October 7, 2024

France Puts UBS Under Investigation for Aiding Tax Evasion

New York — A unit of the Swiss bank UBS has been placed under formal investigation in France following allegations that it designed investments to help its clients evade taxes.

The move comes more than a year after an inquiry was opened regarding the bank’s operations in France, a UBS executive briefed on the matter said Sunday. A handful of UBS executives have been put under investigation since the inquiry began in 2012.

UBS has been dogged for years by regulators who allege that it has helped wealthy individuals dodge taxes, and has successfully settled some of these charges. For instance, the bank agreed to a $780 million fine in 2009 with the U.S. authorities to settle charges that it had helped its American clients to hide funds.

But other countries continue to pursue their own cases against UBS. The executive, who was not authorized to speak on the record, said that while the decision was disappointing for the bank, it was not unexpected.

Several media outlets reported news of the investigation into UBS in recent days.

Tax evasion and avoidance is a hot topic right now as big companies like Apple find themselves denying allegations that they have avoided paying millions of dollars in taxes.

The issue is particularly prickly in France, in part because the country’s former budget minister, Jérôme Cahuzac, admitted to having stashed funds in an undeclared bank account in Switzerland.

The inquiry in France comes as Switzerland puts pressure on its banks to disclose client information, a break from its long-held policy of bank secrecy. In an effort to resolve a continuing dispute with the U.S. authorities over tax evasion by Americans, the Swiss government proposed legislation last week that would provide a legal basis for its banks to cooperate with the U.S. authorities.

Both houses of the Swiss Parliament will consider the legislation during the summer session; if passed, the law would be in effect for a year.

Prosecutors in the United States have opened criminal investigations into about a dozen Swiss and Swiss-style banks involving offshore private banking services that allowed tens of thousands of wealthy Americans to evade U.S. taxes.

The Swiss banks that have been the targets of U.S. investigations include Credit Suisse, which disclosed in July 2011 that it had received a letter saying it was under a grand jury investigation; the Zurich-based Julius Baer; two cantonal, or regional, banks; the Swiss operations of HSBC; and three Israeli banks, Bank Hapoalim, Bank Mizrahi-Tefahot and Bank Leumi.

Julius Baer acknowledged last week that it had received a formal request from the U.S. authorities for data on American clients of the bank’s offshore services.

In 2012, the Justice Department indicted Wegelin Co., Switzerland’s oldest private bank. The bank pleaded guilty to the charges in January, putting it out of business.

Lynnley Browning contributed reporting.

Article source: http://www.nytimes.com/2013/06/03/business/global/03iht-ubs03.html?partner=rss&emc=rss

DealBook: UBS Aided Purchase of Stake in Chinese Insurer

A worker cleans the windows of a building in front of the Ping An Insurance building in Shanghai.Aly Song/ReutersA worker cleans the windows of a building in front of the Ping An Insurance building in Shanghai.

SHANGHAI — The Swiss banking giant UBS made a $5.5 billion loan early this year to help a Thai company acquire a 15.6 percent stake in China’s Ping An Insurance Group, according to people briefed on the deal.

The loan helps explain how the Charoen Pokphand Group, an agribusiness giant based in Thailand, was able to complete one of the biggest deals ever in China, a $9.4 billion acquisition of shares in Ping An. The stake had long been held by the British bank HSBC, which had decided to sell to streamline its businesses.

The loan was crucial, people briefed on the transaction said, because it helped salvage a deal after several media outlets in China reported that the state-run China Development Bank withdrew financing from the Charoen Pokphand Group, also known as the CP Group, shortly before the regulatory deadline early this year.

UBS declined to comment on the loan, the details of which were disclosed earlier by Reuters.

But the people briefed on the deal said UBS had advised the CP Group on its acquisition of Ping An shares, and expected to earn about $100 million for its role in the transaction. These disclosures resolved a mystery of how the CP Group’s stake in Ping An was acquired without loans from the Chinese bank.

Executives at the privately held CP Group, controlled by the Thai billionaire Dhanin Chearavanont, could not be reached for comment. Spokesmen for HSBC and Ping An were also unavailable for comment Friday.

But a person who advised the CP Group said that the company had fully complied with regulations set by the China Insurance Regulatory Commission, which approved the deal.

The deal for Ping An stock was closely followed in Asia after one of China’s leading business publications, Caixin, reported that the CP deal was being financed in part by Chinese investors, Ping An managers and Thaksin Shinawatra, the former prime minister of Thailand.

