Category Archives: Industry Jobs Oil Economics

When Sharia/ISIS Goes Capitalist and Trading

Posted on by

Islamic State ‘earning millions by playing the stock market’

Group using cash looted from banks in Mosul to speculate on international currency markets

Telegraph: Isil is making millions of dollars for its war chest by playing foreign currency markets under the noses of bank chiefs, it was revealed today.

The terror group is earning up to $20m (£14.29m) a month by funnelling dollars looted from banks during its takeover of the Iraqi city of Mosul into legitimate currency markets in the Middle East.

It then makes huge returns on currency speculation, which are then wired back via unsuspecting financial authorities in Iraq and Jordan, a parliamentary committee was told on Wednesday.

Islamic State of Iraq and the Levant’s (Isil) extraordinary venture into white collar crime is now a major source of income, along with oil smuggling and extortion from people living in Isil-controlled areas.

Details of the scam emerged during a hearing of a specially-convened Foreign Affairs sub-committee set up to examine Britain’s role in Isil financing.

The hearing was told that Isil finance chiefs would play the international stock markets using cash looted during their 2014 take over of Mosul, in which the group got its hands on an estimated $429m from the city’s central bank.

They also used money “siphoned off” from pension payments that are still being made by the Iraqi government to civil servants living in the city.

The details were revealed to the hearing by John Baron, the sub-committee’s chair, who demanded to know whether the British government – which has pledged to help cut off Isil’s finance networks – was taking proper action against it.

“The cash that Isil has looted, along with siphoned off pension payments, is routed into Jordanian banks and brought back into the system via Baghdad,” he said. “That allows the system to be exploited by Isil, in that they take a turn (profit) on the foreign currency actions and siphon that cash back.”

The profits were channeled back into Isil coffers by “hawala” transfers, an unregulated system of money transfer whereby cash payments are made via agents in one country after a similar amount is presented as collateral in another.

Infographic: How Does ISIS Fund Itself? | Statista

Tobias Ellwood, a junior Foreign Office minister, admitted to the committee that there was a “porousness” in the local financial system but said that work was now underway to shut it down. It had been done without the active connivance of bank staff, he added.

In December, the Central Bank of Iraq named 142 currency-exchange houses in Iraq that the US suspected of moving funds for Islamic State. It banned them from its twice-monthly dollar auctions in a bid to stop the terror group getting its hands on the cash – a main source of exchange in war-torn Iraq.

But Mr Ellwood conceded: “Iraq could have moved faster on this”. Asked if the similar moves had been made in Jordan, he said he was unable to give an answer.

“Jordan plays an important role in the (anti-Isis) coalition,” he added. “Work is being done to close it down, I don’t think there is anything near as much from that source of revenue as before.”

The committee heard claims that Isil’s “rake off” from foreign currency speculation was a “significant part of their income stream”, although Mr Ellwood said he thought that estimates of $20m were excessive.

**** 

Spiegel: Some members of the intelligence community even view spying in the global financial system with a certain amount of concern, as revealed by a document from the NSA’s British counterpart — the Government Communications Headquarters (GCHQ) — that deals with “financial data” from a legal perspective and examines the organization’s own collaboration with the NSA. According to the document, the collection, storage and sharing of “politically sensitive” data is a highly invasive measure since it includes “bulk data — rich personal information. A lot of it is not about our targets.”

Indeed, secret documents reveal that the main NSA financial database Tracfin, which collects the “Follow the Money” surveillance results on bank transfers, credit card transactions and money transfers, already had 180 million datasets by 2011. The corresponding figure in 2008 was merely 20 million. According to these documents, most Tracfin data is stored for five years.

Monitoring SWIFT

The classified documents show that the intelligence agency has several means of accessing the internal data traffic of the Society for Worldwide Interbank Financial Telecommunication (SWIFT), a cooperative used by more than 8,000 banks worldwide for their international transactions. The NSA specifically targets other institutes on an individual basis. Furthermore, the agency apparently has in-depth knowledge of the internal processes of credit card companies like Visa and MasterCard. What’s more, even new, alternative currencies, as well as presumably anonymous means of payment like the Internet currency Bitcoin, rank among the targets of the American spies.

The collected information often provides a complete picture of individuals, including their movements, contacts and communication behavior. The success stories mentioned by the intelligence agency include operations that resulted in banks in the Arab world being placed on the US Treasury’s blacklist.

