10 Most Outrageous Insurance Frauds

In the movies they are played by Pierce Brosnan and Gene Hackman and justify art stealing or snatching of old Nazi German gold. In real life however they are unattractive and miserable figures devoted to the unglamorous and unforgiving life of insurance frauds. They do not have punch lines or happy endings, but their actions speak of great intelligence and/or tremendous stupidity. Here are 10 rascals that are the masterminds behind the most outrageous insurance frauds our time has ever seen. You decide who is who.

10. Tramesha Lashon Fox – Gave A for Arson

Tired of paying the bills on her car, high school chemistry teacher Tramesha Lashon Fox offered two of her underachieving students the grade A if they would “steal” her car and set it on fire. Naturally the two students took the offer but must have screwed something up. Fox not only lost her car, but also her job and freedom in the process.

9. Dr. Andrew Cubria – 750 unnecessary operations later

He may not have won an award for one of the largest fraudsters, but he was one of the cruelest. This cardiologist made a living by performing invasive, painful, and dangerous heart surgery on perfectly healthy people. He paid recruiters to visit homeless shelters and public housing to find indigents, seniors, and drug addicts. These vulnerable people were paid cash to show up at his clinic to submit to a battery to tests, and finally, invasive heart procedures.

In fact, he performed 750 operations on healthy people, and 2 of his “patients” died. He worked at Chicago’s Edgewater Medical Center, and federal prosecutors did not believe he worked alone. All of these illegal, unnecessary, and dangerous procedures were performed to defraud health insurance companies and public health services of millions of dollars.

8. Charles Gavett - The 9/11 Scheme

Charles Gavett did not get famous for the size of his insurance fraud, but for his audacity and bad taste. While most of the US grieved for the dead, Gavett claimed that his wife, Cindy, died in the World Trade Center attacks on September 11, 2001. However, she was really alive and safe in their home. They lived in a fairly small community, and their plans to collect $200,000 from their mortgage life insurance policy were thwarted when neighbors reported they had seen her in town since the attacks.

7. Curtis Donald Keene – Burried his cotton picker

This Georgian farmer managed to bury his cottom picker, a monster of eight ton, in an attempt to claim some insurance money.

6. Sex, greed and $200 million

Martin Frankel’s story contains of sex, greed, and a $200 million dollar fraud. Considering this and then how Frankel looks, we just had to include him on this list. He was fired from one of his first jobs, in the 1980’s, for misrepresenting himself in electronic trades, but by that time he had managed to impress the brokerage owner’s friends, and he had even taken the brokerage owner’s wife as a mistress.

One of these friends staked Frankel with their own savings and Frankel continued to suck investors into his schemes. By the end of this career as an insurance fraud, Frankel had about $205 million and two loyal mistresses to show for it.

5. John Stonehouse – the master of cheesy staged suicides

The british Labour politician with teeth hygiene like no other, John Stonehouse did what any man with debts and a whining wife would do. He staged his suicide and fled to Australia to start a new life with his mistress. The suicide was especially dramatic as he left nothing but his clothes on a beach to make it seem like drowning. Stonehouse was later arrested and convicted of insurance fraud.

4. Carla Patterson – The dead mouse in soup incident

Cracker Barrel once received a complaint from a customer named Carla Patterson. She had found a dead mouse in her soup, thus accusing the restaurant company of violating obvious health regulations. In it for her was $500,000 in insurance money from the restaurant. But when the mouse turned out not to have any soup in its lungs and had not been boiled, Patterson abandoned her claims and received one year in prison.

3. Ronald Evano – The glass eater

Boston resident Ronald Evano actually ate glass to convince his insurance company to pay up. Evano stated that he found the glass in the food and beverage he was eating. The insurance company did not fall for it and sent Evano packing for a 62 month jail sentence. Next time maybe he should try a simpler con.

2. John Darwin - “I think I’m a missing person”

In 2000, John Darwin went missing during a canoeing trip. Assumed deceased by the police Darwin’s life insurance was collected by his wife and life went on to see another day. Five years later a man showed up at a London police station claiming he had amnesia and under the belief of being a filed missing person. As it turned out this man was no other than John Darwin, who after half a decade hiding in Panama could no longer fight his longing for good ‘ol England.

Darwin had thus faked his own death, together with the misses, so that she could collect John’s quite wealthy life insurance. They had not told anybody, not even their children who genuinely thought their father was dead. A well planned life insurance scheme, unveiled only by a photo of the couple in Panama after Darwin’s disappearance.

1. Antoinette Millard – The Saudi Princess from Manhattan

No doubt suffering from poor psychological health, Manhattan girl and investment banker Lisa Walker one day decided to take on the fake and fictive identity of Antoinette Millard – a Saudi princess who had converted to Judaism. In addition to intense mingling with the New York social elite, Millard also tried to convince here insurance company that she had been mugged on jewelry worth $262,000. Princess Millard became such a social phenomenon in New York that even magazine New York Social Diary mentioned the princess.

When the insurance company finally filed the princess’ insurance claim as fraud, Millard confessed her elaborate scheme, blaming it on anything from 9/11 to her rough childhood.

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You Want to Tax What? Government Gets Desperate

By ALICE GOMSTYN
ABC NEWS Business Unit

In Chicago, surveillance cameras may someday help the city to fine more uninsured drivers. In Ohio, a city court is limiting its new cases because it can't afford more printer paper. In California, there's a loud call to tax marijuana sales. And in Georgia, one lawmaker says he's not giving up on his proposal for a state strip club surcharge.

Government officials desperate for cash are turning to all sorts of unusual efforts to make and save money.

(ABC News Photo Illustration)

Across the country, these and other unusual money-saving and money-making efforts have been volleyed by government officials desperate for funding.

"A new wave of creativity is sweeping across budget offices these days," said Pat Hagan, national audit partner for state and local governments at Deloitte and Touche LLP.

Because the recession has cut so sharply into property tax, sales tax and income tax revenues, Hagan said, state and local officials are looking for nontraditional sources of cash.

"There are funny stories, although they're quite serious topics," he said.

Among the efforts drawing the most attention are so-called "sin taxes" -- taxes on products or services that many associate with vices like alcohol, smoking, pornography, strip club visits and in Nevada's case, prostitution.

Some sin taxes, though, Hagan said, aren't as effective as proponents may hope because they target only a limited number of people -- those who smoke or visit strip clubs.

Certain efforts to cut government spending, likewise, may result in only limited savings.

But, Hagan added, "Sometimes people want to do this in their communities because it sends the right signal that these are tough times, and you don't want your government to be spending frivolously."

Following is a look at unusual efforts -- both large and small -- to help governments boost their bottom lines.

Strip and Save?

It's been dubbed the "pole tax," but Georgia State Sen. Jack Murphy insisted his money-making proposal is really a surcharge, not a tax.

The Republican lawmaker is asking the state government to charge a $5 fee per visit to patrons of strip clubs. The revenue from the surcharge, he said, would go to fund new rehabilitation centers for teenage prostitutes.

"This bill is strictly to try to get some of these 13-, 14-year-olds off the street to give them a place to go, give them some therapy," he said.

If Georgia was flush with cash, Murphy said, he wouldn't include a proposed funding source -- the surcharge -- in his campaign for new rehab centers.

But right now, according to the Georgia governor's office, the state is $2.6 billion in the red.

"I couldn't see sending forth a bill without having some sort of funding source in it because we need money," Murphy said.

