Vivienne Walt lives in Paris and has written for TIME since 2003, from dozens of countries around the Middle East, Africa, and Europe.Greenwald on Snowden Leaks: The Worst Is Yet to Come
- By Vivienne Walt / Rio de Janeiro @vivwalt October 14, 2013
Although four months have passed since Edward Snowden’s explosive NSA surveillance leaks, the most revealing details have not yet been published, and could be rolled out in the international media over the coming weeks and months, beginning with U.S. spying activities involving Spain and France. That’s according to Glenn Greenwald, the Guardian journalist who broke the Snowden story last June, and whose life has been drastically upturned since. “There are a lot more stories,” he said on Monday in Rio de Janeiro, where he lives. “The archives are so complex and so deep and so shocking, that I think the most shocking and significant stories are the ones we are still working on, and have yet to publish.”
Greenwald was speaking in a packed university gymnasium to hundreds of journalists, who are gathered here this week for the Global Investigative Journalism Conference, a two-yearly event that rotates around the world, bringing together writers, television producers and editors to share information and collaborate on work. Here, Greenwald was something of a hero — the entire thrust of the conference centers on ferreting out secrets and wrongdoing—and the journalist received a rock-star welcome. And while Rio was chosen as the location for the conference years ago, it proved a fortuitous spot. Greenwald recently revealed on Brazil´s hugely popular Globo TV that the NSA had spied on President Dilma Rousseff, as well as the government oil company Petrobras. The news caused a furor in Brazil, not least from Rousseff herself, and she canceled a White House visit, originally scheduled for next week.
But in an hour-long discussion on stage with a Dutch journalist, Greenwald suggested that his life was now immensely complicated. A New York lawyer before turning into a high-profile blogger in 2005, he revealed that he was in daily contact with Snowden—a fact that came as a surprise to most in the audience—in what is an active collaboration to sift through the mountain of documents Snowden carried out of the U.S. Snowden contacted Greenwald and U.S. filmmaker Laura Poitras after taking the information to Hong Kong.
Snowden, who had top-level U.S. security clearance, spent a month in Moscow Airport’s transit area until Russia granted him asylum; the U.S. has indicted him for stealing state secrets and exposing them, charges which would likely land him in jail for the rest of his life.
In addition to his contact with Snowden, Greenwald said he was in daily communication too with Poitras, who is based in Berlin, continuing to dig into what Greenwald says is “thousands and thousands of documents.” The challenge of sifting through the information is now itself a risky endeavor. “We go to extreme lengths to make sure our communication is protected,” he said.
The work has made Greenwald himself a possible target of investigation, and he intimated that returning home to the U.S. would not be simple. British police detained his partner David Miranda at Heathrow airport in August, seizing computer hard drives, as Miranda was switching planes from Berlin, where he’d met Poitras. “We spent yesterday cloistered with British lawyers in a conference room, for the lawsuit against British authorities for detaining him for what amounted to 11 hours,” Greenwald said.
But the truly drastic impact has been on Snowden’s life, of course. And in a long discussion, Greenwald outlined how Snowden’s options for asylum had quickly shrunk after he left Hawaii in early June. Snowden flew initially to Hong Kong, where he made contact with Poitras and Greenwald. The two flew to that city, a Chinese special administrative region governed mostly by its own laws, to meet him.
Greenwald said he and Poitras locked Snowden in a room in Hong Kong for six hours after they arrived to meet him in order to “relentlessly interrogate him,” and to make sure that they were not being set up, or that the documents were not fake. Greenwald said the two were also anxious to ensure that Snowden, just 29 at the time, grasped the permanent impact on his future of exposing state secrets—and of insisting to the journalists that they publish his name. “We spent the bulk of that first week making sure he really understood what the implications were of revealing himself,” Greenwald said.
When it become clear that Hong Kong would not grant Snowden protection from U.S. authorities, he tried to reach Ecuador through Moscow and Cuba, but was stuck after the U.S. canceled his passport. Still, Greenwald said governments who had considered taking in Snowden had made no real effort to do so. “Venezuela could send a jet to Moscow any time to pick him up, but never did. Ecuador the same way,” he said.
So, is Snowden happy in exile in Russia, whose government has itself conducted widespread surveillance programs and routinely cracks down on subversive journalists? Greenwald replied: “Happy, in the sense that if the alternative is a cage in the U.S. for the rest of your life, then Russia looks a lot better.”
Vivienne Walt lives in Paris and has written for TIME since 2003, from dozens of countries around the Middle East, Africa, and Europe.Home owner Pulls Gun To Stop New Electric "Smart Meter" From Being Installed
FAIR USE NOTICE: This video may contain copyrighted material. Such material is made available for educational purposes only. This constitutes a 'fair use' of any such copyrighted material as provided for in Title 17 U.S.C. section 107 of the US Copyright Law.
