Fen Phen Diet Drug Claims Another Victim, This Time It's Fraudster Lexington Lawyer Seth Johnston Who's Off To Prison.

A jailed Lexington attorney who helped collect a judgment for
victims sickened by the diet drug fen-phen pleaded guilty
Wednesday to six federal charges.

Seth Johnston pleaded guilty to two counts of mail fraud,
one count of wire fraud, conspiracy to obstruct justice,
conspiracy to distribute synthetic marijuana and tax fraud,
according to Kyle Edelen, a spokesman for the U.S.
Attorney's office. He entered the plea Wednesday in U.S.
District Court in Lexington.

Johnston had been the focus of a federal investigation into
his financial holdings. The attorney had been jailed on
criminal charges involving synthetic marijuana — the
catalyst for the federal investigation into his finances.

Among the items subject to forfeiture are a horse,
Woodland Dream, and its foal, which has been ordered to
be sold at the Keeneland November Breeding Stock Sale.
Also subject to forfeiture is the Glenn's Creek Beer Exchange
on East High Street, and the Glenn's Creek Brewer's Union
on McCracken Pike in Woodford County, according to court
documents.

The guilty plea involves allegations that he defrauded Angela Ford,
an attorney in Lexington, who represented plaintiffs in a civil law suit
in Boone Circuit Court.That lawsuit alleges breach of fiduciary duties
related to fraud in handling the settlement obtained as a result of a
class-action lawsuit against the manufacturers of the diet drug Fen-Phen.
Ford obtained summary judgment against three attorneys in the lawsuit.This summary judgment award was subsequently reversed in part and is
currently pending appeal in the Kentucky Supreme Court.

Ford hired Johnston to assist in the collection of assets to satisfy the
judgment, according to a court document.

Prosecutors said in a court document that Johnston perpetrated a scheme
to defraud Ford, the attorney representing the plaintiffs in the lawsuit, by
failing to report his collection of funds for purposes of satisfying the judgment
obtained to benefit plaintiffs, and instead used the funds for his benefit.

Johnston was also accused of using assets of an estate that he was hired to
distribute for his own benefit.

He represented that the estate contained cash assets of approximately
$731,601.38. In reality, he was aware that the estate consisted of
approximately $1.8 million in cash assets, prosecutors alleged in
court documents.

On other count, Ford hired Johnston to create three limited liability
companies. Ford was to be the sole member and manager of the LLCs,
and the LLCs were to be created solely for her benefit. Ford and Johnston
set up bank accounts for the three LLCs, and Ford deposited, caused to
be deposited, or intended to be deposited, a combined total of approximately
$3.5 million into the three bank accounts. Johnston was not to spend, invest,
or move the money without Ford's further instruction. Johnston was to bill
Ford for the time he spent creating the LLCs and any accompanying
formation documents.

Johnston also acknowledged a scheme to defraud Angela Ford and
misappropriated some of Ford's funds without her knowledge He provided
documents to hide the scheme regarding the status of her money, prosecutors
alleged.

He also pleaded guilty to filing false income tax returns.

Johnston was being held at the Fayette County Detention Center.

Some of the offenses carry a maximum of 20 years in prison.

Johnston's attorney Bernard Pafunda declined to comment.
(Follow story source here.)

Read more here: http://www.kentucky.com/2013/10/30/2903427/lexington-attorney-pleads-guilty.html#storylink=cpy

With The Clintons It's Always Money, Money, Money And More Money!

Money, Money, Money, Money, MONEY!

Why is it that America’s roil family always seems better in abstract than in concrete? The closer it gets to running the world once more, the more you are reminded of all the things that bugged you the last time around.

The Clintons’ neediness, their sense of what they are owed in material terms for their public service, their assumption that they’re entitled to everyone’s money.

Are we about to put the “For Rent” sign back on the Lincoln Bedroom?

If Americans are worried about money in politics, there is no larger concern than the Clintons, who are cosseted in a world where rich people endlessly scratch the backs of rich people.

They have a Wile E. Coyote problem; something is always blowing up. Just when the Clintons are supposed to be floating above it all, on a dignified cloud of do-gooding leading into 2016, pop-pop-pop, little explosions go off everywhere, reminding us of the troubling connections and values they drag around.

There’s the continuing grotesque spectacle of Anthony Weiner and Huma Abedin. And there’s the sketchy involvement of the Clintons’ most prolific fund-raiser, Terry McAuliffe, and Hillary’s brother Tony Rodham in a venture, GreenTech Automotive; it’s under federal investigation and causing fireworks in Virginia, where McAuliffe is running for governor.

Many Israelis were disgusted to learn that Bill Clinton was originally scheduled to scarf up $500,000 to speak at the Israeli president Shimon Peres’s 90th birthday festivities in June. I guess being good friends with Peres and brokering the accord that won Peres the Nobel Peace Prize were not reasons enough for Bill to celebrate. The Israeli branch of the Jewish National Fund had agreed to donate half a mil to the Clinton foundation. Isn’t the J.N.F. “supposed to plant trees with donor cash?” Haaretz chided before the fund pulled back. “I guess money does grow on trees.”

I never thought I’d have to read the words Ira Magaziner again. But the man who helped Hillary torpedo her own health care plan is back.

In a Times article last week headlined “Unease at Clinton Foundation Over Finances and Ambitions,” Nicholas Confessore and Amy Chozick offered a compelling chronicle about an internal review of the rechristened Bill, Hillary & Chelsea Clinton Foundation that illuminated the fungible finances and tensions between Clinton loyalists and the foundation architects Magaziner and Doug Band, former bag carrier for President Clinton.

You never hear about problems with Jimmy Carter’s foundation; he just quietly goes around the world eradicating Guinea worm disease. But Magaziner continues to be a Gyro Gearloose, the inept inventor of Donald Duck’s Duckburg.

“On one occasion, Mr. Magaziner dispatched a team of employees to fly around the world for months gathering ideas for a climate change proposal that never got off the ground,” Confessore and Chozick said.

We are supposed to believe that every dollar given to a Clinton is a dollar that improves the world. But is it? Clintonworld is a galaxy where personal enrichment and political advancement blend seamlessly, and where a cast of jarringly familiar characters pad their pockets every which way to Sunday.

“Efforts to insulate the foundation from potential conflicts have highlighted just how difficult it can be to disentangle the Clintons’ charity work from Mr. Clinton’s moneymaking ventures and Mrs. Clinton’s political future,” Confessore and Chozick wrote.

The most egregious nest of conflicts was a firm founded by Doug Band called Teneo, a scammy blend of corporate consulting, public relations and merchant banking. Band, a surrogate son to Bill, put Huma, a surrogate daughter to Hillary, on the payroll. Even Big Daddy Bill was a paid adviser.

As The Times reported, Teneo worked on retainer, charging monthly fees up to $250,000 and recruiting clients from among Clinton Foundation donors, while encouraging others to become foundation donors. The Clintons distanced themselves from Teneo when they got scorched with bad publicity after the collapse of its client MF Global, the international brokerage firm led by the former New Jersey governor Jon Corzine.

And Chelsea is now shaping the foundation’s future, and her political future. So there may not be as much oxygen for her troublesome surrogate siblings.

As George Packer wrote in The New Yorker, Bill Clinton earned $17 million last year giving speeches, including one to a Lagos company for $700,000. Hillary gets $200,000 a speech.

Until Harry Truman wrote his memoirs, the ex-president struggled on an Army pension of $112.56 a month. “I could never lend myself to any transaction, however respectable,” he said, “that would commercialize on the prestige and dignity of the office of the presidency.”

So quaint, Packer wrote, observing, “The top of American life has become a very cozy and lucrative place, where the social capital of who you are and who you know brings unimaginable returns.”

The Clintons want to do big worthy things, but they also want to squeeze money from rich people wherever they live on planet Earth, insatiably gobbling up cash for politics and charity and themselves from the same incestuous swirl.

Is Is Way Past Time For This Investigation. The #CapitalistPigsInBowlingGreen Re Killing Us With Outrageous Gas Prices!

Adding fuel to the fire

Bowling Green citizens' group calling for gas price investigation

A group of citizens in the Bowling Green area plans to ask Attorney General Jack Conway to investigate the pricing of gasoline in the city.
On July 17, they will present to the attorney general’s office a petition with more than 2,000 signatures calling for the investigation.

Edward R. Caston Sr. of Bowling Green said he consistently sees Bowling Green with higher gasoline prices than those of surrounding communities.

Prices are also usually the same across most gas stations in the city, he said.

