Archive for November, 2009


Default Swap Reforms Roiled as Aiful Tests Settlement (Update1)

 

Link to original: http://www.bloomberg.com/apps/news?pid=20601109&sid=aANN.DJq5h1E#

 

 

 

By Abigail Moses and Shannon D. Harrington

Nov. 27 (Bloomberg) — Wall Street’s system for determining payments on derivatives linked to the debt of defaulted companies is showing cracks less than a year after securities firms changed practices to avoid “Draconian” regulation.

Credit-default swaps tied to Thomson SA, the Paris-based owner of film processor Technicolor Inc., paid some holders 30 percent less than those with contracts expiring a day later. In Japan, owners of swaps on Aiful Corp. haven’t been compensated, though one of its banks said the consumer lender skipped loan repayments. Dealers can’t agree whether to reimburse investors in Mexican cement maker Cemex SAB’s debt swaps.

Disparities are arising in spite of practices adopted in April and July to standardize settlements and curb risk in a market that exacerbated the worst financial crisis since the 1930s by contributing to the downfall of American International Group Inc. Analysts at Bank of America-Merrill Lynch, Barclays Capital and UniCredit SpA say changes are needed as dealers examine how to interpret existing rules to maintain investor confidence.

“The first cracks are being shown in the protocols,” said Edmund Parker, head of derivatives at Chicago-based law firm Mayer Brown LLP in London.

The rules are being tested as the global default rate rises. The rate for companies ranked below investment-grade reached the highest since the Great Depression in October and will peak at 12.5 percent next month, Moody’s Investors Service said Nov. 5.

Lawmaker Ammunition

Flaws in the system may provide ammunition to President Barack Obama and lawmakers who want to rein in derivatives, including credit-default swaps, which rise in price as investor confidence decreases and pay off when a borrower fails to adhere to its debt agreements.

Regulators demanded more transparency after the meltdowns 14 months ago of Lehman Brothers Holdings Inc. and AIG, two of the largest traders, froze credit markets and worsened the first global recession since World War II.

The swaps had been the world’s fastest-growing market, with contracts protecting against defaults on as much as $62 trillion at the end of 2007, almost 10 times the amount of the U.S. government’s debt outstanding, according to the International Swaps & Derivatives Association, a trade group based in New York. The swaps totaled less than $632 billion in 2001 and the figure is $26 trillion now.

Hedge fund manager George Soros has called the market “unsafe,” and billionaire investor Warren Buffett once likened the derivatives to “financial weapons of mass destruction.”

Revenue Stream

Banks are making changes to avoid stricter rules imposed by regulators, said Atish Kakodkar, a CreditSights analyst in New York.

“The risk of over-regulation is real,” Kakodkar said in a Nov. 15 research report. “Self-regulation in the credit derivatives market seems to be driven largely by the need to pre-empt any Draconian regulation.”

Five U.S. commercial banks, including JPMorgan Chase & Co., Goldman Sachs Group Inc. and Bank of America Corp., were on track to earn more than $35 billion this year trading unregulated derivatives contracts of all types as of August, according to data compiled by Bloomberg.

Credit-default swaps are derivatives, contracts with values derived from assets or events, including stocks, bonds, commodities, currencies, interest rates or the weather. Banks, hedge funds and insurance companies use the swaps to insure bonds and loans against default or to speculate on the creditworthiness of countries and companies.

Failure to Pay

If a borrower fails to adhere to its debt commitments, bondholders who own swaps get paid the debt’s face value in exchange for the bonds. Those that don’t own the underlying bonds get the face value in cash minus the debt’s current market value as determined by industry-run auctions where holders of the securities sell them to the highest bidders.

Dealers and investors standardized the contracts this year to make them easier to trade through clearinghouses, which act as buyers to sellers and sellers to buyers, preventing a single default tripping a domino-like financial system catastrophe.

As part of that effort, ISDA formed regional committees of 15 dealers and investors in March to make binding decisions on when contracts are triggered. The committees base decisions on publicly available information such as regulatory filings, press releases and news articles. Swaps usually are triggered by one of three events in most countries: bankruptcy, failure to pay or debt restructuring, including a reduction or postponement in principal or interest. Under the new rules, traders eliminated restructuring as a credit event in the U.S.

