Replies to post #162895 on Tornado Alley (PROG)

[F6]

Merrill Lynch to Pay $315 Million to Settle Mortgage-Loans Lawsuit

By DAN FITZPATRICK And CHAD BRAY
DECEMBER 7, 2011

Bank of America Corp.'s Merrill Lynch & Co. has agreed to pay $315 million to end a mortgage-securities lawsuit, in a preview of what could be a long line of settlements as investors step up efforts to recoup losses from the mortgage meltdown.

Bank of America has already set aside funds for the pact. Wells Fargo & Co. reached a similar pact earlier this year with a group of pension funds for $125 million.

The agreement rates as the largest known settlement of a securities class-action case brought by investors in mortgage-backed securities that aren't government backed, said Jeff Nielson, a managing director at banking-industry consultant Navigant.

The case was brought by a variety of public retirement systems, including lead plaintiff Public Employees' Retirement System of Mississippi.

Merrill didn't admit to any wrongdoing in settling the lawsuit, which alleged that securities backed by pools of mortgages didn't match up with sellers' promises. The agreement will now go before U.S. District Court judge Jed Rakoff for approval. Mr. Rakoff rejected a $33 million settlement between Bank of America and the Securities and Exchange Commission proposed in 2009 before reluctantly approving a later $150 million agreement he called "half-baked justice at best."

A backlog of similar legal complaints against Bank of America and other big U.S. banks highlights the challenges faced by large financial institutions as they struggle to put the financial crisis behind them and soothe investor concerns about their future profitability. Stocks of major U.S. banks have been under pressure all year amid concerns about how much it will take to settle all scores stemming from the financial crisis.

No bank faces greater exposure to mortgage litigation than Bank of America, which purchased troubled mortgage lender Countrywide Financial in 2008 and securities firm Merrill Lynch & Co. in 2009. The legal problems are a major reason Bank of America stock is lagging behind stocks of U.S. rivals J.P. Morgan Chase & Co. and Citigroup Inc. Shareholders are also worried about the impact of U.S. regulatory reform, lackluster revenues, higher capital requirements from regulators and weak loan demand.

"The legal woes of big banks regarding mortgage loans never seem to end," said Frederick Cannon, banking analyst with Keefe, Bruyette & Woods.

The lawsuit relates to about $17 billion in mortgage-backed securities. The lawsuit doesn't say how much investors lost but touches on delinquency rates for individual securities.

An amended complaint filed in July 2010 alleged offering documents for the mortgage-backed securities either made untrue statements or omitted material facts regarding the underwriting standards purportedly used in originating of the underlying mortgages; the maximum loan-to-value ratios used to qualify borrowers; the appraisals of the properties underlying the mortgages; the debt-to-income ratios permitted on the loans; and the ratings of the mortgage pass-through certificates themselves.Lawyers will file a request with the court for attorneys fees, plus interest, to be paid from the settlement fund at a later date. Settlement documents didn't include a reimbursement amount.

The delinquency, foreclosure and bank-ownership rates on the underlying mortgages have soared since issuance, according to the lawsuit. As of June 2010, more than a third of the underlying loans in 15 of the 19 securities purchased by the plaintiffs were more than two months behind in their payments, in foreclosure or repossessed and owned by a bank, according to the lawsuit. In seven of these trusts, the rate is at or above 50%.

Bank of America has settled other mortgage-related case for larger amounts, including a subprime-related securities suit by shareholders for $475 million, a subprime-securities class-action settlement stemming from the actions of Countrywide for $624 million, and $1.1 billion to bond insurer Assured Guaranty Ltd. to settle claims about poor-performing mortgage bonds guaranteed by Assured. The Charlotte, N.C., bank also last summer agreed to pay $8.5 billion to settle claims by a group of high-profile investors that lost money on securities purchased before the U.S. housing collapse. That deal still needs court approval.

Many more securities cases are working through the courts. In Los Angeles, there are 13 federal securities lawsuits against Countywide Financial pending before U.S. Judge Mariana Pfaelzer and seven more cases awaiting final approval to move forward in that same court. Those include a $10 billion suit from insurer American International Group Inc. alleging Bank of America, Merrill Lynch and Countrywide packaged securities backed by defective mortgages.

Ruth Simon contributed to this article.