It's unclear how far Murphy's proposal will get. The bill didn't make headway in the state legislature, so now, the state senator said, he'll try to attach it as an amendment to more successful bills.

Making Money Off Marijuana

Proponents for the legalization of marijuana have a fresh argument on their side: Legalizing the drug would open it to regulation and, of course, taxes.

Democratic California assemblyman Tom Ammiano has proposed a bill in the state assembly that would do just that.

"With the state in the midst of an historic economic crisis," Ammiano said in a recent statement, "the move toward regulating and taxing marijuana is simply common sense. This legislation would generate much needed revenue for the state" and provide other benefits, such as freeing up police to pursue "more serious crimes."

A marijuana tax is projected to bring in $1.3 billion in new revenue to the state each year, but that hasn't swayed opponents to legalization.

Groups like Save Our Society From Drugs argue that legalizing marijuana would increase other costs, such as health care, and would lead to societal consequences, including more crime.

Paper Cuts in the Courtroom

Even in the digital age, court proceedings are flush with paperwork. Unfortunately for the Morrow County Municipal Court in Ohio, it doesn't have much paper to work with.

The court stopped requesting new paper supplies after the county went $2,600 in arrears on its office supply bill, leading Judge Lee McClelland to make a headline-grabbing decision: The court wouldn't take any new cases -- be they from the county prosecutor or average Joe plaintiffs bringing a lawsuit -- unless people bringing the cases also brought their own paper.

"It sounds kind of simple, but without paper everything stops," McClelland told ABCNews.com. "We're trying to conserve what we do have so the court doesn't come to a grinding halt."

Since McClelland first announced the policy last week, he's received two donations of paper -- that is, paper not tied to new or pending cases -- but supplies are still tight, he said.

"We're working on day to day right now," he said.

License Plates and Parties

Iowa lawmakers recently solicited suggestions from the public on how the state could cut spending. The response, provided through a Web site, has been encouraging, said Iowa House Minority Leader Kraig Paulsen, a Republican.

"We've been pretty excited about both the quantity and the quality of suggestions," he said.

Iowa House Republicans have seriously considered about two dozen of the public's suggestions, including a proposal to cut the state's license plate requirement from two per vehicle -- one plate on the front and another on the back -- to just one.

"Not only does it save you production costs, my guess is there's also some logistics costs, as well as far as shipping them and making sure you keep them paired up," Paulsen said. "If there was just one, you have 50 percent of products you have to handle."

Another suggestion was to crack down on state government office parties that use state funds to pay for supplies.

While Paulsen acknowledged that parties may provide a morale boost in tough times, he said state employees should pool their own cash to pay for them.

"The taxpayers of Iowa don't need to be funding parties in the state offices," he said. "At least on the surface, it just appears to be something that's flat wrong."

Shining a Red Light on Insurance Scofflaws

By now, many drivers have become grudgingly familiar with the surveillance cameras perched near traffic signals in different parts of the country.

They're there to catch and record the license plates of motorists running red lights. The traffic tickets that are issued as a result of the lights can provide governments with a valuable source of revenue.

Now, the city of Chicago is considering deriving another stream of revenue from the traffic cams: They could be used, proponents say, to catch and fine insurance scofflaws.

The license plate numbers that the cameras catch would be run through a database that would check whether the corresponding vehicle was insured. If not, its owner could be slapped with a fine of up to $500.

Jonathan Miller, the president of InsureNet, an auto insurance verification service, projected that Chicago could see an annual windfall of at least $200 million from such a program.

Others said the program would provide more than just fiscal benefits. It could encourage more people to get insurance.

Charging for 911

Emergencies cost money. Now officials at the Fire Department of the city of Santa Rosa, Calif. hope that the public will help defray the cost.

The department is proposing that Santa Rosa residents pay a $4 per month "subscription" to fund 911 calls. Residents who choose not to subscribe would be billed $350 for each 911 call they make.

"We're into our third round of budget reductions with layoffs and we're looking for every opportunity we can to try to fill a gap in the revenue coming in compared to the cost of service going out," said Deputy Fire Chief Mark McCormick.

McCormick said that 15 California cities have similar subscription programs that have proved successful. Contrary to what some expect, he said, the programs haven't led to a decrease in 911 calls.

But at least one city concluded that 911 subscriptions were a bad idea: Ventura, Calif., dropped its program late in 2008 after encountering billing problems, complaints and a lawsuit.

Soda, iTunes and Haircuts

In New York, some unusual tax ideas have gotten the boot thanks to government stimulus funds. Last week, New York Gov. David Paterson announced that he and state legislature leaders agreed to use more than a billion dollars of stimulus money in lieu of Paterson's proposals to tax sugary drinks, haircuts, manicures, bowling, skiing and online music downloads, among other products and services.

But New York isn't in the clear yet, Paterson said.

"[Officials] cannot treat a temporary windfall from Washington as an excuse to avoid the tough choices we must inevitably make to get our fiscal house in order," he said in a recent statement. "Federal funding will cover only a fraction of our overall budget deficit, and the economic outlook remains uncertain."

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China calls for new reserve currency

By Jamil Anderlini in Beijing

China’s central bank on Monday proposed replacing the US dollar as the international reserve currency with a new global system controlled by the International Monetary Fund.

In an essay posted on the People’s Bank of China’s website, Zhou Xiaochuan, the central bank’s governor, said the goal would be to create a reserve currency “that is disconnected from individual nations and is able to remain stable in the long run, thus removing the inherent deficiencies caused by using credit-based national currencies”.

Analysts said the proposal was an indication of Beijing’s fears that actions being taken to save the domestic US economy would have a negative impact on China.

“This is a clear sign that China, as the largest holder of US dollar financial assets, is concerned about the potential inflationary risk of the US Federal Reserve printing money,” said Qu Hongbin, chief China economist for HSBC.

Although Mr Zhou did not mention the US dollar, the essay gave a pointed critique of the current dollar-dominated monetary system.

“The outbreak of the [current] crisis and its spillover to the entire world reflected the inherent vulnerabilities and systemic risks in the existing international monetary system,” Mr Zhou wrote.

China has little choice but to hold the bulk of its $2,000bn of foreign exchange reserves in US dollars, and this is unlikely to change in the near future.

To replace the current system, Mr Zhou suggested expanding the role of special drawing rights, which were introduced by the IMF in 1969 to support the Bretton Woods fixed exchange rate regime but became less relevant once that collapsed in the 1970s.

Today, the value of SDRs is based on a basket of four currencies – the US dollar, yen, euro and sterling – and they are used largely as a unit of account by the IMF and some other international organisations.

China’s proposal would expand the basket of currencies forming the basis of SDR valuation to all major economies and set up a settlement system between SDRs and other currencies so they could be used in international trade and financial transactions.

Countries would entrust a portion of their SDR reserves to the IMF to manage collectively on their behalf and SDRs would gradually replace existing reserve currencies.

Mr Zhou said the proposal would require “extraordinary political vision and courage” and acknowledged a debt to John Maynard Keynes, who made a similar suggestion in the 1940s.

Copyright The Financial Times Limited 2009

Dutch FinMin targets bonuses; ING in staff appeal

By Catherine Hornby

AMSTERDAM (Reuters) – The Dutch Finance Ministry will seek to curtail bonuses among senior management at financial companies receiving government support, while ING (ING.AS) is asking some staff to give back their 2008 bonuses.

In a letter to parliament, Bos outlined stricter measures to regulate bonus policies at firms receiving government support, noting persistent social discontent regarding the bonus culture of the financial sector.

