Web Site Stole Job Seekers’ Data in Tax-Fraud Scheme, Manhattan Prosecutor Says

AppId is over the quota
AppId is over the quota
The site, www.jobcentral2.net, listed nonexistent jobs and used applicants’ identities to file the bogus federal tax returns and collect tax refunds, said Cyrus R. Vance Jr., the Manhattan district attorney.

Petr Murmylyuk, 31, a Russian citizen living Brooklyn, preyed upon unemployed people because they were unlikely to have income and unlikely to file a tax return, reducing the chances that the fraudulent returns would draw attention, Mr. Vance said.

“His scheme hurt jobless individuals and society as a whole,” Mr. Vance said.

The ease with which a bogus company can look legitimate on the Internet has created a perfect scenario for fraudulently “phishing” for Social Security numbers and other personal information under various pretenses.

Filing fake tax returns, in particular, is a growing problem. In January, the Internal Revenue Service and the Justice Department announced that a law enforcement sweep through 23 states had revealed the potential theft of thousands of identities and taxpayer refunds.

The I.R.S. has devoted a Web page to listing enforcement actions involving identity thefts used to fraudulently claim tax refunds. In the most recent case, a woman from Monroeville, Ala., who had conspired with a tax return provider to file bogus returns was sentenced to 75 months in prison and ordered to pay more than $1.3 million to the federal government.

The most common form of identity theft complaint received by the Federal Trade Commission’s Consumer Sentinel Network relates to the filing of fraudulent government documents or benefits.

Mr. Murmylyuk’s site claimed that its job placement services were “sponsored by the government and intended for people with low income,” prosecutors said. He sent e-mails with links to his fake Web site through legitimate job search forums and college electronic mailing lists, they said.

He collected refunds in the names of 108 job seekers, an indictment against him said. The amount collected on each was about $3,500 to $6,500, which totaled more than $450,000. Mr. Vance’s office said that money was stolen from the federal government.

Mr. Murmylyuk recruited 11 students from Kazakhstan, who let him use their bank accounts to cash the tax refunds, according to court documents. Some of the students returned to Kazakhstan shortly after opening the accounts for Mr. Murmylyuk, and were indicted in absentia.

Mr. Murmylyuk, also known as Dmitry Tokar, was charged with money laundering, identity theft and other charges. He faces up to 15 years in prison if convicted on the top charge of grand larceny.

Federal prosecutors in New Jersey, meanwhile, charged Mr. Murmylyuk on Tuesday with working with a ring that stole $1 million by hacking into retail brokerage accounts at Scottrade, E*Trade, Fidelity, Schwab and other brokerage firms and executing sham trades.

He was charged with conspiracy to commit wire fraud, unauthorized access to computers and securities fraud. He faces a maximum of five years in prison and a $250,000 fine on the federal charges if convicted.

View the original article here

Peliculas Online

New Treasury Rules Ease Purchase of Annuity With 401(k)

AppId is over the quota
AppId is over the quota
It is one of the biggest conundrums of an aging society: Americans have salted away $11 trillion in retirement plans, yet millions still risk running out of money in old age.

On Thursday the government said it had some new tools to deal with the problem. The Treasury issued several new regulations intended to make it easier, and maybe cheaper, for middle-class people in retirement to transfer the money they accumulated in their 401(k)s into an annuity that would guarantee monthly payments until they die.

“Having the ability to choose from expanded options will help retirees and their families achieve both greater value and security,” said Treasury Secretary Timothy F. Geithner.

The Labor Department also said it had completed rules to let workers learn about the fees various financial firms charge for helping to run 401(k) plans. Labor officials said they thought employers could negotiate better terms if the details were more easily available.

The risk of outliving one’s assets has moved front and center in recent years, as companies have frozen or ended their traditional, defined-benefit pension plans and replaced them with 401(k) plans. Traditional pension plans offer what is, in fact, an annuity, a stream of guaranteed payments from retirement to death. But fewer and fewer employers want to be running an annuity business on the side.

Insurance companies, on the other hand, are eager to wade into what they consider a big and attractive market of graying Americans with I.R.A. and 401(k) balances and little idea of what to do with them. But they have held back, in part, because of tax rules, which Treasury is easing.

One of the changes proposed Thursday would make it easier for employers to work with annuity providers, so that workers can learn about their annuity options at work, rather than having to go to a financial planner or broker.

“I’m trying not to jump up and down in my office, actually,” said Jody Strakosch, national director of annuities for MetLife, who was asked about the new rules while she was reading the 47-page tome from Treasury.

She said MetLife had had suitable annuity contracts available since 2004, but had been selling them mostly to the retail market and not to employers who offer retirement savings plans.

J. Mark Iwry, an official at the Treasury department, said the department hoped in particular to foster a workplace market for “longevity insurance,” something much discussed in policy circles but that employers rarely make available to workers when they retire.

Longevity insurance consists of an annuity whose stream of payments does not start until the retiree is well into retirement — say, 80 or 85 years old. That is the point where policy makers think many will need the money, because they will have exhausted their savings or developed costly health problems. The insurance would kick in and supplement Social Security. Like Social Security, the longevity insurance payments would keep coming every month until the retiree’s death. But because the policy would pay nothing in the first 15 to 20 years of a person’s retirement, it would cost much less than a conventional annuity.

A white paper by the Council of Economic Advisors estimated, for example, that a 65-year-old would have to pay $277,500 for a $20,000-a-year annuity that started immediately, but only $35,200 for one that started at age 85.

With a price so much lower than a conventional annuity, employees would be able to buy longevity insurance to cover their riskiest years with just a portion of their 401(k) account balance.

Most employers that offer annuities give retiring workers an either-or choice: the whole balance as a big check, or the whole thing to buy an annuity. Tax rules make it complicated to calculate the values if the amount is split, so those rules are being relaxed.

When the federal employees’ Thrift Savings Plan let people spend just part of their balance on longevity insurance, there was an increase in participation.

“They found a dramatic pickup in the number of people who were able to take a partial annuity,” said Ms. Strakosch. (MetLife provides the Thrift Savings Plan’s annuities.)

The Treasury also capped the maximum amount of retirement plan money that could be spent on longevity insurance at 25 percent of the account balance, up to $100,000. Mr. Iwry said that would keep high earners from improperly sheltering money, and minimize any effect of the changes on federal tax revenue.

Treasury is also changing the way of calculating required minimum distributions — the amounts that people over 70 are required to withdraw from their 401(k) plans every year. The new method would exclude any money that went to an insurance company to buy longevity insurance or an annuity.

Some of the rules take effect immediately; other changes are in the public comment period.

View the original article here

Peliculas Online

The Cybercrime Wave That Wasn’t

AppId is over the quota
AppId is over the quota
Yet in terms of economics, there’s something very wrong with this picture. Generally the demand for easy money outstrips supply. Is cybercrime an exception? If getting rich were as simple as downloading and running software, wouldn’t more people do it, and thus drive down returns?

We have examined cybercrime from an economics standpoint and found a story at odds with the conventional wisdom. A few criminals do well, but cybercrime is a relentless, low-profit struggle for the majority. Spamming, stealing passwords or pillaging bank accounts might appear a perfect business. Cybercriminals can be thousands of miles from the scene of the crime, they can download everything they need online, and there’s little training or capital outlay required. Almost anyone can do it.

Well, not really. Structurally, the economics of cybercrimes like spam and password-stealing are the same as those of fishing. Economics long ago established that common-access resources make for bad business opportunities. No matter how large the original opportunity, new entrants continue to arrive, driving the average return ever downward. Just as unregulated fish stocks are driven to exhaustion, there is never enough “easy money” to go around.

How do we reconcile this view with stories that cybercrime rivals the global drug trade in size? One recent estimate placed annual direct consumer losses at $114 billion worldwide. It turns out, however, that such widely circulated cybercrime estimates are generated using absurdly bad statistical methods, making them wholly unreliable.

Most cybercrime estimates are based on surveys of consumers and companies. They borrow credibility from election polls, which we have learned to trust. However, when extrapolating from a surveyed group to the overall population, there is an enormous difference between preference questions (which are used in election polls) and numerical questions (as in cybercrime surveys).

For one thing, in numeric surveys, errors are almost always upward: since the amounts of estimated losses must be positive, there’s no limit on the upside, but zero is a hard limit on the downside. As a consequence, respondent errors — or outright lies — cannot be canceled out. Even worse, errors get amplified when researchers scale between the survey group and the overall population.

Suppose we asked 5,000 people to report their cybercrime losses, which we will then extrapolate over a population of 200 million. Every dollar claimed gets multiplied by 40,000. A single individual who falsely claims $25,000 in losses adds a spurious $1 billion to the estimate. And since no one can claim negative losses, the error can’t be canceled.

THE cybercrime surveys we have examined exhibit exactly this pattern of enormous, unverified outliers dominating the data. In some, 90 percent of the estimate appears to come from the answers of one or two individuals. In a 2006 survey of identity theft by the Federal Trade Commission, two respondents gave answers that would have added $37 billion to the estimate, dwarfing that of all other respondents combined.

