The FBI Decided Not To Knock Down a Suspect’s Front Door Because ‘It Was an Affluent Neighborhood’


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The U.S. Court of Appeals for the District of Columbia Circuit heard oral arguments yesterday in United States v. Abou-Khatwa, an insurance fraud case. While most of the argument focused on D.C. insurance broker Tarek Abou-Khatwa’s appeal of his 2019 conviction, toward the end Judge Patricia Millett brought up an aspect of the case that troubled her: When FBI agents served a search warrant at Abou-Khatwa’s home in Kalorama Heights, a swanky D.C. neighborhood “favored by diplomats and power brokers,” there was no answer at the door. But instead of breaching the front door, the agents went around the back to preserve “the aesthetics” of an “affluent neighborhood.”

While that issue was not part of Abou-Khatwa’s appeal, Millett said, “I found this deeply disturbing.” When it became clear that a forced entry was necessary, an FBI agent testified, “the decision was made, since it was an affluent neighborhood,” to do it inconspicuously. “Due to the aesthetics of the neighborhood,” he said, “we decided to use a rear entrance so as to maintain the integrity of the front of the residence.”

Addressing Justice Department attorney Finnuala Tessier, Millett asked, “Are you aware that the FBI has a policy of deciding not to break down the front doors in rich neighborhoods?” Tessier replied that she “was not aware of that.” While “I don’t mean to blindside you,” Millett said, “this is such outrageous behavior by the FBI.” If “there really is a policy out there that in nonaffluent neighborhoods we’ll break down the front door, but for the rich people we’ll go in quietly in the back door,” she said, “that’s deeply troubling,” and “it’s shocking to me that it didn’t get more attention.”

Judge Robert Wilkins thanked Millett for raising the issue. “I was a public defender here for 10 years,” he said. “I can’t tell you how many times my clients had their front doors bashed in. I don’t remember a single time where any agent or police officer was worried about the aesthetics of what their house would look like after they executed a search or arrest.”

When Slate‘s Mark Joseph Stern noted these comments on Twitter, Jabari-Jason Tyson-Phipps, an attorney and former Foreign Service special agent, replied: “I can tell you that is not protocol. The problem is there are two justice systems: 1 for poor people and minorities and 1 for rich people and generally white people. You see it when you are one of the few black agents. Everyone is not equal.”

It’s not clear whether the FBI agents who searched Abou-Khatwa’s house were doing him a favor by eschewing a front-door entry. The agent’s testimony makes it sound as if the main concern was the impact that knocking down Abou-Khatwa’s front door would have on his wealthy neighbors.

Either way, the rationale suggests that people lucky enough to live in places like Kalorama Heights, where the median household income is about $175,000 and nearly three-quarters of the residents are white, but unlucky enough to attract the FBI’s attention can expect better treatment than people who live in, say, Anacostia, where the median household income is about $22,000 and 93 percent of the residents are black. While that would be true regardless of the suspect’s race, such a class-based distinction is apt to have a racially disproportionate impact, as Tyson-Phipps notes.

That point aside, the agent’s concern about neighborhood “aesthetics,” if it reflects a broader practice, means that people who can easily afford to fix the damage caused by an FBI raid are apt to have lower bills than people of modest means who would struggle to cover the expense. It also means that rich people are less likely to be humiliated by a conspicuous front-door entry because it would bother the neighbors.

Tessier, the Justice Department lawyer, did not try to defend the FBI’s wealth-based distinction between criminal suspects. “I will pass that on to my management,” she said. “I understand the court’s concern. I understand why it’s upsetting to the court.”

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It’s Not ‘Bullying’ To Satirize a Student Organization


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When the Young Americans for Freedom (YAF) chapter at the Catholic University of America (CUA) debated the participation of transgender athletes in women’s sports, sophomore Rory O’Connor leaned into the conversation by posting a barrage of critical memes on social media. 

To his surprise, the satirical posts prompted the university to investigate him for “disorderly conduct.”

It all started on March 23 when the school’s YAF chapter posted an image of controversial transgender swimmer Lia Thomas to its Instagram account. The caption read, “Change my mind: Save women’s sports,” inviting critics to stop by the Pryzbyla University Center to debate the issue.

O’Connor only became aware of the event after it had ended, so the next day he took to his Instagram story to passionately express his disagreement with YAF. He launched into a self-described “cyberbullying” campaign against the club consisting of 19 Instagram stories, most of which were popular memes he edited to respond to perceived transphobia on the part of YAF.

In one post, which would eventually become the focal point of the controversy, O’Connor posted a viral meme from the children’s cartoon Arthur which depicts a character holding a baseball bat. He edited the original caption to read “My terms to stop cyber billing [sic] the shit out of @catholicuyaf are simple: Do you wanna keep your post or do you wanna keep your kneecaps?”

