral and you hear what people really think,” Mr. Mehlman said in a recent interview in his office at Kohlberg Kravis Roberts, on the 42nd floor of a Midtown skyscraper. “A big part of one’s brain that used to worry about this issue has now been freed to worry about things that are much more productive.”

Mr. Mehlman, 46, remains the hyper-intense, guarded strategist he was in his Bush days, with the same habit of looking past people instead of meeting their eyes. He shuns most interviews and still deflects personal questions, as he did back when rumors about his sexuality swirled.

“I have a happy life today, and I had a happy life before,” he said. Freed of the burden of secrecy, he lives in the gay-friendly Chelsea neighborhood and summers in the Hamptons.

// posted by montag @ 1:44 PM 0 Comments

The 70 staffers of the National Declassification Center are charged with deciding – anonymously and quietly – which of the nation’s old secrets can be laid bare for the world to see.

They have a backlog of hundreds of millions of pages marked for possible declassification, and they’re able to release those that don’t reveal information about weapons of mass destruction, harm diplomatic relations or threaten the safety of the president of the United States. But no one believes they’ll be able to make a year-end deadline set by President Barack Obama. And in the meantime, the government is classifying even more secrets.

After three and half years, just 70 million pages have been released, including the Pentagon Papers and a World War I-era recipe for secret ink. Another 45 million pages have been kept classified. The rest have yet to be fully processed. (Because the material is more than 25 years old, it’s paper and not the disks, microfilm and emails that came later.)

“It’s not going to happen,” said Steven Aftergood, who directs the Federation of American Scientists Project on Government Secrecy, and is an expert on – and prominent critic of – government secrecy. “That should be a signal to everyone that the system is broken. Not even the president can make it work.”

Meanwhile, the government can’t keep up with the ever-escalating onslaught of classified documents, which are accumulating faster than ever before because of the growing bureaucracy, switch to electronic data and a prevailing culture of secrecy.

Each day, federal agencies spend more time, money and effort classifying documents than declassifying them.

In fiscal year 2011, about 2,400 employees classified documents and only hundreds declassified them.

// posted by montag @ 1:20 PM 0 Comments

The maker of the popular Firefox browser is moving ahead with plans to block the most common forms of Internet tracking, allowing hundreds of millions of users to limit who watches their movements across the Web, company officials said Wednesday.

The decision comes despite intense resistance from advertising groups, which have argued that tracking is essential to delivering well-targeted, lucrative ads that pay for many popular Internet services. When Firefox’s maker, Mozilla, first publicly suggested in February that it might limit blocking, one advertising executive called it “a nuclear first strike” against the industry.

Widespread release of the blocking technology remains months away, but Mozilla officials spoke confidently Wednesday about the growing sophistication of tools they are building to limit the placement of “cookies” in users’ browsers.

// posted by montag @ 2:02 PM 0 Comments

FBI Director Robert Mueller (MULL-er) says the law enforcement agency uses drones for surveillance but does so rarely.

In an appearance before the Senate Judiciary Committee, Mueller says the bureau is developing guidelines for drones and that the privacy implications of using drones are, in Mueller’s words, worthy of debate and legislation down the road.

The aerospace industry forecasts a worldwide deployment of almost 30,000 drones by 2018, with the United States accounting for half of them.

// posted by montag @ 2:00 PM 0 Comments

“I think what you see is there’s still a communication problem,” said Joseph A. Smith Jr., the monitor. “If there’s a unifying feature, it’s that the servicers who failed these things are not yet communicating effectively.” The banks report their own performance on the 29 criteria, and their findings are then tested in a random sampling by outside groups.

Citibank failed three metrics, two of which involve notifying borrowers of missing documents in a timely fashion and one that requires a letter containing accurate information be sent to a homeowner before foreclosure.

Bank of America failed two metrics, one regarding missing documents and the other regarding the pre-foreclosure letter. Wells Fargo also flunked on the missing documents.

JPMorgan Chase failed to adhere to the prescribed timeline for reviewing loan modification requests and notifying customers of its decision. It also failed to remove home insurance policies, known as forced-place insurance, within two weeks of a homeowner’s submitting proof that he or she had insurance.

The fifth lender, Ally Financial, whose mortgage servicing is now handled by other companies, was not found to have failed on any of the metrics.

