Banks Post Profit of $21.6 Billion in 2nd Quarter

   (Financial News USA) - 8/31/2010 - A mixed picture of U.S. banks emerged Tuesday as the industry posted its highest quarterly earnings in nearly three years while the number of troubled institutions grew by more than 50.
   Banks overall made $21.6 billion in net income in the April-to-June quarter, the Federal Deposit Insurance Corp. said. It was the highest quarterly level since 2007 and was led by the largest institutions. 
   The industry lost $4.4 billion in the second quarter of 2009.
But the number of banks on the FDIC's confidential "problem" list increased by 54 in the quarter -- growing to 829 from 775 in the first quarter. Most of the banks that have failed this year have been smaller or regional banks.
   The decline in bank lending stemming from the financial crisis showed signs of leveling off, the data show. Total lending declined by $107.5 billion, or 1.4 percent from the first quarter. It posted the steepest drop since World War II -- 7.5 percent -- in 2009 from the year before.
FDIC Chairman Sheila Bair said banks' lending standards are beginning to ease for some types of credit.
   "But lending will not pick up until businesses and consumers gain the confidence they need to hire and spend," Bair said.
   She said the economic recovery is starting to be reflected in banks' higher earnings and the improved quality of loans, with fewer defaults and delinquencies.
   For the first time since late 2006, banks overall set aside less to cover future losses on loans than they had a year earlier, the FDIC said. Total reserves declined by $11.8 billion, or 4.5 percent.
  The biggest banks have mounted a strong recovery with help from federal bailout money and record-low borrowing rates from the Federal Reserve. They also have been able to cut back on lending in troubled parts of the country such as Florida and Nevada.
Smaller and regional banks, however, have less flexibility. They have accounted for nearly all the banks that have failed this year.
  The FDIC's deposit insurance fund, which fell into the red about a year ago, posted a slight improvement. Its deficit declined to $20.7 billion from $20.9 billion.
   The FDIC expects U.S. bank failures to cost the insurance fund around $100 billion through 2013. The agency mandated last year that banks prepay about $45 billion in premiums, for 2010 through 2012, to help replenish the fund.
   Last year, 140 federally insured institutions failed and were shut down by regulators. It was the highest annual number since 1992, when the savings and loan crisis hit its peak. Last year's failures extended a string of collapses that began in 2008, triggered by loan defaults in the financial crisis.
   The pace of bank collapses this year exceeds last year's. So far, 118 banks have failed in 2010. The pace has quickened as banks' losses mount on loans made for commercial property and development. Many companies have shut down in the recession, vacating shopping malls and office buildings financed by the loans. That has brought delinquent loan payments and defaults by commercial developers.

Alfred Kahn Testifies on FERC's 'Parity' Proposal

   NEW YORK - (BUSINESS WIRE) - 8/31/2010 - In an affidavit filed Monday with the Federal Energy Regulatory Commission (FERC) on demand response compensation in organized wholesale markets, the “father of regulatory economics” Dr. Alfred E. Kahn testified in support of FERC’s Notice of Proposed Rulemaking (NOPR) to require that organized wholesale markets compensate demand response in the same manner as generation.
   In his testimony, Kahn emphasizes that “demand response is in all essential respects economically equivalent to supply response,” and that “economic efficiency requires, as the NOPR recognizes, that it should be rewarded with the same Locational Marginal Price (LMP) that clears the market.”
   Kahn further advocates that “any increase in the efficient responsiveness of demand (to prices competitively determined, as in the ISO-conducted auctions) will move us in the direction of correcting the most severe deficiency in most such markets in the US, the lack of an adequately, price-responsive demand side.”
   Kahn’s testimony comes on the heels of comments filed by opponents to demand response parity, including the Electric Power Supply Association, which, according to Dr. Kahn, mischaracterized full LMP compensation for demand response as a “subsidy” rather than a legitimate investment.
   “That electricity generators have opposed this plan should not be surprising: their primary business is to sell power, not to encourage its conservation, and I have myself publicly cited evidence that they reap the preponderance of their profits on those occasions when demand is at its peak,” Kahn said in his comments.
   Kahn is a world-renowned economist and the Robert Julius Thorne Professor of Political Economy, Emeritus, at Cornell University. He served as an economic advisor to President Carter, the Chairman of the New York Public Service Commission, and the Chairman of the Council on Wage and Price Stability. Dr. Kahn is the author of many publications including "The Economics of Regulation," the first comprehensive integration of the economic theory and institutional practice of economic regulation.
   “Having Dr. Kahn, one of our country’s most respected economists, advocate so articulately for full LMP compensation for demand response as set forth in the FERC NOPR is a significant win for ratepayers, for the demand response industry, and for the businesses and organizations that provide this valuable service to the grid,” EnerNOC President David Brewster said.
  Viridity Energy President and CEO Audrey Zibelman added, “I am pleased to see such a strong statement from Professor Kahn highlighting the impact of demand response in bringing greater levels of competition to the organized electricity markets and in improving the operation of the markets for consumers."