An attorney general investigation could discover the reasons behind the patterns that he sees, Caston said.

“I think what they’ll discover is that the people, whoever they are, have been doing this for too long,” he said.

Caston has been recording gas prices and said that on June 1, gas was 44 cents a gallon higher in Bowling Green than in Simpson County.

While Caston said he’s not anti-business, he does want legitimate reasons for gas stations to raise prices.

“All we want is some fairness,” he said.

Caston and friend William Skaggs have been collecting signatures on their petition since about April, going out occasionally doing things like standing in the parking lot of the Warren County Justice Center to talk to people about signing, Caston said.

They have collected 2,168 names, Caston said.

Caston wrote a commentary on Bowling Green gas prices that was published in the Daily News in February and said the response from people asking what could be done about gas prices prompted him to start the petition.

High gas prices don’t only affect what people pay at the pump, but can add to the cost of transporting products, Caston said. That cost can lead to higher prices for items such as bread and milk.

“It affects every one of us,” he said.

Skaggs said people responded well and seemed to know exactly what he was talking about when he asked them to sign the petition.

“You go north. You go south. You go west. You save 20, 30, 40 cents a gallon,” Skaggs said.

They have also been collecting signatures online at www.change.org, though most of them have come by asking in person, he said.

Caston said that if the signatures he has collected aren’t enough to prompt an investigation, he plans to ask what number would spur some action so he can continue to have people sign the petition.

“We’re willing to go out and get the other names,” he said.

Allison Martin, communications director for Conway, said the attorney general’s office investigated gas prices across the state in 2008. That investigation had an emphasis on the Louisville market but was statewide, which included Bowling Green, she said.

In the 2008 investigation, the attorney general concluded that Marathon Petroleum Co., in acquiring Ashland Oil in 1996, “negatively impacted competition in the gasoline market in Kentucky and in particular in the market of reformulated gasoline, which is required to be sold in Louisville and Northern Kentucky,” according to a 2011 press release from the attorney general’s office.

The investigation was referred to the Federal Trade Commission, which didn’t take any action, Martin said.

There have recently been some leadership changes at the FTC, and about two weeks ago Conway met with new Chairwoman Edith Ramirez, who was appointed to the position in March, and Commissioner Julie Brill. They agreed to have him forward the investigation to the FTC again, she said.

Kroger spokeswoman Melissa Eads said Kroger gas stations strive for prices similar to those of other neighborhood gas stations.

While factors such as natural disasters and fuel production can impact the cost of fuel on a more global scale, local Kroger stores keep tabs on the prices of their competitors in order to set their own prices.

“I can tell you that fuel is a very local and competitive business,” Eads said.

Each of Bowling Green’s Kroger stores has a gas station, and the store’s reward program can help people save money on gas, she said.

“That has really become an important part of our business,” Eads said.

The petition can be signed online at www.change.org. Enter “Jack Conway” into the search function for access.

Breaking News: The Justice Department Is Filing Suit Today Against Apple Over E-book Pricing. So Why Is Apple So Greedy!?

Check out Politico.com for more on the story, and watch the video:



Update: Meanwhile, other publishers sued with Apple, such as Hachette, HarperCollins and Simon & Schuster, have settled their lawsuits with the government (Click here to read all about it), though others, such as Holtzbrinck Publishers, doing business as Macmillan, and The Penguin Publishing Co. Ltd., doing business as Penguin Group, will go to trial, though I suspect they'll settle, too.

It Is Time To Peg Payday Loan Interest Rates To 36 Percent, Or Something More Humane!

Time to payday loan interest rates at 36%
By Anne Marie Regan and Lisa Gabbard

As co-chairs of the Kentucky Coalition for Responsible Lending, a statewide coalition dedicated to protecting family assets by eliminating abusive financial practices, one of our major concerns is the high cost of payday lending.

Payday lenders are permitted to charge an annual interest rate of 400 percent. For several years, our coalition has sought a change in Kentucky law that would cap interest rates on payday loans at 36 percent. We are hopeful that the Kentucky legislature will enact this much-needed change in the next session.

Opposition to high-cost lending is an issue of concern to the broad and diverse group of organizations throughout the state that make up our coalition. Those working to fight against these abuses include well-respected groups such as AARP, the AFL-CIO, the Louisville Urban League, the Family Foundation and the Louisville/Jefferson County Branch of the NAACP.

In addition, a significant number of churches and faith-based groups — the Kentucky Council of Churches, Catholic Charities, the Catholic Conference of Kentucky, the Jewish Community Relations Council, Citizens of Louisville Organized and United Together, Building a United Interfaith Lexington, Habitat for Humanity and the Society of St. Vincent de Paul — have spoken out against the harmful rates charged by these lenders.

Recently, the Kentucky Baptist Convention, the state's largest religious denomination, passed a resolution at its annual meeting encouraging Kentucky to establish an interest-rate cap of 36 percent on all small loans. The convention cited passages from the Bible condemning usury and asserting the proper role of the government to protect people from predatory activity.

The convention also cited data from Kentucky's payday-loan database, collected over a full year by Kentucky's Department of Financial Institutions. In spite of the industry's claim that payday loans are short-term debts, the data prove otherwise. A typical Kentucky borrower took out 10 payday loans in the past year and was indebted by those loans for an average of 160 days. Because of the short repayment terms, typically 14 days, the average borrower is unable to repay in full and has to take out another loan to repay the first.

In effect, the borrower is paying another $45 every two weeks to borrow the same $300. After 10 such renewals, the borrower will have paid $450 in interest on a $300 loan.

Nationally, 75 percent of all loans are churned in this manner. Because payday loans in most cases turn out to be long-term debts, an annual rate of interest is an entirely appropriate and accurate measure of the cost. In fact, Kentucky and federal law both require that interest be calculated on an annual basis and that the annual percentage rate be stated in the payday-loan contract.

The business model of the payday-loan industry is to entrap borrowers, through high interest rates and short repayment terms, into a continuous cycle of debt from which it is very difficult to recover. The Department of Defense was so concerned about the effect on military readiness that Congress passed a 36 percent rate cap on payday loans for military families.

In addition, 17 states and the District of Columbia have either never allowed payday lending or have limited interest to about 36 percent. Kentucky families deserve this same protection.

In 1998, payday lenders successfully pressured the legislature to exempt them from the usury laws that cap interest on other small lending at 36 percent. In today's financially difficult times, when Kentucky families are struggling to make ends meet and when interest rates on most loans are at an all-time low, it is outrageous that Kentucky continues to allow the payday-loan industry to charge such exorbitant rates.

Last year, after hearing from the industry and citizens around the state, the Consumer Advisory Council, which makes legislative recommendations to the governor, determined that 400 percent interest rates were too high and that a rate cap was in the best interest of Kentucky families.

It is time for the legislature to act. Call your representative and senator today and ask them to support a 36 percent cap on payday loans in the next session.

For information, visit our blog at Kyresponsiblelending.wordpress.com or contact us at (502) 333-6012 or (502) 209-5382.

Read more: http://www.kentucky.com/2011/12/05/1983744/time-to-payday-loan-interest-rates.html#ixzz1ffjWHqoT

U. S. Senate Joins House In Passing Bill To Extend The Debt Limit, And POTUS Barack Obama Has Signed Bill Into Law, Thereby Ensuring That The American Ideals -- And God Given Right - Of Borrowing To Live Beyond Our Means, Continues UNABATED. Watch Videos.

Update: The President has now signed the bill into law. As David Gary would say: blow the feast trumpet! Watch video:

Evangelist Pleads Guilty To Defrauding Investors. I Guess He Could NOT Find Enough GULLIBLES To "Sow Seeds"!

Evangelist pleads guilty to defrauding oil investors

Evangelist and revival leader Ernest Cadick

avoided a trial Monday by pleading guilty Monday to 17 counts of fraud, admitting he solicited $718,000 for oil and gas ventures and other investments and spent the money on himself.

Government prosecutors said that from 1994 through 2008 Cadick fraudulently solicited 17 victims, including some he met at churches and religious events.

One investor alone lost $200,000, according to court records. The investors weren’t identified by name in Cadick’s indictment.

“The victims of these crimes were manipulated and their trust abused,” U.S. Attorney David Hale said in a statement.

Cadick entered the guilty plea as part of an agreement in which the government will recommend that he serve four years in prison and pay restitution equal to the amount of the fraud. The plea bargain must be approved by Judge John G. Heyburn II when Cadick is sentenced on Sept. 12.

He faced a maximum of 320 years in prison and a fine of $4 million if he had been convicted at trial in U.S. District Court in Louisville.