Analysts consider Ping An one of the best-run Chinese financial firms, with major banking and insurance divisions.

The company was founded in Shenzhen in 1988, and got a lift from Chinese regulators in the late 1990s and early 2000s.

After Ping An’s initial public offering in 2004, the relatives of Wen Jiabao, the former Chinese prime minister, acquired a secret, indirect stake in the company, a stake that at one time was valued at $2.7 billion. Relatives of China’s former Central Bank chief, Dai Xianglong, also acquired an indirect stake in Ping An during the same time.

Mark Scott reported from London.

Article source: http://dealbook.nytimes.com/2013/04/05/ubs-said-to-be-lender-in-9-4-billion-ping-an-deal/?partner=rss&emc=rss

Disruptions: Disruptions: A Fuzzy and Shifting Line Between Hacker and Criminal

The federal government described Daniel Spitler, left, and Aaron Swartz as hackers.left: Bill Kostroun/Associated Press; Noah Berger/Reuters The federal government described Daniel Spitler, left, and Aaron Swartz as hackers.

In January 2011, I was assigned to cover a hearing in Newark, where Daniel Spitler, then 26, stood accused of breaching ATT’s servers and stealing 114,000 e-mail addresses.

Mr. Spitler stood nervously next to armed United States marshals while listening to the judge and prosecutors. I couldn’t help thinking that I could have been the one in front of that judge, labeled a hacker by the Justice Department.

Am I a hacker? No. Not even close. Yet years ago, when I first started learning how to write software code, I dabbled in things that could have been labeled as such by our outdated justice system: downloading free online scripts that could trace people’s whereabouts or scraping Web sites in search of music that didn’t belong to me.

A hacker can be a vandal who renders a Web site inoperable or a thief who profits from stolen passwords and credit card numbers. Mr. Spitler was neither kind. But he was being paraded in front of the world, charged with fraud and conspiracy, and likened, by Paul J. Fishman, the United States attorney for New Jersey, to hackers from LulzSec and Anonymous.

Mr. Spitler told prosecutors that he had tried to notify ATT about the security hole on its site, but after the company did not respond, the e-mail addresses were given to Gawker and other media outlets. He said he did not sell them, or post them online.

“Forty years ago, a hacker was someone who took great joy in knowing everything about computers,” said Susan P. Crawford, a professor at the Benjamin N. Cardozo School of Law at Yeshiva University. “The word was really used in admiration. Now it is used to describe and condemn both professional cyberattackers and amateurs who are swept together within the broad description of the word.”

The same label of hacker was also applied by the Justice Department to Aaron Swartz. Mr. Swartz, a 26-year-old entrepreneur and activist, was set to be charged with wire fraud and computer fraud after he downloaded 4.8 million articles and documents from Jstor, a subscription-only service for distributing scientific and literary journals, because he felt that information should be available to everyone at no cost.

Mr. Swartz could have faced up to 35 years in prison and $1 million in fines, but before the case went to trial, he hanged himself in his Brooklyn apartment. His family issued a statement saying that his death “is the product of a criminal justice system rife with intimidation and prosecutorial overreach.” The United States attorney who was overseeing the case, Carmen Ortiz, said her office’s “conduct was appropriate in bringing and handling this case.”

Both cases are perfect examples of the justice system’s misunderstanding of what a hacker actually is. To many people who understand computers and the law, there is a danger in lumping people who have not sought financial gain with armed robbers. Where people should receive slaps on the wrist, they face decades in prison.

“There’s still uncertainty as to what should be criminal online, and the statutes are pretty vague,” said Orin S. Kerr, a professor of law at George Washington University. “It’s hard because you’ve got conduct that looks bad, and maybe leads to some harm, coupled with vague laws that haven’t properly been clarified by Congress.”

The lack of clarity is something that became all too apparent in Mr. Spitler’s case. When asked by prosecutors why he had hacked the servers, he said he didn’t think he was doing anything illegal. When asked why, he replied, “ ’cause I didn’t hack anything.”

E-mail:bilton@nytimes.com

A version of this article appeared in print on 01/28/2013, on page B4 of the NewYork edition with the headline: A Fuzzy Line Separates Hacker and Criminal.

Article source: http://bits.blogs.nytimes.com/2013/01/27/disruptions-a-fuzzy-and-shifting-line-between-hacker-and-criminal/?partner=rss&emc=rss

The Media Equation: Guns, Maps and Disturbing Data

As a journalist, I am trained as an absolutist in matters of open data. Public records should be just that, public, and as agents of transparency, news media outlets should help cast sunlight on those records. In that context, data is not good or bad, right or wrong; it is information that should be there for the asking, taking or publishing.