Reference

EPA to Establish Environmental Justice Guidelines

By Steve Rensberry
srensberry@charter.net
 
   (RPC) - 8/27/2010 - The concept of environmental justice isn't one you hear about very often. Although it's been discussed for years, it's a sure bet that many people have never even heard of it. Others simply might not care, or may label it a political issue.
   But the concept has been gaining steam as some of the more obvious disparities in environmental regulation, planning and policies have surfaced, policies with a direct impact on poor and minority populations who very often have neither the power nor means to do anything about it.
   There's a quarterly journal by the same name at: Environmental Justice, published by Mary Ann Liebert, Inc. There's an Environmental Justice Resource Center at Clark Atlanta University (EJRC), an Environmental Justice Foundation (EJF)  and an environmental justice focus among a number of government agencies, particularly the U.S. Department of Transportation and now perhaps the U.S. Environmental Protection Agency.
   As the EPA defines it: "Environmental Justice is the fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws, regulations, and policies."
   This past month the EPA announced that it was releasing an "interim guidance document" to assist its staff in incorporating environmental justice concerns into its rule making process, calling it a positive step in protecting communities who are disproportionately impacted by pollution.
   "Historically, the low-income and minority communities that carry the greatest environmental burdens haven't had a voice in our policy development or rule making. We want to expand the conversation to the places where EPA's work can make a real difference for health and the economy," EPA Administrator Lisa P. Jackson said. "This plan is part of my ongoing commitment to give all communities a seat at the decision-making table. Making environmental justice a consideration in our rule making changes both the perception and practice of how we work with overburdened communities, and opens this conversation up to new voices."
   The document is entitled "Guidance on Considering Environmental Justice During the Development of Action," and focuses specifically on low-income, indigenous and minority communities and tribal government who, it says, have been under-represented in the regulatory decision-making process.
   "The guidance also outlines the multiple steps that every EPA program office can take to incorporate the needs of overburdened neighborhoods into the agency's decision-making, scientific analysis, and rule development. EPA staff is encouraged to become familiar with environmental justice concepts and the many ways they should inform agency decision-making," the notice says.
   Public input is being sought on how to best implement and improve the guide. See: EPA Source.
The page contains a PDF link to a 55-page document explaining the guide and the agency's overall purpose.
   An example of issues the document looks at is seen on page 29 in a serious of questions to be considered with whatever action is being taken.
   "Does the action involve a topic that is likely to be of interest to or have particular impact upon minority, low income, or indigenous populations, or tribes?" it asks. "If you answer yes, please check a minimum of one of the following,"
  • The action is likely to impact the health of these populations.
  • The action is likely to impact the environmental conditions of these populations.
  • The action is likely to present an opportunity to address an existing disproportionate impact on these populations.
  • The action is likely to result in the collection of information or data that could be used to assess potential impacts on the health or environmental conditions of these populations or tribes.
  • The action is likely to affect the availability of information to these populations or tribes.
   If you're curious about where you community is rated on the pollution scale, a Pollution Information Site called Scorecard at www.scorecard.org/ may be of interest. Author Douglas Dunn has also written an article about the broader issue of economic rather than just environmental justice, with some degree of balance. See: Economic Justice and Fairness