"A cultural change needs to take place with regards to remuneration policy, particularly in financial institutions receiving support from the government or who were taken over by the government," Bos wrote in the letter.

He said measures to regulate the bonuses of executive board members in firms receiving financial support should also apply to senior management, and he would aim to prevent bonuses being paid to managers in 2009.

He said he would keep the option of going to court open, if necessary, and said he would urge the Dutch Central Bank and market regulator AFM to urgently pay attention to payments at financial institutions, in their role as supervisors.

From Europe to the United States, bonus payments at firms that were bailed out by taxpayers have become a focus of anger during the economic slump.

Millions of people took to the streets in France last week to protest excessive rewards in times of financial meltdown, and a scandal also erupted around American International Group (AIG) (AIG.N) over bonuses to executives of a financial products unit.

A spokesman for ING said on Monday it had launched a "moral appeal to management to hand in bonuses for 2008," confirming an earlier report in Dutch daily De Volkskrant that ING was asking 1,200 employees to return their bonus payments.

The company has also deferred bonuses for 2009 until a new remuneration policy is set, which is due in 2010.

"We will then look back to 2009 and if we made a profit the bonuses will be paid in line with the new policy," the ING spokesman said.

ING received a 10 billion euro ($13.69 billion) capital injection from the Dutch state in October last year and executive board bonuses for 2008 were scrapped.

However, it has faced criticism for bonus payments to staff in 2008, which amount to about 300 million euros.

The Dutch government has also provided a capital injection to insurer Aegon (AEGN.AS), and offers a loan guarantee scheme for banks. Fortis' (FOR.BR) Dutch activities, including ABN AMRO, were nationalized in October.

($1=.7302 Euro)

(Additional reporting by Harro Ten Wolde; Editing by Jon Loades-Carter and Simon Jessop)

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Sweden Says No to Saving Saab

Adam Ihse/Agence France-Presse

Demonstrators in Trollhattan, Sweden, protested on Feb. 26 against the threat of job cuts at the Saab factory there. The loss of 750 jobs was announced two weeks later.

By SARAH LYALL

TROLLHATTAN, Sweden — Saab Automobile may be just another crisis-ridden car company in an industry full of them. But just as the fortunes of Flint, Mich., are permanently entangled with General Motors, so it is impossible to find anyone in this city in southwest Sweden who is not somehow connected to Saab.

Which makes it all the more wrenching that the Swedish government has responded to Saab’s desperate financial situation by saying, essentially, tough luck. Or, as the enterprise minister, Maud Olofsson, put it recently, “The Swedish state is not prepared to own car factories.”

Such a view might seem jarring, coming as it does from a country with a reputation for a paternalistic view of workers and companies. The “Swedish model” for dealing with a banking crisis — nationalizing the banks, recapitalizing them and selling them — has been much debated lately in the United States, with free-market defenders warning of a slippery slope of Nordic socialism.

But Sweden has a right-leaning government, elected in 2006 after a long period of Social Democratic rule, that prefers market forces to state intervention and ownership. That fact has made the workers of Trollhattan wish the old socialist model were more in evidence.

“I don’t think the government knows the situation in this town, how many people depend on Saab,” said Therese Doeij, 25, a clerk at a photo shop who has several friends who work at the company. “To them it’s just a factory. They don’t see the people behind it.”

Governments all over the world are confronting the disintegration of the global automobile market in different ways, with loans, bailouts and takeovers.

But Sweden’s approach has been particularly hard-nosed, and particularly unequivocal.

Why is the government apparently dead set against helping Saab, an iconic brand that stands as a global symbol of Sweden, with Ikea, Volvo and Abba?

That is what Paul Akerlund, the local chairman of the automobile workers’ union, wonders.

“I’m a little surprised,” he said. “They say the market should help itself, but the market has collapsed around the whole world. It’s an extraordinary situation.”

He added, with a note of accusation in his voice, “In Germany, France and England, the government is going in to help the car manufacturers.”

Swedish officials have condemned what they see as protectionism by other European countries that have pledged to prop up their own failing car industries. They have also been scathing about General Motors, Saab’s owner, and the last thing they want is to seem to be bailing out a despised foreign company.

Struggling for its own survival, G.M. has said it will completely pull out of Saab by the end of 2009, a course that Ms. Olofsson, the enterprise minister, described as tantamount to declaring “that they wash their hands of Saab and drop it into the laps of the Swedish taxpayers.”

She said: “We are very disappointed in G.M., but we are not prepared to risk taxpayers’ money. This is not a game of Monopoly.”

Saab lost about $343 million last year. It is now going through a Swedish process known as reorganization, a step short of bankruptcy, as it tries to persuade its creditors to prop it up while it looks for a buyer. Joe Oliver, a spokesman, said in an interview that “around six serious investors,” from Sweden and abroad, had expressed interest.

Time is running out.

But the prospect of failure is too awful for Trollhattan’s mayor, Gert-Inge Andersson, to even contemplate. In a city of about 54,000 people, Saab employs 4,000.

“I’m being optimistic, because I can’t envision a time when Saab doesn’t exist,” Mr. Andersson said in an interview in City Hall.

His son worked at Saab for a decade; his daughter’s boyfriend works there now. “Saab is our identity,” he said. “We have lived with it for many years, and it’s very important to all of us.”

Saab was always known for its innovative engineering. But analysts say that in recent years, with General Motors’s emphasis on volume rather than individuality, it has lost its edge.

“Under G.M.’s ownership, they denuded the intellectual content behind the brand,” said Peter Wells, who teaches at Cardiff Business School in Wales and specializes in the automotive industry. “Its products are not exciting enough, and Saab doesn’t have a strong brand identity anymore.”

The numbers speak all too loudly. Saab sold just 93,295 vehicles worldwide last year, 21,383 of them in the United States. As global demand plummets, the expectations for this year are even more dire. The company announced this month that it planned to lay off 750 workers in Trollhattan.

This is not a rich city. Besides Saab, the largest employer is the municipal government. The houses run mostly to modest wooden two-story structures and low-rise brick apartment buildings. But about 40 percent of the people here drive Saabs, Mayor Andersson said. On a cold evening last month, 3,000 people held a torchlight ceremony to show their support for the company.

Leave the tourist office and you come immediately to the Saab Museum. A shining, sparkling valentine to a company and an industry, it features treasures like the groundbreaking turbo engine unveiled at the 1977 Frankfurt automobile show, and the prototype of the very first Saab car, from 1947 — Ur-Saab, its license plate says proudly. All the cars here, even the rarest and most precious, are still driven from time to time by enthusiasts.

Some 50,000 tourists visit each year, said Ola Bolander, who works at the museum. Saab sponsors a festival for its fans every other year; 20,000 came to the last one, in 2007. “Saab has always been a bit different, a bit more interesting,” Mr. Bolander said. “It’s gone its own way, and it’s in the heart of the Swedish people.”

Sweden has nine million people. Labor leaders say Saab’s collapse would disproportionately affect southwest Sweden, an industrial belt that is also home to Volvo. But it would reverberate through the rest of the economy, which depends heavily on industrial exports, jeopardizing perhaps tens of thousands of jobs.

Sweden is famous for its generous unemployment provisions, which include retraining for laid-off workers. But unemployment is quickly rising. Tomas Eneroth, a member of Parliament and the spokesman for industry and trade for the opposition Social Democrats, said the government’s tough line was foolish.

“The fact that they are so passive,” he said, “is every day now making it worse and jeopardizing the possibility of having Saab still in Sweden.”