Successful Auctions

Traders successfully auctioned debt to settle contracts linked to 41 companies and Ecuador’s government this year, with about half of those happening since ISDA created the committees.

“The determinations committee provides one place where we can resolve a lot of these issues centrally,” said Athanassios Diplas, global head of counterparty portfolio management in New York for Frankfurt-based Deutsche Bank AG and co-chair of the ISDA panel that wrote the protocols. “Imagine if we were to face all of this in the world where we had to arbitrate potential disputes bilaterally. That would be complete chaos.”

The new protocols helped eased the market’s stigma, with the net amount of protection bought and sold rising to $2.6 trillion as of Nov. 13, the highest since at least February, Depository Trust & Clearing Corp. data show.

Credit-default swaps on the Markit iTraxx Crossover Index of 50 companies with mostly high-yield credit ratings has fallen to 558 basis points, from as much as 1,100 basis points in March, according to JPMorgan Chase & Co. prices.

Thomson provided the first test of the procedures for settling contracts triggered by a restructuring in Europe when it said in August it was deferring payments on $72.5 million of 6.05 percent private notes due this year.

Multiple Auctions

The system for restructurings uses multiple auctions that set different payouts based on swap expiration dates. Dealers couldn’t settle the Thomson contracts with simpler failure-to- pay procedures that produce one recovery value because they were unable to prove the electronics company defaulted.

Asked in a July conference call with investors whether Thomson still owed the money, Chief Executive Officer Frederic Rose responded, “Since I am not a qualified lawyer, I prefer not to answer that question.” Marine Boulot, a Thomson spokeswoman in Paris, declined to comment.

To determine the size of the payouts on contracts covering $2 billion in debt, bonds and loans were split by maturity date ranges into three so-called buckets and sold at auction.

Contracts that expired on June 20, 2012 — the first bucket’s latest date — sold for 96.25 percent of the face amount, meaning swap holders received 3.75 percent of the amount covered. Swaps expiring a day later paid 34.875 percent because the debt in that bucket went for 65.125 percent.

Too Few Securities

Holders of June 20 swaps covering 10 million euros in debt got 375,000 euros, while those with June 21 contracts received almost 3.5 million euros. Swaps that terminated after Oct. 24, 2014, paid the most, 36.75 percent.

The disparity was a result of too few securities in the first bucket to settle swaps, according to Matthew Leeming, a London-based strategist at Barclays. “An imbalance of supply and demand for the deliverables can affect the recovery rate,” he said in a note.

Because they were part of industry indexes, swaps referencing the company “dwarfed the amount of Thomson debt,” said Teo Lasarte, an analyst at Bank of America-Merrill Lynch in London.

The more swaps there are, the more investors with stakes in the contracts need bonds to settle them. About 81 million euros- worth of debt was auctioned from the first bucket, compared with 221 million euros and 148 million euros from the second and third, according to data released by auction administrators Markit Group Ltd. and Creditex Group Inc.

Sufficient Debt

Lasarte favors changing rules governing indexes so companies in them have enough debt available to produce settlement auctions that don’t cause distortions.

“To strengthen the robustness of this product, there are some issues to be solved,” said Tim Brunne, a UniCredit strategist in Munich.

Leeming of Barclays said in a report to clients that the Thomson settlement “raises questions regarding the future of restructuring as a credit event.”

Banks that bought contracts on loans to Kyoto-based Aiful aren’t being paid because ISDA’s determinations committee ruled that there isn’t sufficient evidence to trigger swaps as the company and its lenders hold confidential restructuring talks.

Suspended Payments

Aozora Bank Ltd., one of Aiful’s creditors, said in a statement to the ISDA committee that the company “suspended scheduled payments of loan principal to all of its lenders” on Sept. 30. The committee rejected the request on Oct. 19 because the protocols only allow it to consider “publicly available information.” If the “sole source” of that evidence bought or sold swaps, it isn’t deemed publicly available. Aozora has said it owns some Aiful swaps.

Katsuyuki Komiya, a spokesman for Aiful, declined to comment.

Contracts protecting a net $1.36 billion of Aiful’s debt were outstanding as of Nov. 6, more than any other Japanese company, according to New York-based DTCC. As much as $238 million more of Aiful’s debt is protected through credit swaps based on indexes in which the company is a member. Aiful is meanwhile seeking to secure a credit line from Sumitomo Trust & Banking Co., its main bank, two people familiar with the matter said.

