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Shaw Capital Management News: Public Health Financing Abysmally Low, says CMD
By Wale Adepoju
• ‘Govt spends N4,500 per patient yearly’
The Federal Government spends N4,500 on a patient yearly, a medical practitioner has said.
The Chief Medical Director (CMD), Lagos University Teaching Hospital (LUTH), Idia Araba, Prof Akin Osibogun, made this known at a workshop by the hospital for health reporters in Lagos.
Comparing health financing in the United States to Nigeria’s, he said public expenditure per head on health care in the US is $7,681 while that of Nigeria is below $30. “Nigeria’s Gross Domestic Product (GDP) per head is $1,000 while in the US it is $22,000.”
He said the yardsticks for measuring health care are indices of health outcome such as infant rates, death of under-five and maternal deaths.
He said patients should pay for treatment, because health care is expensive, and the government cannot do it alone.
On the saying that prevention is better than cure, he argued: “Preventive medicine should be embraced as curative medicine is expensive and unattainable by the poor especially.”
According to him, the quality of health care that people want is capital intensive and the government cannot do it alone. “Whenever you match quality against equity, quality must suffer.”
To achieve the best practices, he noted that technology is needed in health care, but “it is quite expensive, as it has to be managed and in some cases replaced.”
Osibogun said: “Health is not merely the absence of diseases, but a complete state of physical and mental well-being. This requires a lot of things.”
He said whereas private hospitals can charge a fee of N1million to enable to replace the equipment they use, adding that government hospitals can’t charge that high amount and may not be able to replace the items used.
He said technology advances the ability of experts to conduct diagnosis and detect diseases. This, he said, brings to the fore some of the challenges in defining health.
He said health is viewed from five Ds – death, diseases, disability, discomfort and dissatisfaction.
Osibogun said technology must be funded as it had economic implication to it. “An x-ray can perform limited functions, but a CT scan can do more while a Magnetic Resonance Imaging (MRI) can pick more information than the CT scan,” he added.
He said further that defining disease is not also easy as economy and technology deployed have roles to play. “For example, on breast cancer some of the lumps can be benign, others may be malignant. You can diagnose with immunograph or biopsy. Technology can help make better diagnosis but it is expensive,” he said.
Shaw Capital Management Factoring: North Aurora resident says charges of hedge fund scam ‘absolutely false’
http://beaconnews.suntimes.com/7402737-417/north-aurora-resident-says-charges-of-hedge-fund-scam-absolutely-false.html
One day after the Securities Exchange Commission announced it was freezing his company’s operations, a North Aurora businessman denied that he has ever swindled anyone.
Belal Faruki said a report released Wednesday by the SEC is based on the complaint of one his partners who was upset that the private investment firm lost money. This partner “cried wolf” to the SEC, Faruki said.
“It’s false,” he said. “It’s absolutely false.”
The SEC complaint alleges that Neural Markets ran an elaborate scheme that defrauded at least one investor of $1 million. The complaint also alleges that Neural Markets lied by portraying itself as a hedge fund that had a positive investment performance since 2009 and that other wealthy investors had put $5 million into the business. According to the complaint, Faruki misled the investor about the time period and amount of losses.
On Thursday, Faruki said the entire complaint is a smear campaign by one former partner.
“It’s working. He definitely ruined our lives,” he said. “And the government is his free lawyer right now.”
Faruki said he is a mathematician who designed software that could provide good investment strategies. As principal owner of Neural Markets, he and five friends decided to use the software to invest in the market. It was a private company that did not want outside investors, Faruki said.
“We don’t take public money. We don’t advertise ourselves to the public. We’re not interested in that,” he said. “We don’t want to be a hedge fund.”
The fund did lose money in October and November of 2010, Faruki said. Faruki said the investor who filed the complaint lost about $220,000, and demanded the others cover his losses — a request the other balked at.
“That’s not how this works,” he said. “The agreement he signed is that we’re partners and we all share equally in the gains and losses.”
Faruki said the reason no other victims are mentioned in the SEC complaint is that there aren’t any. According to Faruki, it is simply one disgruntled partner who could not get a criminal complaint filed so he turned to the SEC.
“The SEC is allowing taxpayers’ dollars to be blown on a frivolous lawsuit,” Faruki said.
Faruki identified the partner complainant, but The Beacon-News is not printing his name because he could not be reached for comment and is a potential victim. Faruki said he plans fight the civil complaint and the company is planning to sue the investor.