Write to Dan Fitzpatrick at [e-mail] and Chad Bray at [e-mail]

Copyright ©2011 Dow Jones & Company, Inc.

http://online.wsj.com/article/SB10001424052970204770404577082201565957974.html [with comments]

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[StephanieVanbryce]

AG to Netanyahu: Bills targeting rights groups' funds are unconstitutional

'If these bills become law, I won't be able to defend them against the petitions that will be submitted to the
High Court,' Attorney General Yehuda Weinstein warns government.

By Tomer Zarchin and Jonathan Lis 00:43 07.12.11

Proposed legislation to restrict foreign governments' donations to nongovernmental organizations is unconstitutional, Attorney General Yehuda Weinstein warned this week, and if it passes the Knesset, he will not be prepared to defend it in the High Court of Justice.

"The attorney general's policy is to refrain as much as possible from declaring laws unconstitutional, out of respect for the legislative work of the cabinet and Knesset," Weinstein wrote in a letter to Prime Minister Benjamin Netanyahu this weekend explaining his unusual decision. "But in light of the blatancy of the case before us, deviating from this policy is justified. What this means is that if these bills become law, I won't be able to defend them against the petitions that will be submitted to the High Court. That is what I intend to tell the Knesset, and afterward the Supreme Court."

The two bills in question were submitted by MKs Ofir Akunis (Likud ) and Faina Kirshenbaum (Yisrael Beiteinu ). Both are disproportionate and unconstitutional, Weinstein said.

"They deal a harsh blow to a long list of constitutional rights, including freedom of expression, freedom of association and the right to equality," he wrote. "Instead of enabling open discussion in an efficient 'marketplace of ideas,' they try to suppress speech. They put Israel on a par with the handful of countries that have taken similar steps, and I doubt the State of Israel should be jealous of these regimes and act like them."

In international forums, he noted, Israeli representatives boast of the country's active civil society and human rights organizations, as these are essential elements of a democratic state. "It's true that these organizations' activities don't always accord with the Israeli government's positions. But they are an important voice that shouldn't be silenced."

While the bills' declared aim is to prevent foreign states from intervening in Israeli public life, in fact, money from abroad is welcomed in many areas of Israeli life, he wrote. "Therefore, it seems the true aim is different. From the bills' explanatory notes and the discussions in the Ministerial Committee for Legislation, it seems the bills are meant to prevent support for organizations that slander the State of Israel. These are mainly human rights organizations. But even if this is the goal, I doubt it's an appropriate goal, because silencing legal activity cannot be a legitimate goal."

Instead of the bills, he proposed other means of dealing with the problem, such as improving the transparency of donations and making diplomatic efforts to dissuade foreign governments from funding such groups. "Beyond that," he wrote, "the right way to deal with different opinions is by raising counterarguments in the framework of open discussion in the 'marketplace of ideas' that characterizes a democratic society."

The bills in question were both approved by the Ministerial Committee for Legislation, but four ministers then appealed this decision to the full cabinet. Soon afterward, Netanyahu decided to freeze the bills, so the cabinet has yet to consider them. That means the Knesset also can't vote on them.

Last week, therefore, Akunis and Kirshenbaum decided to shelve those bills and submit a new, joint proposal. The new bill would ban foreign governments from donating any money to NGOs that support indicting Israeli soldiers and officials in international courts or encourage soldiers to refuse to serve. Other NGOs could accept donations from foreign governments, but the money would be taxed at a rate of 45 percent, unless either they are also funded by the Israeli government, or the finance minister and the Knesset Finance Committee exempt them.

http://www.haaretz.com/print-edition/news/ag-to-netanyahu-bills-targeting-rights-groups-funds-are-unconstitutional-1.400002

In yesterdays Haaretz on the front page .. In Opinion, there was this .........

Haaretz Editorial

Human rights in Israel are in jeopardy
Nehemia Shtrasler

Netanyahu is tricking Israelis like the Dutch tricked Indians
khaled diab

The common cause of Netanyahu and Ahmadinejad
http://www.haaretz.com/print-edition/opinion/the-common-cause-of-netanyahu-and-ahmadinejad-1.399756

[StephanieVanbryce]

Netanyahu shelves cabinet discussion on bill to limit foreign funding to NGOs

Sources in prime minister's office say Netanyahu wants to mull over the proposal in light of warning letter he
received from Attorney General, who said he could not defend bill in High Court.

By Barak Ravid Latest update 18:36 07.12.11

Prime Minister Benjamin Netanyahu decided Wednesday to postpone the cabinet discussion on a bill aiming to restrict foreign funding to Israeli nongovernmental organizations, which was originally scheduled for next Sunday.