Refinancing Your Home in a Depressed Market

   (NewsUSA) - 8/25/2010 - Falling home values are a cause for concern for millions of American homeowners, mortgage lenders and the federal government.
    To help families dealing with lower home values and other personal crises, the Obama Administration announced the Making Home Affordable initiative that is designed to help between 7 million and 9 million Americans improve the affordability of their mortgage and prevent foreclosure.
   There are several programs under the Making Home Affordable initiative. One of these is the Home Affordable Refinance Program (HARP). HARP is a refinance program for homeowners who are current on their mortgage payments, but unable to take advantage of the current low interest rates due to their home's depressed value. The program is also designed to assist borrowers in changing from a risky loan, like a negatively amortizing adjustable, into a more stable 30-year fixed rate.     There are several eligibility requirements for the HARP program, however the most important one is that your loan be owned or guaranteed by either Fannie Mae or Freddie Mac, and you must work directly through your lender (the company that currently services your loan).
    Borrowers interested in knowing if they qualify for a HARP refinance program must contact their lender. You can also obtain general information about HARP, as well as access links to determine whether your loan is Fannie Mae- or Freddie Mac-owned or guaranteed, from the Making Home Affordable web site: http://www.makinghomeaffordable.gov/loan_lookup.html.
    Before your lender can make you an offer, you will need to fully document your income, which generally requires providing: your W-2s, recent bank statements and pay stubs. The PMI Mortgage Insurance Co. has a helpful mortgage-assessment form at www.homesafepmi.com, where you can input the information your lender will likely require.
   Given the backlog of requests, the process from phone call to decision may take 60 to 90 days.
   Source: NewsUSA

Region Sees 112 Homicides in 2010 as of Aug. 12

By Steve Rensberry
srensberry@charter.net

   (RPC) - ST. LOUIS - 8/23/2010 - Two shootings, one in Washington Park, Illinois, and one on Louisiana Avenue in St. Louis are the latest to be listed on an interactive listing of murders in the St. Louis area this year, compiled by Erica Smith and Greg Jonsson of the St. Louis Post-Dispatch and available online here: 2010 St. Louis area murder map. The project was started on Jan. 1 of this year and also contains a link (though inactive at last attempt) to the 2009 map.
    According to the site, both homicides took place on Aug. 12. In the one in Washington Park, 25-year-old Jonathon T. Jones was found dead in his home after police had responded to a report of gunshots in the area. Two other men still in the house were injured but survived. A third man was uninjured.
    "Police believe someone walked into the home and started shooting, but aren't sure who or why," the report says.
    The shooting on Louisana Avenue involved a 44-year-old man named Kenneth Roberts who was shot in the face during an argument near where he lived. Witnesses reported a green vehicle from which the fatal shots were fired.
    In both cases, anyone with information is asked to call 618-346-3768 or CrimeStoppers at 866-371-8477.
    The shootings bring to 112 the number of killings in the St. Louis region this year that are listed on the website, with June being by far the deadliest at 22. Listed are 14 in January, 5 in February, 14 in March, 19 in April, 12 in May, 22 in June, 13 in July and 3 so far in August. While not all homicides remain unsolved, the person or persons who thought up this great interactive tool deserve praise.
    "Our goal is to map each area murder and follow up with information on arrests, charges and sentences. This map will be continuously updated; check back for more information. Many of these cases are still under investigation," Smith and Jonsson write.