Shaw Capital Management Factoring: Samsung had warning Apple was trying to ban Galaxy Tab 10.1 in EU
http://venturebeat.com/2011/08/12/samsung-had-warning-that-apple-was-trying-to-ban-galaxy-tab-10-1-in-eu/
Though Samsung told VentureBeat on Tuesday the company had “no notice” Apple was requesting an injunction to ban the Galaxy Tab 10.1 tablet in Europe, a report today says Samsung knew what Apple was up to.
FOSS Patents‘ Florian Mueller has obtained a revealing press release from the Düsseldorf district court, which blocked the Galaxy Tab 10.1 from sale in the EU. The release shows that about a week before Apple filed its injunction, Samsung filed a “Schutzschrift,” a protective pleading that companies normally file when anticipating a preliminary injunction.
“While it’s true that they weren’t put on notice and that there wasn’t any hearing, Samsung wasn’t forthright enough to admit that it had filed a protective pleading,” Mueller wrote. “Samsung wasn’t blindsided — Samsung knew it had this coming, and the court’s decision was based on both Apple’s motion and Samsung’s preemptive opposition pleading.”
The news comes the same day a date has been set for Samsung to appeal the German court’s decision. Samsung will go to court on Aug. 25 to try to convince it to unblock the sale of the Galaxy Tab 10.1 throughout Europe (excluding the Netherlands). As of now, Samsung can face fines up to $350,000 per unit if it continues to sell the device in the EU.
FOSS’ Mueller thinks Samsung has done itself a considerable disservice by misleading the press on this closely watched story.
“This kind of communication strategy on Samsung’s part is old-school spin doctoring and only serves to strengthen my impression that Samsung is in a legally weak position against Apple,” Mueller wrote. “If Samsung wants to inspire confidence, it has to understand that half the truth is sometimes tantamount to a whole lie.”
Samsung certainly doesn’t look good in this position, but we will see what happens Aug. 25. Samsung did not respond immediately to VentureBeat’s request for an official comment.
Apple and Samsung have been legally sparring since April, when Apple filed a lawsuit in the U.S. concerning the company’s Galaxy Android smartphones and Galaxy Tab. Apple argued Samsung’s devices heavily imitated the iPhone and iPad. Samsung filed a counter-suit against Apple, but the battle also extended to the U.S. International Trade Commission, which can block the importation of devices into the U.S.
Shaw Capital Management Factoring: IMF hack a warning for others to invest in staff training
http://www.computerworld.com.au/article/390066/imf_hack_warning_others_invest_staff_training/
Hamish Barwick (Computerworld)
14 June, 2011 13:23
Staff training about simple email threats may have helped the International Monetary Fund (IMF) in New York from being hacked by a targeted malware attack, according to one analyst.
According to Bloomberg, the hack’s perpetrators obtained a “large quantity of data,” including e-mail and other documents during the intrusion.
Ovum’s UK based IT security analyst, Graham Titterington, said in a statement that many security mistakes occur within banks and other financial institutions because staff have not received sufficient training on threats.
[ With the increasing threat of cyber crimes, protect yourself and stay informed on the latest news with Computerworld's Security newsletter ]
“People are people and have innate vulnerabilities with respect to trusting the wrong people, accepting inducements, or simply having more pressing concerns at the time they are approached [via email],” he said.
While there was “no magic bullet” to prevent a cyber attack, the IMF could have also put more security measures in place.
“Most information theft attacks are launched through an Internet facing application in the corporate gateway, attacking vulnerabilities in applications using relatively predictable strategies such as SQL injection or scripting attacks,” Titterington said.
“So improving the coding standards of applications is a major step, or alternatively protecting applications by screening them with an application layer firewall.” According to Titterington, access control to systems was another area where controls were frequently circumvented, as attackers steal the credentials of legitimate users through a number of types of attack.
“Spyware is often inserted into the target organisation well before the main attack takes place to acquire this information. Monitoring data movements, data encryption, and data loss prevention systems can also reduce the loss of information directly from electronic systems, particularly with regard to high volume theft,” he said.
In the case of the IMF, data monitoring did flag the data breach, but not soon enough to prevent the hack taking place. “However, security technologies themselves are not universal panaceas, even when the vulnerabilities have been dealt with,” said Titerington.
“Data loss prevention is cumbersome and can obstruct legitimate business if it is not perfectly tuned while encryption is only as good as key management and brings the risk of losing all access to your data if you lose the key.”