Cadick faces another trial July 11 in Jefferson Circuit Court on three counts of theft for allegedly taking $29,500 from elderly victims he met in Evangel World Prayer Center and telling them the dollar would collapse with the election of President Barack Obama.

In court papers, the federal government says that since 1995, Cadick solicited investments from dozens of other investors in addition to those named in the indictment and lived off their money, but never drilled any wells.

Cadick went so far as to pray with potential victims over their investments and invoke Scripture, Calhoun said in a pretrial memorandum.

Cadick already served six months in Franklin County Regional Jail in 2009 and 2010 for contempt of court when he reneged on a deal to repay $88,000 to defrauded investors, including some of the same victims allegedly targeted in the federal indictment.

Cadick, who owned and operated Bardstown-based Kingdom Oil Co., is one of at least a half-dozen Kentucky oilmen to be implicated in recent years in schemes to defraud investors and violate securities laws.

Although the other cases involved more money, the state Department of Financial Institutions has called Cadick's case particularly egregious because he earned the trust of investors in churches.

Cadick and his lawyer, chief federal public defender Scott Wendelsdorf, declined to comment before his trial and Wendelsdorf did not immediately respond to a request for comment Monday.

The case was prosecuted by It was signed Assistant U.S. Attorneys Brian Calhoun and Joe Ansari and investigated by the FBI.

Speculation Explains More About Oil Prices Than Anything Else.

Speculation explains more about oil prices than anything else
By Kevin G. Hall and Robert A. Rankin

WASHINGTON — Feel like you're being robbed every time you fill the gas tank? Not sure who to blame? Try Wall Street.

That's not the conventional explanation, but it's the one the facts point to. Usually analysts say today's high prices stem simply from "supply and demand." They mean demand for oil and gas is rising and supplies aren't keeping up, so people bid up their price. But global and U.S. supplies are plentiful and demand is stable, so that's not it.

Then the analysts say it's because the market's afraid Middle East turmoil will interrupt oil supplies, so nervous buyers are bidding up prices to ensure they lock in a contract for oil now, just in case it's scarce later. There's probably some truth to that, but after five months of turmoil, there's been no significant impact on Middle East oil supplies, even as prices have see-sawed, so that's not credible either.

Here's what's credible: Some 70 percent of contracts for future oil delivery are now bought by financial speculators — largely big investment banks and hedge funds — who never take control of the oil. They just flip the contract for a quick profit.

Only about 30 percent of oil contracts are bought by a purchaser that actually intends to use the oil, such as an airline. That's according to the Commodity Futures Trading Commission, which regulates trade in those contracts.

"I'm convinced ... that speculators are actively manipulating (prices)," said Michael Greenberger, a University of Maryland law professor who in the 1990s headed the CFTC's trading division.

"It's harder and harder for any reasonable observer to dismiss the role of excessive speculation in this market," said Michael Masters, a professional Wall Street investor who knows how this game works. He's testified before Congress repeatedly that speculators are pushing prices up well beyond what supply and demand would warrant.

They both point to a $15 weekly swing in oil prices in early May and $5 a barrel moves on oil prices in a single day — with no obvious change to supply or demand.

Exxon Mobil Chief Executive Rex Tillerson noted Thursday in testimony before the Senate Finance Committee that this year's oil prices don't make any economic sense, though that's not quite how he put it. He said that current fundamentals and production costs would dictate oil in the range of $60 to $70 a barrel. That's at least $43 cheaper than this year's highs of $113 a barrel reached on April 29 and May 2.

But Tillerson declined to opine about the role of speculators, saying only that the price of oil "will be wherever it will be."

Hundreds of billions of dollars are being made through this speculation — both in the regulated futures market and on the larger unregulated over-the-counter swaps market, where private bets about the movement of oil prices take place. It's producing lots of new billionaires on Wall Street and driving oil company profits through the roof.

And it's punishing everyone who drives.

"The sheer volume of new capital coming from hedge funds, financial traders and other long-term passive investors — interests that mostly buy oil futures to turn a quick profit — is creating artificial demand and driving up the price for consumers," said Sen. Maria Cantwell, D-Wash., in a statement accompanying a letter she and 16 other U.S. senators issued Thursday. They, like Greenberger and Masters, urge the CFTC to impose rules limiting speculators' ability to do this.

Masters and Greenberger advocate a return to limits that prevailed for much of the past century. Those limits effectively reined in speculation to about 30 percent of the oil market.

"We need some speculation. We need enough to provide grease for the wheels of the hedgers, but not so much that they drive price formation," Masters said.

A McClatchy review of two decades of data compiled by the CFTC documents the boom in speculative trading amid rising prices. In the 1990s, the ratio of speculative trades to trades made by commercial users of oil was tilted heavily toward users of crude. But from 1991 forward, the big financial players such as Goldman Sachs and J.P. Morgan Chase won exemptions that freed them from limits on how much they could speculate in futures markets.

They became classified as commercial traders, as if they were an airline hedging price risks in jet fuel. The big banks needed to invest in futures contracts to hedge bets they made in the unregulated swaps market. And the government, in the tenth year of Reagan Republicanism, was happy to reduce regulations on markets. Oil "swaps" increased from $13 billion in the 1990s to more than $313 billion in July 2008 at oil's peak price, Greenberger said .

In mid-2006, CFTC data began distinguishing Wall Street's trades from industrial users, calling the strictly financial ones "non-commercial." Suddenly, the record shows that speculative trades raced past commercial trades.

Prior to the 1990s, speculators made up about 30 percent of the futures market. In the latest reporting period, the ratio on May 3 stood at 68 percent speculators to 32 percent users of oil. Meanwhile, the volume of total reported trades has grown five-fold since 1995, underscoring the impact of speculation on futures markets.

"It tells me that there are more speculative positions than there has ever been in history, particularly in the energy sector, I don't mean only crude oil," said Bart Chilton, a CFTC commissioner who thinks excessive speculation is at least part of the cause of soaring oil prices. "In all of the energy sector, we've seen a 64 percent increase in speculative positions since the (oil price) high of 2008."

While those numbers are stark, the numbers on supply and demand make it clear that the high prices aren't coming from there. There is no shortage of oil stocks by historical standards. There's an estimated 3 million to 4 million barrels per day (bpd) of excess oil production capacity in the world today. That's much more than when supplies were tight in 2008.

U.S. oil production, too, continues to grow. It rose from 4.95 million bpd in 2008 to 5.36 million bpd in 2009, followed by 5.5 million bpd last year — even with the BP disaster in the Gulf of Mexico. The Energy Information Administration forecasts U.S. production to hold at that level this year and rise again next year, to 5.54 million bpd.

U.S. crude oil stocks on April 29, the date oil peaked this year above $113 a barrel, stood at 1.768 billion barrels, according to the EIA. That's about 700,000 barrels more than in July 2008, when oil prices hit all-time highs.

And that's plenty to meet U.S. needs, because consumption isn't growing.

The U.S. consumed 20.68 million barrels per day in 2007. Then came the financial crisis, and consumption dipped to 19.5 million bpd in 2008. Last year the number was 19.5 million bpd. This year's projection is 19.28 million bpd.

So if supplies are plentiful and consumer demand isn't rising, why are prices?

Could it be that refineries aren't able to produce enough gasoline? No. Refiners are running their plants at below cruising speed, and they've got lots of room to produce more if consumers need it. The latest data from EIA on the rate at which refineries are utilized showed a rate of 79.8 percent in February. That's 20 percent below full-blown production, and it hasn't been that low since 1986. If demand for gasoline were soaring, these plants would be cranking at a higher rate.

The American Petroleum Institute, the oil industry lobby, disputes this last example, noting that gasoline production continues at near record levels despite the low refinery utilization rates.

"The amount they're squeezing out of the barrel (of oil) has gone up significantly," said John Felmy, the group's chief economist.

Asked if excessive speculation is to blame for high prices, Felmy said no. He said growing economies such as China and India are gobbling up oil and that global energy data shows the price is "pretty consistent with fundamentals," and that "it really tells the tale of a tight market."

That's not what the Paris-based International Energy Agency said Thursday. It forecast flat global oil demand this year. It dialed back its projection for growth in consumption to 1.3 million bpd, less than half last year's growth of 2.8 million bpd.

The report said, "Our own estimates for global oil demand show a marked slowdown, with preliminary March data suggesting near zero annual growth for the first time since summer 2009."

All that leads a growing number of analysts to one conclusion: This year's high prices for oil and gasoline, and their plunges of late, are driven largely by financial speculators making trillions by trading in oil futures while ordinary consumers feel burned.

