Showing posts with label Investigation. Show all posts
Showing posts with label Investigation. Show all posts

Obama’s Team Clears Itself With Own Investigation. [So Why Doesn’t An Accused in Court Have The Same Right?]

12/24/2008 02:39:00 AM

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gm081219Isn’t it just so convenient that the date dictated by Patrick Fitzgerald for releasing the results of the internal investigation on  Obama’s Team just happen to fall at a time that is most convenient for trying to contact people,?

Rahm Emanuel took a flight to Africa today  to take his family on safari, before the Obama Team released their report on the Illinois senate seat investigation.

According to the report, Obama’s attorney cleared the team of wrong-doings by their inside investigation regarding the Illinois senate seat.

Whew!  Obama’s Team found no evidence against Obama’s Team.  I worried that the Obama Team just might get the Obama Team in trouble!  And I was scared that someone on the Obama Team might just admit readily that they did speak to Blago or his office on the Senate seat.  Such a good thing that all politicians tell the  truth 100% of the time since Obama is looking at our hearts, confirming that we have always had the best intentions and that he is loyal to the American people..  There’s nothing to see here… move along!  And if you do have anything to say about it, then you a racist, homophobic, misogynistic, Islamapohibic or is generally an awful human being.  And don’t ask Obama about it, because then you are just having some fun with it, bring up the past.  Time to publically chastise you… and pay no attention to the little man behind the curtain.

Okay, time to end the sarcasm.  Since when does the party being investigated also do the investigating?  Meanwhile, the AP reported:

An internal review prepared for President-elect Barack Obama says his incoming chief of staff had multiple conversations with Illinois Gov. Rob Blagojevich’s office, but no one close to Obama suspected that the governor might be trying to sell Obama’s Senate seat as prosecutors allege.

The report was released Tuesday as an Obama transition official confirmed that Obama and two of his top aides, Rahm Emanuel and Valerie Jarret, have been interviewed in connection with the federal investigation into Blagojevich.

Incoming White House attorney Greg Craig, who conducted the internal review at Obama’s request, found that the president-elect had no contact with Blagojevich or any of his staff about the Senate seat he vacated to take over the presidency.

Looking at the report that was released by the Obama Team, the review of contracts with Rod Blago will show that Rahm Emanuel had only “one or two” phone conversations with Blago.  The Chicago Sun-Times reported that the FBI captured 21 tape-recorded conversations between Blago’s office and Emanuel.  However, the report does say that one Obama “friend” who is not employed in the transition effort DID HAVE a brief conversation about the subject with a member of Blago’s staff.  Isn’t that just convenient?

This contact, described as a “pro-forma” courtesy call, was allegedly when Emanuel reportedly gave Blago a “heads up” that he was accepting Obama’s offer of the chief of staff job, and as a result, would be resigning his congressional seat.  As of this date, Emanuel has still not resigned his seat although he is working full time on the Obama Team, thus still receiving taxpayers money for doing absolutely nothing.

And why would anyone need to call the Governor of Illinois when you are a US Representative?  Why do you need to tell a state governor such information? 

Additionally, the report stated that Emanuel had “about four telephone conversations with John Harris, Chief of Staff to the Governor, on the subject of the senate seat.  In these conversations, Mr. Emanuel and Mr. Harris discussed the merits of potential candidates and the strategic benefit that each candidate would bring to the Senate seat.”  So just thoughts to ponder, is the merits of a potential candidate based upon how much is in their bank account, and how much they have to offer from said bank account?

And what the main stream media isn’t reporting, is that Obama, Emanuel and Valerie Jarret were interviewed last week by federal prosecutors probing the Blago’ seat bid.

Additional thoughts to ponder are if there were no conversations between Obama or his team and Balgo’s office, then why was Blago so mad?  Based on taped conversations cited by prosecutors, suggested Obama wouldn’t be helpful to him and called him a “vulgar term.”  Told by two other advisers Blago had to “suck it up” for two years, the FBI says it heard Blago complain “he has to give his motherf***er, his Senator.  F*** him.  For nothing?  F*** him!” 

As for the Feds investigation, one member described in Fitzgerald’s complaint hinted that Blago was frustraited by contacts with Obama and his staff.  “Blago said he knows that the President-elect wants Senate Candidate 1 for the Senate seat, the complaint states, referring to an individual many believe to be Jarret.  And even if the governor were to appoint a candidate favored by the Obama team, Blago said, “they’re not willing to give me anything except appreciation.”

If Obama or anyone on the Obama Team did not have a conversation about the senate seat, then why does Blago have the attitude he does towards Obama?  The memo does not address the issue if anyone on Obama’s Team did know that Blago was trying to sell the seat, and if they did know, why did they not contact the authorities.

The Washington Post states:

The report helps explain the first part of the statement [about Obama wanting Senate Candidate 1 for the Senate seat"]  In his early conversations with the governor, Emanuel touted Jarrett as the best candidate, according to the Obama memo, before learning from Obama that he wanted to remain neutral on the subject.

“The President-Elect believed it appropriate to provide the names of multiple candidates to be considered, along with others, who were qualified to hold the seat and able to retain in a future election, Craig wrote.

But the report does not make clear why Blagojevich stated that he thought the Obama staff was “not willing to give me anything.”  It states that none of Obama’s staff ever suspected that the governor was seeking anything improper in exchange for the Seante Seat. […]

Emanuel offered six names as possible candidates after Jarrett withdrew hers to accept a job in the White House:  Reps. Jan Schakowsky and Jesse L. Jackson Jr.; Illinois Comptroller Daniel W. Hynes; Illinois Veterans Affairs Secretary Tammy Duckworth, a veteran of the Iraq war: Illinois Attorney General Lisa Madigan; and Chicago Urban League President Cheryle Jackson.