Got a security tip-off? Contact Hamish Barwick at hamish_barwick at idg.com.au
Follow Hamish Barwick on Twitter: @HamishBarwick
Follow Computerworld Australia on Twitter: @ComputerworldAU
Shaw Capital Management Factoring: Mortgage Rates Decline; 30-Year Fixed At 4.63% – Freddie
http://online.wsj.com/article/BT-CO-20110512-713709.html
MAY 12, 2011, 10:32 A.M. ET
DOW JONES NEWSWIRES
Mortgage rates, including the average rate on 30-year fixed mortgages, declined again this week, according to Freddie Mac’s (FMCC) weekly survey of mortgage rates.
“Mortgage rates continued to decline this week following a mixed employment report,” Freddie Chief Economist Frank Nothaft said, noting the economy added the most workers in 11 months in April, though the unemployment rate rose to 9%, its highest reading since January.
Rates had slumped for much of last year, setting record lows in the process, as yields on Treasurys slid amid economic uncertainty. Before recent declines, rates had been rising this year. Mortgage rates generally track the yields, which move inversely to Treasury prices. Yields moved back near their lows of the year Thursday morning as investors sought save-haven investments with weakness in commodities and global equities.
Source: Freddie Mac
The 30-year fixed-rate mortgage averaged 4.63% for the week ended Thursday, down from the prior week’s 4.71% average and 4.93% a year ago. Rates on 15-year fixed-rate mortgages were 3.82%, down from 3.89% the previous week and 4.3% a year earlier.
Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 3.41%, down from 3.47% the prior week and 3.95% a year earlier. One-year Treasury-indexed ARMs were 3.11%, down from 3.14% the prior week and 4.02% a year earlier.
To obtain the rates, the fixed-rate mortgages required payment of an average 0.7 point, while the five-year adjustable required 0.6 point and one-year adjustable required a 0.5 point. A point is 1% of the mortgage amount, charged as prepaid interest.
-By Matt Jarzemsky, Dow Jones Newswires; 212-416-2240; [email protected]
Shaw Capital Management Factoring: Oil Scarcity and its impact on the Global Economy
http://www.oyetimes.com/business/44-markets/10984-oil-scarcity-and-its-impact-on-the-global-economy
TUESDAY, 03 MAY 2011 10:11
WRITTEN BY GLEN ASHER
In the latest edition of the International Monetary Fund’s World Economic Outlook publication, the IMF dedicates a chapter entitled “Oil Scarcity, Growth and Global Imbalances” to an examination of the world’s oil markets and the impact of growing oil scarcity on the world’s economy. In this document, the IMF seeks to answer the current status of oil scarcity, how oil scarcity will impact the global economy and how oil scarcity will impact economic policies around the world.
Now that the price of both Brent and West Texas Intermediate seem solidly positioned above $100 per barrel for the first time since 2008, this is a timely study. Demand for oil has risen and, for some major consumers such as China, consumption levels have reached new records. Since oil is central to the world’s economy, the impact of oil price volatility is key to economic growth and security. While oil prices have risen and fallen over the past 4 decades, it is only now that the issue of looming oil scarcity is becoming increasingly discussed.
The authors of the report believe that the world is, in fact, reaching a point of increasing oil scarcity. Demand from emerging economies is acting in concert with decreasing levels of growth in supply resulting in increasing tension in the world’s oil markets. The IMF distinguishes between an absolute drop in supply (decreasing absolute daily oil production level) and a drop in the level of oil supply growth. If oil supply growth were to drop by one percentage point, annual global economic growth would slow by an annual rate of one-quarter of a point over the medium to long term. On the other hand, a steady decline in absolute oil supply levels would have a much greater negative impact on the global economy even if there is an increase in substitution of other energy sources in the place of oil. As well, the pace of the rise in oil scarcity will also affect the level of impact on the world’s economy; should there be sudden downward trends in supply, the economic impact will be far greater than if supply constraints were gradual.
Let’s start by looking at the concept of oil scarcity and the extent of the issue. To put the importance of oil to the world’s economy into perspective, oil is a key factor in production and transportation and is the world’s most widely traded commodity with world exports averaging $1.8 trillion annually over the years 2007 to 2009, about 10 percent of global exports. Oil prices generally follow the economic law of supply and demand. When demand rises, if the supply is steady, prices will generally rise which will ultimately result in both an increase in supply and a drop in demand. The price of oil generally reflects the opportunity cost of bringing an additional barrel of oil to the market place. In general and over time, a high price generally implies that oil (or any other commodity) either is (or is anticipated to be) scarce while a low price generally implies abundance. Short term market fluctuations can occur that will lead to price spikes such as those seen in the 1970s OPEC embargo or the Gulf War in 1991 when the price spiked to just over $40 per barrel from just under $10 per barrel just five years earlier. Over the longer term, oil price changes generally appear to be relatively smooth with a gentle rise prior to the rapid rise and fall in 2008 – 2009 which reflected issues in the world’s economy rather than oil market macroeconomic factors.
