News of the alleged terrorist plot involving liquid explosives on airplanes spans the three continents of North America, Europe, and South Asia. This issue of the Newsletter describes the plot (GTM), the political fallout (PRM), the economic impact (ETM/Economy), the financing (AML), the purported weapons (ETM/Weapons), and the reaction in the transportation sector (CIM). In addition to this and other news highlights from the past week around the world, Recommend Reading focuses on recent books and reports related to fraud.

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3. AML/CFT Monitor

The AML/CFT Monitor is a monthly 16-page print publication. News highlights from the past week are provided in this free email update, but detailed analysis, background information and source documents are only available to subscribers. Purchase a subscription at our online store:
TAMNI Publications

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AML/CFT Incidents/Cases
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More than 140 soldiers in an anti-guerilla battalion have been found guilty by a Colombian military tribunal of stealing money from the Revolutionary Armed Forces of Colombia (FARC), which finances its terrorist campaign largely from drug trafficking, kidnapping for ransom, and extortion. Instead of reporting $16 million found during a 2003 operation, they split it. Individual sentencing will proceed, with sentences involving between six and 15 years in prison. About half those convicted remain at large. Sentences will be appealed.
http://news.bbc.co.uk/2/hi/americas/4779153.stm
http://www.washingtonpost.com/wp-dyn/content/article/2006/08/11/AR2006081102093.html

Nigeria's Economic and Financial Crimes Commission (EFCC) arrested a terrorism suspect claiming to represent "Terrorist International" as he and 13 others were caught engaged in fraudulent activities at a cyber cafe.
http://www.efccnigeria.org/index.php?option=com_content&task=view&id=982

The UK Financial Services Authority (FSA) has fined Merrill Lynch International GBP150,000 for failing to accurately report certain transactions to the FSA and previously to the Securities and Futures Authority. The transactions incorrectly showed Merrill as an agent rather than principal of some 1.2 million transactions in non-UK European equities.
http://www.fsa.gov.uk/pages/Library/Communication/PR/2006/078.shtml

US Attorney for the northern district of California Kevin Ryan released a 40-count indictment against Chuka Ogele, his wife Jeri Ogele, and Texan Frederick Lamar Lindsey. They are charged with money laundering in connection with black market distribution of more than $2 million in codeine and other painkillers.
http://www.usdoj.gov/usao/can/press/2006/2006_08_04_ogele_indictment.press.htm
http://www.usdoj.gov/usao/can/press/press_documents/ogele indictment.pdf

Osama Abulhassan and Ali Houssaiky, from the US state of Michigan, were arrested in the neighboring state of Ohio. When stopped for a traffic violation, the two men were found to have $11,000 cash, 12 mobile phones, airline passenger lists, information on airport security. They have admitted purchasing and reselling hundreds of phones, and carried maps of Walmart store locations, where they had been purchasing the phones, often without chargers. They face two felony charges of soliciting or providing material support for terrorism and obtaining information of a vulnerable target for the purpose of terrorism. The two college students say they were merely trying to earn money over the summer, and deny connections to Hezbollah or any other terrorist organization.
http://toledoblade.com/apps/pbcs.dll/article?AID=/20060812/NEWS03/60812010
http://www.freep.com/apps/pbcs.dll/article?AID=/20060811/NEWS05/608110324
http://www.mariettatimes.com/news/story/new11_811200683259.asp
http://www.mariettatimes.com/news/story/new33_812200625958.asp

Venezuelan authorities last week detained suspected Colombian drug trafficker and paramilitary Libardo de Jesus Parra Gonzalez, who has now been deported to Colombia. He is wanted in Colombia and the US for drug trafficking, kidnapping, and extortion. This week Venezuelan authorities arrested Elias Verde, suspected of leading a Venezuelan-European cocaine ring.
http://www.venezuelanalysis.com/news.php?newsno=2037
http://www.vheadline.com/readnews.asp?id=65612

Zimbabwe's Operation Sunrise is directed against people laundering old cash before the new currency is introduced on 21 August. Authorities have identified several thousand cases of suspected money laundering and have seized more than $50 million worth of old notes.
http://www.herald.co.zw/inside.aspx?sectid=7226&cat=1
http://allafrica.com/stories/200608071411.html
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AML/CFT Legislation and Regulation
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The UN Security Council's Al Qaeda and Taleban Sanctions Committee has added one individual in the al Qaeda section of the Consolidated List and approved changes regarding 25 individuals.
http://www.un.org/News/Press/docs/2006/sc8798.doc.htm

Bay of Bengal Initiative for Multi-Sector Technical and Economic Cooperation (BIMSTEC) members Bangladesh, Bhutan, Burma, India, Nepal, Sri Lanka and Thailand, have agreed to share information and law enforcement to combat terrorism financing, drug trafficking, and other transnational crimes. A working group will meet in December to iron out further details.
http://pib.nic.in/release/release.asp?relid=19702
http://www.bimstec.org/

India is making the verification of a tax identification Permanent Account Number (PAN) mandatory for large cash payments and high value transactions.
http://incometaxindia.gov.in/PAN/Overview.asp
http://incometaxindia.gov.in/FileYourReturn/PAN.asp
http://www.nsdl.co.in/downloadables/news03Mar06.doc.