While the evidence of speculation is increasingly obvious, the facts haven't yet been acknowledged enough to force corrective regulatory action.

"The history of this is there is always something going on in an opaque fashion that you only find out about after an investigation has been launched," Greenberger noted.

President Barack Obama last month ordered the creation of an interagency task force led by Attorney General Eric Holder to determine if price gouging or market manipulation is occurring. But he stopped short of ordering a full-blown investigation with additional government resources.

"My view is that the Justice Department should be actively organizing and driving an investigation that will strain the resources of some of these agencies," said Greenberger, himself a former Justice official. "Just playing 'footsy' with this investigation is a tragic waste of resources."

Justice Department spokeswoman Alisa Finelli insisted that by bringing together state and federal authorities, the task force "enhances our ability to take a comprehensive approach in monitoring and sharing information about the oil and gas markets to determine whether or not there is evidence of illegal activity. "

Meanwhile, 17 U.S. senators, led by Cantwell, say the CFTC should act now.

"American consumers are getting gouged at the pump while speculation on Wall Street runs rampant. Today the CFTC must ... crack down on excessive speculation and provide relief to American consumers," she said.

Read more: http://www.mcclatchydc.com/2011/05/13/114190/speculation-explains-more-about.html#ixzz1ML1DIxPr

Estate And Condo Once Owned By AVARICED Fen Phen Lawyer,, Shirley Cunningham, Sold For One Million And Half Dollars.

Farm, condo formerly owned by fen-phen attorney Cunningham are sold at auction

GEORGETOWN — A 160-acre farm once owned by Lexington attorney Shirley Cunningham Jr. was sold at auction Friday for $1.585 million to Central Kentucky farmer Jim Dwyer.

In addition, a Lexington condominium that Cunningham previously owned was sold at the same auction for $159,000 to a woman who declined to give her name. Auctioneers handling the sale also would not give her name, saying she did not wish to be identified.

The properties were sold by order of a U.S. District Court judge in September.

Cunningham was sentenced in 2009 to 20 years in prison for keeping millions of dollars which should have gone to clients injured by the diet-drug combination of fenfluramine and phentermine, known as fen-phen. The case is under appeal.

Dwyer, a tobacco and cattle farmer, declined to be interviewed after the auction. He has participated in the past with Lexington's purchase of development rights program, an effort to preserve rural acreage by offering compensation to landowners in an exchange for an agreement not to develop.

The Scott County farm sold Friday is off Ky. 25 between Lexington and Georgetown. The main residence overlooks Cane Run Creek and has 4,425 square feet, hardwood floors and an updated kitchen and baths. Also included in the sale were a four-bedroom manager's house, two employee houses, and three barns with 40 stalls. The farm was once valued at $3.4 million, according to a Web site advertising the auction.

The 1,568-square foot Vine Street condo had two bedrooms and 21/2 baths.

There were 11 registered bidders for the condo and 14 for the farm, said David Levy, vice president of LPS Auction Solutions, the Chicago-based firm handling the sale. Between 75 and 100 people gathered on the front lawn of the main house to watch the sale. Some stood near a massive gingko tree.

An order of forfeiture that prevented the property from being sold while Cunningham's case is under appeal was amended to allow the sale by the U.S. Marshals Service, which owned the properties before the auction.

Friday's sale is believed to be the largest in terms of monetary value handled by the U.S. Marshals Service in the Eastern District of Kentucky, said U.S. Marshal Loren "Squirrel" Carl.

The money will go to the victims in the fen-phen case, Carl said. Cunningham and another former attorney, William Gallion, were ordered to pay $127 million in restitution to the victims and to forfeit $30 million to the federal government.

Cunningham and Gallion were the original owners of Curlin, a two-time Horse of the Year. Curlin was later owned by Jess Jackson, a California wine maker who died April 21 at age 81 after a long battle with cancer.

Read more: http://www.kentucky.com/2011/04/30/1724844/farm-and-condo-owned-by-fen-phen.html#storylink=omni_popular#ixzz1L2eEuT2k

Editor's note: Actually, the estate sold for that money. The condo for another one hundred and half grand!

In the interest of full disclosure, I attended a party at the farm once!

Houston Baptist Church "Pastor" John Goodman, Calls Members "Devils, Demons" And Withholds Communion For Refusing To Turn Over Income Tax Refunds.

Pastor Calls Flock Devils, Demons: MyFoxHOUSTON.com

Yes, folks, he is a "Good Man", but he sounds like one of those the Good Book told us has been let loose on poor MISLED souls.

Halliburton Pays Nigerian Government $250 Million To Drop Charges Against Dick Cheney. Now The Company Can Continue Its Nefarious Activities!

Halliburton Pays Nigeria $250 Million to Drop Charges against Dick Cheney

Halliburton Pays Nigeria $250 Million to Drop Charges against Dick Cheney
Nigeria has agreed to drop corruption charges against former U.S. Vice President Dick Cheney and other corporate executives accused of bribing the government to secure a profitable natural gas deal. In exchange for the case’s dismissal, Halliburton, the company Cheney ran during the 1990s, agreed to pay $250 million to the Nigerian government.

A Nigerian prosecutor claimed $180 million in bribes were paid by representatives of Halliburton (which Cheney ran as CEO from 1995 to 2000), its former subsidiary KBR Inc., Technip SA (Europe’s second-largest oilfield-services provider), Eni SpA (Italy’s biggest oil company) and Saipem Construction, a unit of Eni, to secure about $6 billion in contracts for building a liquefied natural gas plant.

Last year, KBR was fined $402 million by the U.S. government after officials pleaded guilty to conspiracy and corruption charges. Also, Halliburton and KBR agreed to pay $177 million in forfeited profits, without admitting any wrongdoing, as a result of a separate civil case.

Better Believe That The Wages Of SIN Is DEATH, As Bernie Madoff's Eldest Son Mark Hangs Himself. Watch News Video.

Nigerian Government Prepares To Indict Dick Cheney, So He Can Join Other Halliburton Officials, In Bribery And Corruption Trials.

Govt charges ex-U.S. VP, Cheney, over Halliburton scam
From Lemmy Ughegbe, Abuja News

THE on-going trial of Halliburton officials and their counterparts in Nigeria who allegedly conspired in the $180 million bribe for contract scandal may have reached feverish heights.

Reason: The Federal Government has preferred charges against former Vice President of the United States (U.S.), Mr. Dick Cheney, over his alleged complicity in the scandal.

Government has also resolved to charge Siemens and AGIP to court for their recalcitrance in spite of their alleged complicity in the scandal.

An impeccable government source told The Guardian that upon the resolution by government’s lawyers and the Attorney General of Federation (AGF), Mohammed Bello Adoke (SAN) that Cheney could not be absolved of complicity in the bribery scandal since he was at that time of the bribery in 2006 the Chairman of Halliburton.
The country’s Chief Law Officer yesterday directed the lawyers to amend the charge sheets in the on-going trial of Nigerian and Halliburton officials to accommodate the charge of criminal conspiracy against him (Cheney).

The source said: “The AGF had on Monday, November 29, 2010 briefed government’s negotiation team made up of a narrow team of technocrats within government and a few carefully screened and selected from the private sector to proceed against Cheney legally”.

Members of Government’s negotiation team include Damien Dodo (SAN), from the private sector, Mr. Emmanuel Akomaye and Godwin Obla, Secretary and Counsel of the Economic and Financial Crimes Commission (EFCC) respectively as well as the Executive Secretary of the National Human Rights Commission (NHRC), Mr. Rowland Ewubare.

Meanwhile, the Managing Director of Halliburton yesterday turned himself in to investigators at the commission and after making some statement, was granted administrative bail pending his arraignment. His counterparts in Technip and Saipem, Frank Ilya and Guiseppe Jurace were picked up last Thursday, but granted similar bail the following day.

Yet another inside source also disclosed that government was determined to ensure that all firms or conglomerate involved in corrupting and compromising a healthy business environment in the country are made to pay by atonement or the full weight of the law would be brought to bear on them.

He noted that after honest consideration of the situation, government decided to explore the viability of the U.S. model for dealing with companies found to have engaged in such criminal practices as occurred in Nigeria.

He explained that under the U.S model, erring companies or individuals are to pay criminal penalty or fine in multiple of the amount of the transaction, disgorge all profits made from that deal and institute a three-year scheme of corporate compliance.

Under such arrangement, the firms and or individual enjoys in return a deferred prosecution agreement, which allows them to be let off the hook if after three years, they are found to have complied with the conditions and have shown good conduct.