The concept of oil scarcity is a contentious one. Many authorities in the oil industry now acknowledge that the world may well be entering a point of supply constraints. The decline in oil availability reflects the constraints placed by nature on the ability of the industry to profitably explore for and produce reserves. When prices are low, the oil industry generally reduces capital expenditures which places downward pressures on supply. On the other hand, mounting oil prices have resulted in technological advancements that have impacted industry’s ability to bring certain reserves to market, for example, the advent of both deep water drilling and multi-stage hydraulic have allowed the industry to invest in higher risk/lower productivity play types. It is the widespread use of enhanced technology that is now depressing natural gas prices in North America where both horizontal drilling and multi-state fracking have resulted in an oversupplied natural gas market.
The scarcity of oil is also related to the properties of the commodity. Oil has unique physical properties that make substitution difficult, particularly in the chemical industry where it forms the feedstock for many of the items that we use in our daily lives. If substitutes for oil for these products were found, oil supply constraints would have less of an impact on prices since rising demand for the substitute would dampen oil price volatility.
One of the fundamental factors that impacts the world’s economy is the fact that oil is the world’s most important source of primary energy with over 33 percent of the world’s total with coal accounting for 28 percent and natural gas accounting for 23 percent. In recent years, the world has experienced increased rates of growth in energy consumption, particularly from China who is now the world’s number one overall energy consumer. For the foreseeable future, growth in China’s economy will be the primary driver of increases in global energy use. In general, the world’s developed economies (OECD nations) expand with little increase in energy usage, however, those non-OECD nations in lower income countries have a one-to-one relationship between economic growth and energy usage. This means that a one percent increase in real per capita GDP is accompanied by a one percent increase in per capita energy consumption as shown in this graph:
Note that the share of the world’s primary energy consumption for the United States, Europe and Japan is dropping while it is rising for India and the Middle East and rising markedly for China (blue line) as shown in this graph:
Given the one-to-one relationship noted above, the IMF forecasts that China’s energy consumption is predicted to double by 2017 and triple by 2035 in comparison to its 2008 level. In 2000, China consumed 6 percent of the world’s overall oil consumption, this rose to nearly 11 percent in 2010 with coal accounting for 71 percent of total energy consumption and oil for 19 percent.
The IMF study also examined the elasticity of oil. Elasticity is defined as “…the ratio of the percent change in one variable to the percent change in another variable. It is a tool for measuring the responsiveness of a function to changes in parameters in a unitless way…” The IMF found that an oil price increase of 10 percent leads to only a 0.2 percent reduction in demand (low elasticity). Over a longer term of 20 years, that 10 percent price increase reduces demand by only 0.7 percent, a very insignificant amount. When looking at oil demand based on income, over the short-term, a 1 percent increase in income results in a 0.68 percent increase in oil demand; this drops to 0.29 percent over the longer term. This is far lower than the increase in demand for total energy consumption meaning that as incomes rise, over the short-term, people increase their demand for oil but over the longer term, while their demand for all energy sources increases, they substitute other fuels for oil. It is interesting to note that the demand for oil among the developed nations of the OECD changes very little when the price of oil rises when compared to the demand of non-OECD nations. This is likely because during the oil price shocks of the 1970s and 1980s, nations such as the United States and France switched from oil to other means of power generation such as coal and nuclear. The economies of the more developed nations are somewhat more immune from increases in the price of oil since their power generation does not require the use of oil. The same cannot yet be said for those nations with less mature economies who still rely more heavily on oil.
What impact will increasing oil scarcity have on the global economy? Strong and increasing oil demand is expected from emerging market economies where rapid income growth is being experienced. Since oil production appears to have reached a plateau over the past decade, supply and demand could well fall out of balance. As I noted above, even a drop in the average growth rate of oil production (not a drop in the absolute level of oil production) will have an impact on the world economy. To put the following scenarios into perspective, oil production has grown at a historical rate of 1.8 percent annually.
