Pope visits jailed butler to grant pre-Christmas pardon

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VATICAN CITY (Reuters) – Pope Benedict made a surprise pre-Christmas visit to the jail holding his former butler on Saturday and pardoned him for stealing and leaking documents that alleged corruption in the Vatican.


The pope and Paolo Gabriele spent about 15 minutes together before Gabriele was freed and allowed to return to his wife and children in their Vatican apartment, Vatican spokesman Father Federico Lombardi said.






“What they said to each other will remain a secret between them … he knows he made a mistake,” Gabriele’s lawyer Cristiana Arru, who was in the apartment when he returned home, told Reuters.


Gabriele was convicted of aggravated theft on October 6 in a case that shone unwelcome publicity on the Vatican. He had been serving an 18-month sentence in a jail cell in the city state’s police headquarters.


Lombardi called the pope’s action “a paternal gesture towards a person with whom the pope shared his daily life for several years … this is a happy ending in this Christmas season to this sad and painful episode.”


Both Lombardi and Arru described the encounter as “intense” because it was the first time the two had seen each other since last May, when Gabriele was arrested after Vatican police found many documents in his possession that had been stolen from the pope’s office.


The pope also pardoned a Vatican computer expert who had received a suspended sentence in a separate trial.


VATILEAKS SAGA


In a saga that became known as “Vatileaks”, Gabriele leaked documents showing what appeared to be a power struggle at the highest ranks of the Church, and internal conflict about how transparent the Vatican’s scandal-plagued bank should be with outside financial authorities.


He told investigators he had acted because he saw “evil and corruption everywhere in the Church” and that information was being hidden from the pope.


The Vatican said Gabriele would no longer be able to work there but would be helped to find a job and start a new life outside its walls together with his family.


“When he came home, the kids jumped up and hung from his neck. It was a very tough time for them. I don’t think the whole episode has sunk in for them yet,” lawyer Arru said.


Gabriele, 46, said at his trial – one of the most sensational in the recent history of the Holy See – that he did not consider himself a thief and that he was motivated by “visceral” love for the Church.


The butler, who served the pope his meals and helped him dress, photocopied sensitive documents under the nose of his immediate superiors in a small office adjacent to the papal living quarters in the Apostolic Palace.


He then hid more than 1,000 copies and original documents, including some the pope had marked “to be destroyed”, among many thousands of other papers and old newspaper clippings in a huge armoire in the family apartment inside the Vatican walls.


A former member of the small, select group known as “the papal family”, Gabriele was one of fewer than 10 people who had a key to an elevator leading directly to the pope’s apartments.


He said at the trial that from his perch as papal butler he was able to see how easily a powerful man could be manipulated by aides and kept in the dark about things he should have known.


The leaked papers revealed inner workings of an institution long renowned for its secrecy, and triggered one of the biggest crises of Pope Benedict’s papacy when they emerged in a muckraking expose by an Italian journalist earlier this year.


The case was all the more embarrassing at a time when the Church was trying to limit the fallout from a series of scandals involving sexual abuse of minors by clerics around the world, as well as from mismanagement at its bank.


However, many people believe the butler could not have acted alone and was a fall-guy for others in the Vatican. Gabriele said during the trial that while he may have been influenced by others, he had no direct accomplices.


The Vatican said the pope had also decided to pardon a second Vatican employee and friend of Gabriele’s, Claudio Sciarpelletti, who was convicted separately of giving police conflicting testimony and given a two-month suspended sentence.


Sciarpelletti, a computer expert, will be able to keep his job in the Vatican.


(Editing by Mark Trevelyan)


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‘Smart-Tattoos’: How They Could End Up Saving Your Life

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So they’re not exactly cute, but if you came of age during the 90s, chances are you have at least regrettable tattoo anyway. (Raise your hand if that same tattoo is in the shape of a butterfly!)   But the latest temporary tattoos do much more than serve as a symbol of misspent youth; they can read a body’s internal processes and alert the user of potential dangers like a dip in blood sugar or a drop in kidney function− all without having to draw any blood.


A recent collaboration between researchers at the University of California San Diego and the University of Toronto created a lightweight and stick-on “smart tattoo.” Embedded in its fibers are a set of “ion-selective electrodes” which is a cooler way of saying “sensors that detect the pH or salt levels of the skin, as well minerals like potassium, and even blood oxidation.”