This is not simply a failure to achieve perfection or a matter of a few percentage points; it is the rule, rather than the exception. Among dozens of surveys, from security vendors, industry analysts and government agencies, we have not found one that appears free of this upward bias. As a result, we have very little idea of the size of cybercrime losses.

A cybercrime where profits are slim and competition is ruthless also offers simple explanations of facts that are otherwise puzzling. Credentials and stolen credit-card numbers are offered for sale at pennies on the dollar for the simple reason that they are hard to monetize. Cybercrime billionaires are hard to locate because there aren’t any. Few people know anyone who has lost substantial money because victims are far rarer than the exaggerated estimates would imply.

Of course, this is not a zero-sum game: the difficulty of getting rich for bad guys doesn’t imply that the consequences are small for good guys. Profit estimates may be enormously exaggerated, but it would be a mistake not to consider cybercrime a serious problem.

Those who’ve had their computers infected with malware or had their e-mail passwords stolen know that cleaning up the mess dwarfs any benefit received by hackers. Many measures that tax the overall population, from baroque password policies to pop-up warnings to “prove you are human” tests, wouldn’t be necessary if cybercriminals weren’t constantly abusing the system.

Still, that doesn’t mean exaggerated loss estimates should be acceptable. Rather, there needs to be a new focus on how consumers and policy makers assess the problem.

The harm experienced by users rather than the (much smaller) gain achieved by hackers is the true measure of the cybercrime problem. Surveys that perpetuate the myth that cybercrime makes for easy money are harmful because they encourage hopeful, if misinformed, new entrants, who generate more harm for users than profit for themselves.

Dinei Florêncio is a researcher and Cormac Herley is a principal researcher at Microsoft Research.

View the original article here

Peliculas Online

CORRECTED-MF Global clients bash fat fees, seek quick wind-down

The remote server returned an unexpected response: (417) Expectation failed.
The remote server returned an unexpected response: (417) Expectation failed.

* Customer group to argue for conversion to Chapter 7 bankruptcy

* Group concerned about mounting fees of trustee Louis Freeh

* Freeh estimates $25 mln in professional fees so far

By Nick Brown

May 17 (Reuters) - The legal team winding down MF Global's bankruptcy estate, led by former FBI director Louis Freeh, estimates the fees charged by the team and other professionals have reached nearly $25 million since the bankruptcy was filed in October.

Now a customer group is planning to ask that the case be streamlined so that those professionals -- especially Freeh -- receive less and customers receive more.

On Friday, a coalition of former MF Global customers plans to argue in U.S. Bankruptcy Court in Manhattan that the Chapter 11 liquidation of the MF parent entity should be converted to a so-called Chapter 7, coalition leader James Koutoulas said on Wednesday.

In Chapter 11 cases, businesses or their court-appointed trustees try to restructure debt or sell assets to recover as much money as possible to pay off creditors, a process that can be drawn out. In Chapter 7, a trustee sells off assets as quickly as possible, with less involvement from professionals like lawyers, but sometimes at the expense of drawing top-shelf value.

Under bankruptcy law, administrative fees are paid ahead of other creditor claims, so Freeh's mounting bills are siphoning money from creditors, said Koutoulas, a Chicago fund manager who had $55 million tied up in MF Global on behalf of his clients.

Freeh has released estimated fee figures but not yet formally submitted compensation requests. The estimates consist of Freeh's fees and those of certain other professionals, including MF Global's creditors' committee, but do not break down who has accrued what.

The effort to curb Freeh's work and convert the proceeding to a Chapter 7 could be a long shot.

Judge Martin Glenn, presiding over the bankruptcy, denied an earlier attempt by another customer group to convert the case, citing potential costs to creditors and the disruption of federal investigations into MF Global's collapse.

But Koutoulas said his group plans to use new legal theories based on information that was not available at the time Glenn made his previous ruling, including that MF Global executives knew at the time of the company's collapse that the company had no viable chance of restructuring.

It is also unclear whether customers like Koutoulas are eligible to share in the proceeds of Freeh's recovery efforts.

MF Global, once led by Jon Corzine, a former Goldman Sachs chief executive and New Jersey governor, filed for bankruptcy on Oct. 31, 2011, after revealing exposure to risky European sovereign debt.

Commodity traders who had personal accounts at the company's broker-dealer unit are waiting to be paid back much of the money they lost when, according to investigators, MF Global improperly commingled customer funds with corporate assets.

Investigators have estimated there could be a roughly $1.6 billion shortfall in customer accounts.

DEADLINE ISSUES

The customer coalition's conversion effort was prompted by Freeh's request earlier this month to extend a Friday deadline to provide data relating to the company's debts, assets, transaction history and personnel.

If granted, it will be the sixth such extension for Freeh, and would stretch the procedure out until June 18. That would allow Freeh's legal team to continue to accrue fees that could otherwise go to creditors, said Koutoulas, who filed court papers asking Judge Glenn to deny the motion.

A person close to Freeh on Wednesday said that despite the extension request, Freeh's team will likely file the data on Friday for five of MF Global's six bankrupt entities. Only its MF Global Holdings USA unit, which did not file for bankruptcy until March, will take longer, said the person.

Freeh's spokeswoman, Diana DeSocio, declined to respond to Koutoulas' criticism. Instead, she pointed to Freeh's written extension request indicating that his team is still waiting on data from MF Global foreign affiliates. Those affiliates, Freeh said in the filing, have been slow to respond since they are winding down their own affairs.

"Although these estates are working diligently to compile information, each has competing duties that occasionally take priority over the gathering and release of information for and to the" MF parent, Freeh said.

A MOOT POINT?

In the unwinding of MF Global, the parent estate is separate from the estate of the broker-dealer, which held customer accounts. Each has its own trustee charged with trying to recover money for its respective creditor groups.

Freeh's job is to recover money for creditors of the MF Global parent. It is unclear exactly how much the parent entity owes, or how much Freeh will be able to recover. For starters, the estate owes about $1.2 billion to a lender group led by JPMorgan Chase & Co, and another $650 million in notes.

Freeh is not in charge of recovering money for customers. That task falls to James Giddens, the trustee for the MF broker-dealer. In theory, then, Freeh's perceived delays have no bearing on the recoveries that customers can obtain.

But some customers have argued they should nonetheless be allowed to recover from the parent because their accounts were improperly tampered with. What's more, Paul Musser, an attorney with Barnes & Thornburg who represents the Commodity Customer Coalition in court proceedings, says his clients have been kept in the dark, making it more difficult for them to navigate the market for their claims.

Customers need as much information as possible about what's going on within the various MF estates so they can make informed decisions on whether to keep or sell their claims, Musser said.

"People are being approached by third parties looking to buy claims, and once you sell, you're giving up rights," he said.

A number of financial firms, including Barclays PLC and the Seaport Group, have begun acquiring claims from customers at a discount in hopes of making a profit through the bankruptcy recovery process.

The bankruptcy is In re MF Global Holdings Ltd, U.S. Bankruptcy Court, Southern District of New York, No. 11-15059

The broker-dealer liquidation is In re MF Global Inc, U.S. Bankruptcy Court, Southern District of New York, No. 11-2790.

View the original article here

Peliculas Online

On Keeping Medical Bills From Hurting Your Credit Score

AppId is over the quota
AppId is over the quota

Paying your medical bills is becoming more complicated, particularly as more patients become responsible for a greater share of their medical costs. And often, hospitals and other providers are turning over bills more quickly to collection agencies.

The problem, as my article on Saturday outlines, is that medical bills can be riddled with errors. Or, it may just take you many months and phone calls to figure out how much you’re really obligated to pay, or why your insurer is dragging its feet. But if you take too long to untangle the mess, it could end up hurting your credit score. If a medical provider hires a collection agency to collect the money on its behalf, credit experts said there’s nothing stopping them from reporting the delinquency to the big credit reporting bureaus. Debt collection experts said that it was ultimately up to the medical provider to determine when the debt got reported.

A consumer has 30 days to dispute the debt (from the time the debt collector initially reaches out to them) with the collector. And if the consumer disputes the cost, the collector is supposed to “cease collection of the debt” until the collector can verify the debt with, say, a copy of a judgment. “That would seem to include notice to the credit bureaus,” said Robert J. Hobbs, deputy director at the National Consumer Law Center and author of “Fair Debt Collection” (National Consumer Law Center, 1987). But “it’s a gray area of whether that is actually a collection effort.”

The Consumer Data Industry Association, a trade group for the big credit bureaus, said that consumers could also request to have the debt deleted from their credit report if the debt was invalid. But as we’ve reported before, disputing errors is not always an easy process.

“You’ve got this mishmash of consumer protection laws that might provide some protection, but aren’t specifically designed to protect consumers against medical billing problems,” said Gerri Detweiler, a credit expert with Credit.com. “We’ve given collection agencies a lot of power to harm consumers’ credit reports due to medical problems, without proper checks and balances.”

The article also discusses legislation that would erase medical debt from credit reports within 45 days of being settled or paid. Supporters of the bill said it would help people whose credit scores were unfairly damaged, while critics argued that it would undermine the value of credit reports because it does not distinguish between people who were truly delinquent and those who were the victims of billing errors or other mistakes.

