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Friday, December 12, 2008

Top broker and Wall Street adviser Bernard L. Madoff, aged 70, was arrested and charged by the FBI on Thursday with a single count of securities fraud, also known as stock fraud and investment fraud. He allegedly told senior employees of his firm on Wednesday that his $50 billion business “is all just one big lie” and that it was “basically, a giant Ponzi scheme (since at least 2005).” Mr. Madoff faces up to 20 years imprisonment and a fine of up to $5 million. FBI agent Theodore Cacioppi said Mr. Madoff’s investment advisory business had “deceived investors by operating a securities business in which he traded and lost investor money, and then paid certain investors purported returns on investment with the principal received from other, different investors, which resulted in investors’ losses of approximately $50 billion dollars.”

The former chairman of the Nasdaq Stock Market is also the founder and primary owner of Bernard L. Madoff Investment Securities LLC, the closely-held market-making firm he launched in 1960. The firm is one of the top market maker firms on Wall Street. He founded his family firm with an initial investment of $5,000, after attending Hofstra University Law School. He saved the money earned from a job lifeguarding at Rockaway Beach in Queens and a part time job installing underground sprinkler systems.

A force in Wall Street trading for nearly 50 years, he has been active in the National Association of Securities Dealers (NASD), a self-regulatory organization for the U.S. securities industry. His firm was one of the five most active firms in the development of the NASDAQ, having been known for “paying for order flow,” in other word paying a broker to execute a customer’s order through Madoff. He argued that the payment to the broker did not alter the price that the customer received. He ran the investment advisory as a secretive business, however.

Dan Horwitz, counsel of Mr. Madoff, in an interview, said that “he is a longstanding leader in the financial-services industry with an unblemished record; he is a person of integrity; he intends to fight to get through this unfortunate event.” Mr. Madoff was released on his own recognizance on the same day of his arrest, after his 2 sons turned him in, and posting $10 million bail secured by his Manhattan apartment. Without entering any plea, the Court set the preliminary hearing for January 12.

Madoff’s hedge fund scheme may rank among the biggest fraud in history. When former energy trading giant Enron filed for bankruptcy in 2001, one of the largest at the time, it had $63.4 billion in assets. The scheme would dwarf past Ponzis, and it would further be nearly five times the telecommunication company WorldCom fraud and bankruptcy proceedings in 2002.

The Securities and Exchange Commission filed a separate civil suit on Thursday against Bernard L. Madoff Investment Securities and its eponymous founder Mr. Madoff. It was docketed as “U.S. v. Madoff,” 08-MAG-02735, by the U.S. District Court for the Southern District of New York (Manhattan). SEC, New York associate director of enforcement, Andrew M. Calamari, asked the judge to issue seizure orders on the firm and its assets, and appoint a receiver. The SEC pleads, among others, that “it was an ongoing $50 billion swindle; our complaint alleges a stunning fraud that appears to be of epic proportions.” It further accused the defendant of “paying returns to certain investors out of the principal received from other, different investors” for years. Madoff’s hedge fund business had previously claimed to have served between 11 and 25 clients and had $17.1 billion in assets under management. But virtually all of the assets were missing.

United States District Court for the Southern District of New York Louis L. Stanton on Thursday appointed Lee Richards, a Manhattan lawyer, as the firm’s receiver. A hearing is set for Friday, for a ruling on the SEC’s petition to grant plenary powers to the receiver over the entire firm, and an absolute asset sequestration.

Doug Kass, president of hedge fund Seabreeze Partners Management said that “this is a major blow to confidence that is already shattered — anyone on the fence will probably try to take their money out.”

Monday, July 5, 2021

On Friday, a ransomware attack which initially targeted software company Kaseya spread to over 200 companies in the US through Kaseya’s network management software. Huntress Labs, a cybersecurity company, alleged the attack was carried out by REvil, a Russia-based ransomware group. Kaseya told its customers to stop using its services when it learned of the attack.

According to NBC News, the ransomware first spread to about 40 of Kaseya’s customers, which are mainly companies that manage Internet services for their customers, some of which manage them for thousands of companies. John Hammond, a security researcher at Huntress Labs, said that “It’s reasonable to think this could potentially be impacting thousands of small businesses”. Kaseya notified its customers of the attack on Friday afternoon and warned them to stop using its services immediately.

Business Insider reported REvil is a Russian-based organization which provides ransomware-as-a-service. BleepingComputer reported receiving a sample of the ransomware used in REvil’s attacks and says that they demand USD five million for the ransomed files to be decrypted, though it is unknown if every victim received a demand for that same amount. Fabian Wosar, Chief Technical Offier (CTO) at the Emsisoft security firm, said affected customers had received demands for USD 44,999.

