09/10/2013 archive

There are at least two resolutions are being presented to the UN Security Council to have an international agency take control of Syria’s stockpile of chemical weapons and their destruction.

The Russian’s have rejected the US/French resolution and called for the US to drop its threats of military force.

American, British and French diplomats were meeting at the UN in New York on Tuesday night to draw up a resolution that would set deadlines for Bashar al-Assad to give up his chemical weapons backed by the threat of force.

However, a major standoff loomed as Russia made clear it would not abandon its Syrian ally. Instead the Russian foreign ministry said Moscow would push for a security council declaration on disarmament, which would have no binding authority and would not allow the use of force against the Assad regime.

The Russian president, Vladimir Putin, insisted the disarmament process would work “only if the US and those who support it on this issue pledge to renounce the use of force, because it is difficult to make any country – Syria or any other country in the world – unilaterally disarm if there is military action against it under consideration”.

Russia proposes to work with the Assad regime and the UN secretariat to lay out a “workable, precise and concrete” disarmament plan with a timetable but no chapter 7 enforcement mechanism.

Syria has accepted the Russian proposal to place the chemical weapons it possesses under international control.

Syrian Foreign Minister Walid al-Moualem earlier announced that Damascus had agreed to the Russian proposal because it would “remove the grounds for American aggression,” according to an Interfax report.

“We held a very fruitful round of talks with Foreign Minister Sergei Lavrov yesterday, and he proposed an initiative relating to chemical weapons. And in the evening we agreed to the Russian initiative,” Walid al-Moualem was quoted as telling the speaker of Russia’s lower house parliament house in Moscow.

It comes as France plans to submit a resolution to the U.N. Security Council calling for Syria’s chemical weapons stockpile to be turned over to international control, Foreign Minister Laurent Fabius said at a press conference in Paris on Tuesday.

Fabius said that the resolution would threaten “extremely serious” consequences if Syria violates conditions on chemical weapons.

The UN Security Council is scheduled to meet ina closed door session today at 4 PM EDT.

Meanwhile, President Barack Obama is preparing to speak this evening to press his policy for the use of military force to a very skeptical American public. In the light of the latest developments, the speech is expected to take a different direction. It does appear from statements from the White House press office that military intervention will still be an integral part of his policy towards Syria.

In the Senate, the vote on the resolution that passed the Senate Foreign Relations Committee last week was rescheduled for Wednesday. That vote, as well, may not happen as a group of senators craft a new resolution tailored to the recent Russian proposal.

All of this is unlikely to stop the fighting or even guarantee that chemical weapons won’t be used against the Syrian civilian population since no one knows who is in possession of these weapons. What we do know is that this is a small step to use diplomacy to back away from increased hostilities.  

Ex-FBI lawyer linked to surveillance abuses poised for federal judge post

Spencer Ackerman, The Guardian

Friday 6 September 2013 10.08 EDT

A former senior FBI official implicated in surveillance abuses is poised to become a federal judge in one of the US’s most important courts for terrorism cases.

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Caproni has come under bipartisan criticism over the years for enabling widespread surveillance later found to be inappropriate or illegal. During her tenure as the FBI’s general counsel, she clashed with Congress and even the Fisa surveillance court over the proper scope of the FBI’s surveillance powers.

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A 2010 report by the Department of Justice’s internal watchdog found that the FBI misused a type of non-judicial subpoena known as an “exigent letter” to improperly obtain more than 5,500 phone numbers of Americans.

“The FBI broke the law on telephone records privacy and the general counsel’s office, headed by Valerie Caproni, sanctioned it and must face consequences,” said John Conyers, then the chairman of the House judiciary committee, in April 2010, who called for then-FBI director Robert Mueller to fire her.

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In an April 2008 House hearing, Caproni told lawmakers that if a phone number obtained from a telephone company using a nonjudicial subpoena ostensibly authorized by the Patriot Act was unrelated to a “currently open investigation, and there was no emergency at the time we received the records, the records are removed from our files and destroyed”.