Has your credit score been damaged by medical bills? What do you think of the legislation? Please share your experience in the comment section below.

View the original article here

Peliculas Online

UPDATE 1-MF Global to get $168 mln back from JPMorgan

The remote server returned an unexpected response: (417) Expectation failed.
The remote server returned an unexpected response: (417) Expectation failed.

* JPMorgan to return "excess collateral" to broker-dealer estate - trustee

* Trustee Giddens says still may have legal claims against JPMorgan

By Nick Brown

NEW YORK, May 18 (Reuters) - JPMorgan Chase & Co, under scrutiny for its ties to collapsed commodities firm MF Global, will return $168 million to the estate of MF's broker-dealer, the estate's trustee announced on Fr iday.

James Giddens, tasked with winding down the estate and recovering as much money as possible for its trader clients who lost money when the firm went bust, said JPMorgan will return "excess collateral" that was held in its estate when the bankruptcy began.

Giddens said the returned funds will help with get money back to customers, but is separate from ongoing discussions with JPMorgan over potential legal claims from Giddens that the bank could be holding customer money.

MF Global declared bankruptcy on Oct. 31. Commodity traders with personal accounts lost millions of dollars when, according to Giddens, the firm improperly used client money to cover corporate transactions as the firm sank.

Giddens has said customer accounts could be short about $1.6 billion.

JPMorgan has retained a security interest in the returned collateral so it can seek to recover it if certain allegedly secured positions in MF Global's capital structure turn out to be uncollateralized, according to Giddens' statement.

JPMorgan was the lead lender on MF Global's $1.2 billion loan, and was also one of its primary clearing banks. Customer advocates, primarily Commodity Customer Coalition leader James Koutoulas, have expressed suspicion that customer money could be at JPMorgan.

A spokeswoman for the bank declined to comment.

KOUTOULAS DEEMED 'FRIVOLOUS'

Separately on Friday, Koutoulas was rebuked by a judge for filing "frivolous" court papers attacking the mounting fees of Louis Freeh, the trustee unwinding the MF Global parent company.

U.S. Bankruptcy Court Judge Martin Glenn rejected arguments from Koutoulas that Freeh should not be allowed to extend a Friday deadline to file financial data about the company. Koutoulas had argued the postponement would allow Freeh, a former FBI director, to rack up unreasonable fees.

Glenn stopped short of granting a request by Freeh's attorney, Brett Miller, to sanction Koutoulas, but warned he may impose such punishments for future frivolous acts.

"Be fair warned," Glenn told Koutoulas, a fund manager and lawyer who has assumed the de facto role of representing MF Global's former customers.

Miller said Freeh planned to file the bulk of the data that sparked the controversy, which lays out information on MF Global's debts, assets, transactional history and personnel, later on Friday.

Koutoulas' fight began when Freeh estimated this week that professionals in MF Global's bankruptcy have accrued nearly $25 million in fees. Freeh's report did not say how much of that figure was accrued by Freeh and his lawyers.

Freeh, who has not yet submitted formal compensation requests, would be paid from money he ultimately recovers on behalf of the MF estate through litigation and other means.

Freeh separately asked the court to extend by one month a Friday deadline to file financial data about the company's debts, assets, transaction history and personnel.

Koutoulas objected that Freeh, who had been granted five similar extensions in the past, acted in bad faith by drawing out his work while continuing to rake in fees.

In bankruptcy, legal fees are paid before other creditor claims, meaning each dollar Freeh accrues is a dollar taken away from creditors, Koutoulas said.

Glenn, though, said Koutoulas did not back up his "bad faith" claims with evidence that Freeh actually had an impure motive for seeking the extension.

There is also the question of whether customers would be eligible to be paid back from money recovered by Freeh. Money he recovers is designed to pay back creditors of MF Global's parent estate, not customers of its broker-dealer unit.

Koutoulas said after the hearing that his group, the Commodity Customer Coalition, will soon file a motion seeking to convert MF Global's bankruptcy from a Chapter 11 to a more streamlined liquidation, known as Chapter 7. The move, he says, would save the estate money.

In Chapter 7, a bankrupt estate is put in the hands of a trustee whose job is to sell assets as quickly as possible and distribute money to creditors.

Koutoulas said he initially planned to make the request at Friday's hearing but after being called "frivolous," the moment didn't seem right.

"The plan was to get that into today's hearing, but I ended up having to be a little more defensive than I thought," he said.

The case is In re MF Global Holdings Ltd, U.S. Bankruptcy Court, Southern District of New York, No. 11-15059.

View the original article here

Peliculas Online

TEXT-Fitch:U.S. high yield default rate to top 2% in May;67% of missed payments lead to bankruptcy

The remote server returned an unexpected response: (417) Expectation failed.
The remote server returned an unexpected response: (417) Expectation failed.

May 18 - The trailing 12-month default rate remained flat in April at 1.9%, according to a new report by Fitch Ratings. The month produced two relatively modest defaults -- Reddy Ice and Dex One -- affecting a combined $537.8 million in bonds.

However, the recent bankruptcy filings by mortgage lender Residential Capital (ResCap) and aircraft maker Hawker Beechcraft add $3.4 billion to the April year-to-date default tally of $5.8 billion. Fitch projects that the U.S. high yield default rate will top 2% in May ? the highest level since October 2010.

The pace of defaults is running ahead of early 2011 activity. The year-to-date defaulted issuer count, including ResCap and Hawker, stands at 16, compared with seven in the first five months of 2011. The par value of bonds affected by defaults is up even more substantially, totaling $9.2 billion thus far versus $1.7 billion in 2011.

As expected, the uptick in defaults is due entirely to stress at the 'CCC' or lower level, where the default rate is tracking at an annualized rate of 10%.

ResCap missed an interest payment roughly a month prior to filing for bankruptcy. This pattern is typical. Since 2000, of the 501 issuers in Fitch's default index who missed interest payments, 67% subsequently filed for bankruptcy. The median time from missed payment to filing was approximately three months. Larger issuers, those with $500 million or more in bonds outstanding, slipped toward bankruptcy even faster ? a median of 45 days.

For additional details please see the full report, 'Fitch U.S. High Yield Default Insight_ April 2012' available at 'www.fitchratings.com'.

View the original article here

Peliculas Online

Variable Annuities Offer Higher Income, at a Cost

AppId is over the quota
AppId is over the quota

Rates on annuities — periodic payments for life by insurance companies to investors who have made regular or lump-sum contributions — are close to the lowest on record, just as bond and bank deposit rates are, financial planners point out.

At first glance, annuity rates do not seem so miserly. A woman, 65 and living in New York, for instance, can receive 7.1 percent a year, according to the Web site ImmediateAnnuities.com. That may sound like a decent amount, but the money used to finance an annuity is forfeited to the insurer, so much of the 7.1 percent amounts to a return of capital.

Investors looking for higher income, or at least the possibility of it, often turn to variable annuities, which invest in mutual funds and provide returns tied to those in financial markets. With stocks showing performance for the last decade that is modest or worse, and often volatile, variable annuities might have lost some appeal, planners say, so insurers have sold versions with enhancements like guaranteed minimum income rates or payments for nursing home stays.

Variable annuities, with or without these so-called riders, could meet the needs of some people in or near retirement, planners contend. They warn, however, that the vehicles tend to be complicated and expensive and may be best avoided.

Variable annuities “offer lots of good funds,” said Christopher Cordaro, chief investment officer of RegentAtlantic Capital in Chatham, N.J., “but they tend to be overloaded with fees and very opaque, so it’s difficult to pull them apart and figure out what you’re paying for.”

Much of the complexity and added cost stem from the riders. A typical income rider might offer the return on a stock index or a fixed percentage, typically 4 or 5 percent these days, whichever is greater — but with an asterisk.

When it comes time to draw income on some of these annuities, Mr. Cordaro cautioned, the amount that the investment would be worth under the guarantee cannot be cashed out or used to buy a fixed annuity at a market rate. It can only be converted to income at rates that would provide a total return, over the life of the annuity, below what would have been available through conventional annuities.

“You can get a stream of income, but not the pot of money they said this grew to be,” he said. “If you really do the math on these, the guarantees aren’t worth what you’re paying for them. Insurance companies tend to make a lot of money off these things.”

Not just on the fancy ones, either. The average bare-bones variable annuity has fees totaling 2.5 percentage points a year, according to Morningstar. (Payment rates quoted by insurance companies and specialist Web sites are net of fees and represent amounts paid to investors.)

John McCarthy at Morningstar says that, on average, 1.5 points of the fees are accounted for by the death benefit that the typical variable annuity calls for if death occurs in the period that contributions are being made. The other point covers the cost of managing the investment funds in the annuity.

Other features mean additional charges. Todd Pack, president of Financial Advisers of America, a firm in Carlsbad, Calif., said that income riders cost 0.6 percentage points and up a year.

There are also annual charges for the bonuses that are often included to persuade investors to transfer from one annuity to another, Mr. Pack noted. He generally considers these bonuses a bad value, and he is no fan of nursing home riders, either.

