New Zealand police raided several homes and businesses linked to the founder of Megaupload.com, a giant Internet file-sharing site shut down by U.S. authorities, on Friday and seized guns, millions of dollars, and nearly $5 million in luxury cars, officials said.
Police arrested founder Kim Dotcom and three Megaupload employees on U.S. accusations that they facilitated millions of illegal downloads of films, music and other content costing copyright holders at least $500 million in lost revenue. Extradition proceedings against them could last a year or more.
With 150 million registered users, about 50 million hits daily and endorsements from music superstars, Megaupload.com was among the world’s biggest file-sharing sites. According to a U.S. indictment, the site, which was shut down Thursday, earned Dotcom $42 million in 2010 alone.
Although the company is based in Hong Kong and Dotcom lives in New Zealand, some of the alleged pirated content was hosted on leased servers in Virginia, and that was enough for U.S. prosecutors to act.
New Zealand police served 10 search warrants at several businesses and homes around the city of Auckland.
Police spokesman Grant Ogilvie said the seized cars include a Rolls Royce Phantom Drophead Coupe worth more than $400,000 as well as several Mercedes. Two short-barreled shotguns and a number of valuable artworks were also confiscated, he added.
He said police seized more than $8 million, money that was invested in various New Zealand financial institutions and which has now been placed in a trust pending the outcome of the cases.
New Zealand’s Fairfax Media reported that the four defendants stood together in an Auckland courtroom in the first step of the extradition proceedings.
Dotcom’s lawyer raised objections to a media request to take photographs and video, but then Dotcom spoke out from the dock, saying he didn’t mind photos or video “because we have nothing to hide.” The judge granted the media access, and ruled that the four would remain in custody until a second hearing Monday.
Dotcom, Megaupload’s former CEO and current chief innovation officer, is a resident of Hong Kong and New Zealand and a dual citizen of Finland and Germany who had his name legally changed. The 37-year-old was previously known as Kim Schmitz and Kim Tim Jim Vestor.
Two other German citizens and one Dutch citizen also were arrested and three other defendants _ another German, a Slovakian and an Estonian _ remain at large.
Megaupload has retained Washington power attorney Bob Bennett to defend it, according to a person inside the company. Bennett is best known for representing former President Bill Clinton during the Monica Lewinsky scandal. The person within Megaupload spoke on condition of anonymity because he was not authorized to discuss the company’s plans.
The Electronic Frontier Foundation, which defends free speech and digital rights online, said in a statement that the arrests set “a terrifying precedent. If the United States can seize a Dutch citizen in New Zealand over a copyright claim, what is next?”
The indictment was unsealed one day after websites including Wikipedia and Craigslist shut down in protest of two congressional proposals intended to make it easier for authorities to go after sites with pirated material, especially those with overseas headquarters and servers.
Before Megaupload was taken down, the company posted a statement saying allegations that it facilitated massive breaches of copyright laws were “grotesquely overblown.”
“The fact is that the vast majority of Mega’s Internet traffic is legitimate, and we are here to stay. If the content industry would like to take advantage of our popularity, we are happy to enter into a dialogue. We have some good ideas. Please get in touch,” the statement said.
Several sister sites were also shut down, including one dedicated to sharing pornography files.
News of the shutdown seemed to bring retaliation from hackers who claimed credit for attacking the Justice Department’s website. Federal officials confirmed it was down for hours Thursday evening and that the disruption was being “treated as a malicious act payday loans online.”
A loose affiliation of hackers known as “Anonymous” claimed credit for the attack. Also hacked was the site for the Motion Picture Association of America, which has campaigned for a crackdown on piracy.
According to the indictment, Megaupload was estimated at one point to be the 13th most frequently visited website on the Internet. Current estimates by companies that monitor Web traffic place it in the top 100.
Megaupload is considered a “cyberlocker,” in which users can upload and transfer files that are too large to send by email. Such sites can have perfectly legitimate uses. But the Motion Picture Association of America estimated that the vast majority of content being shared on Megaupload was in violation of copyright laws.
The website allowed users to download some content for free, but made money by charging subscriptions to people who wanted access to faster download speeds or extra content. The website also sold advertising.