I would be very curious as to see what an outside attorney would find on the matter, especially considering that The New York Times reported last week that “Emanuel Had Contact With Governor’s Office on Senate Seat”.  And The Wall Street Journal is reporting today that “Emanuel, Blagojevich Aides Discussed Senate Seat.”

And according to the Chicago Tribune, another source said that contact between the Obama camp and the governor’s administration regarding the Senate seat began the Saturday before the Nov. 4th election, when Emanuel made a call to the cell phone of Harris.  The conversation took place around the same time press reports surfaced about Emanuel being approached about taking the position of Chief of Staff in Obama’s administration if Obama should win.

Emanuel delivered a list of candidates who would be “acceptable” to Obama, the source said.  On the list were Obama adviser Valerie Jarrett, Illinois Veterans Affairs director Tammy Duckworth, state Comptroller Dan Hynes and U.S. Rep. Jan Schakowsky of Chicago, the source said.

Sometime after the election, Emanuel called Harris back to add the name of Democratic Atty. Gen. Lisa Madigan to the approved list, the source said.

Blagojevich and Harris, who resigned his state post Friday, are charged with plotting to sell the selection of Obama’s replacement in exchange for lucrative jobs or campaign cash for the governor.

In the meantime, let’s all go back to pretending that Obama is “The One” and has nothing to do with the corrupt Chicago politicians that all know each other, all have worked with each other at one time or another, and all that got him where he is today.

Meanwhile Rahm Emanuel still remains a congressman from the 5th District of Illinois, while working full time on the Obama Team, receiving income for doing nothing with his congressional seat, and has skipped a vote, yet he’s still a lawmaker.  On Emanuel’s personal office website, the last press release was two weeks before the election on Oct. 14.  Meanwhile, Obama has resigned his position effective Nov. 16th, as U.S. Senator, leaving the position open.  Illinois Governor Blagojevich is accused of trying to sell Obama’s seat in Congress, and many wanted him impeached however, the court ruled against a trial.

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Someone Has A High Postage Bill. White Powder Envelopes Sent All Over The World.

12/18/2008 02:15:00 AM

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LetterSuspicious packages and envelopes are being received at all kinds of U.S. government offices around the world and here in the U.S.

Thirty six states have seen suspicious packages to National Guard facilities, forty governors offices have had suspicious white powder letters, fifteen U.S. embassies in Europe have received letters with white powder, and most have a Texas postmark. In October, Chase, the FDIC and a home loan company received similar letters with white powder, also with a Texas postmark.


  • Suspicious packages have been sent to National Guard bureaus and reserve facilities in 36 states.  An internal report from the Department of Homeland Security said 51 packages included anti-war compact discs, with one having a suspicious powder, found later to not be toxic.  All packages were postmarked from Tennessee and Oklahoma.

    In Draper, Utah at the National Guard’s headquarters, a package was received by a worker who “deemed the package suspicious because it matched the description contained in a security advisory received [Monday] from National Guard Bureau.”  The 85th Weapons of Mass Destruction Civil Support Team of the Guard was called to test the people in the mailroom at the time to make sure they weren’t exposed to any dangerous substances and to conduct tests on site.  Those field tests had negative results.  Later it was stated there was no white powder in that package according to one report, but according to several others, there was white powder in that package however, it was later found to be non-toxic.

    In recent days the 28th Division headquarters in Harrisburg, PA and another facility in Coraopolis have received suspicious mailings.  Those mailings were out of Memphis, TN.  Lt. Col. Chris Cleaver, public affairs officer for the PA National Guard said the package included a DVD, a picture of the flat at the remains of the World trade center and “other items.”
  • Fifteen U.S. embassies in Europe have also received letters containing a suspicious white substance, and tests have shown 14 of them to be harmless.  Test results from one has not yet been received.  Among the American embassies receiving the suspicious envelopes were those in Bern, Berlin, Brussels, Madrid, Oslo, Copenhagen, Stockholm, Riga, Paris, Rome, Bucharest and The Hague.  All letters were postmarked from Texas.
  • Forty governor's offices nationwide have also gotten the letters, which contain an unspecified note, that have been sent since October.  Letters have arrived in Alabama, Alaska, Arizona, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Indiana, Iowa, Kansas, Maine, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, North Dakota, Oklahoma, Pennsylvania, Rhode Island, South Carolina, South Dakota, Texas, Utah, Washington, Wyoming and West Virginia along with Puerto Rico and the Virgin Islands. [If I counted them correctly..]  The typewritten letters are “similar in nature” and makes some sort of threat, officials said.  All those letters were postmarked from the Dallas, Texas area, possibly San Antonio.  The FBI has declined to say if the letters are specifically addressed to each governor or written to a generic “governor’s office” address.

    In Nevada, there has been two letters received.  One was addressed to Gov. Jim Gibbon’s Las Vegas office, and the other, received the same day, was addressed to former Gov. Kenny Guinn in Carson City.  After two early tests at the Carson City Fire Department lab showed the possibility of anthrax, the FBI took the substance to a more sophisticated lab, with the third test showing the substance as harmless.  Two false-positive results also came back from the initial field tests in Vegas.  Both letters had a Texas postmark.

    In Pennsylvania, the letter bore a Dec. 8th postmark from North Texas.  Wayne Boulware, the worker who opened the letter, said the letter contained only one sentence, spelled out in capital letters:  “ARE YOU AL QAEDA?”

    In Maryland, ABC7/News Channel 8 reporter John Gonzalez learned that the substance in Annapolis was a protein additive.

    The Florida letter, interestingly enough, was addressed to former Governor Jeb Bush.

    The Alabama letter contained a “harmless food substance”, and Christopher Murphy, Alabama’s public safety director, said the letter received did not specifically target the Governor, but declined to elaborate on what it said.

    In Missouri, a chemical analysis by the state health lab found the powder appeared to be a bleached flour.  

    In Wyoming, the white powdery substance was found to be corn starch.

