Reid denies involvement in Utah businessman scheme

Monday, 11 February 2013

Salt Lake City, Feb 3 : Senate Majority Leader Harry Reid's office said he was never involved in a deal to have a Utah businessman pay the senator to make a federal investigation disappear.

St. George businessman Jeremy Johnson, who's accused of running a $350 million software scheme, said a top official in the Utah attorney general's office orchestrated an agreement in 2010 to pay $600,000 to someone connected to Reid.

Johnson told The Salt Lake Tribune over the weekend that he believed Reid would intervene in the Federal Trade Commission's investigation into his business.

A spokeswoman for Reid's office, Kristen Orthman, said that the Nevada Democrat "had no knowledge or involvement" in Johnson's case and said the allegations "are nothing more than innuendo and simply not true."

Federal prosecutors allege that Johnson's company sent software to consumers for a supposedly risk-free trial but billed them anyway.

Johnson was arrested at a Phoenix airport in 2011, carrying more than $26,000 in cash and a one-way plane ticket to Costa Rica.

Prosecutors initially charged him with one count of mail fraud. He was set to enter a guilty plea to two additional charges of bank fraud and money laundering as part of an agreement with the government.

But that deal fell apart after Johnson and prosecutors disagreed over the terms. Johnson instead decided to maintain his not guilty plea and the case is set to go to trial.

The Tribune reported that Johnson provided the newspaper with emails, financial statements, photos and a transcript of a recorded meeting with John Swallow, then the state's chief deputy attorney general.

Only one email from Johnson was available on the newspaper's website.

Swallow was elected as Utah Attorney General in November and was sworn into office last week. He has strongly denied the allegations and maintains he only offered to connect Johnson with a lobbying firm.

After the FTC filed a lawsuit against Johnson and nine business associates in December 2010, Johnson said he asked Swallow to return part of the $250,000 he had paid. Johnson said he doesn't know if anyone connected to Reid received it.

Swallow, a Republican, said he told Johnson he would not interfere with the FTC investigation or advocate for Johnson to the U.S. attorney.

"Any suggestion by Mr. Johnson that I have been involved in illegal or inappropriate activity regarding his FTC case or any other matter is false and defamatory," he said.

Swallow said he connected Johnson to someone who could hire lobbyists but did not participate in any agreement or receive any payment. He said Johnson is trying to divert attention from his own problems.

Utah Democrats have called for an independent investigation to look into the allegations against Swallow.

Swallow's office declined to answer questions and said they would be issuing a statement. Messages left with Reid's office for further comment weren't immediately returned.

Swallow's office released a letter asking the U.S. Attorney's Office in Salt Lake City to investigate Johnson's claims.

Swallow said he's confident an investigation will clear his name.

"These lies he's told have been fabricated for some end I cannot imagine. That's what I hope this investigation will show. I'm looking forward to clear my name and show people that this didn't happen," Swallow said.

The U.S. Attorney's Office in Salt Lake City has declined comment on whether there is an investigation into the alleged deal.

Before his arrest, Johnson donated generously to charities and to the political campaigns of former Utah Attorney General Mark Shurtleff. He gave $2,400 to Reid's re-election campaign in July 2010, according to Federal Election Commission records.

Johnson also used his personal helicopters to aid search and rescue efforts in southern Utah and made international headlines in January 2010 when he purchased a plane to fly doctors and other critical supplies to Haiti following a devastating earthquake.

Johnson, 37, could face decades in prison if he's convicted. He is currently free on a $2.8 million bond.

Prosecutors said they plan to file a new indictment in the case within a month, but wouldn't comment on whether other people besides Johnson would be charged.

A spokeswoman for Johnson's attorneys released a statement saying Swallow's claims that he was uninvolved and had no knowledge of the agreement are false.

"Johnson stands by his comments, as told to the Salt Lake Tribune, and continues to believe that his understanding of the agreement to be accurate," the statement said.

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Can we trust CNET again after a scandal this shady?

London, Feb 3 : CNET, one of the Internet's first and most influential authorities on gadgets and tech news, watched its editorial integrity spiral out of control, with staffers quitting and editors left to explain themselves in the wake of explosive new charges over its annual Consumer Electronics Show awards — a scandal, it would appear, that goes all the way to the top of its corporate umbrella, and could shake the entire ecosystem of online tech journalism.

Contrary to an already controversial move first reported, CNET parent company CBS didn't just asked the site to remove Dish's Slingbox Hopper from consideration for its Best of CES Awards amidst a lawsuit between CBS and Dish; the removal came after executives learned the gadget would take the top award, and that request came down from CBS CEO Leslie Moonves himself, sources tell The Verge's Joshua Topolsky. Now, CNET's corporate responsibilities appear to have made the long trusted site bend at will and, despite desperate pushback from some of its writers and editors, it appears CNET may have moved to cover up the series of events that led to the removal of the award.

For CNET, all of this looks very bad. How can readers trust the site for its famously unbiased reviews and industry news coverage if a media-conglomerate overlord is insisting that some things just "can't exist"? The events that have unfolded since the scandal broke wide open haven't exactly restored anyone's faith. Greg Sandoval, a seven-year veteran of the site, announced his resignation on Twitter, citing a lack of "editorial independence" from CBS as his motivation. In a separate tweet, he called CNET's dishonesty about its parent company's involvement with Dish "unacceptable." Since, both CNET and CBS have released not-too-convincing statements.

Following the Verge report and Sandoval's resignation, CNET Editor in Chief Lindsay Turrentine explained how CNET editors did everything in their power to fend off corporate insistence on its editorial decisions, but found the power of a pending deal between two bigger media companies too intimidating. So the editors gave in, and waited. "We were in an impossible situation as journalists," Turrentine wrote, adding that she thought about resigning. "I decided that the best thing for my team was to get through the day as best we could and to fight the fight from the other side." 