In other words, it can monitor athletic performance at a granular level, but without any of the bulk or wiring of older sensors. It also means that for the first time, detailed athletic response testing would no longer be limited to the walls of a sports clinic, but could be done daily by the athlete herself. And because the stick-ons are both quick and cheap to produce, it seems a natural fit with a mass market roll-out. Researchers are hoping they’ve designed the next big thing in sports training and expect it to hit shelves within the next twelve months.


MORE: One in Ten Adults Will Be Diabetic in 20 Years


But this athletic testing sensor is only the latest iteration of a variety of body-reading tattoos set to hit the market in the coming year.


Sano Intelligence is in the testing phase of a smart tattoo that reads a wearer’s blood markers. The application would be particularly useful for diabetics, who need to keep strict control over their blood sugar levels and often have to resort to finger-prick tests to determine if those levels are within normal range. The Sano patch would not only allow them to forgo the pain of finger-pricks, but the constant hassle of dragging around testing devices and interrupting daily activities to draw their own blood.


And Boston-based MC10 announced earlier this year that it would soon release its own “stretchable electronics” patch, that can be applied internally to human organs, or externally to human skin, or clothing, depending on what needed to be monitored.  The stick-on’s ability to remain flexible while reading vital signs means that it could effectively gauge the function of specific organs, track brain processes, and monitor more mainstream functions like heart rate, blood oxidation and body hydration. 


What’s going to make the biggest difference in our daily lives as a result of this technology isn’t even the technology itself- it’s that for the first time, we as patients will be able to maintain our mobility and independence as we’re being monitored. This presumably could mean it would be easier to catch oncoming deficiencies before they manifest any symptoms, and the distance between the patient and her specialist would no longer be a hinderance to treatment.


Do you think this kind of technology would be useful in your own life, or do you think that a sensor monitoring your vital signs is just too “sci-fi” for your taste?


Related Stories on TakePart:


• Five Years Out of Juvenile Detention, Depression, Addiction Linger


• Researchers Are Closing In On Method to Predict Flu Outbreaks


• The Most Vulnerable Pay a High Price for Flu Infection



A Bay Area native, Andri Antoniades previously worked as a fashion industry journalist and medical writer.  In addition to reporting the weekend news on TakePart, she volunteers as a webeditor for locally-based nonprofits and works as a freelance feature writer for TimeOutLA.com. Email Andri | @andritweets | TakePart.com


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Official: North Korea could have U.S. within missile range

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SEOUL (Reuters) - This month's rocket launch by reclusive North Korea shows it has likely developed the technology, long suspected in the West, to fire a warhead more than 10,000 km (6,200 miles), South Korean officials said on Sunday, putting the U.S. West Coast in range.


North Korea said the December 12 launch put a weather satellite in orbit but critics say it was aimed at nurturing the kind of technology needed to mount a nuclear warhead on a long-range missile.


North Korea is banned from testing missile or nuclear technology under U.N. sanctions imposed after its 2006 and 2009 nuclear weapons tests and the U.N. Security Council condemned the launch.


South Korea retrieved and analyzed parts of the first-stage rocket that dropped in the waters off its west coast


"As a result of analyzing the material of Unha-3 (North Korea's rocket), we judged North Korea had secured a range of more than 10,000 km in case the warhead is 500-600 kg," a South Korean Defense Ministry official told a news briefing.


North Korea's previous missile tests ended in failure.


North Korea, which denounces the United States as the mother of all warmongers on an almost daily basis, has spent decades and scarce resources to try to develop technology capable of striking targets as far away as the United States and it is also working to build a nuclear arsenal.


But experts believe the North is still years away from mastering the technology needed to miniaturize a nuclear bomb to mount on a missile.


South Korean defense officials also said there was no confirmation whether the North had the re-entry technology needed for a payload to survive the heat and vibration without disintegrating.


Despite international condemnation, the launch this month was seen as a major boost domestically to the credibility of the North's young leader, Kim Jong-un, who took over power from his father who died last year.