Around the corner from City Hall, Johann Riden, a sales clerk in an electronics store, said about half his customers worked either at Saab or at companies that do business with Saab.

“I have friends there, my colleagues have family there, and my friends have family there,” said Mr. Riden, 32. “If you look around, you see Saab everywhere.”

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Energy Efficiency Could Save Us $168 Billion

Written by Jerry James Stone

Energy efficiency initiatives that reduce electricity and gas usage could save consumers and businesses up to $168 billion, says the American Council for an Energy-Efficient Economy (ACEEE). The report comes on the heels of the Campaign for an Energy-Efficient America: a group of business leaders, industry groups, and environmental advocates calling on Congress to enact a federal energy efficiency target.

“Energy efficiency is one of the most effective ways to address our nation’s energy and climate challenges while creating jobs and saving Americans money,” stated Steven Nadel, Executive Director of ACEEE. “In these difficult economic times, investment in energy efficiency makes more sense than ever and should be a top priority for our nation’s leaders.”

ACEEE’s report, Laying the Foundation for Implementing a Federal Energy Efficiency Resource Standard, analyzes both 2008 economic and energy data. If a federal energy efficiency resource standard (EERS) were adopted, one that demanded a electricity reduction of 15-percent and a natural gas reduction of 10-percent, 262 million metric tons of greenhouse gas emissions could be prevented. That is the equivalent of taking 48 million cars off the road for one year.

Other benefits include 220,000 net permanent jobs and 390 power plants that won’t need to be built.

The Campaign for an Energy-Efficient America supports a federal EERS, included in both House and Senate versions (H.R. 889 and S. 548) of the Save American Energy Act, introduced by Rep. Edward Markey (D-MA) and Sen. Charles E. Schumer (D-NY).

“As this coalition shows, the idea of a national energy efficiency standard draws support from a wide range of business and environmental groups in order to save money for consumers, create long-term jobs that cannot be outsourced, and reduce greenhouse gas emissions,” said Reid Detchon, Executive Director of the Energy Future Coalition, a nonpartisan public policy initiative that seeks to speed the transition to a new energy economy.

Currently 19 states have adopted individual EERS programs, but the real potential comes from a federal implementation. ACEEE analyzed the benefits of a federal EERS for each state by 2020. For example:

• Florida will create more than 19,500 new jobs and save $14 billion in energy costs.
• Illinois will create more than 6,500 new jobs and save $3.6 billion in energy costs.
• Indiana will create more than 5,000 new jobs and save $3.6 billion in energy costs.
• North Carolina will create nearly 6,500 new jobs and save $3 billion in energy costs.
• Tennessee will create more than 5,000 new jobs and save $3.5 billion on energy costs.

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Cafe owner thrives with no-pricing policy

By amzolt

I hang out at a local café (you may have noticed I use many imaginative dialogues at the beginning of posts and they’re almost always in a café). I also do some of my own work at the café plus volunteering a little marketing and promotion—basically, I like the place.

However, this creeping, crawling economic downturn (aka recession or crunch) hit the owner of Java Street Café pretty hard. I’ve spent hours talking business with him and watched as a bright and friendly man became progressively morose and extremely exhausted (when a business has hard times, paying employees becomes a problem and the owner has to not only run the business but literally Work it).

Months went by, things getting worse, while the owner, Sam, in spite of the grueling conditions, continued to try various ideas to attract customers…

Finally, last week, an idea he’d been experimenting with became a what-the-hell—”I can’t lose more than I already have”—Decision:

Take All The Prices Off The Menu—let people pay whatever they feel is a Fair Price!

Sam had his back against the wall, he was willing to try just about anything, and he “happened” to choose and made a commitment to act on what could seem like a very crazy idea…

That was last week…

Since then, he’s been interviewed on CNN twice, phone interviewed on MSNBC and Fox, appeared on all four of the local channels, been on three out-of-state radio talk shows, will be appearing in a morning cooking segment on the local Fox affiliate, and received calls of thanks from three other states and Canada…

As if that weren’t enough, the blogosphere is starting to warm up to the story and it’s on the edge of tipping into the viral realm.

Why?

Because it’s “crazy” and unusual?

Nope.

That may have been the initial and conscious decision of the media but, after watching it happen and, especially, watching his customers react, the real and deeper reason for all the interest certainly seems to be related to a nearly archaic principle—Business Ethics…

Sam’s customer’s have a variety of reactions when he takes their order then says, “O.K., what do you think is a fair price for what you just ordered ?”:

“Huh?”

“Me?”

“What’s your usual price?”

“Oh, my! I have to think about it?”

“You’re kidding, right?

Sam’s not kidding, they do have to think about it, his “usual” price is now “your price”, and, when the day is done, the under-payers and the over-payers even out and he’s collecting what he used to get when he had prices…

Of all the various reactions, my personal favorite, and the one that sings of ethics in business during hard times, is what the woman from Missouri said, when she called to thank Sam for his decision:

“After I saw the story on CNN, I cried…”

Spiritual Quote:

“As a practical step in contributing to a dialogue about development and social transformation that explicitly takes account of spiritual values and perspectives, some 100 influential development organizations, international and government agencies, religious representatives, and academics recently gathered in New Delhi to participate in a colloquium on the theme of Science, Religion and Development. The primary goal of the event was to explore how a unified interaction between scientific methods and religious insights can promote the building of human capacity, particularly in the areas of governance, education, technology and economic activity.”
2001 Jun 11, Universal House of Justice, Overcoming Corruption

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The World's Cheapest Car Debuts in India

By JYOTI THOTTAM / PUNE

In New Delhi in the early 1970s, my family traveled by scooter in the classic, death-defying Indian fashion. My father would drive, with me, a toddler, standing in front gripping the handlebars and my mother seated pillion, my infant sister in her arms. My father was a civil engineer and my mother a nurse, and in India at that time, cars for a young family were far out of reach.

More than 30 years later, I recently listened to Ratan Tata, chairman of one of India's largest companies, describe a family just like mine as the inspiration for the Nano, the ultra-cheap "people's car" that Tata Motors officially launches today. "What sparked it off was riding in a car and looking at them and saying, 'surely there's a safer way that these people can be transported,'" Tata recalls. (See the dozen most important cars of all time.)

That incident was the beginning of a six-year quest by Tata Motors, India's largest automaker, to develop a car for the common man costing less than Rs 100,000 (about $2,000), roughly the same price as a motorcycle. Many thought Tata was bound to fail, that a car so cheap wouldn't be much of a car at all. The Maruti 800, India's best-selling sub-compact, costs almost twice as much. The chairman of Suzuki Motor, Osaka Suzuki, once said: "Tata will not be able to make a one-lakh car." (Lakh is an Indian word for 100,000.)

The company has proven the doubters wrong. The Nano is going on sale at Tata's 470 outlets in India; the base model does indeed carry a sticker price of Rs 100,000. Now, with global car sales in the worst slump in decades — Tata Motors itself is experiencing financial difficulties — the battered automotive industry is looking to the debut of the world's cheapest car for clues to a future that could revolve around smaller, more fuel-efficient and more cheaply produced vehicles. (See the 50 worst cars of all time.)

In an exclusive March 5 interview with TIME, Tata downplayed the tough market conditions and the impact that sagging consumer demand could have on Nano sales. Although car loans are harder to come by in India due to the credit crisis, the country's economy is still growing. "If I had conceived a million-dollar supercar today, I think you'd have every reason to question whether that's the right product at the right time in the planet that we are living in today," Tata says. The Nano, he argues, is the right car for this difficult time. "What has happened in the changing economic situation globally reinforces, if nothing else, the fact that a low-cost car has a place."

