One year after Och-Ziff Capital settled a bribery case that led to jump in redemption requests and an exodus in high profile executives, on Tuesday the hedge fund reported that it suffered record net withdrawals in the first four months of the year, extending several straight quarters of outflows. The firm reported net redemptions of $4.8 billion in the first quarter and an additional $2.1 billion from April 1 and May 1. At the same time, assets under management declined from $37.9 billion as of December 31, 2016 to $32 billion as of the beginning of May, a record $5.9 billion decline, and a 24% drop from a year earlier. As discussed at the time, and as Bloomberg reminds this morning, the redemption wave started when the hedge fund settled a five-year bribery probe and saw founder Dan Och singled out by regulators for ignoring red flags and corruption risks. Och-Ziff agreed to pay more than $400 million in September to settle U. S. charges that it paid bribes to gain business in Africa. Its OZ Africa Management GP unit pleaded guilty to conspiring to bribe officials of the Democratic Republic of Congo.
This post was published at Zero Hedge on May 2, 2017.
Growth in U. S. personal consumption expenditures in the first quarter of 2017 was slowest since 2009, according to data released Friday by the Commerce Department. A big reason for that was the second-largest contraction in spending by non-profits (i.e. election-related lobbying/spending) in 57 years of data. As Bloomberg details, according to monthly consumption data through February, the drag seems to owe to a sharp decline in spending by professional advocacy groups, which always surges during U. S. presidential elections, and hit a record high in November.
This post was published at Zero Hedge on May 1, 2017.
Former national security adviser Michael Flynn likely broke the law by failing to disclose foreign income he earned from Russia and Turkey, the heads of the House Oversight Committee said Tuesday. As The Washington Post reports, committee chairman Jason Chaffetz (R-Utah) and ranking member Elijah Cummings (D-Md.) said they believe Flynn neither received permission nor fully disclosed income he earned for a speaking engagement in Russia and lobbying activities on behalf of Turkey when he applied to reinstate his security clearance, after viewing two classified memos and Flynn’s disclosure form in a private briefing Tuesday morning.
This post was published at Zero Hedge on Apr 25, 2017.
“Inequality is a euphemism, a kind of shorthand, for all of the things that have gone to make the lives of the rich so much more delicious, year on year, for the last three decades. And also for the things that have made the lives of working people so wretched and so precarious in that same time. This word inequality. It’s visible in the ever rising costs of healthcare and college, in the coronation of Wall Street, and the slow blighting of wherever it is that you happen to live. And you catch a glimpse of inequality every time you hear about someone that had to declare bankruptcy because a child got sick, or you read about the lobbying industry that drives Washington DC, or the new political requirement, the new constitutional requirement that every presidential candidate has to be a billionaire’s favorite, or a billionaire themselves. Inequality is about the way in which speculators, and even criminals, get a helping hand from Uncle Sam, while the Vietnam Vet down the street from you loses his house. Inequality is the reason that some people find such incredible significance in the ceiling height of an entrance foyer, or the hop content of a beer, while other people will never believe in anything again.” Thomas Frank “People of privilege will always risk their complete destruction rather than surrender any material part of their advantage. Intellectual myopia, often called stupidity, is no doubt a reason. But the privileged also feel that their privileges, however egregious they may seem to others, are a solemn, basic, God-given right. The sensitivity of the poor to injustice is a trivial thing compared with that of the rich.” John Kenneth Galbraith
Fox News Channel parent News Corporation may be wrapped up in the sexual harassment accusations surrounding host Bill O’Reilly, but, as International Business Times’ Lydia O’Neal reports, the company is facing another long-running scandal involving what appear to be exuberant payments to a Democrat – payments that occurred even as News Corp. was lobbying the New York State executive branch, which Gov. Andrew Cuomo oversees. *** The New York governor, whose memoir was published by the News Corp.-owned HarperCollins in 2014, saw his gross income more than double last year, to $417,748 for 2016 (from $196,243 the year before), the Buffalo News reported Tuesday. Cuomo attributed $218,100 of that increase to sales of his memoir, ‘All Things Possible: Setbacks and Successes in Politics and Life.’ In 2015, the governor reportedly earned zero income from book sales and in the nearly three years that it’s been on the market, it has sold just 3,200 copies. But Cuomo, the Buffalo News found, reported that he received a total of $783,000 from HarperCollins in book sales over the past three years, a number that would translate to royalty payments of nearly $244.69 per copy. Today, the book was selling on Amazon for $8.45.
