The Financial Times has a great article about how the price of oil is determined.
However, after it became known the Libor interest rate was being manipulated by
the banks, now everyone is wondering if the same thing has been going on
with oil prices.
Apparently there is a a small organization called Platts (part of McGraw-Hill) which monitors bids
Gas prices here jumped 10 cents in one day last week. Of course it was the day I decided to
fill up the gas tank. Luckily I drive a very small car.
This once again made me wonder, "why are oil prices so high".
As I posted previously, I thought the oil prices were being rigged, and the government thought so also.
However, perhaps the oil traders were successful in their bid to stop disclosure of records...
Some of the world’s largest oil
traders including Vitol Group, Morgan Stanley and Royal Dutch
Shell Plc (RDSA) are asking a judge to stop the disclosure of millions
of records gathered by the top U.S. commodity regulator during
its nationwide investigation of the crude markets.
Which, of course, would allow them to cover their tracks, and start a different scheme to
manipulate the price of oil.
There is a very good article in FOREX NEWS questioning the rational of the increase in the
WTI click here for link
...
Fundamentally,
the case for continued bullish push for WTI Crude remains weak. Global
economic recovery may have improved, but production levels are far from
pre financial crisis levels. Even after taking inflation into account,
price should not be anywhere near the 100 USD per barrel level – where
Oil was at before the crisis. Furthermore, oil production levels in US
are hitting record highs after record highs, and current bout of
decreasing inventory may simply be a short-term reprieve, with inventory
expecting to build up strongly once again in 2014. - See more at:
http://www.forexnews.com/blog/2013/12/30/wti-crude-current-bull-run-may-last/#sthash.kA7WX1XO.dpuf
Fundamentally,
the case for continued bullish push for WTI Crude remains weak. Global
economic recovery may have improved, but production levels are far from
pre financial crisis levels. Even after taking inflation into account,
price should not be anywhere near the 100 USD per barrel level – where
Oil was at before the crisis. Furthermore, oil production levels in US
are hitting record highs after record highs, and current bout of
decreasing inventory may simply be a short-term reprieve, with inventory
expecting to build up strongly once again in 2014. - See more at:
http://www.forexnews.com/blog/2013/12/30/wti-crude-current-bull-run-may-last/#sthash.kA7WX1XO.dpuf
The MSC Monterey, which was named in 2007, experienced a crack in the main deck,
which then spread to the outer hull. The article says it was named in 2007, but built in
2008, so I don't really know how old it is, but it's not THAT old.
The vessel was built in Romania. It is now south of Newfoundland, and plans are
to make temporary repairs and go to Boston.
If I were a ship operator, would certainly start checking the steel integrity of any ship built in Romania.
click here for link to article at Maritime Matters
I doubt this will happen...but one can always ask.
(Reuters) - The
chairman of German shipping group Hapag-Lloyd HPLG.UL said rival
Hamburg-Sued should join merger talks between Hapag-Lloyd and Chile's
Vapores VAP.SN.
"The three of us
together would be stronger," Hamburger Abendblatt quoted Juergen Weber
as saying in an excerpt from an article to be published on Friday.
Hapag-Lloyd,
the world's No.5 container shipping company by capacity, earlier this
month said it was in talks to merge with smaller Chilean shipper
Compania Sud Americana de Vapores, adding that no agreement had yet been
reached.
Shipping groups have been struggling through the worst slump on record, with the weak global economy, oversupply of vessels and low freight rates highlighting the benefits of consolidation in the sector.
Hapag-Lloyd,
burdened by 2.35 billion euros ($3.2 billion) of net debt and a
nine-month net loss of 56 million euros, already held talks with
Hamburg-Sued last year, but the parties were unable to agree terms.
The deal would have created the world's No. 4 player behind Maersk Line, part of Danish conglomerate A.P. Moller-Maersk (MAERSKb.CO), Switzerland's Mediterranean Shipping Company and France's CMA CGM CMACG.UL.
Weber
told Hamburger Abendblatt that he hoped Hapag-Lloyd's talks with
Vapores would be a "warning and motivation" for Hamburg Sued's owner,
the Oetker family, to rekindle talks.
He
also said the owners of Hapag-Lloyd still aimed to float shares in the
German shipping company in an initial public offering, though that was
"hardly possible" before the end of 2014, among other because a new
chief executive is due to take the helm next year.
Officials for Hamburg-Sued were not immediately available for comment.
The
city of Hamburg holds 36.9 percent of Hapag-Lloyd, while Klaus Michael
Kuehne, who also controls Swiss logistics group Kuehne & Nagel (KNIN.VX), owns 28.2 percent. German travel group TUI AG (TUIGn.DE) owns a 22 percent stake.