“They tend to be very restrictive,” he observed. They kick in only after the annuity has been owned for several years, he said, or after the holder has been in a nursing home for many months.

Roman Ciosek, a managing director of HighTower, a Chicago financial advice firm, treats variable annuities with great circumspection, as his peers do, but he considers the rates available in some income riders attractive.

“Because rates are so low” on fixed-rate alternatives, “these annuities are more attractive,” Mr. Ciosek said. He added that he expected insurers to begin lowering rates in income riders, so he advised anyone interested in such an annuity to think about buying it sooner rather than later.

He suggested, however, that investors who would not need their money for at least several years might park it in a retirement account and buy term life insurance. That is a way to obtain the main features of a variable annuity at lower cost and with little added risk, in his view.

Mr. Cordaro recommended keeping a balanced portfolio of stocks and bonds and selling enough stocks each year to buy a no-frills, fixed-rate annuity with 5 percent of total assets. Each one should be with a different insurer because annuities are not federally insured and state authorities provide only limited protection for policyholders, he explained.

This gradual approach will also help avoid investment of a disproportionate amount during periods of very low rates. Because this is one such period, Mr. Cordaro would not be in a hurry to carry out his strategy. “If I knew that interest rates were going up in two or three years, which is probably a good bet,” he said, “I might want to hold off doing it.”

View the original article here

Peliculas Online

Buffett tried to buy ResCap before bankruptcy-report

The remote server returned an unexpected response: (417) Expectation failed.
The remote server returned an unexpected response: (417) Expectation failed.

n">May 17 (Reuters) - Billionaire investor Warren Buffett sought to buy Residential Capital (ResCap) from Ally Financial before the U.S. auto and mortgage lender put its home-lending unit into bankruptcy, Bloomberg said, citing three persons familiar with the matter.

The news agency said Warren Buffett, Berkshire Hathaway Inc's controlling shareholder, appointed investment manager Ted Weschler for talks with Ally, quoting the persons who preferred anonymity.

Under the deal, Berkshire Hathaway would have taken on potential liabilities such as increasing litigation costs and other claims, while paying nothing upfront for ResCap's assets.

Buffett sought to avoid a ResCap bankruptcy filing because Berkshire had unsecured debt in the mortgage unit, the financial website said citing the persons.

Bloomberg's sources said Ally turned down Weschler's deal, and decided to file for bankruptcy instead, to avoid future liabilities.

"We are confident in the bankruptcy court-supervised bidding process, which is designed to ensure that the ResCap estate receives the best possible combination of price and terms for its assets in a court-approved transaction," ResCap spokesperson Susan Fitzpatrick told Reuters in an e-mail.

Residential Capital filed for bankruptcy protection in federal court in Manhattan last week.

At the same time, Nationstar Mortgage Holdings Inc, which is majority-owned by Fortress Investment Group LLC , struck a deal to buy substantially all the mortgage-servicing and related assets from ResCap for about $2.4 billion, including debt.

Ally has been besieged in the past few years by losses at ResCap, once a major subprime lender and profit engine.

Ally could not immediately be reached for comment by Reuters outside regular U.S. business hours. Berkshire, based in Omaha, Nebraska, did not respond to a message seeking comment.

(Reporting by Balaji Sridharan in Bangalore; Editing by Eric Meijer)

View the original article here

Peliculas Online

MF Global trustee recovers $168 mln from JPMorgan

The remote server returned an unexpected response: (417) Expectation failed.
The remote server returned an unexpected response: (417) Expectation failed.

n">May 18 (Reuters) - The trustee for MF Global Holdings Inc's brokerage unit said he has received $168 million in cash from JPMorgan Chase & Co, which had been the commodities and futures brokerage firm's main bank prior to its October bankruptcy.

James Giddens, the trustee for the MF Global Inc unit, said the money represents proceeds of excess collateral that the largest U.S. bank held when the unit began to liquidate.

He said the payment will help his efforts to return money to former MF Global customers, and that he remains in talks with JPMorgan on other claims.

An estimated $1.6 billion of customer funds has disappeared from MF Global, which had been run by Jon Corzine, a former New Jersey governor and senator.

View the original article here

Peliculas Online

Consumer Agency Seems to Soften Limit on Credit Cards Fees

AppId is over the quota
AppId is over the quota
The agency, the Consumer Financial Protection Bureau, introduced a proposal that would make it easier for credit card issuers to charge fees before borrowers’ accounts were officially open.

The bureau, which began overseeing many consumer financial products last year, said it was issuing the proposed rule in response to a federal court decision that challenged how the Credit Card Act was being applied. The act, which took effect in February 2010, put several rules in place aimed at curbing abusive lending practices.

Part of the new law said that credit card issuers could not charge fees equal to more than 25 percent of the borrower’s credit limit in the first year after the account was opened. But after certain credit card issuers started charging application or processing fees before consumers’ accounts were opened, the Federal Reserve expanded the rule so that the fee limit would also apply to those upfront charges. That’s the piece of the rule that the consumer protection agency, which has since assumed regulatory authority, is proposing to eliminate.

The bureau declined to say why it took this course. But some consumer advocates said they believed that the consumer agency, led by Richard Cordray, may be backing down because it has decided to “pick its battles,” while trying to show that it is not unfriendly to business.

But other advocates said they could not understand why the agency was not taking a more aggressive stand. “Even if it is a small rule, it affects the most vulnerable of consumers — consumers with impaired credit records, often of limited means, who end up with these expensive fee-harvester cards,” said Chi Chi Wu, a lawyer at the National Consumer Law Center, referring to cards marketed to people with tarnished credit histories. “Exactly the sort of consumers that we think C.F.P.B. should stand strongest for.”

The bureau’s proposal stems from a ruling in September by the Federal District Court for South Dakota that granted a preliminary injunction blocking the rule on the upfront fees from taking effect. To resolve the matter, the consumer agency said it was seeking comment on whether it should revise the rule so that it no longer applies to fees charged before an account is opened.

The initial lawsuit that led to the federal ruling was brought in July 2011 by First Premier Bank of South Dakota, which issues cards to borrowers with troubled credit records. The bank told the court that it would “suffer irreparable harm” if it were not allowed to collect the upfront fees. “The regulation will threaten First Premier’s very existence by causing the loss of millions of dollars in profits,” the bank said.

It also argued that it is “one of the few businesses in the country that offers such high-risk borrowers the chance to rebuild their credit history.”

A First Premier spokeswoman, Brenda Bethke, said Thursday that the bureau’s proposal is under review by its legal counsel and declined to comment.

Odysseas Papadimitriou, chief executive at CardHub.com, a credit card comparison Web site, said that to his knowledge, First Premier was the only bank that has been trying to make up for revenue that had been crimped by the new credit card regulations by charging more upfront fees. “However, you can count on other banks to start doing the same thing if consumers embrace these high-fee credit cards,” he added. “A smarter strategy for the C.F.P.B. might be to drop the amendment and the associated legal battle but require any issuers that charge fees before the account is opened to send a notice that clearly shows consumers how much their credit card will cost them.”

But some consumer advocates said they still believe that the fees are egregious enough to warrant more of a fight. They said First Premier began charging a $95 processing fee before the card account was opened, as well as a $75 annual fee. Yet the credit limit on the card was $300.

“The C.F.P.B. should not back down in protecting consumers from this sort of chicanery,” Ms. Wu said.

The consumer agency said all comments on its proposal must be received by June 11.

“We welcome and want public feedback on this proposal,” the agency said.

View the original article here

Peliculas Online

Mortgages - Shopping for Loans Online

AppId is over the quota
AppId is over the quota
Peter Carroll, the acting assistant director for mortgage markets at the newly formed Consumer Financial Protection Bureau, suggests that borrowers begin the process by reading the fine print of each site they choose to work with. “Understand the terms of use and privacy policies,” Mr. Carroll said.

If you are shopping for loan rates on sites like Bankrate.com or LendingTree, also be sure to read their “frequently asked questions” section, industry experts say — and recognize, too, that these sites are businesses that make money by working with lenders, via a pay-per-click formula or by generating leads.

If you provide personal information, including your credit score, find out how widely that material will be circulated. As Mr. Carroll put it, “Understand that many lenders may be contacting you.”

At Zillow Mortgage Marketplace, the average number of rate quotes customers receive is 20, while at LendingTree it is 3 to 5, according to both companies.

Most sites provide rates and other information only from lenders that are signed on as their customers. One exception is Bankrate.com, which offers one table that includes its lending clients as well as the five largest banks and other lenders in some 600 local or metropolitan areas.

The online mortgage marketplace has become increasingly popular for borrowers researching loan rates and options. Some 1,200 mortgage-related Web sites are tracked by Experian Hitwise, and the top seven sites drew more than 22 million total domestic visits in April, up 24 percent from a year earlier and 74 percent from April 2010. The numbers are expected to grow with the wider use of smartphones and other devices.

Doug Lebda, the chief executive and founder of LendingTree.com, noted that for the last three years, the difference between the highest and lowest rates available was “wider than it has been in recent history,” making comparison-shopping even more important. But he also pointed out that the advertised rates are “indicative rates but they’re certainly not offers.”