Three Sentenced in Multi-Million Dollar Scheme

   CHARLESTON, W. Va. – 8/21/2010 – Three individuals were sentenced on Aug. 19 for their roles in a multi-million dollar, international fraud and money laundering scheme targeting vendors of state governments, including West Virginia, announced U.S. Attorney R. Booth Goodwin II. Robert M. Otiso, 36, of Elk River, Minn., was sentenced to 72 months in prison for conspiracy to commit mail and wire fraud; Paramena J. Shikanda, 35, of Minneapolis, was sentenced to 46 months in prison for conspiracy to commit money laundering; and Collins K. Masese, 21, of St. Paul, Minn., was sentenced to nine months in prison for conspiracy to commit money laundering.  
   “Today represents a victory for taxpayers,” Goodwin said. “When the state itself is defrauded, we all suffer. Money taken from the public treasury is money not available for schools, roads, and police and fire departments. That is why this case was such a priority for my office.”
    “I am very proud of the swift response and thorough investigation conducted by the federal and state investigators, and the aggressive prosecution of Susan M. Robinson, Chief of the White Collar Crime Section in my office,” U.S. Attorney Goodwin said. “Their work, no doubt, prevented additional significant losses to the victims.”
   The convictions stem from a joint federal investigation following the diversion of millions of dollars from the state of West Virginia. Specifically, the defendants, all Kenyan nationals, devised a scheme in late 2008 in Kenya, which resulted in the diversion of $3.379 million from West Virginia, Kansas and Ohio, as well as the Commonwealth of Massachusetts to bank accounts controlled by the co-conspirators. The funds were intended for legitimate vendors as payment for goods and services. The investigation revealed that in excess of $770,000 was wired to bank accounts in Kenya.
   The scheme targeted vendors who received significant payments from the states on a routine basis. In order to execute their scheme, co-conspirators located in the United States filed documents creating dummy entities with names similar to the legitimate vendors.
   Fraudulent bank accounts were then created in the names of the targeted vendors. With information acquired through the Internet and otherwise, direct deposit authorization forms were completed for the targeted vendors, including Deloitte Consulting LLP, Unisys Corporation, Accenture LLP and Electronic Data Systems Inc. Authorization forms were then mailed to the states along with voided starter checks on the fraudulent accounts. The direct deposit authorization forms purported to authorize the states to send electronic payments for goods and services to the targeted vendors.
   The fraudulently submitted forms were intended to and did cause several states to route payments to the fraudulent bank accounts established by the co-conspirators, thereby allowing the defendants to hijack legitimate vendor payments.
   In April and May 2010, two other Kenyan nationals entered guilty pleas to charges stemming from their roles in the fraud scheme. Michael M. Ochenge, 33, and Albert E. Gunga, 30, both of Minneapolis, pleaded guilty to conspiracy to commit money laundering. They are scheduled to be sentenced on Aug. 26.
   U.S. District Judge John T. Copenhaver, Jr. presided over the proceedings.
   Source: Financial Fraud Enforcement Task Force

Is Collapse Near for Second 'London Gold Pool'?

   MANCHESTER, Conn. - (BUSINESS WIRE) - 8/19/2010 - Manipulative selling of gold on the daily London PM fix has failed to suppress the gold price since April 2009, when China announced that it quietly had accumulated a large gold reserve over the previous five years, the Gold Anti-Trust Action Committee (GATA) disclosed recently in a statistical study by its board member, Adrian Douglas.
   Since April 2009, Douglas finds, ever-increasing dumping of gold in London by central banks and their bullion bank agents has been having less and less effect on the gold price. He concludes that the second "London Gold Pool" -- a clandestine one, unlike the first -- is imminently facing a collapse identical to the collapse of the first as physical gold demand overwhelms the ability or the desire of the market riggers to provide the necessary metal.
   The result of the 1968 failure of the first London Gold Pool to suppress gold was an appreciation of the gold price from $35 to $850 per ounce. A similar percentage today would carry gold to almost $30,000 per ounce. Douglas says, “This is not a price forecast but an indication that when free market forces have been frustrated by market manipulation for a very long time, the equilibrium price can be many multiples of the suppressed price, and the rise is typically rapid when the suppression is overcome.”
   Douglas' study is titled "The Failure of the Second London Gold Pool."   GATA is a non-profit educational and civil rights organization founded in 1999 that exposes and supports litigation against manipulation of the gold market and related markets. GATA is suing the Federal Reserve in U.S. District Court for the District of Columbia for access to gold-related records the Fed refuses to disclose.