Megaupload was unique not only because of its massive size and the volume of downloaded content, but also because it had high-profile support from celebrities, musicians and other content producers who are most often the victims of copyright infringement and piracy. Before the website was taken down, it contained endorsements from Kim Kardashian, Alicia Keys and Kanye West, among others.
The company listed Swizz Beatz, a musician who married Keys in 2010, as its CEO. He was not named in the indictment and declined to comment through a representative.
The five-count indictment, which alleges copyright infringement as well as conspiracy to commit money laundering and racketeering, described a site designed specifically to reward users who uploaded pirated content for sharing, and turned a blind eye to requests from copyright holders to remove copyright-protected files.
For instance, users received cash bonuses if they uploaded content popular enough to generate massive numbers of downloads, according to the indictment. Such content was almost always copyright protected, the indictment said.
The Justice Department said it was illegal for anyone to download pirated content, but their investigation focused on the leaders of the company, not end users who may have downloaded a few movies for personal viewing.
A lawyer who represented the company in a lawsuit last year declined to comment Thursday. Efforts to reach an attorney representing Dotcom were unsuccessful.
Although Megaupload is based in Hong Kong, the size of its operation in the southern Chinese city was unclear. The administrative contact listed in its domain registration, Bonnie Lam, did not respond immediately for a request for comment sent to a fax number and email address listed.
The indictment was returned in the Eastern District of Virginia, which claimed jurisdiction in part because some of the alleged pirated materials were hosted on leased servers in Ashburn, Virginia. Prosecutors there have pursued multiple piracy investigations.
The Justice Department also was investigating the “significant increase in activity” that disrupted its website. It said in a statement that it was working to “investigate the origins of this activity, which is being treated as a malicious act until we can fully identify the root cause.”
The site appeared to be working again late Thursday. A spokesman for the Motion Picture Association of America said in an emailed statement that the group’s site also had been hacked, but it too appeared to be working later in the evening.
“The motion picture and television industry has always been a strong supporter of free speech,” the spokesman said. “We strongly condemn any attempts to silence any groups or individuals.”
____
Matthew Barakat reported from McLean, Virginia. AP Business Writer Daniel Wagner in Washington contributed to this report.
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A Qatar-owned company says it has taken over the famous Raffles Hotel Singapore and an affiliated luxury hotel in Paris in the latest high-profile acquisitions by the energy-rich Gulf state.
The Qatar National Hotels Co. said Saturday that it recently took ownership of the 125-year-old Raffles Hotel Singapore and Le Royal Monceau Raffles hotel in Paris.
It did not disclose financial terms in the deal with Toronto-based Fairmont Raffles Hotels International, which had owned both hotels one hour payday loan.
State-owned Qatari companies have been snapping up investments at a brisk pace in recent months, including stakes in European energy companies, Germany’s largest builder Hochtief AG and majority ownership in the French football team Paris Saint-Germain.
American employers stepped up their hiring in December, bringing the unemployment rate down again.
The economy added 200,000 jobs in the month, the Labor Department reported Friday, closing out the year with 1.6 million jobs gained in 2011. Only 940,000 jobs were added the year before.
Meanwhile, the unemployment rate fell to 8.5%, its lowest level since February 2009.
"This is a good solid report, and the big message here is that 2011 was much better than 2010," said Scot Melland, CEO of Dice Holdings, a provider of career websites. "We’re headed in the right direction."
The encouraging news was coupled with revisions to the Labor Department’s data going back five years, which showed the unemployment rate has fallen for four consecutive months.
While private businesses have been adding jobs consistently since March 2010, the government has been slashing payrolls. In December, private employers added 212,000 jobs, and the public sector cut 12,000 jobs.
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The manufacturing, health care and education industries were all bright spots in December, each adding more than 20,000 jobs cheap business cards. Even the construction industry, which had been bleeding jobs the two prior months, hired another 17,000 workers.
Jobs in retail and the food services were also on the rise, as were positions for couriers and messengers. In spite of the Labor Department’s seasonal adjustments, some analysts caution that these positions could be related to holiday hiring.
Still, more than 13 million people remain unemployed in the United States, and 42.5% of them have been so for six months or more.