(Reporting by Maria Sheahan; editing by Andrew Hay)
The FMC has fined K-Line and NYK. The press release says they violated 46 U.S.C. 41102 listed below.
My best guess is they were buying space from each other without having a space agreement on file at the FMC, and they were not charging each other as per the tariff.
I recall carriers doing this, thinking there was nothing wrong. It didn't use to be difficult to file these type of agreements (perhaps it is now). Not knowing, or caring, about U.S. law cost each of these carriers over 1 USD million a piece.
(a) Obtaining Transportation at Less Than Applicable Rates.—A
person may not knowingly and willfully, directly or indirectly, by
means of false billing, false classification, false weighing, false
report of weight, false measurement, or any other unjust or unfair
device or means, obtain or attempt to obtain ocean transportation for
property at less than the rates or charges that would otherwise apply.
(b) Operating Contrary to Agreement.—A person may not operate under an agreement required to be filed under section 40302 or 40305 of this title if—
(1) the agreement has not become effective under section 40304 of this title or has been rejected, disapproved, or canceled; or
(2) the operation is not in accordance
with the terms of the agreement or any modifications to the agreement
made by the Federal Maritime Commission.
(c) Practices in Handling Property.—A
common carrier, marine terminal operator, or ocean transportation
intermediary may not fail to establish, observe, and enforce just and
reasonable regulations and practices relating to or connected with
receiving, handling, storing, or delivering property.
And here's the press release from the FMC
December 23, 2013
NR 13-19
Contact: Karen V. Gregory, Secretary (202) 523-5725
The Federal Maritime Commission announced compromise agreements
reached with two common carriers operating pure car carriers (PCCs) and
roll on/roll off (RO/RO) vessels in U.S. inbound and outbound trades.
Under these separate agreements, Kawasaki Kisen Kaisha Ltd. (K Line),
paid $1,100,000 in civil penalties and Nippon Yusen Kaisha (NYK Line),
paid $1,225,000 in penalties. Both carriers are headquartered in Tokyo,
Japan, and operate diverse fleets trading in the U.S.-foreign trades and
globally.
The compromise agreements resolved allegations that K Line and NYK
Line violated provisions of the Shipping Act, including section 10(a) of
the Shipping Act, 46 U.S.C. § 41102(b), by acting in concert with other
ocean common carriers with respect to the shipment of automobiles and
other motorized vehicles by RO/RO or specialized car carrier vessels,
where such agreement(s) had not been filed with the Commission or become
effective under the Shipping Act. The compromise agreements also
addressed related activities and violations. Commission staff alleged
that these practices persisted over a period of several years and
involved numerous U.S. trade lanes, including from and/or to the Far
East, Europe, the Middle East and South America.
Chairman Mario Cordero stated: "These penalties underscore the
seriousness with which the Commission views the carriers’ obligation to
file with the Commission any agreement with other carriers affecting
working relationships in the U.S. trades, both for import and export
traffic. The shipping public has a right to know the subject matter and
scope of any such agreement, and the Commission is charged by Congress
to oversee the parties’ operations and conduct under such agreements.
Investigations by our Bureau of Enforcement as to additional carriers
implicated in similar agreement activities are continuing at this time."
In concluding the compromise agreements, K Line and NYK Line agreed
to provide ongoing cooperation with other Commission investigations or
enforcement actions with respect to these types of activities. The
carriers did not admit to violations of the Act or the Commission’s
regulations. Staff attorneys with the Commission’s Bureau of
Enforcement negotiated the compromise agreements. The Federal Maritime Commission (FMC) is the independent federal
agency responsible for regulating the nation’s international ocean
transportation for the benefit of exporters, importers, and the American
consumer. The FMC’s mission is to foster a fair, efficient, and
reliable international ocean transportation system while protecting the
public from unfair and deceptive practices.
DA Dan Donovan announces the takedown of an insurance fraud ring involving medical professionals and longshoreman
December 18, 2013
STATEN ISLAND, NY – Richmond County
District Attorney Daniel M. Donovan, Jr., New York City Police
Commissioner
Raymond W. Kelly, Commissioner Ronald Goldstock of the Waterfront
Commission of New York Harbor, Special Agent in
Charge Brian Crowell of the U.S. Drug Enforcement Administration’s New
York Division (DEA), Chairman Robert Beloten of the
New York State Workers’ Compensation Board and Superintendent Benjamin
M. Lawsky of the New York State Department of
Financial Services announced today the arrests and indictments of nine
individuals after a 20-month investigation into insurance
fraud, the fraudulent dispensing of prescriptions for controlled
substances, sale and possession of oxycodone and gambling.
Targets of the investigation, dubbed
“Operation Shore Thing,” include MIHIR BHATT, a pain management doctor;
THOMAS E.
