Italy Seizes Millions in Assets from Four Banks
With municipal bond investigations spreading to Europe from the United States, Italian authorities have seized about $300 million in assets of four global banks — JPMorgan Chase, Deutsche Bank, UBS and Depfa — whose officials have been accused of fraud.
The Guardia di Finanza in Milan, the financial police of Italy, took over real estate properties, bank accounts and stock holdings on Monday to assure it could collect from the banks if their officials were found guilty and the banks were held responsible.
The seizures stem from the banks’ handling of a $2.2 billion municipal bond issue and related financial contracts known as swaps that Milan undertook to retire other debt in June 2005. The lead prosecutor accused the bankers of misleading the city and falsely claiming that the deal would generate savings. If all the costs had been properly included, the prosecutor said, the entire deal would have been illegal under a national law that allows restructuring of debt only if it produces a savings.
Alfredo Robledo, the prosecutor in Milan, suspects the banks made $130 million in illicit profits, according to information obtained in a joint investigation by the Italian business newspaper Il Sole 24 Ore and The International Herald Tribune. He is also investigating transactions by the banks with other local Italian governments and the possibility that public officials received kickbacks.
U.S. Plans Attack and Defense in Web Warfare
Just as the invention of the atomic bomb changed warfare and deterrence 64 years ago, a new international race has begun to develop cyberweapons and systems to protect against them.
Thousands of daily attacks on federal and private computer systems in the United States have prompted the Obama administration to review U.S. strategy. President Barack Obama is expected to propose in coming days an expansion of the $17 billion, five-year program that Congress approved last year, the appointment of a White House official to coordinate the effort, and an end to a running bureaucratic conflict over cyberturf.
The most exotic innovations under consideration would enable a Pentagon programmer to surreptitiously enter a computer server in Russia or China, for example, and destroy a “botnet” — a potentially destructive program that commandeers infected machines into a vast network that can be clandestinely controlled — before it could be unleashed in the United States.
Or U.S. intelligence agencies could activate malicious code that is secretly embedded on computer chips when they are manufactured, enabling the United States to take command of an enemy’s computers by remote control over the Internet. That, of course, is exactly the kind of attack officials fear could be launched on U.S. targets, often through Chinese-made chips or computer servers.
Sides Line Up on Sales Tax Increase In Massachusetts
Lobbyists lingered in the Massachusetts State House Monday, stopping lawmakers in the halls and urging them to reject tax hikes. On the other side of the issue, advocates for the homeless and mentally ill marched with union officials, filling the corridors with chants of “Raise Revenues! Stop the cuts!”
The targets of their fervor: state representatives who began debating whether to help solve the state’s recession-induced budget crisis by increasing the state sales tax to 6.25 percent from 5 percent.
“We had perfect attendance of all the special interests,” said Representative John Quinn, Democrat of Dartmouth.
Business groups, restaurants, healthcare companies, and unions were all represented. The state’s retailers argued against the sales tax hike, which represents a 25 percent increase in the tax, saying it would be disastrous for businesses crippled by the recession and would send customers fleeing north.
James Klocke, executive vice president of the Greater Boston Chamber of Commerce, said his group’s members were lobbying against a sales tax hike, instead favoring an increase in the gas tax of 25 cents a gallon.
“We think the most pressing financial need is on the transportation front,” Klocke said. “The gas tax would be dedicated to both the prevention of a toll increase and fixing the MBTA’s finances.”
Circulation Still Falling
US newspapers, already squeezed by falling advertising revenues, suffered steep circulation declines in the six-month period ended in March, with both The Boston Globe and Boston Herald taking large hits, according to a report released Monday.
The Globe’s paid daily circulation fell 13.7 percent, to 302,638 copies, while that of the Boston Sunday Globe dropped 11.3 percent, to 466,665, compared to the same period last year, according to the Audit Bureau of Circulations figures.
The Herald’s daily circulation fell at an even greater rate, down 17.4 percent to 150,688 copies; paid subscriptions of its Sunday paper fell at slower rate, down 9.6 percent to 95,392.
Local newspapers owned by GateHouse Media Inc., such as the Enterprise of Brockton and The Patriot Ledger of Quincy, took smaller hits, with the daily Patriot Ledger down 6.2 percent and the Enterprise down 5.5 percent, the report noted.
Nationwide, daily circulation of 395 newspapers in the survey fell an average of 7.1 percent from the same six-month period a year earlier, according to the bureau. That’s nearly double the rate of decline from the March 2008 period, when daily circulation fell 3.6 percent.