Mr. Lebda suggested that borrowers also consider the mortgage initiation fee and closing costs.

As they navigate through online mortgage sites, borrowers will need to find out the sites’ criteria for matching them up with lenders, and whether lenders can pay for higher placement. That’s where reading the fine print may come in.

“Make sure you feel you’re in control,” said Erin Lantz, the director of Zillow Mortgage Marketplace. That way you can give your personal information out to lenders of your choice.

And if a credit report is pulled by lenders, Mr. Carroll added, find out “what rights do they have to that information besides evaluating that loan request?”

Borrowers will also want to learn about quality control at the sites they visit. Bankrate.com, for example, has a 40-person quality-control department that investigates consumer complaints and does what is known as “mystery shop” on various sites. LendingTree says it relies partly on consumer ratings and reviews, as does Zillow Mortgage Marketplace. It has more than 10,000 reviews to date, Ms. Lantz said, adding that the reviews are also vetted to ensure they are not from any lenders.

Mortgage shopping sites will often advertise that they are making comparisons easier and faster for borrowers, but that could be counterproductive, said Sue Berkowitz, the director of the South Carolina Appleseed Legal Justice Center, which advocates for greater disclosures by these companies. “It should be time-consuming, and done with analysis.”

View the original article here

Peliculas Online

Secret Service Employee’s Plea in Colombia Proved True

AppId is over the quota
AppId is over the quota
The officials determined that a dozen agents and officers had had women in their rooms the previous nights, and they ordered the employees to return to the United States for questioning.

But one employee was particularly adamant that no one else had been in his room the previous night and that he had done nothing wrong.

“He was much more animated than anyone else,” said a government official who has been briefed on the investigation.

Despite the employee’s denials, agency officials did not believe him. The hotel kept records of which guests had had women in their rooms and required the women to leave copies of their identification cards at the front desk before going to a room.

As the employee was preparing to leave the country with the others who had had women in their rooms, the agency officials determined that he had been wrongly accused.

According to a senior American official, the agency has uncovered evidence from the hotel that on the night before, a member of the United States military took a woman back to the hotel and gave the Secret Service employee’s room number at the front desk when a copy of the woman’s identification was made. The member of the military is among the 12 service members under investigation for misconduct with women in Colombia before President Obama arrived. It is unclear whether the member of the military purposely gave the Secret Service employee’s room number or picked it at random.

The agency told the employee that he would remain in the country and be part of the team protecting President Obama.

Meanwhile, the Secret Service has begun to change its policies after the scandal. The agency plans to bar employees from drinking alcohol beginning 10 hours before their shift, the senior American official said. The previous cutoff was six hours.

Another detail about the prostitution case emerged on Thursday. According to a Congressional official, the employees involved included nine Secret Service agents and three uniformed officers. None were part of the president’s personal detail.

View the original article here

Peliculas Online

Mortgages - How to Pump Up Your Credit Score

AppId is over the quota
AppId is over the quota
A majority of banks are less likely to offer loans to people with a FICO credit score of 620 and a 10 percent down payment than they were in 2006, according to the report. Lenders were also less likely to do so even for those with a score of 720.

Such stricter standards have drawn the attention of Ben S. Bernanke, the chairman of the Federal Reserve, who last week told a bankers group that “current standards may be limiting or preventing lending to many creditworthy borrowers.”

For those with lower credit scores, the math is stark: A borrower with a credit score of 720 can expect a rate of 3.70 percent on a 30-year, $300,000 fixed-rate mortgage, according to myfico.com, while someone with a score of 620 to 639 can expect a 5.07 percent rate — or an extra $242 per monthly payment.

“If you don’t have good credit, you’re not going to get that crazy low rate,” said Deborah MacKenzie, the director of counseling at the Housing Development Fund, a nonprofit group in Stamford, Conn. But she and other experts said there were tactics that consumers could use to raise their scores.

First, though, it is worth noting that median credit scores are rising, as people reduce debt and spend less in tight economic times, said Joanne Gaskin, the director of product management and global scoring at FICO, the provider of one of the most popular credit scores used by lenders. Some 18 percent of Americans now have scores of 800 to 850, while 15 percent are below 550, according to FICO data. Through “good behavior,” Ms. Gaskin said, you could raise your credit score by as much as 100 points in a year.

Often lenders will review your scores from the three big credit agencies, and they use the middle number to evaluate you. “That becomes your risk number,” said Tracy Becker, the founder of North Shore Advisory in Tarrytown, N.Y., a national credit score specialist.

Start by obtaining your three credit reports (available free once a year at AnnualCreditReport.com, or call 1-877-322-8228), and study them carefully for errors or omissions. If you think your score labels you as a higher risk, Ms. MacKenzie suggests signing up for a first-time homeowners class through a counseling agency certified by the federal Department of Housing and Urban Development.

According to FICO, the two biggest factors in your credit score are your payment history, which accounts for 35 percent of the score, and the amounts owed, accounting for 30 percent.

Knowing that, Ms. Gaskin said, an effective way to raise your score is to reduce your balances on credit cards. She notes, however, that if an account is in collection, it is too late to improve your credit score by paying it off. The notation that an account is in collection is what lowers the score, she said, so consumers may get more mileage by paying down active credit-card balances and other debts first.

Though mistakes and bankruptcies may stay on your credit report for seven years, lenders will generally be more likely to overlook late payments that happened two or more years ago than more recent ones, Ms. MacKenzie said. “A late payment that occurs this month when you’re applying for a mortgage is deadly,” she said.

Another way to bolster your credit is by asking creditors with whom you have a good track record to report to a credit agency, Ms. Gaskin said. That could include a landlord or a utility.

Improving your credit could take three to four months, or it could take as long as 18 months. “It isn’t an easy fix,” said Carol Yopp, a program manager for the Long Island Housing Partnership and a former mortgage underwriter. “Don’t expect it to happen overnight.”

View the original article here

Peliculas Online

The Post-Cash, Post-Credit-Card Economy

AppId is over the quota
AppId is over the quota
At Home Depot on a purposeful Sunday, you load your cart with lumber and light bulbs and instead of pulling out your wallet, you type in your cellphone number and a PIN. Payment made.

In London, travelers can buy train tickets with their phones — and hold up the phones for the conductor to see. And in Starbucks coffee shops here in the United States, customers can wave their phones in front of the cash register and without even an abracadabra, pay for their soy chai lattes.

Money is not what it used to be, thanks to the Internet. And the pocketbook may soon be destined for the dustbin of history — or at least if some technology companies get their way.

The cellphone increasingly contains the essentials of what we need to make transactions. “Identification, payment and personal items,” as Hal Varian, the chief economist at Google, pointed out in a new survey conducted by the Pew Research Center. “All this will easily fit in your mobile device and will inevitably do so.”

The phone holds and records plenty more vital information: It keeps track of where you are, what you like and who your peers are. That data can all be leveraged to sell you things you never knew you needed.

The survey, released earlier this month by the Pew Research Center’s Internet and American Life Project along with Elon University’s Imagining the Internet Center, asked just over 1,000 technologists and social scientists to opine on the future of the wallet in 2020. Nearly two-thirds agreed that “cash and credit cards will have mostly disappeared” and been replaced with “smart” devices able to carry out a transaction. But a third of the survey respondents countered that consumers would fear for the security of financial transactions over a mobile device and worry about surrendering so much data about their purchasing habits.

Sometimes, those with fewer options are the ones to embrace change the fastest. In Kenya, a service called M-Pesa (pesa is money in Swahili) acts like a banking system for those who may not have a bank account. With a rudimentary cellphone, M-Pesa users can send and receive money through a network of money agents, including cellphone shops. And in India, several phone carriers allow their customers to pay utility bills and transfer small amounts of money to friends and family over their cellphones.

In the United States, several technology companies, big and small, are busy trying to make it easier for us to buy and sell all kinds of things without our wallets. A start-up, WePay, describes itself as a service that allows the smallest merchant — say, a dog walker — to get paid; the company verifies the reputations of payers and sellers by analyzing, among other things, their Facebook accounts. Bill Clerico, its founder, reckoned that in the future, with ever swelling piles of digital data, he could gauge an individual’s credit worthiness or eligibility for a mortgage.

A BRITISH start-up, called Blockchain, offers a free iPhone application allowing customers to use a crypto-currency called bitcoins, which users can mint on their computers.

A company called Square began by offering a small accessory to enable food cart vendors and other small merchants to accept credit cards on phones and iPads. Square’s latest invention allows customers to register an account with Square merchants and pay simply by saying their names. How does the merchant know the customer is who she says she is? With no more than a gaze. The customer’s picture pops up on the merchant’s iPad.

It is still early days for each of these companies, and as the Pew survey suggests, it is difficult to say whether they will gain widespread acceptance or freak people out — or whether, indeed, they will improve our well-being. With so much vital data in our cellphones, what happens when we lose them? Could we one day load up the cellphones of our teenage children with money for cab rides but not beer? Would cash be reserved for purchases of sex, drugs and, in repressive countries, banned books? Or just for people with bad digital reputations?