Now let’s look at two of the IMF oil scarcity scenarios:
1.) Oil production growth drops by a persistent 1 percent annual growth rate: In this case, an immediate oil price spike of 60 percent is predicted by the IMF models. Over a 20 year period, a 200 percent increase in the price of oil is predicted. This will result in a massive wealth transfer from consuming nations to exporting nations and will result in a much lower GDP for oil importers that is at least partially offset by a higher GDP for oil exporting nations. On the upside, increased demand for goods from oil importers results in increased exports of these goods by the wealthier oil exporting nations. Overall, the IMF feels that global economic growth is slowed by less than one-quarter of a percent annually over the medium and long term if oil production growth slows gradually.
2.) Oil production growth drops by a persistent 3.8 percent annual growth rate: This scenario is more closely related to scenario anticipated by the proponents of “peak oil”. In this case, an immediate oil price spike of 200 percent is predicted by the IMF models. Over a 20 year period, an 800 percent increase in the price of oil is predicted. Price changes of this magnitude have never been experienced by the world’s economy and the impact would make it very difficult to carry out monetary policy. The economies of emerging Asia would be highly impacted since their economic growth is at a one-to-one ratio with energy usage. As well, the economies of those nations that have weak links to oil exporting nations, such as the United States, would be highly impacted. It is likely that if oil output decreased substantially, oil exporting nations might well reserve an increasing share of their production for domestic use, shrinking the amount of oil available for the world’s oil markets. This could have the ultimate result of shrinking the world’s supply of oil far faster than would normally be anticipated. A persistent decline in oil production growth of this size would result in larger current account imbalances (exports minus imports) among nations with oil importing nations experiencing a 6 to 8 percentage point drop in GDP over the long term.
The state of oil scarcity can be mitigated by changes in government policy toward the development of sustainable sources of energy, particularly among nations that are net importers of oil. Changes in policy will also be required for nations that use subsidies to keep energy costs reasonable for their citizens. As oil scarcity results in higher prices, the fiscal cost of fuel subsidies could overwhelm the fiscal situation of these governments. Removing such subsidies has often resulted in civil unrest, however, on the other hand, the reduction in subsidies would also allow market forces to work their way through the system to reduce demand as prices rise. In place of subsidies, these governments will need to implement an enhanced social safety network to ensure that their citizens do not face increased poverty.
Governments around the world face a conundrum; by ignoring the issue now, the world’s addiction to oil continues to rise unabated. By acting too soon to curtail oil consumption through the use of policy interventions, the world’s economy could be thrown into a premature economic malaise. Since the scarcity of oil is a global problem, it is critical that governments throughout the world act in a cooperative manner to ensure that the ultimate outcome is one that is advantageous to all of us. The sooner that action is taken, the better for everyone.
Shaw Capital Management: Bin Laden related malware prompts FBI warning
http://www.infosecurity-us.com/view/17720/bin-laden-related-malware-prompts-fbi-warning-/
03 May 2011
Black hat search engine optimization (SEO) attacks are nothing new, but the surge in internet use since the announced death of the terrorist leader has led the FBI to issue a quick warning about malware-laden search results on the internet.
With big news comes big ruse, so the FBI was wasted little time in issuing apress release warning about poisoned internet search results and email attachments. Less than 48 hours after the occupier of the number one spot on its most wanted list was killed by a US military operation, the FBI is asking the general public to proceed with caution when reviewing Osama Bin Laden related emails, search results, attachments, and media files.
The warning reads: “The FBI today warns computer users to exercise caution when they receive e-mails that purport to show photos or videos of Usama bin Laden’s recent death. This content could be a virus that could damage your computer. This malicious software, or ‘malware’, can embed itself in computers and spread to users’ contact lists, thereby infecting the systems of associates, friends, and family members. These viruses are often programmed to steal your personally identifiable information.”
The FBI urged the public to report any suspicious material to the Internet Crime Complaint Center (IC3), while also asking for increased skepticism of items received from trusted sources.
As Infosecurity reported earlier today, numerous IT security vendors have identified malicious domains linked to malware when reviewing Bin Laden related search results.
Shaw Capital Management Factoring: Netflix CEO: We don’t want World War III with cable
http://money.cnn.com/2011/05/03/technology/netflix_streaming_growth/?section=money_latest
By Julianne Pepitone, staff reporter May 3, 2011: 6:19 PM ET
NEW YORK (CNNMoney) — Netflix CEO Reed Hastings is pleased with his company’s massive growth, but he fears that getting too large will start “an Armageddon” with cable networks.
Hastings talked about Netflix’s “niche” philosophy — a Goldilocks-esque business plan of staying “not too big, not too small” — in a panel discussion Tuesday at the Wired Business Conference in New York City.
Panel moderator Chris Anderson, the editor in chief of Wiredmagazine, asked Hastings who is “most threatened” by Netflix as it expands its streaming video content.
