[Quote:]

The Army official who managed the Pentagon’s largest contract in Iraq says he was ousted from his job when he refused to approve paying more than $1 billion in questionable charges to KBR, the Houston-based company that has provided food, housing and other services to American troops.

The official, Charles M. Smith, was the senior civilian overseeing the multibillion-dollar contract with KBR during the first two years of the war. Speaking out for the first time, Mr. Smith said that he was forced from his job in 2004 after informing KBR officials that the Army would impose escalating financial penalties if they failed to improve their chaotic Iraqi operations.

Army auditors had determined that KBR lacked credible data or records for more than $1 billion in spending, so Mr. Smith refused to sign off on the payments to the company. “They had a gigantic amount of costs they couldn’t justify,” he said in an interview. “Ultimately, the money that was going to KBR was money being taken away from the troops, and I wasn’t going to do that.”

But he was suddenly replaced, he said, and his successors — after taking the unusual step of hiring an outside contractor to consider KBR’s claims — approved most of the payments he had tried to block.

[Quote:]

An organization that promotes sexual abstinence for teens received a federal grant of over a million dollars, twice what it had requested, despite the skepticism Department of Justice staffers had about the group and the fact that it refused to participate in a congressionally mandated study.

So why did the Best Friends Foundation receive the grant from the Justice Department’s juvenile justice office even though dozens of competing organizations were rated higher by the office’s own reviewers? Current and former staffers say it was because of Best Friends’ powerful president and founder, Elayne Bennett.

Not only is Bennett the wife of Bill Bennett, a former Reagan and Bush administration official and conservative political commentator, but she is also personally close to the chief administrator of the Office of Juvenile Justice and Delinquency Prevention (OJJDP), J. Robert Flores.

DOJ staffers were deeply skeptical when Best Friends applied for a grant of around a half-million dollars last summer. For one thing, the organization had backed out of a congressionally mandated study to examine whether or not abstinence programs are effective.

[Quote:]

Corporate death benefits are under scrutiny with the Wall Street Journal reporting on Tuesday that heirs of some company chiefs are set to get hundreds of millions of dollars in so-called golden coffin benefits.

For instance, Nabors Industries would owe the estate of CEO Eugene Isenberg a “severance” payment of at least $263.6 million, which is more than the first-quarter earnings at the Houston oil-service company, the Journal said.

[..]

Compensation critics call the practice the ultimate in pay that is not based on performance.

[..]

It said the CEO of Shaw Group Inc is in line to be paid $17 million for not competing with the engineering and construction company after he dies.

For not competing after he dies? Either Shaw Group is insane, or they believe in zombies…

[Quote:]

The US military has awarded an $80 million contract to a prominent Saudi financier who has been indicted by the US Justice Department. The contract to supply jet fuel to American bases in Afghanistan was awarded to the Attock Refinery Ltd, a Pakistani-based refinery owned by Gaith Pharaon. Pharaon is wanted in connection with his alleged role at the failed Bank of Credit and Commerce International (BCCI), and the CenTrust savings and loan scandal, which cost US tax payers $1.7 billion.

The Saudi businessman was also named in a 2002 French parliamentary report as having links to informal money transfer networks called hawala, known to be used by traders and terrorists, including Al Qaeda.

Interestingly, Pharaon was also an investor in President George W. Bush’s first business venture, Arbusto Energy.

[Quote:]

Republican presidential candidate Sen. John McCain’s national campaign general co-chair was being paid by a Swiss bank to lobby Congress about the U.S. mortgage crisis at the same time he was advising McCain about his economic policy, federal records show. [See sidebar.]

“Countdown with Keith Olbermann” reported Tuesday night that lobbying disclosure forms, filed by the giant Swiss bank UBS, list McCain’s campaign co-chair, former Texas Sen. Phil Gramm, as a lobbyist dealing specifically with legislation regarding the mortgage crisis as recently as Dec. 31, 2007.

Gramm joined the bank in 2002 and had registered as a lobbyist by 2004. UBS filed paperwork deregistering Gramm on April 18 of this year. Gramm continues to serve as a UBS vice chairman.