DINARDO, a chiropractor; STEVEN ALCARAS, NICHOLAS TORNABENE, ROSARIO
SAVASTANO and CHRISTOPHER
GALASSO, all longshoreman; CHARLES TORNABENE, a laborer, and RITA PATEL,
a pharmacist. The investigation also
yielded the arrest and indictment of longshoreman JOSEPH FAVUZZA, a
known associate of the Colombo crime family who was
running an organized gambling operation which involved an Internet
gambling site.
“My father worked as a longshoreman, so I grew
up knowing the dangers of the job. I can’t imagine how those risks are
multiplied
when people show up to work high on narcotics. But that is exactly what
happened here, longshoremen abusing painkillers
prescribed to them by a pill peddling doctor and a crooked chiropractor
who conspired to rip off millions from insurance companies
in a complex fraud scam. The number of oxycodone pills prescribed by the
doctor in this case is a staggering 1,775,703 over four
years, enough to cover 7 miles if you placed pill in front of pill. That
distance would stretch from Howland Hook to the foot of my
office,” said Richmond County District Attorney Daniel M. Donovan, Jr.
“This case is a clear example of why we need a national
drug database in this country, so that we can track the pill activity in
other states and know when our borough is being inundated
with over-prescribed painkillers. The one sure result of Operation Shore
Thing is that dangerous amounts of oxycodone are no
longer illegally flowing through Staten Island. I also want to note that
I have the highest regard for the workers who are proud to
call themselves longshoremen, and the defendants in this case are an
exception to that noble profession.”
NYPD Commissioner Raymond W. Kelly said, “This
case is another example of criminals perpetuating and exploiting
addiction, at
great risk to the public’s safety. It is especially despicable when
licensed medical practitioners put profit over others’ welfare. I
commend the members of the NYPD’s Organized Crime Investigations
Division for their work in bringing the principals of this
prescription drug and insurance fraud ring to justice.”
Commissioner Ronald Goldstock of The
Waterfront Commission of New York Harbor stated, “The Port is a
dangerous place in
which to work; those who we register deserve to be protected from
co-workers who make decisions and operate machinery under
the influence of narcotics and opioids. We will continue to use our
investigative, administrative and drug testing authority to
remove drug dealers and users from the docks. These arrests and our
administrative revocations make even more disturbing the
New York Shipping Association and I.L.A.’s unsuccessful attempts to curb
the Commission’s enforcement actions regarding drug
testing in the Port.”
DEA Special Agent in Charge Brian R. Crowell
said, “We allege Dr. Bhatt was a pain pill trafficker who wrote over
11,692
prescriptions for Oxycodone products over a two year period, and through
his illegal activities, Dr. Bhatt netted illicit proceeds in
excess of $12 million at the expense of the pain pill and heroin
epidemic our communities face. More than 52 million Americans
have abused prescription drugs at least once in their life. Visits by
individuals to hospital emergency rooms involving the misuse or
abuse of pharmaceutical drugs have doubled over the past five years and
law enforcement remains vigilant in bringing to justice
those drug traffickers responsible for fueling prescription drug abuse
with no regard to public health. I commend the men and
women from the NYPD, the Waterfront Commission of New York Harbor and
the TDS-NY for their diligent investigation.”
Chairman Robert Beloten of NYS Workers’
Compensation Board stated, “The Workers’ Compensation Board protects
injured
workers against doctors who overprescribe, who don’t provide the
treatment they’re billing for, and who keep their patients in the
system not for health care but to line their own pockets. People hurt at
work deserve the best health care possible, so we’ll continue
fighting health care fraud at all levels with all law enforcement
agencies to ensure the integrity of the system.”
Benjamin M. Lawsky, Superintendent of the
Financial Services, said: “As alleged, this criminal network reaped
millions of dollars
in illicit profits by trafficking in illegal drugs and engaging in
insurance fraud and kickbacks. These arrests help put the brakes on
that scheme. The Department of Financial Services thanks District
Attorney Daniel M. Donovan, Jr. and all the law enforcement
agencies which worked on this investigation.”
“Operation Shore Thing” commenced in March
2012 and included the use of confidential sources, undercover police
officers,
electronic surveillance and physical surveillance. The scam was
perpetrated by defendant BHATT, who engaged in stealing from
insurance companies and fraudulently dispensing narcotic drugs under the
guise of a pain management enterprise.
Patients paid for the alleged pain management
services by using their insurance and received prescriptions for
oxycodone based
upon perfunctory or nonexistent treatment rendered by BHATT at the NYC
Wellness Center at 4870 Hylan Blvd., Staten Island,
New York, which is owned and operated by DINARDO, and other locations.
BHATT billed insurance companies using his own
name and through his business, BMB Medical P.C.