Tata Motors engineers developed the Nano by redesigning every component to minimize cost and weight, while trying to maintain performance and comfort. To see how well they accomplished their mission, I was offered the chance to drive a Nano on a test track at Tata Motors' main plant in the western Indian city of Pune. (See pictures of the Nano.)

The first thing you notice is that the dashboard holds just two gauges: speedometer and fuel level. This is the basic model, and it's stripped down to the bare essentials. But driving the car is surprisingly easy. The gearshift is smooth, the car accelerates adequately and you never feel cramped or low to the ground. The Nano doesn't feel like a cheap, lightweight car that's going to tip over with the first sudden turn.

Outside the Tata Motors facility, our photographer got to drive a fully equipped, bright yellow Nano along the highways, cobbled avenues and side streets of Pune. This car had air conditioning, worth the extra money in India (optional-equipment costs had not been released at the time this was written), but running the aircon sapped some of the power of the tiny, two-cylinder engine. Other drawbacks of the car: The storage space is hard to access because the hatchback doesn't open, the brakes aren't progressive, and the car we drove pulled slightly to the left even though there were just 40 km on its odometer. (See pictures of muscle cars.)

Those quibbles are unlikely to make a difference to potential buyers. The Nano's target customers are people riding two-wheelers, and for most of them, this is the only car they could hope to buy. Even without spending anything on marketing so far, Tata executives expect demand to far exceed their initial annual production capacity of 45,000 Nanos. Tata Motors had planned to build about 250,000 cars a year, but the company was forced to shut down its original Nano factory last fall after protests by people displaced by its construction turned violent. That disruption forced Tata Motors to relocate its main Nano production line and delayed the launch. Because plants in Pune and Pantnagar are now producing the car in reduced numbers, the company is bracing for long waiting lists and disappointed customers.

The lower volume means the Nano will do little for Tata Motors' revenue and profits, at least initially. Vaishali Jajoo, a senior automotive research analyst at Angel Broking, an investment firm in Mumbai, says that even at projected output of about 250,000 cars a year, she expects the Nano will add just 3% to annual sales. Because the profit margin on Nano sales is small, "It will take at least four to five years to break even" by recouping development costs, Jajoo says. Fully equipped Nanos have higher margins, but the company has not yet decided how many of those it will produce. A company spokesman declined to comment on analyst reports regarding the Nano's launch, calling them "speculative."

Initially, the Nano will be sold only in India. The company plans to begin selling a European version in 2011. It has no plans yet to export the Nano to the U.S., although that has not been ruled out.

The Nano's slow start comes at a time when Tata Motors is struggling financially due to slumping demand. The company in the quarter ending Dec. 31 reported a $58.5 million loss, its first loss in seven years. Loans for Tata Motor's $2.3 billion purchase of loss-making luxury car brands Jaguar and Land Rover from Ford Motor are coming due. "That's a major cash-flow crunch for them," Jajoo says. Jaguar and Land Rover sales have tanked. The company is pursuing several options to meet its obligations, including getting a bailout from the British government. (Vote for the 2009 TIME 100 Finalists.)

The Nano certainly won't solve Tata Motors' immediate problems. But Tata says he hopes the groundbreaking vehicle will in the long run help redefine not only how much cars cost, but also how they are made. The future of the car industry, he says, lies in design and marketing — not manufacturing, which involves high costs and increasingly can be farmed out to other companies. If the Nano really takes off, Tata Motors may try "distributed manufacturing" — selling Nano kits to be assembled and sold by independent dealers. This, says Tata, would be a step toward fully outsourced manufacturing. "What I tried to describe on the Nano is an attempt to look at that as a business model," Tata says. A new way of doing business may be something the beleaguered auto industry needs even more than a cheap new car.

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Why It's Getting Harder to Evade Taxes

By ADAM SMITH

Politicians don't usually like being interrupted during interviews. But sometimes it's worth making an exception. During a sit-down conversation with TIME last week, British Prime Minister Gordon Brown happily broke off to read a faxed letter handed to him by an aide. As anticipated, the note, from the Swiss President, brought welcome news: Switzerland was finally relaxing its decades-old banking-secrecy laws. "That is a major step forward," Brown enthused, brandishing the fax between his fingers. "This," he said, marks "the beginning of the end of tax havens."

That may be too optimistic. There will always be some corner of the globe offering itself up as a place people can squirrel away their money. But Brown is right that Switzerland's decision to share information with other countries in cases of suspected tax evasion is revolutionary, not least because the Alpine nation's identity is so closely tied to its famously discreet banks. And Switzerland wasn't the only one making concessions last week. Andorra, Austria, Liechtenstein and Luxembourg all pledged to meet the same international standards on cooperation. Singapore and Hong Kong had promised much the same a few days earlier.

They had to do something. With the global downturn squeezing tax revenues, and state bailouts putting taxpayers on the hook for billions of dollars, patience for banking systems that offer shelter to tax dodgers has finally run out. U.S. and European officials have been falling over each other with their promises to go after tax cheats. With the issue on the agenda for next month's meeting in London of the Group of 20 (G20) nations, change was almost inevitable. "Given the crisis, and the imminence of the G20 meeting," says Angel Gurría, secretary-general of the Paris-based Organisation for Economic Cooperation and Development (OECD), which drew up the international standards for transparency and information exchange on tax in 2004, "it was time to move. The important thing is they all moved together."

It's hard to feel sorry for the jurisdictions being squeezed. Offering low or no taxes to foreign firms and individuals parking money with them; snubbing requests for information from overseas tax authorities; or indeed both, offshore financial centers provide the perfect conditions for anyone who wants to hide cash illegally from the taxman back home. That cheats governments out of money to build roads and schools and hospitals, not to mention the funds to bailout banks. Accurate estimates for the value of assets held offshore are as hard to pin down as the havens themselves. The Tax Justice Network, an independent London-based group, thinks the figure could be as high as $11.5 trillion, while U.S. Democratic Senator Carl Levin, who introduced an anti-tax-haven bill in Congress earlier this month, estimates that the U.S. government loses some $100 billion in revenue every year because of offshore tax dodges.

Governments have sometimes managed to claw back lost income. UBS, Switzerland's biggest bank, last month paid $780 million in fines and handed over the names of about 300 U.S. clients to American authorities after admitting the Swiss bank helped customers evade tax. And data bought by German authorities from a whistle-blower in Liechtenstein last year revealed hundreds of cases of suspected tax evasion. One of those caught out: former Deutsche Post boss Klaus Zumwinkel, who was convicted of tax evasion in January and received a suspended sentence and a $1.3 million fine.

Keen to clean up its image in the wake of the scandal, Liechtenstein agreed in December to share information with U.S. authorities in cases of suspected tax evasion by U.S. citizens. That's unusual. In the past, requests for data from offshore financial centers have mostly fallen on deaf ears. In Switzerland, tax fraud is considered a crime, but tax evasion is not. That's meant that bank secrecy can be waived in suspected cases of fraud but not in cases of suspected evasion.

Until now. Under the OECD's standards for cooperation, information is shared with foreign authorities on a case-by-case basis, and only where requests for data are targeted and justified as part of an ongoing investigation. In other words, "it doesn't mean I can send you the Yellow Pages and ask you to give me information on every name that appears," says the OECD's Gurría. The procedure "doesn't lend itself to frivolous requests."