Aiful Swaps

The value of Aiful credit-default swaps that mature in December plunged on speculation they may expire without being triggered. Contracts protecting 100 million yen ($1.2 million) of Aiful debt from default through Dec. 20 dropped to 10 million yen upfront, from 55 million yen on Oct. 15, according to a trader who asked not to be identified because the prices are private.

The Japanese Association of Turnaround Professionals, which is mediating Aiful’s so-called alternative dispute resolution process, is forming a group of bankers, lawyers and government officials to study whether talks between companies and creditors on rescheduling debt payments should trigger swap payouts, said Miyako Hara, an executive secretary for the trade group.

The ISDA determination committee was asked on Oct. 9 to rule that swaps linked to Monterrey, Mexico-based Cemex should be paid out after the company agreed with lenders to extend the maturity on about $15 billion of debt for five years.

After four weeks of deliberations, the committee was deadlocked, and the issue will now be decided by an arbitration panel set up by ISDA. The panel will rule in December.

Struggling With Debt

The biggest cement maker in the Americas has struggled to repay debt since shipments started dropping in the second- quarter of 2006, before it paid $14.2 billion in July 2007 for Australian rival Rinker Group Ltd. Cemex has $19.67 billion of debt, according to data compiled by Bloomberg, and is rated B by Standard & Poor’s, five steps below investment grade.

Cemex spokesman Jorge Perez declined to comment.

The cost of credit-default swaps on Cemex surged as high as 1,500 basis points in March, or $1.5 million a year to protect $10 million of debt for five years, according to CMA DataVision, as the price of its 900 million euros of 4.75 percent bonds due 2014 dropped to 38 cents on the euro.

Credit-default swaps are “not a perfect product,” said J. Paul Forrester, a Mayer Brown partner and co-head of its derivatives and structured products practice. “These are difficult questions, and unfortunately as we continue to use this product and explore it we’re going to find that it has these sorts of issues,” he said.

To contact the reporter on this story: Abigail Moses in London at Amoses5@bloomberg.net; Shannon D. Harrington in New York at sharrington6@bloomberg.net;

Last Updated: November 27, 2009 07:26 EST

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The greed and manipulation continue.  Read what Shelley Stark, author of Hidden Treuhand:  How Corporations and Individuals Hide Assets and Money  (Universal Publishers) has to say about it now.

 

 

Link to the Vienna Review:

 

http://www.viennareview.net/shelley-stark-3173.html

 

What is wrong with these people….AIG and our alleged government oversight?  This is outrageous!  Anybody have any specific suggestions for how to apply pressure?  -GFS

 

A reader sent the comment and article below.

———————————————————————————————————-

 

G. Florence,

 

It looks like the good citizens of this country are continuing to be taken for a ride on the public bailout money express train.

 

 

Article from the Miami Herald

AIG Approves Pay Package for CEO Benmosche

The Associated Press

NEW YORK — American International Group Inc. on Tuesday said it will go ahead with a previously announced pay package for its new CEO Robert Benmosche of $7 million in cash and stock.

Benmosche, who took over as CEO of the embattled insurer three months ago, will receive an annual salary of $3 million in cash and $4 million in AIG common stock under the pay agreement.

AIG is under close government scrutiny after receiving a bailout package worth up to $182.5 billion from the government in exchange for an 80 percent stake in the company. That bailout package also includes restrictions on compensation for the insurer’s 100 highest-paid employees.

Earlier this month, a Wall Street Journal report said Benmosche had threatened to leave his post as he struggled to deal with the heavy government oversight and restrictions on what the bailed-out company could pay employees.

Earlier this month Benmosche acknowledged frustrations with the oversight in a letter to employees but said he plans to stay on the job.

The Wall Street Journal reported online Tuesday that Benmosche signed a noncompete agreement, and reiterated at a board meeting his commitment to stay CEO. AIG didn’t immediately return calls for comment.

Benmosche, former CEO of MetLife Inc., took over as CEO in August, replacing Edward Liddy, who was appointed CEO after the government bailed out the insurer in September 2008. The CEO’s compensation deal was approved by Treasury Department pay czar Kenneth Feinberg.