Italian authorities in the historic town of Padua have constructed a steel barrier around a housing estate to control violence connected to drug dealing.
http://www.agi.it/english/news.pl?doc=200608091809-1190-RT1-CRO-0-NF51&page=0&id=agionline-eng.arab

Nigeria's Economic and Financial Crimes Commission (EFCC) plans to publish names of past and present leaders responsible for looting the national treasury of more than $400 billion.
http://www.thisdayonline.com/nview.php?id=55475
http://www.efccnigeria.org/

EFCC chairman Mallam Nuhu Ribadu offered case studies from Nigeria in a lecture on "Combating Money Laundering in Emerging Economies".
http://www.vanguardngr.com/articles/2002/nationalx/nr111082006.html

The Monetary Authority of Singapore (MAS) has invited comment on AML/CFT notices related to Customer Due Diligence measures and FATF's Special Recommendation on cross-border wire transfers.
http://www.mas.gov.sg/masmcm/bin/pt1MAS_Invites_Comments_on_AMLCFT_Notices.htm

The Financial Action Task Force (FATF) has invited South Korea to join as an observer, which is the first step towards full membership, in about two years.
http://www.fatf-gafi.org

The Bank of England, as agent for HM Treasury directed that a freeze be imposed on any funds held for or on behalf of Abdula Ahmed Ali, Cossor Ali, Shazad Khuram Ali, Nabeel Hussain, Tanvir Hussain, Umair Hussain, Umar Islam, Waseem Kayani, Assan Abdullah Khan, Waheed Arafat Khan, Osman Adam Khatib, Abdul Muneem Patel, Tayib Rauf, Muhammed Usman Saddique, Assad Sarwar, Ibrahim Savant, Amin Asmin Tariq, Shamin Mohammed Uddin, and Waheed Zaman. The 19 men are among those suspected of planning to use liquid explosives to blow up planes between the UK and US. The asset freeze was announced unusually quickly, following announcement of the allegedly disrupted plot, reflecting lengthy preparation and monitoring on the part of British authorities.
http://www.bankofengland.co.uk/publications/news/2006/082.htm

Bank of England also advised that the UN Sanctions Committee added Al-Mujil, Abd Al Hamid, Sulaiman and International Islamic Relief Organization (Philippines Branch Offices) to the UN Consolidated List maintained under Resolution 1390 (2002), thereby falling within the UK financial sanctions regime
http://www.bankofengland.co.uk/publications/news/2006/081.htm

In the UK, HM Revenue and Customs has released a consultation document setting out powers and safeguards to modernize criminal investigations, including tax fraud and other crimes that can involve organized crime.
http://customs.hmrc.gov.uk/channelsPortalWebApp/downloadFile?contentID=HMCE_PROD1_025789

US Department of Treasury Assistant Secretary for Terrorist Financing Pat O'Brien gave these remarks on the President's new initiative to stop kleptocrats from transferring ill-gotten gains.
http://www.treas.gov/press/releases/hp55.htm

Yemen has enacted the International Anti-Money Laundering and Funding of Terrorism Act.
http://www.yobserver.com/news_10678.php

Zambia has arrested a female Zambian banker, two Tanzanians, two South Africans, and a Ugandan (who laundered $45,000 into motor vehicles) for money laundering, drug trafficking, and smuggling.
http://english.people.com.cn/200608/12/eng20060812_292406.html
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AML/CFT Modalities
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Colombian traffickers use of Ghana as a transit point, and related warning signs, are discussed in this article:
http://allafrica.com/stories/200608110594.html

Pakistan's Daily Times newspaper reports on the use of earthquake relief funds to finance the alleged UK bombing plot.
http://www.dailytimes.com.pk/default.asp?page=2006\08\12\story_12-8-2006_pg1_1

Guardian reporter Bobbie Johnson describes "Why internet crime has grown more lucrative than the drug trade"
http://business.guardian.co.uk/story/0,,1841855,00.html

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4. Emerging Threat Monitor

For detailed analysis, background information and source documents consider subscribing. Subscriptions to Emerging Threat Monitor can be purchased at our online store:
TAMNI Publications

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ETM Corruption and Transnational Crime
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The World Bank has launched a Voluntary Disclosure Program (VDP), a proactive anti-corruption investigation tool. VDP allows entities that engaged in past fraud and corruption to disclose all wrongdoing and thereby avoid administrative sanctions.
http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:21011609~pagePK:34370~piPK:34424~theSitePK:4607,00.html

The Australian Securities and Investments Commission (ASIC) charged Dominic Fodera, former Chief Financial Officer of HIH Insurance Ltd (HIH) with six criminal charges related providing false or misleading information that contributed to the 2001 collapse of HIH.
http://www.asic.gov.au/asic/asic_pub.nsf/byheadline/06-272+HIH+CFO+committed+to+stand+trial?openDocument

Brazil's Parliamentary Commission of Inquiry (CPI) completed an investigation into a huge corruption ring in which 69 deputies and three senators have been implicated. The panel calls for the 72 men, about ten percent of the sitting members of Congress, to be expelled for taking bribes.
http://www.senado.gov.br/agencia/verNoticia.aspx?codNoticia=57973&codAplicativo=2 (in Portuguese)
http://www.senado.gov.br/jornal/noticia.asp?codNoticia=49216&dataEdicaoVer=20060811&dataEdicaoAtual=20060811&codEditoria=23&nomeEditoria=CPIs (in Portuguese)

Cameroon conducted a census of public employees and discovered they have been paying salaries to 45,000 ghost workers, who do not actually exist.
http://za.today.reuters.com/news/NewsArticle.aspx?type=topNews&storyID=2006-08-11T120657Z_01_BAN143593_RTRIDST_0_OZATP-CAMEROON-GRAFT-20060811.XML

Allegations that former foreign minister Natwar Singh was involved in corrupt practices connected with Iraq's oil-for-food program have led to his suspension from the ruling Congress Party. Singh presented a written submission to parliament in which he condemned Congress Party leader Sonia Gandhi as leading India to become a slave to US foreign policy.
http://news.bbc.co.uk/2/hi/south_asia/4784435.stm
http://www.indianexpress.com/story/10359.html

US Republican congressman from the state of Ohio Bob Ney will not run for re-election this year. During his 12 years in office he was closely connected to disgraced lobbyist Jack Abramoff, and his departure is attributed to the impact of this corrupt relationship, although Ney attributes his decision to family reasons.