In fact, the NSA, at the time of Caproni’s testimony and today, stores phone records such as phone numbers on practically all Americans for up to five years, whether or not they are connected to an “open investigation”.

Numerous intelligence, Justice Department and law enforcement officials have testified this summer that the NSA can pass phone records to the FBI that it has “reasonable articulable suspicion” are connected to terrorism, although NSA deputy director John C Inglis could not cite a single case where the phone records have clearly disrupted a domestic terror attack.

“Caproni knew that the Bush administration could use or was using the Section 215 provision in the Patriot Act to obtain Americans’ phone records on a broad scale, an issue that has recently been documented by the whistleblower material first printed in the Guardian,” said Graves, a former deputy assistant attorney general who dealt with Caproni extensively while working on national security issues for the ACLU.

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A 2008 Justice Department inspector general’s report into surveillance under the Patriot Act found that Caproni clashed with the Fisa court, a secret court that oversees surveillance for the purposes of foreign intelligence, over the scope of the court’s authority.

The heavily redacted report found that in 2006, the Fisa court indicated it would not sign off on an FBI request for business records under section 215 of the Patriot Act – the section used to justify the bulk phone-records database – “because of first amendment concerns.” It is extremely rare for the Fisa court to deny the government a surveillance request.

Caproni, the FBI’s general counsel at the time, “told the OIG [office of inspector general] that the Fisa court does not have the authority to close an FBI investigation,” according to a footnote in the report.

I find it quite telling that after all the revelations about NSA and GCHQ (and for that matter the Bundesnachrichtendienst) eavesdropping, Kerry and the Obama Administration are left with mere assertions we’re supposed to accept on faith alone while the BND is providing actual intercepts that tell a quite different story.

Syrian forces may have used gas without Assad’s permission: paper

Reuters

Sun Sep 8, 2013 8:17am EDT

Syrian brigade and division commanders had been asking the Presidential Palace to allow them to use chemical weapons for the last four-and-a-half months, according to radio messages intercepted by German spies, but permission had always been denied, the paper said.

This could mean Assad may not have personally approved the attack close to Damascus on August 21 in which more than 1,400 are estimated to have been killed, intelligence officers suggested.

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Bild said the radio traffic was intercepted by a German naval reconnaissance vessel, the Oker, sailing close to the Syrian coast.

Intercepts caught Assad rejecting requests to use chemical weapons, German paper says

By Matthew Schofield, McClatchy

Monday, September 9, 2013

Syrian President Bashar Assad has repeatedly rejected requests from his field commanders for approval to use chemical weapons, according to a report this weekend in a German newspaper.

The report in Bild am Sonntag, which is a widely read and influential national Sunday newspaper, reported that the head of the German Foreign Intelligence agency, Gerhard Schindler, last week told a select group of German lawmakers that intercepted communications had convinced German intelligence officials that Assad did not order or approve what is believed to be a sarin gas attack on Aug. 21 that killed hundreds of people in Damascus’ eastern suburbs.

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The newspaper’s article said that on numerous occasions in recent months, the German intelligence ship named Oker, which is off the Syrian coast, has intercepted communications indicating that field officers have contacted the Syrian presidential palace seeking permission to use chemical weapons and have been turned down.

The article added that German intelligence does not believe Assad sanctioned the alleged attack on August 21.

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European foreign ministers on Saturday issued a statement calling the Aug. 21 attack a “war crime,” but said nothing should be done without U.N. approval. New opinion polls over the weekend in France, Germany and Great Britain showed strong disapproval of military action in Syria. The British poll, done for The Sunday Telegraph, indicated only 19 percent of the population backs the idea of military action with the United States, while 63 percent oppose it. The polls in France and Germany showed similar margins of opposition.

Meanwhile, a new tabulation of the dead from the Aug. 21 incident raised more questions about Obama administration officials’ account of what took place.

