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Former Putin Aide Mikhail Lesin Found Dead in US Hotel

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A former aide to Russian President Vladimir Putin has been found dead in Washington DC, Russian officials say.

Putin Aide Mikhail Lesin Found Dead

Mikhail Lesin, 57, Russia’s former press minister and a one-time head of the powerful Gazprom-Media Holding group, died on Thursday, they said.

Russian media, quoting his family, said he suffered a heart attack.

The Washington Post quoted Russian embassy officials as saying Mr Lesin’s body was found in a room at the Dupont Circle hotel.

It reported that police were investigating the death of a man but that he had not yet been formally identified.

Last year, Mississippi senator Roger Wicker called for an investigation into Mr Lesin, saying his fortune “raises serious questions”.

In a letter to the US Department of Justice, Sen Wicker said Mr Lesin bought property worth $28m (£18.6m) in Los Angeles for his family after finishing work as a civil servant.

Sen Wicker asked how a former civil servant would have been able to buy and maintain expensive property, and expressed concern their purchase may have involved people and groups on a US sanctions list.

The Social Magazine  Russian said Mr Lesin was for a long time considered one of the most influential figures in the Russian media market and in the corridors of power.

Mr Lesin worked as an aide to the presidency between 2004 and 2009, when he helped advise on the creation of the news channel Russia Today.

Late on Friday, Mr Putin hailed “the enormous contribution made by Mikhail Lesin to the formation of modern Russian media”, according to Tass.

Last year, Mr Lesin was accused of trying to force a radio station in which he was a shareholder to cut an interview with opposition figure Alexei Navalny.

And Sen Wicker’s letter said Mr Lesin “led the Kremlin’s effort to censor Russia’s independent television outlets”.

He resigned from Gazprom-Media last year.

The Ria-Novosti agency said he leaves a wife, son and daughter.

US Fines Deutsche Bank $258m For Working With Iran

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German company Deutsche Bank has been fined $285m (£185m) by US regulators for working with US-sanctioned countries Syria and Iran.

US Fines Deutsche Bank $258m

The bank will pay penalties to the New York State Department of Financial Services and the Federal Reserve.

Employees who worked on the illegal transactions must not work with the bank again, the Federal Reserve said.

The bank also violated various New York state laws and is paying the two agencies separately.

“The firm did not have sufficient policies and procedures to ensure that activities conducted at its offices outside of the United States complied with US sanctions laws,” an official from the Federal Reserve said.

The Federal Reserve is requiring Deutsche Bank to create an “enhanced” programme to “ensure global compliance” with US sanctions, characterising its transactions with Syria and Iran “unsafe and unsound”.

The bank said in a statement that the conduct had stopped several years ago, adding: “Since then we have terminated all business with parties from the countries involved.”

Two French banks, BNP Paribas and Credit Agricole, received higher fines from the US for working with US-sanctioned countries.

The US fined BNP Paribas $8.9bn (£5.8bn) and fined Credit Agricole $800m (£516m).

US Fines Takata $70m Over Airbag Recalls

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A top US auto safety regulator has fined Takata Corp $70m (£45.4m) for its handling of defective airbag recalls.The Japanese manufacturer was also ordered to stop making the explosive-prone airbag inflators that are blamed for eight deaths and more than 100 injuries worldwide.

US Fines Takata $70m Over

The National Highway Traffic Safety Administration (NHTSA) has the authority to add as much as $130m (£84.2m) to the penalty, based on a five-year agreement with Takata.

A $200m (£129.6m) penalty would be the largest ever imposed, surpassing the record $105m fine levied against Fiat Chrysler in July for failing to report safety issues.

Under the terms of the agreement, Takata admitted it knew the inflators were defective, but failed to recall them in a timely manner.

Investigators said the airbags can inflate with too much force during a crash and shoot out metal shards.

High humidity was identified as being a primary cause of the airbag propellant becoming volatile, but the company and investigators have yet to discover the exact cause for the rupturing.

Since 2013, some 23.4 million airbag inflators have been recalled on 19.2 million US vehicles from 12 automakers.