Swedish grocery chain Coop was also affected by the attack, and had to close all 800 of its stores because its checkout tills could not process payments due to the ransomware. Speaking to Swedish Television, Therese Knapp, a Coop spokesperson, said “We have been troubleshooting and restoring all night, but have communicated that we will need to keep the stores closed today”. Swedish company Visma Esscom, which manages servers for businesses, was using Kaseya software, according to Reuters. Railway services in Sweden were also disrupted.

On Saturday, US President Joe Biden directed intelligence agencies to investigate who was behind the attack. He said that “we’re not certain” who is behind the attack, adding “[t]he initial thinking was it was not the Russian government but we’re not sure yet”. The US Cybersecurity and Infrastructure Security Agency stated that it is “taking action to understand and address the recent supply-chain ransomware attack”.

Monday, November 27, 2006

Michael Chong, Minister of Intergovernmental Affairs, Minister of Sport, and MP for the riding of Wellington—Halton Hills, has resigned over Stephen Harper’s Quebec motion. The motion asks MPs if Quebec is a nation “within a united Canada”.

Chong opposed the vote saying that it was akin to ethnic nationalism, which he opposes.

“It is nothing else but the recognition of ethnic nationalism, and that is something I cannot support. It cannot be interpreted as the recognition of a territorial nationalism, or it does not refer to the geographic entity, but to a group of people,” Chong said.

“I am resigning as minister so I can abstain from the vote tonight,” Chong said at a news conference in Ottawa, the nations capital. “While I am loyal to my party and to my leader, my first loyalty is to my country. I believe in one nation undivided called Canada.”

Chong remains a Conservative member of Parliament. Later in the day, Prime Minister Stephen Harper appointed York—Simcoe, Ontario MP Peter Van Loan to the position vacated by Chong.

Harper asked Liberal race contender Stéphane Dion for guidance with the Quebec motion instead of asking the now former Intergovernmental Affairs Minister, Michael Chong.

Michael Ignatieff, the front-runner in the Liberal leadership race, has proposed a similar motion. Liberal leadership candidate, Gerard Kennedy, said he opposes the motion and finds it divisive to national unity and could advance the separatist agenda.

The vote will be held tonight in the House of Commons.

Saturday, March 1, 2008

Northrop Grumman and Airbus parent company European Aeronautic Defence and Space Company EADS N.V. (EADS) have unexpectedly defeated Boeing for a US$40 billion (GB£20.1 billion) contract to supply the United States Air Force (USAF) with 179 new aerial refueling tankers at a rate of 15 a year.

It is the biggest contract of its kind since the Joint Strike Fighter program. That contract was fought for between Boeing and Lockheed Martin, Lockheed ultimately winning the contest.

JSA Research defence analysist Paul Nesbit said that Maintenance, Repair and Overhaul (MRO) operations across the aircraft’s fifty-year service life could push the value of the contract as high as US$100 billion. Northrop Grumman CEO Ron Sugar said in an interview “Everyone told us we were crazy, that we had no chance. But we took a big swing and in this case, we hit a home run.”

USAF officials said that the contract had been awarded based on competence, track record and competitive pricing, with UBS analyst David Strauss saying “The key decision was the amount of fuel the bigger plane could carry. In the armed services, you can never have too much gas in the air.” USAF also denied that creating jobs in the US was a factor; job supply had been the reason Boeing were expected to win, with the airframer promising 44,000 new positions at 300 suppliers in 40 states.

The Northrop Grumman KC-45 tankers – more often known as KC-30s – are based on the Airbus A330 MRTT. The first four aircraft will be assembled at the main Airbus factory in Toulouse, France but by 2010-11 production of the remainder will be carried out at a facility in Mobile, Alabama. This is thought likely to create 1,500 to 2,000 jobs and support 25,000 others. 60% of the parts will be supplied by domestic manufacturers. EADS had previously announced plans to shift much production to the US due to the current weakness of the dollar.

General Arthur Lichte, head of USAF’s Mobility Command, said it is hoped the first aircraft can be tested in 2010 and in operation three years afterwards. USAF’s chief of staff General Duncan McNab stated “The tanker is the number-one procurement priority for us right now. It is the first step in our critical commitment to recapitalize our aging fleet to move, supply, and position assets anywhere.”

There is still a possibility of Boeing challenging the decision; Boeing themselves were successfuly challenged by Lockheed and Sikorsky in 2006 over a US$10 billion contract to supply search and rescue helicopters to the Pentagon. A statement by Boeing given by Boeing spokesman William Barksdale said “Obviously we are very disappointed… Once we have reviewed the details behind the award, we will make a decision concerning our possible options.”

Washington senator Patty Murray, who hails from the same state where Boeing bases their commercial airliner operations, said in a critical statement “We are shocked that the Air Force tapped a European company and its foreign workers to provide a tanker to our American military. At a time when our economy is hurting, this decision to outsource our tankers is a blow to the American aerospace industry, American workers and America’s military.”