“We’ve consistently said getting into current season [TV] or newer movies would not be profitable for us,” Hastings said. “It would be an Armageddon. It would be World War III, and we likely wouldn’t survive that battle.”
Anderson then read a quote from a Comcast exec who said that Netflix doesn’t compete with TV, it competes with reruns.
Hastings acknowledged that his company doesn’t expect to compete on sports and breaking news, which are suited to live broadcast. “[Netflix is] not every single thing all of you folks want to watch, but it’s $8 a month,” he said. “It’s choosier content.”
Still, it’s clear that one of Netflix’s top priorities is upgrading the quality and depth of the content it has available for instant streaming. On top of licensing its first original series — “House of Cards,” starring Kevin Spacey and due out in late 2012 — Netflix has recently snapped up some choice reruns, including “Mad Men” and the first season of “Glee.”
“You have to make a deal with the content owner,” Hastings said. “Luckily we’re bigger now, so we can write the check and get the content flowing.”
That’s a costly and time-consuming process, but it’s been in the game plan all along. Netflix (NFLX) attracted most of its giant subscriber base — which now tops 22 million in the U.S. — through its DVDs-by-mail rental service. But streaming has been the real goal ever since the company’s inception in 1997, according to Hastings.
“We had set up the whole business essentially for streaming, but the network wasn’t big enough years ago,” he said. “But in 2005 we clicked on YouTube and watched cats on skateboards — and we thought, it’s here! Since then, we’ve had so much fun finally delivering on our name: Net. Flix.”
Shaw Capital Management Factoring: Latest Indictment is No Joke for Lampoon
http://www.labusinessjournal.com/news/2011/mar/21/latest-indictment-no-joke-comedy-company/
By Joel Russell
Monday, March 21, 2011
Fraud case against top execs could complicate sale of comedy company National Lampoon.
Last week’s indictment of two top officers at National Lampoon Inc. complicates the outlook for the comedy company that has done business under a cloud for years.
The U.S. Justice Department on March 15 charged Chief Executive Timothy Durham and Chief Financial Officer Rick Snow with 12 counts of wire and securities fraud. The alleged misconduct involved an Akron, Ohio-based finance company that apparently made loans to prop up National Lampoon, a West Hollywood-based film production company, and other Durham-controlled businesses as well as supporting his lavish lifestyle.
The company’s previous chief executive, Daniel Laikin, is serving time on conviction in a securities fraud case. Laikin and Durham were business associates.
Matthew Rosengart, a partner in the West L.A. office of law firm Manatt Phelps & Phillips LLP and who is not affiliated with National Lampoon or the case, said that if Durham acted criminally to benefit National Lampoon, and those actions were within the scope of his job, the company could be found liable. So far, the company has not been charged or named in a legal action.
National Lampoon could be sold even before the legal proceedings end as part of a separate bankruptcy case regarding the finance company. But Rosengart said that the evolving legal situation will complicate any negotiations for a sale.
“Obviously the company is less attractive than it would be otherwise,” he said. “The buyer would have to take into account possible civil liability down the road.”
On the same day as the indictments, the Securities Exchange Commission filed a civil suit seeking $207 million in restitution to defrauded investors against Durham, Snow and another partner. Both Snow and Durham were taken into custody March 16. Snow was released the same day but Durham remained in jail pending a hearing Monday.
Durham and Snow’s legal troubles center on Fair Finance Co., a defunct factoring company formerly controlled by Durham, Snow and another partner.
“These defendants used a company with a decades-long track record in consumer finance to raise money to finance their personal businesses, lavish lifestyles and repay other investors with the promised return in the nature of a Ponzi scheme,” Daniel Hawke, regional director of the SEC in Philadelphia, told the Business Journal. The Philadelphia office has jurisdiction of the case because the alleged crimes took place in its region.
Messages left at National Lampoon offices were not returned.
Roy Black, Durham’s attorney in Miami, did not respond to an e-mail.
Lou Volpano, managing partner at Ascertain-ment Advisory Group, an entertainment consulting firm in Newport Beach, said that many producers and comedians in Hollywood still like the National Lampoon name. In the Laikin and Durham years, a stream of producers and studio executives wanted to help revitalize the company, but soon realized that the top people at National Lampoon didn’t know how to produce movies and even shunned help when offered.
“They never really had anyone working for them who had experience in film production,” Volpano said. “Everyone in Hollywood wondered what those guys were doing running that company.”