The banks are required to submit a corrective action plan and compensate affected borrowers. Chase, for example, has already refunded insurance premiums charged to 2,000 borrowers. “We quickly fixed the issue,” said Amy Bonitatibus, a spokeswoman for Chase, adding that the timeline problem had been remedied as well.

Wells Fargo said that its internal reviews showed that it had already fixed its problem. Citi said it had already fixed one of its issues and was working on the other two.

Dan Frahm, a spokesman for Bank of America, which is responsible for about 60 percent of the total financial obligation under the settlement, said, “While neither area of noncompliance resulted in inaccurate foreclosures or improper loan modification denials, we took immediate action and resolved one area and will soon return to compliance in the other.”

// posted by montag @ 1:46 PM 0 Comments

After nearly 12 years of U.S. military involvement in Afghanistan, the administration is pinning much of its hopes on a political settlement to the war as it moves ahead with plans to withdraw U.S. combat troops by the close of 2014. The announcement came as the U.S. marked the handover of security from U.S.-led NATO forces to Afghanistan forces.

“We don’t anticipate this process will be easy or quick, but we must pursue in parallel with our military approach,” Obama said.

The peace process was already in disarray within 24 hours when Afghan President Hamid Karzai announced his government would suspend talks with the U.S. on a security agreement, saying the U.S. was deceptive in its approach to the talks. Karzai also said he would not send a representative to the U.S.-Taliban talks; Just before the Taliban office opened Tuesday, Karzai said he planned to send members of his High Peace Council to Qatar to speak for Afghanistan.

// posted by montag @ 1:04 PM 0 Comments

When the American-led NATO coalition officially transferred security responsibility for all of Afghanistan to government forces in a ceremony on Tuesday, it was in part a formality. Already this year, Afghan forces have been in the lead in fighting the Taliban in more than three-quarters of the country — and they have been killed and wounded at a record pace, accordingly.

But after Tuesday, these are supposed to be the rules everywhere: while American units may sometimes be close by, Afghan forces must operate without American air support, medical evacuation helicopters or partnered combat units. If they get in trouble, NATO will not be riding to the rescue, except in the most dire cases.

This summer is shaping up as a lesson in tough love from American military mentors to demonstrate whether the Afghan forces really can become self-sufficient by the withdrawal deadline for Western forces in 2014.

Just how tough that has been is perhaps nowhere more evident than in Room 648 of the Afghan National Army’s Military Hospital in Kabul. The room is shared by two soldiers wounded in the same battle against the Taliban in southern Afghanistan on May 22 and 23. One of them lost three limbs, the other lost two.

Their company, with the 205th Afghan Army Corps, was based in the Panjwai district of Kandahar Province. In May, they were sent to a village near Zangabad, the site of a popular anti-Taliban uprising in March that American and Afghan officials had hailed as turning a corner in an area long dominated by the militants. Just two months later, though, the insurgents were back.

According to the wounded soldiers’ accounts, later confirmed by their company commander, they found the area heavily mined and booby-trapped. When the soldiers began tripping mines, Taliban gunmen attacked, using tunnels through walls between adjoining homes in the village to hit and run.

“No one came to our aid and did anything,” said Lt. Masiullah Hamdard, who lost both legs and his left arm in the fight and was still twisting in pain from his injuries. He said that two American helicopters and a jet were circling above the battle. “We kept begging them to shoot up the place but they didn’t do anything whatever.”

Indeed, from Tuesday on, that is American policy everywhere in Afghanistan. The American military has decreed that no air support be available to Afghans unless an exception is approved by an officer holding a general’s rank — and already, the anecdotal evidence indicates that such exceptions have been rare.

// posted by montag @ 12:01 PM 1 Comments

A Florida man says that a first dated ended with him being beaten, forced to strip at gun point, robbed and then left in a cow pasture.

A Flagler County Sheriff’s Office case report obtained by NBC News indicated that 34-year-old Shaun Paul Williams was found naked and bloodied on State Road 100 in Bunnell. Williams told deputies that he had met a woman named “Tree” about two weeks ago in Dayton and agreed to go out on June 14.

When the woman picked him up on Friday, he discovered that two other men we also inside the vehicle. The woman explained that one of the men was her brother. She said that she needed to drop the men off at the brother’s home.

But instead of going to a home, the brother instructed the woman to stop at an “empty cow pasture.” Williams said that he exited the vehicle to urinate and was struck in the head with a “hard metal object.”

“Give me all your money and your clothes,” one of the men told him.

