CDR Founder Pleads Guilty to Bid-Rigging, Fraud

   WASHINGTON - 12/30/2011 - A Beverly Hills, Calif.,-based financial products and services firm, and its founder and owner pleaded guilty today in the Southern District of New York for their participation in bid-rigging and fraud conspiracies related to contracts for the investment of municipal bond proceeds and other related municipal finance contracts, the Department of Justice announced.
    Rubin/Chambers, Dunhill Insurance Services, also known as CDR Financial Products, and David Rubin, CDR founder and owner, pleaded guilty before U.S. District Judge Victor Marrero in the Southern District of New York. Rubin and CDR, along with Zevi Wolmark, also known as Stewart Wolmark, the former chief financial officer and managing director of CDR, and Evan Andrew Zarefsky, a vice president of CDR, were indicted on Oct. 29, 2009. The trial for Wolmark and Zarefsky is scheduled to begin on Jan. 3, 2012, in the Southern District of New York.
   Rubin and CDR each pleaded guilty to participating in separate bid-rigging and fraud conspiracies with various financial institutions and insurance companies and their representatives. These institutions and companies, or “providers,” offered a type of contract, known as an investment agreement, to state, county and local governments and agencies throughout the United States. The public entities were seeking to invest money from a variety of sources, primarily the proceeds of municipal bonds that they had issued to raise money for, among other things, public projects. Rubin and CDR also pleaded guilty to one count of wire fraud in connection with those schemes.
    “Mr. Rubin and his company engaged in fraudulent and anticompetitive conduct that harmed municipalities and other public entities,” said Sharis A. Pozen, acting assistant attorney general in charge of the Justice Department’s Antitrust Division. “Today’s guilty pleas are an important development in our continued efforts to hold accountable those who violate the antitrust laws and subvert the competitive process in our financial markets.”
    According to court documents, CDR was hired by public entities that issue municipal bonds to act as their broker and conduct what was supposed to be a competitive bidding process for contracts for the investment of municipal bond proceeds. Competitive bidding for those contracts is the subject of regulations issued by the U.S. Department of the Treasury and is related to the tax-exempt status of the bonds.
    During his plea hearing, Rubin admitted that, from 1998 until 2006, he and other co-conspirators supplied information to providers to help them win bids, solicited intentionally losing bids, and signed certifications that contained false statements regarding whether the bidding process for certain investment agreements complied with relevant Treasury Regulations. Additionally, Rubin admitted that he and other co-conspirators solicited fees from providers, which were in fact payments to CDR for rigging or manipulating bids for certain investment agreements so that a particular provider would win that agreement at an artificially determined price.
    “Mr. Rubin and his firm were trusted with public money and confidence to assist municipalities with issuing bonds,” said FBI Assistant Director in Charge Janice K. Fedarcyk. “Contrary to his agreement and the law, Mr. Rubin shirked his responsibilities while defrauding taxpayers. Thankfully, this bid-rigging scheme, where Mr. Rubin decided the winners and losers, is over.”
   The bid–rigging conspiracy with which Rubin is charged carries a maximum penalty of 10 years in prison and a $1 million criminal fine. The fraud conspiracy with which Rubin is charged carries a maximum penalty of five years in prison and a $250,000 criminal fine. The wire fraud charge with which Rubin is charged carries a maximum penalty of 20 years in prison and a $250,000 criminal fine. The maximum fines for each of these offenses may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
    CDR faces a maximum criminal fine on the bid-rigging charge of $100 million. The fraud conspiracy and wire fraud offenses with which CDR is charged each carry a maximum criminal fine of $500,000. The maximum fines for each of these offenses may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
    Rubin is the tenth individual to plead guilty in an ongoing federal investigation into the municipal bonds industry, which is being conducted by the Antitrust Division’s New York Field Office, the FBI and IRS-CI.
    In addition, Dominick Carollo and Peter S. Grimm, formerly of GE Funding Capital Market Services, and Steven E. Goldberg, formerly of GE Funding Capital Market Services and FSA, were indicted on July 27, 2010, and are scheduled to begin trial in April 2012. Three former UBS employees, Peter Ghavami, Gary Heinz and Michael Welty, were indicted on Dec. 9, 2010.
   Source: Financial Fraud Enforcement Task Force

EPA Moves to Limit Mercury Emissions in U.S.

   WASHINGTON, D.C. – 12/24/2011 - The federal Environmental Protection Agency continued on December 11 its effort to reduce Americans’ exposure to hazardous chemicals, announcing a long-awaited new standard to reduce the amount of mercury emissions allowed from power plants in the United States.
   “Many power plants could have taken simple steps years ago to reduce mercury emissions into the environment, and with this new rule those that haven’t yet will finally be required to act,” Environmental Working Group Senior Research Analyst Sonya Lunder said. “A number of plants in the U.S. have already installed the necessary equipment to decrease the emissions of this potent neurotoxin, but many have dragged their feet while millions of people, including children have been exposed. This common-sense standard will result in incredible cost savings as measured in less illness, fewer sick days and fewer air pollution related deaths.”
   Mercury is one of the most toxic substances commonly found in the environment and people, causing permanent damage to the brain and nervous system. Much of the mercury found in the environment comes as a result of coal-fired power plant emissions, where it finds its way into the food chain and our bodies. One in six American women have mercury exposures high enough to adversely impact the developing brain and nervous system of the fetus during pregnancy.
   “This new emissions rule has been in the works for more than a decade, only to be stalled by political shenanigans,“ Lunder said. “Administrator Jackson and the president deserve credit for this major victory for children’s health.”
  In 1997 the Environmental Working Group’s analysis, “Contamination of America's Food,” concluded that fish from more than 1,660 U.S. waterways were so contaminated with mercury that they should be eaten sparingly if at all. In 2004, EWG found mercury in all 10 umbilical cord blood samples it had tested for hundreds of industrial pollutants. A similar EWG-funded study conducted five years later found that all 10 samples of cord blood of minority babies had mercury present as well.
   Source: Environmental Working Group release of 12/21/2011

