The documents reference serious allegations of corruption and voter registration fraud by ACORN as well as the Obama administration's decision to shut down a criminal investigation without filing criminal charges.

A federal appeals court in San Francisco upheld the use of the words "under God" in the Pledge of Allegiance and "In God We Trust" on U.S. currency, rejecting arguments on Thursday that the phrases violate the separation of church and state.

When President Barack Obama's jobs bill passed the House in early March, it contained a little-noticed provision to recover part of its $35 billion price tag by cracking down on offshore tax evasion, which costs the US some $100 billion a year in lost revenue. The provision, which requires foreign financial institutions to report more data to the Internal Revenue Service, was likely prompted by a 2008 Senate investigation that revealed the systemic efforts made by Swiss bank UBS to help moneyed Americans hide massive sums from the IRS.

The insider information that formed the backbone of the investigation—insight that eventually helped the feds recover billions in unpaid taxes—was provided by a former midlevel executive at UBS, American-born Bradley Birkenfeld. Birkenfeld is the only international banker who has ever blown the whistle to the US government on Switzerland's legendarily secretive banking practices. He is also the only person connected to UBS' massive tax evasion scheme to have been sent to prison: Birkenfeld is currently serving a four-year sentence for fraud. Whistleblower advocacy groups warn that this punishment could have a "chilling effect," discouraging other financial whistleblowers from coming forward. Did Obama's Department of Justice (DOJ) exact retribution that could cost US taxpayers billions?

Birkenfeld first raised alarms about UBS' banking practices in a series of emails to his superiors in 2005, after a colleague allegedly brought to his attention a year-old memo that forbade soliciting Swiss banking services while either the banker, client, or prospect were on American soil. "When I read it," Birkenfeld said in an October 2007 Senate deposition, "I was very concerned about what was going on in the bank because this contradicted entirely what my job description was." From at least 2001 until he resigned from UBS in 2005, Birkenfeld had worked to help rich people hide millions in taxable assets from the US government. Birkenfeld claims he only realized that what he was doing was criminal after reading the memo.

Two years later, Birkenfeld began providing the US government a cache of UBS internal documents, business emails, and insider knowledge. The US used this information to extract a plea agreement from the Swiss government and UBS, in which the bank agreed to pay a $780 million penalty and to release the names attached to 4,450 of its 19,000 undisclosed US accounts. Those accounts hold a significant portion of the estimated $20 billion in previously hidden assets held by UBS' US clients. This agreement, which is now pending in the Swiss parliament, could be a model for indicting other banks in offshore tax havens—countries with low (or no) taxes on banking assets, and strict secrecy laws to conceal the identity of their depositors. That is, provided the US can convince more whistleblowers with evidence of financial crimes to speak up.

In the wake of the Birkenfeld conviction, whistleblower advocacy groups say that's unlikely to happen anytime soon. Jesselyn Radack, the national security director at the Government Accountability Project, says that her organization has been in contact with at least four financial whistleblowers—including clients and employees of major Swiss banks—that "saw what happened to [Birkenfeld] and are not going to come forward." She adds, "I can't in good conscience tell someone to go to the government given its treatment of Birkenfeld." When Birkenfeld was locked up, whistleblower advocates mounted a campaign to commute his sentence—which they referred to as "an American tragedy" and "a disgraceful miscarriage of justice." Stephen Kohn, the director of the National Whistleblowers Center, says the message sent by the US government was: "If you come forward, you will go to jail and have your life ruined."

But the story is a bit more complicated than that. Birkenfeld wasn't indicted simply because he was involved in the illegal activities at UBS that he helped expose. The primary reason was his failure to disclose in his initial June 2007 meetings with DOJ the longstanding relationship he had with a former client named Igor Olenicoff, a billionaire real estate developer then on trial for tax evasion. In April 2008, Olenicoff was sentenced to work 120 hours of community service, put on two years probation, and forced to pay a $52 million fine for dodging $7.2 million in taxes.

The DOJ argues it could have won a harsher judgment against Olenicoff had Birkenfeld been more forthcoming. In May 2008, when the DOJ claims to have first discovered the connection between the banker and billionaire, it charged Birkenfeld with conspiracy to defraud the US government. During his trial, Birkenfeld pled guilty and admitted to, among other things, smuggling diamonds into the US in a toothpaste tube for Olenicoff. "Oh, it was just a way of carrying them so I wouldn't lose them," Birkenfeld told 60 Minutes. "Where would you put two diamonds?"