The Securities and Exchange Commission (SEC) filed civil charges against three former senior executives of Comverse Technology for fraudulent stock option manipulation using backdating.
http://www.sec.gov/news/press/2006/2006-137.htm

Former WalMart vice chairman Tom Coughlin has been sentenced to 27 months home confinement, and $450,000 in fines and restitution, for stealing thousands from his employer.
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ETM Economies and Financial Systems
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Global markets appear to have shrugged off the alleged terrorist plot uncovered in the UK this week. Observers suggest that since 9/11 the terrorist threat has been factored-in, and the industry has learned to live with the threat. Only marginal, short-term falls in traffic are anticipated. Airline stocks fell somewhat, but much of the drop is attributed to fear of rising oil prices.

Standard and Poor's analysis "Conflict in the Mideast: Four Oil Supply Scenarios" considers the impact of a major oil supply disruption on US and global economies. They consider four scenarios:
* The conflict is contained. The current fighting subsides without spreading to Syria or Iran. Oil prices subside to $70/barrel by year-end
* Iran shuts its taps. The conflict spreads to Iran, perhaps because of air strikes by Israel of the US on nuclear or other facilities. Iran stops exporting oil. However, the Strait of Hormuz through which most Persian Gulf oil flows, remains open, and Arab states continue to export.
* The Gulf goes dry. As in the second scenario, except that Iran partially closes the Strait of Hormuz. Most Persian Gulf oil shipments are shut down for a period of six months before the vital shipping lane reopens.
* The US gets cut off. The Persian Gulf countries join in a selective embargo of the US, refusing to export oil to the world's biggest energy consumer but continuing to supply it at similar volume to Asia, Europe, and other oil-importing regions. Venezuela cooperates with the Arab embargo.
http://www.standardandpoors.com/

The Confederation of Indian Industry (CII) reports that India must spend eight percent of gross domestic product on new infrastructure over the next five years or shortages of roads, ports, and power stations will slow economic growth.
http://www.ciionline.org/news/newsMain.asp?news_id=87200692058AM

Hot dry weather and over-fishing (which removed predators) are blamed for huge swarms of jellyfish in the Mediterranean that have forced some beaches to close, and stung at least 30,000 people so far this summer. In some areas of the Spanish coast there are as many as 10 jellyfish per square meter.
http://europe.oceana.org/index.php?id=1578

Zimbabwe has frozen prices for three weeks to prevent price increases while the new dollar (with three zeros less) launches. After 21 August old notes will no longer be legal tender.
http://www.herald.co.zw/inside.aspx?sectid=7219&cat=1
The "upside-down" economy is discussed here:
http://www.irinnews.org/report.asp?ReportID=55091
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ETM Environment and Climate Change
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UN experts are n Syria beginning assessment of the oil spill caused by Israel's bombing of a power plant. The oil slick has already polluted more than 140 km of coastline and is spreading steadily as the continued conflict makes containment or clean-up efforts impossible.
http://www.moe.lb
http://www.unep.org/Documents.Multilingual/Default.asp?DocumentID=484&ArticleID=5328&l=en

The UK Commons Environmental Audit Committee released its ninth report on Carbon Emissions from Transport. Among its recommendations are taxes for high-fuel consumption cars and air travel, and reduced or strictly enforced speed limits.
http://www.publications.parliament.uk/pa/cm200506/cmselect/cmenvaud/981/98102.htm
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ETM Human Rights
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The US state of Oklahoma is the only one using a 2-line, 2-arm method of lethal injection. This method of execution is being challenged in federal court, as physicians contend this method is fatally flawed and shows a fundamental misunderstanding of how the three drugs involved in lethal injection act.
http://www.latimes.com/news/nationworld/nation/la-na-lethal8aug08,0,2742553.story

The Council of Europe's anti-torture committee published two reports on the UK. They warn that foreign terror suspects held in maximum security prisons indefinitely face serious mental disorders that present a danger of mass suicides.
http://www.cpt.coe.int/en/states/gbr.htm

Former Australian test cricket player Dean Jones was dismissed from his job as a television cricket commentator following the comment "the terrorist has got another wicket". He was referring to South African Muslim batsman Hashim Amia, who wears a beard for religious reasons. An official complaint against the veteran broadcaster was also laid at the International Cricket Council (ICC). Both Jones and the television station have apologized.
http://www.cricket.co.za/default.asp?aId=187121&sportCategory=csa/sateam
http://www.cricket.co.za/default.asp?aId=187186&sportCategory=csa
http://www.theage.com.au/news/cricket/jones-terrorist-slur-hits-home/2006/08/09/1154802960663.html
http://www.int.iol.co.za/index.php?set_id=6&click_id=17&art_id=vn20060808054850951C827876
http://www.int.iol.co.za/index.php?click_id=4&art_id=qw1154968921823S163&set_id=

Ghana has signed a law supporting the disabled that was first drafted 13 years ago into law, and has begun to implement its provisions, which will be rolled out in stages over the next ten years.
http://www.irinnews.org/report.asp?ReportID=55018

The UK Commons Foreign Affairs Committee has criticized internet firms for collaborating with China's censorship of the web. Similar findings come from Human Rights Watch.
http://www.publications.parliament.uk/pa/cm200506/cmselect/cmfaff/860/86008.htm#a43
http://www.hrw.org/english/docs/2006/08/09/china13940.htm
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ETM Infectious Diseases
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Indonesia's 56th human H5N1 avian influenza infection has been confirmed. Of these, 44 have been fatal. Indonesia now has the world's highest human toll from the virus. Cumulative cases through 9 August number 236, of which 138 have proven fatal. Thailand is taking urgent measures to control an outbreak among birds to stop its spread to humans.
http://www.who.int/csr/don/2006_08_09/en/index.html
http://www.who.int/csr/disease/avian_influenza/country/cases_table_2006_08_09/en/index.html