Teen Cigarette, Alcohol Use Reaches Historic Low

   (NIH) - 12/20/2011 - Cigarette and alcohol use by eighth, 10th and 12th-graders are at their lowest point since the Monitoring the Future (MTF) survey began polling teenagers in 1975, according to this year’s survey results. However, this positive news is tempered by a slowing rate of decline in teen smoking as well as continued high rates of abuse of other tobacco products (e.g., hookahs, small cigars, smokeless tobacco), marijuana and prescription drugs. The survey results, announced today during a news conference at the National Press Club, appear to show that more teens continue to abuse marijuana than cigarettes; and alcohol is still the drug of choice among all three age groups queried.
   MTF is an annual survey of eighth, 10th, and 12th-graders conducted by researchers at the University of Michigan, Ann Arbor, under a grant from the National Institute on Drug Abuse (NIDA), part of the National Institutes of Health. The survey was conducted in classrooms earlier this year.
   "That cigarette use has declined to historically low rates is welcome news, given our concerns that declines may have slowed or stalled in recent years," NIDA Director Dr. Nora D. Volkow said. "That said, the teen smoking rate is declining much more slowly than in years past, and we are seeing teens consume other tobacco products at high levels. This highlights the urgency of maintaining strong prevention efforts against teen smoking and of targeting other tobacco products."
   The 2011 results showed that 18.7 percent of 12th-graders reported current (past-month) cigarette use, compared to a recent peak rate of 36.5 percent in 1997 and 21.6 percent five years ago. Only 6.1 percent of eighth-graders reported current smoking, compared to a recent peak of 21 percent in 1996 and 8.7 percent five years ago.
   "While it is good news that cigarette use has declined to historically low rates, we can and must do more to accelerate that decline," Assistant Secretary for Health Howard K. Koh, said. "The actual decline is relatively small compared to the sharp declines we witnessed in the late nineties."
   For alcohol, 63.5 percent of 12th-graders reported past year use, compared to a recent peak of 74.8 percent in 1997. Similarly, 26.9 percent of eighth-graders reported past year use of alcohol in 2011, compared to a recent peak rate of 46.8 percent in 1994. There also was a five-year decrease in binge drinking, measured as five or more drinks in a row in the past two weeks, across all three grades. Binge drinking was reported by 6.4 percent of eighth-graders, 14.7 percent of 10th-graders, and 21.6 percent of 12th-graders, down from the 2006 rates of 8.7 percent, 19.9 percent and 25.4 percent respectively.
   Despite the declines noted in the report, use of marijuana has shown some increases in recent years and remains steady. Among 12th-graders, 36.4 percent reported past year use, and 6.6 percent reported daily use, up from 31.5 and 5 percent, respectively, five years ago. The upward trend in teens' abuse of marijuana corresponded to downward trends in their perception of risk. For example, only 22.7 percent of high school seniors saw great risk in smoking marijuana occasionally, compared to 25.9 percent five years ago. Similarly, 43.4 percent of eighth-graders reported that they saw great risk in smoking marijuana occasionally, compared to 48.9 percent five years ago. In addition, concerns about the use of synthetic marijuana, known as K2 or spice, prompted its inclusion in the survey for the first time in 2011. Surprisingly, 11.4 percent of 12th-graders reported past year use.
   "K2 and spice are dangerous drugs that can cause serious harm," said Gil Kerlikowske, director of National Drug Control Policy. "We will continue to work with the public health and safety community to respond to this emerging threat but in the meantime, parents must take action. Parents are the most powerful force in the lives of young people and we ask that all of them talk to their teens today about the serious consequences of using marijuana, K2, or spice."
   There was mixed news seen in the non-medical use of prescription drugs. Abuse of the opioid painkiller Vicodin was reported by 8.1 percent of 12th graders — similar to 2010 and down from 9.7 percent in 2009. There was also a decline reported by 10th graders — to 5.9 percent from 7.7 percent in 2010. However, no such declines were seen for the opioid painkiller OxyContin.
   In 2011, the non-medical use of the ADHD medicines Adderall and Ritalin remained about the same as last year among 12th-graders, at 6.5 and 2.6 percent, respectively. There was, however, a significant decline in the abuse of over-the-counter cough medicine among eighth-graders, down to 2.7 percent in 2011 from 4.2 percent in 2006, when the survey first asked about its abuse. A similar decline in cough medicine abuse was seen among 12th-graders, to 5.3 percent from 6.9 percent five years ago.
   "To help educate teens about the dangers of prescription drug abuse, NIDA is launching an updated prescription drug section on our teen website," Volkow said. "Teens can go to our PEERx pages to find interactive videos and other tools that help them make healthy decisions and understand the risks of abusing prescription drugs. We are also encouraging teens to provide feedback on these resources through NIDA's teen blog, Sara Bellum, Twitter, Facebook, YouTube, or email." PEERx can be seen at
   Overall, 46,773 students from 400 public and private schools participated in this year's MTF survey. Since 1975, the survey has measured drug, alcohol, and cigarette use and related attitudes in 12th-graders nationwide. Eighth and 10th graders were added to the survey in 1991. Survey participants generally report their drug use behaviors across three time periods: lifetime, past year, and past month. Questions are also asked about daily cigarette and marijuana use. NIDA has providing funding for the survey since its inception by a team of investigators at the University of Michigan, led by Dr. Lloyd Johnston. Additional information on the MTF Survey, as well as comments from Dr. Volkow, can be found at To hear the audiocast of the event, visit:
   MTF is one of three major surveys sponsored by the U.S Department of Health and Human Services that provide data on substance use among youth. The others are the National Survey on Drug Use and Health and the Youth Risk Behavior Survey. The MTF website is: Follow Monitoring the Future 2011 news on Twitter at @NIDANews, or join the conversation by using: #MTF2011. Additional information on MTF can be found at; or
   The National Survey on Drug Use and Health, sponsored by the Substance Abuse and Mental Health Services Administration, is the primary source of statistical information on substance use in the U.S. population 12 years of age and older. More information is available at:
   The Youth Risk Behavior Survey, part of HHS' Centers for Disease Control and Prevention's Youth Risk Behavior Surveillance System, is a school-based survey that collects data from students in grades 9-12. The survey includes questions on a wide variety of health-related risk behaviors, including substance abuse.
   More information is available at
   Source: National Institutes of Health release of 12/14/2011

New Robotic System to Screen 10,000 Chemicals

   (NIH) - 12/13/2011 - A high-speed robotic screening system, aimed at protecting human health by improving how chemicals are tested in the United States, begins today to test 10,000 compounds for potential toxicity. The compounds cover a wide variety of classifications, and include consumer products, food additives, chemicals found in industrial processes, and human and veterinary drugs. A complete list of the compounds is publicly available at
   Testing this 10,000 compound library begins a new phase of an ongoing collaboration between the National Institutes of Health, the U.S. Environmental Protection Agency, and the U.S. Food and Drug Administration, referred to as Tox21. NIH partners include the National Toxicology Program (NTP), administered by the National Institute of Environmental Health Sciences (NIEHS), and the NIH Chemical Genomics Center (NCGC), part of the NIH Center for Translational Therapeutics (NCTT), housed at the National Human Genome Research Institute (NHGRI).
   “There has never been a compound library like this before,” NIEHS/NTP Director Linda Birnbaum said.
   Birnbaum is especially excited that some of the compounds the NTP has brought forward for testing are mixtures of chemicals. “All of us are exposed to many different chemicals at the same time, not just one chemical at a time,” she said. “These new technologies allow us to more rapidly advance our understanding of not only individual chemicals, but mixtures of chemicals as well.”
   A subset of the NTP portion of the 10,000 compound library will focus on pilot testing several formulations or mixtures of compounds, a priority area for NIEHS/NTP. The library constituents were selected after a thorough analysis of existing scientific studies, more than 200 public chemical databases, and chemical nominations received from internal and external partners. Each test compound will undergo a thorough chemical analysis to verify its identity and determine its purity, concentration, and stability.
   The goal of the testing is to provide results that will be useful for evaluating if these chemicals have the potential to disrupt processes in the human body to an extent that leads to adverse health effects.
   The compounds will be tested in the Tox21 robotic screening system at the NCGC in Rockville, Md. The Tox21 robot, unveiled earlier this year, was purchased with funds provided by the NTP as part of its contribution to the Tox21 partnership.
   “The robot has undergone rigorous testing since it was installed and unveiled earlier this year. It’s ready to start testing this large compound library,” NHGRI Director Eric Green said. “This is a milestone for Tox21, because it will allow us to test chemicals at a rate previously impossible for anyone to do by hand.”
   The development of methods for evaluating chemical toxicity has the potential to revolutionize the assessment of new environmental chemicals and the development of new drugs for therapeutic use.
   “We are happy to contribute NCGC’s pharmaceutical collection of approximately 3,500 compounds of approved and investigational drugs as part of the Tox21 program,” NCTT Scientific Director Christopher Austin said. “Drug toxicity is one of the primary reasons that the development of new drugs fails and approved drugs are removed from the market, and the ability to better predict toxicity would improve the efficiency of drug development enormously.”
   The EPA seeks to understand the molecular basis of such chemicals to better protect human health and that of the environment.
   “The Tox21 partnership integrates revolutionary advances in molecular biology, chemistry, and computer science, to quickly and cost-effectively screen the thousands of chemicals in use today,” said Paul Anastas, assistant administrator of the EPA Office of Research and Development. “The innovative robotics screening technology will generate chemical toxicity data that EPA has never had before.”
   The FDA, also a partner in Tox21, emphasizes the value of this effort for the public. “The Tox21 rapid assessment of drug toxicity can become a powerful safety tool for protecting the American public. It also has the potential to help bring innovative drugs to market by allowing drug developers to identify unsafe candidate drugs early,” said Janet Woodcock, M.D., director of the FDA Center for Drug Evaluation and Research.
  All testing results will be available to the public through NIH and EPA chemical toxicity databases. In addition, NCTT has created a Tox21 chemical inventory browser freely available at to provide researchers with additional about the chemicals. For more information about Tox21, visit
   The NIEHS supports research to understand the effects of the environment on human health and is part of NIH. For more information on environmental health topics, visit Subscribe to one or more of the NIEHS news lists to stay current on NIEHS news, press releases, grant opportunities, training, events, and publications.
   The NTP is an interagency program established in 1978. The program was created as a cooperative effort to coordinate toxicology testing programs within the federal government, strengthen the science base in toxicology, develop and validate improved testing methods, and provide information about potentially toxic chemicals to health, regulatory, and research agencies, scientific and medical communities, and the public.  
   The NTP is headquartered at the NIEHS. For more information about the NTP, visit
   Source: National Institutes of Health release of December 7, 2011.

Autism Research Data Source Called Largest

   (NIH) - 12/13/2011 - A data partnership between the National Database for Autism Research (NDAR), and the Autism Genetic Resource Exchange (AGRE) positions NDAR as possibly the largest repository to date of genetic, phenotypic, clinical, and medical imaging data related to research on autism spectrum disorders (ASD), according to a recent news release from the National Institutes of Health.
   "The collaboration between AGRE and NDAR exemplifies the efforts of government and stakeholders to work together for a common cause," said Thomas R. Insel, M.D., director of the National Institute of Mental Health, part of NIH. "NDAR continues to be a leader in the effort to standardize and share ASD data with the research community, and serves as a model to all research communities." 
   NDAR is supported by the National Institutes of Health; AGRE is an Autism Speaks program.  NDAR's mission is to facilitate data sharing and scientific collaboration on a broad scale, providing a shared common platform for autism researchers to accelerate scientific discovery. Built around the concept of federated repositories, NDAR integrates and standardizes data, tools, and computational techniques across multiple public and private autism databases. 
   Through NDAR, researchers can access results from these different sources at the same time, using the rich data set to conduct independent analyses, supplement their own research data, or evaluate the data supporting published journal articles, among many other uses. Databases previously federated with NDAR include Autism Speaks' Autism Tissue Program, the Kennedy Krieger Institute's Interactive Autism Network (IAN), and the NIH Pediatric MRI Data Repository. 
   AGRE currently houses a clinical dataset with detailed medical, developmental, morphological, demographic, and behavioral information from people with ASD and their families. Approved NDAR users will have access to data from the 25,000 research participants represented in NDAR, as well as 2,500 AGRE families and more than 7,500 participants who reported their own information to IAN. NDAR is supported by NIMH, the Eunice Kennedy Shriver National Institute of Child Health and Human Development, the National Institute of Neurological Disorders and Stroke, the National Institute of Environmental Health Sciences, and the NIH Center for Information Technology. 
   According to the NIMH, it's mission is to transform the understanding and treatment of mental illnesses through basic and clinical research, paving the way for prevention, recovery and cure.