This post was published at Zero Hedge on Apr 23, 2017.
‘Corporate fraud is a major challenge in both developing and advanced economies, and employee whistle-blowers play an important role in uncovering it.’ A truism that is, despite being quite obvious, has been a subject of too little research to-date. One recent study by the Association of Certified Fraud Examiners (2014), found that the average loss to organisations experiencing fraud that occurs due to financial statement fraud, asset misappropriation, and corruption is estimated losses from impact of corporate fraud globally at around $3.7 trillion. Such estimates are, of course, only remotely accurate. The Global Fraud Report” (2016) showed that 75% of surveyed senior executives stated that their company was a fraud victim in the previous year and in 81% of those cases, at least one company insider was involved, with a large share of such perpetrators (36%) coming from the ranks of company senior or middle management. Beyond aggregate losses, whistleblowers are significantly important to detection of fraud cases. A 2010 study showed that whistleblowers have been responsible for some 17 percent of fraud discoveries over the period of 1996-2004 for fraud occurrences amongst the large U. S. corporations. And, according to the Association of Certified Fraud Examiners (2014), ‘employees were the source in 49% of tips leading to the detection of fraud’.
This post was published at True Economics on Saturday, April 22, 2017.
Reporting from Lake Atitlan, Guatemala… Interpol helicopters swam through the darkness outside my room. Scattered booms of M-80s cracked and whipped the rushing winds in celebration of Semana Santa. Dogs roared. Other strange animals, of which your editor is not yet accustomed to, howled, hooted and growled in vain efforts, it seemed, to beat back the chaos. Saturday evening, as my driver, Ricardo, pulled into Panajachel (the ‘New York’ of Lake Atitlan), so did a swarm of Interpol officers. They came to capture the fugitive ex-governor of Veracruz, Javier Duarte de Ochoa. Coincidentally, those who conspired to help Duarte make his way to Lake Atitlan, according to authorities, did so from Mexico City… from where I just flew in. (For the record, I’ve never seen that man before in my life!) Six months ago, Duarte resigned from his position as governor of Veracruz to, according to him, ‘fight the corruption charges’ made against him. (Racketeering, theft, money laundering, bribery… you know, the usual) A few days later, he vanished without a trace.
Taxpayers are forced to cover much of the costs of defense attorneys for highly-paid federal managers facing termination or criminal charges, thanks to a cozy deal engineered in part by a law firm whose lobbyists helped draft and gain passage of legislation requiring it, The Daily Caller News Foundation’s Investigative Group (TheDCNF) has found. Lobbyists for the Washington, D. C., law firm Shaw, Bransford & Roth (Roth) – which earns its money representing federal employees who are being disciplined – ‘proposed’ and secured passage of the obscure bill Congress passed in 1996, according to the website of a group connected to the firm. That bill requires taxpayers to pay for legal insurance for management-level employees. Roth lawyer Anthony Vergnetti then left the firm to launch the Federal Employee Defense Services (FEDS), just such a legal insurance business that, Vergnetti acknowledges, primarily steers clients to Roth when they have insurance claims, and profits off their premiums when they don’t. Roth got its legislative sway by operating through the Senior Executives Association (SEA), which is ostensibly an organic group representing managers, but which is actually founded and run by the law firm’s partners and employees, as TheDCNF showed last year. SEA collects dues from members and pays lobbyists from Roth to conduct legislative advocacy, according to lobbying disclosures.