Overall, the job market has a long way to go to fully recover from the financial crisis. The economy still needs to add about 6 million jobs to get back to 2008 employment levels.
Were you falling out of the middle class even before the Great Recession hit? Are you better or worse off than your parents? Do you have a job but still feel you aren’t upwardly mobile? Email realstories@cnnmoney.com with your name and phone number, and you could be featured in an upcoming story on CNNMoney.
When the temperature went up close to record-breaking levels Thursday, production lines at Italpasta Ltd. in Brampton went down.
But plant manager Riccardo Bordignon wasn
Shares in British Sky Broadcasting PLC are falling for the sixth straight session Tuesday, a day after News Corp.’s bid for the satellite broadcaster was referred to the competition regulator.
With the review likely to take many months, there’s little incentive for short-term investors, such as hedge funds, to keep hold of the stock. BSkyB shares were 2.1 percent lower early Tuesday at 700 pence ($11.07). The decline means that the stock is underperforming in the FTSE 100 index of leading British shares. Shares around the world have been hit Tuesday by mounting fears over the financial health of Spain and Italy.
BSkyB shares have taken a battering over the past week, falling from 850 pence, as a phone-hacking at the Sunday tabloid News of the World escalated.
The paper, which closed Sunday after 168 years, was owned by News Corp.’s British subsidiary News International. News Corp. shares have also taken a pounding, as investors doubt whether it will get the 61 percent of BSkyB it doesn’t already own.
On Monday, News Corp. withdrew its promise to spin off Sky News, which had been a condition for buying the remaining shares in BSkyB, triggering a referral to the Competition Commission from Culture Secretary Jeremy Hunt.
Britain’s Competition Commission now must hold a full-scale inquiry into whether the takeover would break anti-monopoly laws. These inquiries usually take six months and Murdoch must be hoping that the current febrile atmosphere surrounding the bid cools down.
“News Corp. now has a decent time for the crescendo of allegations to peak and be dealt with and relevant actions to be taken, assuming these are containable,” Investec Securities analyst Steve Liechti said.
However, with police apparently still in the early stages of a criminal investigation of the News of the World, Liechti said there is a danger that News Corp. could be forced to reduce its stake in BSkyB if Britain’s communication regulator decides it is not “fit and proper” to control a broadcasting license.
On Tuesday, former Prime Minister Gordon Brown joined the criticism of News International, repeatedly accusing the company of employing criminals to obtain confidential information about his bank account, taxes and other issues.
“If I, with all the protection and all the defenses and all the security that a chancellor of the exchequer or a prime minister, am so vulnerable to unscrupulous tactics, to unlawful tactics, methods that have been used in the way we have found, what about the ordinary citizen?” Brown said in an interview with the BBC.
OTTAWA—The Harper government will bring in back-to-work legislation Monday to end the postal strike and get mail moving again.
Declaring that the two sides have had “ample amount of time” to reach a settlement, Labour Minister Lisa Raitt said she would force an end to the Canada Post labour dispute if necessary.
The government was preparing to introduce the legislation Monday afternoon though it could take several days to become law.
The move sparked an angry reaction from New Democrats who accused the Conservatives of meddling in collective bargaining loan for people with bad credit.
It’s possible NDP MPs could delay a legislated end to the dispute.
Interim Liberal Leader Bob Rae accused the Conservatives of doing little to safeguard defined benefit pensions, one of the issues at the heart of the Canada Post dispute.
The departure of Yemen’s battle-wounded president for treatment in Saudi Arabia set off wild street celebrations Sunday in the capital, where crowds danced, sang and slaughtered cows in hopes that this spelled a victorious end to a more than three-month campaign to push their leader from power.
Behind the festive atmosphere, many feared Ali Abdullah Saleh, a masterful political survivor who has held power for nearly 33 years, will yet return _ or leave the country in ruins if he can’t. Hanging in the balance was a country that even before the latest tumult was beset by deep poverty, malnutrition, tribal conflict and violence by an active al-Qaida franchise with international reach.
Saleh, who was taken overnight to a military hospital in the Saudi capital, Riyadh, underwent successful surgery on his chest to remove jagged pieces of wood that splintered from a mosque pulpit when his compound was hit by rockets on Friday, said medical officials and a Yemeni diplomat. They spoke on condition of anonymity because they did not have permission to release the information.