National Lampoon enjoyed its biggest successes in the 1970s and 1980s, when it produced films such as “Animal House” and the “Vacation” series.
Accounts receivable
Before Durham’s arrival in 2002, Fair Finance borrowed money by selling certificates to individuals and used the proceeds to purchase accounts receivable from businesses at a discount. It would then collect the receivables, and so long as the collections exceeded the purchase price and expenses, the company made a profit.
After Durham gained control of Fair Finance through a leveraged buyout, he switched from factoring to making direct loans to himself, partners and companies they controlled. The loans were never repaid, so Fair Finance allegedly started taking money from new investors to pay certificates that came due.
Laikin, who was the main recipient of loans, was convicted of manipulating the price of National Lampoon’s stock and is serving a four-year-sentence.
Although National Lampoon isn’t named in either the Justice Department indictment or the SEC suit, the company may have benefited from the Fair Finance scam through loans Durham made personally to the company. Most of the $230 million in allegedly fraudulent loans made by Fair Finance went to Durham, his associates or two investment companies he owned, and then reloaned to companies Durham controlled.
In addition to National Lampoon, Fair Finance loans were made to Durham’s car magazine, restaurants, Internet companies, rubber reclaiming company and bus leasing firm.
Meanwhile, Durham was living a lavish lifestyle. He took out a $250,000 loan to remodel his garage and a $150,000 loan to spend at a casino. Together, the partners purchased a $3 million private jet, a $6 million yacht and collectible cars worth $7 million.
“After receiving loans from Fair, many of these businesses failed and were never able to repay the money they borrowed, while others, with the benefit of continued loans from Fair, struggled as unprofitable entities for years,” the Justice Department indictment states.
Currently, National Lampoon’s shares trade on the Pink Sheet at a price of 3 cents a share.
Shaw Capital Management Factoring: JAPAN DISASTER FROM A TECHNOLOGICAL VIEW
http://www.2600.com/news/view/article/12067
Posted 15 Mar 2011 02:15:16 UTC
The following comes to us from one of our friends and correspondents in Japan. After reading, please do whatever you can to lend a hand.
*****
Just a few notes on the situation in Japan.
As you have heard, last week on Friday, in the middle of the afternoon, on a normal working day, we experienced the largest earthquake that I have ever experienced in living 20 years in Japan. It started like a “normal” quake but just kept on increasing in intensity for an extraordinary long time. I scurried across the floor to get my desk and put on my hardhat. The company provides us with hardhats and emergency supplies in a belt bag for just this eventuality.
Immediately, cell phone coverage was effectively dead as the circuits were overloaded. It remained so for several hours after the quake though it was possible to get through to numbers if you were lucky, though almost all calls ended in failure.
Our mobile phones’ IP Internet service remained active and usable. Twitter became the most reliable communication method and realtime news about the situation came in all the time. I’m subscribed to several earthquake alert services on Twitter and quickly realized which area had been affected. Soon after the Tsunami warnings came in via mail, and Twitter followed with what seemed bizarre commentary from friends who were updating realtime about the amazing scenes they were watching live on TV.
After several strong aftershocks during the afternoon, we were faced with the problem of getting home. All trains in the Tokyo area had stopped and didn’t plan to restart that day except, amazingly for the Shinkansen which started again within a few hours.
I posted my situation on Facebook and within minutes several friends offered me a place to stay the night. I managed to chat with one of my friends over Skype chat on my iPhone and headed off in his direction. Near his house I called him by voice on Skype on the iPhone.
The walk over to his apartment only took about 30 minutes but it was an amazing sight. Thousands of people were walking calmly along the sidewalks next to the main roads. The convenience stores were stripped bare of produce. All bentos, bread, pot noodles and other food stuffs were gone. Also mobile phone chargers and batteries were immediately sold out. All bicycle shops were sold out as people who had a long walk purchased one there and then to ride home on.
Mobile phone shops were kept open to allow people to charge their phones and NTT call boxes were set to allow free calls within Japan. Long lines were reported at the phone boxes as there are so few public call boxes left now in the streets and public places.
My home phone was not available as it is no longer provided via the analog copper cable but is an IP phone that is connected to the DSL fibre router provided by the phone company. During a power failure it is dead. We were warned about this when we subscribed for the fibre Internet service. I heard that landline to landline calls were getting through.
The following morning I searched on Google Realtime search for the name of the station and train lines nearby. From 1 minute old Twitter messages I could see people complaining about the 500m lines outside the stations. Other people who had boarded the train were tweeting how dangerously crowded the train was and how, once they had reached the platform it had taken them an hour to actually board the train.
