Police warn they may not be able to afford Tesco's £3m riot compensation bill

 

In total, the retailer has asked for nearly £3m in compensation from police forces around the country, following the riots that tore through some high streets in August. It is likely that this is the biggest request from a single retailer. The company is claiming under the Riot Damages Act, a piece of Victorian legislation that allows businesses and individuals affected by riot damage to claim directly from the police, rather than their own insurer. In the immediate aftermath of the civil disturbances, the British Retail Consortium urged small retailers to put in their claims to make sure their businesses were not harmed. However, the Greater Manchester Police Authority, which has been hit with 280 claims totalling £4.4m, has criticised Tesco for using the Act, saying there was no guarantee the police force would be able to afford all of the compensation. The force faces £134m budget cuts in the next five years. It added that J Sainsbury was one of a number of large companies that had chosen not to submit any compensation claims. Tesco has submitted more than 20 claims for compensation to Manchester police, including one for £40-worth of looted stock.

Brussels threatens to sue Britain to let in 'benefit tourists'

 

Ministers fear the move could leave taxpayers handing out as much as £2.5  billion to EU nationals, including out-of-work “benefit tourists”, a new cost that could wreck Coalition plans for welfare reform. The commission’s threat, on the eve of the Conservative Party conference, has raised the political temperature on Europe still further. In an outspoken attack today, Iain Duncan Smith, the Work and Pensions Secretary, says the commission’s move is part of a “wider movement” by the “unelected and unaccountable” European authorities to extend their power over the UK. “This kind of land grab from the EU has the potential to cause mayhem to nation states, and we will fight it,” he writes in The Daily Telegraph. The commission is objecting to Britain’s rules on welfare, claiming they discriminate unfairly against foreigners. To claim benefits in Britain, EU nationals must pass a “right to reside” test. The commission says the test is too tough, and wants Britain to apply more generous EU-wide rules.

Legal warning to UK over benefits for EU nationals

 

The European Commission has threatened legal action against the UK, saying a test of eligibility for benefits discriminates against foreigners. It says it is easier for UK citizens to prove their "right to reside" - a test imposed by the UK for certain benefits - than EU nationals. The commission says it may refer the case to the European Court of Justice. Ministers say it is a "fundamental challenge" to the UK's right to decide its own social security arrangements. The Commission says it has been in talks with the UK for several years over the issue and is responding to a "huge number" of complaints from EU citizens living in the UK. Residence tests On Thursday it announced that it was giving the UK two months to explain how it was going to bring its legislation into line with EU law - prompting UK Work and Pensions Secretary Iain Duncan Smith to accuse it of a "land grab" and to pledge to fight it. A range of entitlements - including child benefit, child tax credit, state pension credit, jobseekers' allowance and employment and support allowance - are given only to those with a "right to reside" in the UK. Continue reading the main story WHAT BENEFITS ARE INVOLVED Child benefit Child tax credit State pension credit Jobseekers' allowance The Commission says there are already an EU-wide "habitual residence" rules which are strict enough and the UK is imposing an additional test, which indirectly discriminates against non-UK EU nationals. While UK nationals can easily prove their "right to reside" based on their UK citizenship, other EU nationals have their applications heard on a case-by-case basis, which it says breaches EU social security co-ordination rules giving all citizens equal rights. The Commission gives the example of a woman who moved to the UK and worked from April 2007 to April 2009 when she was made redundant. It says she had paid taxes and National Insurance but was refused claims for jobseekers' allowance. 'Very sound' It says UK citizens in other EU states do not have to meet similar tests and get non-contributory benefits. Laszlo Andor, Commissioner for Employment and Social Affairs, said the EU's legal position was "very sound". Continue reading the main story “ Start Quote We are talking here.. about people who are inactive, people who are looking to come to the UK who are not going to work here” Chris Grayling Employment minister "The EU insists on the right of mobile workers to move from one country to another and, in certain places, they are entitled to benefits," he told the BBC. "We want to protect the rights of all EU citizens." Most people moving abroad already had offers of work or were looking for it, he said, rather than primarily wanting to take advantage of more generous benefits. "It may happen that some of them do not a find a job immediately. It is very important that, in these cases, the rights should be respected." He added that some people might choose to move to a country where benefits were higher but "since we have a European Labour market we have to accept this as a fact". But UK ministers fear taxpayers could be forced into handing out more than £2bn to EU nationals - including so-called "benefits tourists" - if the UK has to comply. 'Difference of opinion' Employment minister Chris Grayling, who met EU officials this week to discuss the issue, said there was a "very definite difference of opinion" between the UK and the Commission. "We are talking here, not about active citizens, not about people who are working but people who are inactive, people who are looking to come to the UK who are not going to work here." He said European law was "all over the place at the moment" and the UK had separately been told by the European courts to make disability benefit payments to a British citizen living in Spain. He said 13 EU states had proposed a "comprehensive review" of policy in the area in June and talks were continuing. Nigel Farage, leader of the UK Independence Party, which campaigns for Britain's exit from the EU, said: "It is not discrimination but simply a system to ensure that benefits are only paid to those who are entitled to them."

Authorities say they have arrested a former Hells Angels leader at a park in Honolulu.

 FBI agents and Honolulu police took Stephen Sanders, former head of the San Diego Hells Angels, into custody without incident in Ala Moana Park on Thursday, Agent Tom Simon said. The 42-year-old Sanders was wanted in California in connection with a 2007 robbery and kidnapping. The Hawaii arrest comes the same day that more than two dozen members of the Hells Angels and their associates were apprehended in a series of San Diego County raids. FBI spokesman Darrell Foxworth told the San Diego Union-Tribune (http://bit.ly/rmikpu ) that the 26 arrests came at the end of a violent crimes task force investigation. Simon said Sanders' arrest on the same day of the raids was a coincidence.

Hells Angel slaying suspect arrested in San Fran

 

University of California, San Francisco police have arrested the suspect in the slaying of the president of a Hells Angels chapter at a Nevada casino. UCSF Assistant Police Chief Paul Berlin says 53-year-old Ernesto Manuel Gonzalez was taken into custody after he was spotted by an officer just a block from campus police headquarters around 8:20 p.m. Thursday. Gonzalez was apparently in a parked 2011 Chevrolet Malibu. He is being held pending the arrival of police from Sparks, Nev., where he is accused of killing Jeffrey "Jethro" Pettigrew inside a casino on Sept. 23. Authorities say Gonzalez is an alleged member of the Vagos gang and shot the 51-year-old Pettigrew four times in the back. Pettigrew was the president of the San Jose chapter of the Hells Angels.

Spanish sailors to be decorated after rescuing French woman taken hostage by pirates

 

The Defence Minister, Carme Chacón, announced that Spanish forces from the amphibious assault ship, ‘Galicia’, are to be decorated for rescuing a French woman who was taken hostage with her husband by Somali pirates off the coast of Yemen earlier this month. Evelyne Colombo was rescued on September 10 two days after the catamaran she and her husband were sailing had been attacked by pirates. Her husband, Christian Colombo, was murdered and his body thrown into the sea during the pirates’ assault. The Galicia was on patrol with the EU anti-piracy mission Operation Atalanta when it intercepted the skiff which was transporting the 55 year old French woman. Operation Atalanta command ordered the Galicia to open fire on the skiff’s engines and the pirates responded by shooting at the Spanish ship. The pirate skiff capsized after the gun battle, but the hostage was rescued and seven pirates were arrested.