Wachovia Bank Admits to Anticompetitive Conduct

   WASHINGTON - 12/10/2011 - Wachovia Bank N.A., which is now known as Wells Fargo Bank N.A., has entered into an agreement with the Department of Justice to resolve the company’s role in anticompetitive activity in the municipal bond investments market and has agreed to pay a total of $148 million in restitution, penalties and disgorgement to federal and state agencies, the Department of Justice announced today.
   As part of its agreement with the department, Wachovia admits, acknowledges and accepts responsibility for illegal, anticompetitive conduct by its former employees. According to the non-prosecution agreement, from 1998 through 2004, certain former Wachovia employees at its municipal derivatives desk entered into unlawful agreements to manipulate the bidding process and rig bids on municipal investment and related contracts. These contracts were used to invest the proceeds of, or manage the risks associated with, bond issuances by municipalities and other public entities.
    “The illegal conduct at Wachovia Bank corrupted the bidding practices for investment contracts and deprived municipalities of the competitive process to which they were entitled,” said Sharis A. Pozen, acting assistant attorney general in charge of the Department of Justice’s Antitrust Division. “Today’s resolution achieves restitution for the victims harmed by Wachovia’s anticompetitive conduct and ensures that Wachovia disgorges its ill-gotten gains and pays penalties for its illegal conduct. We are committed to ensuring competition in the financial markets and our investigation into anticompetitive conduct in the municipal bond derivatives industry continues.”
   Under the terms of the agreement, Wachovia agrees to pay restitution to victims of the anticompetitive conduct and to cooperate fully with the Justice Department’s Antitrust Division in its ongoing investigation into anticompetitive conduct in the municipal bond derivatives industry. To date, the ongoing investigation has resulted in criminal charges against 18 former executives of various financial services companies and one corporation. Nine of the 18 executives charged have pleaded guilty.
   The Securities and Exchange Commission (SEC), the Internal Revenue Service (IRS), the Office of the Comptroller of the Currency (OCC) and 26 state attorneys general also entered into agreements with Wachovia requiring the payment of penalties, disgorgement of profits from the illegal conduct and payment of restitution to the victims harmed by the manipulation and bid rigging by Wachovia employees, as well as other remedial measures.
   As a result of Wachovia’s admission of conduct; its cooperation with the Department of Justice and other enforcement and regulatory agencies; its monetary and non-monetary commitments to the SEC, IRS, OCC and state attorneys general; and its remedial efforts to address the anticompetitive conduct, the department agreed not to prosecute Wachovia for the manipulation and bid rigging of municipal investment and related contracts, provided that Wachovia satisfies its ongoing obligations under the agreement.
   Earlier this year, JPMorgan Chase & Co. and UBS AG also entered into agreements with the Department of Justice and other federal and state agencies to resolve anticompetitive conduct in the municipal bond derivatives market. In July 2011, JPMorgan agreed to pay a total of $228 million in restitution, penalties and disgorgement to federal and state agencies for its role in the conduct. In May 2011, UBS AG agreed to pay a total of $160 million in restitution, penalties and disgorgement to federal and state agencies for its participation in the anticompetitive conduct.
    The department’s ongoing investigation into the municipal bonds industry is being conducted by the Antitrust Division, the FBI and the IRS-Criminal Investigation. The department is coordinating its investigation with the SEC, the OCC and the Federal Reserve Bank of New York. The department thanks the SEC, IRS, OCC and state attorneys general for their cooperation and assistance in this matter.
   The Antitrust Division, SEC, IRS, FBI, state attorneys general and OCC are members of the Financial Fraud Enforcement Task Force. For more information, visit

Lafarge North America Inc. to Pay $740,000 Penalty

   WASHINGTON - 12/4/2011 - Lafarge North America Inc., one of the largest suppliers of construction materials in the United States and Canada, and four of its U.S. subsidiaries have agreed to resolve alleged Clean Water Act violations. The violations include unpermitted discharges of stormwater at 21 stone, gravel, sand, asphalt and ready-mix concrete facilities in Alabama, Colorado, Georgia, Maryland, and New York. Stormwater flowing over concrete manufacturing facilities can carry debris, sediment and pollutants, including pesticides, petroleum products, chemicals and solvents, which can have a significant impact on water quality.
   “The EPA is committed to protecting America’s waters from polluted stormwater runoff,” said Cynthia Giles, EPA assistant administrator for the Office of Enforcement and Compliance Assurance. “Today’s (Nov. 29) settlement will improve stormwater management at facilities across the nation, preventing harmful pollutants from being swept into local waterways.”
   “Owners and operators of industrial facilities must take the necessary measures to comply with stormwater regulations under the Clean Water Act, which protects America’s rivers, lakes, and sources of drinking water from harmful contamination,” said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “The system-wide management controls and training that this settlement requires from Lafarge and its subsidiaries will result in better management practices and a robust compliance program at hundreds of facilities throughout the nation that will prevent harmful stormwater runoff.”
   Lafarge will implement a nationwide evaluation and compliance program at 189 of its similar facilities in the United States to ensure they meet Clean Water Act requirements. Lafarge will also pay a penalty of $740,000 and implement two supplemental environmental projects, in which the company will complete conservation easements to protect approximately 166 acres in Maryland and Colorado. The value of the land has been appraised at approximately $2,95 million. Lafarge will also implement one state environmentally beneficial project valued at $10,000 to support environmental training for state inspectors.
   The comprehensive evaluation will include a compliance review of each facility’s permit, an inventory of all discharges to U.S. waters, and identification of all best management practices in place. In addition, Lafarge must identify an environmental vice president, responsible for coordinating oversight of compliance with stormwater requirements, at least two environmental directors, to oversee stormwater compliance at each operation, and an onsite operations manager at each facility. The U.S. estimates that Lafarge will spend approximately $8 million over five years to develop and maintain this compliance program.
   The company will also develop and implement an extensive management, training, inspections, and reporting system to increase oversight of its operations and compliance with stormwater requirements at all facilities that it owns or operates.
   The complaint, filed in federal court with the settlement, alleges a pattern of violations since 2006 that were discovered after several federal inspections at the company’s facilities. The alleged violations included unpermitted discharges, violations of effluent limitations, inadequate management practices, inadequate or missing records and practices regarding stormwater compliance and monitoring, inadequate discharge monitoring and reporting, inadequate stormwater pollution prevention plans, and inadequate stormwater training.
   The Clean Water Act requires that industrial facilities, such as ready-mix concrete plants, sand and gravel facilities and asphalt batching plants, have controls in place to prevent pollution from being discharged with stormwater into nearby waterways. Each site must have a stormwater pollution prevention plan that sets guidelines and best management practices that the company will follow to prevent runoff from being contaminated by pollutants.
   Since being notified of the violations by EPA, the company has made significant improvements to its stormwater management systems.
   The settlement is the latest in a series of federal enforcement actions to address stormwater violations from industrial facilities and construction sites around the country. The states of Maryland and Colorado are co-plaintiffs and have joined the proposed settlement.
   Lafarge is required to pay the penalty within 30 days of the court’s approval of the settlement.
   Source: U.S. EPA release. For additional information about this case, see Settlement.