In one case, the NSA provided proof that a bank was involved in illegal arms trading — in another case, a financial institution was providing support to an authoritarian African regime. Full article here.

Freed Dealer, Obama Released, Kills 3

Posted on by

Crack Dealer Freed Early Under Obama Plan Murders Woman, 2 Kids

JW: A convicted crack dealer who left prison early as part of the Obama administration’s mass release of federal inmates has been indicted by a grand jury for fatally stabbing his ex-girlfriend and her two kids in Columbus, Ohio. The gory crime drew national attention because the children, ages 7 and 10, were murdered to eliminate them as witnesses in the brutal massacre of their 32-year-old mother.

This week a grand jury in Franklin County returned a 10-count, death-penalty indictment against the ex-con, 35-year-old Wendell Callahan, for the triple murders. Callahan broke into his ex-girlfriend’s apartment and stabbed the three victims, according to a statement issued by Franklin County Prosecutor Ron O’Brien announcing the indictment. The bloody crime scene was discovered by the woman’s current boyfriend, who subsequently engaged in a fight with Callahan before he fled. The indictment includes charges of aggravated murder with prior calculation and design and aggravated murder of victims under the age of 13. “There are multiple charges regarding the three victim deaths because there are different methods to commit the crime of murder and the Prosecutor’s Office typically charges all methods”, O’Brien stated. Callahan is in jail on $3 million bail and is scheduled to be arraigned later this week.

Callahan should have been in jail when the crimes occurred, but he was released four years early because federal sentencing guidelines for crack dealers got reduced. The change is part of President Obama’s effort to reform the nation’s justice system as a way of ending racial discrimination. The initiative was technically launched back in 2010 when the president signed a measure that for the first time in decades relaxed drug-crime sentences he claimed discriminated against poor and minority offenders. This severely weakened a decades-old law enacted during the infamous crack cocaine epidemic that ravaged urban communities nationwide in the 1980s. As part of the movement the U.S. Sentencing Commission lowered maximum sentences for drug offenders and made it retroactive, leading to the early release of thousands of violent thugs like Callahan.

In November the administration began releasing 6,000 drug convicts coined “non-violent” offenders whose sentences were too long under the old guidelines. News reports quickly surfaced contradicting the administration’s assessment that the newly released convicts were not violent. Among them was the leader of a multi-million dollar operation that smuggled drugs from Canada to Maine. Prosecutors refer to the 29-year-old con as a “drug kingpin” who was one of “America’s Most Wanted.” Shortly before the administration’s mass release of drug convicts, federal prosecutors warned that drug trafficking is inherently violent and therefore the phrase “non-violent drug offenders” is a misnomer. The nation’s prosecutors also cautioned that reducing prison sentences for drug offenders will weaken their ability to bring dangerous drug traffickers to justice.

As if it weren’t bad enough that the administration is rewarding thousands of criminals with get-out-of-jail cards, huge amounts of taxpayer dollars are being spent on programs to help them find housing and jobs. In the aftermath of the mass release of federal prisoners Judicial Watch reported on two “re-entry” programs to ease the transition from jail. One received $1.7 million and ordered public housing facilities not to reject tenants with criminal records. The other allocated $20 million to the Department of Labor (DOL) to help ex-cons find work and thus end the “cycle of poverty, criminality and incarceration.”

More here including photos.

Hillary calls for sentencing reform too.

This all began in 2013 between Obama and Eric Holder and Loretta Lynch continues to carry the baton.

VOA: WASHINGTON— U.S. Attorney General Eric Holder has announced a major shift in how the federal government plans to prosecute nonviolent criminals involved in drug crimes, with the aim of easing overcrowding in the nation’s prisons.

Holder outlined several policy changes in a speech to the American Bar Association meeting in San Francisco.

The attorney general said too many Americans go to prison for far too long and for no truly good law enforcement reason.  His main focus was low-level drug crimes that can often bring minimum mandatory sentences of five or 10 years in prison.

Holder says the federal government will now follow the lead of several states that emphasize drug treatment and community service programs as alternatives for non-violent drug offenders who are not associated with criminal gangs or drug cartels.

“Widespread incarceration at the federal, state and local levels is both ineffective and unsustainable,” he said. “It imposes a significant economic burden totalling $80 billion in 2010 alone and it comes with human and moral costs that are impossible to calculate.”