El Hierro still on yellow alert, but no fears of an imminent eruption

 

UME Emergency Military Unit was deployed to El Hierro on Wednesday as the island remained on yellow alert amid fears of a volcanic eruption. The Defence Minister, Carme Chacón, was also due to travel there on Wednesday afternoon to supervise their work, and spoke of the UME’s deployment as a preventive measure to assist emergency services in any evacuation over the increased seismic activity on the island. EFE indicates that there is a 15 percent probability of an imminent eruption, but the island’s government has ruled out any need to evacuate the island. The President of El Hierro’s Cabildo, Alpido Armas, said, ‘That’s not going to happen. We will not need to evacuate 4,000 people. If there is an eruption, it will not be a violent one and the worst that can happen is that a 200 metre mountain emerges’. Fifty three people were evacuated from Frontera due to the seismic activity and it’s understood that they will not be allowed home for the moment. Local schools there were also closed as a precaution because of the risk of landslides. The last volcanic eruption on El Hierro was in 1793, when the Lomo Negro volcano erupted. The last on the Canary Islands was just 40 years ago on La Palma.

Wanted Belgian fugitive arrested in Alhaurín El Grande

 

wanted Belgian fugitive has been arrested in Alhaurín El Grande after a marijuana plantation was discovered at a property in the town. He was found there with a man and a woman, and all three are believed to have been part of an organisation which cultivated the drug for distribution in Europe. The Civil Guard found 55 marijuana plants on the property plus a 9 calibre revolver. One of the group was identified as F.V.B., who was wanted on a warrant for extradition to Belgium to serve a prison sentence of four and a half years for armed robbery. EFE indicates that he took part in an armed hold-up of a goods lorry in Wervik in 2009, where the lorry driver was assaulted with an electric shock weapon and left handcuffed and tied up by the neck.

Franco mass grave found in Jerez

 

It has been a local rumour for many years, that the El Marrufo estate in Jerez de la Frontera had been used to bury hundreds of people shot under Franco. The rumour was well known in nearby Cortes de la Frontera, Jimena de la Frontera and Ubrique. But the investigations made by archaeologists over the summer have confirmed the site, the size of ten football pitches, filled with bones and bullet casings. There were so many casings the archaeologists said they were like seeds, labelled ‘Piritécnica Sevilla 1936’. Jesús Román, one of the archaeologists working at the side says they think it could be ‘one of the largest mass graves away from an official cemetery, and think there are between 300 and 600 bodies present. The El Marrufo Estate was used as a detention, torture and execution centre, dealing with about ten people a day. Women and children as well as men were killed at the site.

Ferronats, a company formed by Spanish construction firm, Ferrovial and British air traffic controllers, Nats, has won 10 of the 13 tenders to run control towers at Spanish airports

 

Ferronats, a company formed by Spanish construction firm, Ferrovial and British air traffic controllers, Nats, has won 10 of the 13 tenders to run control towers at Spanish airports as AENA privatises 49% of the company. It will control Alicante, Valencia, Ibiza, Sabadell, Sevilla, Jerez, Melilla, Cuatro Vientos, Vigo and A Coruña. The remaining three towers on the Canary Islands at Lanzarote, Fuerteventura and La Palma have been awarded to the Sacerco company. AENA estimates savings of 46.6% as a result, with Ferronats bidding 70.4 million, and Sacerco bidding 20 million.

Iberia to launch new low cost airline next week

 

Iberia is planning to launch a new low cost airline next week. The Iberia board is expected to approve the project on Tuesday 4 October, to launch the low cost airline for the company’s short and medium distance services. The new airline is expected to take up 37 of the 69 A-320 aircraft the airline currently has in service. Iberia is now merged with British Airways to create the IAG, the International Airline Group, and the IAG board would have to ratify the decision on Thursday. Iberia has been holding talks with the pilots’ union SEPLA on the conditions for them in the new airline. The airline contends that it needs a structural reorganisation, but the union considers that all the flights should remain under the Iberia brand, and considers maintenance would be cheaper with a single company. An earlier leasing of six planes to Vueling, the budget airline with a 45.85% Iberia shareholding, proved unsuccessful with Iberia passengers complaining they were being put on Vueling flights. Five of those six planes are now back with Iberia. The expected name for the new airline, Iberia Express, was first mentioned back in October 2009.

Rio hit with £500k bill after losing court battle

The England and Manchester United star will now be saddled with paying the estimated £500,000 legal bills incurred by the Sunday Mirror in defence of the lawsuit.

Ferdinand sued the newspaper for misuse of private information after they published details of his 13-year relationship with interior designer Carly Storey, who accepted £16,000 for telling the tale of her liaisons with the defender.

But Mr Justice Nicol dismissed the case at London's high court on Thursday, and refused Ferdinand's legal team permission to appeal.

"Overall, in my judgment, the balancing exercise favours the defendant's right of freedom of expression over the claimant's right of privacy," he said.

The judge was not swayed by Ferdinand's claims that he had not tried to meet Storey after being made England captain, despite claims in the newspaper that he had snuck Storey into the team hotel.

"I did not find this answer persuasive. In his evidence the claimant said that (Fabio) Capello had told him to be professional, not only on the pitch but 'around the hotel'," the judge said.

"In the past, the Claimant (Ferdinand) had not behaved in a professional manner around the hotels into which he had tried to sneak Ms Storey.

"Whether or not he had done that in the few weeks since he had been made the permanent captain of England, his relative recent past failings could legitimately be used to call into question his suitability for the role."

Former England captain Ferdinand, who has three children with wife Rebecca, had told the judge at an earlier hearing that, "I do not see why I should not be entitled to a private life just because I am a famous footballer."

Sunday Mirror editor Tina Weaver hailed the judge's decision.

"The Sunday Mirror is very pleased that the court has rejected Rio Ferdinand's privacy claim," she said.

"The judge found that there was a justified public interest in reporting the off-pitch behaviour of the then England captain and discussion of his suitability for such an important and ambassadorial role representing the country.

"We are pleased the judge ruled that Mr Ferdinand had perpetuated a misleading public image and the Sunday Mirror was entitled to correct this impression.

"There has never been greater scrutiny of the media than now, and we applaud this ruling in recognising the important role a free press has to play in a democratic society."

Rio hit with £500k bill after losing court battle

The England and Manchester United star will now be saddled with paying the estimated £500,000 legal bills incurred by the Sunday Mirror in defence of the lawsuit.

Ferdinand sued the newspaper for misuse of private information after they published details of his 13-year relationship with interior designer Carly Storey, who accepted £16,000 for telling the tale of her liaisons with the defender.

But Mr Justice Nicol dismissed the case at London's high court on Thursday, and refused Ferdinand's legal team permission to appeal.

"Overall, in my judgment, the balancing exercise favours the defendant's right of freedom of expression over the claimant's right of privacy," he said.

The judge was not swayed by Ferdinand's claims that he had not tried to meet Storey after being made England captain, despite claims in the newspaper that he had snuck Storey into the team hotel.

"I did not find this answer persuasive. In his evidence the claimant said that (Fabio) Capello had told him to be professional, not only on the pitch but 'around the hotel'," the judge said.

"In the past, the Claimant (Ferdinand) had not behaved in a professional manner around the hotels into which he had tried to sneak Ms Storey.

"Whether or not he had done that in the few weeks since he had been made the permanent captain of England, his relative recent past failings could legitimately be used to call into question his suitability for the role."

Former England captain Ferdinand, who has three children with wife Rebecca, had told the judge at an earlier hearing that, "I do not see why I should not be entitled to a private life just because I am a famous footballer."

Sunday Mirror editor Tina Weaver hailed the judge's decision.

"The Sunday Mirror is very pleased that the court has rejected Rio Ferdinand's privacy claim," she said.

"The judge found that there was a justified public interest in reporting the off-pitch behaviour of the then England captain and discussion of his suitability for such an important and ambassadorial role representing the country.

"We are pleased the judge ruled that Mr Ferdinand had perpetuated a misleading public image and the Sunday Mirror was entitled to correct this impression.

"There has never been greater scrutiny of the media than now, and we applaud this ruling in recognising the important role a free press has to play in a democratic society."