The stunning rocket attack, which the government first blamed on tribal fighters who in recent weeks turned against the president and later on al-Qaida, killed 11 bodyguards and seriously injured five senior officials worshipping just alongside Saleh.
While Saleh is away, Vice President Abed Rabbo Mansour Hadi is acting as temporary head of state, said the deputy information minister, Abdu al-Janadi. The minister said the president would return to assume his duties after his treatment, though experts on Yemeni affairs questioned whether a return is possible in the face of so much opposition.
“Saleh will come back. Saleh is in good health, and he may give up the authority one day but it has to be in a constitutional way,” al-Janadi said. “Calm has returned. Coups have failed. … We are not in Libya, and Saleh is not calling for civil war.”
His sudden departure raised many questions, including whether his Saudi hosts would bless his return. The Saudis have backed Saleh and cooperated over the years in confronting al-Qaida and other threats, but they are now among those pressing him to give up power as part of a negotiated deal. Saudi Arabia has watched with concern the anti-government protests that have spread to other neighboring countries like Bahrain and is eager to contain the unrest on its doorstep.
The president’s absence raised the specter of an even more violent power struggle between the armed tribesmen who have joined the opposition and loyalist military forces under the command of Saleh’s son and other close relatives. Street battles between the sides have already pushed the political crisis to the brink of civil war.
In an attempt to cool the situation, the vice president offered through mediators to pull government forces back from the neighborhood of the capital where they’ve battled fighters loyal to Sheik Sadeq al-Ahmar, who heads Yemen’s most powerful tribal confederation, the Hashid.
Al-Ahmar said in a statement he agreed to the deal, which requires his forces to leave the streets and government ministries they seized starting Monday.
In the streets of the capital, Sanaa, joyful crowds celebrated what they hoped would be Saleh’s permanent exit.
Crowds danced, sang and slaughtered a few cows in what demonstrators have dubbed Change Square, the epicenter of the nationwide protest movement since mid-February calling for Saleh to step down immediately. Some uniformed soldiers joined those dancing and singing patriotic songs and were hoisted on the shoulders of the crowd. Many in the jubilant crowd waved Yemeni flags, joyfully whistling and flashing the “V” for victory signs.
“Who would have believed that this people could have removed the tyrant?” said 30-year-old teacher Moufid al-Mutairi.
Women in black veils joined demonstrators carrying banners that hailed Saleh’s departure low interest personal loan. One read: “The oppressor is gone, but the people stay.”
But there were also fears that the president would attempt a comeback or try to transfer power to his son Ahmed, who heads the Republican Guard and remains in Yemen. Some worried Saleh and his allies could even try to leave the country in ruins if they feel there is no way to stay in power.
“Saleh is never true to his word,” said al-Mutairi, the teacher. “If the medical reports are true that his wounds are light, then he will for sure return. Our challenge now is to remove the rest of the regime.”
“If he returns, it will be a disaster.”
Yemen’s unrest began as a peaceful protest movement that the government at times used brutal force to try to suppress, killing at least 166 people, according to Human Rights Watch. It transformed in the past two weeks into armed conflict after the president’s forces attacked the home of a key tribal leader and one-time ally who threw his support behind the uprising. The fighting turned the streets of the capital into a war zone.
Other forces aligned against Saleh at the same time. There were high-level defections within his military, and Islamist fighters took over at least one town in the south in the past two weeks.
In Taiz, Yemen’s second-largest city, dozens of gunmen attacked the presidential palace on Sunday, killing four soldiers in an attempt to storm the compound, according to military officials and witnesses. They said one of the attackers was also killed in the violence. The attackers belong to a group set up recently to avenge the killing of anti-regime protesters at the hands of Saleh’s security forces.
Elsewhere in the south, gunman ambushed a military convoy, killing nine soldiers, officials said. They spoke on condition of anonymity because they were not authorized to talk to the media.
Saleh has been under intense pressure to step down from his powerful Gulf neighbors, who control a large share of the world’s oil resources, and from longtime ally Washington. They all fear Yemen could be headed toward a failed state that will become a fertile ground for al-Qaida’s most active franchise to operate and launch attacks abroad.