Survey: Cell Phones Cited as Safety Concern

   SACRAMENTO, Calif. - (BUSINESS WIRE) - 12/1/2011 - In a dramatic turnaround, California drivers ranked cell phone talking and texting as the biggest safety problems on the road in 2011, decisively moving past the top problems of 2010, which were speeding and aggressive driving. These and other opinions of driving habits are included in the results of the second annual Traffic Safety Survey, released today by the California Office of Traffic Safety (OTS).
   “This information provides us with unique insight into the concerns of Californians. It is very telling that we’ve seen such a shift in opinions on cell phone use in just one year.”
   In 2010, 21.5 percent of drivers thought that speeding and aggressive driving were the biggest problems, followed by cell phone talking and texting, which totaled 18.3 percent combined. In the latest 2011 results, speeding and aggressive driving dropped to 17.6 percent, while those worried about drivers using cell phones more than doubled to 38.8 percent. Drunk driving was next on the list, replacing last year’s “bad roads,” with 12.6 percent of respondents considering it most dangerous.
   “This second year of surveying the opinions and habits of California’s drivers shows how quickly they react to the real problems we all face on the road,” said OTS Director Christopher J. Murphy. “This information provides us with unique insight into the concerns of Californians. It is very telling that we’ve seen such a shift in opinions on cell phone use in just one year.”
   In the most distracting category, combined cell phone talking and texting jumped from 75 percent to 84 percent. Those who say they still use handheld phones for either talking or texting dropped from last year, while those who say that they have been hit or nearly hit by someone talking or texting on a cell phone increased.
  Drivers are a bit more aware of the anti-drunk driving message, with more actually saying that they aren’t drinking at all. In addition, drivers are more aware of DUI checkpoints, and at a high 88 percent approval rate, the vast majority of California drivers support them as well. More people are also aware of the Click It or Ticket seat belt campaign and buckle up because of it.
   The statewide survey was fielded in late summer and 1,801 drivers age 18 and over were interviewed at gas stations in 15 counties throughout California. The results will help the California Office of Traffic Safety and those involved in the Strategic Highway Safety Plan better identify and track driver attitudes, self-reported driving behavior, awareness of high visibility enforcement efforts and safety communications.
   “Having this second year of results is very helpful,” Murphy said. “It has validated what we took from the first year and is beginning to show trends. It is providing valuable data for our planning, particularly in distracted driving programs and the emerging drugged driving problem.”
   Additional results include:
  • Drunk driving was the biggest safety concern of the 18-24 year old age group, at 30.3 percent, up from 11.5 percent in 2010. This age group also lead in those who report that they have recently had too much alcohol to drive safely. 
  • A larger percentage of drivers (40.4 percent) say they talk less on their phones while driving than last year (34.5 percent) because of the hands-free law. 
  • 45.8 percent say that they have made driving mistakes while talking on cell phones. 60.1 percent say that they have been hit or nearly hit by other drivers who were talking or texting. 
  • A higher percentage of 18-24 year olds than any other age group think that texting while driving is a serious distraction, yet more of them actually do text and drive than any other age group. 
  • There are differences between what Northern and Southern Californians think are the biggest problems. 33.2 percent of Southern Californians think texting ranks high, while 25.7 percent of Northern Californians think so. Similarly, 25.6 percent in the southland think drunk driving is the biggest problem while 15.2 percent in the north rank it at the top. 
  • 25-44 year-olds lead in hands-free cell phone talking, even though it is no more safe than hand-held talking. 
  • 71.9 percent think that the Report Drunk Drivers – Call 911 campaign has helped police make more DUI arrests. 
  • 88.3 percent support the use of DUI checkpoints 

Estate Planning CEO, Employee Face Charges

Indictment Alleges Defrauding of Terminally-ill and Elderly
   PROVIDENCE, R.I. - 11/26/2011 - A Rhode Island attorney and an employee of his Cranston, R.I., estate planning company were charged in a 66-count federal grand jury indictment returned November 17 alleging that they conspired to steal and to use the identities of terminally-ill patients and elderly individuals to obtain more than $25 million in illicit profits from insurance companies and bond issuers.
   Attorney Joseph A. Caramadre, 49, president, CEO and majority owner of Estate Planning Resources, and Raymour Radhakrishnan, 27, an employee of Estate Planning Resources, are charged with conspiracy and multiple counts of mail fraud; wire fraud; identity theft; aggravated identity theft; and money laundering. Caramadre is also charged with one count of witness tampering.
   The two-year investigation and indictment were announced by Peter F. Neronha, U.S. Attorney for the District of Rhode Island; Richard DesLauriers, Special Agent in Charge of the FBI’s Boston Field Office; Robert Bethel, Inspector in Charge of the Postal Inspection Service (USPIS), Boston Division; and William P. Offord, Special Agent in Charge of the Boston Office of the Internal Revenue Service – Criminal Investigation (IRS-CI).
   The indictment alleges that Caramadre and Radhakrishnan made misrepresentations to terminally-ill and elderly patients and their family members in order to obtain their personal identity information. It is alleged they used the information, including names; dates of birth; and social security numbers, to obtain more than 200 variable annuities and to open more than 75 brokerage accounts in order to purchase “death-put” bonds in the victims’ names without their knowledge and consent. It is alleged that the defendants either forged the signatures of terminally-ill people on account documents or obtained the signatures by means of misrepresentations. When the terminally- ill person died, it is alleged that Caramadre and others reaped substantial profits by exercising death benefits associated with the investments. The scheme allegedly generated more than $25 million in illicit profits.
   It is alleged that Caramadre launched the scheme in 1995. Radhakrishnan is alleged to have begun participating in the scheme when he was hired by Caramadre in 2007.
   According to the indictment, one means by which the defendants undertook their alleged scheme was to regularly place advertisements in the Rhode Island Catholic newspaper, offering a $2,000 charitable gift to people suffering from a terminal illness. It is alleged that Radhakrishnan met with individuals and their family members who responded to the advertisement and gave them money on Caramadre’s behalf, while, at the same time, making an assessment as to the life expectancy of the person. It is alleged that if Radhakrishnan believed the person was likely to die in the near future, he would tell them Caramadre had more money available for them. Radhakrishnan and Caramadre then allegedly either forged the terminally-ill person’s signatures or obtained their signatures on account opening documents by making misrepresentations and omissions about the nature of the documents.
   The indictment alleges that some terminally-ill people were misled when they were told their signatures were needed for receipts documenting Caramadre’s charitable gift.
   Others were allegedly misled when they were told that an account would be opened to benefit the terminally-ill person’s surviving family members, or that an account would be opened to benefit other families suffering from terminal illness. The indictment alleges that Caramadre and Radhakrishnan concealed from the terminally-ill people, their families and care givers that Caramadre and his investors stood to make a substantial profit from their deaths.
   In addition, the indictment alleges that Caramadre and Radhakrishnan made numerous misrepresentations to insurance companies, brokerage houses and other corporate entities. It is alleged that they falsely claimed that the terminally-ill people were clients of Caramadre’s law practice and that the terminally-ill people were not paid or given money to become annuitants. It is also alleged that the defendants misrepresented the financial assets and investment experience of the terminally-ill people; misrepresented the relationship between the terminally-ill people and Caramadre or his clients; that the proceeds of the accounts would go to the terminally-ill; falsely claimed that Caramadre paid for the terminally-ill people’s burial expenses at the request of the Catholic Church; and concealed Caramadre’s ownership interest in many of the investments.
   According to the indictment, Caramadre attracted capital from wealthy and prominent individuals and corporations as investors by telling them that he discovered a “loophole” which permitted the use of terminally-ill persons on variable annuities and as co-owners on joint brokerage accounts to be used to purchase death-put bonds. Caramadre allegedly entered into profit-sharing agreements with some of these outside investors, through which Caramadre allegedly received a significant percentage of all profits earned.
The indictment seeks the forfeiture by Caramadre of property derived from the scheme.
An indictment is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
   The case is being prosecuted by Assistant U.S. Attorneys Lee H. Vilker and John P. McAdams of the District of Rhode Island.
   Source: Financial Fraud Enforcement Task Force

Pending Home Sales Rise in California in October

   LOS ANGELES - (BUSINESS WIRE) - 11/22/2011 - Pending home sales in California rose in October and were up from the previous year for the sixth consecutive month. Additionally, distressed home sales rose in October from both the previous month and year, the California Association of REALTORS® (C.A.R.) reported on Nov. 21.
Pending home sales

   California pending home sales climbed 3.1 percent in October and were up from a year ago, according to C.A.R.’s Pending Home Sales Index (PHSI)*. The index was 122.0 in October, based on contracts signed in that month, up from September’s index of a revised 118.2. The index also was up 10.7 percent from October 2010. October marked the sixth consecutive month that pending sales rose from the previous year. Pending home sales are forward-looking indicators of future home sales activity, providing information on the future direction of the market.
   “October’s increase in pending sales is encouraging, especially the six straight months of year-over-year increases,” said C.A.R. President LeFrancis Arnold. “Despite all the challenges the housing market has faced this year, California home sales continue to perform modestly well and should be on pace to match or better last year’s level.”
Distressed housing market data
  • At 53.9 percent, equity sales made up more than half of home sales in October, down from 55.5 percent in September and 55.2 percent in October 2010.
  • While equity sales have edged down from their peak of 57.1 percent in July 2011, they are up from the beginning of the year when less than half (46.5 percent) of sales were non-distressed.
  • The total share of all distressed property types sold statewide rose to 46.1 percent in October, up from September’s 44.5 percent and 44.8 percent in October 2010.
  • Of the distressed properties sold statewide in October, 20.7 percent were short sales, slightly up from the previous month’s share of 20.1 percent and up from last October’s share of 19.7 percent.
  • At 24.9 percent, the share of REO sales was up from September’s 24.0 percent, and slightly up from the 24.8 percent reported in October 2010.