DINARDO would bring patients into his offices,
the NYC Wellness Center, and then he and BHATT would direct them to
make
return office visits, receive chiropractic treatment, magnetic resonance
images, nerve conduction tests, and electromyography
(“EMGs”), to support a long term insurance billing scheme and the
dispensing of oxycodone prescriptions.
These exams, if done at all, were not
conducted properly, and were conducted to give the appearance of an
examination to justify
further billable office visits, dispensing prescriptions for oxycodone,
and lengthy workers compensation claims. Participating
patients would call to get prescriptions for oxycodone and would receive
them in return for billable office visits that did not occur,
or which were perfunctory and lasted only an average 3-5 minutes.
Insurance companies would then be billed for procedures that
took 25, 40, or 60 minutes.
BHATT and DINARDO decided which patients were
too risky to see because of possible law enforcement surveillance and
instructed members of the enterprise on how to avoid detection by law
enforcement. DINARDO employed a lookout to surveil
possible law enforcement activities in the vicinity of the NYC Wellness
Center. He also flagged patients who presented a risk of
exposing his criminal/fraudulent activities due to their age, reputation
for talking too much, and likelihood of getting caught in
illegal pill related activities. BHATT paid DINARDO monetary
compensation, under the guise of rent, for providing the location
and patients for the fraud.
BHATT also dispensed prescriptions from his
Lyle Place home in Edison, New Jersey, which was not a medical office,
while
indicating in insurance claims that the prescriptions were generated
from office visits occurring in Staten Island. In addition to
utilizing NYC Wellness Center, BHATT also perpetrated his fraudulent
activities at medical offices located at 456 Arlene St. and
3733 Richmond Avenue in Staten Island, New York, and a location in
Queens.
As part of the conspiracy, BHATT billed
Connecticut General Life Insurance (“Cigna”) and Empire Blue Cross Blue
Shield for
services that he did not provide. BHATT also issued prescriptions to
ALCARAS, GALASSO, SAVASTANO, NICHOLAS
TORNABENE and CHARLES TORNABENE that were paid for, in part, with CVS
Caremark insurance.
BHATT would direct patients to use PATEL,
of the Shayona Pharmacy at 147 Smith St. in Perth Amboy, New Jersey, to
fill their
prescriptions. PATEL, in turn, directed BHATT to issue oxycodone
prescriptions to patients based upon their insurance coverage
so as to maximize the profit of the conspiracy. PATEL also instructed
BHATT how to prescribe oxycodone to avoid detection by
law enforcement. Further, PATEL would charge BHATT’s patients more than
their insurance copayment to fill their oxycodone
prescriptions, yielding herself an ill-gained profit.
ALCARAS, a longshoreman, managed
appointments and the picking up of prescriptions of oxycodone, for the
other, separately
indicted longshoremen, who received prescriptions for oxycodone without
exams by BHATT or after perfunctory visits to his offices. ALCARAS
communicated with both BHATT and DINARDO about the suitability for
inclusion or exclusion of individual
longshoreman as patients. ALCARAS also communicated with BHATT and
DINARDO when longshoreman were needed at one
of BHATT’s offices for fraudulent exams to justify further fraudulent
billing of insurance companies, or to receive fraudulent
doctor’s notes to avoid losing their registration as longshoreman.
From on or about and between Feb. 26, 2013,
and April 26, 2013, GALASSO filed false instruments with the Waterfront
Commission in order to avoid decasualization, which is the process of
removing longshoremen from the register based on failure to
meet the work requirements. Specifically, ALCARAS and GALASSO requested
doctor’s notes from BHATT and DINARDO for
medical treatment of GALASSO that did not occur, and instructed them on
how the notes should be written.
In addition to participating in the
insurance fraud, some of the longshoreman also evaded drug tests at
work, learning about them
beforehand and using devices like prosthetics, cleansing drinks and
synthetic urine to try and pass the test. The investigation also
uncovered that several of the longshoreman also went to work under the
influence of narcotics. NICHOLAS TORNABENE also
engaged in selling drugs.
Recovered during the execution of search
warrants were $3 million in assets, as well as 12 pounds of gold and a
quantity of
oxycodone.
This case is being prosecuted by Assistant District Attorney Gabriel McKeen of the Richmond Country District Attorney’s Office,
under the supervision of Assistant District Attorney Amy Legow, Chief of the Investigations Bureau. Also assisting in the
prosecution is Assistant District Attorney David Frey, Deputy Chief of the Investigations Bureau.
Participating agencies and investigators were:
• Detective Jeffrey Quod and members of the New York Police Department’s Organized Crime Investigation Division,
Major Investigations Section team, acting under the supervision of Captain John Dusanenko and Lieutenant Jack Iacovou.
• Detective Ralph Grasso and members of Waterfront Commission New York Harbor Brooklyn Field Office, acting under
the supervision of Capt. Jeffrey Heinssen. Also, attorney Jeffrey Kwastel of the Waterfront Commission, who was sworn
in as a special ADA to assist in the investigation and indictment.