So while Gramm was advising McCain to let people lose their homes rather than get more favorable terms on their loans, he was active as a lobbyist for UBS. Sounds bad, right? Well, UBS was actively breaking the law at the same time:

[Quote:]

UBS has told members of its former private banking team responsible for rich US clients not to travel to America, the Financial Times reported.

The Swiss bank has also made lawyers available to the more than 50 bankers involved, many of whom have left UBS since it decided last November to wind down its cross-border private banking business for US customers.

The move follows the recent indictment of one of the unit’s former senior executives, Bradley Birkenfeld, who US authorities have accused of helping a billionaire client evade taxes. Birkenfeld has pleaded not guilty.

[Quote:]

According to an audit released today by the DoD’s IG, there has been virtually no oversight of over $8 billion paid by the Defense Department to contractors in Iraq. The report confirms a similar finding back in 2005 that over $9 billion in Iraq war funds were unaccounted for. As a factual and non-polemical matter, this spectacular waste of taxpayer money has undoubtedly lined the pockets of more than a few war profiteers. To say the Iraq war has been plagued with rampant corruption, fraud and fiscal mismanagement is not an editorial position or overstatement: even lawmakers have begun to acknowledge this.

[Quote:]

De vijf grootverdieners van het Nederlandse bedrijfsleven hebben vorig jaar voor 131,8 miljoen euro aan bonussen ontvangen.

Dat is evenveel als 4000 Nederlanders bruto in een jaar verdienen, uitgaande van een modaal salaris.

[..]

De oud-topmannen Jan Bennink van Numico en Rijkman Groenink van ABN Amro ontvingen vorig jaar samen ruim 100 miljoen euro.

De overige drie van de top vijf zijn Jeroen van de Veer (Shell), Gary Pruitt (chemisch distributeur Univar) en Zach Miles (uitzender Vedior).

[Quote:]

A few years back I put it this way: “A cursory examination of American business suggests that its major product is wasted energy. Compute all the energy loss created by corporate lawyers, Washington lobbyists, marketing consultants, CEO benefits, advertising agencies, leadership seminars, human resource supervisors, strategic planners and industry conventions and it is amazing that this country has any manufacturing base at all. We have created an economy based not on actually doing anything, but on facilitating, supervising, planning, managing, analyzing, tax advising, marketing, consulting or defending in court what might be done if we had time to do it. The few remaining truly productive companies become immediate targets for another entropic activity, the leveraged buyout.” And this was all before the rise of the killer hedge fund.

[..]

At the time of the Enron collapse, I noted, “The last two administrations have been characterized by the invasive influence of an arrogant, autistic, and amoral class of late 20th century MBAs and similar members of the technocratic elite. This class has junked sixty years of social democracy, helped wreck the Russian economy, made every American worker a temp-in-waiting, carpet bombed the English language, trashed every moral concept in their way, and twisted reality so effectively they even convinced many that they were sex objects.

“And they are everywhere. You will find them running schools and universities and managing once great museums. They talk mush, think mush, market mush, report mush, and defend mush. They attempt to make up in certitude what they lack in wisdom; they can’t tell the difference between a phrase and a product; and they create infantile and self-serving distortions of economic principles that they declare to be the only principles in life worth observing. They are, in the end, just so many more televangelists, but with themselves as God. Perhaps worst of all, they are without the capacity for shame. Like other sociopaths, they are remorseless.”

Since then, it’s only gotten worse.

[Quote:]

Countrywide Financial Corp. said Tuesday it lost $893 million in the first quarter, as rising loan defaults amid a deepening housing downturn forced the nation’s largest mortgage lender and servicer to sharply increase its provision for loan losses and book other credit-related charges.

The latest results marked the third consecutive quarterly loss for Countrywide, which reaped a windfall during the housing boom but has been struggling since last summer, despite predictions last fall by CEO Angelo Mozilo that his company would turn a profit in 2008.

[..]

Meanwhile, Mozilo, who co-founded Countrywide in 1969, was paid more than $22.1 million and cashed out $121.5 million in stock options last year.