Man Pleads Guilty to Mortgage Fraud Scheme

   CHARLESTON, W.Va. — 11/17/2011 - A Utah man pleaded guilty on November 10 in federal court before U.S. District Judge Thomas E. Johnston to charges connected to a multimillion-dollar mortgage fraud scheme involving properties at a Hurricane, W.Va., subdivision.
   Michael S. Hurd, 37, of Salt Lake City, pleaded guilty to conspiracy to commit wire fraud and bank fraud. The defendant also pleaded guilty to mail fraud arising out of his involvement in a similar scheme in Modesto, Calif.
   Hurd admitted that during the early and mid-2000's, he operated a company called "The Gift Program," which he described as a "seller funded down payment assistance program" used to provide home buyer's money to make the down payment and initial mortgage payments on real estate purchases. Hurd further admitted that he used The Gift Program to create an elaborate scheme to defraud lenders by concealing the transfer of loan funds to the borrower from the lender. In essence, through the use of The Gift Program, lenders unwittingly funded their own down payment and made the initial mortgage payments.
   Hurd admitted that in 2006 he became involved with Deborah and Todd Joyce of Hurricane in the "flipping" of homes in the Stonegate subdivision in that town. Deborah Joyce obtained inflated appraisals from two local appraisers, James Thornton and Mark Greenlee, and subsequently sent the appraisals on to another co-conspirator Raymond Morris in Salt Lake City. Morris identified investors to purchase those properties at fraudulently inflated prices. Morris then got those investors in contact with Hurd, who then used The Gift Program to conceal the transfer of a portion of the loan proceeds to the investor from the lender. Hurd admitted that he paid Morris an undisclosed "commission" for this referral.
   Hurd also admitted that during the scheme, he wired additional loan funds to the investor to make initial mortgage payments. Once those funds ran out, the investors defaulted on the loans and the properties went into foreclosure. All told, Hurd, Joyce and Morris illegally flipped six properties in the Stonegate subdivision. The respective lender losses total almost $2 million.
   At the same time, Morris and Hurd orchestrated a similar investment-type scheme in Modesto. Hurd acknowledged that he was involved in illegally flipping 20 properties with losses in excess of $5.5 million. As part of his plea agreement, Hurd agreed to transfer those charges from the Eastern District of California to the Southern District of West Virginia so the matters could be disposed of jointly.
   Hurd faces up to 60 years in prison and a $2 million fine when he is sentenced on Feb. 29, 2012.
   Deborah Joyce was sentenced in April 2011 to 46 months in prison for her role in the scheme. Todd Joyce received an 18-month prison sentence. Thornton and Greenlee are set to be sentenced in December 2011. Hurd's co-conspirator, Raymond P. Morris, was charged in September 2011 and his trial is set for Feb. 28, 2012.
   This case is being investigated by the FBI and the Internal Revenue Service – Criminal Investigation. Assistant U.S. Attorney Thomas Ryan from the Southern District of West Virginia is in charge of the prosecution.
   Source: Financial Fraud Enforcement Task Force, U.S. Department of Justice.

NIH Grantees Rebut Flu Strain/Tropics Theory

   (NIH) - 11/16/2011 - Influenza researchers have found that flu strains migrate back and forth between different regions of the world, evolving along the way. This is contrary to the common belief that flu strains from the tropics are the source of global seasonal epidemics.
   The research appeared online on Nov. 14 in the Proceedings of the National Academy of Sciences. It was supported in part by the Centers of Excellence for Influenza Research and Surveillance and the Influenza Genome Sequencing Project, funded by the National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health.
   "This study helps us to better understand why the persistence, movement and evolution of flu viruses are complex and largely unpredictable," said NIAID Director Anthony S. Fauci, M.D. "These findings also remind us of the importance of maintaining vigilance in our global influenza surveillance efforts."
   Previous studies had shown that in general, influenza viruses in tropical regions tend to be more varied and circulate year-round rather than seasonally, like flu viruses found in temperate regions with more moderate climates. The prevailing theory had been that tropical areas of the world may be the source of flu viruses from which new seasonal flu strains originate.
   To test this theory, researchers led by Justin Bahl, Ph.D., and Gavin J.D. Smith, Ph.D., of the Duke-National University Graduate Medical School in Singapore, genetically analyzed strains of H3N2 influenza virus, a common cause of seasonal influenza among humans, collected between 2003 and 2006. They sequenced the full genome of 105 flu virus samples from Hong Kong and compared these with H3N2 virus sequences obtained from seven geographic areas with varying climates, including five temperate regions (Australia, Europe, Japan, the United States, and New Zealand) and two tropical regions (Hong Kong and Southeast Asia). The strains were arranged into a phylogenetic, or family, tree, showing the relationships between the strains and how they evolved over time.
   "Earlier genetic studies had looked at H3N2 in a global context and concluded that new strains came from the tropics," said Dr. Bahl. "However, in those studies, a lot of key genetic data from the tropics was missing." This made it difficult to draw a firm conclusion about the origin of new flu strains, he said.
   The researchers found that in temperate regions where flu seasons are relatively short, many new H3N2 virus strains arise every year, but they rarely persist from one season to the next. However, in Hong Kong and Southeast Asia, where flu seasons occur for longer periods of time, strains do persist between seasons.
   Keeping these patterns in mind, the investigators traced the geographical movement of the strains to determine whether new flu strains actually originate in tropical regions. Instead, they found that influenza strains frequently migrate back and forth between tropical and temperate regions, and that the tropical regions were not necessarily the source of new strains.
   In fact, none of the seven temperate and tropical regions they examined was the source of all new H3N2 flu strains in a given year. The migration pattern was more complex. Virus strains moved from one region to several others each year, and flu outbreaks were traced back to more than one source. And although the virus that migrated between Southeast Asia and Hong Kong persisted over time, its persistence was caused by the introduction of virus from the temperate regions. Therefore, the tropical regions did not maintain a source for the annual H3N2 influenza epidemics. Further, in contrast to annual flu epidemics in temperate climates, relatively low levels of genetic diversity among flu strains, and no seasonal fluctuations were found in the tropical regions.
   "We found that the H3N2 influenza virus population is constantly moving between regions, and every region is a potential source for new epidemics," Bahl said. "Regions with more connections to others, such as travel centers, may contribute more to the global diversity of circulating viruses."
   The complexity of the global virus circulation found in the study suggests that efforts to control flu should include region-specific strategies, according to the researchers. In future studies, the researchers intend to examine whether the virus behaves differently in temperate and tropical areas, including regions not included in this analysis, and in places that are more or less connected to the rest of the world.
   The new findings build on earlier influenza virus evolution research funded in part by NIAID
   Source: National Institutes of Health.

Study Slams Proposed Switch To Dollar Coin

   WASHINGTON - (BUSINESS WIRE) - 11/12/2011 - A pivotal independent economic study released on Nov. 7 found the proposed Congressional legislation to drop the dollar bill in favor of the dollar coin will cost Washington businesses millions of dollars as well as jobs.
   The study, titled “The Economic Impact of a Transition from Dollar Bills to Dollar Coins on the Retail and Service Sectors of the United States Economy,” was conducted by the independent economics research firm John Dunham & Associates.
   Examining the financial and operational costs to 29 different retail and service sectors across the country, the study found a transition to dollar coins would increase annual costs in Washington by $4.48 million and lead to an estimated annual loss of $10.99 million in business activity, as well as costing jobs.
   Nationwide, the switch would increase annual costs by $201.85 million and lead to at least 4,300 job losses. In addition, these implications did not incorporate the additional capital expenses - new cash registers, change counting machines, cash drawers, larger safes, etc. - and costs to banks, money transfer companies and other financial firms.
   “Essentially, changing to a coin would be a tax increase on retail and service firms of all sizes in Washington,” said John Dunham, president of John Dunham & Associates. “Washingtonians are already struggling with a poor economy and high unemployment rates, and forcibly removing the dollar bill from circulation will only exacerbate these problems.”
   This independent economic study showed that the switch to the dollar coin would impact the private sector in Washington very negatively. There are no short- or long-term savings for Americans associated with abandoning the dollar bill in favor of a dollar coin.
   Correspondingly, a new public opinion poll conducted by Frank Luntz highlights Americans’ opposition to the switch. When given a choice between the dollar bill and the dollar coin, 83 percent of respondents favored the bill. The study also found:
  • 85 percent believe the public, rather than the government, should decide what kind of currency to use;
  • 73 percent felt that the switch to the dollar coin is a gimmick designed as a cost-cutting measure;
  • 97 percent believe the $1 bill is more convenient to carry than coins;
  • 64 percent oppose legislation designed to remove the $1 bill from circulation and only seven percent strongly support it.
   “I could not be more emphatic: the American people do NOT want a dollar coin. Period,” said Luntz. “To Americans, this move is just another gimmick disguised as a cost-cutting measure.”
   WASHINGTON- (BUSINESS WIRE) - 11/12/2011 - A pivotal independent economic study released on Nov. 7 found the proposed Congressional legislation to drop the dollar bill in favor of the dollar coin will cost Washington businesses millions of dollars as well as jobs.
   The study, titled “The Economic Impact of a Transition from Dollar Bills to Dollar Coins on the Retail and Service Sectors of the United States Economy,” was conducted by the independent economics research firm John Dunham & Associates.
   Examining the financial and operational costs to 29 different retail and service sectors across the country, the study found a transition to dollar coins would increase annual costs in Washington by $4.48 million and lead to an estimated annual loss of $10.99 million in business activity, as well as costing jobs.
   Nationwide, the switch would increase annual costs by $201.85 million and lead to at least 4,300 job losses. In addition, these implications did not incorporate the additional capital expenses - new cash registers, change counting machines, cash drawers, larger safes, etc. - and costs to banks, money transfer companies and other financial firms.
   “Essentially, changing to a coin would be a tax increase on retail and service firms of all sizes in Washington,” said John Dunham, president of John Dunham & Associates. “Washingtonians are already struggling with a poor economy and high unemployment rates, and forcibly removing the dollar bill from circulation will only exacerbate these problems.”
   This independent economic study showed that the switch to the dollar coin would impact the private sector in Washington very negatively. There are no short- or long-term savings for Americans associated with abandoning the dollar bill in favor of a dollar coin.
   Correspondingly, a new public opinion poll conducted by Frank Luntz highlights Americans’ opposition to the switch. When given a choice between the dollar bill and the dollar coin, 83 percent of respondents favored the bill. The study also found:
  • 85 percent believe the public, rather than the government, should decide what kind of currency to use;
  • 73 percent felt that the switch to the dollar coin is a gimmick designed as a cost-cutting measure;
  • 97 percent believe the $1 bill is more convenient to carry than coins;
  • 64 percent oppose legislation designed to remove the $1 bill from circulation and only seven percent strongly support it.
   “I could not be more emphatic: the American people do NOT want a dollar coin. Period,” Luntz said. “To Americans, this move is just another gimmick disguised as a cost-cutting measure.”