The Damascus Center for Human Rights Studies, an anti-Assad group, said that it had been able to document 678 dead from the attacks, including 106 children and 157 women. The report said 51 of the dead, or 7 percent, were fighters from the Free Syrian Army, the designation used to describe rebels that are affiliated with the Supreme Military Council, which the U.S. backs.

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U.S. Secretary of State John Kerry has said 1,429 people died Aug. 21, included 426 children, but has not said how the United States obtained the figures. Other estimates have ranged from a low of “at least 281” by the French government to 502, including “tens” of rebel fighters and about 100 children, by the Syrian Observatory for Human Rights, a London-based group that tracks violence in Syria.

Obama’s Case for Syria Didn’t Reflect Intel Consensus

Gareth Porter, Inter Press Service

Sep 9 2013

The evidence indicates that Director of National Intelligence James Clapper culled intelligence analyses from various agencies and by the White House itself, but that the White House itself had the final say in the contents of the document.

Leading members of Congress to believe that the document was an intelligence community assessment and thus represents a credible picture of the intelligence on the alleged chemical attack of Aug. 21 has been a central element in the Obama administration’s case for war in Syria.

That part of the strategy, at least, has been successful. Despite strong opposition in Congress to the proposed military strike in Syria, no one in either chamber has yet challenged the administration’s characterisation of the intelligence. But the administration is vulnerable to the charge that it has put out an intelligence document that does not fully and accurately reflect the views of intelligence analysts.

Former intelligence officials told IPS that that the paper does not represent a genuine intelligence community assessment but rather one reflecting a predominantly Obama administration influence.

In essence, the White House selected those elements of the intelligence community assessments that supported the administration’s policy of planning a strike against the Syrian government force and omitted those that didn’t.

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The issuance of the document by the White House rather than by Clapper, as had been apparently planned, points to a refusal by Clapper to put his name on the document as revised by the White House.

Clapper’s refusal to endorse it – presumably because it was too obviously an exercise in “cherry picking” intelligence to support a decision for war – would explain why the document had to be issued by the White House.

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A clear indication that the White House, rather than Clapper, had the final say on the content of the document is that it includes a statement that a “preliminary U.S. government assessment determined that 1,429 people were killed in the chemical weapons attack, including at least 426 children.”

That figure, for which no source was indicated, was several times larger than the estimates given by British and French intelligence.

The document issued by the White House cites intelligence that is either obviously ambiguous at best or is of doubtful authenticity, or both, as firm evidence that the Syrian government carried out a chemical weapons attack.

It claims that Syrian chemical weapons specialists were preparing for such an attack merely on the basis of signals intelligence indicating the presence of one or more individuals in a particular location. The same intelligence had been regarded prior to Aug. 21 as indicating nothing out of the ordinary, as was reported by CBS news Aug. 23.

The paper also cites a purported intercept by U.S intelligence of conversations between Syrian officials in which a “senior official” supposedly “confirmed” that the government had carried out the chemical weapons attack.

But the evidence appears to indicate that the alleged intercept was actually passed on to the United States by Israeli intelligence. U.S. intelligence officials have long been doubtful about intelligence from Israeli sources that is clearly in line with Israeli interests.

You know, it’s not like Assad isn’t aware we’re spying on him so who are we protecting the “sources and methods” from?  Congress?  The United States people?

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Andrew Sullivan: Kerry Gaffes; The Russians Blink

In his latest stream of unpersuasive self-righteousness, John Kerry today threw out an idea. Instead of threatening an imminent military strike, Kerry actually got creative [..]

Wow. So we have the possibility of two things: that Russia might actually act decisively to rein Assad in, and also support the only viable policy to accomplish what Obama wants – protecting the world from these vile weapons. I have no idea whether this is a serious move by Lavrov – but it sure seems so, and it presents a fascinating non-binary option. It would manage to bring Russia in to solving this problem, without its having to acquiesce to what Putin regards as American grand-standing. And it would surely have some traction at the UN.