• Detective Lisa Paskewitz and members of the NYPD Asset Forfeiture Unit and the El Dorado Task Force from
Immigrations and Customs Enforcement, acting under the supervision of Sgt. Gary Galitsky and Lieutenant Charles
Scalzo. Detective Paskewitz also worked on the Asset Forfeiture Task Force for Homeland Security, acting under the
supervision of Shawn Polonet, group supervisor for the Asset Forfeiture Unit, Homeland Security Investigations, New
York.
• The DEA’s Tactical Diversion Squad which is comprised of agents and officers from the DEA, NYPD, Town of
Orangetown, Westchester County Police Department, acting under the direction of DEA Supervisory Special Agent
Special Agent in Charge Brian R. Crowell.
• Inspector General Paul D’Emilia of the New York State Workers’ Compensation Board. Part of the case was also handled
by Pamela Davis and David Regazzi, Office of the Fraud Inspector General, New York State Workers’ Compensation
Board.
• Senior Investigator Ed Miller and Deputy Chief Investigators Joe Edwards and Anthony Gonzalez of the New York State
Department of Financial Services, under the overall supervision of Frauds Bureau Deputy Director Angelo Carbone,
Director Frank Orlando and Executive Deputy Superintendent Joy Feigenbaum.
• Brendan Vallely from the Bureau of Narcotics Enforcement, New York State Department of Health
Also, special thanks to AIG and Emblem
Health insurance companies for their cooperation, as well as Cigna,
Empire Blue Cross
Blue Shield, Aetna and CVS Caremark.
And, credit is to be given to the Middlesex County Prosecutor’s Office for assisting in the investigation.
The charges contained in the indictments
are merely allegations, and the defendants are presumed innocent until
proven guilty. The
defendants are facing various felony counts including enterprise
corruption, scheme to defraud, grand larceny, insurance fraud,
filing false business records and conspiracy. FAVUZZA is facing several
gambling charges.
Mihir Bhatt, 47
Medical Doctor
03/07/1966
22 Lyle Place, Edison, NJ
Arrested 12/17/13 in New Jersey, awaiting extradition
If convicted of the top charge, enterprise corruption, he faces a maximum of 25 years in prison.
Thomas E. Dinardo, 44
Chiropractor
06/16/1969
3755 Amboy Road, SI NY
Arrested and arraigned 12/17/13
Bail set at $90,000
If convicted of the top charge, enterprise corruption, he faces a maximum of 25 years in prison.
Steven John Alcaras, 42
Longshoreman, assigned to the Brooklyn Cruise Terminal
06/24/1971
759 Katan Ave., SI NY
Arrested and arraigned 12/17/13
Bail set at $77,500
If convicted of the top charge, enterprise corruption, he faces a maximum of 25 years in prison.
Nicholas Tornabene, 28
Longshoreman, assigned to the New York Container Terminal at Howland
Hook
08/01/1985
8217 16th Ave., Brooklyn NY
Arrested and arraigned 12/17/13
Bail set at $25,000
If convicted of the top charge, criminal sale of a controlled substance
in the 3rd degree, he faces a maximum of 9 years in prison.
Charles Tornabene, 28
Laborer
08/01/1985
8217 16th Ave., Brooklyn NY
Arrested and arraigned 12/17/13
Bail set at $15,000
If convicted of the top charge, insurance fraud, he faces a maximum of 7 years in prison.
Rosario Savastano, 28
Longshoreman, assigned to the Brooklyn Cruise Terminal
02/27/1985
1777 West 12th St, Brooklyn NY
Arrested and arraigned 12/17/13
Bail set at $15,000
If convicted of the top charge, insurance fraud, he faces a maximum of 7 years in prison.
Christopher Galasso, 29
Longshoreman, assigned to the Brooklyn Cruise Terminal
06/07/1984
456 Fanning St., SI NY
Arrested and arraigned 12/17/13
Bail set at $15,000
If convicted of the top charge, insurance fraud, he faces a maximum of 7 years in prison.
Joseph Favuzza, 29
Longshoreman, assigned to the New York Container Terminal at Howland Hook (suspended since 2012 on separate cases)
10/23/1984
92 Fahy Ave., SI NY
Arrested and arraigned 12/17/13
Bail set at $5,000
If convicted of the top charge, promoting gambling, he faces a maximum of 4 years in prison.
Rita Patel, 48
Pharmacist
06/20/1965
4 Hauser Lane, Matawan NJ
Arrested 12/17/13 in New Jersey, awaiting extradition
If convicted of the top charge, criminal sale of a prescription for a
controlled substance, she faces a maximum of 15 years in prison.