Study: Pre-birth brain growth issues tied to autism

   (NIH) - 11/9/2011 - Children with autism have more brain cells and heavier brains compared to typically developing children, according to researchers partly funded by the National Institutes of Health. Published in the Journal of the American Medical Association on Nov. 9, 2011, the small, preliminary study provides direct evidence for possible prenatal causes of autism.
   "Earlier studies of head circumference and early brain overgrowth have pointed us in this direction, but there have been few quantitative neuroanatomical studies due to the lack of post-mortem tissue from children with autism," said Thomas R. Insel, M.D., director of the National Institute of Mental Health (NIMH), part of NIH. "These new results, along with an earlier study reporting altered wiring of the prefrontal cortex, focus our attention on this critical area of the brain in autism."
  The prefrontal cortex is involved in various higher order functions such as language and communication, social behavior, mood, and attention. Children who have autism tend to show deficits in such functions.
   Eric Courchesne, Ph.D., of the University of San Diego School of Medicine Autism Center of Excellence, and colleagues conducted direct counts of brain cells in specific regions of the prefrontal cortex in postmortem brains of seven boys who had autism and six typically developing males, ranging in age from 2-16 years. Most participants had died in accidents, but the researchers did not base their selection on causes of death.
   To assist in this task, the researchers used a computerized tissue analysis system developed by co-investigator and NIMH grantee Peter Mouton, Ph.D., of the University of South Florida, Tampa, and colleagues.
   The researchers found that children with autism had 67 percent more neurons in the prefrontal cortex and heavier brains for their age compared to typically developing children. Since these neurons are produced before birth, the study's findings suggest that faulty prenatal cell birth or maintenance may be involved in the development of autism. Another possible factor that may contribute to the neuronal excess is a reduction in apoptosis, or programmed cell death, which normally occurs during the third trimester and early postnatal life.
   Though small, this preliminary study examined all relevant postmortem tissue available at the time. The relative scarcity of tissue from very young children may limit future research as well, but efforts to include a larger number of samples are needed to confirm these findings and to identify patterns of age-related changes in autism.
   This study was funded by Autism Speaks, Cure Autism Now, The Emch Foundation, the Simons Foundation, the Thursday Club Juniors, and the UCSD-NIH Autism Center of Excellence, which is supported by NIMH, the National Institute of Neurological Disorders and Stroke, and the Eunice Kennedy Shriver National Institute of Child Health and Human Development.
   The mission of the NIMH is to transform the understanding and treatment of mental illnesses through basic and clinical research, paving the way for prevention, recovery and cure. For more information, visit the NIMH website.

Survey: Investors Doubtful About GOP Candidates

   FT. LAUDERDALE, Fla. - (BUSINESS WIRE) - 11/3/2011 - Although many active investors are hopeful the end of 2011 will ultimately deliver a positive return from the stock market, they don’t appear to be banking on any of the Republican presidential candidates for long term economic recovery, according to a recent survey of approximately 240 independent investors conducted by online broker TradeKing.
   When asked which of the seven GOP presidential hopefuls would be the most effective in moving the economy forward, 36 percent of respondents said “none of the above,” with the leading contenders Romney, Paul and Cain garnering percentage points in the teens. Candidate Bachman came in last with less than one percent of responses.
   Overall bullishness rebounded this quarter, up to 33 percent from 15 percent in August, but still well below the high of 51 percent that was reported in January’s survey.
   The in-house survey was conducted October 26-31, 2011 via email to 4,000+ TradeKing clients, with an estimated 95 percent confidence level.
   Key highlights from the October 2011 survey:
Overall Market Sentiment
   Thirty-three percent of investors described themselves as either “bullish” or “very bullish” over the next three months, up from 15 percent in August, but still below the April (41 percent) and January (51 percent) figures.
   Twenty-two percent of investors described themselves as “bearish” or “very bearish,” down sharply from the 41 percent in August, but above the 11 percent in April and six percent in January.
   The remaining 45 percent described themselves as “neutral or not sure” regarding the market’s outlook.
   General optimism around the market’s 2011 performance has increased slightly, as 46 percent of investors polled said they expect the S&P to finish up 5-10 percent by the end of the year, up from 36 percent in August. However, the majority surveyed (51 percent) said the market would finish either flat or down 5-10 percent.
Economic Recovery
   When asked which of the current GOP candidates for president would be most effective in moving the economy forward, 36 percent answered “none of the above.” The candidates receiving the most positive responses were Romney with 16 percent, Paul also with 16 percent and Cain with 14 percent. All other candidates garnered less than 10 percent of responses.
   When asked what would be the most effective catalyst for jump-starting the U.S. economy, respondents put investments in the country’s infrastructure first (43 percent), tax cuts second (29 percent), the passing of the Jobs Bill and mortgage/foreclosure reform third (11 percent each) and more foreign trade fourth (4 percent). Twenty percent answered “other.”
   Unemployment Maintains Top Spot as #1 Trade Trigger; Investors Long on Energy and Technology, Short on Finance and Retail (Still)
   Among those investors surveyed, 43 percent ranked U.S. unemployment claims as their top trade trigger to watch for the next three months, followed by U.S. consumer spending at 39 percent and quarterly earnings results at 37 percent.
   When asked to pick the favored sectors for the next three months from a “long” position, respondents gave energy and technology strong endorsement as the top picks at 49 and 46 percent, respectively. This quarter, respondents once again picked the finance and retail sectors as having the most potential from a “short” position.

Real Estate Investors to Admit To Rigging Bids

   WASHINGTON – 10/27/2011 - Eight Northern California real estate investors have agreed to plead guilty today for their roles in two separate conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in Northern California, the Department of Justice announced.
   Charges were filed on October 27 in U.S. District Court for the Northern District of California in San Francisco against Gary Anderson of Saratoga, Calif.; Patrick Campion of San Francisco; James Doherty of Hillsborough, Calif.; Keith Goodman of San Francisco; Troy Kent of San Mateo, Calif.; Craig Lipton of San Francisco; Henry Pessah of Burlingame, Calif.; and Laith Salma of San Francisco.
   According to the felony charges, the real estate investors participated in a conspiracy to rig bids by agreeing to refrain from bidding against one another at public real estate foreclosure auctions in San Francisco County and San Mateo County. Doherty, Goodman and Lipton participated in the conspiracy in San Francisco, and Anderson, Campion, Kent, Pessah and Salma participated in the conspiracy in San Mateo.
   “The collusion taking place at these auctions allowed the conspirators to line their pockets with funds that otherwise would have gone to lenders and, at times, financially distressed homeowners,” said Sharis Pozen, acting assistant attorney general in charge of the Department of Justice’s Antitrust Division. “The investigation into collusion at these foreclosure auction markets is ongoing, and the Antitrust Division will continue to pursue the perpetrators of these fraudulent schemes until they are brought to justice.”
   The department said that the primary purpose of the conspiracies was to suppress and restrain competition and to conceal payoffs in order to obtain selected real estate offered at San Francisco County and San Mateo County public foreclosure auctions at noncompetitive prices. When real estate properties are sold at these auctions, the proceeds are used to pay off the mortgage and other debt attached to the property, with remaining proceeds, if any, paid to the homeowner.
   According to court documents, the eight real estate investors conspired with others not to bid against one another at public real estate foreclosure auctions in Northern California, participating in a conspiracy for various lengths of time between November 2008 and January 2011. The real estate investors were also charged with conspiracies to use the mail to carry out a fraudulent scheme to make payoffs to obtain title to selected real estate at fraudulently suppressed prices, to receive payoffs and to divert money to co-conspirators and away from mortgage holders and others with a legal interest in these properties.
   Each violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. Each count of conspiracy to commit mail fraud carries a maximum sentence of 30 years in prison and a $1 million fine. The maximum fine for the Sherman Act charges may be increased to twice the gain derived from the crime or twice the loss suffered by the victim if either amount is greater than the $1 million statutory maximum.
   The charges are the latest cases filed by the department in its ongoing investigation into bid rigging and fraud at public real estate foreclosure auctions in San Francisco, San Mateo, Contra Costa and Alameda counties, Calif. To date, as a result of the investigation, 18 individuals have agreed to plead guilty.
   The ongoing investigation into fraud and bid rigging at certain real estate foreclosure auctions in Northern California is being conducted by the Antitrust Division’s San Francisco Office and the FBI’s San Francisco office. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at 415-436-6660, visit or call the FBI tip line at 415-553-7400.
   Source: U.S. Department of Justice release