    In Hawaii, authorities had previous warned the governor’s office to be on the lookout for suspicious letters with a return address from San Antonio, Texas.  A clerk to the governor found a letter from San Antonio, and called security.  That letter was addressed to the current governor, Linda Lingle.  A test with a confidence rating of 98 percent indicated the substance inside the letter was cornstarch.

    The letter received by Utah did not have a post mark from Dallas, and declined to say exactly where it was from.
     
  • Additionally, in October, letters, many containing a suspicious white powder, were sent to many Chase bank offices, possibly more than 30, and two other financial institutions in several states and to the New York Times headquarters in New York. At the time, more than 45 threatening letters had been received at financial institutions in at least 11 states.  “Most of the letters contain a powder substance with a threatening communication,”  FBI spokesman Richard Kolko said.   Those letters warned “it’s payback time” according to the FBI.  FBI agent Mark White, spokesman for the FBI office in Dallas, said in October that in addition to the Chase banks, the Federal Deposit Insurance Corp. in Dallas and the U.S. Office of Thrift Supervision in nearby Irving, Texas, and the Federal Home Loan Bank in Atlanta, also received threatening letters and a white powdery substance.  

    letters102308b_500 In one of the letters, addressed to the JP Morgan Chase CEO, Jamie Dimon, threatened a series of attacks ending in an Oklahoma City-like bombing.  The writer accused Dimon of stealing WaMu, which JP Morgan recently took over.

    ABC News reported that the threat letters sent to Chase banks were all postmarked October 17 and 18, in Amarillo, Texas.letters102308_500

    The Times letter did not carry a Texas postmark and contained a different substance, according to the AP.
  • Similar scares have taken place at the Los Angeles and Salt Lake temples of The Church of Jesus Christ of Latter-day Saints and a Knights of Columbus building in Connecticut in November.  In all cases, the substance was found to be harmless.

     

    FBI spokesman in Dallas, Mark White,  has stated on the incidents that “Once these letters start showing up, they’ll keep showing up for days because some delivery of mail takes longer than others.”

    FBI spokesman Richard Kolko says, “Unfortunately this sort of hoax letter is phenomenally common.”  “In the last two years, we’ve had over 900 responses to white powder or WMD issues, and that doesn’t account for the countless numbers of incidents that don’t make it past the local police and fire departments.”

    We get them from a variety of people,” Kolko said.  “A lot of times we find they are people in jail sending them to judges and lawyers, disgruntled citizens and kids.  It runs the gamut.  The problem is that people out of ignorance think if they send sugar or flour, ‘What can they do to me?’  Well, it’s a federal crime.  A hoax is not a joke, and they will go to jail.”

    RANT ON

    Well, there’s not going to be a rant on this one however, this is one of those new things that I will follow pretty closely.  Profiling on anonymous letters to people you have never met is something that’s not well documented, but it seems to happen quite often.  The Why? + How? = Who  on this is not adding up to me.  How this person is doing it, well USPS from possibly TX, if they aren’t using a mail drop.  Why is the question?  What happened in this person’s life to “push” them to act?  And what did this person plan on getting out of sending anonymous letters?  Personal satisfaction?  Did the person end up in a bad financial situation, lose their home, become depressed, lost “touch” a bit, and now blames the government for this persons bad fortunes? 

    Yea, I like reading mysteries…..

    SOURCES:

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Obama Lectures Pesky Media For “Wasting Question” And My Personal Questions About Blago Comments On Obama.

12/17/2008 01:28:00 PM

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Gee, what a surprise.  Maybe Obama needs to learn, just like Rahm, that if you avoid the topic, you are going to just get questioned more.  Welcome to being a major part of government Obama.  And if you think that you can “pick and choose” which reporters to ask questions, that is true however, I’ve noticed that many MSM reporters, especially those in Chicago, are now asking questions in articles that we, the bloggers, have been asking for months.

Now Obama has been much more “transparent” and open to questions in comparison to previous Administrations however, taking questions and answering questions are two completely different matters.

The reporter in question, John McCormick of the Chicago Tribune, asked some very simple questions.  He wanted to know if there should be a special election to replace Illinois Governor Blagojevich, and about contacts with the Governor.  McCormick has a legitimate concern.  And McCormick is not new to asking questions on things people don’t like.

I think Obama could have answered at least the first question on the first time, and then simply stated that he couldn’t answer other questions because he had been asked/told by the US Attorney’s Office to not answer them as U.S. Attorney Patrick Fitzgerald had asked Obama to postpone releasing the investigation’s results until December 22nd with Fitzgerald’s office later issuing a one-sentence statement confirming the request, so that it canconduct certain interviews.”  It’s not that difficult to say “I can’t answer your questions because I have been asked by the U.S. Attorney’s Office to not answer them until next week.  I am sorry, but that is the way it has to be to ensure the validity of the investigation.”  Is that so difficult?

Instead Obama decided to be a jerk by lecturing and scolding the reporter and choosing to answer a third question by the reporter about his jump shot in what could be a Saturday Night Live skit.  The brush off’s and deflecting the press are now becoming more and more common with Obama and reporters.  And it is still yet to be seen exactly how much the Obama team knew about Blago, and if they knew he was selling the seat, then why didn’t they turn him in, especially since Obama is so hell bent on changing the corruption in government?  Is Obama’s own state exempt from being busted?  Especially since Michael Sneed, from the Chicago Sun-Times, even reports that Rahm is reportedly on 21 different taped conversations by the feds.  That’s a lot of conversations for just saying “Hello.  How ya doin’?” 

Additionally, it seems to now become a trend with Obama to avoid taking a position on virtually every new issue since his election, wanting to only talk about his team, or what he’s going to do to change our world in his press conferences. 

Mark Whitaker, NBC Washington bureau chief, said that reporters have not been aggressive enough during Obama’s post-election pressers.  “Our job is to hold him to account,” Whitaker said, adding that he thinks “we’re going to have to get tougher.”