In another, he made his opinion on transgender athletes clear: “If you preach love for *all* of God’s children, you better mean all of them—trans and LGBTQ+ people included. And don’t bother anyone with the pseudo-righteous indignation over some memes, for fuck’s sake. Try to give a shit about the lives and experiences of trans people who are hated for nothing but expressing themselves and living in the truth.”

“My intention in making the posts was to criticize and satirize the Catholic U YAF for, what I believe at least, was a blatantly exclusionary and disrespectful event,” O’Connor tells Reason. “I meant this in good humor.” But not everyone saw it as a joke.

Representatives from the YAF chapter filed a complaint to the university, writing to administrators about “a variety of Instagram stories all tagging @catholicuyaf, each of which are misrepresentative of our views, our tabling, and us as individuals.” The complaint alleged harassment, asserting, “A Catholic University student should never threaten, harass, or bully other people including other CUA students.”

In response, the university launched an investigation into O’Connor. In a March 29 letter, administrators notified him of charges of violating the student code of conduct and engaging in “disorderly conduct” due to allegations that he “threatened representatives of Young Americans for Freedom with bodily harm via [his] Instagram post.” He was then summoned to a student conduct conference—potentially facing suspension or expulsion, according to school policy.

That’s when the Foundation for Individual Rights in Education (FIRE) stepped in.

Sabrina Conza, program officer of FIRE’s Individual Rights Defense Program, wrote to Catholic University on April 1, demanding the termination of the investigation. Conza argues that while the Instagram stories were potentially offensive to members and allies of YAF, they are clearly satirical in nature and therefore constitute protected speech.

According to Conza, the memes do not rise to the level of a genuine threat, and, therefore, punishment would violate the university’s guarantee of free speech for students—not to mention its “no cancellation” policy. Although Catholic University is a private institution and therefore not bound by the First Amendment, its institutional commitment to protecting open expression means it is contractually obligated to uphold promises made to students. Furthermore, the letter argues the investigation would run the risk of chilling speech around contentious issues on campus.

“O’Connor’s post uses a well-known meme to criticize YAF’s views on transgender athletes, a topic on which YAF specifically called on students to engage,” Conza tells Reason. “Now that we’ve let the university in on the joke, it must immediately end its investigation and reaffirm its commitment to free speech.”

Catholic University did not respond to a request for comment, but it appears FIRE’s pressure paid off.

At a hearing on Monday, O’Connor was deemed not responsible for the alleged disorderly conduct after YAF members acknowledged that they did not feel physically threatened by the posts. In the end, the Office of Student Conduct & Ethical Development acknowledged O’Connor’s intent was satirical and not genuinely menacing.

O’Connor says he feels “vindicated” by the result. “I’m grateful for the immense help of FIRE,” he says. “This could have ended a lot differently.”

Ultimately, no matter who you side with on the issue of transgender athletes and regardless of whether YAF members were right to be offended, the onus is on administrators to respond appropriately and proportionately. After some pressure from FIRE, Catholic University came out on the side of free speech.

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It’s Not ‘Bullying’ To Satirize a Student Organization


sipaphotosten976610

When the Young Americans for Freedom (YAF) chapter at the Catholic University of America (CUA) debated the participation of transgender athletes in women’s sports, sophomore Rory O’Connor leaned into the conversation by posting a barrage of critical memes on social media. 

To his surprise, the satirical posts prompted the university to investigate him for “disorderly conduct.”

It all started on March 23 when the school’s YAF chapter posted an image of controversial transgender swimmer Lia Thomas to its Instagram account. The caption read, “Change my mind: Save women’s sports,” inviting critics to stop by the Pryzbyla University Center to debate the issue.

O’Connor only became aware of the event after it had ended, so the next day he took to his Instagram story to passionately express his disagreement with YAF. He launched into a self-described “cyberbullying” campaign against the club consisting of 19 Instagram stories, most of which were popular memes he edited to respond to perceived transphobia on the part of YAF.

In one post, which would eventually become the focal point of the controversy, O’Connor posted a viral meme from the children’s cartoon Arthur which depicts a character holding a baseball bat. He edited the original caption to read “My terms to stop cyber billing [sic] the shit out of @catholicuyaf are simple: Do you wanna keep your post or do you wanna keep your kneecaps?”

In another, he made his opinion on transgender athletes clear: “If you preach love for *all* of God’s children, you better mean all of them—trans and LGBTQ+ people included. And don’t bother anyone with the pseudo-righteous indignation over some memes, for fuck’s sake. Try to give a shit about the lives and experiences of trans people who are hated for nothing but expressing themselves and living in the truth.”

