Daily Archives: June 8, 2016

Thanks AP for screwing Tuesday’s night primary voters: AP became the story instead of reporting the story.

By William Rivers Pitt, Truthout | Op-Ed

Thanks to The Associated Press, I was awake well past midnight on Wednesday morning watching a series of non-events come to a grateful conclusion. I wanted to see the speeches, especially Bernie’s, which came after 1:00 am; they were the one thing the “news” media couldn’t screw up. How did Tuesday’s primaries become non-events? Because The Associated Press on Monday night, straight out of the blue, declared Secretary Clinton to be the presumptive Democratic nominee for president.

Wait, what? Yeah, they did that. They polled a bunch of Democratic Party elites — “superdelegates” — and decided Clinton had enough delegates to call it a day. The margin? One delegate. Five primaries and a caucus that would have decided the race fair and square 24 hours later got tossed into the dustbin because the AP wanted the hot take, the big scoop, and in doing so broke a cardinal rule of journalism: They became the story instead of reporting the story.

The “news” media’s reaction to that declaration was like tossing a live hand grenade into a hedge filled with chickadees: lots of squawking and flapping and smoke and a ringing in the ears from the explosion. All the AP had to do was wait a day. They didn’t, and it was a mess. Beyond the impact on the presidential side, there are the down-ticket races to consider. The AP’s little wingding certainly depressed voter turnout across the board — exactly 354 people voted in the North Dakota Democratic caucus on Tuesday — and that depressed turnout affected down-ticket races all over the country.

Sanders supporters by and large have been reading the writing on the wall for a while. All they wanted was the opportunity to die on their feet, to take it to the end and let the chips fall. Now? They’re pissed and feeling cheated. We’re deciding nominees through polls of party elites? It was as undemocratic an act as I have ever witnessed after Bush v. Gore and the shenanigans in Ohio in 2004, and there will be consequences down the line, especially for Clinton. Good luck bringing Bernie’s folks into the fold for the big push to November after that crud. It was disgraceful.

Read on.

BEAUMONT, CA CITY OFFICIALS EMBEZZLEMENT PROBE: A $300 million mystery solved

TIMELINE

April 2015: Investigators from the FBI and Riverside County District Attorney’s Office raid Beaumont City Hall, the home of then-City Manager Alan Kapanicas and the offices of Urban Logic Consultants, which had business dealings with the city for more than 20 years.

November: A State Controller’s Office review of Beaumont finances finds that accounting controls were effectively nonexistent, making it impossible to know whether hundreds of millions of dollars was spent for the expenditures’ intended purposes.

March 2016: Beaumont decides to serve legislative subpoenas on Union Bank for spending records hoping to learn how hundreds of millions of dollars in city bond funds was spent.

BOTTOM LINE

Thousands of Beaumont homeowners remain on the hook to pay off these bond debts through special taxes added to their county property tax bills known as Mello-Roos assessments.

A city-commissioned report digs into the ways funds were spent over 30 years.

It was a sober reckoning.

Beaumont city officials on Tuesday night heard a long-awaited accounting of how more than $300 million in city bond funds were spent in the last 20 years – which includes money that prosecutors allege was embezzled by former city administrators.

The city-commissioned report by the Orange-based Urban Futures consulting firm has been more than six months in the making. It involved tracking down thousands of bond expenditures ostensibly made to pay for sewers, streets, sidewalks and other public works needed as the city’s population more than quadrupled to more 40,000 people.

“In total we looked at 68,500 pages of documents … and there is still some missing information,” said Michael Busch, Urban Futures’ CEO.

The report found that General Government Management Services, a company owned by former City Manager Alan Kapanicas, received $1.2 million in bond funds, including $451,222 for charges related to issuing the bonds and $512,042 for administrative costs.

It also found that $45.4 million went to Urban Logic Consultants, an engineering and planning firm whose owners – David Dillon, Ernest Egger and Deepak Moorjani – served, respectively, as the city’s economic development, planning and public works directors. They and Kapanicas are among those facing criminal corruption charges.

Most of this money was billed for engineering and project management services. But many of the invoices are vague and list only job titles and the number of hours worked.

“What we can’t tell is what they did,” Busch said.

Read on.

 

 

Who Can Go After Banks for the Foreclosure Crisis?