China has confirmed that at least one fatal H5N1 avian influenza case emerged in 2003.
http://www.who.int/csr/don/2006_08_08/en/index.html
http://www.smh.com.au/news/world/bird-flu-case-emerged-in-2003-china-admits/2006/08/08/1154802890487.html
http://content.nejm.org/cgi/content/full/354/25/2731

The 16th International AIDS conference opens in Toronto today. Watch next week for thorough coverage in this Newsletter.
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ETM Legal Systems
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Hong Kong's Legislative Council has passed the Interception of Communications and Surveillance Bill. The controversial law permits surveillance operations approved by judges appointed by Hong Kong's chief executive. Pro-democracy legislators walked out of the debate warning that there was insufficient oversight and no protection against abuse of political opponents. Earlier laws were found unconstitutional.
http://www.news.gov.hk/en/category/lawandorder/060806/html/060806en08002.htm
http://iht.com/articles/2006/08/06/news/hong.php
http://www.thestandard.com.hk/news_detail.asp?pp_cat=11&art_id=24565&sid=9211518&con_type=1

Fast track justice introduced in the northern Indian state of Bihar is described in this article:
http://news.bbc.co.uk/2/hi/south_asia/4775905.stm
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ETM Natural Resources
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Striking workers at the world's largest copper mine, the Escondida mine in Chile, have after five days agreed to resume talks with management. With copper prices skyrocketing, the workers rejected an offer of a 3 percent pay raise and $16,000 bonus, and have demanded a 13 percent increase and $29,400 bonus. Escondida produced eight percent of the world's copper and production has dropped by two-thirds.
http://today.reuters.com/news/articlenews.aspx?type=businessNews&storyID=2006-08-13T001959Z_01_N12203079_RTRUKOC_0_US-MINERALS-CHILE-ESCONDIDA.xml

Yemen's Minister of Oil and Minerals, Khalid Bahah, says corruption is a kind of disease and there is no place for it anymore. The government will offer support, but people can no longer leverage tribal ties or influence of power.
http://www.yobserver.com/printer_10687.php
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ETM Populations
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"Observation of China's urban development issues" finds that China will have 125 mega-cities by 2010.
http://english.people.com.cn/200608/07/eng20060807_290573.html

The International Day of the World's Indigenous People was marked on 9 August.
http://www.un.org/News/Press/docs/2006/sgsm10583.doc.htm

The Huntington Library in the US state of California has launched the Early California Population Project. It provides a database, available online, that records baptisms, marriages and deaths of indigenous Americans in the Spanish missions of the 18th and 19th centuries.
http://www.huntington.org/Information/ECPPmain.htm
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ETM Social Responsibility
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The Center for Global Development's Commitment to Development Index shows that Netherlands is the rich country that does the most to help the developing word. Japan is ranked last, and the US was the smallest in relation to the size of the economy.
http://www.cgdev.org/section/initiatives/_active/cdi
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ETM Technology
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British researchers writing in Cell describe " Clonal Origin and Evolution of a Transmissible Cancer". They have identified a cancer in dogs - Sticker's sarcoma - that is infectious, and may provide lessons for transmission of human cancers.
http://www.cell.com/content/article/abstract?uid=PIIS0092867406009123

US scientists have developed a test to predict which early-stage lung cancer patients will benefit from chemotherapy.
http://content.nejm.org/cgi/content/short/355/6/570

University of Washington researchers have demonstrated that cobalt green - a zinc oxide and cobalt mixture first formulated as a pigment in 1780 - can be used to manipulate magnetic properties of electrons (spintronics) at room temperature, rather than being supercooled. This material may lead to faster, more energy efficient computers.
http://uwnews.washington.edu/ni/article.asp?articleID=25984
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ETM Weapons (WMD, Proliferation)
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The International Crisis Group asks, "After North Korea's Missile Launch: Are the Nuclear Talks Dead?" The briefing says:
"In the wake of Pyongyang's provocative missile test and Washington's hardline negotiating strategy, the six-party talks on North Korea's nuclear program have been reduced to 'dead man walking' status. Unless they can be resumed quickly with both sides showing more flexibility, the U.S. and North Korea could be on a collision course with Seoul caught in the middle. A new approach is needed in Washington, including readiness to talk bilaterally and less name calling, to test the North's willingness to return to the table and work towards a deal. Otherwise the North could be pushed to further escalating an already perilous situation.
http://www.crisisgroup.org/home/index.cfm?l=1&id=4332

Iran appears likely to reject proposals to control its nuclear program. Meanwhile, there are reports that Iran is planning to import uranium from Africa.
http://www.guardian.co.uk/iran/story/0,,1842998,00.html
http://www.iran-press-service.com/ips/articles-2006/august2006/iran_nuclear_12806.shtml
http://www.timesonline.co.uk/article/0,,2089-2300772,00.html

The Institute for Science and International Security (ISIS) is defending its report on the Khushab site in Pakistan.
http://www.isis-online.org/publications/southasia/khushabdiscussion.pdf
http://news.bbc.co.uk/2/hi/south_asia/5251936.stm

Note Steve Coll's "The Atomic Emporium: Iran and the A. Q. Khan network" in the 7-14 August issue of The New Yorker.
http://www.newyorker.com/online/content/?060807on_onlineonly (interview)
And the Carnegie Endowment's George Perkovich's comment on Coll's article:
http://www.carnegieendowment.org/publications/index.cfm?fa=view&id=18609&prog=zgp&proj=znpp