Fitch: U.S. Residential Construction Still Distressed

   CHICAGO - (BUSINESS WIRE) - 10/20/2011 - Despite recent signs of stabilization in housing starts and new home sales data, Fitch Ratings expects U.S. residential construction activity to remain at distressed levels moving into 2012.
  The September housing starts release by the Commerce Department on October 19 pointed to a modest increase in single-family home starts, but applications for building permits were down slightly versus August, suggesting near-term weakness in new construction activity. The rise in the annualized level of total housing starts to 658,000 in September, up 15 percent from August, reflects some strengthening from this summer's trough, but the biggest driver of monthly gains was a pick-up in multi-family starts, which grew by 51 percent on an annualized basis from August to September.
   Separately, applications for new mortgages declined last week, and the National Association of Homebuilders' confidence index rose but remained at a distressed level. Taken together, recent data provide little support for the view that lower long-term interest rates are driving a material pick-up in the housing market.
   New home demand remains weak in the face of high existing home inventory levels, continuing foreclosure pressure and a persistently weak employment picture. In light of the continuing imbalance in supply and demand, Fitch forecasts very modest growth of approximately 1 percent in U.S. home prices for 2012.
   Although average 30-year mortgage rates have fallen to about 4 percent, near a 40-year low, new home buyer demand is still being depressed by poor jobs growth, tough credit standards applied by lenders and ample availability of competing home inventory.
   Fitch expects new home sales to grow at a rate of 7 percent in 2012, off of a still-depressed 2011 base. Somewhat less competition from distressed home sales, fewer low-cost rental alternatives and historically low interest rates should contribute to the modest rise in single-family home sales next year.

Oil Company Pleads Guilty To Multiple Violations

   WASHINGTON10/16/2011 - Pelican Refining Company LLC, pleaded guilty Oct. 12 to felony violations of the Clean Air Act and to obstruction of justice charges in federal court in Lafayette, La.
   Charges were by announced Stephanie A. Finley, U.S. attorney for the Western District of Louisiana and Ignacia S. Moreno, assistant attorney General of the Environment and Natural Resources Division of the Department of Justice, and Cynthia Giles, assistant administrator for the U.S. Environmental Protection Agency’s Office of Enforcement and Compliance Assurance.
   “Facilities that operate in our backyards have a responsibility to follow our nation's environmental laws, like the Clean Air Act, which is designed to protect the air we breathe and the local environment,”  Giles said. “Today’s guilty plea shows that businesses that choose to ignore these critical safeguards and put their employees and the public at risk will face serious consequences.”
   If the court sentences according to the terms in the plea agreement, Pelican will pay $12 million in criminal penalties, including $2 million in community service payments that will go toward various environmental projects in Louisiana, including air pollution monitoring. It would mark the largest ever criminal fine in Louisiana for violations of the Clean Air Act. Pelican would also be banned from future refinery operations unless and until it implements an environmental compliance plan, which includes external auditing by independent firms and oversight by a court appointed monitor.
   In pleading guilty, officials of Pelican, headquartered in Houston and operating a refinery in Lake Charles, La., admitted that the company had violated numerous aspects of its permit to operate. The violations were discovered during a March 2006 inspection by the Louisiana Department of Environmental Quality (LDEQ) and the Environmental Protection Agency (EPA), which identified numerous unsafe operating conditions. Pelican also pleaded guilty to obstruction of justice for submitting materially false deviation reports to LDEQ, the agency that administers the federal Clean Air Act in Louisiana.
   Pelican has admitted to the following:

   • Pelican had no company budget, no environmental department and no environmental manager;
   • In order to comply with a permit issued under the Clean Air Act, the refinery was required to use certain key pollution prevention equipment, but that equipment was either not functioning, poorly maintained, improperly installed, improperly placed into service and/or improperly calibrated;
   • It was a routine practice for over a year to use an emergency flare gun to re-light the flare tower at the refinery which was designed to burn off toxic gasses and provide for the safe combustion of potentially explosive chemicals; because the pilot light was not functioning properly, employees would take turns trying to shoot the flare gun to relight the explosive gasses;

   • Sour crude oil was stored in a tank that was not properly placed into service and remained in the tank after the roof sank;
   • A caustic scrubber designed to remove hydrogen sulfide from emissions was bypassed; and
   • A continuous emission monitoring system (CEMS) designed to measure the hydrogen sulfide levels in refinery emissions was not working properly.
   Byron Hamilton, the Pelican vice-president who oversaw operations at the Lake Charles refinery since 2005 from an office in Houston pleaded guilty on July 6, 2011, to negligently placing persons in imminent danger of death and serious bodily injury as a result of negligent releases at the refinery. Hamilton faces up to one year in prison and a $200,000 fine for each of the two Clean Air Act counts. 
   The government’s investigation of the Pelican Refinery is continuing. Under the Crime Victims’ Rights Act, crime victims are afforded certain statutory rights, including the opportunity to attend all public hearings and provide input to the prosecution. Any person adversely impacted is encouraged to learn more about the case and the Crime Victims’ Rights Act or you may contact the Victim Witness Coordinator for the U.S. Attorney’s Office, Western District of Louisiana. 
   The criminal investigation is being conducted by the EPA Criminal Investigation Division in Baton Rouge and the Louisiana State Police, with assistance from the Louisiana Department of Environmental Quality. The case is being prosecuted by U.S. Attorney Stephanie Finley, Richard A. Udell, Senior Trial Attorney of the Environmental Crimes Section of the Environment and Natural Resources Division of the U.S. Department of Justice, Trial Attorney Christopher Hale with the Environmental Crimes Section.
   Source: U.S. Environmental Protection Agency

Insider Trading Sentence is Longest in History

   NEW YORK – 11/14/2011 - Raj Rajaratnam was sentenced Oct. 13 in Manhattan federal court to 11 years in prison stemming from his involvement in the largest hedge fund insider trading scheme in history, announced U.S. Attorney for the Southern District of New York Preet Bharara.
   Rajaratnam was the managing member of Galleon Management LLC, the general partner of Galleon Management L.P. and a portfolio manager for Galleon Technology Offshore Ltd. and certain accounts of Galleon Diversified Fund Ltd. He was convicted on May 11 of all 14 counts of conspiracy and securities fraud with which he was charged, following an eight-week jury trial. Rajaratnam was sentenced today by U.S. District Judge Richard J. Holwell. 
   It is the longest sentence imposed for insider trading in history.
   “Two years ago, Raj Rajaratnam stood at the summit of Wall Street, commanding his own financial empire. Then he was arrested, tried and convicted by a jury. Mr. Rajaratnam stood convicted 14 times over of felonies, his empire exposed as a web of fraud and corruption that entangled many,” U.S. Attorney Bharara said. “Today, Mr. Rajaratnam stood once more and faced justice which was meted out to him. It is a sad conclusion to what once seemed to be a glittering story. We can only hope that this case will be the wake-up call we said it should be when Mr. Rajaratnam was arrested. Privileged professionals do not get a free pass to pursue profit through corrupt means. The message is the same for everyone no matter who you are or how much money you have – obey the law or face the fate of those who don’t.”
   According to the superseding indictment filed in Manhattan federal court, other court documents and statements made during related court proceedings:
   From 2003 to March 2009, Rajaratnam repeatedly traded on material, nonpublic information pertaining to upcoming earnings forecasts, mergers, acquisitions and other business combinations. As the evidence at trial showed, the inside information was given as tips by insiders and others at hedge funds, public companies and investor relations firms – including Goldman Sachs, Intel, International Business Machines (IBM) Corporation, McKinsey & Company, Moody’s Investor Services Inc., Market Street Partners, Akamai Technologies Inc. and Polycom Inc. Based on the inside information, Rajaratnam executed trades in the stock of public companies, including Goldman Sachs, Clearwire, Akamai, AMD, Intel, Polycom and PeopleSupport. The court found Rajaratnam earned “well over $50 million” from his illegal trading.
   The evidence at trial included, among other things, recordings of wiretapped phone calls between Rajaratnam and his various co-conspirators, including: Anil Kumar, a former senior partner and director at McKinsey; Rajiv Goel, a former employee of Intel; Adam Smith, a former portfolio manager and analyst at Galleon; and Danielle Chiesi, a former employee of the hedge fund New Castle Partners. Rajaratnam engaged in overlapping conspiracies to commit securities fraud with these individuals, as well as with Mark Kurland, a co-founder at New Castle Partners, Robert Moffat, a former senior vice president at IBM, and Roomy Khan, who traded securities on her own behalf.
   In addition to his prison term, Rajaratnam, 54, of New York was sentenced to two years of supervised release and ordered to pay forfeiture in the amount of $53,816,434 and a $10 million fine. Rajaratnam will surrender to authorities on Nov. 28, 2011.
   During the sentencing proceeding, Judge Holwell said that insider trading “is an assault on our free markets,” and added that “the crimes and scope of the crimes (committed by Rajaratnam) reflect a virus in our business culture that needs to be eradicated.”
  Chiesi, Kurland, Moffat, Kumar, Goel, Smith and Khan have all pleaded guilty to their involvement in the insider trading schemes. Chiesi was sentenced to 30 months in prison, Kurland to 27 months in prison and Moffat to six months in prison. Kumar, Goel, Smith and Khan are awaiting sentencing.
   Bharara praised the investigative work of the FBI and thanked the U.S. Securities and Exchange Commission for its extraordinary assistance.
   The case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Jonathan Streeter and Reed Brodsky, and Special Assistant U.S. Attorney Andrew Michaelson are in charge of the prosecution.