Perhaps one of the most revealing moments on the road to future money came with the arrival of a mobile payment system Google announced with great fanfare last fall. Google Wallet, as it is called, has been designed to sit in your mobile phone, be linked to your credit card, and let you pay by tapping your phone on a special reader, using what is known as near field technology. But the future, alas, hasn’t come as quickly as Google would like. To date, Google Wallet works on only four kinds of phones, and not many merchants are equipped to accept near field technology.

Meanwhile, PayPal, which allows people to make payments over the Internet, has quietly begun to persuade its users to turn to their cellphones. PayPal posted $118 billion in total transactions last year and became the fastest-growing segment of eBay, its parent company.

“The physical wallet, which had no innovation in the last 50 years, will become an artifact,” John J. Donahoe, the chief executive of eBay, told me recently. The wallet would move into the cloud, and ideally, from his perspective, into PayPal. No more would the consumer worry about losing a wallet, nor about organizing coupons and loyalty cards. Everything, he declared, would be contained within PayPal. It would also enable the company to collect vast amounts of data about customer habits, purchases and budgets.  

PayPal recently rolled out a payment system at 2,000 Home Depot stores nationwide, allowing customers to pay simply by typing in their cellphone numbers, along with a PIN. It plans to install similar kiosks later this year at other chains, including a fast food establishment.

Mr. Donahoe said he wanted his company to become “a mall in your pocket.”

I recently described PayPal’s plans to Alessandro Acquisti, an economist who studies digital privacy at Carnegie Mellon University. Mr. Acquisti smiled. If today all you need to do is enter your phone number and PIN when you visit a store, perhaps tomorrow, he said, that store will be able to detect your phone by its unique identifier as soon as you enter. Perhaps in the not-too-distant future, he went on, you won’t have to shop at all. Your vast piles of shopping data would be instead collected, analyzed and used to tell you exactly what you need: a new motorcycle from Ducati, perhaps, or purple rain boots in the next size for your growing child. Money will be seamlessly taken from your account. A delivery will arrive at your doorstep. “In the future, maybe you won’t have to pay,” Mr. Acquisti offered, only half in jest. “The transaction will be made for you.”

A technology reporter for The New York Times.

This article has been revised to reflect the following correction:

Correction: May 2, 2012

An article on April 19 about the quarterly earnings of eBay misstated the estimated annual transactions of its PayPal online payments unit. PayPal posted about $118 billion in transactions in 2011, not $31 billion. The error was repeated on Sunday in a Sunday Review article about payments by cellphone.

View the original article here

Peliculas Online

REFILE-MF Global clients bash fat fees, seek quick wind-down

The remote server returned an unexpected response: (417) Expectation failed.
The remote server returned an unexpected response: (417) Expectation failed.

* Customer group to argue for conversion to Chapter 7 bankruptcy

* Group concerned about mounting fees of trustee Louis Freeh

* Freeh estimates has accrued $25 mln in fees so far

By Nick Brown

May 17 (Reuters) - The legal team winding down MF Global's bankruptcy estate, led by former FBI director Louis Freeh, has racked up nearly $25 million in estimated fees since its Nov. 25 appointment.

Now a customer group is planning to ask that the case be streamlined so that Freeh and his team receive less and customers receive more.

On Friday, a coalition of former MF Global customers plans to argue in U.S. Bankruptcy Court in Manhattan that the Chapter 11 liquidation of the MF parent entity should be converted to a so-called Chapter 7, coalition leader James Koutoulas said on Wednesday.

In Chapter 11 cases, businesses or their court-appointed trustees try to restructure debt or sell assets to recover as much money as possible to pay off creditors, a process that can be drawn out. In Chapter 7, a trustee sells off assets as quickly as possible, with less involvement from professionals like lawyers, but sometimes at the expense of drawing top-shelf value.

Under bankruptcy law, administrative fees are paid ahead of other creditor claims, so Freeh's mounting bills are siphoning money from creditors, said Koutoulas, a Chicago fund manager who had $55 million tied up in MF Global on behalf of his clients.

Freeh has released estimated fee figures but not yet formally submitted compensation requests.

The effort to curb Freeh's work and convert the proceeding to a Chapter 7 could be a long shot.

Judge Martin Glenn, presiding over the bankruptcy, denied an earlier attempt by another customer group to convert the case, citing potential costs to creditors and the disruption of federal investigations into MF Global's collapse.

But Koutoulas said his group plans to use new legal theories based on information that was not available at the time Glenn made his previous ruling, including that MF Global executives knew at the time of the company's collapse that the company had no viable chance of restructuring.

It is also unclear whether customers like Koutoulas are eligible to share in the proceeds of Freeh's recovery efforts.

MF Global, once led by Jon Corzine, a former Goldman Sachs chief executive and New Jersey governor, filed for bankruptcy on Oct. 31, 2011, after revealing exposure to risky European sovereign debt.

Commodity traders who had personal accounts at the company's broker-dealer unit are waiting to be paid back much of the money they lost when, according to investigators, MF Global improperly commingled customer funds with corporate assets.

Investigators have estimated there could be a roughly $1.6 billion shortfall in customer accounts.

DEADLINE ISSUES

The customer coalition's conversion effort was prompted by Freeh's request earlier this month to extend a Friday deadline to provide data relating to the company's debts, assets, transaction history and personnel.

If granted, it will be the sixth such extension for Freeh, and would stretch the procedure out until June 18. That would allow Freeh's legal team to continue to accrue fees that could otherwise go to creditors, said Koutoulas, who filed court papers asking Judge Glenn to deny the motion.

A person close to Freeh on Wednesday said that despite the extension request, Freeh's team will likely file the data on Friday for five of MF Global's six bankrupt entities. Only its MF Global Holdings USA unit, which did not file for bankruptcy until March, will take longer, said the person.

Freeh's spokeswoman, Diana DeSocio, declined to respond to Koutoulas' criticism. Instead, she pointed to Freeh's written extension request indicating that his team is still waiting on data from MF Global foreign affiliates. Those affiliates, Freeh said in the filing, have been slow to respond since they are winding down their own affairs.

"Although these estates are working diligently to compile information, each has competing duties that occasionally take priority over the gathering and release of information for and to the" MF parent, Freeh said.

A MOOT POINT?

In the unwinding of MF Global, the parent estate is separate from the estate of the broker-dealer, which held customer accounts. Each has its own trustee charged with trying to recover money for its respective creditor groups.

Freeh's job is to recover money for creditors of the MF Global parent. It is unclear exactly how much the parent entity owes, or how much Freeh will be able to recover. For starters, the estate owes about $1.2 billion to a lender group led by JPMorgan Chase & Co, and another $650 million in notes.

Freeh is not in charge of recovering money for customers. That task falls to James Giddens, the trustee for the MF broker-dealer. In theory, then, Freeh's perceived delays have no bearing on the recoveries that customers can obtain.

But some customers have argued they should nonetheless be allowed to recover from the parent because their accounts were improperly tampered with. What's more, Paul Musser, an attorney with Barnes & Thornburg who represents the Commodity Customer Coalition in court proceedings, says his clients have been kept in the dark, making it more difficult for them to navigate the market for their claims.

Customers need as much information as possible about what's going on within the various MF estates so they can make informed decisions on whether to keep or sell their claims, Musser said.

"People are being approached by third parties looking to buy claims, and once you sell, you're giving up rights," he said.

A number of financial firms, including Barclays PLC and the Seaport Group, have begun acquiring claims from customers at a discount in hopes of making a profit through the bankruptcy recovery process.

The bankruptcy is In re MF Global Holdings Ltd, U.S. Bankruptcy Court, Southern District of New York, No. 11-15059

The broker-dealer liquidation is In re MF Global Inc, U.S. Bankruptcy Court, Southern District of New York, No. 11-2790.

View the original article here

Peliculas Online

For 2 Decades, Airport Worker Used Murder Victim's ID, Officials Say

AppId is over the quota
AppId is over the quota

On a July morning in 1992, a man named Jerry Thomas was shot to death in front of the Y.M.C.A. on Parsons Boulevard in Jamaica, Queens. According to the Queen’s district attorney’s office, no one was arrested for his murder.

Almost 20 years later, a security supervisor at Newark Liberty International Airport was arrested on Monday at his home in Elizabeth, N.J., and charged with stealing Mr. Thomas’s identity.

Bimbo Olumuyiwa Oyewole, a 54-year-old illegal immigrant from Nigeria, had been using a birth certificate, Social Security card and other documents indicating that he was Mr. Thomas, said the Port Authority of New York and New Jersey.

In a real-life case reminiscent of Dick-Whitman-as-Don-Draper of “Mad Men,” Mr. Oyewole worked at the airport for various private security companies for almost 20 years under the name Jerry Thomas, the Port Authority said. He had passed multiple background checks, the agency said.

It was not clear how Mr. Oyewole obtained Mr. Thomas’s documents, the authorities said.

An investigation into Mr. Oyewole’s true identity was initiated after the Port Authority’s inspector general received an anonymous tip, a Port Authority spokesman, Steve Coleman, said.

Mr. Oyewole was being held in Essex County Jail on Monday afternoon, awaiting his arraignment, Mr. Coleman said.