Under the deal announced on Tuesday, Takata must adhere to a schedule for recalling the inflators “now on the roads, unless the company can prove they are safe or can show it has determine why its inflators are prone to rupture”, the NHTSA said.

Anthony Foxx, head of the US Department of Transportation, told a news conference: “Unless new evidence emerges, the company will have to recall all of its inflators.”

Senator Richard Blumenthal, of Connecticut, called the fine a slap on the wrist.

He said: “The penalty seems small compared to the consequences of the concealment and disregard” for the law.

The NHTSA said an independent monitor will make sure Takata abides by the terms of its agreement.

The company, meanwhile, still faces hundreds of lawsuit and a criminal investigation led by the US Justice Department.

US Manufacturing Grows At Slowest Pace in Two Years

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US manufacturing grew at its slowest pace in two years in October, according to data released by Institute for Supply Management (ISM).

US Manufacturing Grows At Slowest

The group reported a fourth consecutive month of declines in factory activity, with growth at its slowest pace since May 2013.

The index stood at 50.1. Any number above 50 is considered expansion.

The strong US dollar has hurt exports and caused a number of job cuts at plants across the country.

According to the ISM, the number of manufacturing jobs declined by 8% last month compared to September.

The index for new orders rose to 52.9 up from 50.1, suggesting the slowdown may end in the coming months.

A decrease in spending by the oil industry has also taken its toll on manufacturing and is likely to continue to do so, analysts said.

“Until oil prices rebound significantly and stay high for a while you’re unlikely to see a boost in their capital expenditures,” said Dan North chief economist for Euler Hermes North America, the largest provider of trade credit insurance.

Construction growth

He added that the strong dollar and global economic slowdown are also worrying for the industry.

“We expect that in the long term we will still have a strong dollar. Combine that with global weakness and our exports will still suffer,” Mr North said.

Separately, the US Commerce Department also reported a seven year high in construction spending.

It said that spending on new homes, highways, offices and other facilities was up 14.1% from the year before.

Both private and public sector spending was up.

Private home construction – the largest section of the industry- was up 17.2% compared to the previous year.

Amazon And eBay ‘Liable’ If They Ignore VAT Fraud

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Amazon and eBay could be liable for billions of pounds in unpaid VAT if they fail to properly investigate traders using their sites to escape sales tax, The Social Magazine has learned.

Amazon and eBay 'liable'

The online marketplaces could be legally required to spot the tax evasion committed by many of their overseas sellers.

UK firms say they are being put out of business by the unfair competition.

Amazon and eBay said they make all users aware of their legal obligations.

“If the scale of the fraud is as big as the anecdotal evidence indicates, then we could be talking about billions of pounds,” said Rita de la Feria, a professor in tax law at Durham University.

She says that under EU law Amazon, eBay and other online marketplaces could be held jointly liable for all unpaid VAT, along with the offending traders, if action was taken against them.

“If you knew that fraud was being committed you are liable,” she added. “If you should have known that fraud was being committed, you are liable as well.

“This principle means that someone like Amazon, someone like eBay can be de facto tax inspectors. Legally they are obliged to police this.”

The latest HM Revenue and Customs (HMRC) figures show that £13.1bn of UK VAT – about 11% – goes unpaid each year. That equates to 40% of the UK’s overall tax gap.

Not all of that missing money is down to online tax evasion, but it could make up a significant proportion.

Paul Miloseski-Reid has been the lead officer on e-commerce for UK Trading Standards for the last nine years. Based on an analysis of thousands of marketplace traders he estimates up to £2bn of VAT is being lost each year.

“The legislation provides a safe harbour defence for intermediaries, up until the point they become aware of that illegality,” he said.

“To keep that defence they need to demonstrate that they acted quickly to stop that illegality in the future. This could be an automatic solution where the VAT number given by the seller is automatically checked against the European database.”

But despite flagging up several seller accounts to eBay in 2011, Mr Miloseski-Reid says the problem persists.

“There’s been assurances given that they will tackle any sellers that are giving false VAT numbers or don’t have their VAT number registered on the system. It’s now 2015 and I still see some of the same problems.