--------------------------------
Counterfeit goods have been available in Chinatown in NYC for a long time. Even John Stewart makes jokes about it on his show. Of course, someone must import these goods.
The FBI has made arrests in one operation of counterfeit imports, plus money laundering.
This is from the FBI web-site. The FBI is really busy, and reading their press releases is
quite an eye opener.
Nine Admit Guilt in Largest Counterfeit Goods Conspiracy Ever Charged
U.S. Attorney’s Office
December 13, 2013
NEWARK, NJ—Nine members of a massive, international counterfeit goods
conspiracy have admitted their roles in the scheme, U.S. Attorney Paul
J. Fishman announced.
Hai Dong Jiang, 37, and Fei Ruo Huang, 37, both of Staten Island, New
York; Hai Yan Jiang, 34, of Richardson, Texas; Xiance Zhou, 39, and
Jian Chun Qu, 33, both of Bayside, New York; and Ming Zheng, 48, of New
York, pleaded guilty today before U.S. District Judge Esther Salas in
Newark federal court. Dong Jiang, Ruo Huang, and Yan Jiang pleaded
guilty to informations charging them each with one count of conspiracy
to traffic in counterfeit goods. Xiance Zhou and Qu pleaded guilty to
informations charging them each with one count of conspiracy to
structure money. Zheng pleaded guilty to an information charging him
with a conspiracy to launder money.
Wei Qiang Zhou, 38, of Brooklyn, New York, pleaded guilty December 3,
2013; Patrick Siu, 41, of Richardson, Texas, pleaded guilty December 4,
2013; and Da Yi Huang, 43, of Staten Island, pleaded guilty December
11, 2013, all before Judge Salas in Newark federal court, to
informations charging them each with one count of conspiracy to traffic
in counterfeit goods.
According to documents filed in this case and statements made in court:
From November 2009 through February 2012, the defendants ran one of
the largest counterfeit goods smuggling and distribution conspiracies
ever charged by the Department of Justice. The defendants and others
conspired to import hundreds of containers of counterfeit
goods—primarily handbags, footwear, and perfume—from China into the
United States in furtherance of the conspiracy. These goods, if
legitimate, would have had a retail value of more than $300 million.
The counterfeit goods were manufactured in China and smuggled into
the United States through containers fraudulently associated with
legitimate importers, with false and fraudulent shipping paperwork
playing a critical role in the smuggling scheme. Some of the
conspirators created and managed the flow of false shipping paperwork
between China and the United States and supervised the importation of
counterfeit goods, and others controlled the importation of the
counterfeit goods into the United States.
Other conspirators managed the distribution of counterfeit goods once
those goods arrived in the United States. After importation, the
counterfeit goods were delivered to warehouses and distributed
throughout New York, New Jersey, and elsewhere. Certain conspirators
paid large amounts of cash to undercover law enforcement officers to
assist in the removal of counterfeit goods from the port.
Some conspirators acted as wholesalers for the counterfeit goods,
supplying retailers who sold counterfeit goods to customers in the
United States. Other conspirators were money structurers who arranged
for cash to be wired to China in amounts small enough to avoid
applicable financial reporting requirements to evade detection of the
smuggling scheme and related proceeds.
Law enforcement introduced several undercover special agents
(collectively, the UCs) to the conspirators. The UCs purported to have
unspecified “connections” at the port, which allowed the UCs to release
containers that were on hold and pass them through to the conspirators.
The conspirators paid the UCs for these “services.” In total, during the
course of this investigation, the conspirators provided the UCs more
than $2 million.
UCs recorded dozens of phone calls and in-person meetings with
various conspirators. The investigation also utilized several
court-authorized wiretaps of telephones and electronic communications.
China Raises Ship-Scrapping Subsidy 50% to Trim Overcapacity
By Jasmine WangDec 10, 2013 3:35 AM ET
Photographer: Qilai Shen/Bloomberg
Shipyard workers sweep the ground at an assembly area at the Dalian shipyard in Dalian,... Read More
China, the world’s biggest
shipbuilding nation, will increase cash subsidies for scrapping
obsolete ships by 50 percent to help cut overcapacity and
emissions.
The government will grant 1,500 yuan ($247) per gross ton
for shipping companies to replace obsolete ships, according to a
statement on the transport ministry website yesterday. The award
applies to vessels scrapped in the years 2013 through 2015.
Chinese shipbuilders also stand to benefit from the
subsidy, half of which is awarded only after replacement orders
are placed. China Rongsheng Heavy Industries Group Holdings (1101), the
nation’s biggest shipyard outside state control, rose 8.9
percent to close at HK$1.22 in Hong Kong. China Shipping
Development Co. (1138), a Shanghai-based commodities shipping company,
gained 0.9 percent to HK$5.35. The city’s benchmark Hang Seng
Index fell 0.3 percent today.