“My intention in making the posts was to criticize and satirize the Catholic U YAF for, what I believe at least, was a blatantly exclusionary and disrespectful event,” O’Connor tells Reason. “I meant this in good humor.” But not everyone saw it as a joke.

Representatives from the YAF chapter filed a complaint to the university, writing to administrators about “a variety of Instagram stories all tagging @catholicuyaf, each of which are misrepresentative of our views, our tabling, and us as individuals.” The complaint alleged harassment, asserting, “A Catholic University student should never threaten, harass, or bully other people including other CUA students.”

In response, the university launched an investigation into O’Connor. In a March 29 letter, administrators notified him of charges of violating the student code of conduct and engaging in “disorderly conduct” due to allegations that he “threatened representatives of Young Americans for Freedom with bodily harm via [his] Instagram post.” He was then summoned to a student conduct conference—potentially facing suspension or expulsion, according to school policy.

That’s when the Foundation for Individual Rights in Education (FIRE) stepped in.

Sabrina Conza, program officer of FIRE’s Individual Rights Defense Program, wrote to Catholic University on April 1, demanding the termination of the investigation. Conza argues that while the Instagram stories were potentially offensive to members and allies of YAF, they are clearly satirical in nature and therefore constitute protected speech.

According to Conza, the memes do not rise to the level of a genuine threat, and, therefore, punishment would violate the university’s guarantee of free speech for students—not to mention its “no cancellation” policy. Although Catholic University is a private institution and therefore not bound by the First Amendment, its institutional commitment to protecting open expression means it is contractually obligated to uphold promises made to students. Furthermore, the letter argues the investigation would run the risk of chilling speech around contentious issues on campus.

“O’Connor’s post uses a well-known meme to criticize YAF’s views on transgender athletes, a topic on which YAF specifically called on students to engage,” Conza tells Reason. “Now that we’ve let the university in on the joke, it must immediately end its investigation and reaffirm its commitment to free speech.”

Catholic University did not respond to a request for comment, but it appears FIRE’s pressure paid off.

At a hearing on Monday, O’Connor was deemed not responsible for the alleged disorderly conduct after YAF members acknowledged that they did not feel physically threatened by the posts. In the end, the Office of Student Conduct & Ethical Development acknowledged O’Connor’s intent was satirical and not genuinely menacing.

O’Connor says he feels “vindicated” by the result. “I’m grateful for the immense help of FIRE,” he says. “This could have ended a lot differently.”

Ultimately, no matter who you side with on the issue of transgender athletes and regardless of whether YAF members were right to be offended, the onus is on administrators to respond appropriately and proportionately. After some pressure from FIRE, Catholic University came out on the side of free speech.

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Democrats Block Subpoena For Hunter Biden To Testify Before Congress

Democrats Block Subpoena For Hunter Biden To Testify Before Congress

Authored by Jack Phillips via The Epoch Times (emphasis ours),

Democrats on the House Oversight Committee have blocked a Republican-backed subpoena to compel Hunter Biden to testify as a witness.

Hunter Biden (L) embraces his father, President-elect Joe Biden, in Wilmington, Del., on Nov. 7, 2020. (Andrew Harnik/Pool/AP Photo)

Democrats just denied our motion to subpoena Hunter Biden,” the Republican members of the committee wrote on Twitter.

They refuse to hold Hunter accountable for his shady business dealings that make us more dependent on China for renewable energy. It’s past time for accountability.

Rep. Andy Biggs (R-Ariz.) made a motion to subpoena Hunter Biden, President Joe Biden’s son, as a witness at its hearing about making all U.S. Postal Service (USPS) vehicles electric.

“I just made a motion to subpoena Hunter Biden as a witness for the House Oversight and Reform Committee’s hearing on electrifying [the USPS],” Biggs wrote on Twitter. “Hunter sold a U.S. cobalt mine to a Chinese company. Cobalt is necessary for electric car production. Hunter’s expertise is invaluable!

Last week, House Republicans on the Oversight and Reform Committee called him to testify, according to a letter issued by Rep. James Comer (R-Ky.), and Democrats on the committee blocked a motion to issue a subpoena.

It came as White House press secretary Jen Psaki said on April 5 that Biden has “never spoken” with his son about “his overseas business dealings.”

Recent reports from The Washington Post and other media outlets belatedly verified emails and documents on a laptop that formerly belonged to Hunter Biden. Reports about the younger Biden’s laptop first surfaced in October 2020, with just days to go before the 2020 general election, although big tech firms quickly moved to suppress them.

A November report from The New York Times alleged that Hunter Biden was the part-owner of a venture involved in the $3.8 billion purchase by a Chinese company of one of the largest cobalt deposits in the world. Cobalt is a key component used in electric vehicles and other electronics.