Solvency of Medicare Trust Fund Extended 12 Yrs

   WASHINGTON - (BUSINESS WIRE) - 8/11/2010 - U.S. Department of Health and Human Services Secretary Kathleen Sebelius joined Secretary of Treasury and Managing Trustee Tim Geithner, Secretary of Labor and Trustee Hilda Solis, and Commissioner of Social Security and Trustee Michael J. Astrue to release the 2010 Annual Social Security and Medicare Trustees Report.
   The Trustees announced that the solvency of the Medicare Hospital Trust Fund will be extended by 12 years until 2029.  
   "It is clear that the Affordable Care Act is helping to strengthen the solvency of the Medicare Trust fund and preserve this important program that millions of Americans rely on for their health care," Sebelius said. "We are committed to delivering the kinds of reforms to help increase quality and lower costs through our new CMS Innovation Center and quality reforms. In addition to the provisions of the new law cited in this report that will help make Medicare stronger, there are other important reforms going into effect that will help bring down costs and reduce fraud and waste in the system.”
    In addition to Secretary Sebelius' remarks at the Trustees press conference which can be found below, the Centers for Medicare and Medicaid Services (CMS) posted a statement on today's Trustee Report from CMS Administrator Don Berwick on Medicare's home page: http://www.medicare.gov under “What’s New.”
    CMS also posted a fact sheet on the Medicare Trustees Report and can be found here: http://www.cms.gov/apps/media/press/factsheet.asp?Counter=3823.
   Earlier this month HHS and CMS released a report about savings that have released to date thanks to the Affordable Care Act, which can be found here: http://www.cms.gov/apps/docs/ACA-Update-Implementing-Medicare-Costs-Savings.pdf.

Recession Adds $2.2 Billion to Illinois’ Debt

   (Illinois Statehouse News) - By Mary Massingale - 8/8/2010 - As Illinois faces a $13 billion budget deficit, a separate $2.2 billion debt has quietly accumulated during the recession – and because of the recession.
    Illinois started borrowing from the Federal Unemployment Account last summer to bolster the state’s dwindling unemployment trust fund. The federal account serves as a line of credit for states across the nation so that unemployment benefits can continue to be paid to eligible out-of-work residents.
    “It is continuously something that we monitor on a daily basis,” said Greg Rivara, spokesman for the Illinois Department of Employment Security.
   Rivara said borrowing from the federal account is simply a necessary evil during a lingering recession that has left more than a half-million residents dependent on unemployment checks while the state grapples with an unemployment rate of 10.4 percent for June. The national unemployment rate for June stood at 9.5 percent.
   “If we were not borrowing money, we’d have to take a higher contribution from the business community or decrease benefits, or a combination of both,” he said.
   Illinois joins 31 other states in looking to the federal account, which has been tapped for more than $39 billion nationwide. According to federal data as of Wednesday, Illinois ranks fifth in most owed at $2.2 billion, Rivara said. California leads the pack at $7.76 billion, with Michigan ranking second at $3.8 billion, New York, third at $3.1 billion, and Pennsylvania, fourth at $3 billion.
   Businesses annually pay a contribution to the state’s unemployment trust fund based on its industry and previous history of layoffs. For 2010, the amount businesses paid annually per worker ranges from $81 to $908, Rivara said.
   Because second quarter contributions have recently been collected, the state has not had to borrow from the federal account for a couple of months, Rivara said, leaving the state trust fund with a balance of $275 million.
   However, the $2.2 billion still needs to be repaid, and a likely 4 percent interest rate will be tacked on come Jan. 1, if Congress doesn’t vote to extend the waiver of interest on the loans granted by the federal stimulus program.
   Rivara noted the $2.2 billion is separate from the $13 billion budget deficit since the budget relies on General Revenue Fund dollars. GRF dollars cannot be used to repay the unemployment loan, which is repaid partially through a portion of the business contribution.
   However, that’s not enough to whittle down the entire $2.2 billion, meaning options such as borrowing, increasing the business contribution, decreasing benefits or a combination of all three may have to be looked at, Rivara said – after Congress decides whether or not to extend the loan interest waiver.
“This does not jeopardize claimants receiving benefits,” he said.
   Illinois, like other states, chances losing federal funding if it maintains a deficit balance for two Januaries in a row, Rivara said, putting at risk $1.5 billion in annual tax credits for businesses and more than $100 million annually awarded for IDES operations.
   But he also noted that because of the nature of the state unemployment trust fund and its ties to a fluctuating economy, the fund is expected to run a deficit balance at times.
   “It begs a debate of what is the appropriate fund balance for the trust fund,” he said.
   However, he said he believes Illinois is “probably through the worst of times,” noting that Illinois follows the national economy in a recovery. The nation is gaining jobs, and so is Illinois — 60,000 since the end of 2009, he said.
   An economist at the University of Illinois Urbana-Champaign agreed the worst appears to be over, but noted the pace of Illinois’ recovery is “painfully slow.”
J. Fred Giertz has the numbers to prove it in his just-released “Flash Index,” showing the Index rose to 91.6 in July, up three-tenths of a point from its June level.
   A Flash Index level below 100 indicates the economy is in contraction, while readings above 100 indicate economic growth.
   “Recessions always end, but this time it’s not going to be in six months,” Giertz said. “It’s going to be in one or two years.”
   Story courtesy of Illinois Statehouse News.