Apparently encouraged by the euphoria, the fledgling supreme leader called for the development and launching of "a variety of more working satellites" and "carrier rockets of bigger capacity" at a banquet in Pyongyang on Friday which he hosted for those who contributed to the lift-off, according to North Korean state media.


(Editing by Jack Kim and Nick Macfie)



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Showrooming little threat to clothiers in ho-hum holidays

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Chicago (Reuters) – In retail, showrooming has not hit shirts yet.


Showrooming, the retail term for shoppers who try a product, then buy it cheaper on Amazon.com or other websites, has driven retailers to the point of hiding barcodes, improving their own websites and coming up with methods to get people to complete their purchase in the store.






But brand-name clothing retailers have an advantage over companies that sell items you can buy anywhere, like televisions and home goods.


Specialty apparel retailers are some of the least affected by showrooming since the more exclusive the product is, the harder it is to showroom,” said Joel Bines, managing director of the retail practice at advisory firm AlixPartners.


That, in turn, has helped retailers like Gap Inc and Lululemon Athletica Inc find favor with investors.


A survey of 2,010 adults conducted by AlixPartners showed consumers who shop for apparel were among the least likely (35 percent) to go to other websites after they liked an item at a store, compared with 42 percent of electronics shoppers and 41 percent of those looking for accessories like watches and jewelry.


“If you look at some of the most successful (clothes) companies in the past few years, they are those that have that moat around them,” said hedge fund manager Shawn Kravetz, who runs Esplanade Capital in Boston.


He cites yogawear maker Lululemon and Gap as good examples of how it can help to have clothes that are not sold elsewhere.


If a shopper wants to buy a Banana Republic or Nordstrom shirt from the latest season, they have to buy it either from their stores or online shop.


Discount retailers like Zappos, Amazon and others stock brand-name products, but the merchandise is often not from the current season or limited in colors and sizes.


“I don’t need to see if a television fits my body shape when I buy a TV,” said Joe Megibow, senior vice president of omni-channel e-commerce at American Eagle Outfitters. The teen clothes retailer has seen better sales than its peers over the past year.


“I can get a sense of the TV and I’m good. Clothing is different. Does it fit me, is it my style, do I like the quality of the material and how it is put together. There’s so much more with apparel that matters,” he said.


That is the part of the reason, analysts say, why online-only clothing companies like Bonobos and Gap’s Piperlime have started opening brick-and-mortar stores or tied up with retailers to sell their products in physical locations.


Choice and easy availability are the two most important aspects of shopping, especially during a holiday season that has lost steam after what looked like strong Thanksgiving sales.


Estelle Tran, an “impulsive” shopper in her twenties, agreed.


“If I want to buy books, tech items, DVDs, I would definitely buy online. For clothes, I would rather (visit stores) as it is also a fun experience to try on clothes,” said the Chicago-based finance auditor.


Tran said she would definitely check prices online if she was spending more than $ 100.


Luxury and high-priced items can be more susceptible to showrooming, because pricing is what drives the behavior, said Marshal Cohen, chief economist at the consultancy NPD Group.


“With electronics and certain consumer goods it is very easy to compare specific brands across multiple websites. But (showrooming is) happening and it will be growing. If a (clothes) retailer isn’t taking it seriously, they are going to fall behind,” said Bolette Andersen, principal in KPMG’s retail industry practice.


ROOM TO GROW


Some investors are betting on apparel stocks because of their relative insulation from the threat of showrooming.


While the S&P Apparel Index has returned a sizzling 27.71 percent year to date, according to Reuters data, far outperforming the S&P 500, which is up 14.80 percent, more gains may be coming.


“We still think there’s plenty of room to grow,” said Brian Peery, co-portfolio manager at Hennessy Funds. Its growth fund, heavily weighted in apparel and consumer discretionary goods shares, is up 30 percent over the year.


“As we look into the sector 12-18 months, we continue to buy the discretionary area. Two of our heaviest investments would be Foot Locker Inc and TJX Companies Inc,” he said.


Discount chains like TJX and Ross Stores, which sell branded clothes at low prices, have benefited from the surge in bargain-seeking shoppers.


Even the stocks of retailers like Gap and American Eagle that have staged or are staging turnarounds have gotten a good boost over the year. Gap has soared 69 percent and American Eagle is up 31 percent.