Video: GTA homeowner liable for damage after smart meter catches fire
A GTA resident recently came home to find his hydro smart meter fully engulfed in flames. Kevin Zeller soon found out he was responsible for most of the hardware used by Hydro One and was slapped with a bill for $5,000.
Smart Meters: Total Technocratic Takeover and the Negative Health Effects
Transparency advocate Josh del Sol takes us on a journey of revelation and discovery, as we question corporate practices of surveillance, extortion and causing harm in the name of "green". What you discover will surprise you, unsettle you, and will hopefully inspire you to challenge the status quo. It is time for all of us to take back our power.
Smart grid's shortcomings exposed - Must Take Back Your Power
Utility companies are replacing electricity, gas and water meters worldwide with new generation "smart" meters at an unprecedented rate. Take Back Your Power is a crowd-funded, public awareness documentary that investigates the benefits and safety of this ubiquitous "smart" meter program. Using insight from insiders, expert researchers, politicians, doctors, and concerned citizens, environmental steward Josh Del Sol takes us on a journey of revelation and discovery, as he questions corporations' right to tap our private information in the name of "green". What you discover will surprise you, unsettle you, and inspire you to challenge the status quo.
Our final trailer is trending #5 on USA Today's homepage right now. Help propel TBYP to the top rung of social awareness... invite your friends to our FB page, and SHARE this article:
Take Back Your Power, a new film from transparency advocate Josh del Sol, investigates the benefits and risks of the ubiquitous "smart" grid program. The film carries deep insight from insiders, expert researchers, politicians, doctors, and concerned communities from all around the world who are saying NO to smart meters. Del Sol questions corporations' right to tap our private information and erode our rights in the name of "green."
After an epic 22-month journey, this film has evolved into something we are truly proud to be a part of. We need your help to get Take Back Your Power seen by everyone. Not surprisingly, we cannot rely on the mainstream media, the gatekeepers for the criminal elites to get this film out. It is up to us, the community, to share the vital and empowering information contained in this film, everywhere possible, as quickly as possible. Spread the word - protect your home and know your rights.
We are grateful to be on the journey of truth discovery with you. When one can see the light at the end of the tunnel and help others become aware, life becomes thrilling.
“The greatest pleasure in life is doing what people say you cannot do.” -Walter Bagehot
After Fraud, Regulators Go After a Bank - A government action against TD Bank, brought in connection with a customer's Ponzi scheme, is noteworthy and rare
- By FLOYD NORRIS - October 3, 2013 - The New York Times
You can’t run a Ponzi scheme without a bank.
In such a scheme, money that is supposed to be invested is really used to line the pockets of the Ponzi promoter or to pay previous investors. A lot of money has to flow through bank accounts, and it flows in ways that differ from what the promoter tells investors is happening. Banks are in a unique position to notice what is going on before the money is all gone.
But it is extremely rare for a bank to face sanctions for not noticing.
The typical judicial attitude was expressed last year when the United States Court of Appeals for the 11th Circuit upheld the dismissal — before a trial or any discovery of evidence - of a class-action suit against Bank of America by investors who had lost money in a pyramid scheme run by a promoter named Beau Diamond.
Even assuming that the plaintiffs could prove that Mr. Diamond “engaged in atypical business transactions, such as numerous wire transfers unrelated to any legitimate business activity,” the appellate court ruled, that would not be enough. The allegations in the suit were insufficient to render “plausible” a conclusion that the bank had “actual knowledge” of what Mr. Diamond was doing, so there was no need for a trial.
See no evil, face no liability.
That is why a joint regulatory action filed last week by the Securities and Exchange Commission, the Office of the Comptroller of the Currency and the Financial Crimes Enforcement Network, a part of the Treasury Department, seems so noteworthy. TD Bank, an American subsidiary of Canada’s large Toronto-Dominion Bank, agreed to pay $52.5 million to settle accusations that it had helped a Florida lawyer named Scott W. Rothstein commit one of the more brazen Ponzi schemes of recent years.
It is not clear, however, whether this represents a new attitude on the part of regulators to try to force banks to pay attention to possible Ponzi schemes - just as the Patriot Act requires them to monitor possible terrorist financing - or whether it is an isolated response to a particularly egregious case. Certainly the regulators had evidence, much of it provided by Mr. Rothstein in an effort to minimize his sentence, suggesting that one or more bank employees knew they were helping him deceive investors.