That was my initial reflex after The Journal News in Westchester County, N.Y., decided, in the aftermath of the Newtown, Conn., shootings, to publish a map with the names and addresses of people who had applied for handgun permits in two suburban counties. I followed a simple logic: the records were open, the public interest was high and journalism that blends both those things makes sense.

But on reflection, was it really journalism? Not so much. The accompanying article was about whether gun permits should be public, but the newspaper seemed to have all but decided that debate by publishing the map. More problematic was the closeness in time to the Newtown massacre, which served to cast suspicion and guilt in tendentious ways. By dropping the records into the maelstrom of a mass shooting, was The Journal News merely putting data-driven link bait out there?

Publishing is a discrete act, separate from whether something is public or not. Our job as journalists is to draw attention, to point at things, and what we choose to highlight is defined as news. And then it is our job to create context, talk to sources who bring insight and provide analysis. Given that, simply pointing out that something is public as the sole reason for republishing it is not a sufficient justification.

It is one thing to have a public database available that lets me look up whether the neighbor I am feuding with might have a gun permit. It is quite another to publish the names and addresses of all my neighbors who own guns. The decision lacked a rationale. It was what we in the business call “b matter” in search of a lead.

”My first reaction was, why are they doing this? What is the purpose?“ asked Leonard Downie Jr., the former executive editor of The Washington Post who now teaches at Arizona State University’s Walter Cronkite School of Journalism and Mass Communication. “You have to have a very high standard when you publish the addresses of people to begin with, even though those are public.”

(The editor of The Journal News declined any further comment, but the paper’s publisher and president told my colleague Christine Haughney that she supported the publishing of the data.)

But if a public need is not being met, a public appetite certainly is. Newspapers and various Web sites are full of real estate records, crime reports and marriage applications, all of them public, and all of them published with an understanding that we are nosy looky-loos.

Entire print and Web businesses are built on the publication of mug shots, which may be unseemly, but is perfectly legitimate and, speaking from personal experience, very compelling content.

In fact, in trendy journalistic circles, data is all the rage. The last presidential election seemed to be all about the data, with battles breaking out over polls and projections as much as the policy issues. Much of it is exciting and creates transparency, but data needs to be looked after and shaped in the same way that news articles are.

HomicideWatch.org, an independent database of murders in our nation’s capital, has just announced a partnership with The Chicago Sun-Times. This fall, the Knight Foundation, a source of financing for journalistic innovation, put its money behind big data, supporting applications that use data to enhance maps, open up elections and make census results more accessible.

Developers from The Washington Post and The New York Times are working on a crowd-sourced database called Open Elections, intended to create a standardized, linked set of data about elections.

Meanwhile, news organizations are using data to report, to decide which stories to pursue and to discern which areas of coverage are attracting readers. We write stories about Big Brother infiltrating our lives, but sometimes we serve as his wingman.

“Even big, open-sourced data companies like Google make it harder to find your address or your phone number to protect your privacy, to some extent,” said Nate Silver, who runs the FiveThirtyEight blog at The Times. “If something is public in theory, like this database was, it will become public in practice eventually. But I still think that you have to think about the implications and social costs of publication.”

Another thing about data is that it doesn’t necessarily lie, but it doesn’t always tell the truth either. The data on gun permit holders was extracted from various historical records. It was a list of people who had applied for permits at a certain point in time who might or might not have followed up and obtained a gun.

“The United States Census is out of date on April 2, the day after it comes out,” said Matt Waite, a media professor who specializes in data at the University of Nebraska. “People die, people are born, people go to prison, but we still treat it as truth when actually it’s only as true as humans can make it.”

Like a lot of journalism professionals who make a practice of mining data, Mr. Waite said he was concerned that the criticism against The Journal News — there have been threats against people who work there — could actually hurt the cause of free speech, if it prompted officials to close off public records.

It will surprise no one to learn that the response to data disclosure depends a great deal on whose information is being made public. Since its founding more than three years ago, The Texas Tribune, a Web site in Austin, has made a mission of gathering the salary information of every public employee in Texas. That database has been wildly popular.

“From the very first day we started, we have believed in acquiring, cleaning up and presenting public information people need or want to know,” said Evan Smith, chief executive and editor of the site.