In the wake of the housing crisis, surprisingly few people or institutions have been held accountable for the risky lending practices that nearly wrecked the U.S. economy.  That’s partly because the people who were most damaged by the foreclosure crisis—the people who lost their homes—don’t have the resources to bring lawsuits.

But the families who lost their homes weren’t the only ones hurt by the foreclosure crisis. So there’s an argument to be made that they shouldn’t be the only ones who can go after the lenders. Cities, for example, lost tax revenue when homes sat vacant, and saw property values within their boundaries decrease when vacant and boarded-up homes sat empty. Cities had to pay for police and fire protection to keep those homes from being vandalized and to respond to reported break-ins and criminal activity at the houses.

So should cities be able to sue the banks, too?

That’s the question making its way through courts across the country after municipalities including Los Angeles, Miami, Oakland, and Providence all filed lawsuits against lenders under the Fair Housing Act. The lawsuits, which the banks are fighting to have dismissed, argue that the lending practices of these banks harmed the cities too. When lenders targeted minorities for risky loans, knowing that the borrowers would likely lose their homes, they knowingly deprived cities of tax revenue while making them shoulder the expenses of blocks of foreclosures, the lawsuits allege. Oakland, for instance, argues in its complaint against Wells Fargo that the city “has suffered economic injury based upon reduced property tax revenues resulting from (a) the decreased value of the vacant properties themselves, and (b) the decreased value of properties surrounding the vacant properties.” Last month a judge declined to dismiss the suit.

Read on.

JPMorgan Power Price-Rigging Suit Is Valid, 9th Circ. Told

Law360, New York (June 8, 2016, 3:15 PM ET) — A proposed racketeering class action accusing a JPMorgan Chase & Co. unit of rigging California electricity prices isn’t barred by a legal doctrine preventing most challenges to wholesale electricity rates set by the Federal Energy Regulatory Commission, the plaintiffs told the Ninth Circuit Monday.

JPMorgan and subsidiary J.P. Morgan Energy Ventures Corp. have urged the appeals court to uphold an October decision by U.S. District Judge William Q. Hayes dismissing the suit, in which ratepayers claimed they were forced to pay artificially high prices for electricity…

Source: Law360

New York financial watchdog nominee by NY Gov signals business-friendly tack

New York Governor Andrew Cuomo’s pick to become the state’s top financial regulator on Wednesday signaled she would take a more business-friendly approach than her predecessor, who was known for his pursuit of big banks.

“I believe in compromise to get things done for the benefit of everyone,” Maria Vullo, acting superintendent of the New York State Department of Financial Services (NYDFS), said during a confirmation hearing before the New York State Senate Banks Committee.

Vullo, a lawyer who represented banks and donated to Cuomo’s campaigns, described herself as “pro-business and pro-consumer.” The two terms are not mutually exclusive, she said. Vullo wants the New York financial industry to grow, but also serve lower-income residents whose financial needs are not being met, she said.

“I think you might see creative, innovate initiatives to try to address those concerns,” said Vullo, who must still testify before a finance committee before the state legislature can approve her nomination.

Read on.

Morgan Stanley pays $1 million U.S. SEC fine over stolen customer data

Morgan Stanley has agreed to pay a $1 million fine to settle U.S. Securities and Exchange Commission civil charges that security lapses at the Wall Street bank enabled a former financial adviser to tap into its computers and take client data home, the regulator said on Wednesday.

The settlement resolves allegations related to Galen Marsh’s unauthorized transfers from 2011 to 2014 of data from about 730,000 accounts to his home computer in New Jersey, some of which was hacked by third parties and offered for sale online.

Marsh was sentenced in December to three years probation and ordered to pay $600,000 in restitution after pleading guilty to one felony count of unauthorized access to a computer. Prosecutors had sought prison time.

Read on.

By 2020, half the world’s wealth will be controlled by millionaires

Millionaires will control more than half of the world’s wealth by 2020, according to a new report, with the richest millionaires gaining the most.

The number of millionaire households in the world grew 6 percent in 2015, to 18.5 million, according to the Boston Consulting Group Global Wealth report. The increase marked a slowdown from the 11 percent millionaire growth in 2014.

Still, millionaires currently control 47 percent of the world’s wealth, and will control 52 percent by 2020, according to the report. And the richest of the rich will gain the most, especially in the U.S. Those worth more than $20 million in the U.S. will control 29 percent of the country’s wealth by 2020, up from 24 percent in 2015 and 20 percent in 2010, according to the report.

Read on.