Some argue that going after tax havens is nothing more than a distraction from much bigger issues with which the G20 will be grappling — pesky things such as stabilizing financial markets, reforming the global financial system and returning the economy to stable growth. Focusing on tax havens would be "nothing short of a catastrophe, when you've got an opportunity to make a difference," Martin Broughton, president of British employers' group the CBI, told the Financial Times this month. Tax havens, said Broughton, are "totally irrelevant" to getting out of the current slump.

But the OECD's Gurría scoffs at the idea that tax havens are red herrings. Tackling secrecy in offshore centers "is part of the process, part of the effort," he says. "If we're getting together to save the banks, if we're getting together to give guarantees and we're getting together in order to coordinate stimulus packages, how is it possible we can't agree on the fact that we all treat each other in a relatively comparable way when it comes to taxes?"

That's true. But another possible reason for the cleanup's timing is that politicians know that getting tough on tax evaders won't lose them any votes. With taxpayers shouldering enormous bailouts in recent months, tapping into their feelings of unfairness is a popular move. "There is a real sense that the tax burden is not falling on the richest" in Europe, says Nicolas Véron, a finance scholar at the Bruegel think tank, in Brussels. "At the same time, a number of governments know they will have to raise taxes, and are trying to get some of it back into the country."

A recent OECD update on progress toward meeting international standards chided Austria, Singapore and Switzerland, among others, for not doing enough. The threat of blacklisting by the G20 and of retaliatory measures, such as tougher financial-reporting requirements for companies engaging with offshore centers, was apparently enough to make the holdouts see the light.

The OECD says it will now consider removing Liechtenstein and Andorra from its list of "uncooperative" jurisdictions and also hints that even Monaco — the third member of that list — "may be prepared to move in the same direction." But the organization will need to keep a close eye on the countries pledging greater openness. Dozens of jurisdictions have promised to move on transparency and information sharing in recent years, but not all have followed through. Panama, for one, has done little to honor its commitments to the OECD. Gibraltar, too, has shown similar disdain for the standards.

Authorities in such places might do well to consider the thoughts of Anne Bolomey, a retired civil servant in the small Swiss town of Morges, many of whose citizens work for banks in nearby Lausanne and Geneva. Switzerland's decision to relax its precious banking secrecy means the country avoids "isolating ourselves even further from our European neighbors. And in any case," says Bolomey, sipping tea in a local café, "having a reputation as a tax haven is not something Switzerland should be known for." With reporting by Helena Bachmann / Morges, Leo Cendrowicz / Brussels and Catherine Mayer / London

Secret Stash

$100 billion Annual tax revenues the U.S. is estimated to lose to offshore tax abuse

$11.5 trillion Estimated value of assets taxpayers in all countries hold offshore

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More women needing cash go from jobless to topless

By KAREN HAWKINS, Associated Press Writer

CHICAGO – As a bartender and trainer at a national restaurant chain, Rebecca Brown earned a couple thousand dollars in a really good week. Now, as a dancer at Chicago's Pink Monkey gentleman's club, she makes almost that much in one good night.

The tough job market is prompting a growing number of women across the country to dance in strip clubs, appear in adult movies or pose for magazines like Hustler.

Employers across the adult entertainment industry say they're seeing an influx of applications from women who, like Brown, are attracted by the promise of flexible schedules and fast cash. Many have college degrees and held white-collar jobs until the economy soured.

"You're seeing a lot more beautiful women who are eligible to do so many other things," said Gus Poulos, general manager of New York City's Sin City gentleman's club. He said he got 85 responses in just one day to a recent job posting on Craigslist.

The transition to the nightclub scene isn't always a smooth one — from learning to dance in five-inch heels to dealing with the jeers of some customers.

Some performers said they were initially so nervous that only alcohol could calm their nerves.

"It is like giving a speech, but instead of imagining everyone naked, you're the one who's naked," Brown, 29, said.

Eva Stone, a 25-year-old dancer at the Pink Monkey, said dealing with occasional verbal abuse from patrons requires "a thick skin."

Makers of adult films cautioned that women shouldn't rush into the decision to make adult movies without considering the effect on their lives.

"Once you decide to be an adult actress, it impacts your relationship with everyone," said Steven Hirsch, co-chairman of adult film giant Vivid Entertainment Group. "Once you make an adult film, it never goes away."

The women at the Pink Monkey say dancing at a strip club might not have been their first career choice, but they entered the business with their eyes wide open. The job gives them more control and flexibility than sitting in a cubicle, and "it's easy, it's fun and all of us girls ... look out for each other," Brown said.

In this economy, "desperate measures are becoming far more acceptable," said Jonathan Alpert, a New York City-based psychotherapist who's had clients who worked in adult entertainment.

For some, dancing is temporary, a way to pay for college loans or other bills. Others say they've found their niche.

Dancers at the upscale Rick's Caberet clubs in New York City and Miami can make $100,000 to $300,000 a year — in cash — even with the economic downturn, club spokesman Allan Priaulx said.

Priaulx said 20 to 30 women a week are applying for jobs at the New York club, double the number of a year ago.

Rhode Island's Foxy Lady held a job fair Saturday, seeking to fill about 35 positions for dancers, masseuses, bartenders and bouncers. The Providence Journal reported that more than 150 job seekers showed up to apply for work at the strip club. Foxy Lady co-owner Tom Tsoumas said a recent promotion to cut prices helped the club regain business lost due to the bad economy, forcing it to hire more employees.

Still, analysts say, the industry isn't immune to the economic recession. Business is down an estimated 30 percent across all segments, including adult films, gentleman's clubs, magazines and novelty shops, said Paul Fishbein, president of AVN Media Network, an adult entertainment company that has a widely distributed trade publication and an award show.

"In the past, people have said this industry is recession-proof," said Eric Wold, director of research for financial services firm Merriman Curhan Ford. "I definitely don't see that; maybe recession-resistant."

Strip club dancers and managers said they're drawing in the same number of customers, but fewer high rollers.

"They're not getting the big spenders," said Angelina Spencer, executive director of the Association of Club Executives, a trade group for adult nightclubs. "They're not getting the guys who come in and drop $3,000 to $4,000 a night anymore."

Still, the clubs' operating structure leaves them with low overhead and profit margins of up to 50 percent, Wold said.

Dancers are independent contractors, paying clubs a nightly flat fee depending on how long they work. At the Pink Monkey, for example, dancers who arrive at 7 p.m. Sunday through Thursday pay a $40 "house fee," while women who don't arrive until midnight pay $90. And they keep their tips.

Wold and others say it's almost impossible to estimate the size of the adult entertainment industry because few companies are publicly traded. He does pay close attention to three that are: Lakewood, Colo.-based VCG Holding and Houston-based Rick's Caberet, which own clubs, and New Frontier Media, a Boulder, Colo.-based adult film producer and distributor.

All three are profitable.

Rick's Caberet had $60 million in revenue in its 2008 fiscal year, up from $32 million the year before, Wold said, and he estimates VCG will have $57 million for last year, compared with $40.5 million in FY2007. New Frontier Media generates more than $400 million in consumer buying a year.

Larry Flynt, whose half-billion dollar Hustler empire publishes magazines, produces and distributes films and operates a casino, said he's continued to do well. But he doesn't expect those who are solely in the film business to survive.

"A lot of the small studios are out of business now, there's no doubt about that," Flynt said.

Adult magazines also are struggling along with the larger publishing industry, and have to cut pages like everyone else.

But the economic realities aren't keeping jobseekers away.