“A lot of stories about Hunter Biden are surfacing this week. So to ensure the independence of the investigation, would the president support the appointment of a special counsel?” Fox News’ Peter Doocy asked Psaki.

“Well first, the president has never had a conversation with the Department of Justice about any investigations into any member of his family,” she said in response to Doocy’s question.

“He said that during the campaign, and he will continue to abide by that. So I point you to the Department of Justice for any additional steps they would take. They would make those decisions independently.”

The U.S. Attorney’s Office in Delaware is investigating Hunter Biden for reported possible tax fraud, lobbying crimes, and money laundering.

Over the past weekend, Biden’s chief of staff, Ron Klain, told ABC News that the president believes Hunter Biden didn’t break the law.

“Of course the president’s confident that his son didn’t break the law. But, most importantly, as I said, that’s a matter that’s going to be decided by the Justice Department, by the legal process. It’s something that no one at the White House has involvement in,” Klain said in response to a question from ABC host George Stephanopoulos.

Hunter Biden didn’t respond to a request for comment by press time.

Tyler Durden
Fri, 04/08/2022 – 14:05

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Morgan Stanley: Into Every Uptick, Institutional Selling Has Been Relentless

Morgan Stanley: Into Every Uptick, Institutional Selling Has Been Relentless

Last weekend, when looking at the latest JPMorgan Prime Brokerage data, we noted that the “pain trade” remains higher as unlike retail, hedge funds have been selling the recent rally aggressively with the largest US bank seeing “net selling in 8 of the past 9 days,” during which stocks have staged a torrid rally.

At the same time, we also observed that the bulk of the recent market meltup has been on the back of a massive short squeeze and covering of puts (creating a delta and gamma squeeze) which makes it especially difficult to predict what happens next as most if not all of the recent market meltup has been due to technicals and positioning, not fundamentals.

We said that “one can conclude that either hedge funds will reverse their selling soon and jump on board the retail buying bandwagon (at which point it will again be time to short), or retail will run out of buying power amid the hedge fund-to-retail “distribution”, and stocks will tumble once again.”

Fast forward one week to today, when… nothing has changed.

In a must-read note from Morgan Stanley Sales and Trading specialist (not for retail distribution just for institutions, and available to ZH pro subs) writes that the sharp reversal higher in the NDX has been brushed off by really everyone as ‘mostly covering’, with ‘some CTA / Systematic buying + Retail’, but ‘nothing real.’ The bank admits that subdued volumes “more or less support this” but it happened nonetheless … and the most ‘real’ part was the narrative shift on the back of it, from ‘Rates shock’ to ‘Growth shock’ (thank you Michael Hartnett) = if the Fed is intent to move quickly and decisively (a Consensus view at this point) then Secular Growth > Cyclical Growth as economic growth slows / falters.

While Morgan Stanley says that that part seems intuitive, “the part that is more confusing is the one where everyone is so sure that every up move needs to be faded.”

At the risk of oversimplifying the situation, we just saw 1Q set up as *the* perfect storm for the doomsday crowd to have their index ‘crash’ scenario play out:

  • Inflation at a 40-year high
  • Hawkish Central Banks (“nine+” hikes)
  • The specter of ‘nuclear war’
  • Ongoing supply chain disruptions
  • Dramatic China slowdown
  • European recession risk
  • Curve inversion signaling
  • Waning fiscal stimulus
  • US Recession / stagflation risk
  • SPX bearish “Death cross”
  • Commodity spike
  • COVID spike
  • VIX spike

Instead, the S&P is now just a few percent off of the highs and the Nasdaq has climbed double digit % since mid-March!

As the bank asks rhetorically, “what happened to it being bullish when bad things happen but the market doesn’t negatively react (further) or, better, it goes up in the face of it?”, although it quickly adds that “in no way does this imply it’s time to chase any / everything.” Instead, it seems reflective of:

  1. how little any of us ever really know / how guessing on the macro is mostly mental gymnastics,
  2. how comfortable we often get in ‘group think’, but also
  3. that often the most important thing you can do in the fog of a macro market is simply to keep your head (avoid emotional extremes in both directions).

Be that as it may, going back to our original point, the meltup – which continues to be catalyzed on the back of relentless retail buying – remains hated by most institutions, and according to Morgan Stanley’s Prime Brokers, “into every uptick during this latest rally that started in late February, institutional selling has been RELENTLESS.”

One potential culprit – as reported over the weekend – was the ongoing liquidation of Softbank’s “Nasdaq Whale”, the SB Northstar unit which was behind the historic August 2020 meltup in stocks when its management team consisting of former Deutsche Bank traders sparked a marketwide gamma squeeze. Well, in an ironic twist, it may very well be the case that the recent crash in tech stocks was the result of Softbank’s unwind.