It appears that at least one “Nigerian prince” had the cash to back his claims. Nigeria’s anti-corruption unit discovered more than $43 million in US dollars at an upscale apartment in Lagos, after receiving an anonymous tip. As CTV News reports, the Economic and Financial Crimes Commission received a tip from a whistleblower who reported suspicious activity when they noticed someone moving bags in and out of the apartment, according to a Facebook post.
This post was published at Zero Hedge on Apr 16, 2017.
One of the reasons that Syria is ‘on hold’ is that the Russians are now leveraging the President with the connections formed in his campaign prior to the election. Paul Manafort, onetime manager of President Trump’s campaign apparently has received payments from a pro-Russian political party in Ukraine. An article covering it entitled Manafort firm received Ukraine ledger payout by Jack Gillum, Chad Day, and Jeff Horwitz was released on Thursday by the Associated Press. The bad news is that the ledger is substantiated by records booked by Manafort’s consulting firm in the U. S., already under a corruption investigation by the FBI with even more overlap. Apparently, the FBI and Congress are investigating Manafort’s activities with Russia and possible ties to Vladimir Putin regarding the President’s campaign. These activities which could have included payoffs allegedly occurred in 2016. But a distinct pattern is observable here. Tillerson is still ‘on the attack,’ today demanding that Russia oust Syrian President Bashar al-Assad…and the President in the meantime has announced we wouldn’t be sending troops into Syria. Perhaps he is hesitant, as (if they have such evidence) Russia would certainly not shirk from releasing information that could be damaging to the President. At this stage, the threat of such a release appears to be keeping things in check: we haven’t launched another Tomahawk strike yet.
This post was published at shtfplan on April 14th, 2017.
News coming out of Venezuela over the past two years has reeked of corruption and failed political leadership: a long list of shortages, rampant poverty, incrimination of the opposition, and a recent move that puts the regime of Nicolas Maduro one step closer to a dictatorship. And these are only the developments that are recorded, with a recent LA Times Op-Ed suggesting that a Venezuelan homicide epidemic rages ‘unreported’ due to the country’s scrapping of crime statistics reporting over a decade ago. Despite all of this, the Organization of Petroleum Exporting Countries (OPEC) expects Venezuela, endowed with the world’s largest oil reserves (depending on who you ask), to play a major role in the cartel’s plan to curb global supply. In OPEC’s November agreement, Venezuela accounted for almost 10 percent of the net supply cut from member nations (calculated as cuts minus allotted increases)
This post was published at Zero Hedge on Apr 11, 2017.
The world’s eyes and ears have once again turned toward Syria following last week’s chemical weapons attack and U. S. President Donald Trump’s subsequent air strikes on the Assad government. Mainstream media, independent media, and social media platforms are fixing fierce attention on the ongoing developments. These events undoubtedly deserve widespread, ongoing scrutiny. From the United States government’s lack of evidence that the Syrian government was behind the chemical attack to the media’s complicity in driving a pro-war narrative and president Trump’s hypocrisy in bombing Syria – after criticizing former president Barack Obama for doing the same thing – further critical analysis of the recent airstrikes is vital. But even as skepticism toward these events should remain heightened, so should awareness of countless other major developments. Here are five to follow: 1. Trump Appoints Pharmaceutical Consultant to Head the FDA – This week, the president appointed Scott Gottlieb, a pharmaceutical industry insider who has served the boards of multiple pharmaceutical companies, to chair the Food and Drug Administration. Gottlieb currently still works as a consultant for GlaxoSmithKline. He has received $414,000 from GSK, Pfizer, AstraZeneca, Bristol-Myers Squibb, and Valeant Pharmaceuticals. He has also received tens of thousands of dollars in speaking fees from pharmaceutical companies like Merck and Mikart, as well as other corporations – including Goldman Sachs. He has taken several trips through Washington’s revolving door, with brief stints at the FDA mixed in with multiple positions consulting pharmaceutical companies. Trump’s pick follows in the footsteps of Barack Obama, who also appointed a pharmaceutical industry insider to chair the FDA.