[Quote:]

Have public company Boards learned any lesson from Enron? A March 31, 2008 article [sadly not online] about Stan O’Neal, the former CEO of Merrill Lynch, suggests not.

The Board at Merrill Lynch Enronized their company by promising to pay Stan O’Neal roughly $50 million per year if he made some numbers look good. One of the numbers that they wanted to see improved was Return on Equity. O’Neal managed to improve it by using the company’s cash to buy back stock. By reducing the amount of equity in the firm, whatever profit they managed to earn in a given year would be a larger percentage of the remaining equity. Unfortunately, for a company that faces risk, reducing the cash supply inevitably means courting disaster.

The Board also decided to give bonuses to executives based on where Merrill ranked in the business of creating mortgage-backed securities. O’Neal and colleagues managed to grab the number-one spot by 2005, near the tail-end of the real estate bubble. Merrill would buy up garbage mortgages from retail banks, mortgages that by 2005 hardly anyone else wanted. These were loans on houses that had never been independently appraised to homeowners who had never proved that they had any source of income. Merrill’s goal was to package up this junk and sell it to fools in the institutional investment community. This worked great for a while and Merrill pocketed a lot of fees. By 2006, however, the supply of fools to buy up baskets of junk mortgages was dwindling. Merrill could have simply stopped buying the mortgages, but that would have resulted in a loss of fees and a reduction in executive salaries. O’Neal, who had been the Chief Financial Officer of Merrill, and his subordinates decided to continue buying the junk mortgages and wrapping them up into CDOs but, because nobody out there was dumb enough to buy the CDOs, keep the CDOs for themselves and account for them at the value that they wished they could have sold them for. Merrill ended up with $32 billion in nearly worthless debt. O’Neal retired with the savings from his $50 million per year salary plus a lot of bonuses and retirement extras.

[..]

So… if you’re on a Board and you decide to compensate a manager with anything other than cash or a long-term stock option, make sure that you’re not granting compensation based on a number that the manager can easily manipulate. Keep in mind that managers are often a lot more clever in doing things that will benefit themselves than things that will benefit the company.

[Quote:]

One by one, top executives of American oil companies met privately over the last year with Libya’s leader, Col. Muammar el-Qaddafi, often in his signature Bedouin tent, as they lined up contracts allowing them to tap into the country’s oil reserves.

But now, the new allies are working Capitol Hill, trying to weaken a law that threatens those deals. The Libyan government, once a pariah, and the American oil industry have hired high-profile lobbyists, buttonholed lawmakers and enlisted help from the Bush administration, all in an effort to win an exemption from a law that Congress passed in January that is intended to ensure that victims of terrorist attacks are compensated.

[Quote:]

What do Cliff Stearns, John Shimkus and Fred Upton have in common?

They’re all members of the House telecommunications subcommittee, and they’ve each publicly accused Google of having “duped” the Federal Communications Commission by “gaming” a recent multibillion-dollar auction of wireless frequencies, shortchanging federal coffers.

They also have this in common: Each has received more than $100,000 in campaign contributions over their careers from telephone and cable interests locked in a battle with Google over the use of those frequencies.

[Quote:]

Hedge fund managers, those masters of a secretive, sometimes volatile financial universe, are making money on a scale that once seemed unimaginable, even in Wall Street’s rarefied realms.

One manager, John Paulson, made $3.7 billion last year. He reaped that bounty, probably the richest in Wall Street history, by betting against certain mortgages and complex financial products that held them.

Paulson, the founder of Paulson & Company, was not the only big winner. The hedge fund managers James Simons and George Soros each earned almost $3 billion last year, according to an annual ranking of top hedge fund earners by Institutional Investor’s Alpha magazine, which comes out Wednesday.

Meanwhile, here’s what these robber barons have done last year:

[Quote:]

Merrill Lynch & Co. posted its third-straight quarterly loss Thursday and said it would cut another 4,000 jobs, as damage from a poorly managed plunge into risky credit-market activities under its previous chief executive continued to hurt the U.S. broker.