So whether due to frontrunning of Softbank or for any other reason, Morgan Stanley’s Prime Brokers notes that Hedge Funds sold more longs and added to shorts last week, taking net leverage down 3 points to 45% (just the 14th percentile since 2010), or as the bank puts it, “Pure defense… it’s been a combination of consistent long selling in single names (mostly within TMT):”

… with very little reach for S&P upside.

So what happens next, and what can dent this unprecedented skepticism? 

According to Morgan Stanley, in the near term, “it feels as though market direction will be determined by forced flows from both the active + more model driven community = given current positioning ‘risk’ still seems skewed higher.”

There is much more in the full note available to pro subscribers.

Tyler Durden
Fri, 04/08/2022 – 13:45

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Don’t Blame Big Oil For High Gasoline Prices

Don’t Blame Big Oil For High Gasoline Prices

Authored by Tsvetana Paraskova via OilPrice.com,

  • The single biggest component – out of four – in determining the price of gasoline in America is the price of crude oil on international markets.

  • Sales taxes, along with taxes applied by local and municipal governments, can have a significant impact on the price of gasoline in some locations.

  • Big oil executives rejected claims of price gouging in a congress hearing on Wednesday.

The Biden Administration’s insistence that oil companies are ripping off Americans at the pump while lining their own pockets culminated in this week’s hearing at the House Committee on Energy and Commerce, at which CEOs at the biggest oil corporations in America were grilled about their role in setting the gasoline prices. While Democrats continued to accuse oil companies of price gouging, the top executives of Exxon, Chevron, BP America, Shell USA, Devon Energy, and Pioneer Natural Resources found themselves explaining the basics of economics and how crude oil production and fuel distribution work in a free market.   

Crude Oil Price The Single Most Important Factor In Gasoline Price

The single biggest component—out of four—in determining the price of gasoline in America is the price of crude oil on international markets. In February 2022, the price of crude made up as much as 61 percent of the price American drivers paid for a gallon of regular gasoline, per EIA data. In the decade from 2012 to 2021, crude prices made up 54.8 percent of the price of a gallon of gasoline, EIA data showed.

The other three components influencing the price of gasoline are taxes, refining costs and profits, and distribution and marketing costs and profits.

As of January 1, 2022, total state taxes and fees on gasoline averaged 31.02 cents per gallon. Sales taxes, along with taxes applied by local and municipal governments, can have a significant impact on the price of gasoline in some locations, the EIA says. State taxes also impact gasoline prices, and as the national average price rose above $4 per gallon, some states have moved to temporarily suspend taxes, and others consider doing so to bring relief to American customers, who are very sensitive to gasoline prices and often tie their approval for a president to the price of gasoline they are paying.

Refining costs and profits, as well as distribution and marketing costs, reflect seasonal and local factors, including gasoline demand in peak/off-peak season, the cost of ethanol, the location of the individual gas station, state and local fees, or state regulations on gasoline formulations to reduce air pollution.

Moreover, the biggest oil companies own few of the retail gasoline stations in the United States, and fewer than 40 percent of the country’s 145,000 fueling outlets carry branded fuel of one of the five major oil companies—Exxon, Chevron, Shell, BP, and ConocoPhillips/Phillips 66.

The price of gasoline Americans pay right now is a function of several factors, the biggest of which is the price of crude. Big Oil, or any other oil company operating in a free market such as that of the United States, have very little or nothing to do with how much a gallon of gasoline costs.

“We Do Not Control The Market Price”

“I have seen statements in the press suggesting that Chevron and other oil and gas companies are responsible for the increase in fuel prices. I want to be absolutely clear: we do not control the market price of crude oil or natural gas, nor of refined products like gasoline and diesel fuel, and we have no tolerance for price gouging,” Chevron’s CEO Michael Wirth told the hearing on Wednesday.

House Committee on Energy and Commerce Chairman Frank Pallone, Jr. opened the hearing with, “We are here today to get answers from the Big Oil companies about why they are ripping off the American people.”

Though some 8,000 gas stations around the country bear Chevron brands, the vast majority are privately owned and operated and set their own prices for the fuel they sell to consumers. Chevron owns and operates only about 300 gas stations in three states, Chevron’s Wirth said.

“And while the price of crude oil might dip more quickly, it frequently takes more time for competition among retail stations to bring prices back down at the pump,” he said.

Executives at the other companies present at the hearing shared similar views.

Darren Woods, Exxon’s CEO, said:

No single company sets the price of oil or gasoline. The market establishes the price based on available supply, and the demand for that supply. Continued investment in new production to offset depletion and meet growing demand is the only way to achieve balanced markets and more affordable prices, bringing real relief at the pump.”