Paramedics Who Tried To Save Singer's Life Give Evidence

 

Alberto Alvarez was in charge of back stage during Jackson's final rehearsal on June 24, 2009. He described Jackson as "happy and in good spirits" during the performance. "He was doing very well for the most part," he told the Los Angeles court. He explained that he later drove Jackson back to his rented Holmby Hills home and saw Dr Murray's car parked there. He said the last time he saw Jackson alive was when he said "good night" to the singer. Mr Alvarez was the first person who went into Jackson's bedroom after Dr Murray telephoned for help as he was trying to resuscitate the singer. He said Jackson was lying on his back, with his hands extended out to his side, and his eyes and mouth open. "When I came into the room, Dr Murray said 'Alberto, hurry, we have to get to hospital, we have to get an ambulance'." Jackson's logistics director Alberto Alvarez He then described how Jackson's children Paris and Prince entered the room behind him. "Paris screamed out 'Daddy' and she was crying. "Dr Murray said to me 'Don't let them see their dad like this see'. "I ushered the children out and told them 'Don't worry, we will take care of it, everything is going to be OK'." Mr Alvarez asked what had happened, to which Dr Murray replied: "He had a bad reaction". Two paramedics who tried to save Jackson's life are also due to give evidence on day three of the trial. Martin Blount and Richard Senneff are expected to say that Jackson already appeared to be dead when they arrived at his home on June 25, 2009. The court will also hear from another key witness - Jackson's personal chef Kai Chase. Sky's US correspondent Greg Milam, who is at the court, said: "There are fewer demonstrators, fans of Michael Jackson, and supporters of Dr Murray here today - but they are still being very vocal in their support of both sides in the case." On Wednesday, Jackson's security chief revealed how the star's children crumpled in shock, as they saw their apparently dead father being given heart massage in his bedroom. The court also heard that Dr Conrad Murray, accused of involuntary manslaughter over Jackson's death two years ago, asked aides if any of them knew how to do cardiopulmonary resuscitation (CPR). "Paris was on the ground balled up crying, and Prince was standing there, and he just had a real shocked, you know just slowly crying type of look on his face," bodyguard Faheem Muhammad, referring to two of Jackson's three children, said. "I went and gathered them together, and I kind of talked to them for a second, got the nanny... and we walked downstairs and put them in a different location," he said. He was describing the scene after he was called up to the master bedroom of Jackson's rented Los Angeles mansion where the star died after an overdose of a powerful sedative. The defence team for the doctor insists Jackson self-administered other sedatives, prompting the overdose while his physician was outside the bedroom. Dr Murray, 58, faces up to four years in jail if convicted of involuntary manslaughter for administering the overdose of Propofol.

Paramedics Who Tried To Save Singer's Life Give Evidence

 

Alberto Alvarez was in charge of back stage during Jackson's final rehearsal on June 24, 2009. He described Jackson as "happy and in good spirits" during the performance. "He was doing very well for the most part," he told the Los Angeles court. He explained that he later drove Jackson back to his rented Holmby Hills home and saw Dr Murray's car parked there. He said the last time he saw Jackson alive was when he said "good night" to the singer. Mr Alvarez was the first person who went into Jackson's bedroom after Dr Murray telephoned for help as he was trying to resuscitate the singer. He said Jackson was lying on his back, with his hands extended out to his side, and his eyes and mouth open. "When I came into the room, Dr Murray said 'Alberto, hurry, we have to get to hospital, we have to get an ambulance'." Jackson's logistics director Alberto Alvarez He then described how Jackson's children Paris and Prince entered the room behind him. "Paris screamed out 'Daddy' and she was crying. "Dr Murray said to me 'Don't let them see their dad like this see'. "I ushered the children out and told them 'Don't worry, we will take care of it, everything is going to be OK'." Mr Alvarez asked what had happened, to which Dr Murray replied: "He had a bad reaction". Two paramedics who tried to save Jackson's life are also due to give evidence on day three of the trial. Martin Blount and Richard Senneff are expected to say that Jackson already appeared to be dead when they arrived at his home on June 25, 2009. The court will also hear from another key witness - Jackson's personal chef Kai Chase. Sky's US correspondent Greg Milam, who is at the court, said: "There are fewer demonstrators, fans of Michael Jackson, and supporters of Dr Murray here today - but they are still being very vocal in their support of both sides in the case." On Wednesday, Jackson's security chief revealed how the star's children crumpled in shock, as they saw their apparently dead father being given heart massage in his bedroom. The court also heard that Dr Conrad Murray, accused of involuntary manslaughter over Jackson's death two years ago, asked aides if any of them knew how to do cardiopulmonary resuscitation (CPR). "Paris was on the ground balled up crying, and Prince was standing there, and he just had a real shocked, you know just slowly crying type of look on his face," bodyguard Faheem Muhammad, referring to two of Jackson's three children, said. "I went and gathered them together, and I kind of talked to them for a second, got the nanny... and we walked downstairs and put them in a different location," he said. He was describing the scene after he was called up to the master bedroom of Jackson's rented Los Angeles mansion where the star died after an overdose of a powerful sedative. The defence team for the doctor insists Jackson self-administered other sedatives, prompting the overdose while his physician was outside the bedroom. Dr Murray, 58, faces up to four years in jail if convicted of involuntary manslaughter for administering the overdose of Propofol.

Raids in 7 countries in $200M investment fraud

 

Dutch authorities say raids have been conducted in seven countries in connection with an alleged $200 million investment fraud scheme, and four men have been arrested. The country's financial crime prosecutors say they suspect hundreds of investors were conned into fraudulent investments in U.S. life insurance policies by a firm called Quality Investments BV. Prosecutors said Wednesday four Dutch men have been arrested, two in the Netherlands and one each in Switzerland and Turkey. Raids were also conducted in Spain, Dubai, England and the United States, in which millions of euros in assets were seized in hopes of recovering some money for duped investors.

Raids in 7 countries in $200M investment fraud

 

Dutch authorities say raids have been conducted in seven countries in connection with an alleged $200 million investment fraud scheme, and four men have been arrested. The country's financial crime prosecutors say they suspect hundreds of investors were conned into fraudulent investments in U.S. life insurance policies by a firm called Quality Investments BV. Prosecutors said Wednesday four Dutch men have been arrested, two in the Netherlands and one each in Switzerland and Turkey. Raids were also conducted in Spain, Dubai, England and the United States, in which millions of euros in assets were seized in hopes of recovering some money for duped investors.

Global swoop nets huge haul of fake drugs: Interpol

 

Police and customs officers from 81 countries have seized 2.4 million doses of counterfeit medicine sold over the Internet during a one-week operation, international police body Interpol said Thursday. Fifty-five people were arrested during the September 20-27 operation, codenamed Pangea 4, and more than 13,000 websites closed down, Interpol said. More than 100,000 illegal doses were seized in France, over half of which were for supposed to be for treating male erection problems, France's medical security agency that took part in the operation, AFSSAPS, said. The operation was carried out for the fourth successive year in an effort to inform the public about the risks of buying medicines online. "Interpol's member countries and partners have shown through the success of Operation Pangea IV the Internet is not an anonymous safe haven for criminals trafficking illicit medicines," said Interpol secretary general Ronald Noble. The agency said it had targeted Internet service providers, online payment companies and delivery companies during the operation, in order that the whole supply chain of fake drugs be broken down. "We cannot halt the illicit online supply of medicines without a consistent, constant and collective international effort involving all sectors," said Aline Plancon, head of Interpol's fake drugs department. "The operation itself was only made possible thanks to a combined effort involving the 165 different participating agencies sharing and exchanging live information via Interpol's headquarters in Lyon," she said. Interpol has also posted messages on Internet video sharing sites warning punters "Don't Be Your Own Killer" by buying unlicensed pharmaceuticals.