R. Shawn Neville, president of Avery Dennison retail branding and information solutions, said another reason that apparel and to a broader extent other consumer discretionary stocks do well is because of their sustainability.


“In uncertain times, investors look towards market segments that have strong underlying demand which are more stable, like the apparel industry,” Neville said.


Moreover, in times of economic uncertainty, shoppers can still afford clothes and shoes, as opposed to a new car, home, or expensive vacations, helping apparel stocks do well, he said.


“Though Amazon is clearly stealing some share in various categories, clothes retailers, say Abercrombie & Fitch isn’t going anywhere. They’re not being run out of the shopping mall,” said Esplanade’s Kravetz.


(Editing by Jeffrey Benkoe)


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Red Hat shares up on acquisition and 3Q results

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Red Hat Inc.‘s shares jumped Friday on the software company‘s solid third-quarter results and plans to acquire cloud-based software company ManageIQ.


THE SPARK: Red Hat said late Thursday that it would buy privately held ManageIQ for $ 104 million in cash.






The Raleigh, N.C., company also reported that it earned 29 cents per share for its fiscal third quarter on an adjusted basis, up a penny from the prior year and in line with analyst expectations. Its revenue for the period increased 18 percent to $ 343.6 million, which beats the $ 338 million that analysts polled by FactSet had forecast.


THE BIG PICTURE: ManageIQ’s software helps businesses deploy and manage private clouds. Red Hat said the deal will expand the reach of its public-private cloud setups for its customers. The acquisition is expected to have no material impact to Red Hat’s revenue for its fiscal year ending in February.


THE ANALYSIS: Stifel Nicolaus analyst Brad R. Reback said that the company has been able to maintain momentum even in a difficult environment and he thinks the latest deal offers an interesting longer-term angle for its business. He thinks the company is well positioned to generate at least 15 to 20 percent billings growth in the future. He reiterated a “Buy” rating and a $ 65 price target on its shares.


SHARE ACTION: Shares gained $ 2.25, or more than 4 percent, to $ 54.86 in afternoon trading. Shares have traded between $ 39.19 and $ 62.75 in the past 52 weeks.


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PSY’s ‘Gangnam Style’ reaches 1B views on YouTube

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NEW YORK (AP) — Viral star PSY has reached a new milestone on YouTube.


The South Korean rapper’s video for “Gangnam Style” has reached 1 billion views, according to YouTube’s own counter. It’s the first time any clip has surpassed that mark on the streaming service owned by Google Inc.






It shows the enduring popularity of the self-deprecating video that features Park Jae-sang‘s giddy up-style dance moves. The video has been available on YouTube since July 15, averaging more than 200 million views per month.


Justin Bieber’s video for “Baby” held the previous YouTube record at more than 800 million views.


PSY wasn’t just popular on YouTube, either. Earlier this month Google announced “Gangnam Style” was the second highest trending search of 2012 behind Whitney Houston, who passed away in February.


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Hep C cases linked to NH hospital worker rise

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CONCORD, N.H. (AP) — Five more people have been diagnosed with the same strain of hepatitis C a former traveling hospital worker is accused of spreading through tainted needles, bringing the total to 44 in four states.


David Kwiatkowski, whom prosecutors have called a “serial infector,” is charged with stealing painkillers from New Hampshire’s Exeter Hospital and replacing them with saline-filled syringes tainted with his own blood. He pleaded not guilty earlier this month to 14 federal drug charges and has been in jail since his arrest in July.






Thirty-two New Hampshire patients have tested positive for the same strain of the liver-destroying disease Kwiatkowski carries, and a dozen other cases have emerged in some of the 18 hospitals in seven states where he previously worked.


Maryland health officials announced four new cases on Friday, all involving patients at The Johns Hopkins Hospital, where Kwiatkowski worked from July 2009 to January 2010.


The previously reported cases include one from the Baltimore VA Medical Center and six from Hays Medical Center in Kansas. Another case has been confirmed at the University of Pittsburgh Medical Center in Pennsylvania, a hospital spokeswoman told The Associated Press this week.