Former Madoff Securities Employee Under Scrutiny

   NEW YORK - 8/5/2010 - Preet Bharara, the United States Attorney for the Southern District of New York, announced this week the filing of an amended civil complaint seeking the forfeiture of a total of more than $5.1 million in assets from Annette Bongiorno.
   Bongiorno had spent more than 40 years working for Bernard L. Madoff Investment Securities LLC ("BLMIS"), the fraudulent investment advisory business owned and operated by Bernard L. Madoff, and the assets allegedly subject to forfeiture constitute property traceable to proceeds of Madoff's fraud.
   This week's amended verified complaint follows the filing of two civil forfeiture complaints on June 22 seeking the forfeiture of various assets controlled by Bongiorno and another long-time Madoff employee, Joanne Crupi. According to the verified amended complaint filed in Manhattan federal court today, the U.S. Attorney's Office for the Southern District of New York has been able to trace more than $2 million in additional assets under Bongiorno's control -- including houses in Florida and New York -- to her allegedly knowing participation in the massive Ponzi scheme operated through the investment advisory business of BLMIS.
   The amended Complaint seeks to forfeit property directly traceable to the BLMIS fraud, or property traceable to such property, including the following:
   1. A house in Manhasset, New York, for which Bongiorno paid approximately $1.4 million.
   2. A house in Boca Raton, Florida, for which Bongiorno paid approximately $862,000.
   3. Approximately $1.1 million currently or formerly held in accounts at Citibank, Morgan Stanley Smith Barney, and HSBC;
   4. A 2005 Bentley Continental, for which Bongiorno paid approximately $182,605;
   5. A 2007 Mercedes Benz, for which Bongiorno paid approximately $90,000;
   6. Another 2007 Mercedes Benz, for which Bongiorno paid approximately $66,000; and
   7. Approximately $1.3 million paid towards a luxury condominium.
   The United States Attorney's Office for the Southern District of New York will ask that property forfeited in the civil case announced today be liquidated and used to compensate victims of the BLMIS fraud.\
   According to the amended Complaint, a number of former BLMIS employees have already been charged criminally. No criminal charges have been filed against Bongiorno.
   Bharara  praised the work of the Federal Bureau of Investigation; the Internal Revenue Service; the U.S. Department of Labor's Employee Benefits Security Administration and Office of the Inspector General; and the United States Marshals Service. He also thanked the Securities and Exchange Commission and the Securities Investor Protection Corporation Trustee for their assistance.
  This case was brought in coordination with the Financial Fraud Enforcement Task Force, on which Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group.
   Assistant United States Attorneys Lisa A. Baroni, Julian J. Moore, Barbara A. Ward and Matthew L. Schwartz are in charge of the cases.
   Source: Financial Fraud Enforcement Task Force