Woods also recalled that government policies creating certainty for investments are essential to ensure more supply and bring relief to gasoline prices in the medium term in what appeared a call on the Administration to adopt policies encouraging American oil and gas supply.

“Consistent, efficient, and effective permitting processes, whether for leases, drilling, or infrastructure such as pipelines, or export applications, will help spur further investment in U.S. oil and gas production,” Exxon’s CEO added.

“Pioneer is a “price-taker.” We do not set the sales prices of our products. Rather, our oil and other commodities are sold based on index prices determined by international supply and demand fundamentals and global markets,” Pioneer Natural Resources CEO Scott Sheffield said.

Gretchen Watkins, president of Shell USA, noted that “Because oil is a global commodity, Shell does not set or control the price of crude oil. Similarly, Shell does not set or control the price that consumers pay. Indeed, it would be illegal for Shell to do so because nearly all Shell-branded retail stations in the United States are owned by independent operators who set their own prices in the marketplace.” 

According to NACS, the Association for Convenience & Fuel Retailing, only about 0.1 percent of the fueling outlets in the country are owned by a major oil company. 

“So, when you see announcements about profits or earnings reports of oil companies, don’t confuse them with your local/neighborhood convenience store that’s competing for your business every day to fuel your vehicle,” Jeff Lenard, NACS vice president of strategic industry initiatives, wrote earlier this month.  

Tyler Durden
Fri, 04/08/2022 – 13:24

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Finland Hit With Cyberattacks, Airspace Breach, At Moment Zelensky Addressed Parliament

Finland Hit With Cyberattacks, Airspace Breach, At Moment Zelensky Addressed Parliament

Finland was hit with cyberattacks targeting government sites on Friday just as Ukraine’s President Volodymyr Zelensky was addressing Finnish Parliament. The Ukrainian leader has regularly been giving formal speeches before lawmaking bodies across the West and the world, making urgent please for additional military and humanitarian assistance to his besieged nation.

The attack impacted both the Ministry of Defense’s website and the foreign ministry’s site, the latter which later clarified that it was a denial-of-service attack, noting that the issue has since been resolved.

Via Reuters

The defense ministry earlier issued an urgent tweet saying its website was experiencing and attack and would have to shutter until things were resolved.

The attacks are suspected as coming from Russia, also given reports that a Russian government aircraft may have breached Finnish airspace on Friday, according to Bloomberg.

According to details in Finnish media:

A Russian government fleet aircraft is suspected of violating Finnish airspace in the Gulf of Finland off Porvoo on Friday morning. According to the Ministry of Defense, the suspected airspace violation by a IL-96-300 lasted three minutes.

The ministry’s communications office told Yle that this was the first violation of Finnish territory this year. The most recent previous violation of Finnish airspace by a Russian plane was in July 2020.

Minister of Defense Antti Kaikkonen subsequently stated on Twitter, “Our territorial surveillance capability is good and we detect all territorial violations and are able to respond to them effectively.”

The reported cyberattack had happened as Zelensky addressed Finish lawmakers, condemning atrocities he alleged were intentionally carried out by Russian forces:

All of this is being taken as a ‘message’ from Moscow, also given reports this week that Finland is now mulling applying for NATO membership. Days ago Finland’s Prime Minister Sanna Marin said“Russia is not the neighbor we thought it was,” and called Moscow’s ongoing assault on Ukraine a “flagrant violation”.

A Friday report in Axios suggested that NATO applications from neutral countries Finland and Sweden could be ‘imminent’. 

On Friday during the Ukrainian leader’s virtual address, Finland’s foreign ministry tweeted: “President Zelenskyy gave a historic address to the Parliament today,” and added, “Finland firmly supports Ukraine in its efforts to defend freedom and democracy.”

Tyler Durden
Fri, 04/08/2022 – 13:05

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Former BLM Leader Calls Report On Organization Buying $6 Million Mansion ‘Racist’, ‘Misinformation’

Former BLM Leader Calls Report On Organization Buying $6 Million Mansion ‘Racist’, ‘Misinformation’

Authored by Bill Pan via The Epoch Times (emphasis ours),

Black Lives Matter (BLM) co-founder Patrisse Cullors has spoken against a report that reveals her organization’s purchase of a $5.8 million mansion in southern California, calling the story a “racist and sexist” attack on the movement.

Patrisse Cullors attends an event in West Hollywood, Calif., on Feb. 13, 2020. (Tommaso Boddi/Getty Images for The West Hollywood Edition)

According to the April 4 report by New York Magazine, the 6,500 square-foot California estate was bought in October 2020 using money that had been donated to Black Lives Matter Global Network Foundation, which acts as a fundraising umbrella for BLM activism. It’s unclear who leads the foundation since Cullors stepped down from her position in May 2021 amid criticism over its lack of financial transparency.