Newsweek’s Jonathan Alter followed up:  “We need the Sam Donaldsons of the world.”

Today in another episode of the “Obama Show”, at a press conference just minutes ago, Obama was asked about how he squared his commitment to transparency in government with the tight-lipped response he and his advisers have had to questions about their dealings with the scandal-tarnished governor.  Obama said that it had been “frustrating” to maintain silence but that questions will be answered next week – which happens to be when he will be in Hawaii on break.

It’s a little bit frustrating.  There has been a little bit of speculation in the press that I would like to correct immediately.  We are abiding by the request of the U.S. Attorney’s office,” Obama said.  “But it’s not going to be that long.  By next week, you guys will have the answers to all of your questions.”

As Obama spoke, his political adviser David Axelrod and chief of staff designate Rahm watched.  Axelrod stood motionless, hands on hips, a frown partially hidden by his moustache, who was checking a message on his Blackberry when the question was asked, smiled in faint amusement, put the Blackberry away and watched the rest of Obama’s response with his legs crossed at his ankles, arms crossed and a single finger pressed across his lips.  He was still smiling.  Such a wonderful display of “superior mentality” in body language.

Axelrod had previously said that Obama had directly spoken to Gov. Blago about the Senate vacancy on November 23, 2008 on FOX News Chicago report.  “I know he’s talked to the governor and there are a whole range of names many of which have surface, and I think he has a fondness for a lot of them.”  On Tuesday of this week, Axelrod issued a statement retracting his previous statement.  “I was mistaken when I told an interviewer last month that the President-elect has spoken to Governor Blagojevich about the Senate vacancy.  They did not then or at any time discuss the subject",” said Axelrod.

THE PAST

Another example of Obama “scolding” the press was when he made his announcement about appointing Hillary Clinton to Secretary of State.  When asked about how his opinion had changed so much from the campaign time, Obama replied “this is fun for the press to try to stir up whatever quotes were generated during the course of the campaign” adding that many things said were because of the “heat of the campaign”, minimizing statements he had said against Hillary Clinton and her experience in foreign affairs choosing to attack the reporter instead.

Back on December 3rd,  Campbell Brown of CNN had a lecture for Obama about the press after Obama’s statements to the press about appointing Hillary Clinton:

“There we go again.  The pesky media – all we want to do is have a little fun, stir things up for our own amusement.  I mean, really, how silly of that reporter to dare ask you, Mr. President-Elect, how it is that you completely mocked Hillary Clinton’s foreign policy experience just a few months ago, and yet today, you think there is no one more qualified than she to lead your foreign policy team?  It’s a clever device, treating a question so dismissively in an attempt to delegitimize it, but it is a legitimate question.  As annoying how you may have found it, it is a fair question.  It was only in March of this year that Greg Craig, your new White House counsel, put out a memo over four pages long, outlining by point Hillary Clinton’s foreign policy claims, calling them all exaggerated, just words, not supported by her record.

Now, look, maybe you regret what you said about Hillary Clinton.  Maybe it was, as you suggested today, all just said in the heat of the campaign.  If that is the case, and you are both now rising above it, then you deserve to be commended for that.  And you could have been explicit in saying all of that today.  You could have explained the evolution of your thinking, instead of belittling a question you didn’t like.

Mr. President-Elect, reporters, we hope, are going to ask you a lot of annoying questions over the next four years.  Get used to it.  That is the job of the media, to hold you accountable.  But this isn’t just about the media.  It’s about the American people, many of whom voted for you because of what you said during the campaign, and they have a right to know which of those things you meant and which you didn’t.  Apparently, as you made clear today, you didn’t mean what you said about Hillary Clinton.  SO, what else didn’t you mean?  The media is going to be asking, and you were wrong today.  Annoying questions are about more than just the press having fun.  Annoying questions are about the press doing its job and the people’s right to know.

Many Obama supporters are pulling a phrase from the campaign, calling the questions about Obama and his team’s relationship with Blago a manufactured “smear campaign,” and harassment of Obama by reporters.   And in fact choosing different news outlets that focus only on the “good” of Obama, and not facts of everything.  I’m sorry, I didn’t know that asking simple questions about a major topic, that Obama has said only “We are not involved” or something to that effect isn’t good enough.  Please tell me when anyone has EVER taken any government officials word as the straight truth on a scandal?  Or are the Obama supporters simply ready to take Obama at every word he says without questioning?  Stupid is as stupid does, I suppose.

And one thing that no one but Chicago newspapers, seems to be picking up on is that Eric Holder, Obama’s pick for Attorney General, was Gov. Blago’s pick to sort out the mess involving Illinois’ long-dormant casino license.  Blago and Holder appeared together at a March 24, 2004, news conference to announce Holder’s role as “special investigator to the Illinois Gaming Board” – a post that was to pay Holder and his Washington D.C. law firm up to $300K.  Eventually however, Holder was not hired, and Blago said on May 18th, 2004, that he was scrapping Holder’s probe.  Holder, however, omitted that  from his 47-page response to a Senate Judiciary Committee questionnaire made public this week – signed by Holder this past Sunday – five days after Blago’s arrest. 

Obama’s team commented on the matter with Cutter, the Obama team spokeswoman saying “Holder and his firm receive no compensation from the state for this preparatory work.” She added that “The 2004 press conference was not memorable because Holder’s legal work for the State of Illinois never materialized.” Such a convenient slipping of Holder’s mind on the matter and such a lie.  If you are asked if you have had any relationship with a person, I think the above qualifies.  But according to the Obama camp, since Holden wasn’t paid, then there’s no reason to talk about it and disclose it.  Gee, I’m all “fuzzy” over how factual the report from the Obama camp on the internal investigation is going to be.