In a display of the kind of political maneuvering that has helped keep Saleh in power through numerous perils, he agreed three times to a U.S.-backed Gulf Arab proposal for ending the crisis only to back out at the last minute.
Now, Saleh’s injuries and his treatment abroad provide him with what could turn out to be a face-saving solution to exit power.
“This is exactly what needed to happen,” said Christopher Boucek, a Yemen expert with the Carnegie Endowment for International Peace. “He needed to leave in order to get past this political deadlock that has been cursing Yemen for the past few months.”
Rick Nelson, a counterterrorism expert at the Center for Strategic and International Studies in Washington, said there is no chance of Saleh returning to Yemen and it’s unlikely anyone linked to him can maintain power and control.
“I can’t see any remnant of the saleh government staying in place after this,” Nelson said.
The fact that powerful members of Saleh’s family have remained behind in Sanaa suggests vigorous attempts to hold power will be made.
Significantly, military officials said Hadi, the vice president, met late Saturday night in Sanaa with several members of Saleh’s family, including his son and one-time heir apparent Ahmed, who commands the powerful Republican Guard. Others who attended the meeting included two of the president’s nephews and two half brothers. All four head well-equipped and highly trained units that constitute the president’s main power base in the military.
Even cities that weathered the housing market crash with relatively little damage are suffering now.
Severe price declines have spread to Dallas, Denver, Minneapolis and Cleveland, which had mostly withstood the bust in housing since 2006. The damage has now gone well beyond cities hit hardest by unemployment and foreclosures, such as Phoenix and Las Vegas.
“We didn’t enjoy the highs and the lows like other cities,” said Kay Weeks, a Realtor with Ebby Halliday in Dallas, where prices fell nearly 1 percent in March and are expected to keep falling. “But when we get bad news nationally, people take notice and cut back on spending and buying homes.”
Home prices in big metro areas have sunk to their lowest since 2002, the Standard & Poor’s/Case-Shiller 20-city monthly index showed Tuesday. Since the bubble burst in 2006, prices have fallen more than they did during the Great Depression.
The index, which covers metro areas that include about 70 percent of U.S. households, is updated every quarter and provides a three-month average. The March data is the latest available.
Foreclosures have forced prices down so much that some middle-class neighborhoods have turned into lower-income areas within months.
Prices are expected to keep falling until the glut of foreclosures for sale is reduced, companies start hiring in greater force, banks ease lending rules and more people think it makes sense again to buy a house. In some markets, that could take years.
The latest report points to a “double dip in home prices across much of the nation,” said David Blitzer, chairman of the Index Committee at Standard & Poor’s.
Prices fell from February to March in 18 of the metro areas tracked by the Standard & Poor’s/Case-Shiller index. And prices in a dozen markets have reached their lowest points since the housing bubble burst in late 2006.
The overall index fell for the eighth straight month and has dropped 3.6 percent in the past year. Prices had risen last summer, fueled by a temporary federal homebuying tax credit. But they’ve tumbled 7 percent since then. After adjusting for inflation, the home-price index has sunk to the level of 1999.
Cities with high foreclosures such as Phoenix, Las Vegas and Tampa, Fla., are flooded with homes sitting vacant, awaiting buyers. Many banks have agreed to allow homes at risk of foreclosure to be sold for less than what is owed on their mortgages. That has pulled down prices.
In Phoenix, for example, home prices rose about 5 to 6 percent annually in the pre-boom years before exploding nearly 23 percent in 2004. The next year, in 2005, they skyrocketed nearly 43 percent. Prices there soon leveled off before plunging in 2007 and 2008. They’re now back to 2000 levels.
Coastal areas, such as San Francisco, San Diego, Los Angeles, Washington and Boston, have fared comparatively better in the past two years. They have been helped by healthy local economies, desirable city centers and limited space for new housing. In New York, homes are still 63 percent more expensive than in 2000.
In the middle are cities like Dallas, Denver, Minneapolis and Cleveland, which are seen as bellwethers for the national housing market.
Before the housing boom, prices in Minneapolis rose 7 percent or more a year. Then they stalled in 2006, fell in 2007 and 2008, and rose modestly in 2009. Last year, prices started falling again and haven’t stopped.