View the original article here

Peliculas Online

ID Theft Firms Criticized on 'Free Trial' Policies

AppId is over the quota
AppId is over the quota

A new report on identity-theft protection services says the most frequent complaint from customers concerns misleading trial offers.

Customers sometimes didn’t understand that they would have to pay once the trials ended, the report found, or had trouble reaching the companies to cancel the service.

The Consumer Federation of America, working with commercial providers of identity theft services, last year proposed voluntary “best practices” for the firms to follow in marketing their products. These companies offer a range of services, from credit report monitoring to correcting actual damage caused by an incident of identity theft.

The best practices state, in part, that companies shouldn’t misrepresent their ability to protect consumers from identity theft; that they should have clear, easily accessible privacy policies; and that they clearly explain how the service’s features may help consumers.

The federation recently completed a review of about 20 providers’ Web sites to see how firms were doing in meeting the guidelines a year later.  It found that most of the services’ Web sites did a “fair job” of complying with the guidelines, but there is still “need for improvement,” said Susan Grant, director of the federation’s consumer protection division and leader of the project, in a news release.

The full report looks at the sites and ranks their compliance with each of the voluntary guidelines. The researchers didn’t actually test the services; rather, they tried to gauge how well the companies were doing in providing straightforward information to prospective customers.

If the federation decided the company met the standard, it awarded a “thumbs up” symbol; if it needed some work, it got a hammer; and if it didn’t meet the standard, it got a “thumbs down.”

The report found that some of the sites’ marketing hype remains over the top, and may promise more than the company can deliver. “While these services may alert consumers about possible identity theft quicker than they would discover it themselves,” the report said, “they can’t prevent consumers’ personal information from being stolen or detect identity theft in all circumstances.”

But the most common complaint found during an online search had to with “free trial” offers, an area that wasn’t directly addressed in the original guidelines.

When the federation’s researchers searched online for complaints, looking at sites like ripoffreport.com, it didn’t find much concern about the quality of the identity theft services. (That isn’t surprising, the report said, since “the real test of these services is how well their alert systems and fraud assistance work when consumers become identity theft victims, and many will never experience that situation.”)

Rather, they found complaints about trial offers, in which companies offer their services free for a week or a month, after which customers are charged a fee. Customers often didn’t understand that they had to cancel the service to avoid being charged a fee. And some said they did try to cancel but couldn’t reach a company representative to do so. Still others said they never agreed to try the service in the first place.

The federation recommends that identity theft service providers give customers 48 hours’ notice that a free trial is ending, along with information about how to cancel if they wish and what the terms of the contract will be going forward, if they want to continue using it. And, the federation added, services should provide a quick, easy means of cancellation — “no endless busy signals, no multiple hoops to jump through.”

Have you encountered problems when trying to cancel an identity-theft protection service?

View the original article here

Peliculas Online

Dewey to consider bankruptcy filing - source

The remote server returned an unexpected response: (417) Expectation failed.
The remote server returned an unexpected response: (417) Expectation failed.

* New crop of creditors pressuring Dewey to seek bankruptcy - source

* Creditors are secondary market buyers of Dewey debt

* Dewey had initially sought out-of-court liquidation

By Nick Brown and Nate Raymond

NEW YORK, May 18 (Reuters) - Ailing U.S. law firm Dewey & LeBoeuf is considering a bankruptcy filing as new debtholders take a more aggressive track, shifting away from earlier attempts at an out-of-court liquidation, a person familiar with the matter said on Friday.

The majority of Dewey's partners have quit as a result of concerns about compensation, and $225 million in bank loans and bond debt.

Buyers of distressed debt who have acquired Dewey's debt at a discount on the secondary market are more open to seeing the firm wound down in bankruptcy court rather than out of it, said the person, who requested anonymity because the information was not public.

With the emergence of new creditors, Dewey on Tuesday replaced restructuring adviser Development Specialists Inc. (DSI) with competitor Zolfo Cooper. Joff Mitchell, a senior managing director at Zolfo, is now Dewey's chief restructuring officer, two people familiar with the situation said.

Bill Brandt, chief executive of DSI, confirmed that his firm's involvement in the matter was coming to an end.

"Our firm is transitioning out," Brandt said. "We've been replaced by Zolfo at the insistence of the debt holders. It now becomes a creditor-driven case."

A bankruptcy filing is not certain, and the timing of any potential filing remains unclear. The firm has been consulting with restructuring lawyers since April at the latest, and has retained bankruptcy attorney Albert Togut of law firm Togut Segal & Segal.

Neither Stephen Horvath III, Dewey's executive partner, nor Janis Meyer, its general counsel, responded to requests for comment. Mitchell and a spokesperson for Zolfo also did not respond to requests for comment.

Togut did not respond to a request for comment on Friday.

A spokesman for the firm's primary bank lender, JPMorgan Chase & Co, declined to comment late on Friday.

Once one of the largest law firms in the United States, Dewey & LeBoeuf has lost all but a handful of the 300 partners with which it opened 2012. It has laid off 433 of 533 employees in New York, according to the New York State Labor Department.

Dewey's debtholders have been selling their stakes during the firm's downfall. As of May 3, bankruptcy analyst Kevin Starke of CRT Capital Group said Dewey's $150 million in notes privately placed following a 2010 bond offering were trading at between 45 cents and 55 cents on the dollar on the secondary market.

The shift toward a possible bankruptcy filing would be a major change in direction. As recently as March 12, Martin Bienenstock, formerly a top bankruptcy partner at Dewey and an outgoing member of the firm's office of the chairman, told the Wall Street Journal that the firm had "no plan to file a Chapter 11 bankruptcy."

"We've had a completely non-adversarial relationship with our lenders, and right now the cash we're using is the lender's collateral," he said at the time.

Bienenstock did not respond to a request for comment late on Friday. He was one of four members of Dewey's top management team, the office of the chairman, to decamp to other firms in recent days, joining Proskauer Rose. The last member of that office, Washington, D.C., lobbyist L. Charles Landgraf, said he had joined Arnold & Porter on Wednesday.

Lawsuits are mounting against Dewey. The U.S. Pension Benefit Guaranty Corporation sued the firm Monday in Manhattan federal district court in order to take control of three of the firm's pension plans, which the agency said were underfunded by $80 million.

Bankruptcies are often driven by creditors. On Wednesday, Annette Jarvis of Dorsey & Whitney, a bankruptcy lawyer who represents a group of 51 retired pension partners at Dewey predecessor LeBoeuf Lamb Greene & MacRae, said that in her view the firm "has to be put into a bankruptcy."

Jarvis did not respond to a request for comment on Friday.

View the original article here

Peliculas Online

Lenders Returning to the Lucrative Subprime Market

AppId is over the quota
AppId is over the quota
“Even I wouldn’t make a loan to me at this point,” Ms. Alejandro said.

In the depths of the financial crisis, borrowers with tarnished credit like Ms. Alejandro were almost entirely shut out by traditional lenders. It was hard enough for people with stellar credit to get loans.

But as financial institutions recover from the losses on loans made to troubled borrowers, some of the largest lenders to the less than creditworthy, including Capital One and GM Financial, are trying to woo them back, while HSBC and JPMorgan Chase are among those tiptoeing again into subprime lending.

Credit card lenders gave out 1.1 million new cards to borrowers with damaged credit in December, up 12.3 percent from the same month a year earlier, according to Equifax’s credit trends report released in March. These borrowers accounted for 23 percent of new auto loans in the fourth quarter of 2011, up from 17 percent in the same period of 2009, Experian, a credit scoring firm, said.

Consumer advocates and lawyers worry that the financial institutions are again preying on the most vulnerable and least financially sophisticated borrowers, who are often willing to take out credit at any cost.

“These people are addicted to credit, and banks are pushing it,” said Charles Juntikka, a bankruptcy lawyer in Manhattan.

The banks, for their part, are looking to make up the billions in fee income wiped out by regulations enacted after the financial crisis by focusing on two parts of their business — the high and the low ends — industry consultants say. Subprime borrowers typically pay high interest rates, up to 29 percent, and often rack up fees for late payments.

Some former banking regulators said they worried that this kind of lending, even in its early stages, signaled a potentially dangerous return to the same risky lending that helped fuel the credit crisis.

“It’s clear that we are returning to business as usual,” said Mark T. Williams, a former Federal Reserve bank examiner.

The lenders argue that they have learned their lesson and are distinguishing between chronic deadbeats and what some in the industry call “fallen angels,” those who had good payment histories before falling behind as the economy foundered.

A spokesman for Chase, Steve O’Halloran, said the bank “seeks to be a careful, responsible lender,” adding that it “is constantly evaluating the risks and costs of funding loans.”

Regulators with the Office of the Comptroller of the Currency, which oversees the nation’s largest banks, said that as long as lenders adhered to strict underwriting standards and monitored risk, there was nothing inherently dangerous about extending credit to a wider swath of people.

In fact, an increase in lending is a sign that the economy is improving, economists say. While unemployment remains high, consumers have been reducing their debts. Delinquencies on credit card accounts and auto loans are down sharply from their heights in the crisis. “This is a natural loosening of credit standards because the banks feel they can expand again,” said Michael Binz, a managing director at Standard & Poor’s.