AOAC International has developed a standard collection procedure for visible powders suspected of being biological threat agents.
http://www.aoac.org/ILM/july_aug_06/suspicious_powders.htm

Yale School of Medicine researchers report that Iranian civilians exposed to high intensity warfare and chemical weapons are experiencing heightened psychological distress compared to those with lesser exposures.
http://www.yale.edu/opa/newsr/06-08-02-02.all.html

Details emerging from the alleged terrorist plot foiled in the UK this week closely resemble an earlier effort by Ramzi Yousef, who is now serving a life sentence in the US for the 1993 World Trade Center bombing. This plot involved smuggling nitroglycerine disguised as contact lens solution onto a dozen US airliners crossing the Pacific. A failed test run in Manila uncovered the plot.
http://www.philstar.com/philstar/NEWS200608120414.htm

There are several alternative ways to use liquid explosives, including mixing together two otherwise noncombustible materials:
http://news.bbc.co.uk/2/hi/science/nature/4780391.stm
http://www.guardian.co.uk/terrorism/story/0,,1841679,00.html
http://www.latimes.com/news/nationworld/world/la-sci-explosives11aug11,0,5390443.story?coll=la-home-headlines
http://ottsun.canoe.ca/News/National/2006/08/11/1743945-sun.html
http://www.thestar.com/NASApp/cs/ContentServer?pagename=thestar/Layout/Article_Type1&c=Article&cid=1155246610973
http://www.timesonline.co.uk/article/0,,2-2306994,00.html

Guinea has established the National Authority required under the Chemical Weapons Convention.
http://www.opcw.org/pressreleases/2006/PR47_2006.html

Burma's Chin National Front rebels have committed to adhere to the 1997 Ottawa Convention that outlaws anti-personnel landmines. Geneva Call hopes to get other opposition groups to follow their example.
http://www.genevacall.org/news/testi-press-releases/gc-10aug06-burma.htm

Kal Nelson Aviation Inc has paid a $1 million criminal penalty in California for attempting to export US missile and fighter jet components overseas in violation of the Arms Export Control Act.
http://www.ice.gov/pi/news/newsreleases/articles/060811sandiego.htm

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5. Critical Infrastructure Monitor

Critical Infrastructure Monitor gives you the background and analysis missing from these news briefings. Subscriptions can be purchased from our online store:
TAMNI Publications

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CIM Agriculture and Food
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Hostilities between Israel and Hezbollah have badly affected Lebanese agricultural production, with losses in the tens of millions of dollars, and as much as 80 percent of poultry died for want of feed during the blockade, which has also halted other necessary supplies. Related facilities have been destroyed, including the main milk factory, and there is no electricity. Israeli bombs killed 33 farm workers in the Beqaa valley on 4 August.
http://www.irinnews.org/report.asp?ReportID=55002
http://english.aljazeera.net/NR/exeres/B67C13FC-A3AD-49C3-9B68-0C7768AF88DB.htm

India's Center for Science and Environment issued a major study that finds seriously elevated pesticide levels in Coca Cola and Pepsi soft drinks. As a result, the state of Kerala has become the first to ban their production and sale. Lesser controls are in place in other areas. The Indian Soft Drink Manufacturers Association, to which both companies belong, deny and problems with their products.
http://www.cseindia.org/misc/cola-indepth/cola2006/cola-index.htm
http://www.iht.com/articles/2006/08/07/business/soda.php

The Cocoa Pod Borer moth has destroyed three-quarters of Malaysia's cocoa crop. It is also causing serious problems in Indonesia, Papua New Guinea, and elsewhere in Asia, which produces about 17 percent of the world's cocoa.
http://www.theaustralian.news.com.au/story/0,20867,20049904-36375,00.html
http://www.thenational.com.pg/071206/nation4.htm

Researchers at the International Rice Research Institute in the Philippines and at the University of California Davis have identified a gene that enables rice to survive complete submersion, presenting opportunities to develop new flood-resistant varieties of rice, and offer relief to millions of poor farmers. Rice is the primary food for more than three billion people worldwide.
http://www.news.ucdavis.edu/search/news_detail.lasso?id=7833
http://www.irri.org/
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CIM Banking and Finance
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The Bank for International Settlements (BIS) released "The Banking System in Emerging Economies: How Much Progress Has Been Made?" The paper examines trends in bank credit, the pace of structural change, evolution and management of risks, preventing systematic banking crises, and implications for monetary policy of financial intermediation.
http://www.bis.org/publ/bppdf/bispap28.htm

Banks around the world are beginning to ban mobile phones on the premises, to ensure they be used to support robberies.
http://www.chicagotribune.com/business/chi-0608030166aug03,1,4196288.story?coll=chi-business-hed
http://www.theherald.co.za/herald/news/n13_03082006.htm

The US Securities and Exchange Commission (SEC) has issued additional relief for small companies challenged to meet Section 404 reporting requirements of Sarbanes-Oxley.
http://www.sec.gov/news/press/2006/2006-136.htm
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CIM Commercial Facilities
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China's deputy construction minister Huang Wei warns that many of the ultra-high and often unusual skyscrapers being built in China use designs that have not been tested in earthquakes, which could pose a serious threat.
http://english.people.com.cn/200608/02/eng20060802_289084.html
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CIM Cybersecurity
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Microsoft released its monthly security update with 12 patches, including nine rated as critical.
http://www.microsoft.com/technet/security/bulletin/ms06-aug.mspx

