Kevyn Orr at news conference/Reuters

Kevyn Orr at news conference/Reuters

Orr wants $11 million a month released; about $170 million a year

Moratorium NOW, Voice of Detroit calling instead for cancellation of predatory billions in related debt to UBS AG and BOA

Sign petition to Justice Dept. for investigation of predatory UBS AG $1.5 billion POC loan

By Diane Bukowski

July 6, 2013

DETROIT —  Detroit Emergency Manager Kevyn Orr trumpeted July 5 that the city has won a “temporary restraining order” forcing U.S. Bank NA to release $11 million a month in casino taxes. According to the Wall Street Journal, this is part of his strategy to negotiate a deal with UBS AG and Bank of America Merrill Lynch to pay them 70 cents on the dollar for a related $340 million secured loan.  Orr thus left the impression that he is going to war against the banks, at the same time he is attacking the city’s pension funds and other assets worth billions more.

Moratorium NOW! protests Orr's meeting with creditors June 14, 2013.

Moratorium NOW! protests Orr’s meeting with creditors June 14, 2013.

The Moratorium NOW Coalition and the Voice of Detroit are calling instead for the complete cancellation of the related $1.5 BILLION pension obligation certificates (POC) loan from UBS AG and Siebert, Brandford and Shank brokered in 2005 by the city, plus billions more  in penalties, swap agreements including those with BOA, and Wall Street ratings downgrades.

Wayne County Circuit Court Judge Annette Berry temporarily granted the city’s request for release of the casino taxes during a hearing July 5. She ordered that US Bank NA’s insurer Syncora must “show cause” at a hearing July 26 before Judge Jeanne Stempien why the injunction should not become permanent.

Brogan Orr vulture“Syncora was interfering with the city’s ability to restructure,” emergency manager Orr said in published remarks. The city’s lawsuit says, “Syncora has asserted rights it does not have over collateral it does not need for the purpose of holding the City hostage for ransom.”

The Wall Street Journal reported July 5, “The city sees the insurer as a roadblock to a proposed deal to pay UBS AG and Bank of America Merrill Lynch more than 70 cents on the dollar on nearly $340 million in secured debt, according to people familiar with the matter. In exchange, the city would get back $11 million a month in tax revenue from the city’s three casinos originally used as collateral to back the debt.”

Moratorium NOW demands cancellation of Detrot debt to the banks May 9, 2012 after protesting at BOA.

Moratorium NOW demands cancellation of Detrot debt to the banks May 9, 2012 after protesting at BOA.

The WSJ article adds, “Mr. Orr has said Detroit needs significant and fundamental debt relief to shore up the city’s finances and avoid bankruptcy.” To read full WSJ article, click on Detroit Sues Bond Insurer Amid Effort to Reach Deal With Creditors WSJ 7 5 13.

Orr admitted in his “Proposal to Creditors” June 14 that ‘The City has identified certain issues related to the validity and/or enforceability of the COPS that may warrant further investigation.” COPS, or Certificates of Participation, is another term which refers to the POC loan.

 Sign petitionVoice of Detroit is calling for a federal investigation of the questionable circumstances under which the loan was negotiated, and has initiated a petition to the U.S. Justice Department at http://www.change.org/petitions/jeffrey-knox-usdoj-criminal-fraud-division-investigate-criminal-bank-ubs-ag-for-predatory-1-5-billion-loan-to-detroit.

Among various possibly criminal improprieties involved in the loan: then Detroit CFO Sean Werdlow took a top position with SBS shortly after the deal, and Wall Street ratings agencies Standard and Poor’s and Fitch came to the table to push for the loan, a blatant conflict of interest. The USDOJ has sued both UBS and Standard and Poor’s for fraudulent practices. It won a $1.5 Billion settlement from UBS and is suing S & P for $5 billion.

Meanwhile, Orr said he plans to take 25 of the city’s bank and insurance creditors on a D-DOT bus tour of the devastated neighborhoods of Detroit July 10, allegedly to pressure them to agree to lower their terms for debt repayment.

Abayomi Azikiwe, aof Moratorium NOW!, said earlier that the same banks are responsible for the condition of those neighborhoods.

Get on this bus instead!

Get on this bus instead!

“The banks destroyed the City of Detroit by foreclosing over 150,000 families in seven years,” Azikiwe said during a protest June 6 outside Greater Grace Temple, the site of Orr’s no-show public meeting. “They wreaked havoc and destroyed our tax base and our neighborhoods. We must have the complete elimination of fraudulent bank deals with the City. We don’t have decent buses, street lights and streets. Our schools are closed. The future holds nothing but more austerity and destruction. We built this city. We must demand no more payments to the banks.”

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Posted July 5, 10 A.M. by Christina Coleman for Global Grind Staff

After two weeks of intense testimony from witnesses, the state is expected to rest their case in the George Zimmerman second-degree murder trial and today the prosecution’s first witness was Sybrina Fulton, who when asked to identify her sons, strongly testified:

“My youngest son is Trayvon Benjamin Martin. He’s in heaven.”

Fulton went on to state that the screams heard on the 911 call are most certainly Trayvon Martin’s and furthermore and more highlights from the testimony include:

– Sabryna identifies Trayvon by telling court about his tattoos. Trayvon had two tattoos, praying hands and “my name” on his left wrist. The teenager was right-handed.

– Bernie de la Rionda plays the 911 tape with screams in the background. Asked if she can identify the screaming. “Yes, it’s Trayvon Benjamin Martin.”

– During cross examination, O’Mara tells Fulton that he’s sorry for her loss. BDLR objects.