The ownership of the house, which comes with “half a dozen bedrooms and bathrooms, several fireplaces, a soundstage, a pool and bungalow, and parking for more than 20 cars,” was transferred to an LLC in Delaware so that the new owner’s identity would not be disclosed, the magazine claimed.

In a statement sent to the magazine on April 1, BLM board member Shalomyah Bowers said that the Foundation had “always planned” to disclose the California house, which they had bought “with the intention for it to serve as housing and studio space for recipients of the Black Joy Creators Fellowship.”

The said fellowship, which “provides recording resources and dedicated space for Black creatives to launch content online and in real life focused on abolition, healing justice, urban agriculture and food justice, pop culture, activism, and politics,” was only announced on April 2, the following morning.

Amid a new round of scrutiny over how BLM spends its donation money, Cullors called the magazine’s mansion story a “despicable abuse of a platform that’s intended to provide information to the public.”

“The fact that a reputable publication would allow a reporter, with a proven and very public bias against me and other Black leaders, to write a piece filled with misinformation, innuendo and incendiary opinions, is disheartening and unacceptable,” she wrote in an Instagram post.

Cullors added that the reason the purchase wasn’t announced was that house required “repairs and renovations” before it could serve as a “safe space for Black people.” She further claimed that she “never misappropriated funds,” although the magazine didn’t accuse her of doing so.

The magazine did claim that the BLM leadership hoped to keep the existence of the house a secret. In a video posted to YouTube in June 2021, however, the property appeared to serve as the backdrop as three then-BLM leaders, namely Cullors, Alicia Garza, and Melina Abdullah, toasted to the 1st-year anniversary of the death of George Floyd.

“For me, the hardest moments have been the right-wing-media machine just leveraging literally all its weight against me, against our movement, against BLM the organization,” Cullors says in the now-deleted video, apparently referring to a New York Post report saying she bought four houses totaling over $3.2 million in predominantly white neighborhoods.

A non-profit and tax-exempt organization, BLM Global Network Foundation has recently found itself caught in a series of compliance issues. According to documents obtained by Washington Examiner, the state of Washington notified the foundation in January 2022 that its state charitable registration had been suspended for failing to provide required records of its financial activities, meaning that the foundation must cease all solicitations in Washington until it is “properly re-registered.”

A similar order was issued in California, where the foundation is based. In the Jan. 31 letter, California’s justice department told the foundation that it is banned from soliciting unless it submits financial records to the state within 60 days. The Department also warned that individuals “responsible for failure to timely file these reports” would be personally liable for all late fees.

Tyler Durden
Fri, 04/08/2022 – 12:48

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Former Goldman Banker Found Guilty Of Fraud And Money Laundering In 1MDB Case

Former Goldman Banker Found Guilty Of Fraud And Money Laundering In 1MDB Case

Paging Lloyd Blankfein (wherever he is)…the relatively junior Goldman Banker Roger Ng, formerly the head of Goldman’s investment banking business in Malaysia, has been found guilty on all three counts following a weeks-long trial at a federal courthouse in Brooklyn. 

Specifically, Ng was charged with two counts of conspiring to violate the Foreign Corrupt Practices Act and one count of conspiring to commit money laundering. 

He now faces up to 30 years in prison at his sentencing, Bloomberg reports.

Ng was found guilty after his former boss, Tim Leissner, struck a deal with prosecutors to turn states’ evidence. Despite a valiant effort by Ng’s defense team, which included exposing Leissner’s neck-deep complicity in the scheme, and his role as the mastermind of the 1MDB bond deals that netted Goldman hundreds of millions of dollars in fees, while seeding 1MDB with billions of dollars – money that was supposed to be used for public works, but was instead siphoned off by former PM Najib Razak and his inner circle (including mastermind Jho Low, who remains a fugitive from justice and is believed to be hiding in China). The money was ultimately used as a political slush fund to buy votes for Razak’s re-election, while Low also stole billions and used it to throw lavish parties, gift celebrities (including model Miranda Kerr) with fabulous jewelry, purchase luxury yachts and real-estate and finance the making of the Martin Scorsese film “The Wolf of Wall Street”.

Roger Ng

During the trial, Leissner (having already pleaded guilty to bribery and corruption charges) appeared as the prosecution’s star witness. He was accused by the defense of being a “double bigamist” (he was allegedly married to two different women at the same time, twice). And he was also exposed for posing as his ex-wife in emails sent to his new wife, Kimora Lee Simons (the ex of Russell Simmons, the founder of Def Jam) to convince her that they were no longer married.