The US Department of Homeland Security (DHS) issued a recommendation to apply Microsoft security patch MS06-040 as quickly as possible. This security patch is designed to protect against a vulnerability that, if exploited, could enable an attacker to remotely take control of an affected system and install programs, view, change, or delete data, and create new accounts with full user rights.
http://www.dhs.gov/dhspublic/display?content=5789
http://www.microsoft.com/technet/security/bulletin/ms06-040.mspx

Google has partnered with badware.org to warn users before the visit a website known previously to have distributed malicious software.
http://www.stopbadware.org/

ScanSafe reports that up to one in 600 social networking pages host malicious software.
http://www.scansafe.net/scansafe/news/story?id=129831

University of Pennsylvania researchers explain how your keyboard can spy on you:
http://www.usenix.org/event/sec06/tech/shah/shah.pdf

AOL has apologized for releasing personal data of more than 650,000 subscribers as part of search data provided for a research project.
http://www.ugcs.caltech.edu/~dangelo/aol-search-query-logs/
http://www.washingtonpost.com/wp-dyn/content/article/2006/08/07/AR2006080700790.html

Jesus Alex Pineda  and Christian Brian Montano, both 19-years of age, were arrested in the US state of Maryland on 5 August in connection with the theft of a laptop and hard disk containing personal information on more than 26 million veterans and military personnel. Charges against a juvenile suspect are pending.
http://www.washingtonpost.com/wp-dyn/content/article/2006/08/05/AR2006080500626.html

This news was followed by the discovery that a Veterans Affairs subcontractor's desktop computer containing personal information on some 38,000 veterans is missing from the Unisys office. Unisys said it will provide free credit monitoring for those affected.
http://www1.va.gov/opa/pressrel/pressrelease.cfm?id=1165

The Department of Transportation Inspector General's office also had a laptop stolen - this containing personal data on 133,000 Florida residents.
http://www.oig.dot.gov/datasecurity.jsp

Cardiff University researchers found a serious security flaw in HSBC's online banking system.
http://business.guardian.co.uk/story/0,,1841853,00.html
http://www.guardian.co.uk/uk_news/story/0,,1842127,00.html

Gartner recommends five best practices to limit public exposure of private data:
* Deploy content monitoring and filtering
* Encrypt backup tapes and (possibly) mass storage
* Secure workstations, restrict home computers, and lock portable storage
* Encrypt laptops
* Deploy database activity monitoring
http://www.gartner.com/it/page.jsp?id=495173
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CIM Dams
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Excessive water levels in dams prior to the monsoon rains are blamed for contributing to devastating floods in India.
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CIM Energy
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BP has closed Alaska's Prudhoe Bay oil field indefinitely. A pipeline leak due to unexpected corrosion must be repaired and pipelines examined for similar problems. It appears that part of the oilfield will be able to continue running, preventing a total shutdown. http://www.bp.com/genericarticle.do?categoryId=2012968&contentId=7020563

Coming while conflict rages in the Middle East and Nigerian supplies are reduced and precarious, this shutdown of the largest oilfield in the US has led to record high oil prices.
http://www.latimes.com/business/la-fi-oil8aug08,0,2431567.story

Calvert County officials in the US state of Maryland have offered $300 million in tax breaks to encourage Constellation Energy Group to expand its nuclear power operation. If this proceeds, it could be the first new operating reactor in the US since 1996, but would take at least ten years to come into operation.
http://www.washingtonpost.com/wp-dyn/content/article/2006/08/09/AR2006080901923.html?referrer=email

Ukraine's new Prime Minister and defeated presidential candidate Viktor Yanukovych says the government will honor its gas supply agreement with Russia, but President Viktor Yushchenko is inclined to review the agreement.
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CIM Nuclear Reactors, Materials, and Waste
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The International Atomic Energy Agency (IAEA), with assistance from Russia and the US, has removed 40 kg of highly enriched uranium from a Polish research facility and returned it to Russia, where it will be converted to low enriched uranium that cannot be used to make a bomb.
http://www.iaea.org/NewsCenter/News/2006/poland.html

The UK Nuclear Decommissioning Authority (NDA) has fined British Nuclear Group Sellafield GBP2 million for breaching regulations that in April 2005 led to a radioactive leak.

NDA published its Operational Review for 2005/6:
http://www.nda.gov.uk/News--News_(1780).aspx?pg=1780
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CIM Telecommunications
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Negotiations between the Australian Competition and Consumer Commission and Telstra over development of a high-speed fiber network for Australia have collapsed due to disagreement over the economic model, leaving no readily available alternative to the aged copper network currently in place.
http://www.telstra.com.au/abouttelstra/investor/docs/tls441_fibretothenode.pdf
http://www.accc.gov.au/content/index.phtml/itemId/757949/fromItemId/2332

UK telecommunications regulator Ofcom reports that a new "networked generation" is turning away from television, radio and newspapers in a radical shift in favor of online services on multiple devices.
http://www.ofcom.org.uk/media/news/2006/08/nr_20060810

The US Federal Communications Commission (FCC) has issued requests for comment regarding wireless and telecommunication licensing and regulations.
http://www.fcc.gov/
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CIM Transportation
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Airline security has come under intense scrutiny as details emerge of an alleged terrorist plot involving liquid explosives on planes flying from the UK to the US. Details of the plan were uncovered by British intelligence services, in conjunction with Pakistan and the US. Explosives detection systems currently in use would not have identified the types of materials that may have been involved in the plot.
http://www.smh.com.au/news/world/murderous-intent-still-a-step-ahead-of-technology/2006/08/11/1154803102444.html
http://www.usatoday.com/news/nation/2006-08-10-explosives-terror_x.htm?csp=34
http://www.timesonline.co.uk/article/0,,3-2308709,00.html

Airport security around the world has been tightened, often by adding troops to patrols and screening facilities. India has expanded Air Force radar monitoring to include all civilian aircraft. The US is deploying extra air marshals and, in some locations, national guards. The EU is holding a meeting of aviation and security experts next week to discuss the alleged plot. Other emergency meetings are scheduled in the Philippines, Australia, and elsewhere, to review aviation security and the current state of intelligence. Asian flights are under particular scrutiny because the types of new restrictions placed on passengers in the US and UK would be extremely difficult on long-haul flights.