Vivid Entertainment's Hirsch said the number of women in his business has doubled in the last couple years, with roughly 800 working as adult actresses. "It is more competitive than I've seen it in 25 years," he said.

That doesn't mean all the newcomers are planning on lengthy careers in the industry.

Stone, who has a bachelor's degree in graphic design, took up dancing four years ago to help pay her student loans. She plans to go to graduate school this year to pursue a master's in education.

Brown, meanwhile, has a ready answer for those critical of her career choice.

"I have job security," she said.

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WaMu sues FDIC for more than $13 billion over forced sale

Stephen C. Webster

Washington Mutual, the bankrupt, seized and "under investigation" financial institution which saw some operations forcibly sold off to JPMorgan Chase in 2008, is suing the agency that guarantees Americans' deposits, and that agency is running low on funds.

Washington Mutual (WaMu), formerly one of the nation's most prestigious banks and alleged holder of over $307 billion in assets, is suing the Federal Deposit Insurance Corporation for more than $13 billion over the roll-up of its banking division into JPMorgan Chase & Co.

Washington Mutual was seized by federal regulators in Sept. 2008; the company filed for bankruptcy immediately thereafter. The ensuing investigation "one of the largest and most complex federal investigations ever undertaken in Western Washington," a US Attorney told the Seattle Times

"In a complaint filed with the U.S. District Court for the District of Columbia, the thrift's former parent accused the FDIC of having on January 23 made a 'cryptic disallowance' of its claims, prompting the lawsuit," reported Reuters.

"It also accused the FDIC of agreeing to an unreasonably low price in arranging the a $1.9 billion sale of the banking business to JPMorgan on September 25, when regulators seized Washington Mutual and appointed the FDIC as receiver."

"On a Friday night in September 2008, the government forced WaMu into a shotgun marriage with new owners at pennies on the dollar. The FDIC seized the bank and then sold it to JPMorgan Chase for $1.9 billion," reported MSNBC.

"[A] federal task force continues to comb through a mountain of documents looking into possible criminal charges against WaMu executives. It's looking for fraud in how the company built such an unstable business based on subprime mortgages."

When banks insured by the FDIC are seized or declare bankruptcy, the agency returns depositors' funds up to $100,000.

"The thing is, the FDIC that is supposed to pay customers is running low — there have just been a lot of bank failures..." noted NPR's Jim Zarroli when JPMorgan Chase agreed to purchase WaMu's banking division.

On the same day the United States saw its 20th bank failure of 2009.

An FDIC spokesman would not comment on the suit to Reuters.

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Post Office Offering Early out, Cutting Managers

By RANDOLPH E. SCHMID Associated Press Writer

Battered by the economy, the post office is offering early retirement to 150,000 workers, cutting management and closing offices, the agency said Friday.

In this file photo, people use mail services at the James Farley Post Office building in New York...

In this file photo, people use mail services at the James Farley Post Office building in New York City. Battered by the economy, the post office is offering early retirement to 150,000 workers, cutting management and closing offices, the agency said Friday.

(Spencer Platt/Getty Images)

The Postal Service lost $2.8 billion last year and is facing even larger losses this year, despite a rate increase — to 44 cents for first-class mail — scheduled to take effect May 11.

The agency said it will reduce management staff nationwide by 15 percent, with more than 1,400 processing, supervisor and management posts at 400 facilities being eliminated.

And another 150,000 postal workers will be offered early retirement.

The agency also made early retirement offers last year but unions discouraged their members from accepting the offers and they were not widely used. The post office did not say if the new proposal would include financial incentives.

The American Postal Workers Union issued a statement Friday saying: "Retirement is a personal matter, and the union defers to the decisions of employees who meet the qualifications."

However, the union said it continues to challenge the Postal Service's authority to offer voluntary early retirement without including severance pay.

The 80 district across the country will be reduced by six with the closings in Lake Mary, Fl.; North Reading, Mass.; Manchester, N.H.; Edison, N.J.; Erie, Pa.; and Spokane, Wash.

District offices handle administrative functions and officials said the closing should not affect local mail delivery. The closings were expected to take about five months.

The first quarter of the fiscal year — October through December — is usually the post office's busiest, but it still posted a loss of $384 million for the period.

Officials said the economic recession contributed to a 5.2 billion piece mail volume decline compared to the same period last year. If there is no economic recovery, the Postal Service projects volume for the year will be down by 12 billion to 15 billion pieces of mail.

The post office said that over the past year it has cut 50 million work hours, stopped construction of new postal facilities; froze salaries for postal executives, began selling unused facilities and cut post office hours.

In addition, it is negotiating an agreement with the National Association of Letter Carriers to adjust carrier routes to reflect diminished volume.

Postmaster General John Potter has even asked Congress to consider allowing the agency to cut mail delivery back to five days-a-week to save money.

The post office does not receive a taxpayer subsidy for its operations.

———

On the Net:

Postal Service: http://www.usps.com

Copyright 2009 The Associated Press.

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Israel army 'used human shields'

The offensive in Gaza meant operating in areas with large civilian populations

United Nations investigators have accused the Israeli army of using an 11-year-old boy as a human shield during its recent Gaza offensive.

Their report says troops ordered the boy to walk in front of them for several hours under fire, entering buildings and opening suspect packages.

The UN team responsible for protection of children in war zones says it found "hundreds" of similar violations.

Israel has denied the charges, saying morals are "paramount" in its army.

Israel's ambassador to the UN criticised the report as "unable or perhaps unwilling" to address attacks against its civilians by Palestinian militants.

The lead investigator, Sri Lankan lawyer Radhika Coomaraswamy, said the incident with the boy in the Gaza neighbourhood of Tel al-Hawa on 15 January was a violation of Israeli and international law.

The report... wilfully ignores and downplays the terrorist and other threats we face Aharon Leshno Yaar Israeli Ambassador

Her report also accuses Israeli soldiers of shooting Palestinian children, bulldozing a home with a woman and child still inside, and shelling a building they had ordered civilians into a day earlier.

She cited the case of one family where the father was ordered out of his home and shot. Soldiers then fired on the family inside, killing one child and wounding the mother and three children.

She added that her report contained "just a few examples of the hundreds of incidents" that had been verified by UN officials in the Gaza Strip.

Ethic standards

An Israeli military spokesman dismissed the UN findings as inaccurate and politically motivated.

"We are an army to which morals and high ethical standards are paramount," Capt Elie Isaacson said.

"The report claims to examine Israel's actions while it wilfully ignores and downplays the terrorist and other threats we face," Ambassador Aharon Leshno Yaar told the UN's 47-nation Human Rights Council.

Ms Coomaraswamy, who is the secretary-general's special envoy for protecting children in armed conflict, said the UN is also investigating claims the Palestinian militant group Hamas used human shields during the three-week Gaza conflict.

Israel's military last week ordered an inquiry after some soldiers admitted killing unarmed Palestinian civilians during the operation which ended on 18 January.

Medical authorities say more than 1,300 Palestinians died in the Israeli offensive. It is not known how many of them were combatants belonging to militant groups.

The dead including some 440 children, 110 women, and dozens of elderly people. Israel has blamed Hamas for using civilians as human shields, which Hamas has denied.

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Thai 'Spider-Man' to the rescue

The child was persuaded off the ledge by his favourite superhero

An unusual disguise has helped a Bangkok fireman rescue an eight-year-old boy who had climbed on to a third-floor window ledge, Thai police say.