He says he gets livid calls from public employees or their spouses several times a week, but that he always reminds them that the benefits of being a public employee come with the knowledge that their salary is a matter of public record. (Mr. Smith’s salary of $315,000 a year is public because “we believe that sunlight and transparency is a great disinfectant.”)

This week, the site — which, speaking of disclosure, has a content partnership with The Times — will use a combination of public statements and its own reporting to publish a data application that will let visitors examine the personal financial interests of the 181 members of the Texas Legislature.

Plenty of people will be peeking in, partly out of prurience, but also because they want to know whose interests are being voted up or down in the coming session.

That exercise sounds very different from plopping a list of possible gun owners on a Web site. We live at a time when data of all kinds can be unleashed with very little friction; part of the value of the news business comes from making sense of it all. When we push the button on something, we expect people to pay attention. We should make sure we are pushing that button for the right reason.

Article source: http://www.nytimes.com/2013/01/14/business/media/guns-maps-and-disturbing-data.html?partner=rss&emc=rss

Media Decoder Blog: McAfee’s Ride With the Press Is Still as Bumpy as Ever

John McAfee on Thursday was photographed in an immigration detention center in Guatemala City, where had access to devices he has used to communicate with the world.Guatemala’s Human Rights Ombudsman’s office, via Associated Press John McAfee on Thursday was photographed in an immigration detention center in Guatemala City, where had access to devices he has used to communicate with the world.

The tumultuous relationship between the technology entrepreneur John McAfee and the reporters who have covered his flight from Belize took another turn on Tuesday, when McAfee announced on his blog that he would no longer cooperate with Vice, the publication that revealed his location when it posted an image embedded with information about where it had been taken.

That location – poolside at the Hotel and Marina Nana Juana in Izabal, Guatemala — made clear that Mr. McAfee had left Belize, where he is wanted for questioning in the death of a neighbor.

Thus Vice becomes the latest example of a publication that was granted access to Mr. McAfee only to have it withdrawn after events didn’t play out as expected. It is a strategy that has helped Mr. McAfee get publicity across a wide array of media outlets, as I wrote in an article that appeared in Monday’s newspaper. But that strategy has also backfired by, among other things, revealing Mr. McAfee’s location to the Guatemalan authorities, who now have him in custody.

McAfee wrote the following on his blog, which he has maintained while being detained in Guatemala on immigration charges: “Due to information just received, it is no longer clear to Mr. McAfee that the ‘accidental’ release of his co-ordinates due to Vice Magazine’s editorial department’s failure to remove location data from their now notorious photo, was indeed an accident. This incident led directly to Mr. McAfee’s arrest.”

The day before, on Monday, I at last spoke on the phone with Rocco Castoro, the Vice editor in chief whom I had written about. Over all, I got the sense that he was still struggling with what to believe in the McAfee case.

While we were chatting, an e-mail popped up in my inbox from none other than John McAfee, who hadn’t responded to my phone calls and e-mails since I published an account of his life in Belize for Gizmodo. The e-mail was addressed to me, but it must have been intended for Rocco. It read:

“Rocco – keep in mind at this point I believe Jeff is working for the lawyers so I am throwing the lawyers off…………”

Who can say what he meant exactly? At any rate, I immediately replied to the e-mail, expressing my delight at hearing from him, and asking if we could talk on the phone. I haven’t heard back.

Article source: http://mediadecoder.blogs.nytimes.com/2012/12/12/mcafees-ride-with-the-press-is-still-as-bumpy-as-ever/?partner=rss&emc=rss

Auditor Finds No Violations In British Newspaper Deal

Under a program, an educational consulting firm had bought 12,000 copies of the paper for 1 euro cent each. Payments were then made to the firm by The Journal through third parties.

The arrangement came to light after the publisher of the European Journal at the time, Andrew Langhoff, resigned last October over what The Journal described as questions of journalistic ethics related to the deal.

The Audit Bureau of Circulations in Britain looked into the matter but said it found no problems. “The payment arrangements underlying this contract were complex and at times circuitous, but A.B.C. has found no clear evidence that these copies should be regarded as not compliant with the reporting standards for international publications,” the audit bureau said.

The audit bureau said, however, that it had begun a separate review of its standards for certain multicopy circulation deals involving international publications “to ensure they fully reflect industry requirements and provide the requisite clarity for all concerned.”

The Journal, which is owned by News Corporation, said it had been “transparent throughout,” noting that the audit bureau signed off on the circulation deal at the time. While denying that the deal was used to artificially inflate sales figures for the European edition of The Journal, the paper discontinued the arrangement last year.