Many airlines have imposed rigid restrictions on carry-on luggage, including a ban on all liquids.
Canada
http://www.tc.gc.ca/mediaroom/releases/nat/2006/06-gc010e.htm
UK
http://www.dft.gov.uk/stellent/groups/dft_about/documents/page/dft_about_612280.hcsp
http://www.info.doh.gov.uk/doh/embroadcast.nsf/vwDiscussionAll/2410866367ACC489802571C7004686F7?OpenDocument
US
http://www.tsa.gov/travelers/airtravel/prohibited/new-items.shtm

A fresh threat was revealed by a Sunday Telegraph (Australia) investigation that demonstrated the ability to board domestic flights under false identities.
http://www.news.com.au/sundaytelegraph/story/0,22049,2011,00.html

The US Government Accountability Office (GAO) testified before the House Committee on Homeland Security, Subcommittee on Intelligence, Information Sharing and Terrorism Risk Assessment 14 June hearing on "TSA's Office of Intelligence: Progress and Challenges".  Now, GAO has prepared responses to post-hearing questions regarding Secure Flight, for the record.
http://www.gao.gov/cgi-bin/getrpt?GAO-06-1051R
http://hsc.house.gov/

War risk issues have led London cargo underwriters to as much as triple premiums for shipments into Israel, but local insurers, apparently perceiving little risk, have not increased fees. Ships are being diverted from the main port of Haifa to Ashdod, south of Tel Aviv.
http://www.aon.com/uk/en/about/Press_Office/lebanon.jsp

Lloyds has delisted the Malacca Straits as a wear-risk zone.

The UK Department for Transport has asked DP World to proceed with final plans for the London Gateway container port.
http://www.dpworld.com/fullnews.asp?NewsID=54
http://www.dft.gov.uk/stellent/groups/dft_shipping/documents/page/dft_shipping_612278.hcsp
http://www.dft.gov.uk/stellent/groups/dft_shipping/documents/divisionhomepage/039202.hcsp

The Bahamas has joined the Container Security Initiative.
http://www.cbp.gov/xp/cgov/newsroom/news_releases/08042006_2.xml

The Philippines has banned rail passengers from bringing liquids into train stations and coaches, in addition to similar regulations on all flights.
http://www.abs-cbnnews.com/topofthehour.aspx?StoryId=47255
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CIM Water
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In New Delhi, India, police will provide security for water plants and personnel.
http://cities.expressindia.com/fullstory.php?newsid=196701

Indonesia's Jakarta, Banten and West Java administrations will jointly rehabilitate the Ciliwung, Cisadane, and Citarum Rivers to ensure the water is clean, and to balance supplies between rainy and dry seasons.

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6. Disaster Reduction Monitor

News highlights from the past week are provided in this free email update, but detailed analysis, background information and source documents are only available to subscribers. Disaster Reduction Monitor subscriptions and other titles can be purchased here:
TAMNI Publications

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DRM Incidents
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Yonhap News, based in South Korea, reports on a story in pro-North Korea newspaper Choson Sinbo that says 549 people died in recent floods and 295 remain missing.
http://english.yna.co.kr/Engnews/20060807/430100000020060807145619E4.html
http://english.yna.co.kr/Engnews/20060807/430100000020060807120643E7.html

China has sent more than 20,000 soldiers and paramilitary police to clear up after Typhoon Saomai - the most powerful storm in China in half a century. At least 134 people have died and 163 are missing. Casualties would have been much worse if there had not been a successful evacuation of 1.5 million people ahead of the typhoon. 50,000 houses were destroyed, and there is at least $560 million in damages. The Chinese Red Cross is also responding.

Monsoon rains in Pakistan have killed 200 people since they began in mid-July.

Flooding in southeastern Afghanistan has killed 33 and left thousands homeless.

Hot mud from a damaged gas well in East Java, Indonesia, breached a dam, forcing thousands more from their homes. More than 12,000 people have fled the area. A major road has been closed indefinitely. Lapindo Brantas, which drilled the well for its gas operations, says it is doing all it can to stop the mudflow, which has continued since 29 May. It is possible that the mudflow cannot be contained, and alternatives should be considered.

Severe flooding in western India has inflicted serious damage to the Gujarat economy, including forcing petrochemical plants and oil and gas fields out of production, and submerging diamond mines.

A 6.7 magnitude earthquake hit Vanuatu but caused no damage or casualties.
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DRM Response and Recovery
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Flash floods in Ethiopia left at least 200 dead and 3,000 displaced. Some 300 people are still missing, with rescuers digging with hands, garden tools, and other equipment to search the heavy mud.
http://www.irinnews.org/report.asp?ReportID=55045

The Reserve Bank of India has issued instructions to banks affected by the flooding to help ensure quick restoration of all banking services.
http://www.financialexpress.com/fe_full_story.php?content_id=136937

Spanish police have arrested two men suspected of deliberately causing fires in the northwestern Galicia region. 64 forest fires are burning out of control, and at least four people have died. Portugal is also suffering a spate of fires. High temperatures and low water levels have contributed to the difficulties in bringing them under control. The government has promised more government aid to help fight the fires.