Over the past decade, Dallas has grown faster than any other metro area. Among companies that have moved their headquarters there are Comerica Inc. and AT&T. Construction surged to meet the demand.
But since the housing bubble burst, foreclosures have risen. Many homes have been sold at steep discounts. Dallas-area foreclosures bought at auction in March sold for just 57 percent of their appraised value, according to Foreclosure Listing Service.
Denver had also avoided the peaks and valleys of the bubble and bust pay day loans. It enjoys a diversified local economy that has expanded to include the telecommunications, wind-energy and space-technology industries.
Foreclosures haven’t flooded the Denver market. But many of Denver’s potential buyers, most of whom would otherwise be first-timers, are opting to rent instead.
“When they’re doing the calculations to rent versus buy, they’re choosing to rent,” said Gary Bauer, a broker in Littleton, Colo., outside Denver. “It’s simple math, and for many people, it’s too expensive to own.”
As a result, falling prices have turned once-costly, newer subdivisions, including those in Aurora and Commerce City, into largely vacant neighborhoods.
“The closer to the mountains you are here, the pricier it is, so people built a lot of new, big homes during the housing boom,” said Yve Roberts, a Denver real estate agent. “They thought that’s where the next wave of houses would be. But many of the young people that bought there can’t afford it anymore.”
In the next two months, prices in Dallas and Denver are expected to reach their lowest since the housing downturn began.
In 12 other cities, prices are already at the lowest point since the end of the boom: Atlanta, Charlotte, Chicago, Cleveland, Detroit, Las Vegas, Miami, Minneapolis, New York, Phoenix, Portland, Ore., and Tampa, Fla.
Minneapolis fared the worst in March, with prices down 3.7 percent. They dropped 2.4 percent in Charlotte and Chicago and 2 percent in Detroit. Prices rose 0.1 percent in Seattle and 1.1 percent in Washington. The nation’s capital is the only metro area in the index where prices have risen in the past year.
One obstacle to a rebound in prices: A delay in processing foreclosures. Homes in foreclosure sell at a 20 percent discount on average, which can hurt prices in the neighborhood. But many foreclosure sales have been delayed while federal regulators, state attorneys general and banks review how those foreclosures were carried out over the past two years.
Once those homes are eventually foreclosed upon, they will cause prices to fall even further. Those declines are “etched in stone,” said Patrick Newport, U.S. economist at IHS Global Insight.
Falling home prices led Neil Isakson of Amery, Wis., about an hour and a half from Minneapolis, to pull his four-bedroom lakefront house off the market this spring after it went unsold for nearly two years.
Isakson chose to rent out the home rather than reduce the price further. He had listed it in June 2009 for $359,000. Last summer, he cut it to $339,000. Yet fewer than a dozen people showed up to look at the house. He’s holding out for the market to recover.
“I’m willing to wait two to three years,” Isakson said.
Home equity accounts for most of the wealth of typical households. So when prices fall, they have “important spillover effects on other sectors of the economy,” said Yelena Shulyatyeva, an analyst at BNP Paribas. Those sectors include consumer spending and state and local property tax collections. Consumer spending fuels about 70 percent of the overall economy.
“Folks are having so much difficulty in getting financing for a home,” said Mark Vitner, senior economist at Wells Fargo. “And foreclosures will likely bring about a third dip. It may be early next year before prices hit bottom.”
That won’t change soon. Roughly 92 percent of homeowners say it’s a bad time to sell their home, according to the latest Thomson Reuters/University of Michigan index of consumer sentiment.
In the seven years before its peak in July 2006, the home-price index surged 155 percent. Since then, it’s fallen 33 percent.
During the Great Depression, prices fell 31 percent. It took 19 years for the housing market to regain its losses after the Depression ended.
Air Canada
Earlier this month, Bell and Quebecor, two giants in the Canadian broadcasting and telecom landscape, became embroiled in a dispute over Sun News Network, the recently launched all-news television station.
At first glance, the dispute appeared to be little more than a typical commercial fight over how much Bell should pay to Quebecor to carry the Sun News Network channel on its satellite television package. When the parties were unable to reach agreement, Bell removed Sun News, leaving a placeholder message indicating
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