“Are you serious?” Williams replied.

Williams opened his eyes to find a semiautomatic pistol pointed at his head. He handed over about $200 in cash, a gray tank top, black Dickie shorts and a pair of DC sneakers. The bandits also made off with his Straight Talk pre-paid cellular phone and Florida driver’s license.

Deputies took Williams to a hospital to be treated for lacerations to his head.

// posted by montag @ 11:43 AM 0 Comments

The White House said today it welcomes the opening of a Taliban office in Dohar, Qatar as an "important first step" toward reconciliation in war-torn Afghanistan, a move that comes as the US marked the handover of security from US-led NATO forces to Afghanistan forces.

Senior White House officials said the Taliban later today will release a statement that its members oppose using Afghan soil to threaten other countries and that they support an Afghan peace process – two statements the U.S. has long called for and that fulfill a requirement for opening the political office.

Administration officials who spoke on the condition of anonymity to discuss negotiations said the U.S. welcomes the effort as an "important first step toward reconciliation," though they cautioned that "after 30 years of armed conflict in Afghanistan," it's likely to be a "complex, long and messy."

The White House says the US will be pushing for the Taliban and other insurgent groups to break ties with Al Queda, end violence and accept Afghanistan's Constitution -- including protections for women and minorities.

They called opening the office "but one milestone on a path to peace" and called on the Afghan government and Taliban to begin negotiations soon.

// posted by montag @ 11:30 AM 0 Comments

Tucked deep in the 1,198-page U.S. House agriculture policy legislation is an initiative to guarantee prices for sushi rice. So too is insurance for alfalfa and a marketing plan for Christmas trees.

Catfish farmers also get a morsel in the proposal being taken up this week: profit-margin insurance. The products represent a tiny fraction of the $440 billion U.S. farm economy. Yet each is slated to receive special treatment -- either through subsidized insurance, promotional programs or protections against imports -- in the bill that carries an estimated 10-year price tag of $939 billion.

“We’re in a golden age of agriculture,” with producer profits projected at a record $128.2 billion this year, Vince Smith, a professor of agricultural economics at Montana State University, said at a briefing on Capitol Hill last week. The House bill “is about as bad a bill as I could think of writing as an economist,” he said.

The farm bill, which benefits crop-buyers such as Archer-Daniels-Midland Co. (ADM), grocers including Supervalu Inc. (SVU) and insurers including Wells Fargo & Co. and Ace Ltd (ACE), has been working through Congress for almost two years. The Senate last week passed a version that would spend $955 billion over 10 years; the House this week is considering a version approved by its agriculture committee. The current, five-year authorization of U.S. Department of Agriculture programs passed in 2008 and was extended last year until Sept. 30.

Both the Senate and House versions would reduce payments to growers of corn, wheat and other crops by eliminating a $5 billion-a-year program of direct subsidies while expanding subsidized crop insurance. Their different price tags mainly result from variations in food-stamp spending. The Senate plan would reduce payments by $4 billion over a decade, about one-fifth the House amount.

// posted by montag @ 7:17 PM 0 Comments

Federal authorities seized 14 7-Eleven stores on Long Island and in Virginia early Monday, arresting nine owners and managers and charging them with harboring and hiring illegal immigrants and paying them using sham Social Security numbers, people briefed on the case said.

Immigration and Customs Enforcement agents and federal prosecutors in Brooklyn were also investigating 40 other 7-Eleven franchises in New York City and elsewhere, the person said, and the prosecutors were seeking $30 million in forfeiture from the stores and their corporate parent. The franchises split their profits with the corporation, which handles the store payrolls, the people said.

The owners and managers — eight men and a woman — were charged in an indictment to be unsealed Monday morning, the people said. It included accusations of wire fraud and aggravated identity theft stemming from payment of employees who were illegal immigrants using the Social Security numbers of children and the dead, the people said. One of the people said the owners and managers had abused and taken advantage of the illegal immigrant workers.

Many of those charged were of Pakistani descent and it was believed that most, if not all, of the illegal immigrants were also from Pakistan, one of the people said.

In one instance, an employee of one franchise was paid using the Social Security number of a former 7-Eleven employee, a person who had not worked for the store for 10 years and who had been the target of collection efforts by the Internal Revenue Service for much of that time because of the reported payments to the illegal immigrant, the people said.

// posted by montag @ 1:14 PM 0 Comments