A Swiss prosecutor has charged eight employees of air traffic control Skyguide with manslaughter in connection with the July 2002 air crash that killed 71 people, most Russian schoolchildren.
http://www.iht.com/articles/ap/2006/08/07/europe/EU_GEN_Switzerland_Airliner_Crash.php
http://www.lgkonstanz.de/servlet/PB/menu/1201101/index.html?ROOT=1160540 (in German)

The American Civil Liberties Union (ACLU) released " Abandoned and Abused: Orleans Parish Prisoners in the Wake of Hurricane Katrina", which documents the experiences of thousands of men, women and children who were abandoned at Orleans Parish Prison (OPP) in the days after the storm.
http://www.aclu.org/prison/conditions/26421prs20060810.html

The US Federal Emergency Management Agency (FEMA) has awarded contracts for temporary housing and disaster relief, most going to existing contractors previously awarded no-bid arrangements. The contracts are worth $3.4 billion.
http://www.fema.gov/news/newsrelease.fema?id=28685
http://www.washingtonpost.com/wp-dyn/content/article/2006/08/08/AR2006080801581.html
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DRM Risks
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The National Oceanic and Atmospheric Administration (NOAA) continues to predict an above-normal hurricane season, though less than the records set last year.
http://www.noaanews.noaa.gov/stories2006/s2678.htm

Mount Mayon, a volcano in the Philippines, continues to spew lava and huge flaming rocks. As the full moon approaches, scientists believe the gravitational pull could trigger the anticipated eruption, as happened in the eruptions of 2000 and 2001. Some 35,000 people in the vicinity have been evacuated.
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DRM Mitigation
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North Sulawesi in Indonesia is preparing booklets for the 25,000 residents to provide basic information about earthquake and tsunami preparedness and response.

In the Philippines, the provincial government of South Cotabato is organizing disaster management councils in each of its local districts.

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7. Recommended Reading

A number of recent reports point to sharp increases in fraud, more and more involving threats from insiders and involvement of organized crime, often taking advantage of features or weaknesses in information technology systems. The Association of Certified Fraud Examiners (ACFE) reports that participants in their study estimate that US organizations lose five percent of annual revenues to fraud. Applied to the GDP, this would amount to $652 billion in fraud losses. KPMG's Fraud Barometer reports that fraud in the UK has continued to skyrocket, involving GBP653 million in the first half of 2006, compared to GBP 250 million in the same period last year. Management was the biggest perpetrator, accounting for half of frauds, while professional gangs accounted for just under a quarter of prosecutions. Carousel frauds involving Value Added Tax amounted to nearly GBP10 billion from April to June. BDO Stoy Hayward's FraudTrack reports that employee fraud has increased 200 percent since 2003. The UK Government's Fraud Review reports that stolen assets, lost revenues, costs of prevention and investigation and other items cost the economy at least GBP 14 billion a year and is exceeded only by Class A drug trafficking as a cause of harm. The Serious Organized Crime Agency (SOCA) 2006 threat assessment finds that the economic and social costs of serious organized crime exceeds GBP 20 billion a year.
http://www.acfe.com/fraud/report.asp
http://www.kpmg.co.uk/news/detail.cfm?pr=2597
http://news.bbc.co.uk/2/hi/business/4780685.stm
http://www.bdo.co.uk/BDOSH/Website/bdouk/websiteContent.nsf/56b42e279e413094802569fa0037f554/c87c814e29e4fabe802571310034e469?OpenDocument
http://www.lslo.gov.uk/fraud_review.htm
http://www.soca.gov.uk/assessPublications/index.html

Fraud is a particularly interesting problem in part because the nature of it evolves rapidly and is often amorphous. There is general agreement that fraud is a loss caused through deception or dishonest means. In law, there are a variety of definitions incorporated in laws to address specific incidents, which by their very nature will always lag behind new techniques. Most jurisdictions have general concepts of fraud, but few provide a single legal definition.

The UK is attempting for the first time to define fraud in English law through the Fraud Bill before Parliament. It includes three categories of fraud: by false representation, by failing to disclose information, and by abuse of position.

"Ponzi's Scheme" by Mitchell Zuckoff (Random House) describes the most famous case of fraud by false representation. This biography portrays a remarkable man operating in the remarkable decade of the 1920s, where get-rich-quick schemes (and lack or regulation) created an economic spiral, of which Ponzi's rise and fall was one of the most colorful.
http://www.randomhouse.com/catalog/display.pperl?isbn=9780812968361
Author:
http://www.bu.edu/com/about/faculty/mitchell_zuckoff.html
Reviews:
http://www.chron.com/disp/story.mpl/life/books/reviews/3146964.html
http://www.washingtonpost.com/wp-dyn/articles/A63157-2005Mar24.html

Failing to disclose information enables the global trade in counterfeit goods. Tim Phillips' "Knockoff" (Kogan Page) shows that counterfeiting is not a victimless crime, but instead costs jobs, cripples developing countries, breeds corruption and violence, and kills thousands of people every year. The market for counterfeits is worth more than $500 billion - seven percent of world trade.
http://www.kogan-page.co.uk/bookdetails.aspx?ISBN=0749443790
Reviews:
http://business.timesonline.co.uk/article/0,,9065-1857943,00.html
http://www.iht.com/articles/2006/01/20/yourmoney/mbook21.php

"Lying, Cheating, and Stealing" by Stuart P. Green (Oxford University Press) is a study of white collar crime including business fraud, perjury, insider trading, tax evasion, and where sharp business practices veer to criminal actions.
http://ww.oup.com/us/catalog/general/subject/Law/CriminologyandCriminalJustice/?view=usa&ci=9780199268580
Author:
http://faculty.law.lsu.edu/stuartgreen/
Reviews:
http://lawprofessors.typepad.com/crimprof_blog/2006/08/wall_street_jou.html
http://www.corporatecrimereporter.com/green062206.htm

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8. Asset Management Network News

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