“We have already acknowledged publicly that while the copies were properly counted under A.B.C. rules, the program itself was unnecessarily complex and not one we will replicate in the future,” The Journal said in a statement on Wednesday.

“We appreciate the A.B.C. U.K. putting aside the misleading and sensationalistic press coverage from some media outlets and conducting a thorough and dispassionate review,” the paper added.

The European Journal reported a circulation of a bit less than 75,000 for the first half of last year. Of that total, more than 53,000 represented discounted bulk sales or free copies, which advertisers sometimes consider less valuable than those bought by paying customers.

The audit bureau said its new investigation involved sales deals like The Journal’s former arrangement with the educational consulting firm, in which business customers contract to receive multiple copies to distribute to their employees or other recipients. Other kinds of bulk sales deals, in which newspapers are sold to airlines or hotels, for example, for free distribution to customers, are not under scrutiny, a spokeswoman for the bureau, Isabel Napier-Wilson, said.

Article source: http://feeds.nytimes.com/click.phdo?i=db64f92245e87485e213463ced13fc52

F.C.C. Seeks to Ease Media Ownership Rule

The proposal, which was challenged in court the last time it came up, was the most contentious piece of an updating of the nation’s media ownership rules. Congress requires the F.C.C. to review the rules every four years.

Public interest groups and a departing member of the commission, Michael J. Copps, expressed concerns that the newspaper-broadcast rule change could cause more consolidation in the media industry, in which round after round of stations have been sold to bigger companies.

“In the vast majority of cases, I do not believe that newspaper-broadcast cross-ownership advances the public interest,” Mr. Copps, a Democrat, said in a statement. “It means fewer voices in the community, less localism in the industry and steep transactional costs that all too often lead to down-sized or shuttered newsrooms and fired journalists. Our media, and our public policy, need to head in a different direction.”

The changes to the rule would affect only the 20 most populous markets in the country, where the F.C.C. perceives there to be more competition among media outlets. Commissioner Robert M. McDowell, a Republican, suggested that the rule is outdated at a time when people increasingly get news on the unregulated Internet.

“The notion that broadcasters may distribute their content through radio, television, the Internet, mobile devices and other unforeseen portals, but must be prohibited by law from printing the same content on the medium of newsprint, seems anachronistic at best,” Mr. McDowell said in a statement. He suggested that the newspaper-broadcast rule should be loosened further.

Already, companies can and do seek waivers to own both a newspaper and a station in the same market. The News Corporation, for instance, owns The New York Post and two television stations in the New York City market. Allowing more companies to do so could create new bidders for newspapers, which as a whole have suffered more severely than local TV stations in the last decade.

The F.C.C. proposed to leave most of the other rules about TV and radio station ownership in place with minor modifications. It intends to continue to cap the number of television and radio stations that a company can own in a single market. It does, however, intend to remove a rule about the cross-ownership of television and radio stations.

The commission invited suggestions about how to ensure that stations continue to supply local news. A federal study presented to the F.C.C. this year about the state of the news media found that TV stations have been decreasing their staffs while increasing their volume of news, potentially hindering the quality of that news.

When the F.C.C. suggested a similar loosening of the newspaper-broadcast rule in 2007, public interest groups and others fought the proposal and succeeded in having it thrown out by a federal appeals court. At the time, the court faulted the commission for not giving the public sufficient time to comment on the proposal.

“The F.C.C. should be working to remedy the mistakes of past administrations — not repeating them,” said Craig Aaron, the chief executive of the media reform group Free Press.

He also criticized the commission for, he said, failing to “meaningfully address the issue of ownership diversity.”

Mignon L. Clyburn, a Democratic commissioner, said she desired more data about female and minority ownership of stations.

Mr. Copps said in his statement that “in a country now nearly one third minority, it is shocking, and I think embarrassing, that people of color own barely more than 3 percent of full-power commercial television stations.” He urged the F.C.C. to act quickly to address ownership diversity issues.

Mr. Copps is a staunch advocate for more independent media. “This is the time for citizens far and wide to tell us what they really think and to offer their comments and proposals for an enhanced media,” he said.

Upon Mr. Copps’s departure at the end of the year, the normally five-member F.C.C. will have three members. Meredith Attwell Baker, a Republican commissioner, stepped down in June to become a senior vice president for Comcast. In November, President Obama nominated two replacements, Jessica Rosenworcel, a Democrat, and Ajit Varadaraj Pai, a Republican.

Article source: http://feeds.nytimes.com/click.phdo?i=e57fb97f915334548e1302608b708a1d