Two Charged With $2.4 Million Fraud Scheme

   CHARLESTON, W. Va. – 8/4/2010 - United States Attorney R. Booth Goodwin II announced yesterday the filing of charges against two women for their roles in a $2.4 million credit union fraud scheme.
   A Federal Grand Jury sitting in Beckley, West Virginia returned an indictment against Rebecca Poe, 35, of Falls Mills, Virginia, charging her with fraud against the N&W Poca Division Federal Credit Union located in Bluefield, West Virginia.
   The indictment charges Poe, a former employee of the credit union, with taking money from the credit union from 2003 to August 2008 through various schemes. The indictment alleges that Poe created fictitious deposits into her account and the accounts of family members.
   The deposits were fictitious in that no funds were received by the credit union to support the deposits. Poe then used these funds for personal expenses after making the fictitious deposits. Similarly, the indictment alleges that Poe recorded fictitious payments on her loan accounts and those of family members without the credit union receiving funds. Additionally, Poe created manual, official checks made payable to family members and to third parties on the credit union’s account to pay for her personal expenses.
   The indictment alleges that the offense resulted in the loss of $2.4 million dollars to the credit union contributing to its failure. On October 3, 2008, the National Credit Union Administration Board placed the N and;W Poca Division Federal Credit Union into involuntary liquidation due to its insolvency.
   The indictment also alleges that Poe was aided and abetted by a former co-worker, Pamela Mullins. Mullins, 46, of Bluefield, West Virginia, is named as an aider and abettor in the indictment, but not as a defendant. However, an information was filed today against Mullins, charging her with defrauding N&W Poca Credit Union. The information alleges that Mullins engaged in similar conduct as Poe.
   If convicted, each defendant faces a maximum prison term of 30 years, a fine of $4.8 million and an order of restitution.
    The investigation was conducted as a part of U.S. President Barack Obama’s Financial Fraud Enforcement Task Force, by the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation Division.
   “This U.S. Attorney’s Office and the Department of Justice are committed to devoting all the time and resources necessary to pursue complex cases such as these. We will look especially close at cases involving persons in positions of trust as well as cases which place parts of our financial system in peril,” Goodwin said.
  Assistant United States Attorney Susan M. Robinson, Chief of the U.S. Attorney’s Office’s White Collar Crime Unit, is handling the prosecution.
   Source: Financial Fraud Enforcement Task Force

Ameren Seeks Expansion Through New Company

(Illinois Statehouse News) - 8/3/2010 - By Kevin Lee - A prominent midwest utilities corporation wants the green light on a slate of new large-scale electricity projects within a year.
   Ameren Corporation, which disburses both natural gas and electricity utilities in Illinois and Missouri, is creating a new subsidiary to manage the projects, which include running high-voltage transmission lines across the state and linking together existing power plants.
   The petition asks the federal regulatory commission to determine how midwest utilities consumers would divide the costs of the construction projects. The corporation expects a response in 60 days.
Tom Voss, President and CEO of Ameren, said expanding transmission efforts would help spur development and keep prices competitive for utilities consumers.
   “New transmission would also open up new markets for our procurement of electricity for Illinois customers. So we think that it’ll make the markets more competitive so it should eventually help with keeping costs under control,” he said.
   State Rep. Frank Mautino, D-Spring Valley, was cautiously optimistic on the idea of constructing high-voltage lines to buttress the state’s energy grid.
   “From what we hear from industry, chambers of commerce, the (Illinois) Manufacturers’ Association, is that there is a deficit of power. We haven’t really built any new generation, and so the ability to strengthen the grid has been a goal of theirs,” he said.
   One of the projects in the portfolio includes running transmission lines through the Grand Tower Power Plant in southern Illinois.
   Maureen Borkowski, the new president and CEO of the Ameren subsidiary that will oversee the transmission projects, said the project will provide energy support to the region.
   “One of the transmissions projects is a big ‘X’ with Grand Tower at the middle of that ‘X,’” Borkowski said. “The purpose for that project, primarily, is due to congestion relief as well as (improving) local area reliability.”
   Borkowski also mentioned a large-scale proposal that would run transmission lines from Missouri to Indiana, through Quincy, Ill., and could potentially link energy sources throughout the state.
   “That transmission project has a multitude of different benefits including reliability, wind integration, congestion relief. And that also happens to be on the path of the two clean-coal technology plants,  the Taylorville Energy Center and FutureGen (near Mattoon, Illinois) that are being proposed in that region,” she said.
   Neither clean-coal plant is running as of yet.
   Borkowski said that if the federal government accepts the portfolio of projects, then Ameren would have to seek further approval on the portfolio from the Midwestern Transmission Independent Service Operators, a regional nonprofit energy organization, and the state of Illinois.
   Story courtesy of Illinois Statehouse News.