In August, AIG said it was aware of potential conflicts of interest related to the hiring of Benmosche as its new CEO, and would deal with any conflicts as necessary.

AIG, which is selling off its business units to help repay the massive government loan, had been reportedly in talks with MetLife about a possible deal for all or part of one of AIG’s largest foreign life-insurance units. MetLife is the nation’s biggest life insurer by assets.

Benmosche, because of his former executive roles at MetLife from 1998 until 2006, remains a MetLife shareholder.

Under the pay agreement with AIG, Benmosche will also be eligible for a yearly performance-based bonus of up to $3.5 million in stock.

http://www.miamiherald.com/business/nation/story/1350379.html

 

 TIME SENSITIVE REQUEST

Via fax: 202-224-9750/860-549-8478/866/317-2242 & US Mail

34 Glenburnie Road

Boston, MA 02132

November 13, 2009

Honorable Senator Joseph Lieberman

ATTN: Clarine Nardi-Riddle, Chief of Staff

706 Hart Office Building

Washington, DC 20510

RE: REQUEST TO BE AN EXPERT GOVERNMENT WITNESS REGARDING THE DEPARTMENT OF DEFENSE INSPECTOR GENERAL, ARMY AND FBI’S MODUS OPERANDI TO POSSIBLY COVER UP CERTAIN EVENTS LEADING UP TO THE FORT HOOD MASSACRE

Dear Ms. Nardi-Riddle:

Senator Lieberman seems to have it right when he indicates that the Fort Hood massacre was an act of terrorism. Consistent with the Senator Lieberman’s request for accountability; I would like to be a relevant government witness for the Senator’s hearings set for the week of November 16, 2009, concerning the Fort Hood massacre.

My name is Douglas Kinan. I am an Officer of the Court – an Assistant Deputy Register with the Massachusetts Trial Court. I am also a former employee of the Department of Defense.

As a Viet Nam Era Veteran, a taxpayer and a former employee of the Defense Contract Management Agency (“DCMA”) with first hand knowledge of how the Department of Defense Inspector General’s (“DoDIG”) manipulates investigations and covers up high crime and corruption in government, I can provide expert testimony showing a nexus to the Fort Hood massacre and the DoDIG’s direct role in covering up and/or ignoring reports, incidents and episodes, which would have prevented the senseless murders of innocent victims. The families of these victims deserve better treatment than what the DoDIG offers.

I believe my direct and independent knowledge gives me standing to be an expert government witness concerning the DoDIG’s role in the Fort Hood Massacre. Some of the same players who covered up and participated in heinous and egregious government crime and manipulated investigations over the past ten years are some of the same players that may be connected or may influence the outcome of the Fort Hood “investigation.”

Some current officials are: Hotline Director Leonard C. Trahan (DoDIG), L. Jerry Hansen (Army), James L. Pavlik (DoDIG), John R. Crane (DoDIG), and Uldric Fiore, Jr. (Army). Former DoD supervisor and convicted felon, Richard T. Race (DoDIG), supervised some of these same individuals who were complicit with serious crime. Recent retiree, Deputy IG, Thomas Gimble (DoDIG) was also involved in the cover-ups.

I shall provide expert testimony and government evidence to prove that signs were not “missed” as some have reported. Malfeasance, misfeasance and nonfeasance by these same individuals are a pattern that is repeated over and over again. These few officials are experts at changing the subject 2

and shifting the focus with false denials, perjured affidavits/declarations and other deceptions, as they have done in key investigations for years. One peripheral case that comes to mind is the changing stories and false official statements in the Patrick Tillman story.

Based on past practice, I shall provide expert testimony and evidence to prove that there is little or no chance that the Fort Hood crime victims will receive a fair, impartial or objective investigation and that a cover up by the DoDIG and Army is more likely than not.

I shall provide expert testimony that key players in the chain of command, controlling the outcome of the investigation are experts at creating facts, manipulating and slanting investigations with false official statements, false denials and silence. Their method of investigating each other with the intent of finding no wrongdoing is standard operating procedure and ensures that government crime and corruption promoted by the DoDIG’s office shall continue.

I shall provide expert testimony that the FBI and the DOJ has had knowledge of the verified criminal activity by several members of the DoDIG’s chain of command for many years and did nothing, which allowed and encouraged the crime and corruption to continue.