Over the years, Kwiatkowski was fired twice over allegations of drug use and theft, including from UPMC, where he was just a few weeks into his temporary stint when a co-worker accused him of swiping a fentanyl syringe from an operating room and sticking it down his pants. Citing a lack of evidence, hospital authorities didn’t call police, and neither the hospital nor the medical staffing agency that placed him in the job informed the national accreditation organization for radiological technicians.


In Maryland, the Department of Health and Mental Hygiene said Friday that no drug diversion allegations involving Kwiatkowski were reported to the agency during his time there, but the five linked cases adds to the concern that such activity took place. The department expects to release a report early next year on potential vulnerabilities and steps to prevent future outbreaks.


Kwiatkowski was sent to Johns Hopkins by a staffing agency that assured the hospital it had followed a vigorous vetting process, hospital spokeswoman Kim Hoppe said.


“This includes a criminal background check, credentials and licensure verification, health and drug screening and two references,” she said. “In this case, none of the information that Medical Solutions provided about this health care worker suggested a history of drug diversion or any other criminal activity.”


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Parents hesitant about NRA armed schools proposal

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MIAMI (AP) — The nation's largest gun-rights lobby called Friday for the placement of an armed police officer in every school, but parents and educators questioned how safe such a move would keep kids, whether it would be economically feasible and how it would alter student life. Their reactions ranged from supportive to disgusted.


Already, there are an estimated 10,000 sworn officers serving in schools around the country, most of them armed and employed by local police departments, according to a membership association for the officers. Still, they're deployed at only a fraction of the country's approximately 98,000 public schools, and their numbers have declined during the economic downturn. Some departments have increased police presence at schools since last week's shooting rampage at a Connecticut elementary school that left 26 dead, but say they can only do so temporarily because of funding.


The National Rifle Association said at a news conference that it wants Congress to fund armed officers in every American school, breaking its silence on the Connecticut shootings. The idea made sense to some anxious parents and teachers, but provoked outright anger in others.


"Their solution to resolve the issue around guns is to put more guns in the equation?" said Superintendent Hank Grishman of the Jericho, N.Y., schools on Long Island, who has been an educator for 44 years. "If anything it would be less safe for kids. You would be putting them in the midst of potentially more gunfire."


Where school resource officers are already in place, they help foster connections between the schools and police, and often develop a close enough relationship with parents and children that they feel comfortable coming forward with information that could prevent a threat, said Mo Canady, executive director of the National Association of School Resource Officers.


But an Oklahoma educator who teaches at a school with armed officers described the NRA's proposal as a "false solution," though she's not opposed to the presence of more police.


"I teach at a school that has four armed police officers on campus every day, but it's more than a quarter of a mile from the main office to my room, and I'm not even the farthest room away," said Elise Robillard, a French teacher at Westmoore High School. "If (a student) put a loaded gun in their bag and came to my classroom and pulled it out and started shooting, by the time the police officer figured out what was going on and got to my classroom, we'd all be dead. This whole hallway could be dead before a policeman got here."


Around the country, school systems sometimes rotate armed officers through schools or supplement them with unarmed safety agents. New York City's school district is the largest in the country with more than 1 million students. The NYPD has 350 armed officers who rotate throughout the school system, and they're supplemented by unarmed safety personnel who also report to the department. In Philadelphia, school officials have rejected armed patrols in city schools and instead use unarmed school police.


In rural Blount County, Ala., a tobacco tax is used to fund a squad of nine armed sheriff's deputies and a supervisor who are assigned to work inside the system's 16 schools on a full-time basis, superintendent Jim Carr said Friday. They also assist in sports games and other after-school events.


An armed sheriff's deputy assigned to Columbine High School the day of the massacre there in 1999 was unable to stop the violence, though police procedures around the country have changed since then.


According to a Jefferson County Sheriff's Department report released in 2000, the uniformed sheriff's deputy was eating lunch in his patrol car at a park near the school when he rushed to the school in response to a radio report about the violence. The deputy briefly exchanged fire with one of the gunmen, but the gunman ran back inside the building to continue the rampage.


The officer radioed for assistance, and police followed the then-standard procedure of waiting for a SWAT team to arrive before entering the building. Since that tragedy, police procedures have been changed to call for responding officers to rush toward gunfire to stop a gunman first.