Washington representative Norm Dicks said he too was “shocked”, releasing a statement saying “This decision is even more disappointing because the Air Force had previously favored the Boeing 767 tanker and we were prepared to move forward with the production of 100 tankers in 2003, before the process was halted due to the Boeing scandal. I regret that it has taken so long to respond to what was—and is—an urgent need to replace these older aircraft. And even more regrettable is the decision to award the contract to Airbus, which has consistently used unfair European government subsidies to take jobs away from American aircraft workers.”

Kansas senator Sam Brownback said “It’s stunning to me that we would outsource the production of these airplanes to Europe instead of building them in America. I’ll be calling upon the Secretary of Defense for a full debriefing and expect there will be a protest of the award by Boeing.” Todd Tiahrt, a Kansas representative, said “We should have an American tanker built by an American company with American workers. I cannot believe we would create French jobs in place of Kansas jobs.”

A group of Washington politicians released a joint statement saying “We will be asking tough questions about the decision to outsource this contract… At a time when our economy is hurting, this is a blow not only to our state, but more than 40 states across the country who would help build this national plane.”

Alabama Governor Bob Riley said “To say this is a great day for Alabama is a monumental understatement. This will go down in history as one of our greatest days.” Ralph Crosby, EADS’s North America CEO and ex Northrop executive commented the business has “committed our full resources to support this vital program for our prime contractor, Northrop Grumman, the Air Force, and the war fighters that this system will serve for decades to come. We already have begun the work necessary to expand our U.S. industrial footprint in support of this important program.”

EADS chief executive Louis Gallois commented “This major selection is a win-win for our customers, for allied industrial cooperation and for EADS. It signals a quantum-leap forward in our commitment to the US defence customer, reflects and supports our global strategy to increase EADS’s industrial presence in key markets and our goal to balance the company’s defence and commercial portfolios.” General Arthur Lichte said “This will be an American tanker, flown by American airmen with an American flag on its tail and, every day, it will be saving American lives.

Boeing had initially agreed to lease 100 tankers, but in 2003 a scandal erupted when it emerged that Boeing executive Michael M. Sears arranged a job for USAF official Darleen Druyun while negotiations were still underway. Both served jail sentences for corruption charges and a competition was opened up to award a new contract.

Sunday, September 18, 2005

Monday, February 14, 2005

Three U.S.-government sources have reported the existence of U.S. military drone flights made over Iran, carrying surveillance equipment and particle filters capable of detecting nuclear materials. Confusingly, U.S.-military sources denied the overflights.

Iranian military personnel said they were aware of them, and sightings had prompted a number of UFO reports in the area of Iranian nuclear installations. They viewed them as provocative and probably designed to trick the Iranians into turning on their radar so that the US could determine potential targets.

Because Iran does not have political ties with the US, it has formally issued its objections to the flights through Swiss diplomats.

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Friday, October 9, 2009

A bus driver thought to have caused a 2008 crash after falling asleep behind the wheel in California has been convicted of killing eleven on board. Quintin Watts was found guilty of eleven counts of gross vehicular manslaughter and 21 counts of causing great bodily injury.

Watts was driving a coach carrying 41 Hmong and Mien people from Sacramento to the Colusa Casino Resort. The vehicle left the country road it was traveling on and rolled over in Colusa County. Most of those on board were elderly.

Watts’ stepfather Daniel Cobb, who owned the bus company, was amongst those killed. A jury took three hours to return guilty verdicts against the 53-year-old driver, who now faces a maximum of 76 years in jail at his November 4 sentencing.

Thursday, November 2, 2006

The Group of Ministers which is overseeing the issue has decided not to resume the sealing of unauthorised commercial establishments until Monday. The decision came after seeing the current tense situation in New Delhi.

The Group of Ministers is headed by Home minister Shivraj Patil and comprised of Law minister H R Bhardwaj, Delhi CM Sheila Dikhit, Union Urban Development minister S Jaipal Reddy and his deputy Ajay Makan.

S Jaipal Reddy told reporters that it is very difficult to conduct the sealing drive in the city under these circumstances. He made the statement after a meeting of Group of Ministers.

The Supreme Court had already sent the notice to Municipal Corporation of Delhi to resume the sealing drive from Thursday. They will approach the apex court on Friday and will apprise the court about the difficulties in carrying out the sealing drive in these circumstances where the traders are going on strike and creating situation of tension in the capital.

Supreme Court’s Monitoring committee called on the MCD to resume the sealing of unauthorised shops in the city on Friday.

Friday, March 31, 2006

Canada has become the first western country to freeze aid and cut diplomatic ties to Palestine after the Palestinian Legislative Council installed a government led by Hamas. No other country has yet followed through on threats to end aid to the Palestinian Authority. Aid may still go to Palestine through the United Nations.

The Canadian Arab Federation head, Faraj Nakhleh, later expressed his dismay at the decision, which he says will harm the interests of the 3.5 million Palestinians who are at risk of starvation.