The Guardian learnt that it was under that arrangement that Julius Berger approached government for a peaceful resolution of the case against it. Julius Berger was not a direct beneficiary of any contract in the scandal, but served as a conduit to move five million dollars which was passed unto a Nigerian government official.

But the firm upon showing good faith and paying to government 25 million dollars and entering a three year-scheme of corporate compliance, got government to enter a deferred prosecution agreement.

“I must state that the payment of the 25 million dollars does not mean a total let off for Julius Berger. It is in fact probational as it only affords them three years within which they can be fully discharged if they demonstrate good will and conduct”, he explained.

He said while government was open to exploring the U.S. model to the country’s interest, it would not settle for any fine less than the ones paid to the U.S. government since the crimes were perpetrated in Nigeria.
Already, the U.S government has received about 1.28 billion dollars in form of criminal fines and disgorgement of profits thereof from various firms involved, the source disclosed.

He said Siemens has paid 30 million euros, Halliburton has paid 579 million U.S dollars, Snamprogetti and Technip have paid 240 million dollars each as fine and disgorgement to the U.S Government even though the crimes were committed in Nigeria and against Nigeria.

He said while some firms were seeking amicable settlement and offering to comply with the U. S model in negotiation with the Nigerian team of negotiators, others are seemingly aloof.

Government has instructed its legal team to proceed aggressively against Saipem and AGIP with a view to getting convictions against them, it was learnt. The conviction would in turn be used to freeze and confiscate their assets.

Government will not settle for anything less than what these firms have paid to the U.S Government. In fact, it is government’s view that it is better to liquidate criminal corporation than settle for anything less than the criminal fines and disgorgement paid to the U.S”, he stated.

Editor's comment: Believe me when I tell you that Nigerian officials are experts in knowing what bribery and corruption look like.

;-)

United States Senate Panel: Goldman Sachs Made BILLIONS At Clients' Expense. *Tsk, *Tsk.

Senate panel: Goldman made billions at clients' expense
By Greg Gordon and Chris Adams

WASHINGTON — Goldman Sachs reaped "billions and billions of dollars" in profits by secretly betting in 2006 and 2007 that the U.S. housing market would crash, a strategy that conflicted with the interests of its clients who were still buying the firm's risky mortgage securities, Senate investigators said Monday.

"The evidence shows that Goldman repeatedly put its own interests and profits ahead of the interests of its clients," Sen. Carl Levin, D-Mich, the chairman of the Permanent Investigations Subcommittee, told a news briefing. "I think they've been misleading to the country."

The panel provided the first detailed glimpse of its findings from an 18-month investigation into the world's most prestigious investment bank, setting the stage for a hearing Tuesday at which Goldman's chief executive, Lloyd Blankfein, and six other company executives will give sworn testimony.

Blankfein, in testimony prepared for delivery Tuesday, denied that Goldman orchestrated a "massive short," or a series of negative bets that enabled it to ring up huge profits when the housing bubble burst and sank the nation's economy.

"And we certainly did not bet against our clients," he said.

The subcommittee's findings bolstered reports in November and December by McClatchy that Goldman had marketed $57 billion in risky mortgage securities, including $39 billion backed by mortgages that it bought from lenders, in 2006 and 2007, without telling investors that it was secretly making bets on a housing downturn.

Goldman also sold billions of dollars in offshore securities that included subprime mortgages. Securities experts told McClatchy at the time that the practice might have constituted fraud because investors might have opted not to buy the securities if they knew that Goldman was betting on their collapse.

The subcommittee and Goldman, which turned over 2 million documents to the panel in response to subpoenas in June 2009 and on March 12 of this year, have been publicly sparring since Saturday in the buildup to the hearing, releasing dueling sets of company e-mails.

On Monday, the subcommittee released dozens of additional excerpts from internal documents that staffers said show that Goldman mortgage traders, with the knowledge of senior company executives, shifted sharply from positive bets on the housing market to negative ones after a high-level meeting on Dec. 14, 2006. The shift followed 10 straight days of mortgage losses, Goldman has said.

In his 2007 performance review, senior Goldman trader Michael Swenson said that he knew by the summer of 2006 from the "market fundamentals in subprime" that the home mortgage market and related exotic securities were headed for "a very unhappy ending." He said he directed the firm to take a big bet that the market would go down.

As another top trader, Joshua Birnbaum, wrote in his performance review: "Much of the plan began working by February as the market dropped 25 points and our very profitable year was underway."

About that same time — in February 2007 — Blankfein asked in an internal e-mail related to mortgage securities if the firm was "doing enough right now to sell off cats and dogs in other books throughout the division."

Later that year, Blankfein wrote that, "Of course we didn't dodge the mortgage mess. We lost money, then made more than we lost because of shorts."

Goldman has said repeatedly that it made bets against the housing market, via insurance-like contracts known as credit-default swaps, largely in its role as an intermediary for clients, and didn't profit massively when loan defaults soared and home prices nose-dived beginning in the summer of 2007.

Levin said that Goldman has "a lot to answer for."

He and his aides pointed to company documents that repeatedly showed the firm was making proprietary "short" bets, meaning it used its own money.

For example, they pointed to offshore deals assembled by Goldman, in which it bet against risky mortgages from the likes of Long Beach Mortgage, Fremont General and New Century Financial, among the most notorious lenders to marginally qualified homebuyers. In three of the deals, Goldman bet more than $2 billion that the securities would fail, and they were later downgraded to junk status.

In one e-mail in late December 2006, Birnbaum said the company needed to decide whether clients should be invited to make short trades on some marginal securities. In response, Goldman executive David Lehman wrote, "I'd say we definitely keep for ourselves."

Swenson, in his annual review, boasted that his team saved a bundle of money by standing its ground in response to client requests that it cover their short bets on Goldman's own mortgage securities.

"Those were unpopular decisions but they saved the firm hundreds of millions of dollars," he said.

Tuesday's Senate hearing comes 10 days after the Securities and Exchange Commission accused Goldman and one of its vice presidents of civil fraud for allowing a longtime client to stack an offshore deal with dicey home mortgage securities without telling investors that the client planned to bet they would fail. The client, the hedge fund Paulson & Co., made $1 billion in profits on the deal, while two European banks lost that much.

In his testimony, Blankfein said news of the SEC action "was one of the worst days in my professional life."

The Goldman vice president, Fabrice Tourre, said in an e-mail to his girlfriend in January 2007 that he wasn't "feeling too guilty" about the highly leveraged offshore deals he was structuring because he was making capital markets more efficient. So, Tourre wrote, "there is a humble, noble and ethical reason for my job ;) amazing how good I am in convincing myself!!!"

Tourre, Swenson and Birnbaum are among the executives scheduled to testify Tuesday.

Levin said his subcommittee focused on whether Goldman's separate contrary bets were improper, but he deferred judgment on whether they broke securities laws. His staff said that, while Goldman's conduct may not meet definitions of fraud under civil and criminal statutes, Levin has proposed legislation to tighten limits on companies' use of exotic new financial instruments to bet against the securities they sell.

In his testimony, Blankfein addresses the "supposedly massive short Goldman Sachs had on the U.S. housing market."

"The fact is we were not consistently or significantly net 'short the market'

in residential mortgage-related products in 2007 and 2008," he said. He said that during the two years of the financial crisis, while profitable overall, Goldman Sachs lost approximately $1.2 billion in the residential housing market.

Read more: http://www.kentucky.com/2010/04/26/1240619_p2/senate-panel-goldman-made-billions.html#ixzz0mFyWXM4L

More On "UNBRIDLED" CORRUPTION IN Clay County, Kentucky.

One trial's end is only the beginning
Clay County residents expect more fallout in Vote-buying case
By Bill Estep

MANCHESTER — There's a feeling in Clay County these days of waiting for another shoe to fall.

In the past five years, more than a dozen local officials have been convicted of crimes that included extorting kickbacks from a contractor, laundering money for a drug dealer and buying votes on a grand and pernicious scale.

What has people holding their breath, though, is that more than a dozen other current or former public officials also allegedly took part in vote fraud, according to witnesses, prosecutors and court documents.

After several years with FBI task-force agents in town, local residents don't think they've seen the last of the arrests.

"Everyone's asked me a thousand times, 'Who's next, who's next?'" said Manchester police Chief Jeff Culver. "I say, 'I don't know, but I know there'll be more.' I was told that this is not over by people who make those decisions."