Sometimes, it seems, Kerry’s incompetence strikes gold. Here’s hoping.

Josh Levy: Sept. 9 Could Mark the Beginning of the End for Net Neutrality

Sept. 9 is the next front in the long-running battle over what we can do and say online.

That’s the day Verizon will face the Federal Communications Commission in court over the agency’s Net Neutrality protections, which the company wants to overturn. If Verizon gets its way, the FCC’s rules protecting Internet users from corporate abuse will disappear.

Net Neutrality isn’t a new concept: The principle paved the way for the online innovations – including the World Wide Web – we now take for granted. As Sir Tim Berners-Lee put it, “When I invented the Web, I didn’t have to ask anyone’s permission.”

Net Neutrality means that ISPs like AT&T, Comcast and Verizon should be in the business of selling us Internet access, and not in the business of blocking, editing or discriminating against the information we send, the sites we visit or the applications we use. It requires ISPs to keep their hands off the content and focus on providing access to the network.

Inside the End of the U.S. Bid to Punish Lehman Executives

By BEN PROTESS and SUSANNE CRAIG, The New York Times

September 8, 2013, 8:57 pm

The Securities and Exchange Commission’s eight-member Lehman Brothers team, having hit one dead end after another over the previous two years, concluded that suing the bank’s executives would be legally unjustified. The group, noting that prosecutors and F.B.I. agents had already walked away from a parallel criminal case, reached unanimous agreement to close its most prominent investigation stemming from the financial crisis, according to officials who attended the meeting, which has not been reported previously.

But Mary L. Schapiro, the S.E.C. chairwoman, disagreed. She pushed George S. Canellos, who supervised the Lehman investigation as head of the S.E.C.’s New York office, to explain how executives who presided over the biggest bankruptcy in United States history could escape without a single civil charge.

“I don’t get it,” she said during a tense exchange with Mr. Canellos in her private conference room in Washington, according to the officials, who were not authorized to speak publicly. “Why is there no case?” she continued, staring at Mr. Canellos, instructing him to continue investigating whether Lehman misled investors. “The world won’t understand.”

She was right. Five years after Lehman’s collapse hastened a worldwide economic panic, the government faces lingering questions about the decision to spare executives like Richard S. Fuld Jr., who ran Lehman for 14 years until its demise. Not a single senior executive from any Wall Street bank faced criminal charges from the crisis, either. And the government’s deadline for filing most charges will expire this month, the anniversary of Lehman’s collapse, providing a reminder of the case and its unpopular outcome.

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The S.E.C. quietly reached the decision in 2012 after officials sparred for months over whether Lehman omitted “material” information in disclosures to investors, an important legal standard. Mr. Canellos argued that the omissions were not material. And those who questioned that reasoning – like Ms. Schapiro, as well as some accountants and enforcement officials – acquiesced to Mr. Canellos’s team, which was closest to the evidence.

The S.E.C. also debated the culpability of top Lehman executives. But Mr. Canellos’s team argued that Mr. Fuld did not know that Lehman was using questionable accounting practices despite testimony from another Lehman executive that suggested otherwise. Ms. Schapiro did not override his judgment after S.E.C. officials cautioned her that it could be unethical for a political appointee like herself to do so. Mr. Canellos also had the backing of Robert S. Khuzami, who ran the S.E.C.’s enforcement unit at the time.

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The S.E.C.’s decision came in stark contrast to a report by Lehman’s bankruptcy-court examiner, who accused executives of using an accounting gimmick to “manipulate” the balance sheet.

“There were many instances where the S.E.C. had information and didn’t act,” the examiner, Anton R. Valukas, a former federal prosecutor who is now chairman of Jenner & Block, said in an interview.

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In his report on Lehman’s failure, a rebuke that spanned more than 2,200 pages, Mr. Valukas, the bankruptcy-court examiner, outlined accounting maneuvers that he called “balance sheet manipulation.”