RANT ON AND QUESTIONS ABOUT INCRIMINATING BLAGO COMMENTS

My problem in all of this is with the media, is that many newspapers chose to not report important information during the campaign due to fear of repercussions of legal action and being “blackballed” out of interviews.  Why would the press actually start doing their job now?  And if Obama or any of his team members expect Fitzgerald and his prosecutors to be as accommodating as the press, they are in for a big surprise.  Just do a bit of research about Fitzgerald indicting and convicting former Cheney chief of staff Lewis Libby.

Now Obama has promised to release the full account of his team’s Blago ties next week, but not before December 22nd, just in time for Christmas, right?  First, let’s see if he makes good on that promise, especially considering he will conveniently be in Hawaii next week for the holiday, thus unavailable for comment and second, let’s see exactly what and how much he releases.  Time for the first real example of how transparent his Administration is going to be.  Of course, we all have to remember that the investigation was conducted by Obama’s lawyers, and not an outside independent agency.

Obama needs to realize that unless certain questions are answered in the upcoming release of the report, that this little press problem isn’t going to go away.  Notably, the question of which members of Obama’s team spoke with Blago’s staff about the Senate seat, the extent of the contact and whether anyone on the president-elect’s team knew of any illegal attempt by the governor to trade the vacated seat.  And how Obama plans to address the fact that Blago, according to the FBI tapes has been quoted to have said the following about Obama and the Senate seat:

he [Obama] has to give this motherf***er, his Senator.  F*** him.  For nothing?  F*** him!”  And even if the governor were to appoint a candidate favored by the Obama team, Blago said, “they’re not willing to give me anything except appreciation.”

If no one in Obama’s camp knew about Blago trying to sell the seat, Blago’s comments do not make any sense.  I am very curious as to how Obama is going to wiggle his way out of that one, claiming that no one on his team knew that Blago was trying to sell the seat yet Blago’s comment seem to suggest that Obama and/or his team refused to go along with the “pay to play” scheme.  The question remains of how Blago knew that Obama was not willing to give him anything in exchange for the Senate seat and with whom Blago was speaking with.  And the person that was speaking to Blago or anyone on his Administration report failed to report this to the authorities.

It has been stated by Fitzgerald that “there’s no reference in the complaint to any conversations involving the president-elect or indicating that the president-elect was aware of it, and that’s all I can say.”  His comment did not close the door on the possibility that Obama or someone on his staff may have known of some aspect of the governor’s demands.

What many people don’t seem to know is that Blago, according to the FBI, wanted an appointment to the Obama cabinet as Secretary of Health and Human services, a well-paying job, or huge campaign contributions as the price for naming Obama’s successor.  Blago was overheard by the FBI saying “I want to make money”, complaining he was “financially hurting.”

And as for Blago searching for a job for his wife, “Is there a pay here, with these guys, with her,” to work for  firm in Washington or New York, he is reported to have asked.  In the FBI affidavit, it is stated that Blago had been told by an adviser “the president-elect can get Rod Blagojevich’s wife on paid corporate boards in exchange for naming the president-elect’s pick to the senate.”  No, there is no discussion of money, but a barter for positions.  That is still illegal.  I am very curious as to how that one is going to be handled.

The bottom line is that if you have nothing to hide, then you shouldn’t get emotional over simple questions, even if you have to say, “I can’t comment now because I’ve been asked not to by the U.S. Attorneys Office.”  And if you have nothing to hide, then you don’t have a problem with an opinion on the entire matter.  And team members don’t conveniently “forget” about relationships with other people, recanting a few days later that “oh, I made a mistake.”

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Obama, Emanual and Blagojevich. Does Indirect Contact Count?

12/15/2008 06:47:00 PM

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obama blagojevich I’ve tried to stay away from this topic basically because there isn’t any evidence that Obama was directly involved with Blago’s money making scheme and the simple fact that Blago isn’t the governor of my state. 

But since this scandal hit the wires, in usual Obama style, he and his camp had no comment on the topic, declining to respond to even basic questions, until today.  And even then, its just a statement, and not a Q&A session on the topic. 

In a press released by Obama team spokesman Dan Pfeiffer, Obama’s lawyer stated that after the review “shows he had no direct contact with Illinois Gov. Rod Blagojevich about the appointment of a Senate replacement, and transition aides did nothing inappropriate.”  Pfeiffer said the review “affirmed the public statements of the president-elect that he had no contact with the governor or his staff, and that the president-elect’s staff was not involved in inappropriate discussions with the governor or his staff over the selection of his successor as U.S. Senator.”

Obama himself stated when he disclosed the results of an investigation he ordered,“As I said in a press conference last week, I had no contact with the governor’s office and I had no contact with anybody in the governor’s office.  What I indicated last week was there was nothing that my office did that was in any way inappropriate or related tot he charges that have been brought.”  Obama stated that the results of the investigation by his incoming White House counsel, Gregory Craig, would be released “in due course.”

And of course, Obama has called for Blago to resign.  Obama spokesman Robert Gibbs told the AP that Obama believes Blago should resign as “under the current circumstances it is difficult for the governor to effectively do his job and serve the people of Illinois.”

RANT ON

In due course?  Why in due course?  Why not today?  If the investigation is complete, then there would be no reason why not to release the information.  Unless, Obama is doing the CYA “thang”. Obama has no idea what the FBI has on Blago, and if Obama released the results of the investigation now, and later it is found that he or anyone on his incoming team have had “inappropriate contact” regarding filling the U.S. Senate seat, then that would make Obama look like a liar.  And that isn’t what our “new hope” wants, now is it?  He’s just covering his backside, just incase.

What is interesting to note about this two-part statement is that it is in typical attorney fashion. The statement says that Obama had no “direct contact” with Blago, however it does not say that Obama had indirect contact, meaning, through others.  It does not state that Obama had no contact with Blago on other matters, and it does not state that Obama had indirect contact over Blago appointing someone to fill Obama’s seat.

The second part of the statement, “and transition aides did nothing inappropriate”,  does not mean that the transition aides didn’t have contact with Blago on the appointment of the Senate replacement.