Aside from the people convicted, those allegedly involved in election fraud include Circuit Judge Oscar Gayle House; Judge-Executive Carl "Crawdad" Sizemore; county Attorney Clay Massey Bishop Jr.; Commonwealth's Attorney Gary Gregory; property valuation administrator Phillip Mobley; Manchester council member Penny Robinson, former state Rep. Barbara White Colter; state Rep. Tim Couch; former Judge-Executive James Garrison; former Sheriff Edd Jordan; former Magistrate Johnny "Poss" Gregory; and former Jailer Charles Marcum, who planned to invoke his Fifth Amendment right not to incriminate himself if called to testify at a recent trial.

Those current and former officials were identified in court proceedings, but none has been charged.

Sizemore, Bishop, Mobley, Robinson and Couch are up for re-election this year. Jordan is trying to win back the sheriff's office from the man who beat him in 2006, and Johnny "Poss" Gregory is running for judge-executive.

Many of those officials have denied involvement in vote-buying in the past. Last week, several declined to comment or did not return calls, though Sizemore, the affable judge-executive, said he did not give money to buy votes.

If someone included him in a slate of candidates to buy votes for, he wasn't aware of it, Sizemore said.

Whether anyone else is charged, the federal investigation already has uncovered troubling examples of corruption, toppling a cadre of prominent people who once held power and influence locally.

For instance, two-term county Clerk Jennings White admitted he laundered money for Kenny Day, who ran a large drug operation from a pawn shop.

In another case, longtime Manchester Mayor Daugh White, assistant police chief Todd Roberts and Vernon Hacker, a city council member who later headed the 911 system, were charged with getting a drug dealer to burn down a vacant house so the city could buy the lot to build a new police station on it, then paying the dealer with cocaine and protection.

Roberts also was accused of stealing $5,000 from the evidence locker.

Darnell Hipsher, a Manchester council member, pleaded guilty in a scheme to win political points by paving private drives in town at taxpayers' expense.

D. Kennon White admitted that after his mobile-home sales business failed and his father created a job for him as Manchester city manager, he extorted $67,000 in kickbacks from a contractor.

In the most recent phase of the investigation, former Circuit Judge R. Cletus Maricle, former school Superintendent Douglas C. Adams, county Clerk Freddy Thompson and Magistrate Stanley Bowling were convicted of being involved in a wholesale conspiracy to commit vote fraud in pursuit of power, jobs and contracts.

They denied the charges and plan to appeal. Thompson, who filed to run for re-election this year, and Bowling, who did not, can stay in office while appealing.

Clay County, one of the nation's poorest, had a reputation for corruption and vote-buying before the string of arrests the last few years.

"We've been looking at that place for a long time," said David Keller, a former FBI agent who heads the Kentucky section of the Appalachia High Intensity Drug Trafficking Area, a federally funded drug task force that covers parts of Kentucky, Tennessee and West Virginia.

Clay County precinct his first day on the job in Kentucky, in November 1980.

Agents parked an unmarked van near the polling place so they could watch an informant who was wearing a recording device. The agents flattened a tire on the van to keep down suspicion about why it was parked there, he said.

But people at the polling place shook the van and followed it out of the county after an undercover agent changed the tire and drove it away. The informant got scared and quit helping the FBI, Keller said.

That was the same story for years in the county — local people with inside knowledge of corruption wouldn't cooperate with state police and federal agents, Keller said.

Keller recalled an unsolved murder from around 1980 in which a man's head was cut off and his body dumped in a pond. That and other killings contributed to a reputation for violence in the county that didn't encourage people to cooperate with authorities.

The FBI first had trouble getting people to cooperate in its investigation of vote-fraud in the 2002 May primary, even though candidates spent hundreds of thousands of dollars to bribe voters.

People lined up to sell their votes in early, absentee voting. Sizemore, driving past the polling place downtown, said he thought someone was giving away commodity cheese.

But finally, drugs provided a door into the investigation of corruption and vote-buying.

One key figure was Day, arrested in 2005 as part of a multistate cocaine and marijuana ring. Authorities ultimately arrested more than 50 people in the case and confiscated millions of dollars worth of drugs.

In addition to selling drugs, however, Day had been a county election commissioner and longtime vote-buyer, so he had information about vote fraud.

Bobby Joe Curry, the drug dealer who burned down the vacant house for the city officials, also provided information on corruption after he was arrested.

"The stars just lined up to finally clean up Clay County," said Frank Rapier, director of the Appalachia High Intensity Drug Trafficking Area.

The task force helped fund the investigation in Clay County, headed the last few years by FBI Special Agent Timothy S. Briggs.

The High Intensity Drug Trafficking Area focuses on drug investigations. But Rapier said he asked officials in Washington to approve spending its funds on the corruption case because of the link to drugs and because public corruption undermines justice.

"We can't have any kind of law enforcement if we don't have honest public officials," he said.

Local officials said that notwithstanding the uncomfortable publicity over vote fraud and corruption arrests in Manchester and Clay County, there are more honest, hardworking people here than not.

It's also true, however, that inaction by good people played a role in the growth of corruption and deadly drug abuse, said Doug Abner, pastor of Community Church in Manchester.

"Down through time, good people, we just quit being involved," Abner said.

That began to change even before the first public officials went to prison.

A march organized by churches to rally the community against drugs in May 2004 was a key event in the turnaround.

It was a cold, rainy Sunday, but thousands of people walked through town to a rally at a city park.

"You really felt the empowerment of citizens that day," said Karen Engle, director of Operation UNITE, an anti-drug task force in southern and Eastern Kentucky, who attended.

Since then, a coalition of churches and volunteers continued working to increase civic involvement and fight drugs.

Pastors encouraged members to vote. Volunteers set up a program to monitor criminal cases. A television station operated by Abner's church broadcasts local government meetings, and churches work with government officials to tackle local issues.

But the federal investigation has given people hope as well, said Manchester Mayor Carmen Webb Lewis.

Before, many people had stopped voting or being involved in civic affairs because they felt a select few controlled the community or because of the widespread vote fraud, Lewis said.

"You'd leave the voting booth with this empty feeling that what I just did didn't matter," said Ken Bolin, a minister who helped organize the 2004 march.

The federal investigation, however, has shaken up the old power structure and done away with what Culver called the "intimidation factor" from people who controlled jobs, and used that to political advantage.

Lewis said there are people running for office in Clay County this year who wouldn't have considered it before.

"I think there's definitely more hope," she said.

The election this year is a further opportunity for good people to get involved, Abner said.

A group called Clay Countians United plans to promote voting this spring.

"It looks really promising. But if good people don't step up, we'll get back in the same rut," Abner said.

Editor's comment: I wonder when the feds. will wrap up their "CLEAN UP" in Clay County, and bring their cleaning products to the other 124 counties in Kentucky.

Y'all Gotta Read This Evidence Of GREED All Around: Fame, Fortune Desert Louisville Self-Claimed Multi-Millionaire Randall Waldman.

Fame, fortune desert Louisville self-claimed multi-millionaire Randall Waldman
By Andrew Wolfson

Over the past three years, Randall S. Waldman has claimed to have a net worth of $38 million and pledged $1 million to the University of Louisville, which put his name on its new field hockey building.

When Waldman promised to build an electric car plant in Simpson County that would employ as many as 4,000 people, the governor and lawmakers rushed to court him with incentives.

The Kentucky Association of Manufacturing said Waldman's Integrity Manufacturing in Bullitt County set “the gold standard” for others to follow, and Business First named it the “emerging company of the year.”

Editor's comment: this goes to show you that many people will sell their souls to the devil. In this story, you read that many people were lined up to do so.

*SIGH*

But the company has gone bankrupt, the electric car plant was never built and Waldman's name was unceremoniously removed from the field hockey center when he failed to come through with his pledge to UofL.

Waldman, 53, now says in court papers that he is selling roofing for $500 a week for a company owned by his ex-wife and that he has barely enough money to pay his utility bills.

His $178,000 Mercedes Benz AMG and Cadillac Escalade have been repossessed. His 9,300-square-foot, nine-bath, $1.4million home is in foreclosure. And a trail of creditors, including two banks and a finance company to which he owes more than $7million, are searching for any remaining assets.

Testifying under oath, Waldman has admitted in court records that the net-worth statement he used to win loans was a patchwork of exaggerations and omissions.

Friends and associates say in court records and interviews that he also exaggerated his own accomplishments — falsely claiming that he played basketball for UofL, that he owned Brown & Williamson Tower and that he made $150million “bailing out” a computer company that says he was a regional sales manager.