According to sources in Netanyahu's bureau, the prime minister decided to suspend the discussion following a warning by Attorney General Yehuda Weinstein, who said in a letter to Netanyahu that he would not be prepared to defend the proposed legislation in the High Court of Justice should it pass the Knesset vote.

"The prime minister wants to think over the proposal in light of the letter he received and then decide how to move forward and handle this bill," an official in Netanyahu's bureau said Wednesday.

Over the weekend, Weinstein told Netanyahu in a letter that should the bill become a law, he will be unable to defend it against petitions that would be submitted to the High Court.

"The attorney general's policy is to refrain as much as possible from declaring laws unconstitutional, out of respect for the legislative work of the cabinet and Knesset," Weinstein wrote in a letter to Prime Minister Benjamin Netanyahu this weekend explaining his unusual decision.

"But in light of the blatancy of the case before us, deviating from this policy is justified. What this means is that if these bills become law, I won't be able to defend them against the petitions that will be submitted to the High Court. That is what I intend to tell the Knesset, and afterward the Supreme Court."

The two bills in question were submitted by MKs Ofir Akunis (Likud) and Faina Kirshenbaum (Yisrael Beiteinu ). Both are disproportionate and unconstitutional, Weinstein said.

"They deal a harsh blow to a long list of constitutional rights, including freedom of expression, freedom of association and the right to equality," he wrote. "Instead of enabling open discussion in an efficient 'marketplace of ideas,' they try to suppress speech. They put Israel on a par with the handful of countries that have taken similar steps, and I doubt the State of Israel should be jealous of these regimes and act like them."

In international forums, he noted, Israeli representatives boast of the country's active civil society and human rights organizations, as these are essential elements of a democratic state. "It's true that these organizations' activities don't always accord with the Israeli government's positions. But they are an important voice that shouldn't be silenced."

The bills in question were both approved by the Ministerial Committee for Legislation, but four ministers then appealed this decision to the full cabinet. Soon afterward, Netanyahu decided to freeze the bills, so the cabinet has yet to consider them. That means the Knesset also can't vote on them.

Last week, therefore, Akunis and Kirshenbaum decided to shelve those bills and submit a new, joint proposal. The new bill would ban foreign governments from donating any money to NGOs that support indicting Israeli soldiers and officials in international courts or encourage soldiers to refuse to serve. Other NGOs could accept donations from foreign governments, but the money would be taxed at a rate of 45 percent, unless either they are also funded by the Israeli government, or the finance minister and the Knesset Finance Committee exempt them.


http://www.haaretz.com/news/national/netanyahu-shelves-cabinet-discussion-on-bill-to-limit-foreign-funding-to-ngos-1.400184

[StephanieVanbryce]

Israeli military base attacked by Jewish extremists in West Bank

Attack came hours after settlers stormed monument as some say 'homegrown terrorism' is now greatest threat to security

Phoebe Greenwood in Jerusalem Tuesday 13 December 2011 12.56 EST

VIDEO HERE

Jewish protesters gain access to Qasar al-Yahud baptism site on the Jordanian border. Link to this video

A gang of 50 Jewish settlers and rightwing activists have broken into an army base near the Israeli settlement of Kedumim in the West bank, setting fire to tyres and hurling rocks at both Israeli soldiers and Palestinians.

One settler forced open the door of a jeep carrying the Efraim Regional Brigade's commander, who was hit in the head with a rock and suffered minor injuries. Soldiers managed to force the group back outside the base after several minutes but by the time Israeli police arrived at the scene, most of the attackers had fled. Only two were arrested.

The attack is the latest in a wave of violent retributions exacted by extremist Jewish settler groups against Palestinians and the Israeli Defence Forces in response to government policy to evacuate illegal outposts in the West Bank. A spokesperson for the Israeli military said it was the most serious assault on its forces by Jewish activists to date.

Israel's defence minister, Ehud Barak, described the incident as "homegrown terror", which he warned would not be tolerated. "We will capture those responsible and they will stand trial," he vowed. "They endangered lives and their actions threaten to damage the delicate relations Israel has with its neighbours."

Hours after the attack, prime minister Binyamin Netanyahu called an emergency meeting to address the mounting threat posed by extremists. "The situation is intolerable," he told assembled ministers. "We must take care of these rioters with a firm hand. We will not tolerate a situation in which IDF officers and soldiers are attacked and distracted from protecting Israeli citizens."