Motorway speed limit to be raised

 

The speed limit on Britain’s motorways is set to rise to 80mph but with a big expansion in the number 20mph zones in cities and towns, The Independent has learnt. As part of a deal negotiated with the Liberal Democrats the Transport Secretary Phillip Hammond is expected to announce the Government’s intention to bring in the new speed limit at the Conservative conference. Ministers will then consult on the proposal later in the year along with plans to significantly expand the number of areas in Britain covered by 20mph zones.

Irish expat charged with prostitutes' murder in Spain

 

The 42-year-old man, who is believed to be Irish, was arrested near his home in the resort of Mijas Costa, near Marbella on Spain's southern coast on Friday. The suspect's girlfriend and her mother were also being held over possible involvement in the serial slayings. Police suspect him of stabbing two prostitutes to death, the first in August and the second a month later. The killer was dubbed the "10 murderer" because both women were killed on the tenth of the month. The first woman, said to be 45 years old and of Argentine origin, was found dead in her apartment in the nearby resort of Calahonda. She had been stabbed at least 15 times and was found by her son with a pillowcase tied round her neck and a cushion over mouth. A month later police discovered the body of a 47-year-old Ecuadorian born woman at her home in San Pedro near Marbella. She had 12 stab wounds to her chest and neck. Both women reportedly advertised their services through local newspapers. Post mortem evidence suggested the two women shared the same killer. Police are investigating whether the suspect could be linked to other unsolved murders across Spain.

Blasts hit ex-home of Franco-era politician

 

A Spanish official says two homemade explosive devices detonated outside the childhood home of Manuel Fraga, the last surviving member of the regime of Gen. Francisco Franco. No one was hurt. An official with the Interior Ministry office in Lugo province in northwest Spain says Monday's blasts broke windows and damaged the facade of the house, which is being turned into a museum by the conservative Popular Party, which Fraga founded. The devices were composed of explosive power of the kind used to make fireworks and butane gas canisters used for camping stoves. The official said there was no immediate claim of responsibility. The official spoke on condition of anonymity in line with ministry rules. Fraga is 88 and has a seat in the Senate.

Spanish police hold suspected 'Irish serial murderer'

 

SPANISH police were last night reported to be holding an Irishman on suspicion of stabbing two women to death in their Costa del Sol homes. Leading Spanish TV station Telecinco described the suspect as Irish. Last night speculation was mounting that detectives were treating him as a suspected serial killer and looking to link him to a series of other unsolved murders across the country. Detectives established a link between the deaths of two women reported to have worked as prostitutes advertising their services through papers. A 45-year-old Spanish woman of Argentine origin was found in her luxury apartment in the Costa del Sol resort of Calahonda on August 11. She had been stabbed 15 times. A month later, police discovered the body of a 47-year-old Ecuador-born woman at her rented home near Marbella. She had bled to death after being stabbed up to 12 times in her chest and neck. Secrecy Due to the investigating judge granting a secrecy order on the case, spokesmen from Spain's National Police and Civil Guard were unable to confirm the name and nationality of the suspect or discuss local media reports he had been carrying false ID when he was arrested. A spokesman for the National Police said: "I've seen the reports suggesting the suspect is Irish and I've also seen other newspaper reports he's from central Europe, but I cannot give you any details about the man who is in custody." His Moroccan girlfriend and her mother were also being held. The man being held in custody was arrested on Friday at a gym near his home in Riviera del Sol near Fuengirola. The block where he was arrested is just a stone's throw from the home of missing Amy Fitzpatrick's mum, Audrey. Police are believed to have arrested him after stolen credit cards belonging to one of the victims was used to withdraw cash from ATMs in the area.

The Teewave AR.1 uses Toray carbon fiber for its chassis, crash structures, body, and interior.

This concept sports car was built, from initial sketches to working prototype, in just nine months.

(Credit: Gordon Murray Design)

 

Creating a new car can take years of development, but Gordon Murray Design put together a running prototype electric sports car in just nine months. The Teewave AR.1 was commissioned by Toray Industries to show off its carbon fiber production.

Toray says that its process can make carbon fiber components in just 10 minutes. The Teewave AR.1 uses Toray carbon fiber for its chassis, crash structures, body, and interior. Other Toray materials make up interior surfaces and components of the car.

 

Gordon Murray Design opted for a modest electric powertrain in the Teewave AR.1, meaning sluggish acceleration.

(Credit: Gordon Murray Design)

 

Those light carbon fiber elements make the overall weight of the Teewave AR.1 just 1,874 pounds. The lithium ion battery pack for the car makes up 530 pounds of that weight.

Gordon Murray Design did not specify the supplier of the electric power train, but its specifications are fairly standard for new electric cars hitting the market. Range is listed as 116 miles using the New European Driving Cycle test procedure, and charging time is 6 hours.

The Teewave AR.1 does not push the boundaries of electric car performance. Its electric motor, driving the rear wheels, only produces 63 horsepower and 132 pound-feet of torque. That means acceleration of 11.4 seconds to 62 mph.

You won't be able to buy a Teewave AR.1 anytime soon. The car will be used by Toray to demonstrate its carbon fiber capabilities. But Toray says its carbon fiber components will scale from a car as small as the Teewave AR.1 to any other size of vehicle.

What this concept also demonstrates is how quickly a new car can, from sketches to a working prototype, can be built. Components such as the electric drive train and suspension are modular, while the carbon fiber can be formed from molds rather than the more time-consuming stamping process for steel, which involves more tooling.

MINI COUPE

It was quite a good idea for Mini to make a coupe version as the fifth body derivative in the model line-up because the earlier variations basically covered the widest customer expectations possible.

If you loved the Mini for what it has always been, you'd easily go for the classic Hatch. Want more fun and there's the Convertible. Need to be a little pseudo and the Clubman awaits you. Crave for family practicality and the Countryman's yours.

But if you needn't any of those values but want a genuinely good looking and driving Mini for yourself, the Coupe is the perfect choice.

The removal of the compartment for rear passengers has allowed Mini to put in place a three-box profile to give the Coupe a nice coupe profile. Adding more fun is a helmet-style roof distinctively coloured from the body.

But that's just about it when it comes to the cosmetic test because the rest of the Coupe is plainly a Mini.

There's no differentiation when it comes to the lights or front grille. Simply, it's the roof that holds the key to your liking of the Coupe.

The fascia is just like in any other Mini: fun but flawed to use.

Despite the booted appearance, the Coupe's boot lid opens in a hatch manner (together with the rear windscreen) which, in essence, makes the Coupe more of a liftback.

No rear perches means that the Coupe has that kind of boot space rarely seen in any Mini. Mini has also taken the opportunity to design the interior boot cover with stylish twin cowls. In functionality terms, the Coupe is all what two people at most would ever need.

And turning to aesthetics again, the interior reaches the same dead end as the exterior in which distinction is only confined to the rear bit. The front seats, steering wheel and fascia are like in other Minis, with the latest aspect being fun in appearance but flawed in ergonomic terms.

But you really can't blame Mini for the vast similarities the Coupe bears to its other siblings.

It's a diversification of a specific model, in the first place, and not entirely all-new on its own. Hence, the need to share as many parts as possible.

The pop-up spoiler has both visual and dynamic benefits.

So if you're expecting the Coupe to feel distinctively special on the move, prepare to frown because it doesn't. However, that can never be considered a bad thing since Minis have always been known to be cars that are great to drive.

The running gear of the Coupe is predictable enough: the engines and transmissions are the ones you have seen around since the Mini's facelift in second-gen form with no changes in power and torque outputs.

The one highlighted here for the Coupe test drive in Germany this month is the range-topping 211hp 1.6-litre petrol-turbo and six-speed manual gearbox for the so-called John Cooper Works guise.