The practice allowed Lehman to transfer securities off its balance sheet, presenting them as collateral to an outside lender, which in turn offered Lehman a short-term loan. Lehman treated the transactions as sales rather than as debt, which meant the firm looked as if it had less debt than it actually did. “Unable to find a United States law firm” to approve the maneuver, Mr. Valukas said, Lehman hired a law firm in London to bless it.

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Lehman highlighted the reduction in a public earnings call but never disclosed that it partly stemmed from Repo 105. As such, Mr. Valukas outlined possible civil claims against Mr. Fuld and his chief financial officers, including Erin Callan, who was the C.F.O. during much of the year in which Lehman collapsed. Mr. Fuld, he said, was “at least grossly negligent” for allowing Lehman to make “materially misleading” statements about the firm’s health.

The Valukas report, released in March 2010, appeared to provide a road map for the federal investigation into Lehman executives. But soon after its release, according to the officials involved in the inquiry, prosecutors and the F.B.I. lost interest in the case. They discovered that Repo 105 had nothing to do with Lehman’s failure and was technically allowed under an obscure accounting rule. Noting that London lawyers had approved Repo 105, prosecutors in Manhattan also worried they could not prove that executives intended to mislead investors.

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Mr. Canellos, a former federal prosecutor who is now the co-head of the S.E.C.’s enforcement unit, did not budge. Despite the political pressure, he told colleagues at one of the meetings, they could not bring a case if the evidence was lacking.

“Our job is to seek justice,” he said.

Not with a Bang but a Whimper – the SEC Enforcement Team’s Propaganda Campaign

Bill Black, Naked Capitalism

Monday, September 9, 2013

The New York Times has one of those “inside” stories that unintentionally demonstrate the collapse of justice and financial reporting. This genre involves the media reporting gravely (and uncritically) the administration’s claims that its failure to prosecute any elite for the largest and most destructive financial frauds in history actually demonstrates the exceptional ethical rectitude of the non-prosecutors and non-enforcers. Journalists, unlike alchemists, can transmute dross into gold. In the NYT’s account a pathetic failure of competence, integrity, and courage at the SEC is reimagined as a fantastic triumph of vigor and ethics on the part of the SEC enforcement attorney who refused to seek to hold Lehman’s senior officers accountable for their violations but otherwise became the scourge of elite frauds. In the end, he is promoted for his dedication to “justice” and is now the anti-enforcement leader of the SEC’s enforcement group.

“Justice” became an oxymoron in the Bush and Obama administration. It now means that the elite frauds that became wealthy through their crimes that drove our financial crisis should enjoy de facto immunity from prosecution. The NYT, however, pictures the SEC as an ultra-aggressive enforcer that virtually never fails to take on the elite CEOs leading the control frauds. The entire piece is one extended leak by the SEC’s enforcement leadership which has been severely criticized for its failure to recover the fraudulent profits that elite Wall Street bankers obtained by running the control frauds.

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The pattern of SEC action with regard to elite banks and elite fraudulent bankers demonstrates that they are treated far differently than smaller, non-financial corporations. (Note that this ignores the most important differences – the elite banksters’ frauds are far less likely to be investigated or sued by the SEC and enjoy de facto immunity from prosecution.) The Stanford study does not include cases that the SEC failed to investigate or bring.)

The controlling officers of firms, not the corporation, make decisions. They are happy to trade off penalties that will be paid by the firm. Those penalties sound large but they merely represent the modest cost of doing fraudulent business to ensure that the controlling officers escape individual accountability. The SEC can only achieve deterrence and take the profit out of elite fraud by making the criminal referrals and conducting the investigations that convict senior officers of felonies for their frauds and by recovering all of the officers’ fraudulent proceeds.