“The program will be positive for the shipbuilding sector
in the long term,” said Lawrence Li, a Shanghai-based analyst
at UOB Kay-Hian Holdings Ltd. “In the near term, it may not be
material for the shipping industry, as the incentive is not
attractive enough and many cash-strapped shipping firms may not
be able to place new orders amid a bad market.”
New Orders
Under the new program, ship operators get half the money
upon completing scrapping and the rest after placing new
building orders, according to the statement. By comparison,
under a 2010 rule, they had to complete scrapping and place new
ship orders before getting any of the subsidy.
The program is “somewhat disappointing” as it didn’t
lower the age requirement for ships that can be scrapped, which
means less tonnage is eligible, according to a note published
today by Credit Suisse Group AG analysts led by Davin Wu.
The Baltic Dry Index (BDIY), the benchmark for commodity-moving
rates, has slumped 41 percent in the past four years. The
monthly index that tracks prices for all types of vessels
dropped 31 percent in November from its peak in September 2008,
when the global financial crisis caused orders to slump,
according to Clarkson Plc, the world’s biggest shipbroker.
To contact the reporter on this story:
Jasmine Wang in Hong Kong at
jwang513@bloomberg.net
To contact the editor responsible for this story:
Vipin V. Nair at
vnair12@bloomberg.net
As has been reported in the last week, Hapag-Lloyd and CSAV are holding talks. Initial reports
said they were planning a merger, but as per Bloomberg News, the talks appear to center more
on a "possible business combination". It's very difficult for two companies to come together, which is
why Hapag-Lloyd and Hamburg Sud did not come to terms during their merger talks.
However, as each company bleeds money, there will be more incentive to come to an agreement.
Not sure of the official forecasts, but my guess is this industry still has a few more bad years before a major turn around. Actually, it could be even worse than that, as the shipyards in China haven't closed down, and those ships have to go somewhere!
Hapag-Lloyd Talks to CSAV About Tie-Up to Fight Industry Slump
By Nicholas BrautlechtDec 5, 2013 2:08 AM ET
Hapag-Lloyd AG is discussing a
possible merger with Cia. Sud Americana de Vapores SA, Latin
America’s biggest container shipping line, as the companies
struggle to overcome a global trade slump that has left the
industry in crisis.
The talks are focused on whether “a possible business
combination or any other form of association would be of mutual
interest,” Hamburg-based Hapag-Lloyd said in a statement today.
Hapag-Lloyd, the biggest German container line with a fleet
of 152 vessels, is still reeling from the slump triggered by the
2008 collapse of Lehman Brothers Holdings Inc., reporting a 64
percent decline in profit for the third quarter, its peak
season. It’s turning its sights to CSAV after talks to merge
with local competitor Hamburg Sued, owned by family-owned German
holding company Oetker-Group, failed in March because
shareholders of both companies couldn’t agree on terms.
The talks with Valparaiso, Chile-based CSAV “have not
resulted in any binding or non-binding agreement between the
parties,” Hapag-Lloyd said in the statement, without
elaborating further.
CSAV surged 13 percent, the most in more than a year, after
Die Welt newspaper reported last night that the Latin American
container shipper is negotiating a merger with its German rival.
CSAV’s 86 percent loss in the past three years is the worst
performance among peers tracked by Bloomberg. In response to a
glut of new vessels, operators such as A.P. Moeller-Maersk A/S
are forming alliances with competitors to lower costs and
eliminate excess capacity on trade routes.
Billionaire Luksics
The billionaire Luksic family controls CSAV with a 46
percent stake. The Luksic’s holding company Quinenco SA (QUINENC) has put
more than $1 billion into CSAV in the past two years after the
company lost a record $1.25 billion in 2011.
Top executives of Hapag-Lloyd and CSAV last month met in
Miami to discuss a possible merger, Die Welt reported on its
website, without saying where it got the information.
Hapag-Lloyd is owned by a group of shareholders including
German tourism company TUI AG (TUI1), HSH Nordbank AG and the city of
Hamburg. TUI, which holds a 22 percent stake, has endorsed an
initial public offering of the shipping company. CEO Friedrich Joussen on Nov. 7 said that he doesn’t expect an exit through an
IPO before Hapag-Lloyd’s Rolf Habben-Jansen replaces current CEO
Michael Behrendt next July.
Hapag-Lloyd formed an alliance in Asia-Europe trade, called
G6, in March 2012. The other partners are APL, Hyundai Merchant (011200)
Marine, Mitsui O.S.K. Lines (9104), Nippon Yusen (9101) Kaisha and Orient
Overseas Container Line.