One of the strong-arm tactics to silence me is outlined in the attached email from U.S. Marshall, Frank Dawson who visited me at my job in the Suffolk County Courthouse on March 25, 2009, in an attempt to threaten me into silence. The DOJ is working so hard not to admit the obvious and to prevent me from being a government witness in any forum, by any means necessary.

I shall testify that U.S. Marshal Dawson threatened to place me in a national database as a “stalker” if I continued to report public corruption to the Assistant United States Attorney and Public Corruption Officer, Brian Kelly. Dawson said that my lawfully required reporting was “against the law” and that Kelly said it was “bothersome.” It should be noted that Public Corruption Officer, Brian Kelley and Supervisory FBI Agent John T. Foley, working together, have ignored the verified criminal activity outlined in my 30-page affidavit. Foley thought the DCMA frame-ups were amusing.

I shall provide a list of those innocent individuals who were framed with the participation and cooperation of a few individuals within the DoDIG’s office and the DOJ coupled with a list of the individuals who received promotions for providing false and/or tainted testimony. It should be noted that witnesses who provided false and or tainted testimony were “fast-tracked” to receive one, two, three and four grade promotions and remain on the favored list for future promotions because they have been identified as “team-players.”

PARTIAL BACKGROUND

As a former DoD employee with direct knowledge of the extensive criminal activity, including the frame up of innocent employees, I requested an investigation by DoDIG Hotline Director, Leonard Trahan, Jr., concerning the Defense Contract Management Agency, Chief Counsel, Bruce Krasker and his former Deputy Jerome C. Brennan’s insistence on framing innocent employees and other verified criminal activity, using millions of tax dollars to do it. Thus, I have first hand experience on how investigations by a few key individuals are manipulated to achieve “their” desired results.

A November 9, 2009, FBI Press Release states that the “FBI continues to work closely with the Department of the Army [and the DoDIG] in the joint, ongoing investigation into the tragic events that occurred at Fort Hood.” Consistent with the honesty, integrity, transparency and accountability needed by the Joint Terrorism Task Force (“JTTF”) in the Fort Hood massacre, consider the following: 3

One high level Senator’s Chief of Staff has described the DoDIG’s office as being “dysfunctional.” and wrote, “The main problem is management level mismanagement. The 18 SES persons in charge of that office are the big problem. Most are not suited for those positions. Most do not believe in the IG mission. We are working some issues. We have made some headway. We have had some setbacks. It’s like mission impossible. The easy way out is to give up. Quit. But I won’t do that. But don’t expect miracles or quick solutions. Heddell is ok so far. But he may suddenly leave with the upheaval in politics and go back to Labor IG. And then we are back to square one with Gimble or worse.”

According to a Department of Interior, Office of the Inspector General, Report of Investigation dated June 5, 2008, which I received, via FOIA, on December 30, 2008, the Director of the Defense Hotline for fraud, waste and abuse, Leonard C. Trahan, Jr., his supervisor, Assistant Inspector General, Investigative Policy and Oversight, James L. Pavlik, former Assistant Inspector General for Inspections and Policy, L. Jerry Hansen, former Chief Assistant Inspector General and a member of President Bush’s Council on Integrity and Efficiency, Richard T. Race, former IG, General Counsel, Uldric Fiore, Jr., and former Inspector General Joseph E. Schmitz acted in concert to cover up several fraud, waste and abuse investigations within the Rumsfeld Pentagon.

In a letter dated August 3, 2006, the President’s Integrity Committee established that there was “clear evidence” that Schmitz and others in his chain of command lied to Senator Grassley and “allowed a press release to be issued that contained false information.”

In his December 7, 1998 Memorandum to Lt. Colonel Citizen, Trahan entered false statements into the record to cover up the frame-up of two innocent DCMA employees, promotion fixing, well planned discrimination, heinous and violent acts against women and other public corruption. Trahan also lied in his June 28, 2006 sworn statement to National Security Agency Investigator W. Rod Biggs. In that same sworn statement, Trahan characterized DCMAE whistleblower and senior engineer Kenneth Pedeleose, who saved the DoD $34 million, as being “disloyal.”