In a letter to Attorney General Eric Holder asking him to reconsider Birkenfeld's case, his attorneys argue that because he mentioned his relationship with Olenicoff to Senate investigators, as well as other inquiries that were being conducted by the IRS and Securities and Exchange Commission, Birkenfeld was not trying to shield his client from the law. They also contend that Birkenfeld would have been more forthcoming had he been offered the full immunity from prosecution that he'd requested. That explanation didn't wash with Holder. The attorney general's office, which did not directly respond to Birkenfeld's complaints, said in a written statement that his case had been "carefully considered" by the district court.

Gerald Lefcourt, the former president of the National Association of Criminal Lawyers, agrees with Holder. "The Senate is politics," he explained. "What's important is making a deal with the US attorneys…the other stuff is icing on the cake." Lefcourt adds that the sentence simply indicates the DOJ's low tolerance for witnesses who are not entirely cooperative. Notorious mafia informant Sammy "the Bull" Gravano "got five years for 19 murders," he points out. "It's in the public interest to see that if you cooperate, you will get just rewards."

But even taking into account Birkenfeld's failure to be fully frank with the DOJ, the whistleblower groups contend that he got a disproportionately harsh punishment. Judge William Zloch of Florida's Southern District Court handed him a sentence 10 months longer than the 30 months the prosecution had requested.

Whistleblower advocates say there's one thing the government could do to encourage other Wall Street insiders, accountants, or corporate financial officers to expose fraud: Cut Birkenfeld a big check. Under an IRS whistleblower reward program, informants are eligible for 15 to 30 percent of the collected tax proceeds resulting from any details they provide on a scam that they weren't directly involved in creating. But the program hasn't awarded a payout since it was created in 2006. Kohn of the National Whistleblowers Center is one of two lawyers representing Birkenfeld in his application for the award (and may earn a sizeable cut of the reward if it's successful). The Government Accountability Project’s Radack, a Bush-era whistleblower profiled by Mother Jones, noted that a payment from the IRS "could hopefully defrost the current chill on whistleblowers coming forward."

The idea of imposing a lighter punishment—or making a hefty payout—to someone who has admitted breaking the law may sound distasteful. But the economic crisis has illustrated that there's no shortage of financial malfeasance to be uncovered, and as Birkenfeld has shown, just one whistleblower can make a big difference. There's no way to know whether the DOJ is working with other informants behind the scenes—but if it eventually turns out that Birkenfeld's prison sentence did dissuade more financial whistleblowers from coming forward, then he may be one fraudulent banker who didn't belong behind bars.

2 Comments | Post Comment     

Sen. Al Franken will be headlining Netroots Nation, the annual progressive bloggers conference. This year’s event runs July 22–25 in Las Vegas.

Republican strategist Karl Rove acknowledged last night that he isn't the most popular guy in politics these days -- but he's not the only one.

Scott Brown--the new star Republican Senator--was accused of harassing a female campaign worker in 1998. Did the Democrats blow an opportunity to keep their 60th Senate seat?

Chefs Call Proposed New York Salt Ban 'Absurd', MyFoxNY Fox 5 News WNYW:More Liberal big brother control proposed. What's next, National ID cards? Oh wait.

Even staunch conservatives lately have been calling Liz Cheney out for going too far: calling the DOJ the "Department of Jihad" for having the poor judgment to provide legal defense to Gitmo prisoners. (So much easier to just drown them.) Ken Starr and Lindsay Graham have been trying to distance themselves from the Cheneys, explaining that legal representation is an essential part of the US criminal justice system. I remember Liz and Dick in that brilliant film version of "Who's Afraid of Virginia Woolf?" They played a twisted, foul-mouthed couple in a spectacular insult marathon. You can't look...and you can't look away.

No Comments | Post Comment     

//Here are the variables used by the MJ_media_tags function: // CLSID, CODEBASE, ObjectID, WIDTH, HEIGHT, URL, QUALITY, BGCOLOR, PLUGINSPAGE MJ_media_tags("clsid:D27CDB6E-AE6D-11cf-96B8-444553540000", "http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=6,0,40,0", "fiore", "525", "440", "/files/majority_player.swf", "high", "#FFFFFF", "http://www.macromedia.com/go/getflashplayer");

This cartoon requires Macromedia's Flash Player. If you don't see the cartoon above, download the player here.

Mark Fiore is an editorial cartoonist and animator whose work has appeared in the Washington Post, the Los Angeles Times, the San Francisco Examiner, and dozens of other publications. He is an active member of the American Association of Editorial Cartoonists, and has a web site featuring his work.

1 Comment | Post Comment     

Sarah Palin's new memoir is hardly the first to stir controversy ...

House Democratic leaders banned Wednesday the practice of doling out multimillion-dollar, no-bid contracts to private contractors, a move that will shake up the lobbying industry that has come to rely on securing these so-called earmarks for their corporate clients.