The chassis setup is basically just like in other Minis including a sporty tuning. Absence of rear seats has also allowed engineers to place a cross-member in their place to further increase body rigidity for even better handling.

With this in mind, the Coupe drives very much like the Hatch. Performance is brisk in a straight line and impressive when picking up from low engine revs and when exiting corners.

There's no doubting the Coupe's handling, too. This is as sporty as a car of this small size gets, and the way it grips at high speeds when slamming down the autobahn to its top speed is quite amazing. Special thanks go to a new rear spoiler that pops up at over 80kph (and disappearing again when dipping below 60kph).

Ah, that spoiler, the item much talked-about in the Coupe which many critics have described as more a cosmetic gimmick rather than one for dynamic reasons. But as things turned out during the international driving trials, there seems to also be much weight leaning towards the latter factor.

The Coupe also goes around into corners with the same conviction as the Hatch: superbly agile, finely balanced and virtually free of understeer. It's equally as capable as a rear-drive sports car like the Mazda MX-5, unless your idea of looking out from the car is through the side windows.

There’s some stow space behind the front seats... and more of it in the boot.

Speaking of the driving view, the Coupe does feel different from the Hatch in the sense that the front windscreen is more slanted and not as upright as in the Hatch or Clubman. And the Coupe's rear view is limited, although the view of the spoiler (and the stripes painted on it) looks cool.

A more serious downside (in terms of marketing and not engineering) is the unavailability of an automatic gearbox. Mini still insists that JCW cars must be manual. This means that Thais won't be getting this powerful JCW, unless they order it.

Instead, the Cooper S and Cooper variants will come at the year-end with six-speed slushers, the prior spec having steering-mounted paddle-shifters. There wasn't the chance to sample the Cooper S, but it's fair to say _ based on previous driving experiences of other Minis _ that the Coupe with this power treatment will still be a fast car to drive.

You need not have suspicions about the Coupe's ride: the underlying firmness of the chassis makes for a stiff ride, even on the slightest of potholes on German roads. We'd easily say that the ride on Bangkok streets would be terrifyingly hard.

Tony Blair is unaccountable over business interests, adviser says

 

More questions have been raised over Tony Blair's lucrative business activities after an adviser in his role as a Middle East peace envoy said the former Prime Minister continued to operate outside a defined code of conduct. Channel 4's Dispatches, due to be broadcast tonight, claims that Mr Blair is not required publicly to disclose his commercial interests as he would if he were an MP. Mr Blair combines a £2m-a-year consultancy with the US investment bank JP Morgan with his unpaid post in Jerusalem, where he is heading international efforts in preparation for a future Palestinian state. He also advises the insurance group Zurich Financial, while his company Tony Blair Associates signed a reported £27m-deal advising the Kuwaiti government. They are among a string of globetrotting business interests that have seen him build an estimated personal fortune of £20m since leaving office in 2007. But a senior French diplomat Anis Nacrour, who advised Mr Blair on security for three years, has fuelled doubts over the former Labour leader's public accountability.

Saudi women given right to vote

 

Saudi Arabia will allow women to stand for election and vote, the king announced on Sunday, in a significant policy shift in the conservative Islamic kingdowm. In a five-minute speech, King Abdullah bin Abdulaziz al-Saud said women will also take part in the next session of the unelected, advisory Shura Council, which vets legislation but has no binding powers. "Because we refuse to marginalise women in society in all roles that comply with sharia, we have decided, after deliberation with our senior ulama (clerics) and others... to involve women in the Shura Council as members, starting from the next term," he said in a speech delivered to the advisory body. "Women will be able to run as candidates in the municipal election and will even have a right to vote." Women's rights are regarded as a litmus test for the government's appetite for social and political reform. Saudi Arabia adheres to a strict version of Islamic law that enforces the segregation of the sexes. "This is great news," said Wajeha al-Huwaider, a Saudi writer and women's rights activist. "Women's voices will finally be heard. "Now it is time to remove other barriers like not allowing women to drive cars and not being able to function, to live a normal life without male guardians."

UBS CEO Gruebel resigns over rogue trading loss

 

UBS chief executive Oswald Gruebel has resigned over a $2.3 billion loss caused by rogue trading at its investment division, which is to be restructured now to prevent similar incidents in future, the Swiss bank said Saturday. Gruebel, who had come under heavy pressure from shareholders over the scandal, said he hoped his resignation would allow the bank to restore its reputation in the eyes of clients and investors. Article Controls EMAIL REPRINT NEWSLETTER SHARE "As CEO, I bear full responsibility for what occurs at UBS ( UBS - news - people )," he said in a memo to staff. "From my first day on the job I placed the reputation of the bank above all else. That is why I want to and must act according to my convictions." UBS Europe chief Sergio P. Ermotti will take over immediately as interim chief executive until Gruebel's replacement is appointed. Gruebel's departure caps 10 days of speculation over his future following the bank's announcement that a single London-based trader had evaded internal control systems and gambled away $2.3 billion. The trader, 31-year-old Kweku Adoboli, was arrested Sept. 15 and charged with fraud and false accounting. A judge ordered him Thursday to be held in jail until a hearing next month.

Palestinian leader Mahmoud Abbas makes UN statehood bid

 

Palestinian leader Mahmoud Abbas has submitted his bid to the UN for recognition of a Palestinian state. To rapturous applause in the General Assembly, he urged the Security Council to back a state with pre-1967 borders. He said the Palestinians had entered negotiations with Israel with sincere intentions, but blamed the building of Jewish settlements for their failure. Israeli PM Benjamin Netanyahu said he was reaching out to Palestinians and blamed them for refusing to negotiate. "I continue to hope that President Abbas will be my partner in peace," he said in his speech in New York. "Let's meet here today in the United Nations. Who's there to stop us?" Mr Netanyahu added that the core of the conflict was not settlements but the refusal of the Palestinians to recognise Israel as a Jewish state. Hours after receiving it, UN Secretary-General Ban Ki-moon transmitted the Palestinian request to the Security Council. Israel and the US say a Palestinian state can only be achieved through talks with Israel - not through UN resolutions. 'Come to peace' President Barack Obama told Mr Abbas on Thursday that the US would use its UN Security Council veto to block the move. Continue reading the main story Analysis Jeremy Bowen BBC Middle East editor, New York Some delegations here at the UN in New York gave Palestinian Authority leader Mahmoud Abbas a standing ovation - they were clapping and even whistling in support. That is significant because if it comes to a vote in the Security Council - and if the Americans veto it - Palestinians have a Plan B. That Plan B is to go to the General Assembly - where there are no vetoes - and get enhanced status, not full membership but something better than they have now. The Palestinians say they want to negotiate but not in the way they have negotiated before - there has to be clear parameters and a timetable. The Palestinian point is that since 18 years of negotiation has not worked, let's try something new. "I call upon the distinguished members of the Security Council to vote in favour of our full membership," he told the General Assembly, in what was for him an unusually impassioned speech. He added that he hoped for swift backing. Many delegates gave him a standing ovation. "I also appeal to the states that have not yet recognised the State of Palestine to do so." "The time has come for my courageous and proud people, after decades of displacement and colonial occupation and ceaseless suffering, to live like other peoples of the earth, free in a sovereign and independent homeland," he said. He urged Israel to "come to peace". And he said the building of Jewish settlements was "the primary cause for the failure of the peace process". A spokesman for the Islamist movement Hamas, which controls the Gaza Strip, criticised the speech. Salah Bardawil said Mr Abbas had deviated from the aspirations of the Palestinian people by accepting the 1967 borders, which he said left 80% of Palestinian land inside Israel. 'Future and destiny' Meanwhile in the West Bank, crowds roared their approval as Mr Abbas demanded UN acceptance of a Palestinian state within pre-1967 borders. Continue reading the main story Middle East viewpoints Analyst Yezid Sayigh argues that US and Israeli policies have forced the Palestinians to resort to requesting full UN membership. Israeli commentator Yossi Klein Halevi argues that the Palestinians need to convince the Israelis that any state would not be a threat. "With our souls, with our blood, we will defend Palestine," they said. Mr Abbas had called for peaceful marches in support of his initiative, but some clashes were reported: One Palestinian was shot dead by Israeli troops during clashes in the village of Qusra, south of Nablus, Palestinian sources say At the Qalandiya checkpoint, Israeli troops fired tear gas on stone-throwing Palestinian youths In the village of Nabi Saleh, protesters burned Israeli flags and pictures of President Obama The process began with Mr Abbas presenting a written request for a State of Palestine to be admitted as a full UN member state to the UN secretary general. The BBC's Kim Ghattas at the UN says that until the last minute Western diplomats tried and failed to stop the Palestinians making the request. Even now, efforts are under way to restart direct talks between the Israelis and Palestinians in an attempt to defuse tensions, our correspondent says. The Security Council will examine it and vote on the request. In order to pass, it would need the backing of nine out of 15 council members, with no vetoes from the permanent members. A Security Council vote could take weeks to come about and the US may not even need to exercise its veto - Washington and Israel have been lobbying council members to either vote against the Palestinian plan or abstain. Continue reading the main story Palestinian UN membership bid Palestinians currently have permanent observer entity status at the UN They are represented by the Palestine Liberation Organisation (PLO) Officials now want an upgrade so a state of Palestine has full member status at the UN They seek recognition on 1967 borders - in the West Bank, including East Jerusalem, and Gaza Enhanced observer member status could be an interim option Q&A: Palestinians' UN statehood plans Why Obama has turned towards Israel French President Nicolas Sarkozy has urged a compromise, suggesting the General Assembly give the Palestinians enhanced status as a non-member state to allow a clear timeline for talks - a month to start negotiations, six months to deal with borders and security and a year to finalise a "definitive agreement". A vote on enhanced status - enjoyed by others such as the Vatican - would not require a Security Council recommendation but a simple majority in the General Assembly, where no veto is possible. Currently the Palestinians have observer status at the UN. The "Quartet" of US, European, Russian and UN mediators has been working on reaching a framework agreement to restart talks, based on Mr Obama's vision of borders fashioned from Israel's pre-1967 boundary, with agreed land swaps.