And lenders miss many potential customers if they focus just on people with perfect credit.

 “You can’t simply ignore this segment anymore,” said Deron Weston, a principal in Deloitte’s banking practice.

The definition of subprime borrowers varies, but is generally considered those with credit scores of 660 and below.

The push for subprime borrowers has not extended to the mortgage market, which remains closed to all but the most creditworthy.

Capital One is one lender that has been courting borrowers with damaged credit, even those who have just emerged from bankruptcy, with pitches like, “We want to win you back as a customer.”

Pam Girardo, a spokeswoman for Capital One, said, “Our strategy is to provide reasonable access to credit with appropriate guardrails in place to ensure consumers stay on track as they rebuild their credit.”

Ms. Alejandro, 46, was one of the borrowers fresh out of bankruptcy courted by Capital One. So far, she has turned it down.

View the original article here

Peliculas Online

A Look at Why Consumers Are Using Prepaid Debit Cards

AppId is over the quota
AppId is over the quota

It’s clear that prepaid debit cards — cards that you load with cash, spend down and then reload — are hot.

In 2009, consumers loaded roughly $29 billion on such cards, which are especially popular with young adults and those considered underbanked — meaning they have little access to mainstream financial institutions like banks. But by next year, that amount is expected to reach $202 billion, according to an estimate cited in a report from an arm of the Pew Charitable Trusts. Even the budgeting guru Suze Orman is marketing a prepaid card.

So to gain insight into why consumers are using the cards, researchers from Pew’s Safe Checking in the Electronic Age project convened focus groups last fall in Houston and Chicago.

The project recently released some of its findings, along with excerpts from the comments made by participants in the focus groups. The gist of the findings is that users do not like some of the fees associated with prepaid cards, but seem to prefer them over higher and, from their perspective, less predictable fees that come along with traditional checking accounts.

Some of the comments are not only enlightening but also fun to read, so I decided to share some here. (You can read more in the full report).

Here’s one of my favorites, in which a Chicago woman re-enacts a telephone call she made to the customer service number for her prepaid card to question a charge — only to learn that she was being charged for the inquiry. (The card brand isn’t identified.)

Participant: “It was like, ‘Ma’am, you get charged for calling customer service.’ ‘I’m getting charged now for calling you all about the money that I got charged?’ She was like, ‘Yes, I’m sorry.’ I was like, ‘The next time I load my card, I have to pay for the fees that you charge me for talking to you right now?’ ‘Yes.’ ‘O.K. ’Bye.’”

Yet participants seemed to prefer the fees associated with prepaid cards, which Houston participants described as more transparent, to charges like overdraft fees that can come into play with checking accounts at banks.

Male Participant: “Compared to my situation, I went through a lot of late fees with the credit cards, extra fees with the checking accounts. I was paying monthly between $35 to $50 in fees compared to $3.99 that I pay for a maintenance fee to get a card.”

Female Participant, on the prepaid card fees: “I think they are fair because they’re upfront. I’m thinking in contrast to a checking account. I think the ambiance and the idea of the marketing behind a checking account is they’re your friend; they’re your hometown bank. You can depend on them. You can count on them and, really, they’re just lulling you into the sense of comfort because they’re going to whammy you with fees on the backside. Whereas prepaid debit cards, they’re very upfront. This is the cost of the card; this is the cost for the services. It’s up to you at that point.”

Several participants seemed uneasy about the notion of adding credit options to prepaid cards, since they see a major benefit of the cards as helping them stick to a budget and avoid overspending.

Female Participant (Chicago): “It defeats the purpose of a prepaid debit card because it is, like, it’s a credit card. You can use money that you really don’t have to pay back, and I wouldn’t want to do that because I know I’m just going to get myself in some trouble.”

Have you used prepaid debit cards? Are the fees charged for them worth it for the service the cards offer?

View the original article here

Peliculas Online

When the Wait for Social Security Checks Is Worth It

AppId is over the quota
AppId is over the quota

This description oversimplifies things, of course. Social Security, as it’s currently constituted, is refreshingly straightforward but you do have to make one important choice, and many people could make their lives after retirement better if they chose differently.

As I discussed in a previous column, most economists and financial advisers say that in retirement, Americans would do well to increase the proportion of their wealth that pays a guaranteed income for life, much as Social Security does. The technical word for the financial instrument that accomplishes this feat is an annuity.

Traditional pensions are a form of annuity, and people who have them usually seem to love them. What’s odd is that people with retirement plans like 401(k)’s generally do not buy annuities, even though annuities would simplify and stabilize their financial lives. Economists call this state of affairs the annuity puzzle.

Several readers wrote to explain why they did not own (or recommend) annuities. Three major worries stood out:

¶Most annuities are not inflation protected, so what happens if high inflation returns?

¶How can a buyer be sure that the company selling the annuity will be able to make the payments 20 or 30 years from now?

¶Annuities can be complicated and are sometimes sold with large fees. How can buyers know whether they are getting a good deal?

All of these concerns are legitimate. I wish I had found a simple recipe to solve all of these problems, but they are tough ones. Still, the federal government could help matters. For example, it might create rules to encourage more employers to offer safe and fairly priced annuities within their 401(k) plans. There is interest in Washington in doing this, but the details are tricky. Employers would like a clear-cut rule absolving them from the responsibility of choosing an annuity provider, say, by granting a safe harbor if the insurance company has a satisfactory credit rating, but given the recent track record of rating agencies, this particular rule is unlikely to be adopted.

In light of these difficulties, let’s focus on the one source of annuities that is fully inflation protected, is fairly priced, and, because it is run by the government, is reasonably safe: Social Security benefits. Claiming that Social Security benefits are safe may sound naïve, but my view is actually quite cynical. I believe that as long as the elderly continue to vote in large numbers, no Congress will renege on promised payouts for those already eligible to receive benefits.

Of course, the system has to be tweaked to keep it self-sufficient, but economists of every stripe agree that this is a relatively easy fix, unlike, say, trimming the rising cost of Medicare. The fix might trim benefits in some way, perhaps through a less generous indexing formula, but I believe that anyone already eligible to claim benefits can safely count on getting them.

If you think this premise is preposterous, stop reading here, and complain to your representatives in Congress. (While you’re at it, you might also tell them to get the debt ceiling raised, or better yet, simply eliminate it, so we do not frighten people into thinking we would actually default on our debts, even to ourselves.)

So here is a bit of good news. There is a simple, easy way to convert a portion of your wealth into a fairly priced, inflation-adjusted annuity. Simply delay when you start receiving Social Security benefits.

Participants are first eligible to start claiming benefits at age 62. For those who wait, the monthly payments increase in an actuarially fair manner until age 70. The claiming formula is designed to make the economic value of the stream of benefits the same, regardless of when you start. The longer you wait, the greater your monthly benefits when you start getting checks, because you will not receive them for as long a period. If you wait from 62 to 66 to start, your payments go up by at least a third, and if you wait all the way until 70 to start claiming, your benefits go up by at least 75 percent. (I say “at least” because if you delay claiming and keep working it is possible that you can qualify for an even higher benefit level.)

With these rules, waiting is the cheapest way to buy more annuity coverage. However, few take advantage of this opportunity. Currently, about 46 percent of participants begin claiming at 62, the first year in which they are eligible, the government says. Less than 5 percent of participants delay past age 66. This is unfortunate. If you are in good health and you can afford to wait, my advice is that you should wait as long as possible. The greater is your guaranteed lifetime income, the easier it will be to organize your retirement budget, and the less you will worry about living “too long.”

The Social Security Administration could take some steps to encourage people to delay. First, change some confusing terminology. For historical reasons, Social Security labels an intermediate age between 62 and 70 as the “Full (normal) Retirement Age.” Yes, the parenthetical “normal” is part of the official language. The age had traditionally been 65, but it is slowly being raised to age 67. For anyone born between 1943 and 1954, for example, the age is set at 66.

Let’s get rid of this awkward and misleading term. Benefits at that age are not “full” and retiring at that age is not “normal.” Research shows that the designation of a full retirement age can serve as an anchor that influences people’s choices, and may help explain why so few people delay claiming past age 66.

THERE is a bolder step that could make additional Social Security benefits available for many people. Pamela Perun of the Aspen Institute suggests that participants be able to “top up” their Social Security benefits. Participants could buy up to $100,000 in additional annuity benefits by sending a check to the Social Security Administration. The $100,000 cap is arbitrary, but the idea behind having a cap is to leave the high-end market to the private sector. Payments would just be added to the usual Social Security check, so the administrative costs would be small.

These reforms will not solve everyone’s problems, but they would make household budgeting easier and less worrisome. With baby boomers starting to reach retirement age, now is a great time to take these steps.

Richard H. Thaler is a professor of economics and behavioral science at the Booth School of Business at the University of Chicago. He is also an academic adviser to the Allianz Global Investors Center for Behavioral Finance, a part of Allianz, which sells financial products including annuities. The company was not consulted for this column.

View the original article here

Peliculas Online