“I would like to see more systematic changes in terms of verifying VAT numbers that make it impossible for businesses that are not properly VAT registered to trade on a marketplace.”

Both eBay and Amazon suggested the onus was on HMRC to find and prosecute tax evaders on their websites.

An eBay spokesman said: “eBay reminds all its users of their need to comply with their legal obligations. If eBay sellers are found to be breaching UK VAT compliance rules, we will cooperate with HMRC in all cases where HMRC provides evidence of underpayment of taxes.”

“Marketplace sellers are independent businesses responsible for complying with their own VAT obligations,” an Amazon spokesman added.

“We do offer tools and information to assist sellers with their compliance, but we don’t have the authority to review their tax affairs. Naturally we cooperate with HMRC as we are required to by law.”

HMRC wants to extend its powers to collect more data on companies and individuals it suspects of tax evasion. It has also said this would apply to “intermediaries”.

“HMRC will intervene to prevent, detect and stop fraud at the earliest stage,” a spokesman added. “We are developing better intelligence around the nature and scale of suspected fraud in this area.”

But struggling UK traders say not enough action is being taken.

Joe Mullins, manager at online retailer Safield Distribution, said the unfair competition from tax-evading sellers had seen their online sales fall sharply, particularly on Amazon.

The firm, which specialises in lighting products, moved into a new warehouse in Romford, Essex, a year ago.

“We thought we’d see a lot more growth this year than we have,” he said.

“If it continues then within the next couple of years it could be a case of having to look elsewhere for other jobs.”

Richard Allen, who successfully pressed for the closure a loophole allowing CDs and DVDs to be sold VAT free by Channel Island companies, is now campaigning for an end to tax abuse on online marketplaces.

“If you have a competitor that’s selling the same product as you with a 20% advantage, you cannot compete.

“So it is actually seriously dangerous for businesses in the UK, to the point where you could be wiped out over one Christmas.”

For the full report listen to today’s PM programme on The Social Magazine Radio 4.

Devastation At Egypt Jet Crash Site As 224 Killed

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Moscow has played down an Islamic State-linked group’s reported claim that it downed a Russian passenger jet in Egypt’s Sinai peninsula.

Devastation At Egypt Jet Crash

The Airbus A321 crashed into a mountainous area shortly after losing radar contact near cruising altitude, with all 224 passengers and crew thought to have been killed.

A statement attributed to the Wilayat Sinai (Sinai Province) group said: “The fighters of the Islamic State were able to down a Russian plane over Sinai province that was carrying over 220 Russian crusaders. They were all killed, thanks be to God.”

The statement was circulated on Twitter and also posted on the Aamaq website, which acts as a semi-official news agency for IS.

However, security sources in Egypt said an initial examination suggests the plane suffered a technical fault.

Russia’s transport minister also urged caution, telling the Interfax news agency the claims “can’t be considered accurate”.

It is unclear whether militants in the region would have the capability to attack the plane, which was flying at around 31,000ft.

The Airbus A321, operated by Russian airline Metrojet, took off from Sharm el-Sheikh shortly before 6am local time, bound for St Petersburg.

It disappeared from radar some 23 minutes into the flight. Data shows it was plunging 6000ft per minute before it lost contact.

The plane was found in the Hassana region, 22 miles (35km) south of Arish.

There were 214 Russians on board, three Ukrainians and seven crew members. Authorities say no one survived – despite earlier reports that voices had been heard from the wreckage.

At least 150 bodies, many of whom were still strapped to their seats, have been recovered so far, including five children.

German airline Lufthansa and Air France have halted flights over the Sinai peninsula until further notice.

There are “a lot of dead on the ground and many who died whilst strapped to their seats,” an Egyptian official told news agency Reuters.

He said the plane was split into two parts, “a small part on the tail end that burned and a larger part that crashed into a rock”.

Rescuers have found both black boxes, which could give vital clues about what happened.

In a statement, Metrojet named the pilot as Valery Nemov and said he had 12,000 hours’ flying experience, including 3,860 hours in the A321.

It also said the aircraft had received factory maintenance in 2014.