Palestinian leader Mahmoud Abbas makes UN statehood bid

 

Palestinian leader Mahmoud Abbas has submitted his bid to the UN for recognition of a Palestinian state. To rapturous applause in the General Assembly, he urged the Security Council to back a state with pre-1967 borders. He said the Palestinians had entered negotiations with Israel with sincere intentions, but blamed the building of Jewish settlements for their failure. Israeli PM Benjamin Netanyahu said he was reaching out to Palestinians and blamed them for refusing to negotiate. "I continue to hope that President Abbas will be my partner in peace," he said in his speech in New York. "Let's meet here today in the United Nations. Who's there to stop us?" Mr Netanyahu added that the core of the conflict was not settlements but the refusal of the Palestinians to recognise Israel as a Jewish state. Hours after receiving it, UN Secretary-General Ban Ki-moon transmitted the Palestinian request to the Security Council. Israel and the US say a Palestinian state can only be achieved through talks with Israel - not through UN resolutions. 'Come to peace' President Barack Obama told Mr Abbas on Thursday that the US would use its UN Security Council veto to block the move. Continue reading the main story Analysis Jeremy Bowen BBC Middle East editor, New York Some delegations here at the UN in New York gave Palestinian Authority leader Mahmoud Abbas a standing ovation - they were clapping and even whistling in support. That is significant because if it comes to a vote in the Security Council - and if the Americans veto it - Palestinians have a Plan B. That Plan B is to go to the General Assembly - where there are no vetoes - and get enhanced status, not full membership but something better than they have now. The Palestinians say they want to negotiate but not in the way they have negotiated before - there has to be clear parameters and a timetable. The Palestinian point is that since 18 years of negotiation has not worked, let's try something new. "I call upon the distinguished members of the Security Council to vote in favour of our full membership," he told the General Assembly, in what was for him an unusually impassioned speech. He added that he hoped for swift backing. Many delegates gave him a standing ovation. "I also appeal to the states that have not yet recognised the State of Palestine to do so." "The time has come for my courageous and proud people, after decades of displacement and colonial occupation and ceaseless suffering, to live like other peoples of the earth, free in a sovereign and independent homeland," he said. He urged Israel to "come to peace". And he said the building of Jewish settlements was "the primary cause for the failure of the peace process". A spokesman for the Islamist movement Hamas, which controls the Gaza Strip, criticised the speech. Salah Bardawil said Mr Abbas had deviated from the aspirations of the Palestinian people by accepting the 1967 borders, which he said left 80% of Palestinian land inside Israel. 'Future and destiny' Meanwhile in the West Bank, crowds roared their approval as Mr Abbas demanded UN acceptance of a Palestinian state within pre-1967 borders. Continue reading the main story Middle East viewpoints Analyst Yezid Sayigh argues that US and Israeli policies have forced the Palestinians to resort to requesting full UN membership. Israeli commentator Yossi Klein Halevi argues that the Palestinians need to convince the Israelis that any state would not be a threat. "With our souls, with our blood, we will defend Palestine," they said. Mr Abbas had called for peaceful marches in support of his initiative, but some clashes were reported: One Palestinian was shot dead by Israeli troops during clashes in the village of Qusra, south of Nablus, Palestinian sources say At the Qalandiya checkpoint, Israeli troops fired tear gas on stone-throwing Palestinian youths In the village of Nabi Saleh, protesters burned Israeli flags and pictures of President Obama The process began with Mr Abbas presenting a written request for a State of Palestine to be admitted as a full UN member state to the UN secretary general. The BBC's Kim Ghattas at the UN says that until the last minute Western diplomats tried and failed to stop the Palestinians making the request. Even now, efforts are under way to restart direct talks between the Israelis and Palestinians in an attempt to defuse tensions, our correspondent says. The Security Council will examine it and vote on the request. In order to pass, it would need the backing of nine out of 15 council members, with no vetoes from the permanent members. A Security Council vote could take weeks to come about and the US may not even need to exercise its veto - Washington and Israel have been lobbying council members to either vote against the Palestinian plan or abstain. Continue reading the main story Palestinian UN membership bid Palestinians currently have permanent observer entity status at the UN They are represented by the Palestine Liberation Organisation (PLO) Officials now want an upgrade so a state of Palestine has full member status at the UN They seek recognition on 1967 borders - in the West Bank, including East Jerusalem, and Gaza Enhanced observer member status could be an interim option Q&A: Palestinians' UN statehood plans Why Obama has turned towards Israel French President Nicolas Sarkozy has urged a compromise, suggesting the General Assembly give the Palestinians enhanced status as a non-member state to allow a clear timeline for talks - a month to start negotiations, six months to deal with borders and security and a year to finalise a "definitive agreement". A vote on enhanced status - enjoyed by others such as the Vatican - would not require a Security Council recommendation but a simple majority in the General Assembly, where no veto is possible. Currently the Palestinians have observer status at the UN. The "Quartet" of US, European, Russian and UN mediators has been working on reaching a framework agreement to restart talks, based on Mr Obama's vision of borders fashioned from Israel's pre-1967 boundary, with agreed land swaps.