In his speech, NRA chief executive officer Wayne LaPierre said Congress should appropriate funds to post an armed police officer in every school. In the meantime, he said the NRA would develop a school emergency response program that would include volunteers from the group's 4.3 million members to help guard children.


The NRA's call came two days after a Kentucky county sheriff announced on Facebook that deputies would have an increased school presence beginning in January. The announcement was met with dozens of notes of thanks and positive comments from parents.


"Thank you so very much," wrote one commenter. "I can stop stressing a little while at work now."


"This is the best news we could have received for Christmas!" wrote another.


Monte Evans, a sixth grade teacher in Wichita, Kan., said schools should have a designated point person licensed and trained to shoot a gun.


"What am I going to stop them with? A stapler?" said Evans, an NRA member. "You need equal force."


Rose Davis, 47, who lives in Chicago's South Side Englewood neighborhood and helps care for her two young grandchildren, said she supports the idea of having armed police officers in schools. Her neighborhood is beset by gang violence and she worries about it spilling into schools.


"With the things going on today, you really don't feel secure," she said.


Even those who support the proposal, however, questioned how practical it would be.


"The real question is sustainability," said Ken Trump, president of the Cleveland-based consulting firm National School Safety and Security Services. "In the long haul, how are you going to fund that?"


But Randi Weingarten, president of the American Federation of Teachers, one of the nation's largest teachers' unions, called the NRA's idea "irresponsible and dangerous."


"Schools must be safe sanctuaries, not armed fortresses," she said.


Republican New Jersey Gov. Chris Christie said that posting armed guards outside schools wouldn't make classrooms safer or encourage learning.


"You can't make this (school) an armed camp for kids," he said.


Jacina Haro, a college educator from Malden, Mass., and the mother of two young children said the solution shouldn't be about having more weapons on campus.


"Schools shouldn't be about guns," said the 38-year-old. "It should be a safe place to learn, free from weapons and the like. I understand wanting to protect our children, but I don't know if that's the right solution. It's a scary solution."


___


Associated Press writers Frank Eltman in Mineola, N.Y.; Maryclaire Dale in Philadelphia; Barbara Rodriguez in Des Moines, Iowa; Jason Keyser in Chicago, Sean Murphy, Oklahoma City; Colleen long in New York; Colleen Slevin in Denver and Jay Reeves in Birmingham, Ala., contributed to this report.


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Kenya police: 28 people killed in clashes

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NAIROBI, Kenya (AP) — A police official says 28 people have been killed in clashes between farmers and herders in south-eastern Kenya.


Anthony Kamitu, who is leading police operations to prevent the attacks, said Friday that the Pokomo tribe of farmers raided a village of the Orma herding community, called Kipao, at dawn in the Tana River Delta.






The latest deaths in a tit-for-tat cycle of killings may be related to a redrawing of political boundaries and next year’s general elections, according to the U.N.


At least 110 people were killed in clashes between the Pokomo and Orma in September and October.


Animosity between the two communities over land and water resources has existed for decades.


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Insiders steal a march in leak prone Asian markets

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SINGAPORE (Reuters) – When South Korean automaker Hyundai Motor Co announced last month it had overstated the fuel efficiency levels on around one million of its cars in the United States and Canada some investors were left fuming more than others.


Some had already sold their shares before the announcement on November 2. The stock fell 4 percent on November 1 with about 2.2 million shares changing hands, the highest trading volume of the year at that point.






“This smells pretty bad,” said Robert Boxwell, director of consulting firm Opera Advisors in Kuala Lumpur who has studied insider dealing patterns.


“It would have fallen into our suspect trading category,” he added.


Boxwell spots suspect trading by looking at how much the volume diverges from the average level in the days before a market moving announcement. In the Hyundai instance, the volume was more than five standard deviations, a measure of variation, away from the daily average of 598,741 shares over the past year.


A Hyundai spokeswoman declined to comment.


Research from the Capital Markets Co-operative Research Centre (CMCRC), an academic centre in Sydney that studies financial market efficiency, found that 26 percent of price-sensitive announcements in Asia Pacific markets showed signs of leakage in the first quarter of this year, the most recent period for which data was available.


That compared with 13 percent in North American markets.


The CMCRC says it looks for suspected information leaks by examining abnormal price moves and trading volumes ahead of price-sensitive announcements.