The person Obama’s attorney is talking about is probably Rahm Emanuel.  Emanuel has sidestepped the questions about his relationship with Blago.  One source confirmed that communications between Emanuel and the Blago Administration were captured on court-approved wiretaps.

According to the Chicago Tribune, another source said that contact between the Obama camp and the governor’s administration regarding the Senate seat began the Saturday before the Nov. 4th election, when Emanuel made a call to the cell phone of Harris.  The conversation took place around the same time press reports surfaced about Emanuel being approached about taking the position of Chief of Staff in Obama’s administration if Obama should win.

Emanuel delivered a list of candidates who would be “acceptable” to Obama, the source said.  On the list were Obama adviser Valerie Jarrett, Illinois Veterans Affairs director Tammy Duckworth, state Comptroller Dan Hynes and U.S. Rep. Jan Schakowsky of Chicago, the source said.

Sometime after the election, Emanuel called Harris back to add the name of Democratic Atty. Gen. Lisa Madigan to the approved list, the source said.

Blagojevich and Harris, who resigned his state post Friday, are charged with plotting to sell the selection of Obama’s replacement in exchange for lucrative jobs or campaign cash for the governor.

According to the AP who talked to two people briefed on the investigation, Emanuel is not the target of the probe.  One is a person “close” to Emanuel, who said he has been told by investigators that he’s not a subject of their probe.

But Emanuel has been rather elusive when questioned about his relationship with Blago.  A few days ago Emanuel was uncharacteristically absent from an Obama news conference.  He was spotted two hours later in the lobby of Chicago’s City Hall to listen to his two children performing in a concert with their school.

A Sun-Times reporter pressed Emanuel to comment about whether he was the emissary named in the criminal complaint:

You’re wasting your time,” Emanuel said.  “I’m not going to say a word to you.  I’m going to do this with my children.  Don’t do that.  I’m a father.  I have two kids.  I’m not going to do it.”

Asked, “Can’t you do both?” Emanuel replied, “I’m not as capable as you.  I’m going to be a father.  I’m allowed to be a father,” and he pushed the reporter’s digital recorder away.

Now a man has a right to his privacy, to a point when you are part of this country’s government.  But when you are a part of this country’s government, and refuse to answer questions and avoid reporters on the topic, you paint yourself as a target for reporters to hound you.  And you Emanuel is right, he can’t do both, but yet he hasn’t resigned his congressional seat in Illinois, yet he now works full-time on Obama’s transition team. 

But the “official Obama statement” on the matter leaves several issues uncovered, again in typical Obama style.  It did not say whether Emanuel was heard on wiretap providing the governor’s top aid with a list of names that the president-elect favored.  Nor did it say who, if anyone, on the Obama transition team had made contact with the governor or his aides concerning a replacement for Obama or whether Craig interviewed people under oath, or to whom he talked.

Do I think Obama knew that Blago was auctioning off the Senate seat?  Yep.  Do I think he made suggestions indirectly via his team to Blago of who to fill the seat with?  Yep.  Do I think Obama gave Blago money to “influence” his choice?  Nope.  Why?  Because the seat is still empty.  And based upon a taped conversation cited by prosecutors, suggested Obama wouldn’t be helpful to him and called him a “vulgar term.”  Told by two other advisers Blago has to “suck it up” for two years, the FBI says it heard Blago complain “he ahs to give this motherf***er, his Senator.  F*** him.  For nothing?  F*** him!”  And even if the governor were to appoint a candidate favored by the Obama team, Blago said, “they’re not willing to give me anything except appreciation.”

Obama is doing a serious CYA “thang”.  In November on FOX News Chicago, David Axelrod stated, “I know he’s talked to the governor and there are a whole range of names of which have surfaced, and I think he has a fondness for a lot of them.”  Then after the Blago scandal hit the news, Axelrod retracted his statement.  “I was mistaken when I told an interviewer last month that the President-elect has spoken directly to Governor Blagojevich about the Senate vacancy.  They did not then or at any time discuss the subject.”  Again, this statement says that Obama did not directly speak to Blago, it does not say that Obama didn’t have indirect contact via his team with Blago.  Careful wording is something that Obama and his team are becoming notorious for.

And one final thought.  It was an internal investigation.  It was done by Obama’s own attorney, not an outside attorney.  I would be very curious as to see what an outside attorney would find on the matter, especially considering that The New York Times is reporting today that “Emanuel Had Contact With Governor’s Office on Senate Seat”.  And The Wall Street Journal is reporting today that “Emanuel, Blagojevich Aides Discussed Senate Seat.”

But all in all, wiretaps and all, time will tell if and how Obama and/or his teams are connected in any way to the Blago scandal.

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You Can't Afford A Loan, But You Can Still Have It, And I Get A Bonus. [Class Action Lawsuit, Feds Investigate WaMu]

10/17/2008 05:18:00 AM

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2004351599 "We're going to have terrific days ahead of us.  I just want people to calm down, have a little faith."  - Washington Mutual Chief Executive Kerry Killinger's statement to shareholders in April, 2008.

"None of this would have occurred if Wall Street hadn't found a way to take bad loans and make them look good, and sell them to people who didn't know any better,"  Lee Lannoye, retired [1998] chief credit officer and executive vice president at WaMu.

Federal investigators are looking into the decline and fall of Washington Mutual Bank, and it seems they won't have to go far for a wealth of allegations as to the causes, or source material on those accusations.

Three class-action lawsuits, consolidated into one, are pending against WaMu, and former employees are speaking out about how they were told to "lay off" about warnings of the risks of ARMs, including being terminated because of just doing their job.  And in April, 2008, stockholders were demanding that the high level executives step down from their positions.

CLASS ACTION LAWSUITS

Three class-action lawsuits -- each a consolidation of similar lawsuits filed against the company, directors, executives (and in some cases accountants and securities underwriters) -- now pending in federal court detail the sorts of conduct that a task force may be looking into as part of its investigations.