If regulators do not go after banks, the banks are usually home free. Some bankruptcy trustees for collapsed Ponzi schemes have tried to sue banks to recover money for defrauded investors only to have judges rule that because the trustee is standing in the shoes of the fraudster, such suits are not permitted. But when investors try to sue the banks, they can run up against rules limiting class-action suits and a Supreme Court decision saying that only the government - not victims - can bring suits contending that a bank, or anyone else, aided and abetted a fraud.
The Rothstein Ponzi scheme was created by a lawyer who had burst onto the Fort Lauderdale scene, living large and making highly publicized charitable donations. His firm, Rothstein, Rosenfeldt & Adler, employed 70 lawyers. He was vice chairman of a Florida Bar Association grievance committee that heard ethics complaints against lawyers. He was named to a committee to advise on state judicial appointments.
And he put together a $1.2 billion Ponzi scheme, according to the federal charges to which he pleaded guilty.
His scheme involved persuading investors to put money into “structured settlements.” Supposedly, these were settlements of cases that involved complaints like sexual harassment. The companies, he explained, had agreed to pay money over time to his clients in return for their silence. Those clients would sell the right to the payments in return for an upfront payment from the investor. He assured the investor that all the money had in fact been paid into escrow accounts he administered.
He spread the profits of the Ponzi scheme around, according to the federal charges, using money to “provide gratuities to high-ranking members of police agencies in order to curry favors with such police personnel and to deflect law enforcement scrutiny.” Political contributions were made with the money “in a manner designed to conceal the true source of such funds and to circumvent state and federal laws governing the limitations and contribution of such funds.” He sponsored fund-raisers for, among others, Gov. Charlie Crist, Senator John McCain and President George W. Bush.
For their first wedding anniversary, in 2009, he and his wife, Kimberly, attended an Eagles concert, where Don Henley dedicated a song, “Life in the Fast Lane,” to them. That cost him a $100,000 charitable contribution.
He kept a lot of the money for himself. After he was arrested, the government seized his car collection, which included four Mercedeses, three Ferraris, three Corvettes, two Rolls-Royces, one BMW, one Bentley, one Hummer, one Cadillac, one Bugatti, one Maserati, one Lamborghini and one Ford.
And he couldn’t have done it without the help of his bank.
At the time the Ponzi scheme began, he was using a small bank, Gibraltar Private Bank and Trust. He later testified that he had “protection” from officers at that bank but that he was upset by the “amount of scrutiny we were getting from certain due diligence folks” at the bank’s headquarters. And as he began to persuade large investors, including hedge funds, to invest, some of them wanted him to use a larger bank to protect themselves from a possible bank failure while the bank held the money.
So he moved to Commerce Bank, which was later acquired by Toronto-Dominion. The Canadian bank kept Commerce’s slogan, “America’s most convenient bank.” Its systems generated warnings of suspicious activity, but the bank ignored them, thanks to an extremely cooperative bank officer, Frank A. Spinosa.
According to an S.E.C. suit filed against him last week, Mr. Spinosa falsely assured investors that only they could get money from accounts that he said held millions.
Mr. Spinosa’s lawyer, Samuel J. Rabin Jr., says his client “did not know about the fraudulent conduct perpetrated by Scott Rothstein” and “never purposefully acted in any way to advance Scott Rothstein’s many schemes.” In an interview, he painted his client as a salesman who did favors for an important customer who promised to introduce him to other people who could become big customers of the bank.
TD Bank initially disclaimed any responsibility, and it bitterly fought a suit filed by Coquina Investments, which lost more than $30 million in the scheme. The bank is appealing a jury verdict that ordered it to pay Coquina $67 million in damages, including $35 million in punitive damages. Mr. Spinosa cited his Fifth Amendment right against self-incrimination in refusing to testify in that case.
It later turned out that lawyers for TD had withheld evidence in the case and misled the judge in a number of instances. As punishment, the judge ordered the bank to pay Coquina’s legal fees.
The bank has since settled other cases filed by victims. Altogether, the mess has cost it $500 million, according to a report in The South Florida Business Journal, although the bank declined to confirm the figure. As a result of the bank’s payments, said Jordan Maglich, a Florida lawyer whose blog, Ponzitracker.com, follows such cases, “This is the first time I can recall that victims are getting 100 percent of their money.”
Mr. Rothstein is serving a 50-year prison sentence, and eight others have been sentenced to prison terms. Other cases are pending and Mrs. Rothstein will be sentenced next month after pleading guilty to charges she tried to hide $1 million worth of jewelry, including a 12-carat diamond ring, from federal marshals seizing her husband’s assets. She is expected to receive a prison sentence.
TD Bank says it has improved its procedures, which certainly seems appropriate. Perhaps, even if this case does not herald a wider crackdown by authorities, it will persuade other banks that ignoring signs of a Ponzi scheme is no longer a safe thing to do.
Floyd Norris comments on finance and the economy at nytimes.com/economix
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