Three organizations have filed lawsuits against President Trump’s administration for not publicly disclosing White House visitor logs. According to The Hill, the lawsuits were filed against the Department of Homeland Security by The National Security Archive, Citizens for Responsibility and Ethics in Washington (CREW), and the Knight First Amendment Institute at Columbia University after the administration failed to release the records pursuant to several Freedom of Information Act (FOIA) requests. ‘We hoped that the Trump administration would follow the precedent of the Obama administration and continue to release visitor logs, but unfortunately they have not.’ CREW Executive Director Noah Bookbinder said in a statement. ‘Given the many issues we have already seen in this White House with conflicts of interest, outside influence, and potential ethics violations, transparency is more important than ever, so we had no choice but to sue.’ ‘President Obama routinely released the data we’re seeking with no damage to presidential privilege, and this information is central to the Secret Service mission and thus clearly agency records subject to FOIA,’ Tom Blanton, the director of the National Security Archive, said in a statement.
This post was published at Zero Hedge on Apr 10, 2017.
With the recent crackdown on political “fake news”, where a handful of media mega-corporations such as Facebook and Google have emerged as the ultimate arbiter of what is real or isn’t, in the process unleashing allegations of conflicts of interest, it was only a matter of time before the SEC got the hint and brought the hammer down. That time is now, because as Reuters reports, the SEC on Monday announced a crackdown against “pump and dump” stock promotion schemes in which writers were secretly paid to post hundreds of bullish articles about public companies on financial websites. Some 27 individuals and entities, including a Hollywood actress (shown below), were charged with misleading investors into believing they were reading “independent, unbiased analyses” on websites such as Seeking Alpha, Benzinga and Wall Street Cheat Sheet. The SEC said many writers used pseudonyms such as Equity Options Guru, The Swiss Trader, Trading Maven and Wonderful Wizard to hype stocks. It was not immediately clear if bearish “pseudonymous characters” were also responsible for talking down stocks. While not as pervasive as alleged “fake news” in the political realm, the SEC said had it identified more than 450 problem articles, of which more than 250 falsely said the writers were not being paid. Unlike traditional cases where the SEC alleges fraud, usually involving trading on inside information, in this case the crackdown is not against improper market information but misrepresentation of conflicts of interest and marketing. “This is different from the fraud cases that you usually see us bring,” Stephanie Avakian, acting director of the SEC enforcement division, said on the conference call. “Here, we allege that the fraud was in presenting the analysis as impartial,” she said. “It was bought and paid for.”
This post was published at Zero Hedge on Apr 10, 2017.
Submitted by James Durso ‘The lion is back in his den!’ Hosni Mubarak, former President of Egypt, walked free last week after six years in detention on charges of murder and corruption. What does the U. S. have to show for it? Nothing. In January 2011, Egyptian activists planned protests against corruption, lack of economic growth, and the heavy-handed police tactics of the recent years. The protests were scheduled for 25 January in Cairo and across Egypt. A broad swath of Egyptian activist groups participated, including the Islamists. The protests quickly escalated and became increasingly violent to the extent that the police were replaced by the military. At the end of two weeks, Mubarak had dissolved his government, appointed an interim leader, and announced he would not seek re-election in the September 2011 elections. In early February 2011, on the same day that Vice President, and former intelligence chief, Omar Suleiman announced that Mubarak would resign as President, the Supreme Council of the Armed Forces suspended the constitution and dissolved both houses of Parliament for six months until elections could be held. In May 2011, Mubarak was charged with the murder of protesters and ordered to stand trial. The elections of June 2012 handed power to the only organized opposition group, the Muslim Brotherhood and its leader, Mohammed Morsi, who promptly tried to install an Islamist constitution and grant himself broader power than had Mubarak. The secular opposition was upset that the Islamist opposition they helped usher into power would be so… Islamist. More violent protests ensued. The whole sorry mess came to an end in July 2013, when the military seized power and Morsi’s hand-picked minister of defense, General Abdel Fattah El-Sisi, became Egypt’s leader and was elected President in May 2014 with a Chicago-like 93 percent of the vote.