Russian President Vladimir Putin has announced a national day of mourning on Sunday and the country’s top investigative body, the Investigative Committee, is looking into the incident.

And Britain’s Foreign Secretary, Philip Hammond, has expressed his sympathies to his Russian counterpart, Sergei Lavrov.

“The British people who know and love Sharm el-Sheikh will be especially sad that what should have been a happy holiday trip has ended in such tragedy for so many families,” he said after their phone call.

Airbus said the plane was produced in 1997 and had accumulated some 56,000 flight hours in nearly 21,000 flights.

:: What Caused KGL-9268 To Plunge From The Sky?

According to Egyptian media, the pilot reported a technical failure shortly after take off and requested to land at a nearby airport, Sky’s Middle East correspondent Sherine Tadros said.

But Mike Vivian, former head of flight operations at the Civil Aviation Authority, told Sky News “hostile action” should not be ruled out.

“I am absolutely certain that will be one of the focuses of investigators on the ground,” he said.

Egypt’s North Sinai is home to a two-year-old Islamist insurgency and militants linked to IS have killed hundreds of soldiers and also attacked Western targets in recent months.

Several hundred relatives gathered at Pulkovo airport near St Petersburg after the crash, but many have now been taken to a nearby hotel.

Sky’s Moscow correspondent John Sparks says authorities have so far given relatives very little information.

One woman at the airport, Yulia Zaitseva, said her friends, a newlywed couple, were on the flight.

“We were friends for 20 years, ” said Ms Zaitseva. “She was a very good friend who was ready to give everything to other people. To lose such a friend is like having your hand cut off.”

Airbus To Expand A320 Production As Sales Ris

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European aircraft maker Airbus is planning to ramp up production of its A320 following a profitable third quarter earnings.

Airbus A320

Airbus increased revenue by 6% in the third quarter to €14bn (£10bn; $15.4bn) compared with €13.3bn the year before.

The company benefited from the strong dollar and growing sales across all its products.

Airbus plans to increase production of its A320 to 60 a month in 2019, from 42 now, capitalising on growing sales.

Shares in Airbus rose 4.6% in early trading following the news.

Operational challenges

The company’s order intake increased 42% in the first nine months of 2015 compared with a year earlier. Airbus did €100bn in sales of commercial aircraft and €4bn of helicopters sales.

The firm also announced a €1bn share buy back to be completed by mid-2016.

Airbus said the increased production of A320s would help off set some of the issues it has had delivering other aircraft.

In a statement, chief executive Tom Enders said “We are strongly focused on programme execution given our key operational challenges with the A350 and A400M ram-ups.”

Airbus has struggled to keep up with demand for its A350. Both the A350, and the A400M military aircraft, have carbon fibre structures that improve fuel efficiency.

Smart Car Software Tinkering Legal – US Ruling

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Security researchers have been given the green light to hunt for flaws in car software by US authorities.A ruling will allow users and expert analysts to carry out repairs. But changes such as extracting and selling code would still breach copyright.

Smart Car Software

Vehicle manufacturers opposed the move, saying repair garages could fix any issues.

The ruling follows claims the right to modify software could have prevented the Volkswagen emissions scandal.

The Library of Congress, which oversees the US Copyright Office, agreed with fair use advocates who argued that vehicle owners are entitled to modify their cars, which often involves altering software, Reuters reported.

‘Protection’

Manufacturers, including General Motors (GM) and Deere, spoke out in opposition. A GM representative referred to a statement from an industry group that said the new rules would weaken safety innovation.

“Sensitive vehicle data could be easily manipulated, altered, or distributed – undetected – if these changes are implemented,” the statement said.

Deere spokesman Ken Golden said the company stands by its earlier opposition. But he added that some systems that transmit data from the vehicle to Deere could still be protected by copyright.

Security researchers also pushed for copyright liability protection because computer programs are “pervasive” in modern machines and devices, including vehicles, home appliances and medical devices.

“We are pleased that analysts will now be able to examine the software in the cars we drive without facing legal threats from car manufacturers,” said Kit Walsh, a staff attorney for the Electronic Frontier Foundation (EFF), which advocated for the rule changes.