The SEC data demonstrate its epic failure in preventing the current crisis (the SEC was useless) and deterring future crises (the SEC leaves the fraudulent wealthy officers immensely wealthy). The SEC has tried to bring enforcement actions against the senior officers of only three of the elite financial institutions (banks). It has sued twelve senior officers of those three banks (or four if we depart from the SEC’s practice and call Fannie and Freddie different cases). It’s biggest “success” left the former CEO of Countrywide with virtually all of the vast wealth that the SEC claims to be the product of fraud. It obtained $80,000 (also almost certainly paid by an insurer) from the CEO of IndyMac, the largest fraudulent seller of fraudulent mortgage loans. That is it for the senior officers of the elite banks whose frauds the SEC says drove the financial crisis.

The SEC, as always, focuses its enforcement on non-elite corporations where it is far easier for its enforcers to rack up higher numbers of “successes.” The “66 senior” individual defendants were overwhelmingly employed by non-elite banks. The SEC’s own data demonstrate that it is a paper tiger when it comes to the elite banksters who grew wealthy by leading the frauds that caused the mortgage fraud crisis.

This is your morning Open Thread. Pour your favorite beverage and review the past and comment on the future.

Find the past “On This Day in History” here.

September 10 is the 253rd day of the year (254th in leap years) in the Gregorian calendar. There are 112 days remaining until the end of the year

On this day in 1776, Nathan Hale volunteers to spy behind British lines

On this day in 1776, General George Washington asks for a volunteer for an extremely dangerous mission: to gather intelligence behind enemy lines before the coming Battle of Harlem Heights. Captain Nathan Hale of the 19th Regiment of the Continental Army stepped forward and subsequently become one of the first known American spies of the Revolutionary War.

the Battle of Long Island, which led to British victory and the capture of New York City, via a flanking move from Staten Island across Long Island, Hale volunteered on September 8, 1776, to go behind enemy lines and report on British troop movements. He was ferried across on September 12. It was an act of spying that was immediately punishable by death, and posed a great risk to Hale.

An account of Nathan Hale’s capture was written by Consider Tiffany, a Connecticut shopkeeper and Loyalist, and obtained by the Library of Congress. In Tiffany’s account, Major Robert Rogers of the Queen’s Rangers saw Hale in a tavern and recognized him despite his disguise. After luring Hale into betraying himself by pretending to be a patriot himself, Rogers and his Rangers apprehended Hale near Flushing Bay, in Queens, New York. Another story was that his Loyalist cousin, Samuel Hale, was the one who revealed his true identity.

British General William Howe had established his headquarters in the Beekman House in a rural part of Manhattan, on a rise between 50th and 51st Streets between First and Second Avenues Hale reportedly was questioned by Howe, and physical evidence was found on him. Rogers provided information about the case. According to tradition, Hale spent the night in a greenhouse at the mansion. He requested a Bible; his request was denied. Sometime later, he requested a clergyman. Again, the request was denied.

According to the standards of the time, spies were hanged as illegal combatants. On the morning of September 22, 1776, Hale was marched along Post Road to the Park of Artillery, which was next to a public house called the Dove Tavern (at modern day 66th Street and Third Avenue), and hanged. He was 21 years old. Bill Richmond, a 13-year-old former slave and Loyalist who later became famous as an African American boxer in Europe, was reportedly one of the hangmen, “his responsibility being that of fastening the rope to a strong tree branch and securing the knot and noose.”

By all accounts, Hale comported himself eloquently before the hanging. Over the years, there has been some speculation as to whether he specifically uttered the famous line:

I only regret that I have but one life to give for my country.

But may be a revision of:

I am so satisfied with the cause in which I have engaged that my only regret is that I have not more lives than one to offer in its service.

The story of Hale’s famous speech began with John Montresor, a British soldier who witnessed the hanging. Soon after the execution, Montresor spoke with the American officer William Hull about Hale’s death. Later, it was Hull who widely publicized Hale’s use of the phrase. Because Hull was not an eyewitness to Hale’s speech, some historians have questioned the reliability of the account