The firefighter dressed up as the comic book superhero Spider-Man in order to coax the boy, who is autistic, from his dangerous perch.

Police said teachers had alerted the fire station after the boy began crying and climbed out of a classroom window.

It was reportedly his first day at the special needs school.

Efforts by the teachers to convince the pupil back inside had failed.

But a remark by his mother about his passion for comic superheroes prompted fireman Somchai Yoosabai to rush back to the station, where he kept a Spider-Man costume in his locker.

The sight of Mr Yoosabai dressed as Spider-Man and holding a glass of juice for him, brought a big smile to the boy's face, and he promptly threw himself into the arms of his "superhero", police said.

Mr Yoosabai normally uses the costume to liven up fire drills in schools.

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Corrupt cops lead NY mayor to consider 'martial law'

Stephen C. Webster

A New York town's decades-long struggle with police corruption has its mayor considering potential measures most would consider drastic: disbanding the entire department and declaring "martial law."

"It may be that as a stopgap measure, that you would need military forces - State Police, National Guard," said Brian Stratton [pictured on right], mayor of Schenectady, New York.

"The governor would have to declare it and then the National Guard would come in," reported Capital News 9. "The mayor said it's more for a transition to a new police force if that were to happen."

Controversy over Schenectady's officers is nothing new.

"My father who served in this office from 1956 to 1958 was battling police corruption," said Stratton in a separate report by Capital News 9.

"Years later, the battle continues as at least five Schenectady police officers face possible termination," reported the station.

"Public Safety Commissioner Wayne Bennett says under the law, he's not allowed to consider the opinions of Mayor Stratton but he says the mayor has given him full authority to make whatever decisions have to be made in these cases," reported Fox 23 in Albany, NY.

"The six officers who may be fired are Darren Lawrence, accused of driving drunk, crashing in Colonie, fleeing the scene and beating a friend to keep him from reporting the incident; Michael Brown [pictured at left], accused of driving drunk, hitting another car, fleeing the scene and refusing a Breathalyzer test; John Lewis, accused of DWI, threatening to kill his ex-wife and numerous other charges; Gregory Hafensteiner and Andrew Karaskiewicz, accused of beating a drunken man during an arrest; and Dwayne Johnson, accused of leaving work four hours early on numerous Tuesdays," reported the Daily Gazette.

New York Attorney General Andrew Cuomo plans a community forum in Schenectady on Tuesday to hear a litany of complaints from residents, not all of them centered on the police abuses.

Police Chief Mark R. Chaires, appointed in Sept. 2008, was taken by surprise by the options his mayor is considering.

"When I think of martial law, I think of rioting," he told Capital News 9. "I think of Watts riots and things like that. I haven't seen anything that rises to that level. I was a little surprised to hear that."

Chaires pledged in Feb. to fire several of the officers involved. He specifically wondered why department supervisors failed to notice officers stealing time

In January, the head of the city's civilian complaint review board resigned and complained that his role as a lead investigator had been relegated to dropping off complaints at police headquarters.

An ineffectual review board only serves to reinforce the perception that the Schenectady Police Department is a rogue organization that operates without legitimate oversight," opined NYCLU Director Melanie Trimble.

"I'd like to go one week where we don't have a negative newspaper article about the department," said City Councilman Gary McCarthy, in a report by the Times-Union. "It's just baffling that it just keeps happening. It's human nature that people are going to make mistakes, but this just seems so institutionalized."

"In the meantime, terminating these guys — for such serious offenses as driving drunk then leaving the scene of a personal injury accident; beating up a DWI suspect while taking him to the police station; driving drunk, then assaulting a passenger and fleeing the scene; driving drunk and violating numerous orders of protection to harass your spouse; and regularly taking hours off during a shift while also collecting huge amounts of overtime — seems justified," editorialized the Daily Gazette.

"From the city’s perspective, a worst-case scenario is that the firings would cost a lot of money to defend and wouldn’t hold up. In the meantime, though, the bad apples would have to stew in their own juices, pay their own legal expenses, and be ineligible to collect overtime. No officer would be likely to find such a prospect attractive, and the specter just might keep other officers honest. Wouldn’t that be a novelty?"

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Prison officer sacked after befriending inmates on Facebook

By Daily Mail Reporter

A prison officer dismissed for gross misconduct befriended inmates on social networking site Facebook, it has been revealed.

An investigation found Nathan Singh, who worked at HMP Leicester, had been associating with both serving and former prisoners on the website.

The 27-year-old was dismissed in January for gross misconduct after an investigation found he had inappropriate relationships with 13 criminals.

Prison officer Nathan Singh was sacked from his job at Leicester Prison after 13 criminals were discovered on his Facebook page

His links to the criminals were discovered following a prison probe into his activities last year.

The Sun newspaper today reported that an investigation found 27-year-old Singh made friends with the criminals on Facebook.

It is believed they included burglars, fraudsters, and someone who had stabbed someone to death outside a nightclub.

Six of those criminals had received convictions but had not served time in prison for their offences.

One of the photos found on the site included Singh with convicted fraudster Tyrone Leadeatt, who is serving 2 1/2 years in prison for 24 offences.

Singh claimed at an earlier disciplinary hearing that he knew most of the group from school of through playing football.

Today a Prison Service spokesman said the prison officer had been associating with serving and former prisoners, outside the course of his employment and without authority.

'We take inappropriate relationships with prisoners very seriously and staff who break the rules are liable to be dismissed,' he said.

'We carry out thorough checks when we recruit prison officers, looking at character and criminal records as well as nationality and identity.

'The vast majority of our staff are honest, hard-working and professional. We work to create and support a culture which values integrity above all and rejects corruption and dishonesty.'

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UN: Israel used 11-year old as human shield

Celebrating 'victory', Israeli style

GENEVA – Israeli soldiers used an 11-year-old Palestinian boy as a human shield during the war on the Gaza Strip, UN human rights experts said Monday.

The Israeli Defense force ordered the boy to walk in front of soldiers being fired on in the Gaza neighborhood of Tel al-Hawa and enter buildings before them, said the UN secretary-general's envoy for protecting children in armed conflict.

The boy also was told to open the bags of Palestinians — presumably to protect the soldiers from possible explosives — before being released at the entrance to a hospital, Radhika Coomaraswamy said.

She said the Jan. 15 incident, after Israeli tanks had rolled into the neighborhood and during "intense operations," was a violation of Israeli and international law.

It was included in a 43-page report published Monday, and was just one of many verified human rights atrocities during the three-week war that ended Jan. 18, she said.

Coomaraswamy accused Israeli soldiers of shooting Palestinian children, bulldozing a home with a woman and child still inside, and shelling a building they had ordered civilians into a day earlier.

"Violations were reported on a daily basis, too numerous to list," said Coomaraswamy, who visited Gaza and Israel for five days in February.

Israel criticized the report as "unable or perhaps unwilling" to address Hamas rocket attacks from Gaza.

An Israeli army spokesman rejected the UN claim.

"We are an army to which morals and high ethical standards are paramount," said Capt. Elie Isaacson.

Coomaraswamy said her list of Israeli violations constituted "just a few examples of the hundreds of incidents that have been documented and verified" by UN officials who were in the territory.

She was the only one of the nine UN experts who compiled the report that was allowed into Gaza following the war. The experts covered issues ranging from health and hunger to women's rights and arbitrary executions.

The report called for Israel to investigate human rights abuses that occurred during the conflict.

Last week Israel's military ordered a criminal inquiry into published reports from soldiers that some troops had knowingly killed Palestinian civilians, including children.

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