A federal bankruptcy judge who issued a $3.2million fraud judgment against Waldman in October denounced his “propensity for self-aggrandizement.”

Greg Schaefer, a neighbor in Eastwood's Locust Grove subdivision, said: “I consider him a friend, but you can't believe everything he says.”

Waldman, who with his companies is named as a defendant in more than 20 lawsuits in Bullitt and Jefferson counties, declined to be interviewed or respond to questions submitted to him in writing. His attorney, Kenneth Bonhert, also declined to comment.

The lawsuits include one filed April 1 by Action Capital Corp., which claims that Waldman and Integrity collected a portion of $4million in financing from the Atlanta-based company by fraudulently presenting invoices for 2,828 utility trailers that hadn't been manufactured. Former suppliers and contractors who did business with Waldman say it is ironic that he called his company “Integrity,” because, they contend, he avoided phone calls and refused to pay his company's bills.

“He took advantage of a lot of people and ruined a lot of lives,” said Dan Flynn, owner of Innovative Tooling Inc., who won a $10,000 judgment against Waldman's company for an unpaid bill but was unable to collect it after Integrity filed for bankruptcy protection last September.

They say Waldman's failure to pay his company's debts was especially stunning, given his claims to be worth millions.

In 2008, for example, seeking to increase Integrity's line of credit with Alro Steel Corp. of Jackson, Mich., Waldman e-mailed a financial statement to the company claiming he had a net worth of $38,218,420.

“Please keep this confidential,” Waldman said. “I need this increase done ASAP.”

The company, in a lawsuit to recover $432,467 in unpaid bills, including $300,000 Waldman guaranteed personally, said Waldman knew the statement was false.

In 2007, as part of his application for a $1.5million loan from National City Bank, Waldman submitted a statement saying he owned assets of $25.3million and had liabilities of $4.3million, according to court records.

But when questioned by the bank's lawyer in September, he said, “I think there's some items on there that don't seem to be correct.”

While he claimed to own $8.6million in property, for example, including his home on Weatherford Circle in Eastwood, he conceded that he failed to list about $6million in mortgages.

He claimed to own $243,000 in luxury vehicles, but acknowledged that he leased them. And while he listed $464,840 he owned in stock and options from a former employer, he admitted in court records that they were expired and worthless.

Under federal law, it is a crime to make a false statement willfully overvaluing any property or other assets in a loan application to a federally insured bank. But local and federal law enforcement officials won't say whether they are looking into Waldman's statements.

Waldman blamed his accountants for the errors and omissions, though asked in his deposition why the mortgages were left out, he said, “I would have no clue.”
ZAP plans go south

Waldman first broke into the news in 2004, as CEO of a newly formed boxing company to promote a comeback fight by heavyweight Riddick Bowe.

“Our goal is to have a fight here every 60 days,” Waldman said. “We want to revitalize Louisville Gardens.''

But Bowe hurt his shoulder and canceled.

Two years later, Waldman opened a 120,000-square-foot metal fabrication plant, Integrity, on Ky. 44 in Bullitt County. He said in news accounts that he had spent $15million on it, including some of his own money.

By 2007, Integrity, which made utility trailers and other metal products, appeared to be growing so rapidly that Martin Kish, then vice president of communications for the Kentucky Association of Manufacturers, told Business First that it belonged in the company of such state manufacturing powerhouses as General Electric and Toyota.

“The industry has some things to learn from them,” Kish said in the article.

By May 2008, though, Integrity was unable to repay the debt on its $1.5million loan to National City, court records show.

Still, when Waldman announced in July 2008 that he intended to build a company — Integrity Automotive — that would make electric cars for a California-based company called ZAP Corp., Gov. Steve Beshear pushed through an executive order allowing slow-moving electric vehicles on Kentucky's roadways in an effort to land the plant.

The Santa Rosa-based ZAP had originally planned to build its cars in China.

A ZAP spokesman told The Courier-Journal at the time that it hadn't talked to Waldman about his plan, even as the state promised $48million in tax incentives if Waldman's company fulfilled its promise to employ 4,000 people and bring in $176million in investments.

Kentucky Economic Development Secretary Larry Hayes insists the state wasn't “snookered” by Waldman and that no incentives were paid.

“We knew financing wasn't in place,” Hayes said.

Jim Brown, who was then Franklin's mayor, said that while the city didn't lose money on the failed plant, it was left with “a lot of our egg on our face, because we all embraced it and had high hopes for it.”

Brown, now Franklin's city manager, said Waldman was a salesman “who made a lot of statements that obviously proved false,” including that he had an ownership interest in ZAP.

“It was a house of cards, and once it started crumbling, it crumbled fast,” Brown said.

So did Integrity Manufacturing in Bullitt County.
Loan-shark allegations raised

Waldman claimed that as many as 400 people worked at Integrity, but Bob Fouts, executive director of the Bullitt County Economic Development Authority, said employment was probably half that at its height.

“We found out he wasn't paying suppliers and other creditors,” Fouts said in an interview. “The more dialogue we had, the more questions we had.”

Waldman was forced out as CEO in February 2009 by the company's lenders, and Integrity shut down a few months later.

John Anson, whom Waldman hired as a consultant, said the problem was that Waldman's background wasn't in manufacturing.

“He didn't know what he was doing,” said Anson, who sued Integrity for nearly $400,000 in compensation but collected nothing because it discharged its debts in the bankruptcy.

In October, U.S. Bankruptcy Judge Joan Lloyd issued a scathing order against Waldman after he failed to uphold his promise to bail out a tool-machinery company owned by Ronald Stone.

Instead, the judge said, Waldman and lawyer Bruce Atherton, in what she described as among the most blatant frauds she'd ever seen, took Stone's assets and drove his company out of business.

Waldman and Atherton have filed notice that they will appeal the judgment.

Lloyd also criticized Waldman for lending Atherton's secretary $20,000 to buy a BMW, and then having two employees whom he called “his leg-breakers” repossess the vehicle after she defaulted on her payments.

Testifying in bankruptcy court, Waldman was asked if he sent “two large men” to repo the BMW. He responded: “Do you have a problem with fat people? I don't.”
Growing up in Jeffersontown

Waldman's father, stepfather and grandfather were all pharmacists, according to their obituaries.

Waldman, a Jeffersontown High School graduate, has two adult daughters, has been married twice, and has lived in a house on Weatherford Circle that in 2003 was described as probably the largest and most expensive ever shown as part of Homearama.

The Deutsche Bank National Trust Co. has sued to foreclose on it, but a deputy sheriff said in court records recently that Waldman has evaded service.

After his father, Alan Waldman, died in 2007, Waldman was removed as the executor of his estate when he was accused of concealing $134,963 that otherwise would have gone to his stepmother, Carol Waldman, according to probate court records.

He used to own an 80-unit apartment complex, Chateau Village, in Okolona, as well as a majority interest in the Poplar Level and Woodland shopping centers.

The facts surrounding his professional career are murkier.

Boxing promoter Chris Webb said Waldman once told him he owned Brown & Williamson Tower and Computer Associates, a $4billion publicly traded company. A spokeswoman for CA, as it is now known, said Waldman worked for the company for about six years as a sales manager in Mason, Ohio.

A company bio for another former employer, iChargeit, an online retail mall company, says Waldman graduated with a bachelor's degree in marketing from UofL in 1984, while the university's registrar says he attended for one semester, in the summer of 1976.

Stone said Waldman told him he owned two motorcycle companies that would generate as much as $3million in business for the tool-machinery company. But on cross-examination in his bankruptcy trial, Waldman couldn't name either company.

Schaefer and others say Waldman also has boasted of playing for UofL. In his deposition, Waldman said, “I tell people that I'm an MVP, a most important payer, but I don't say that I played basketball.”

Other claims are impossible to check, because of the passage of time.

Waldman testified in bankruptcy court that he was the youngest store manager in the history of Radio Shack, that he “closed a little account called UPS” when he was a salesman for the now defunct Wang Laboratories, and that at Oracle, the computer giant, he worked with CEO and founder Larry Ellison, closing deals worth “tens and hundreds of millions of dollars.”

David Braughler, a former colleague at Computer Associates, where Waldman worked until 2006 and said he made $560,000 a year, described him as “one of the best salesman I knew” and said he may have been paid that much.

In his deposition, Waldman told the banks to which he personally guaranteed loans that he is virtually penniless, in part because he has generously lent money to people who didn't pay him back.

“I sunk every frigging penny that I had into this thing,” he said of Integrity, “living the dream, thinking it was going to, you know, be the next coming of the Messiah.”