Federal Agency Releases Crime Statistics for 2010

    WASHINGTON, D.C. - 10/11/2011 - According to figures released last month by the FBI, the estimated number of violent crimes in 2010 declined for the fourth consecutive year. Property crimes also decreased, marking this the eighth straight year that the collective estimates for these offenses declined.
   The 2010 statistics show that the estimated volumes of violent and property crimes declined 6.0 percent and 2.7 percent, respectively, when compared with the 2009 estimates. The violent crime rate for the year was 403.6 offenses per 100,000 inhabitants (a 6.5 percent decrease from the 2009 rate), and the property crime rate was 2,941.9 offenses per 100,000 persons (a 3.3 percent decrease from the 2009 figure).
   These and additional data are presented in the 2010 edition of the FBI’s annual report Crime in the United States. This publication is a statistical compilation of offense and arrest data reported by law enforcement agencies voluntarily participating in the FBI’s Uniform Crime Reporting (UCR) program.
   The UCR program collects information on crimes reported by law enforcement agencies regarding the violent crimes of murder and non-negligent manslaughter, forcible rape, robbery, and aggravated assault, as well as the property crimes of burglary, larceny-theft, motor vehicle theft, and arson. (Although the FBI classifies arson as a property crime, it does not estimate arson data because of variations in the level of participation by the reporting agencies. Consequently, arson is not included in the property crime estimate.)
   The program also collects arrest data for the offenses listed above, plus 20 additional offenses that include all other crimes except traffic violations.
   In 2010, there were 18,108 city, county, university and college, state, tribal, and federal agencies that participated in the UCR program. A summary of the statistics reported by these agencies, which are included in Crime in the United States, 2010, follows:
  • Nationwide in 2010, there were an estimated 1,246,248 violent crimes.
  • Each of the four violent crime offenses decreased when compared with the 2009 estimates. Robbery had the largest decrease at 10.0 percent, followed by forcible rape with a 5.0 percent decline, murder and nonnegligent manslaughter with a 4.2 percent decrease, and aggravated assault with a 4.1 percent decline.
  • Nationwide in 2010, there were an estimated 9,082,887 property crimes.
  • Each of the property crime offenses also decreased in 2010 when compared with the 2009 estimates. The largest decline, 7.4 percent, was for motor vehicle thefts. The estimated number of burglaries decreased 2.0 percent, and the estimated number of larceny-thefts declined 2.4 percent.
  • Collectively, victims of property crimes (excluding arson) lost an estimated $15.7 billion in 2010.
  • The FBI estimated that in 2010, agencies nationwide made about 13.1 million arrests, excluding traffic violations.
  • The 2010 arrest rate for violent crimes was 179.2 per 100,000 inhabitants; for property crime, the rate was 538.5 per 100,000 inhabitants.
  • By violent crime offense, the arrest rate for murder and nonnegligent manslaughter was 3.6; forcible rape, 6.5; robbery, 36.6; and aggravated assault, 132.6 arrests per 100,000 inhabitants.
  • By property crime offense, the arrest rate for burglary was 94.3; larceny-theft, 417.5; and motor vehicle theft, 23.1 per 100,000 inhabitants. The arrest rate for arson was 3.7 per 100,000 inhabitants.
  • In 2010, there were 14,744 law enforcement agencies that reported their staffing levels to the FBI. These agencies reported that as of October 31, 2010, they collectively employed 705,009 sworn officers and 308,599 civilians, a rate of 3.5 employees for each 1,000 inhabitants.
   Caution against ranking: Each year when Crime in the United States is published, some entities use the figures to compile rankings of cities and counties. These rough rankings provide no insight into the numerous variables that mold crime in a particular town, city, county, state, tribal area, or region. Consequently, they lead to simplistic and/or incomplete analyses that often create misleading perceptions adversely affecting communities and their residents. Valid assessments are possible only with careful study and analysis of the range of unique conditions affecting each local law enforcement jurisdiction. The data user is, therefore, cautioned against comparing statistical data of individual reporting units from cities, metropolitan areas, states, or colleges or universities solely on the basis of their population coverage or student enrollment.
   Source: FBI release of 9/9/2011

Companies Scramble For Critical-Skill Employees

   NEW YORK - (BUSINESS WIRE) - 10/12/2011 - With the U.S. economy still unsteady, most U.S. companies are finding it relatively easy to attract or retain workers, with one major exception -- critical-skill employees. A new survey from global professional services company Towers Watson (NYSE, NASDAQ: TW) and World at Work, an international association of human resource professionals, shows that for the second consecutive year, the number of U.S. companies having difficulty finding and keeping critical-skill workers has increased.
    The Towers Watson Talent Management and Rewards Survey, a study of 316 North American companies, including 218 from the United States, also found that nearly two-thirds of respondents expect their employees to work more hours now than they did prior to the recession and see this trend continuing for some time. Additionally, respondents are concerned about the impact that organizational changes they made in response to the recession are having in areas such as employees’ work/life balance, productivity and willingness to take risks. Most companies have already made or are planning to make additional changes to their reward and talent management, and other organizational, programs.
    According to the survey, nearly six out of 10 U.S. companies (59%) reported problems attracting critical-skill employees this year. That is an increase from 52% last year and 28% in 2009. Forty-two percent also reported difficulty attracting top-performing employees. Additionally, more than one-third (36%) reported difficulty retaining critical-skill employees, an increase from 31% last year and 16% in 2009. Overall, only one in 10 companies is having difficulty attracting or retaining employees generally.
    “Although economic conditions have improved and hiring rates have increased modestly since 2009, companies are experiencing difficulties finding and recruiting employees with critical skills,” said Laura Sejen, global head of rewards consulting at Towers Watson. “Companies are taking longer to fill these positions, and more of them are open. There is clearly a greater-than-normal mismatch between the skills employers seek and those that are available in the marketplace. In short, despite the overall weakness in the job market, companies need a more appealing offering to attract critical-skill employees.”
Employees Working More Hours
    Nearly two-thirds (65%) of U.S. respondents report that employees have been working more hours over the past three years, and more than half (53%) expect this trend to continue over the next three years. Additionally, about one in three (31%) companies said their employees have been using less of their vacation or personal time off over the past three years.
    The survey also found that more than half (56%) of U.S. companies are concerned about the long-term effects that changes they made during the recession will have on their employees’ ability to maintain a healthy balance between work and their personal lives. And more U.S. employers are becoming concerned about employee productivity (39%) and their employees’ willingness to take risks (37%). As a result, almost two-thirds (66%) of respondents have made significant changes in the HR area -- reward and talent management strategies, organizational structure, job evaluation process and competencies -- and many expect to continue to do so.
   “In the short run, having employees work extra hours can increase productivity, but in the long run, extended hours can negatively affect employee well-being and retention,” said Laurie Bienstock, North America leader of rewards consulting at Towers Watson. “Employees at many organizations are already suffering from change fatigue. As a result, when the labor market does recover, companies can expect a sharp increase in voluntary turnover, especially if they do not address employee concerns, and deliver reward and talent management programs more effectively.”
    “Employees generally don't mind doing more with less especially when economic conditions are tough," said Ryan Johnson, CCP, Vice President of Research for WorldatWork. "But when this drags into multiple years, and they start to hear anecdotes of recovery, they become less understanding. At that point, the entire employee value proposition is crucial to retention."
    Release date: 10/10/2011

Illinois During the Civil War, 1861-1865: Politics During the Civil War

This video concerning the topic of Politics in Illinois and the Union During the Civil War, comes from the "Illinois During the Civil War, 1861-1865" website (, which is a creation of Northern Illinois University Libraries' Digital Initiatives Unit.