One of those suits in particular filed August 05, 2008 (PDF) -- a securities class-action suit 470 pages long representing investors who bought WaMu stock between Oct. 19, 2005 and July 23, 2008 -- uses interviews with former employees (many identified as "confidential witnesses" followed by a number) to describe what actually was going on inside the Seattle-based consumer bank and mortgage company.  The lawsuit alleges that "WaMu's concerted efforts to transform itself from a sleepy savings and loan into a high-margin bank began to include highly questionable and unlawful practices"  taking into consideration that for the years 2006 and 2007, just under 70% of WaMu's net interest income was generated by residential real estate loans and related products and over 60% of WaMu's overall average assets were generated by residential real estate loans and related products.

One of those questionable practices, the suit says, was the heavy use of option ARM's, a type of adjustable-rate mortgage on which the borrower sets the monthly payment, even if the result is that the balance owed actually increases.  WaMu's stock fell from $37.90 a share to $4.65 in that period.

"WaMu loan production personnel were compensated based on loan volume without any regard to loan quality, and were paid even more for originating riskier loans, including option ARM loans," the suit alleges.  "WaMu's employees, accordingly, targeted more and more borrowers who were less able to afford the loan payments they would have to make, and many of whom had no realistic ability to meet the obligations incident tot he loans they were sold."

Former employees, according to the suit, said that they emphasis was "always quantity rather than quality," and that borrowers weren't informed as to the structure of the loans, in which a low teaser rate would jump to a much higher rate in the loan, or that low payments would cause the balance to increase.

Some of the bank's lenders and underwriters, who sold mortgages directly to home owners, said they felt pressure to sell as many loans as possible and push risky, but lucrative, loans onto all borrowers, according to an ABC News article.

The suit adds that WaMu deliberately weakened underwriting standards on both subprime and prime mortgages to generate volume.  Loans were labeled fully documented even when they had little or no documentation of income of assets of the borrower.  Appraisers were pressured to deliver home values that would justify making loans, and warnings from risk-assessment executives, the "gatekeepers" who were suppose to protect the bank from taking undue risks, were ignored, marginalized and, in some cases, fired.

DALE GEORGE

Dale George, a former senior risk manager at WaMu, who spoke to ABC News, likened his job to the brakes on a car.  But George claims WaMu executives "took the brakes off and drove over a cliff."  As the housing bubble swelled and high-risk mortgage lending became more lucrative, the bank changed, according to George.  WaMu began approving as many loans as it could.  "Everything we refocused on loan volume, loan volume, loan volume," he told ABC News.  George said risk managers were told to "lay off" about warnings of the risks involved in mortgage loans.

And according to ABC News, they obtained an email where one WaMu executive told risk managers about a "cultural change" at the bank, and urged them to "lead the charge in modifying the perception of compliance and risk oversight from a regulatory burden to a competitive advantage."  George said this had a chilling effect:  It told risk managers that they "could not raise meaningful issues" and "really had to sweep negative findings under the carpet."  George continued with that he refused to sweep away his findings, claiming "there was a number of instances where I was pressured to fix a certain rating or upgrade the rating."

In one case, he said he refused to improve the risk rating on a $50 million commercial loan, an improvement that would have allowed the bank to significantly increase that loan.  For that, he said he was taken off the project, reprimanded by senior management, and eventually fired when he raised his concerns to top executives.  WaMu denied any wrongdoing and said the firing wasn't retaliatory.

DOROTHEA LARKIN

Another WaMu employee, former senior underwriter Dorothea Larkin, said she, too, was uncomfortable with the sift in lending standards. "It was all about making the numbers, closing all the loans that came through the door," loans like higher risk option ARMs and subprime loans, she said.

According to the ABC News report, WaMu's underwriters were told not to question whether or not a home loan should have been approved, but just to ensure certain lending procedures were followed, according to Larkin.  She called this hands-off underwriting approach "unusual."

Larkin described a bank eager to loan money at any long-term cost.  For example, she said WaMu lent millions to a borrower even after he defaulted on a multimillion dollar home construction project.  "We just kept giving him money," she said, "and I'm sure that's one of the foreclosures WaMu is still sitting on."

"The executives are the ones who made the decision to take WaMu in this direction," she said.  "Too many of the middle folks like myself said this is wrong, we're making loans we shouldn't be making, we're qualifying borrowers who we know are going to struggle to pay the loan back."

UNKNOWN WAMU EMPLOYEE

At a stockholders meeting in April, 2008, a man who identified himself as a WaMu employee and shareholder laid the blame for the company's troubles squarely on Stephen Rotella, president and chief operating officer since 2005.

The man, whose name could not be made out clearly, said that under Rotella's leadership, WaMu loan consultants were paid more for writing subprime mortgages and so-called "option ARMs" with ultra-low teaser rates than for writing safer, fixed-rate loans.

"This man [Rotella] has driven the company to the edge of bankruptcy and he should be fired, and his bonuses should be taken back from him," the man said.

LEE LANNOYE

Lannoye, 70, retired at the end of 1998 after a decade as chief credit officer and executive vice president at WaMu.    In April, 2008 he wanted WaMu's current execs to take responsibility for leading the bank down the path to losses.  "It obviously has not been very well managed the last four or five years," he said.  "They made some pretty stupid decisions." 

"...they are losing $8 billion, $12 billion [in total projected credit losses].  An not one person has been let go," he said.  "They closed down construction lending, the closed home-loan centers, but non of the people who made the strategic decisions to lower the credit standard ... they're all still there, including the board."

"None of this would have occurred if Wall Street hadn't found a way to take bad loans and make them look good, and sell them to people who didn't know any better,"  Lannoye stated.  "That doesn't excuse WaMu management for changing their risk profile and making loans to people who didn't qualify."