The attack at Efraim took place just hours after 17 members of an extreme settler movement, the Hill Top Youth, stormed a religious monument on the border with Jordan. The group cut through a barbed-wire fence surrounding marking a closed military zone and seized the Qasr al-Yahud church, thought to be the site of Jesus's baptism by Saint John. Two minors were released and 15 other activists were detained for questioning by Israeli police.

They were protesting against Jordanian involvement in the ongoing debate over the Mughrabi Bridge, which leads from the Western Wall to the Temple Mount but was deemed unsafe and closed by the Jerusalem municipality this week.

Jordan has warned Israel that it should not make any changes to the bridge without first consulting Palestinian authorities. The settlers were warning Jordan not to involve themselves in matters concerning the Temple Mount.

While the rabbinate in Jerusalem has not yet commented on Tuesday's attacks, several senior rabbis warn they are indicative of a rise in religious extremism that threatens to destroy the Zionisit movement in Israel. In a similar attack in September, extremists broke into an Israeli army base near Nablus and cut the cables of 12 army vehicles.

Mosheh Lichtenstein, a prominent Israeli rabbi, claims this surge in violence can be understood as an expression of mounting frustration with a government decisions to withdraw from sections of Judea and Samaria but is both immoral and counter-productive.

"We believe we have a right to be here but that right must be won through moral means," Lichtenstein said. "I am very concerned by this violence, which runs against Jewish ethics."

Yaakov Peri, formerly head of the Israeli intelligence agency Shin Bet, says that moral judgments aside, unless dramatic actions is taken by the the government, army and intelligence to address this trend, extreme settler groups may drive Israel towards religious conflict. For this reason, he claims Jewish extremists now pose a greater threat to Israeli security than terrorism.

"An active terrorist is relatively easy for intelligence forces to find and stop. But when you are burning a mosque or cutting down olive trees, using weapons bought from any grocery store, it makes the job of the intelligence services much more complicated", he said. "[This violence] is becoming so extreme and so dangerous I am afraid it will become a religious war."


http://www.guardian.co.uk/world/2011/dec/13/israeli-military-attack-jewish-extremists

[StephanieVanbryce]

Israel TV Station’s Troubles Reflect a Larger Political Battleground


Channel 10 anchor Yaakov Elon in the station's studio minutes before the start of the daily evening news in Tel Aviv on Monday.

By ETHAN BRONNER December 26, 2011

JERUSALEM — An Israeli television station reported last spring on numerous trips Benjamin Netanyahu had taken as an elected official to Paris, London and New York before becoming prime minister in 2009. Accompanied by his wife, he flew first class and stayed in baronial hotel suites. Mrs. Netanyahu had her hair styled and her wardrobe dry-cleaned. The bills, displayed on screen, were paid for by wealthy friends.

Traveling in luxury at the expense of others may violate public service rules and the law. It also doesn’t look good. But instead of accolades for its journalism, Channel 10 is now fighting for its life, and Mr. Netanyahu’s hostility toward it is being cast as part of a broader cultural and political war in Israel between the left and the right involving efforts to control the judiciary, the reporting of news and public discourse.

It is a battle that most immediately pits the rightist governing coalition against the liberal elite as the government refuses to postpone the station’s debt, which could force it to close.

“The fight over Channel 10 is partly a matter of revenge — Netanyahu wants to make them pay for what they did to him,” argued Nachman Shai, a member of Parliament from the opposition party Kadima, a former news executive who helped set up Channel 10 a decade ago. “But it is also part of a three-front struggle — over the courts, civil society and the media. The right wants to control every institution. Freedom of expression is at risk.”

Those around Mr. Netanyahu, who filed a million-dollar libel suit against the station, says Channel 10 is a failed business whose payments have been forgiven numerous times and is hiding behind political complaints and inflated concerns about free speech to make the public absorb its debts.

On its face, the request by Channel 10 is modest. It owes $11 million, most of it to an official regulatory body, the rest in taxes. Ayelet Metzger, deputy director general of the regulatory body, said both her agency and the Finance Ministry had agreed to postpone the debt for a year.

But a parliamentary committee voted against doing so earlier this month. Mr. Netanyahu’s coalition obliged its members to vote no. This means that Channel 10 will, in theory, shut its doors at the end of January, when its 10-year franchise ends.

In practice, there will be a drawn-out battle to save it because of the belief that it plays a vital role in public debate through its crusading investigative news broadcasts. The only other independent station is Channel, 2, which is also facing economic woes.