Investors say one reason for leaks in Asia has been low enforcement rates for insider trading and breaches of disclosure rules. Enforcement in some markets is virtually non-existent.


There are also misconceptions about whether trading on non-public information is a crime.


“The idea that insider trading is wrong rather than smart is only being ingrained in the current generation of Asian players, not the older generation who are often still in the driving seat,” said Peter Douglas, founder of GFIA, a hedge fund consultancy in Singapore.


LOSS OF CONFIDENCE


Japan’s largest investment bank Nomura Holdings was embarrassed this year after regulatory investigations found it leaked information to clients ahead of three public share offerings.


Nomura has acknowledged that its employees leaked information on three share issues it underwrote in 2010. In June, it published the results of an internal investigation that found breaches of basic investment banking safeguards against leaking confidential information and announced a raft of measures to prevent recurrence.


The bank was also fined 200 million yen ($ 2.37 million) by the Tokyo Stock Exchange and 300 million yen by the Japan Securities Dealers Association.


Such leaks hurt companies’ share prices in the long run because investors put in less money if they feel they are not on a level playing field.


“It is very damaging. You may not know how much money you’ve lost but if there is not confidence that the regulators are prosecuting and enforcing the rules on this then it undermines investor confidence and liquidity,” said Jamie Allen, secretary general of the Asian Corporate Governance Association.


The issue isn’t being ignored. Many Asian markets such as Hong Kong and China have tightened their rules on insider trading over the past decade.


Indeed some investors feel that while leaks and insider dealing are unfair, regulators in the region have more serious issues they should be tackling.


“I would like to see the regulators spend more resources on investigating and prosecuting fraud against listed companies, which severely damages shareholder value,” said David Webb, a corporate governance activist in Hong Kong, arguing insider dealing as less of an impact on a company’s long-term share price.


HTC AND APPLE


A week after Hyundai’s announcement about its problems in the United States, there was an unexpected move on the Taiwan Stock Exchange.


Shares in smartphone maker HTC Corp jumped almost seven percent on Friday, November 9, hitting the daily upper trading limit. On Sunday came the surprise announcement that the company was ending its long-running patent dispute with Apple Inc , a move seen as a positive for the stock.


The Taiwan bourse announced it was investigating the trading patterns to see if there was a possible leak.


When asked for comment, HTC referred back to a November 13 statement in which the company said it had kept the Apple settlement process confidential and has strict controls on insider trading.


Michael Lin, a spokesman for the Taiwan Exchange, told Reuters on Friday that the bourse is still working with the regulator on the case.


‘ENORMOUS LOSSES’


Michael Aitken, who oversees research at the CMCRC, said many other Asian markets lack tough enough rules to force information to be released as efficiently and timely as possible, a primary reason for the prevalence of leaks.


“Poor regulation hampers enforcement efforts,” he said pointing out that few markets have the “continuous disclosure” rules used in Australia which require listed companies to release material information as soon as possible.


In Korea, when Hyundai shares started to fall, rumours began swirling that news about a problem with some of its cars was on its way, but investors say it took the company too long to disclose what exactly was happening.


“Hyundai at that time did not confirm the rumours. We suffered enormous losses because of this,” said one fund manager, who declined to be named because he was not authorised to speak to the media.


An official from Korea Exchange declined to comment on whether it was investigating this case, saying only that the exchange looks carefully into possible cases of insider trading.


Across Asia, regulators concede that many company executives and insiders still do not appreciate that leaking or trading on material, non-public information is an offence.


“People don’t even know they are engaging in insider trading, for example if their friends are talking about it on the golf course,” said Tong Daochi director-general for international affairs at the China Securities Regulatory Commission, during a regulation conference last month.


“We try to tell society, what are the criminal issues, what are the insider trading issues? For example we have held 27 press conferences to tell the public what kind of activities are involved in insider trading and to let people know that this is an active crime.” ($ 1 = 84.2600 Japanese yen) ($ 1 = 0.6147 British pounds)


(Reporting by Rachel Armstrong; additional reporting by Nishant Kumar in HONG KONG and Hyunjoo Jin in SEOUL; Editing by Emily Kaiser)


Wireless News Headlines – Yahoo! News





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