I decided to sit it out and caught the train back later when it was less crowded, knowing in advance that the station was relatively normal.
Many people were able to receive Skype calls on their iPhones or PCs from relatives abroad but were unable to get through to their family in the same city due to problems with the mobile voice network. We also determined by coordinating over Twitter that SMSs were not getting though. Some test messages never got through at all.
One more piece of technology which has proven not to work well is the Earthquake pre-warning system. New mobile phones make a sound and display a message before incoming earthquakes as the warning can be broadcasted before the relatively slow moving ground waves arrive. There was no warning for the first very large quake, which was a total failure, and then random warnings throughout the night for relatively moderate quakes. When a whole room full of people’s phones suddenly sound an alarm, it really adds to the fear factor.
On the subject of over-the-air broadcasts, Japanese TV excels at keeping people informed. Every few months we get a tsunami warning and a map is projected over the TV program showing the areas in danger. There are remotely controlled cameras in all the major ports that NHK controls which usually in the end show tsunamis of 10 cms or so rolling in. The aerial footage that we have all seen is from the TV company helicopters, it was broadcast live. It is routine for them to head out over the affected areas at the first sign of an earthquake.
Across the Kanto plain, where Tokyo and the surrounding areas lie, the US military broadcasts on 810AM. During emergencies English speakers can get information from this station. I haven’t felt the need to listen to this, yet. NHK is running 24hr bilingual news on their net service.
Concerning the nuclear crisis, the French Embassy advised their citizens to leave Tokyo unless absolutely necessary whereas no notification has been given by others. Some non-Japanese friends have just left the country.
I’m following the news, and checking against outside experts’ analysis. The information seems to match, but the explosions don’t seem to be part of the expected failure plan. I guess there is not really a chance to test the design of a nuclear power station before it fails.
As far as I understand, the power plants were all automatically scram’ed (by the “safety control-rod axe man”) i.e., made safe immediately. The reaction was dampened with the control rods but the problem was then to dissipate the remaining heat as the reaction subsides. At this point, the cooling and emergency cooling failed. The water started to get super-heated breaking down giving off hydrogen and oxygen which, when it was let out into the containment building to reduce pressure, led to the explosion. When the officials pumped seawater into the cooling system, you know they have given up on trying to save the reactor as it usually requires very pure water to avoid corrosion. I think, after that, you basically have to decommission the reactor. It is certainly a mess that will take years to clean up.
I’m generally in favour of nuclear power, but building power stations in such an earthquake and tsunami prone area does not seem wise. I don’t understand why Japan doesn’t build thermal power stations with the abundant heat from volcanic sources.
Also, it’s well known that the nuclear industry in Japan is scandal ridden, so people are really looking closely at what they are saying and fact checking.
I will reserve panic to when the US withdraws its personnel en masse from their bases near Tokyo.
Due to the damage to the power stations, there are rolling blackouts scheduled but they haven’t come into effect yet. It is uncertain how area by area blackouts will work. Will the trains stop? Will the ticket machines work? Will there be lights in the stations on lines that are running? No one knows. I expect Shibuya and Shinjuku will be dark tonight.
We found out the schedule for the blackouts from what was obviously a pdf created from a copy of a fax! After announcing the blackout, TEPCO (the electric company)’s website went down due to the load. I managed to get a copy from someone who had archived it on their public Dropbox folder. They announced the location on Twitter. I posted this to my mailing list for local English speakers and people were soon helping each other to translate it and tell others who were having difficulty with the Japanese.
Google’s disaster relief page has also been useful and we were able to confirm that one friend in the badly affected area was alive by seeing a confirmation message posted by a family member on his entry in the people finder section.
Looking back, the thing that saved the day for me was TCP/IP. All services web, chat, ip-phone, mail, except the phone company’s mail server, worked reliably. SMS and mobile voice phone cannot be relied upon even if their network is working.
Lastly, I must note that for Tokyo this quake was an inconvenience. For Northern Japan it is a disaster which has literally wiped whole communities off the map. Only the roads remain where bustling towns of many thousands stood hours previously. People have been rescued 10s of kilometers out to sea
sitting on house roofs. The office I work for has branches around the country and as of Monday morning 200 people were not able to be accounted for. Please ask everyone to give generously to the international relief agencies that are supporting the efforts. Please give to those agencies that you already know, as several hundred fake domains were registered over the weekend in order to scam people into donating to fake relief sites.
“Off The Hook” listeners in Tokyo, at least, are doing fine.
Stuart – Tokyo