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Your cough will last longer than you think, study finds

London, Feb 3 : One week living with a hacking cough seems like forever, but experts say you'll likely have to wait even longer for it to clear up.

According to a new study, the average cough — commonly the result of a cold or other respiratory illness — lasts nearly 18 days.

However, the study also reported that people expect their cough to go away much sooner than 18 days. People surveyed as part of a poll for the study said they expected their cough to last about six to nine days.

This mismatch between expectations and reality may mean that people seek medical care for a cough sooner than they should, and receive unnecessary treatment, the researchers said.

If patients expect  a cough to last about six or seven days, it makes sense that they would seek care earlier than needed, the researchers wrote in the January/February issue of the journal Annals of Family Medicine.

About 50 percent of people who seek medical treatment  for an acute cough will be given antibiotics, even though most of these illnesses are caused by a virus, which does not respond to the drugs.

Providing patients with information about exactly how long their cough should last may reduce the unnecessary use of antibiotics, the researchers noted.

"We need to educate patients that an acute [cough] in an otherwise healthy adult is usually viral, does not require antibiotics, and may easily last a couple of weeks," said study researcher Dr. Mark Ebell, of the University of Georgia Health Science Campus in Athens.

Patients don't need to go to the doctor simply because their cough has lasted a week or more, Ebell said. Reasons to seek care earlier than a few weeks include: having chronic lung disease or another serious chronic illness; shortness of breath or significant wheezing; coughing up blood or rusty sputum; or a sudden worsening of symptoms, Ebell said.

The researchers reviewed information from 19 previous studies, conducted between 1976 and 2010, which examined cough duration in adults. Those with a serious chronic respiratory illness, or those whose coughing was caused by pneumonia, tuberculosis, asthma, allergies or sinusitis, were excluded from the studies.

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Chinese companies retreat from U.S. listings as scrutiny mounts

New York, Feb 3 : Chinese companies are deserting U.S. stock markets in record numbers as regulatory scrutiny mounts and the advantages of a U.S. listing slip away.

U.S. government investigations of suspect financial reports and battered share prices have for many Chinese companies wrecked the chances of raising new money in the United States and given them little reason so stay, China experts said.

"There's very little in way of new capital flows to those companies, their valuations are low and they're encountering significant headwinds in terms of regulatory oversight," said James Feltman, a senior managing director at Mesirow Financial Consulting.

Twenty-seven China-based companies with U.S. listings announced plans to go private through buy-outs in 2012, up from 16 in 2011 and just six in 2010, according to investment bank Roth Capital Partners. Before 2010, only one to two privatizations a year were typically done by China-based companies, Roth said.

In addition, about 50 mostly small Chinese companies "went dark," or deregistered with the U.S. Securities and Exchange Commission, ending their requirements for public disclosures. That was up from about 40 in 2011 and the most since at least 1994, when the SEC's records start.

Companies with a limited number of shareholders can voluntarily go dark and rid themselves of the cost of public filings without buying out investors, but those investors often suffer as the value of their shares falls.

"It's just another black eye for (Chinese) U.S.-listed companies," said James O'Neill, managing director of Jin Niu Investment Management Co, a Beijing-based firm.

Meanwhile, just three Chinese companies successfully went public on U.S. exchanges in 2012, down from 12 in 2011 and 41 in 2010.

About 300 China-based companies still have shares trading in the United States on exchanges or "over-the-counter" between individual dealers.

Bankers are aggressively pitching the idea of companies pulling out of the United States and relisting elsewhere, saying they can get a better share price in Hong Kong or mainland China, according to lawyers who work on going-private deals.

"The idea is that the markets here understand the China story better and will therefore hopefully assign a higher valuation to the stocks," said Mark Lehmkuhler, a partner at Davis Polk in Hong Kong.

U.S.-listed Chinese companies in the consumer staples sector, for example, were trading recently at a 67 percent discount to comparable Chinese companies on the Hong Kong Exchange, according to investment bank Morgan Joseph.

A failure by U.S. regulators to reach an agreement soon with China on accounting oversight may push more Chinese companies to abandon their U.S. listings, bankers and lawyers said.

The United States has been trying to get access to audit records and permission to inspect Chinese audit firms to combat a rash of accounting scandals. China has balked, leaving the future of U.S. listings for Chinese companies in doubt.

"I expect everyone is making alternative arrangements" in case U.S. and Chinese regulators do not reach a deal, said Paul Gillis, an accounting professor at Peking University in Beijing.

Stepping up pressure, the SEC has deregistered about 50 China-based companies over the past two years. Last month, it charged the Chinese arms of five top accounting firms with securities violations for failing to turn over documents, raising tensions in its standoff with China.

While most of the recent going-private transactions have been management-led buy-outs, cheap share prices have also led to several deals from large private equity firms.

A Carlyle Group LP-led consortium (CG.O) last month agreed to buy display advertising company Focus Media Holding Ltd (FMCN) for about $3.7 billion in the largest-ever private equity deal in China. The success of that deal may prompt others, lawyers said.

"As long as you've got financing available, you're likely to continue to see new deals being announced," said Jesse Sheley, a partner at Kirkland & Ellis who worked on the Focus Media deal.

Despite the billions being poured into the private markets, it may take longer for U.S. stock investors to feel comfortable investing in Chinese public companies again.

Investors are saying, "'What can I trust about these companies at all?'" said O'Neill at Jin Niu. "It's not a matter of good company versus bad company. The market has just turned against you."

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