Dowler lawyer pursues US legal action against News Corp

 

The solicitor who represented the family of Milly Dowler in their phone-hacking claims against News Corporation on Friday announced he has teamed up with US lawyers with a view to initiating proceedings targetting Rupert Murdoch and his son James. Mark Lewis of Taylor Hampton has instructed Norman Siegel, a New York-based lawyer who represents 20 9/11 families to seek witness statements from News Corp and directors including the Murdochs in relation to allegations that News of the World staff may have bribed police. He says he intends to assess whether he can launch a class action against News Corp using American foreign corruption laws, which make it illegal for US companies to pay bribes to government officials abroad. "There is a provision within US law, before you start an action to seek depositions from individuals, in this case, such as James Murdoch and Rupert Murdoch and other directors of News Corp," said Lewis. He added Siegel would examine allegations of not just police bribery but also phone hacking and "foreign malpractices." The move will be a fresh setback for News Corp which has been trying to insulate itself against contagion from the UK phone-hacking scandal that has engulfed its British publishing empire. Separately, it emerged that this week US prosecutors at the Department of Justice have written to Murdoch's News Corporation requesting information on alleged payments made to the British police by the News of the World. The DoJ is looking into whether the company may have violated the Foreign Corrupt Practices Act (FCPA). Under FCPA laws, American companies are banned from paying representatives of a foreign government to gain a commercial advantage. The decision to co-ordinate legal efforts on both sides of the Atlantic comes just days after News International confirmed it was in settlement talks with the parents of the murdered 13-year-old schoolgirl. News International is discussing a total package of around £3m including a personal donation from Rupert Murdoch of £1m to a charity of the Dowler's choice. News Corp declined to comment but it is understood that senior executives question whether there is any basis for Lewis's actions.

Spain’s central bank reported this week that things were getting worse for that country’s banks

 

Spain’s central bank reported this week that things were getting worse for that country’s banks — but not because they held a lot of Greek debt or bonds issued by other troubled European economies. The problem, instead, is the same old one. With Spain’s economy weak and home prices falling, bad loans are growing. And the central bank thinks things are getting worse. In a surprisingly frank presentation to investors in London on Tuesday, José María Roldán, the Bank of Spain’s director general of banking regulation, said that Spanish land prices had fallen about 30 percent from the 2007 peak, adjusted for inflation, and that home prices were off about 22 percent. “In both cases, we expect further corrections in the years to come,” he said. For land prices, he said, the bank’s “baseline scenario” was that prices would fall to little more than half of the peak level. The “adverse scenario” indicated that the decline could be significantly worse. That was a significant change from a presentation he made in February. Then, with home prices down about 18 percent from the peak, he argued that the decline was similar to past cyclical downturns and that prices were likely to begin rising soon. Remarkably enough, collapsing home prices have not left Spanish banks holding large amounts of bad mortgage loans, thanks largely to the fact the Spanish mortgage market operated during the boom in far different ways than the American market. But if lending to home buyers was conducted in a far more prudent manner than it was in the United States, lending to real estate developers and construction companies was, if anything, more irresponsible. The higher land prices went, the more eager the banks were to push out loans. The story of how Spain’s banks got into the mess — and the way its mess differs from that of American banks — show that it is impossible for banks to walk away from a collapsing bubble in real estate. It also shows that the structure of mortgage markets can make a major difference in how a collapse plays out. The figures released by the central bank this week showed that by the middle of this year, 17 percent of Spanish bank loans to construction companies and real estate developers were troubled — or “doubtful,” the term favored by the central bank. That figure has been rising rapidly, reflecting the deterioration in real estate values. When the financial crisis first broke out, in 2008 and 2009, it appeared that Spanish banks were in a better position than most, in part because of regulation that had kept the big banks from making some of the mistakes others made. But it turned out that smaller Spanish savings banks were heavily exposed to a real estate market that had outpaced even the United States’ market for a time during the first decade of this century. That market continued to rise after the American housing market stopped climbing. The Bank of Spain has created a program to force mergers of the smaller banks and to bring in better management. It has put about 11 billion euros into the banks to recapitalize them, and is putting in another 15 billion euros in a process that is supposed to be completed by the end of this month, said Antonio Garcia Pascual, the chief Southern European economist for Barclays Capital. But, he added, “our estimate is that the overall number needed is closer to 50 billion euros.” The banks are bleeding from loans secured by raw real estate, and from loans for construction. The pain is made worse because such lending soared during the property boom. It is those loans that are now devastating bank balance sheets, as developers who borrowed to build offices, stores and neighborhoods saw demand dry up and now cannot pay the banks back. Other corporate loans are also showing weakness, as would be expected when unemployment is above 20 percent and not expected to improve for at least two years, but less than 5 percent of those loans are said to be doubtful. There are also signs of trouble in car loans and other loans to individuals.

Spain’s central bank reported this week that things were getting worse for that country’s banks

 

Spain’s central bank reported this week that things were getting worse for that country’s banks — but not because they held a lot of Greek debt or bonds issued by other troubled European economies. The problem, instead, is the same old one. With Spain’s economy weak and home prices falling, bad loans are growing. And the central bank thinks things are getting worse. In a surprisingly frank presentation to investors in London on Tuesday, José María Roldán, the Bank of Spain’s director general of banking regulation, said that Spanish land prices had fallen about 30 percent from the 2007 peak, adjusted for inflation, and that home prices were off about 22 percent. “In both cases, we expect further corrections in the years to come,” he said. For land prices, he said, the bank’s “baseline scenario” was that prices would fall to little more than half of the peak level. The “adverse scenario” indicated that the decline could be significantly worse. That was a significant change from a presentation he made in February. Then, with home prices down about 18 percent from the peak, he argued that the decline was similar to past cyclical downturns and that prices were likely to begin rising soon. Remarkably enough, collapsing home prices have not left Spanish banks holding large amounts of bad mortgage loans, thanks largely to the fact the Spanish mortgage market operated during the boom in far different ways than the American market. But if lending to home buyers was conducted in a far more prudent manner than it was in the United States, lending to real estate developers and construction companies was, if anything, more irresponsible. The higher land prices went, the more eager the banks were to push out loans. The story of how Spain’s banks got into the mess — and the way its mess differs from that of American banks — show that it is impossible for banks to walk away from a collapsing bubble in real estate. It also shows that the structure of mortgage markets can make a major difference in how a collapse plays out. The figures released by the central bank this week showed that by the middle of this year, 17 percent of Spanish bank loans to construction companies and real estate developers were troubled — or “doubtful,” the term favored by the central bank. That figure has been rising rapidly, reflecting the deterioration in real estate values. When the financial crisis first broke out, in 2008 and 2009, it appeared that Spanish banks were in a better position than most, in part because of regulation that had kept the big banks from making some of the mistakes others made. But it turned out that smaller Spanish savings banks were heavily exposed to a real estate market that had outpaced even the United States’ market for a time during the first decade of this century. That market continued to rise after the American housing market stopped climbing. The Bank of Spain has created a program to force mergers of the smaller banks and to bring in better management. It has put about 11 billion euros into the banks to recapitalize them, and is putting in another 15 billion euros in a process that is supposed to be completed by the end of this month, said Antonio Garcia Pascual, the chief Southern European economist for Barclays Capital. But, he added, “our estimate is that the overall number needed is closer to 50 billion euros.” The banks are bleeding from loans secured by raw real estate, and from loans for construction. The pain is made worse because such lending soared during the property boom. It is those loans that are now devastating bank balance sheets, as developers who borrowed to build offices, stores and neighborhoods saw demand dry up and now cannot pay the banks back. Other corporate loans are also showing weakness, as would be expected when unemployment is above 20 percent and not expected to improve for at least two years, but less than 5 percent of those loans are said to be doubtful. There are also signs of trouble in car loans and other loans to individuals.