RIGGINING THE NUMBERS

According to the lawsuit:  "Defendants' efforts to rig the real property appraisal process relating to WaMu's loans were designed to artificially increase loan origination volume and therefore increase growth and revenue related to WaMu's core business -- residential lending -- and thereby make WaMu's financial condition appear healthier than it actually was," the suit says.

The net effect, it adds, was that "management at the highest levels (was able) to increase the level of risk assumed by the company without informing investors of this critical fact."  The amount of money that the company should have been setting aside in reserves to cover possible loan losses was inadequate, it adds, often by hundreds of millions of dollars, which further inflated earnings.   All the while, in press releases, presentations to investors and SEC filings, the company was assuring the public that it was in good shape and managing risk.

"WaMu was saying, consistently, up to the end, that they were conservative, prudent, rigorous," but in reality, "it was run in a way that was irresponsible, reckless, dangerous," contends Chad Johnson of Bernstein Litowitz Berger & Grossmann LLP, one of the attorneys representing the shareholders who filed the lawsuit.

KERRY KILLINGER

The suit also questions sale of stock by Chief Executive Kerry Killinger even as the bank's financial condition was deteriorating, especially pertaining to insider stock sales by Killinger during the time stating they were "highly unusual and suspicious."  That Killinger's stock sales increased during the time in question, and there was an increase in stock sales at the same time as WaMu initiated major stock buybacks.

APRIL, 2008 STOCKHOLDERS MEETING

In April, 2008 investors were angry with Killinger, and he pleaded with the shareholders at a meeting.  "I know it's tough," Killinger said at the meeting.  "Nobody likes a penny dividend.  Nobody likes the stock price where it is.  Nobody likes to raise capital now.  I'd never do any of that, except we have to."  Killinger continued with "[WaMu] has the capital, the passion, the commitment to ... get through this.  We're going to have terrific days ahead of us.  I just want people to calm down, have a little faith."

At that same meeting, shareholders demanded that he, other executives and directors quit to take responsibility for WaMu's troubles. 

Additionally, WaMu's 2008 executive bonus plan was roundly denounced for minimizing the impact of sound real-estate loans and foreclosure expenses.  Many observers saw that as an attempt to shield executive bonuses from the impact of the mortgage meltdown.

Alan Henry, a stockholder, accused Killinger of opting for the investment led by TPG, rather than a reported buyout offer from J.P. Morgan Chase, simply to preserve his job.  "What you've got to do is what some real men do - real men.  When you face a situation like this, you stand down.  I ask you, out of good judgement, to stand down" Henry said to Killinger.

DEFENDANTS

The following defendants in the lawsuit;  Kerry K Killinger, Thomas W. Casey, Stephen J. Rotella, Ronald J. Catheart, David C Schneider,  John F. Woods, Melissa J. Ballenger, Anne V. Farrell, Stephen E. Frank, Thomas C. Leppert, Charles M. Lillis, Phillip D. Matthews, Regina Montoya, Michael K. Murphy, Margaret Osmer-McQuade, Mary E. Pugh, William G. Reed Jr., and Orin C. Smith.  The defendants in the case haven't filed responses to the suits, other than motions to dismiss a derivative lawsuit (in which an investor sues defendants on behalf of the company) and a second class-action lawsuit representing employees who had participated in a company saving plan that bought WaMu stock.

A motion to dismiss the securities lawsuit was due earlier this month.  But the proceedings in all three suits have been complicated and delayed by the Sept. 25 action of federal regulators to seize Washington Mutual Inc.'s banking operations, subsequently sold to J. P. Morgan Chase.

Directors and former executives haven't commented publicly about what happened at WaMu.

FEDS INVESTIGATION

US authorities have opened a wide-ranging probe into the collapse of WaMu.  A statement issued Wednesday by US Attorney Jeffrey Sullivan in Seattle, Washington said investigators were looking for information on potentially illegal activity related to the thrift's failure. 

Due to the intense public interest in the failure of Washington Mutual, I want to assure our community that federal law enforcement is examining activities at the bank to determine if any federal laws were violated.  The FBI, Federal Deposit Insurance Corporation Office of Inspector General (FDIC-OIG), Securities and Exchange Commission (SEC) and the Internal Revenue Service Criminal Investigations (IRS-CI) have all provided investigators to our task force.  We are asking that anyone with information for the task force contact this number:  1-866-915-8299; or this email address:  fbise@leo.gov.

For more than 100 years Washington Mutual was a highly regarded financial institution headquartered in Seattle.  Given the significant losses to investors, employees, and our community, it is fully appropriate that we scrutinize the activities of the bank, it's leaders, and others to determine if any federal laws were violated.

Press contact:  Emily Langlie, Public Affairs Officer, U.S. Attorney's Office, at (205) 553-4110.

U.S. Attorney's Office, Press Release

Neither the statement nor a spokeswoman for the U.S. Attorney's Office elaborated on what areas the task force might be looking at. 

J.P. MORGAN CHASE & WASHINGTON MUTUAL

In a bankruptcy court filing Tuesday, Washington Mutual said it had reached agreement with J. P. Morgan Chase granting it access to $4.4 billion it had on deposit at its subsidiary bank before the seizure and sale.  Washington Mutual said the settlement will help "maximize recovery for the debtor's creditors," calling the deposits "the largest asset of the estate available for distribution" to those creditors.

On Wednesday of this week, J.P. Morgan Chase reported it took a $640 million after-tax loss in the third quarter as a result of its purchase of WaMu, which it owned for only three business day before the end of the reporting period on Sept. 30.  Because J.P. Morgan only purchased WaMu's banking assets, it is not required to report the bank's third-quarter earnings.

J.P. Morgan Chase stock dropped $2.22 a share in trading on Wednesday to $38.49; a year ago it closed at $46.27.

WaMu stock has been delisted and now trades in the pink sheets, at about 10 cents a share.  A year ago it closed at $34.27.

A spokesman for J.P. Morgan Chase, Tom Kelly, declined to comment on the Feds investigation.

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