In Pavlik’s undated “Executive Summary,” transmitting a fraudulent report to Senator Grassley on April 26, 2006, Pavlik lied. Trahan and Pavlik’s willingness to knowingly enter false statements into the government record to cover up DoD violations and manipulate investigations remains unchecked.

Trahan and Pavlik’s cover up concerning the DCMA’s promotion fixing, which the DCMAE ethics attorney characterized as “criminal,” ripples across the entire government and diminishes and discounts the merit-based promotion policy promised to all employees.

As to their character, on February 19, 2008, Richard T. Race pleaded guilty in Judge Brinkema’s court to “fraudulent banking transactions” and was allowed to “voluntarily retire,” Uldric Fiore, Jr. was removed for his participation in the retaliatory frame-up of DCMA whistleblower and senior engineer, Kenneth Pedeleose, for lying to Senator Grassley, the Secretary of Defense and everyone else and he went to work for Judge Advocate General, Lt. General Scott C. Black, L. Jerry Hansen was removed and he, too, went to work for Army. It should be emphasized that Pedeleose saved the DoD/government $34 million and in March 2008, his peers voted Pedeleose “Employee of the Year – 2007,” yet his deliberate and retaliatory frame up is currently on appeal. 4

Based on a proven track record for complicity with high crime in government, will the Fort Hood victims’ families be relieved by knowing who the key players are and how this investigation may play out?

Could the DoDIG have prevented these murders? I say yes. Here’s why: Concerning the frame-ups, Krasker boasted: “We (the Legal Directorate) can do anything we want. It’s called gaming. We can deny, we can delay…dismiss. We can manipulate the system any way we want.” Krasker can make this boast because he knew he would have cover from the DoDIG’s office and the Department of Justice. Trahan ignored the DCMA’s crime pattern and rationalized the frame ups this way: “There were two EEO cases in the District in which Mr. Kinan disagreed with the decisions made by [the Equal Employment Manager] and the [DCMDE Chief Counsel.] Instead of accepting those decisions “as reasonable people can disagree”, they became a ‘cause celebre’ for Mr. Kinan.” What “reasonable” person believes that framing an innocent person is okay? Trahan, a “retired Army CID agent” with approximately 40 years experience, should know that framing two innocent people is not “two EEO cases” – it’s framing two innocent people. It’s a felony. Trahan stood by while two innocent individuals anguished for 50 – 60 months and allowed them to be stripped of their career and full pension. The most recent frame up, using the same M.O., is that of Kenneth Pedeleose.

Pedeleose is a senior industrial engineer with the Defense Contract Management Agency (DCMAE) who objected to, and blew the whistle on the Lockheed C-5 parts scandal: $744.00 for washers, $714.00 for a rivet, $5,217 for a 1-inch metal bracket and $2,522 for a 4-inch metal sleeve. According to a Federal Times April 5, 2004 story, Pedeleose’s whistle blowing “resulted in government savings of $34 million according to the [Department of Defense] estimates.” Pedeleose’s exemplary government service also earned him a bull’s eye on his back by the DCMA’s Chief Counsel, Bruce Krasker, who orchestrated many retaliatory frame-ups, with the cooperation of the DOJ. In a June 28, 2006 sworn interview with the NSA, Trahan describes Pedeleose this way: “disruptive, disloyal and counterproductive.” Trahan’s false statements to this investigator suggest that he is at the front of Pedeleose’s retaliation. Trahan has repeatedly demonstrated that he is impervious to DoD rules and regulations and the law. Trahan and others in the DoDIG chain of command are a danger to the government, yet they remain in high paying jobs to facilitate criminal activity, which affects all Americans. In a conflict of interest, Trahan’s counterpart, the AIG for Policy and Oversight, James L. Pavlik, covered up for Trahan by conducting a fraudulent investigation, making false official statements and issuing a fraudulent report to deceive Senator Grassley. After he reviewed my 30-page affidavit, Pavlik writes: “We found that Mr. Kinan has repeatedly distorted the factual record by asserting only some of the relevant facts in order to convince others that he was wronged by the system.” Incidentally, the FBI and the DOJ have verified the criminal conduct outlined in my 30-page affidavit. My affidavit was concealed with a government payoff, which allows the crime to continue. 5

As for the DOJ’s thought on my reporting, AUSA Christine Wichers of the Boston United States Attorney’s office characterizes my lawful reporting of crime, public corruption and verified felony conduct as being “irrelevant, repetitive, conclusory, inflammatory, prolix, disjointed, unintelligible, impenetrable, swollen with irrelevant rhetorical flourishes, muddled, personal and vindictive.” Although they are remarkable and dramatic descriptions of the verified facts, that office has not denied or disputed the DCMA’s pattern and practice of crime and the irreparable harm to many innocent individuals and the government.