Otherwise, Mr. Netanyahu has strong influence over other media outlets: state-owned Channel 1, State Radio and a freely-distributed and successful newspaper, Yisrael Hayom, owned by a close American friend, the billionaire Sheldon Adelson.

President Shimon Peres has weighed in, saying that the channel’s effort to survive is “a struggle for Israel’s democratic character.” In a related comment, he also declared himself “ashamed” of several bills being considered in Parliament that he believes chip away at Israel’s democratic character — an antidefamation law, one that silences loudspeakers issuing the Muslim call to prayer and another that prevents foreign governments from financing left-wing Israeli groups. [ http://www.nytimes.com/2011/11/14/world/middleeast/israeli-government-backs-financing-limits-for-nonprofit-groups.html?scp=2&sq=bronner%20nonprofit%20israel&st=cse ]

Last summer, Parliament passed a law making it possible to sue anyone who advocates boycotting things Israeli, including West Bank settlements.

Channel 10 infuriated the Netanyahus over the accusations of lavish travel and spurred a continuing investigation by the state comptroller. But the channel also angered previous leaders, playing a key role in exposing the way the 2006 Lebanon war was conducted and publicizing suspicions of corrupt land deals in the family of former Prime Minister Ariel Sharon.

It brought to the screen the fate of a Palestinian doctor in Gaza whose three daughters were killed in the 2008-9 war there by Israeli forces and showed a minister from the nationalist party Yisrael Beiteinu arriving at the home of a woman suspected to be his mistress and leaving the house the next morning.

“I believe that if we die, the message will be clear that if you have the guts to open a critical news company, you will go bankrupt,” said Raviv Drucker, the station’s chief investigative reporter, who broke the story of Mr. Netanyahu’s travels.

An executive of Channel 10 who spoke on the condition of anonymity said that he had been told by a top aide of Mr. Netanyahu that if Mr. Drucker were given a long vacation, postponing the debt would be a lot easier. Mr. Netanyahu’s office said no such conversation had occurred.

In previous years, Mr. Netanyahu actually intervened to save Channel 10 twice because, he said, he favors increasing broadcast outlets to expand the marketplace of ideas and debate. The Israeli news media, he and his aides complain, lean to the left and what the country needs is an Israeli version of Fox News.

Some say that is what Mr. Netanyahu thought he was helping to create when about five years ago he persuaded his friend, the American billionaire Ronald S. Lauder, to invest in the ailing Channel 10. But the structure of the channel makes it hard for owners to intervene in content.

Nonetheless, after the broadcast on Mr. Netanyahu’s travels was shown, the prime minister cooled his friendship with Mr. Lauder. Mr. Lauder declined comment.

Another owner of the channel is the Hollywood producer Arnon Milchan. The third and largest shareholder is Yossi Meiman, an Israeli political liberal who has faced financial difficulties because of his investment in a gas pipeline from Egypt which has been repeatedly blown up since the Egyptian revolution.

Amnon Dankner, former editor of the newspaper Maariv and a veteran journalist, said that the threat to Channel 10 worried him deeply.

“For the first time, I fear the end of critical and investigative news as we have known it in Israel,” he said. “If Channel 10 closes, Channel 2 will grow tamer. Since childhood I have felt that freedom of the press was marching forward here. Now I feel it is retreating.”

But other journalists say the only thing that has changed is who is in power. Prime ministers from the Labor Party like David Ben-Gurion, Golda Meir and Yitzhak Rabin also held the press tightly, meeting with senior editors regularly.

“When the prime minister was ‘one of us,’ it seemed totally natural for him to silence his critics,” Ari Shavit, a columnist for the newspaper Haaretz wrote in Thursday’s issue.[] “After 30 years of the media running roughshod over Likud, Likud is tyrannizing the media.”

Nahum Barnea, the main political columnist for the newspaper Yediot Aharonot, said that while the Channel 10 problem was about a failed business, it was part of the struggle for control of public discourse in Parliament.

“Many of the proposed laws have a common denominator,” he said. “People in the coalition think it is time for them to change the rules — the rules regarding the Palestinians, the Arab sector in Israel, the left and the media. The Channel 10 story is part of that. And if we are left with only one commercial channel, we will be a weaker democracy.”

http://www.nytimes.com/2011/12/27/world/middleeast/struggle-of-israels-channel-10-tied-to-political-wars.html?ref=middleeast