Serious reservations

In the wake of the Volkswagen emissions deceit, the EFF said car manufacturers’ software should not be protected from independent scrutiny.

“When you entrust your health, safety, or privacy to a device, the law shouldn’t punish you for trying to understand how that device works and whether it is trustworthy,” Walsh blogged. The new rules must be renewed in three years, he said.

Some US government agencies expressed serious reservations about the new rules, and the Environmental Protection Agency flatly opposed them.

“EPA explained that vehicle modifications are often performed to increase engine power or boost fuel economy, but that these modifications increase vehicle emissions and thus violate the Clean Air Act,” the Library of Congress said in its final rule.

However, the new rules do not allow vehicle owners to break any other laws, the Library said, and will not take effect for a year so the EPA and other agencies have time to prepare.

Apple Profits Up On iPhone Sales

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Apple reported a jump in sales in the three months to September.The tech giant’s revenue was $51.5bn, up 22% compared with the same period last year.

Apple profits up on iPhone sales

It sold over 48 million iPhones in the period, which it said were “record fourth quarter sales”, although the figure did miss analysts’ expectations.

It also reported a net income of $11.1bn for the period, adding that 2015 was its most successful ever year.

“The growth was fuelled by record fourth quarter sales of iPhone, the expanded availability of Apple Watch, and all-time records for Mac sales and revenue from services” it said in the earnings release.

Dave Lee, North America technology reporter, San Francisco

2015 has been Apple’s most successful year ever. Revenue is up 22% on 2014, mostly thanks to the continued success of the iPhone.

There are few surprises in these latest results – but a few interesting tidbits caught my eye.

Firstly, chief executive Tim Cook has said that as much as 30% of iPhone buyers are Google Android converts, the highest ever conversion rate.

Secondly, while it still feels like Apple sometimes favours its US customers with new features, it’s the international sales that are really giving it gusto: 62% of revenue was generated outside of the US this quarter. China accounts for a huge chunk of that – $12.52bn sales in the past three months, almost double what it took in from the country this time last year.

The iPad is still flagging, but that range will be given a shot in the arm by the upcoming iPad Pro.

Oh, and we still don’t know how many Apple Watches were sold in this quarter. Analysts put it at around 3.5 million. Still a tiny product line in Apple’s terms, but by far and away the most successful smartwatch on the market.

Apple Sued Over Wi-fi Assist Feature

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Apple is being sued for introducing a feature in its mobile operating system that uses mobile data when wi-fi coverage is weak.Wi-fi Assist first appeared in iOS9 and allows devices to automatically switch between wi-fi and mobile data.

Apple-iPhone

A class-action lawsuit filed in California alleged that some people had run up large mobile data bills as a result of the feature, which was enabled by default.

Apple declined to comment.

Wi-fi Assist is designed to give people a more seamless internet experience as they leave an area with wi-fi, or if the signal is weak.

By default, most smartphones exclusively use a wi-fi connection to access the internet if one is available – helping keep people within their mobile data allowance.

But prioritising wi-fi can result in periods of poor connectivity – for example when leaving home – while a smartphone judges whether the wi-fi is still available, before reverting to mobile data.

Some Android handsets have a similar setting, such as Samsung’s Smart Network Switch, which is switched off by default.

According to tech blog AppleInsider, the complainants filing the lawsuit said Apple had not properly explained the potential consequences of Wi-Fi Assist.

They alleged the “overall amount in controversy” exceeded $5m (£3.25m), because so many people could be affected.

Apple’s support website currently warns customers that they “might use more cellular data” if they leave the feature enabled.

“For most users, this should only be a small percentage higher than previous usage,” the website says.

“Apple could have put a pop-up notice on the phone to explain what had changed,” said Daniel Gleeson, mobile analyst at IHS.

“But you know as well as I do that nobody reads all those pop-ups when updating their device.

“Most Apple customers will be in a premium tier with a big data bundle, so the number of customers receiving bill shock should be quite small. But it could be a bigger issue internationally where more people use pre-paid tariffs.”