I respectfully, remind the Senator that anyone willing to frame innocent citizens will do or say anything, even cover up the Hasan massacre.

The Senator should know that the Defense Criminal Investigation Agency, the FBI and the DOJ have established my credibility at 100%.

Please view the verified facts in their proper context concerning these serious matters. I emphasize, this is about conduct only. My 30-page affidavit can be emailed to you immediately on request.

Please let me know of the Senator’s decision concerning my reasonable, lawful and relevant request.

Thank you.

Respectfully submitted,

/s/Douglas K. Kinan

617-323-6171

dougkinan@yahoo.com

Attachments (2)

cc:

President Barack Obama

Honorable Susan Collins (via fax: 202-224-2693 & 207-622-5884)

Honorable Charles Grassley (via fax: 202-224-6020)

Honorable Patrick Leahy (via fax: 202-224-3479)

Honorable Arlen Specter (via fax: 202-228-1229)

Honorable John Conyers (via fax: 202-225-0072)

Eric Holder, Attorney General (via fax: 202-514-4482 202 & 202-514-4001))

Robert Mueller, Director, FBI (via fax: 202-278-2478)

James “Chip” Burrus, FBI Integrity Committee (via fax: 202-324-4260)

Robert M. Gates, Secretary of Defense (via fax: 703-571-9339)

John McHugh, Secretary of the Army (via fax 703-697-3501)

Gordon Heddell, DoD Inspector General (via fax: 703-604-8310)

Lt. Gen. Robert Cone, Commanding

Jeffrey Trueman, VERPA

Marie Virella: Framed with the participation of Trahan, et al

Morris Plaisance: Framed with the participation of Trahan, et al

Kenneth Pedeleose: Framed with the participation of Trahan, et al

Carol Czarkowski: Framed with the participation of Trahan, et al 6

World Wide Web

FAA Whistleblower: “They don’t want you to be part of the solution; they want you to go away.”

“After 25 years at Dallas-Fort Worth Airport, an air-traffic controller who blew the whistle on Federal Aviation Administration misconduct is quitting.

Anne Whiteman started reporting problems 12 years ago at the airport – including an incident in which two planes came within 300 feet of each other – and has suffered continual harassment since, including physical assault, isolation, and even a death threat.

Twice her claims were substantiated by Office of Special Council investigations (OSC), but the harassment only increased to include claims of drug abuse, not showing up to work on time, and fraud. The OSC is the federal agency charged with protecting federal employee whistleblowers.

Whiteman even emailed new FAA director Randy Babbit in May of this year, shortly after his appointment. He did not respond.

Saying that the FAA finally won, Whiteman resigned last week. She had been offered a new position, only to have the opportunity withdrawn. Whiteman now believes that there is no accountability at FAA, and that “they don’t want you to be part of the solution; the want you to go away.”

The FAA responded in a statement that they are reaching out to whistleblowers.”

From GAP:  http://whistleblower.typepad.com/all_things_whistleblower_/2009/09/faa-whistleblower-they-dont-want-you-to-be-part-of-the-solution-they-want-you-to-go-away.html

Isn’t that the truth and in more agencies than just the notably corrupted FAA.  The Federal workplace is becoming littered with the abused, the damaged, the tired and disheartened “good people” whose only crime was wanting to do their jobs ethically and well, you know the job they were hired to do, the job they were trained to do, (at least in the old days when federal employees actually were allowed to get the training they needed to become good at their jobs). 

And in industry it is no better. 

I wish more people would speak up.  If we made a paper chain out of the resume’s of these people who’ve sacrificed their careers and more to try to do right, we’d cover the nation via I-90 by now.  I am thinking that what a retired investigator told me some time ago, that the only way to get change is to publicly humiliate the wrongdoers,  may be correct.  Any one who wishes to speak up is invited to do so here!  -GFS