Government investigators can't find the Bush lawyer's emails. His explanation makes about as much sense as his legal rationale for torture.

On the afternoon of September 24, 2009, Pennsylvania State Troopers, their guns drawn, broke down the door of room 238 of the CareFree Inn on the outskirts of Pittsburgh. The troopers were acting on a search warrant related to protests planned for the G20 summit—a meeting of the heads of state of the world's major economies. Thousands of protesters had descended on the city, presenting demands ranging from curbs on carbon emissions to the outright abolition of capitalism.

Anticipating hordes of black-masked, Starbucks-smashing anarchists, the Pittsburgh police and the Secret Service coordinated nearly 4,000 law enforcement officers, outfitting them with the latest in riot-dispersal technology. Crowds marching on the summit were met with pepper spray, stun grenades, and—for the first time on US soil—acoustic cannons that blast painful sounds as far as 1,000 feet. But the protesters had their own crowd-control methods, and that's what had brought the state troopers to the CareFree Inn.

What they found when they broke down the door were a couple of middle-aged housemates from Queens, New York. Elliott Madison sat at a desk with a laptop and a cell phone. A police scanner lay nearby. Michael Wallschlaeger was at the minifridge grabbing some hummus when the police rushed in. According to the criminal complaint filed against them, the two men had been "communicating with various protestors, and protest groups...[via] internet based communications, more commonly known as 'Twitter'. The observed 'Twitter' communications were noted to be relevant to the direction of the movement of the Protestors...in order to avoid apprehension..."

Continue Reading »

8 Comments | Post Comment     

Connie Saltonstall of Charlevoix said today she plans to run against Stupak for the Democratic nomination of Michigan’s First Congressional District, citing Stupak’s efforts to stop health care reform if it doesn’t ban use of government money for abortions. Stupak, a former state trooper from Menominee, has held the seat since 1993.

U.S. Supreme Court Chief Justice John Roberts said Tuesday the scene at President Obama's State of the Union address was "very troubling" and the annual speech has "degenerated to a political pep rally." Obama chided the court, with the justices seated before him in their black robes, for its decision on a campaign finance case.

This story first appeared on the ProPublica website.

The Supreme Court recently freed corporations to spend more money on aggressive election ads. But if businesses take advantage of this new freedom, the public probably won't know it, because it's easy for them to legally hide their political spending.

Under current disclosure laws for federal elections, it's virtually impossible for the public to track how much a business spends, what it's spending on, or who ultimately benefits. Experts say the transparency problem extends to state and local races as well.

"There is no good way to gauge" how much any given company spends on elections, said Karl Sandstrom, a former vice chairman of the Federal Election Commission and counsel to the Center for Political Accountability. "There's no central collection of the information, no monitoring."

Companies invest in politics to win favorable regulations or block those "that could choke off their business model," said Robert Kelner, chairman of Covington & Burling's Washington, D.C., political law group. But they'd rather hide these political activities, he said, because they fear backlash from customers or shareholders.

Continue Reading »

1 Comment | Post Comment     

A North Dakota man on Tuesday pleaded guilty to threatening to kill President Barack Obama.

This story first appeared on the TomDispatch website.

Hubris? We're bigger than that! 

We've now been at war with, or in, Iraq for almost 20 years, and intermittently at war in Afghanistan for 30 years. Think of it as nearly half a century of experience, all bad. And what is it that Washington seems to have concluded? In Afghanistan, where one disaster after another has occurred, that we Americans can finally do more of the same, somewhat differently calibrated, and so much better. In Iraq, where we had, it seemed, decided that enough was enough and we should simply depart, the calls from a familiar crew for us to stay are growing louder by the week.

The Iraqis, so the argument goes, need us. After all, who would leave them alone, trusting them not to do what they've done best in recent years: cut one another's throats?

Modesty in Washington? Humility? The ability to draw new lessons from long-term experience? None of the above is evidently appropriate for "the indispensable nation," as former Secretary of State Madeleine Albright once called the United States, and to whose leaders she attributed the ability to "see further into the future." None of the above is part of the American arsenal, not when Washington's weapon of choice, repeatedly consigned to the scrapheap of history and repeatedly rescued, remains a deep conviction that nothing is going to go anything but truly, deeply, madly badly without us, even if, as in Iraq, things have for years gone truly, deeply, madly badly with us.

Continue Reading »

No Comments | Post Comment     

Senate Staffers Warned to Stay Clear of Drudge. Maybe responsible for the many viruses?

Facing razor-thin margins in the House, Democratic leaders are hoping to convert the sole liberal who opposes their health care bill, but it seems they have their work cut out because he isn't budging.