But creditors and their attorneys say they believe Waldman may have assets left.

For example, in 2008, he transferred a lake house in Grayson County he said was worth $775,000 to a corporation called RSW LTD III, which he couldn't identify at his deposition.

State records list him as the company's sole officer.

And the roofing company he works at and says is owned by his ex-wife, Hila Barker, was organized by an accountant who used to work for him at Integrity, according to state records.

“I suspect Mr. Waldman has funds in places that he doesn't want people to know about,” said attorney Dennis Murrell, who helped win the $3.2million judgment for Stone. “We will look to find them.”

Reporter Andrew Wolfson can be reached at (502) 582-7189.

Lexington Herald Leader Editorial Sees "KLC [Kentucky League Of Cities] Ignoring Its Reform Promises". I AGREE!

KLC ignoring its reform promises

Lawmakers, take note: Promises by the Kentucky League of Cities to clean up its act are ringing hollow.

As staff writer Linda Blackford reported, the League has renewed a lucrative contract without competitive bidding, which conflicts with the state auditor's recommendations.

Also, the $156,646 a month contract is going to a company with whom one of the League's top executives has conflicts of interest.

Does this sound like an organization that's turning over a new leaf?

Lawmakers should pay attention because legislation aimed at improving scrutiny of the League's operations may be at risk of running aground, on political egos.

The legislation, which also applies to the Kentucky Association of Counties, would subject both organizations to open meetings and records laws, give their boards a code of ethics, require them to adopt procurement polices in compliance with state law and authorize the state auditor to review their books.

We won't attempt to dissect the pride-of-authorship conflicts that are threatening these reforms, which are not controversial and have already been approved by both chambers.

Suffice it to say that most taxpayers don't care in which chamber a bill originates or who sponsors it, they just want the legislature to look out for their interests.

And it's definitely in taxpayers' interests to avoid a repeat of the outlandish spending and lax accountability uncovered by the Herald-Leader and state Auditor Crit Luallen.

But there was no competitive bidding before extending an insurance claims company's contract for well over $5,000. Why? The League has recently taken over the Kentucky School Boards Insurance Trust. Officials said it would be unwise to change claims carriers while taking on a large new line of business.

That's not unreasonable. But the decision would be much more credible had it been made after considering competing bids.

KACo was the subject of scathing audits in 1992 and 2009.

If the legislature fails to strengthen the laws governing these organizations, more scathing audits and taxpayer abuse will be inevitable.

ALL 8 Clay County, Kentucky, Elected Officials CONvicted Of Vote Buying. I Say: Good Riddance To ALL of Them. Feds Should CLEAN Up Other Counties Too.

Jury convicts all 8 defendants in Clay County vote-buying case
By Bill Estep

FRANKFORT — Some of the most powerful politicians in Clay County corrupted the election process in recent years, buying and stealing votes in pursuit of power and money, a federal jury ruled Wednesday.

After deliberating for more than 9 hours over the past two days, the jury convicted all eight people on trial, including former Circuit Judge R. Cletus Maricle and former school Superintendent Douglas C. Adams, on a racketeering conspiracy charge. That charge was that they used the county election board as a tool to rig elections, appointing corrupt precinct officers to help with vote-buying.

The jury convicted several of the defendants on other charges as well, including mail fraud, extortion and laundering money that was used to buy votes.

They face up to 20 years in prison, though their sentences will likely be less under advisory guidelines.

Those charged in the case are Maricle; Adams; county Clerk Freddy W. Thompson; Magistrate Stanley Bowling; Charles Wayne Jones, a former Democratic election commissioner; William Stivers, a former election official; and William Bart Morris, who owns a garbage-transfer company, and his wife Debi Morris, who owns a beauty shop.

They allegedly used the county board of elections as a vehicle to buy and steal votes between 2002 and 2007 so they could get power, jobs and contracts.

The verdict was the latest in a series of torpedoes that have blown a hole in the power structure that held sway in Manchester and Clay County for years.

Several once-prominent officials went to prison in earlier phases of the federal investigation on corruption and drug charges, including a longtime mayor of Manchester, an assistant police chief, city council members, a county clerk and magistrates.

And the case involving Maricle and Adams raised the possibility that there could be more charges. Prosecutors and witnesses said several other public officials in Clay County took part in vote-buying during the same period covered in the charges against Maricle.

The eight residents were charged with scheming to buy or steal votes in the local elections in 2002, 2004 and 2006.

The indictment charged that Maricle and Adams were political bosses who used their powerful positions to head up the effort. The others allegedly played various roles, such as choosing corrupt election officers to help with buying votes; paying voters; and lining up people to sell their votes.

The eight wanted to control elections so they could get power and enrich themselves and friends in a place where jobs are scarce, according to the charges and arguments in court.

In addition to jobs, there were city and county contracts at stake for Bowling's excavation company and Bart Morris' business, prosecutors argued.

"In Clay County, if you're not in politics or in with the clique, you don't get nothing," Kenneth Day, a convicted drug dealer and professed vote-buyer, testified.

The scheme to buy votes allegedly worked with practiced efficiency.

Participants checked lists of voters to identify those who would take bribes and lined up people to drive them to the polls, where precinct workers made sure they voted correctly and gave them a sticker or ticket to redeem for their payment, according to the indictment and testimony.

Candidates banded together in slates and pooled their money to buy votes, spending hundreds of thousands of dollars in some elections, witnesses said.

Testimony indicated that vote-buying has been widespread and chronic in Clay County.

After Eugene "Mutton" Lewis, a convicted drug dealer who said he'd bought votes for decades, testified about a candidate giving him $1,000 and asking for help, a defense attorney asked if there weren't ways to help a candidate besides buying votes.

"Not that I know of," Lewis responded.

The May 2002 primary — the first election cited in the indictment — was allegedly a high-water mark of vote fraud in the county, largely because of a bitter race for county clerk.

In that race, Thompson challenged incumbent Clerk Jennings B. White in the Republican primary.

The Whites had been a powerful political family in the county for years, holding the offices of mayor, school superintendent, county clerk and state representative at one point, with allies in other offices.

But in 2002, Adams decided to whip Jennings White, Adams' attorney, R. Kent Westberry, told jurors.

It was personal — one of Adams' daughters had a drug problem, and White was close to Day, a large-scale drug dealer, and other local officials who were protecting drug trafficking, Westberry said.

The election was a volatile, violent affair. White used his connections to have a Thompson supporter arrested and staged a shooting of his own van, which then-Sheriff Edd Jordan, an ally of White's, said could have been carried out by Thompson's supporters.

Thompson said his house was shot into, and a man who had dug up dirt on White was shot from ambush.

The candidates and their allies allegedly put up several hundred thousand dollars to buy votes in the election, which Thompson won after precinct workers White thought were in his pocket allegedly abandoned him.

The FBI got complaints about the election and collected records that showed a high number of people asked for assistance in voting, said FBI special Agent Timothy Briggs.

Election officers go into the voting booth with people who request assistance, so that's one tactic vote-buyers use to make sure people vote as they were paid to vote.

Briggs said 78 people asked for help in that election because they were blind, but investigators found nearly 40 had a license to drive. Many drove to London after the FBI asked then to come for interviews, Briggs testified.

The FBI at first couldn't get people to cooperate in the election investigation, but that changed in 2005 after federal agents arrested dozens of people in a multi-state drug case, including Day, who had been a county Republican election commissioner and said he'd bought votes for years.

Defense attorneys did not argue there was no vote-buying in Clay County.

In fact, Maricle admitted buying votes for a circuit-judge candidate he supported in 1983 — though he said he hadn't bought votes since — and Thompson's attorney acknowledged people bribed voters for him in 2002.

But Maricle, Adams and the others argued that they had not bought votes during the time covered in the charges. They also said they didn't band to rig elections, and in fact had been on opposite sides in some races.

For instance, Adams, Stivers and Jones supported Thompson in the 2002 race, while Bowling and the Morrises supported White, defense attorneys said.

Those charged also said many of the witnesses against them — several of them convicted felons -- had reason to lie for prosecutors in hopes of getting help with their own legal troubles.

One key witness for the prosecution was D. Kennon White, who had been city manager of Manchester under his father, Mayor Daugh White, before admitting he extorted $67,000 in kickbacks from Bowling on city contracts.

Another was White's wife, Wanda, who also had worked for the city before Daugh White lost his bid for an eighth term in November 2006 while under federal investigation.

Kennon and Wanda White had been friends with Maricle, but after they got in trouble, they wore hidden tape recorders in 2007 to tape conversations with him and others.