Hey Pentagon, Hiring Hackers, a Good Idea?

Posted on by

Personally I do see some positives, but I see more downsides….what say you?

The Department of Defense announced today that it will invite vetted hackers to test the department’s cybersecurity under a unique pilot program.  The “Hack the Pentagon” initiative is the first cyber bug bounty program in the history of the federal government.

 

Under the pilot program, the department will use commercial sector crowdsourcing to allow qualified participants to conduct vulnerability identification and analysis on the department’s public webpages.  The bug bounty program is modeled after similar competitions conducted by some of the nation’s biggest companies to improve the security and delivery of networks, products, and digital services. The pilot marks the first in a series of programs designed to test and find vulnerabilities in the department’s applications, websites, and networks.

 

Participants in the bug bounty will be required to register and submit to a background check prior to any involvement with the pilot program.  Once vetted, these hackers will participate in a controlled, limited duration program that will allow them to identify vulnerabilities on a predetermined department system.  Other networks, including the department’s critical, mission-facing systems will not be part of the bug bounty pilot program.  Participants in the competition could be eligible for monetary awards and other recognition.

This innovative project is a demonstration of Secretary Carter’s continued commitment to drive the Pentagon to identify new ways to improve the department’s security measures as our interests in cyberspace evolve.

Pentagon to Establish Defense Innovation Advisory Board

WASHINGTON, March 2, 2016 — In an effort to enhance the Defense Department’s culture, organization and processes by tapping innovators from the private sector in Silicon Valley and beyond, Defense Secretary Ash Carter announced plans today to establish a Defense Innovation Advisory Board, Pentagon Press Secretary Peter Cook said.

 Google, CEO

The initiative represents the secretary’s enduring commitment to building lasting partnerships between the public and private sectors, Cook said in a statement.

“Just as the Defense Business Board provides advice to the department on best business practices from the private sector, the Defense Innovation Advisory Board will provide advice on the best and latest practices in innovation that the department can emulate,” Cook added.

The board’s mandate is to provide department leaders independent advice on innovative and adaptive means to address future organizational and cultural challenges, the press secretary said, including the use of technology alternatives, streamlined project management processes and approaches — all with the goal of identifying quick solutions to DoD problems.

Areas Deeply Familiar in Silicon Valley

The board will seek to advise the department on areas that are deeply familiar to Silicon Valley companies, such as rapid prototyping, iterative product development, complex data analysis in business decision making, the use of mobile and cloud applications, and organizational information sharing, Cook said, and will not engage in discussion of military operations or strategy.

Alphabet Executive Chairman Eric Schmidt will chair the board, which will be composed of up to 12 people who have successfully led large private and public organizations and excelled at identifying and adopting new technology concepts, Cook said.

Carter and Schmidt will jointly select the board, Cook said. “Members will represent a cross-section of America’s most innovative industries, drawing on technical and management expertise from Silicon Valley and beyond,” he added.

As chairman of Alphabet and as the author of “How Google Works,” Schmidt has a unique perspective on the latest practices in harnessing and encouraging innovation and in the importance of technology in driving organizational behavior and business operations, Cook said.

**** Background

US spy chief James Clapper highlights cyber threats

BBC: US intelligence agencies have placed cyber attacks from foreign governments and criminals at the top of their list of threats to the country.

Online assaults would increasingly undermine US economic competitiveness and national security, said Director of National Intelligence James Clapper.

A report issued by his office said Russia’s military was setting up a cyber command to carry out attacks.

The report also describes China, Iran and North Korea as leading threats.

In testimony to a congressional committee on Thursday, Mr Clapper said he no longer believed the US faced “cyber Armageddon”.

The idea that major infrastructure such as financial networks or power grids could be disabled by hackers now looked less probable, he said.

However he warned: “We foresee an ongoing series of low-to-moderate level cyber attacks from a variety of sources over time, which will impose cumulative costs on US economic competitiveness and national security.”

Mr Clapper highlighted the case of Russia, which he said posed the greatest a cyber risk to US interests. He said that threat from the Russian government was “more severe” than previously realised.

He also said profit-minded criminals and ideologically driven hackers were also increasingly active.

Over the past year there have been a series of high-profile cyber attacks against US targets.