This post was published at Zero Hedge on Apr 4, 2017.
President Trump night released details of the personal finances of his staffers late on Friday, including his son-in-law Jared Kushner and daughter Ivanka, which once again confirmed that most of the people in his immediate circle are very wealthy. The legally required disclosure documents provided a snapshot of assets and positions held by personnel when they first entered their new jobs at the White House, and before they started selling stocks and other assets that could pose conflicts of interest, according to White House ethics officials. Curiously, the White House did not actually create a public depository of the filings, so AP, Propublica and the NYT created a shared drive for all the disclosures so far. .@nytimes @AP @politico And we're off. Since the White House is not posting the documents publicly, we ( @nytimes @AP) are: — ProPublica (@ProPublica) March 31, 2017
This post was published at Zero Hedge on Apr 1, 2017.
After being formally impeached just three weeks ago, former South Korea President Park Geun-hye was arrested on Friday in connection with a corruption scandal that led to her removal from office, Yonhap reports.
This post was published at Zero Hedge on Mar 30, 2017.
Transparency International whacks at a central bank. The European Central Bank has found itself in the rare position of having to defend itself in the public arena following the release of a scathing report on its perceived lack of political independence. The report, published by anti-corruption watchdog Transparency International, argues that the institution has accrued new power and influence in the wake of the financial crisis but its code of conduct has not kept up with that newfound clout. It even suggests that the ECB should withdraw from the Eurozone’s Troika of creditors, precisely at a time that calls are rising for the creation of a European Monetary Fund. ‘The extraordinary measures taken by the ECB since 2008 have tested the ECB’s mandate (to ensure price stability) to breaking point,’ Transparency International EU said. ‘The ECB’s accountability framework is not appropriate for the far-reaching political decisions taken by the Governing Council.’
This post was published at Wolf Street on Mar 29, 2017.
Fox News’ legal analyst Andrew “Judge” Napolitano returned to the air on Wednesday morning, nine days after the network benched him when President Donald Trump cited the Fox talking head as the source of claims that Barack Obama used British intelligence to wiretap him. Napolitano refused to change his story saying he stood by his claim about spying on President Donald Trump that got him benched by the network on March 21 for an indefinite period. ‘I stand by my statement on surveillance,’ Napolitano told Bill Hemmer. According to Deadline, Napolitano was there to talk about a Fox News report that the FBI allegedly wired a staffer of former Illinois Congressman Aaron Schock, who has been charged with fraud and corruption. But first, Hemmer asked Napolitano about that Obama/Brit intel wiretap claim he first made on Fox & Friends. Napolitano said that was his story and he was sticking to it.
This post was published at Zero Hedge on Mar 29, 2017.
On January 1, 1994, the North American Free Trade Agreement (NAFTA) officially came into effect, virtually eliminating all tariffs and trade restrictions between the United States, Canada, and Mexico. As Visual Capitalist’s Jeff Desjardins reminds readers: Bill Clinton, who lobbied extensively to get the deal done, said it would encourage other nations to work towards a broader world-trade pact. ‘NAFTA means jobs. American jobs, and good-paying American jobs,’ said Clinton, as he signed the document, ‘If I didn’t believe that, I wouldn’t support this agreement.’ Ross Perot had a contrary perspective. Lobbying heavily against the agreement, he noted that if it was ratified, Americans would hear a giant ‘sucking sound’ as jobs went south of the border to Mexico. IT’S A COMPLICATED WORLD Fast forward 20 years, and NAFTA is a hot-button issue again. Donald Trump has said he is working on ‘renegotiating’ the agreement, and many Americans are sympathetic to this course of action.
This post was published at Zero Hedge on Mar 29, 2017.