Retirement Benefits for U.S. Workers Decline

   (BUSINESS WIRE) - 8/1/2010 - U.S. workers saw the value of their employer-sponsored retirement benefits -- as measured by percentage of pay -- decline by double-digit levels over a 10-year period ending in 2008, according to an analysis of eight major industries conducted by Towers Watson (NYSE, NASDAQ: TW), a global professional services company. A decrease in the value of defined benefit (DB) plans fueled the overall drop, although an increase in the value of defined contribution (DC) plans somewhat offset the total decline.
   “In the last few years, both the financial crisis and the Pension Protection Action of 2006 have been factors contributing to employers’ careful examination of their retirement plan strategies. The financial crisis also provided a wake-up call for employers to reevaluate their 401(k) plans, as their employees’ balances plummeted.”
   The Towers Watson analysis found that, from 1998 to 2008, the value of total retirement benefits provided to new, salaried employees in the eight industries studied declined by 19 percent, from 7.88 percent to 6.36 percent of pay. Total retirement benefits include DB and DC plans, retiree medical and retiree life insurance plans. The overall decline in total retirement benefits was mostly due to a 53 percent drop in the value of defined benefits, from 4.19 percent of pay in 1998 to 1.99 percent in 2008. DC benefits, meanwhile, increased by 38 percent, from 2.89 percent of pay in 1998 to 3.99 percent in 2008.
   “Virtually all employers were under pressure to reduce the cost and risk of their company-sponsored retirement benefits during the years analyzed,” said Kevin Wagner, senior retirement consultant at Towers Watson. “However, just how much they changed their programs and what level of support they could provide varied significantly based on industry-specific factors, including talent supply, cost structure and globalization.”
   According to the analysis, the largest decline in total retirement benefits from 1998 to 2008 occurred in the retail and wholesale industry -- a drop of 33 percent, from 5.72 percent of pay to 3.82 percent. Among the eight industries analyzed, only service industry workers saw the value of their retirement benefits increase — from 4.16 percent of pay to 4.30 percent of pay, an increase of 3 percent.
   According to the analysis, the largest drop in the value of DB benefits from 1998 to 2008 occurred in the retail industry (81 percent), which, along with the service industries, also provided the lowest level of defined benefits at the end of the period. The value of DC benefits increased for all of the industries analyzed, led by the pharmaceuticals and health care industries, which experienced increases of 97 percent and 87 percent, respectively.
   “This past decade witnessed a significant shift in retirement plans, as many companies replaced their traditional DB plans with DC and other account-based retirement plans for new workers,” Wagner said. “In the last few years, both the financial crisis and the Pension Protection Action of 2006 have been factors contributing to employers’ careful examination of their retirement plan strategies. The financial crisis also provided a wake-up call for employers to reevaluate their 401(k) plans, as their employees’ balances plummeted.”

The Arms Debate

Not All American's Have the Right to Bear Arms

Photo by Steve Rensberry (c) 2018