North Korea was accused of being behind the theft of a huge data cache from Sony Pictures in November.

Mr Clapper also mentioned the example of an alleged Iranian attack on the Las Vegas Sands Casino Corporation last year.

Meanwhile in January the Twitter and YouTube accounts of the US military command were hacked by a group claiming to back Islamic State (IS).

During the hearing, Mr Clapper acknowledged that the US had its own “offensive capabilities”.

In 2010 Iran experienced a cyber attack on its nuclear program. Tehran accused Israel and the US of planting malware.

China to lay off five to six million workers

Posted on by

Hank Paulson: China needs to let ‘failing companies fail’

Former U.S. Treasury Secretary Henry Paulson, who oversaw bank bailouts during the global financial crisis, has different advice for China: Let companies fail.

“They can show right now they’re very serious about dealing with inefficient state-owned enterprises as they take capacity out of the steel industry, coal industry and others by letting some failing companies fail,” Paulson, who was Treasury secretary from 2006-2009, told CNBC’s Squawk Box on the sidelines of an Institute of International Finance event organized in conjunction with the G20 meeting in Shanghai.

As Treasury secretary, Paulson oversaw a $700 billion government-funded bailout of U.S. financial institutions that were seen as “too big to fail” in the global financial crisis.

Paulson, who is also a former chairman and CEO of Goldman Sachs, added that China needed to move faster to promote competition.

“Competition is about opening up to the private sector, which is the future, and it’s about putting the state-owned enterprises on a level playing field,” said Paulson,, who earlier this decade founded the independent think tank Paulson Institute promoting sustainable and environmental projects. “There’s clearly room to move faster.”

Last year, China issued guidance on reforming often-inefficient state enterprises, such as introducing mixed public-private ownership as well as pushing for mergers and share sales, but the market isn’t always certain of progress on this front.

Exclusive: China to lay off five to six million workers, earmarks at least $23 billion

Reuters: China aims to lay off 5-6 million state workers over the next two to three years as part of efforts to curb industrial overcapacity and pollution, two reliable sources said, Beijing’s boldest retrenchment program in almost two decades.

China’s leadership, obsessed with maintaining stability and making sure redundancies do not lead to unrest, will spend nearly 150 billion yuan ($23 billion) to cover layoffs in just the coal and steel sectors in the next 2-3 years.

The overall figure is likely to rise as closures spread to other industries and even more funding will be required to handle the debt left behind by “zombie” state firms.

The term refers to companies that have shut down some of their operations but keep staff on their rolls since local governments are worried about the social and economic impact of bankruptcies and unemployment.

Shutting down “zombie firms” has been identified as one of the government’s priorities this year, with China’s Premier Li Keqiang promising in December that they would soon “go under the knife”..

The government plans to lay off five million workers in industries suffering from a supply glut, one source with ties to the leadership said.

A second source with leadership ties put the number of layoffs at six million. Both sources requested anonymity because they were not authorized to speak to media about the politically sensitive subject for fear of sparking social unrest.

The ministry of industry did not immediately respond when asked for comment on the reports.

The hugely inefficient state sector employed around 37 million people in 2013 and accounts for about 40 percent of the country’s industrial output and nearly half of its bank lending.

It is China’s most significant nationwide retrenchment since the restructuring of state-owned enterprises from 1998 to 2003 led to around 28 million redundancies and cost the central government about 73.1 billion yuan ($11.2 billion) in resettlement funds.

On Monday, Yin Weimin, the minister for human resources and social security, said China expects to lay off 1.8 million workers in the coal and steel industries, but he did not give a timeframe.

China aims to cut capacity gluts in as many as seven sectors, including cement, glassmaking and shipbuilding, but the oversupplied solar power industry is likely to be spared any large-scale restructuring because it still has growth potential, the first source said.

DEBT OVERHANG

The government has already drawn up plans to cut as much as 150 million tonnes of crude steel capacity and 500 million tonnes of surplus coal production in the next three to five years.

It has earmarked 100 billion yuan in central government funds to deal directly with the layoffs from steel and coal over the next two years, vice-industry minister Feng Fei said last week.

The Ministry of Finance said in January it would also collect 46 billion yuan from surcharges on coal-fired power over the coming three years in order to resettle workers. In addition, an assortment of local government matching funds will also be made available.