A key element of the FBI’s case was a chart showing that Leissner sent $35 million of the $60 million plus in bribes the banker had received to a shell company controlled by Ng’s wife. The FBI said she later spent $300,000 on diamond jewelry and $20,000 on a gold hourglass. Ng’s wife testified at the trial that the money was actually  proceeds from an investment the couple had made in China, although she failed to produce paperwork to back up this claim.

Nearly two years ago, Goldman admitted that it had conspired to violate anti-bribery laws and its Malaysian unit pleaded guilty to criminal charges – amazingly, that marked the first-ever guilty plea for the firm, which was founded in 1869. The bank paid more than $2.9 billion in fines as a result, the largest penalty of its kind in US history. So far, it has paid more than $5 billion globally for its role in the scheme.

Back in Malaysia, the consequences of the scheme continue to play out. Former PM Razak is free pending appeal, but he has been convicted and could face 12 years in prison if he loses his appeal. Meanwhile, Malaysia’s finance minister said last month that the country is still $4 billion short of the money it needs to repay debts related to 1MDB.

While no senior Goldman executives were implicated in the scheme, Blankfein and former Goldman President Gary Cohn saw some of their bonus money clawed back by the bank (although Cohn successfully withheld some of his money from the claw back). Blankfein reportedly met directly with Low while Goldman was pursuing the deals, despite the multiple red flags raised by the bank’s compliance department, and Ng himself.

Unfortunately, the fact that he had raised concerns about the bond deal wasn’t enough to get him off the hook.

Tyler Durden
Fri, 04/08/2022 – 12:29

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Soaring Inflation Brings $300 Million Profit For Goldman Traders

Soaring Inflation Brings $300 Million Profit For Goldman Traders

In a time when Goldman was aggressively telling its retail clients to come on in, the water is nice and warm, and buy stonks, keeping its 5,100 year-end price target for the S&P (before cutting it to 4,900 and then again to 4,700 as chief strategist David Kostin was “shocked” to learn that the Fed will hike and hike and hike to crush the soon-to-be double digit inflation) even as it was selling billions of stocks for its own account…

… the bank was also taking the other side of its client trade by aggressively capitalizing on inflation – the same inflation that tends to send stocks sharply lower – with Bloomberg reporting this morning that Goldman traders made “hundreds of millions of dollars from inflation trading so far this year”, as the Wall Street giant benefits from the war-fueled surge in European consumer prices which as we reported last week, soared past analysts’ forecasts to 7.5%, the highest year-on-year rate in the history of the single currency. 

According to Bloomberg, Goldman generated about $300 million in the first quarter from dealing in bonds and derivatives tied to inflation, double the same period a year ago, with much of the money made from euro-based transactions, an already-surging market that has jumped to unprecedented levels since Russia’s invasion of Ukraine.

While the post-lockdown, post-Ukraine war surge in consumer prices since last has spawned a global cost-of-living crisis and sent Democrat approval ratings in the trash, it has turned into a goldmine for traders who have correctly predicted the arrival of the highest inflation in decades. Goldman Sachs made about $450 million from the business for all of 2021, double what the firm made in previous years, Bloomberg reported in February. 

As Goldman crushed it on the back of inflation, European households and businesses have been slammed with hikes in energy costs as the Russian invasion roils the continent’s access to oil and gas, worsening a crisis in the cost of commodities that set in last year. The rise in prices has forced governments across the bloc to spend billions of dollars on aid programs, with much of the proceeds ending up indirectly in Putin’s pocket. The European Central Bank may raise interest rates to deal with inflation that’s now more than three times its 2% target. In France, Marine Le Pen has targeted the issue in her campaign to oust President Emmanuel Macron in elections that begin this Sunday.

On the other hand, for Goldman the geopolitical volatility sparked by the ongoing war in Ukraine has meant much more profit, and according to Bloomberg, Nikhil Choraria, who helps oversee the inflation-trading business in London, has thrived by predicting the surge in the continent’s prices.

According to the report, Choraria’s profit has come from derivatives tied to short-term or “front-end” inflation. This market became increasingly volatile during the first quarter as Russian tanks rolled into Ukraine, according to Michael Riddell, who manages about $8 billion at Allianz Global Investors. This kind of uncertainty can make traders a lot of money, he said. Indeed, the cost of options that pay out if inflation climbs above 2% have climbed to previously-unseen levels, generating returns that leave bitcoin in the dust.

“It’s not uncommon for bank trading desks to make money when you have big volatility events, although a few can also lose money too if they get caught on the wrong side,” Riddell said. “Front-end inflation markets were as volatile as it gets.”

Of course, if you can get your own clients to take the other side of the trade – as Goldman did ahead of the credit bubble bursting when it could barely find enough superlatives to describe all those amazing RMBS it was selling – it helps.

Tyler Durden
Fri, 04/08/2022 – 12:25

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