European banks head towards another meltdown

 

Shares in some of Europe's largest banks fell by 10pc as the cost of insuring European lenders' senior bonds rose to record levels, according to credit default swap prices. The Markit iTraxx Financial Index of contracts on the senior debt of 25 banks and insurers climbed to an all-time high 315.5 basis points. The last banking crisis was regarded by most eurozone members as an Anglo-Saxon phenomenon caused by lax lending controls that resulted in major UK and US institutions either collapsing or having to take costly state-funded bail-outs. To offset the threat of another crisis spreading across the eurozone, European regulators ordered their banks to increase their liquidity buffers. Government bonds were generally viewed as the most liquid and least risky assets to hold. However, this policy has come back to haunt them, leaving many lenders across the region seriously exposed to the eurozone sovereign debt crisis. French banking giants BNP Paribas and Société Générale are among the hardest hit. Recent estimates suggest BNP has eurozone sovereign debt exposure of about €75bn (£65bn), amounting to roughly 6pc of total assets, including €14bn of Greek debt and €21bn of Italian government bonds. The other two major French banks, SocGen and Credit Agricole, each have exposures of a similar size. Between them, France's banks have about €56bn of Greek sovereign bonds alone, and have so far taken 20pc writedowns on this.

European banks head towards another meltdown

 

Shares in some of Europe's largest banks fell by 10pc as the cost of insuring European lenders' senior bonds rose to record levels, according to credit default swap prices. The Markit iTraxx Financial Index of contracts on the senior debt of 25 banks and insurers climbed to an all-time high 315.5 basis points. The last banking crisis was regarded by most eurozone members as an Anglo-Saxon phenomenon caused by lax lending controls that resulted in major UK and US institutions either collapsing or having to take costly state-funded bail-outs. To offset the threat of another crisis spreading across the eurozone, European regulators ordered their banks to increase their liquidity buffers. Government bonds were generally viewed as the most liquid and least risky assets to hold. However, this policy has come back to haunt them, leaving many lenders across the region seriously exposed to the eurozone sovereign debt crisis. French banking giants BNP Paribas and Société Générale are among the hardest hit. Recent estimates suggest BNP has eurozone sovereign debt exposure of about €75bn (£65bn), amounting to roughly 6pc of total assets, including €14bn of Greek debt and €21bn of Italian government bonds. The other two major French banks, SocGen and Credit Agricole, each have exposures of a similar size. Between them, France's banks have about €56bn of Greek sovereign bonds alone, and have so far taken 20pc writedowns on this.

signs of an institutional run on French banks

 

Christine Lagarde, the managing director of the International Monetary Fund, urged Europe's leaders to bail out their fragile banks, as the boss of the eurozone's biggest bank, BNP Paribas, rejected fears that the financial sector was "in peril". Addressing journalists in Washington at the opening of the IMF's annual meeting, Lagarde said that Europe must tackle "this twin problem of sovereign debt and the need to strengthen capital buffers". She said: "It is critical that to fuel growth, banks be in a position to finance the economy, to finance enterprises, to finance households, to finance local governments. To do that they need to have the balance sheet that will actually support credit to the economy." Despite the recent stress tests carried out by the European Banking Authority, which suggested that most of the banks were well-placed to cope with the sovereign debt crisis, the IMF estimates that banks have taken a €300bn (£260bn) hit in the past year as a result of the growing risk of default by Greece and other vulnerable eurozone countries. Lagarde's call came as Baudouin Prot, BNP's chief executive, emphatically denied reports that it was in talks with Middle Eastern investors about securing a capital injection. "I formally deny this," he said. "We have no particular contact because we don't need a capital increase." But French bank shares – which have lost 50% of their value in three months – continued to fall as markets endured one of their worst trading days since 2009. BNP was off more than 5% and close rival Société Générale fell almost 10%. In the UK, bailed-out Lloyds Banking Group was down more than 10%, bearing the brunt of anxiety about a slowdown in economic growth. The FTSE 100 closed down 4.7% with large falls from mining companies, which make up a large part of the index and whose fortunes are closely tied to global economic prospects. Out of the 100 stocks, only technology company Autonomy – supported by a bid from Hewlett-Packard – fell by less than 1%. A survey from the crucial manufacturing sector, which chancellor George Osborne had hoped would lead an economic recovery, exacerbated the nervous mood by suggesting industry had been hit hard by the collapse of confidence around the world. The CBI's monthly industrial trades survey showed declining orders, both at home and abroad, and a rising backlog of finished goods, in the latest evidence that the recovery has stalled. Minutes from the latest meeting of the Bank of England's monetary policy committee revealed on Wednesday policymakers were preparing a new round of quantitative easing to respond to the worsening outlook. The gloom was echoed in the eurozone, where the early, "flash estimates" from the closely watched purchasing managers surveys signalled a sharp downturn in both manufacturing and services growth, adding to fears that Europe could be heading for a new recession. The Greek government announced new austerity measures this week to persuade investors that it is committed to tackling its debts. But investors are still fretting about the potentially devastating impact of a default on the region's banks. BNP insisted on Thursday that it could maintain a core tier one ratio – an important measure of financial strength – of 9% by January 2013 even if it sustained losses through the eurozone crisis. But Mohamed El-Erian, boss of the world's biggest bond investor Pimco, warned in a blog on the FT's website that there were "signs of an institutional run on French banks".

signs of an institutional run on French banks

 

Christine Lagarde, the managing director of the International Monetary Fund, urged Europe's leaders to bail out their fragile banks, as the boss of the eurozone's biggest bank, BNP Paribas, rejected fears that the financial sector was "in peril". Addressing journalists in Washington at the opening of the IMF's annual meeting, Lagarde said that Europe must tackle "this twin problem of sovereign debt and the need to strengthen capital buffers". She said: "It is critical that to fuel growth, banks be in a position to finance the economy, to finance enterprises, to finance households, to finance local governments. To do that they need to have the balance sheet that will actually support credit to the economy." Despite the recent stress tests carried out by the European Banking Authority, which suggested that most of the banks were well-placed to cope with the sovereign debt crisis, the IMF estimates that banks have taken a €300bn (£260bn) hit in the past year as a result of the growing risk of default by Greece and other vulnerable eurozone countries. Lagarde's call came as Baudouin Prot, BNP's chief executive, emphatically denied reports that it was in talks with Middle Eastern investors about securing a capital injection. "I formally deny this," he said. "We have no particular contact because we don't need a capital increase." But French bank shares – which have lost 50% of their value in three months – continued to fall as markets endured one of their worst trading days since 2009. BNP was off more than 5% and close rival Société Générale fell almost 10%. In the UK, bailed-out Lloyds Banking Group was down more than 10%, bearing the brunt of anxiety about a slowdown in economic growth. The FTSE 100 closed down 4.7% with large falls from mining companies, which make up a large part of the index and whose fortunes are closely tied to global economic prospects. Out of the 100 stocks, only technology company Autonomy – supported by a bid from Hewlett-Packard – fell by less than 1%. A survey from the crucial manufacturing sector, which chancellor George Osborne had hoped would lead an economic recovery, exacerbated the nervous mood by suggesting industry had been hit hard by the collapse of confidence around the world. The CBI's monthly industrial trades survey showed declining orders, both at home and abroad, and a rising backlog of finished goods, in the latest evidence that the recovery has stalled. Minutes from the latest meeting of the Bank of England's monetary policy committee revealed on Wednesday policymakers were preparing a new round of quantitative easing to respond to the worsening outlook. The gloom was echoed in the eurozone, where the early, "flash estimates" from the closely watched purchasing managers surveys signalled a sharp downturn in both manufacturing and services growth, adding to fears that Europe could be heading for a new recession. The Greek government announced new austerity measures this week to persuade investors that it is committed to tackling its debts. But investors are still fretting about the potentially devastating impact of a default on the region's banks. BNP insisted on Thursday that it could maintain a core tier one ratio – an important measure of financial strength – of 9% by January 2013 even if it sustained losses through the eurozone crisis. But Mohamed El-Erian, boss of the world's biggest bond investor Pimco, warned in a blog on the FT's website that there were "signs of an institutional run on French banks".