However, the funds currently being offered will do little to resolve the problems of debts held by zombie firms, which could overwhelm local banks if they are not handled correctly.

“They have proposed this dedicated fund only to pay the workers, but there is no money for the bad debts, and if the bad debts are too big the banks will have problems and there will be panic,” said Xu Zhongbo, head of Beijing Metal Consulting, who advises Chinese steel mills.

Factories shut down would have to repay bank loans to avoid saddling state banks with a mountain of non-performing loans, the sources said. “Triangular debt”, or money owed by firms to other enterprises, would also have to be resolved, they added.

Although China has promised to help local banks transfer the bad debts of zombie steel mills to asset management firms, local governments are not expected to gain access to the worker lay-off funds until the zombie firms have actually been shut down and debt issues settled.

($1 = 6.5476 Chinese yuan)

Wall Street to Clinton Foundation: $40 Million

Posted on by

For what exactly? A question likely to never fully be answered…Unless we get the rest of ‘those’ emails.

Clinton Foundation Discloses $40 Million in Wall Street Donations

Hillary Clinton is facing more questions about her close ties to Wall Street financial institutions. Last week, the New York Times urged Clinton to release transcripts of her highly-compensated speeches to Wall Street firm Goldman Sachs.

Breitbart: The paid speeches are just a slim chapter of her relationship with financial titans. According to Clinton Foundation records, Wall Street financial institutions have donated around $40 million to the eponymous family foundation.

As a non-profit, the Clinton Foundation isn’t legally required to disclose its donors or contributions. The Foundation has publicly disclosed some contributions on its website. It only provides ranges for contributions, e.g. $1-5 million, and doesn’t detail when the contribution was made or for what purpose, if any.

Here’s the chart of contributions from Wall Street to the Clinton Foundation.

Four major Wall Street institutions stand out; Barclays, Barclays Capitol, Goldman Sachs and Citi. Each are listed as given between $1 million and $5 million to the Foundation. Citigroup, UBS, Banc of California and Bank of America are listed as giving up to $1 million to the Foundation.

All together, contributions from readily identifiable Wall Street institutions to the Foundation total somewhere between $11 million and $41 million in contributions. If we assume the donations fall in the middle of the ranges disclosed by the Clinton Foundation, the contributions would total just under $30 million.

As with most things involving the Clintons, the devil is in the details. This total of contributions does not include those made by individuals with strong Wall Street ties. It also does not necessarily represent the total amounts contributed to the Foundation from those donors listed. It only accounts for the donations which the Foundation has chosen to disclose.

The failure of the Foundation to include any information on the timing of the donations is especially worrisome. In terms of donor relationships, there is a real difference between a one-time gift of $1 million and an ongoing gift of $200,000 for 5 straight years. The total dollar amount may be the same, but an ongoing gift usually requires a more substantive relationship between the Foundation and the donor.

There is, of course, an added dimension to the timing issue with the Clintons. During the life of the Foundation, Hillary Clinton has been a US Senator, Secretary of State and two-time candidate for President.

When the Clinton Foundation discloses that the “Friends of Saudi Arabia” contributed $1-5 million, it begs the obvious question of when that donation was made. The specific date of that donation is particularly important, given Clinton’s considerable focus on the Middle East while she was Secretary of State.

It is also important to note that these contributions are completely seperate from the paid speeches made by Bill and Hillary Clinton. In 2013 alone, Hillary earned just over $3 million in paid speeches to financial firms and institutions.

These contributions, obviously, also don’t include direct contributions made by Wall Street institutions and individuals to either of Clinton’s Presidential campaigns.

In a recent Democrat debate, Clinton’s sole challenger, Sen. Bernie Sanders (I-VT) challenged her, “Can you really reform Wall Street when they are spending millions and millions of dollars on campaign contributions…And when they are providing speaking fees to individuals?”

He should have added that Wall Street has showered Clinton’s family foundation with millions in contributions.

Wall Street, and the financial industry generally, is not simply a special interest contributing to Clinton’s political ambitions. It is woven into the very fabric of the Clinton’s lives. It fuels her politial ambitions, provides employment to Bill and Hillary through generous speaking fees, and it underwrites a significant amount of the work undertaken by the family’s Clinton Foundation.

If the Clintons were any closer to Wall Street and financial firms, they would probably have to file SEC disclosures. They could very well be the first American family with their own Dodd-Frank regulation.