To contact the reporter on this story:
Nicholas Brautlecht in Hamburg at
nbrautlecht@bloomberg.net
To contact the editor responsible for this story:
Angela Cullen at
acullen8@bloomberg.net
Finally, after 60 years the Waterfront Commission is doing their job. It's a bit difficult for the ILA
officials to understand that just because they say something, does not make it true.
Witness this statement (as reported by the Waterfront Commission)
In today’s statement attacking the Commission’s efforts, NYSA President
John Nardi staggeringly asserted that the ILA is “already a diverse
workforce.” This is directly contradicted by the demographics of the
only two ILA locals that have joined in the lawsuit, Local 1804-1 and
Local 1814, whose registrants are less than 2% and 8% African American,
respectively. It is for this very reason that the New York State
Division of Human Rights has filed charges against the NYSA, MMMCA, ILA,
and ILA locals alleging discriminatory hiring.
Seriously John? The ILA is a diverse workforce? I guess you don't know how to read demographic statistics. I highlighted to word "staggeringly", which I am sure was not the first choice of words which came to mind after reading this statement.
Anyway, here is the link to the full report, and the full report
WCNYH Statement of the Waterfront Commission of New York Harbor in Response to Press Release by NYSA and ILA Regarding Lawsuit Filed
November 22, 2013
Today, the New York Shipping Association,
Inc. (NYSA) and International Longshoremen’s Association, AFL-CIO (ILA)
announced the filing of their complaint against the Waterfront
Commission of New York Harbor. That complaint, which alleges
interference in their collective bargaining process, is actually
designed to prevent the Commission from fulfilling its mandate to ensure
the fair hiring of a diverse workforce in the Port.
Those allegations of improper interference
with the collective bargaining process are categorically untrue. Over
the past sixty years, courts have consistently upheld the Commission’s
actions when a collective bargaining agreement has violated the letter
and spirit of the Waterfront Commission Act.
As shown by public hearings, current
provisions in the collective bargaining agreements of the ILA, NYSA and
Metropolitan Marine Maintenance Contractors Association (MMMCA) have
perpetuated disparate hiring practices, resulting in an incredible lack
of diversity in waterfront employment, as well as an income gap among
those minorities that are employed there. Indeed, the hiring, training
and promotion practices of the industry have led to no/low-work,
no/low-show positions generally characterized by outsized salaries
provided to a privileged class. Those with such positions are
overwhelmingly given to white males connected to organized crime figures
or union leadership.
In today’s statement attacking the
Commission’s efforts, NYSA President John Nardi staggeringly asserted
that the ILA is “already a diverse workforce.” This is directly
contradicted by the demographics of the only two ILA locals that have
joined in the lawsuit, Local 1804-1 and Local 1814, whose registrants
are less than 2% and 8% African American, respectively. It is for this
very reason that the New York State Division of Human Rights has filed
charges against the NYSA, MMMCA, ILA, and ILA locals alleging
discriminatory hiring.
To combat such practices, the
Commission has asked that the industry implement a hiring plan that will
result in individuals being hired in a fair and non-discriminatory
basis in accordance with state and federal laws - - as is required of
all other employers. In response, the NYSA and ILA issued a press
release expressing frustration with the Commission’s “bureaucratic
delays,” claiming labor shortages have had a resultant negative economic
impact on cargo flow. During subsequent discussions with The Port
Authority of New York and New Jersey, the NYSA was forced to retract
that statement and publicly agreed that the Commission was, and is not,
delaying hiring, and that applicants were actively processed.
Indeed, the Commission has expeditiously
processed each and every applicant referred, in order to put people to
work in the Port as quickly as possible. Many NYSA and ILA referrals
have been prequalified and are now ready for employment. The Commission
has also offered a diverse prequalified pool of labor assembled from
government employment centers in New York and New Jersey, to alleviate
any immediate labor shortages. Those individuals, once described by ILA
President Harold Daggett as “garbage,” were summarily rejected, with
the NYSA claiming that their employment was prohibited by the provision
of the collective bargaining agreement at issue.
In today’s press release, the NYSA and ILA
indicated that the Commission has obstructed their efforts to achieve
productivity and growth. Over the past several weeks, terminal
operators have indicated that there is a growing need for immediate
labor. As of today, there are 136 individuals – many of whom are
military veterans – prequalified to be put to work in the Port. To
date, the industry has simply chosen not to do so. Instead, they have
responded with a baseless lawsuit.
The NYSA’s last meritless attempt to
challenge the Commission’s authority was summarily dismissed by the
federal court, and its appeal was likewise denied. That litigation
needlessly depleted its members’ resources. Today the NYSA has
definitively demonstrated that it no longer represents the interests of
its terminal operator members but, rather, that of the ILA. This
attempt to institutionalize discrimination through collective bargaining
agreements will not be tolerated. The Waterfront Commission of New
York Harbor will vigorously and successfully defend this lawsuit.