The loss of $1.96 billion, or $2.19 a share, was driven by $6.6 billion in write-downs related to mortgages, complex securities called collateralized debt obligations, and loans made to junk-rated companies. Merrill wrote down another $3.1 billion in mortgage-related securities held at its U.S. banks, though that hit for accounting reasons only showed up on the broker’s balance sheet.

[..]

Merrill’s loss would have been a lot deeper had it not been for a $2.1 billion gain booked on the declining value of the bank’s own debt. The move, while counterintuitive, is a legitimate quirk of mark to market accounting. Merrill’s Wall Street peers also book such benefits, though Merrill’s was unusually large.

[Quote:]

For the first three quarters of 2007, $1.1 trillion in Army accounting entries hadn’t been properly reviewed and substantiated, according to the Department of Defense’s inspector general. In 2006, $258.2 billion of recorded withdrawals and payments from the Army’s main account were unsupported. It’s as if the Army had submitted multibillion-dollar expense reports without any receipts.

I would suggest looking into the books of Halliburton, Blackwater, the defense companies, and Dick Cheney’s offshore bank accounts for the money.

[Quote:]

Yes. Of course. “Drafting errors” that benefit Blackwater and Halliburton subsidiaries work their way into policy regulations all the time. How embarrassing.

[Quote:]

BT’s covert trial of Phorm’s ISP adware technology in summer 2007 involved tracking many thousands more customers without their knowledge than previously reported, it’s emerged.

Erroneous reports earlier this month suggested that a total of 36,000 broadband lines had been eavesdropped upon during the two trials. The Register had revealed that 18,000 customers were profiled in 2006, but no figure was released for the second experiment.

Today Phorm said the 2007 trial was actually performed on “tens of thousands” of lines. It refused to provide a specific figure, but at the absolute least there are 38,000 BT Retail customers unaware their communications have been allegedly criminally intercepted in the last two years. The number could be as high as 108,000.

108,000 criminal violations, and nobody arrested yet. It’s nice to be a big corporation these days.

Oh, and if you’re a BT customer, and they complain about your bandwidth usage, just claim it is really “very small”.

Using their definition of “small”, of course.

[Quote:]

CBS Corp. Chief Executive Leslie Moonves got a 29% bump in his compensation in 2007, reaping a package valued at $36.8 million, according to a proxy filed with the Securities and Exchange Commission.

The compensation package, ranking among the biggest in the media industry, was awarded in a year in which CBS’s stock fell about 13% and its net income tumbled 25%.

[Quote:]

CEOs are just like the rest of us: They hate paying for things out of pocket if they can find someone else to foot the bill.

Fortunately for them, in many cases there is someone willing to pick up the bill for selected personal expenses: the shareholders.

A new study from The Corporate Library finds that the most common form of perk being granted to CEOs these days is something called a tax “gross-up.” In plain English, it means that a company pays the taxes owed by the CEO on benefits granted by the company.

The Corporate Library, a shareholder watchdog group, found that 20% of major American companies, or 657 of nearly 3,300 examined, picked up the tab on at least one tax owed by the CEO.

“We are sure that many U.S. workers would be grateful if their employers also paid their income tax obligations,” writes Paul Hodgson of The Corporate Library in the report.

[Quote:]

Bestuursvoorzitter Jean-Paul Votron van de Belgisch-Nederlandse bankverzekeraar Fortis heeft een bonus van 2,5 miljoen euro gekregen voor de overname van ABN Amro. Dat blijkt uit het maandag gepubliceerde jaarverslag van Fortis.

[..]

Uit het jaarverslag is verder af te leiden dat het basissalaris van Votron flink omhoog gaat van 750.000 euro vorig jaar naar 1,3 miljoen euro dit jaar.

Je gaat je afvragen of het belang daat Voltron had bij een overname wel in lijn lag met het belang van het gefuseerde bedrijf…

[Quote:]

Het aantal bonnen voor snelheidsovertredingen is in 2007 met 10 procent gestegen naar ruim 9,7 miljoen. Met een totaal aantal van 12.640.881 boetes, goed voor 550 miljoen euro, werd een record gevestigd.

[..]

Vanaf morgen worden boetes 20 procent hoger.