– O’Mara questions Fulton about the first time she heard the tape. It was revealed that she wasn’t prepared for the screams when she first heard the tape with Trayvon’s father, Jahvaris Fulton, family lawyers, and mayor.

– O’Mara asks Fulton a series of questions about “hope.” She replies, “I don’t hope for anything.”

– During redirect, Fulton tells BDLR that what she hoped was that Trayvon was still here, alive.

Trayvon Martin’s brother, Jahvaris Fulton, also took the stand this morning. For more updates and livestream of the trial, click here and watch Sybrina’s heartbreaking testimony in the video above.

Read more: http://globalgrind.com/news/trayvon-martins-mother-sybrina-fulton-testimony-murder-trial-video#ixzz2YBVtqvt3

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Members of Kevin Carey's family who traveled from all over the U.S. for his homegoing ceremony: (l t r) cousin Torence Carey, sister Malanna Carey, sister Dr. Latanya Carey-Ledford, Bryant Carey, niece Danielle Ledford.

Members of Kevin Carey’s family who traveled from all over the U.S. for his homegoing ceremony: (l t r) cousin Torence Carey, sister Malanna Carey, sister Dr. Latanya Carey-Ledford, Bryant Carey, niece Danielle Ledford.

By Diane Bukowski

June 22, 2013

Kevin's friend Michael Harris, incarcerated for life. Harris was a co-founder of the People's Task Force.

Kevin’s friend Michael Harris, incarcerated for life. Harris was a co-founder of the People’s Task Force.

DETROIT — Members of Detroit Kevin Carey’s family traveled from all over the U.S. to join with dozens of Detroiters who fought in the trenches with Kevin for his people and all the oppressed for decades. During the memorial ceremony held at the James H. Cole Northwest Chapel, many took the mike to pay emotional, heartfelt and militant tributes to their friend.

Kevin passed away June 11, after a long battle with various illnesses. His friends and family said despite those illnesses, he kept on in the struggle. One friend said he told Kevin, who corresponded with and advocated for prisoners throughout Michigan, that there were 48,000 incarcerated in the state. He said he asked him whether he was going to fight for every one of them. Kevin responded with a firm “YES,” he said.

KCarey obit_0001

KCarey obit_0002

Kimberly Green protests Detroit EM Kevyn Orr's meeting with creditors at Wayne Metro airport June 14, 2013.

Kimberly Green protests Detroit EM Kevyn Orr’s meeting with creditors at Wayne Metro airport June 14, 2013.

Kevin’s obituary was read by his friend Kimberly Green. Green worked with Kevin on the Detroit People’s Task Force, set up several years ago by prisoners and their families to free those wrongfully incarcerated due to hundreds of errors made by Detroit’s crime lab. The crime lab scandal was broadly publicized in the daily media, as were protests led by the People’s Task Force. Eventually, the Task Force took on the cases of other prisoners as well, with the assistance of its legal staff Cornell Squires and Leonard Eston.

Marilyn Jordan demands freedom for her son Kelly Nobles during Task Force rally June 17, 2011.

Marilyn Jordan demands freedom for her son Kelly Nobles during Task Force rally June 17, 2011.

Along with Squires, Task Force President Marilyn Jordan was moved to tears when recounting the dedicated work Kevin did on behalf of prisoners. They included Jordan’s  son Kelly Nobles, incarcerated in 2002 on crime lab evidence Jordan says was falsified. Nobles just missed the deadline Worthy set for going back to review evidence in questioned cases.

Many spoke personally of Kevin’s warmth and caring for people, his sense of humor, his love for movies and the Detroit Tigers. Kevin’s father was a medical doctor in Detroit at a time when there was severe discrimination against Black doctors. His sister Dr. LaTanya Carey-Ledford, who coordinated the funeral ceremonies, carried on the family tradition. She said she graduated from Wayne State University’s Medical School and later practiced for many years at Detroit Receiving Hospital, then known as Detroit General before it was privatized in 1980.

Nelson Mandela, leader of South Africa and the ANC.

Nelson Mandela, leader of South Africa and the ANC.

Jerry Goldberg of Workers World Party recalled that Kevin worked on the campaign to free Nelson Mandela decades ago, before Mandela’s name was widely known. Members of the African National Congress came to Detroit for events Kevin and others planned, Goldberg said. Mandela is close to death himself now, after 28 years of incarceration by the apartheid South African regime, his victorious release, and his tenure as president of South Africa afterwards.

The chapel minister was visibly moved by the stirring tributes paid to Kevin, many of which exceeded the two-minute limit listed on the program. He concluded the ceremony with a comforting statement that even though warriors like Kevin may not live to see victory from their battles, they will live on when victories are achieved.KCarey obit_0003

 KCarey obit_0004

After the ceremony at James H. Cole Chapel, Kevin’s family and friends joined to celebrate his life at the Detroit headquarters of Workers World Party at 5920 Second. It was several hours before they finished getting to know each other, and reminiscing about Kevin’s life and love for the people.

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Related article by Michael Harris, one of the prisoners Kevin Carey corresponded with:


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PREDATORY LENDING: Jan. 31, 2004: Wall Street ratings agenices reps Joe O’Keefe of Fitch Ratings (speaking), and Stephen Murphy of Standard and Poor’s (to his left), foistied $1.5 BILLION loan on city of Detroit. Also shown in photo (l) then Detroit CFO Sean Werdlow, who left the Kilpatrick administation later that year to take a job with UBS ‘minority partner Siebert, Brandford & Shank as managing director, and (r) then Deputy Mayor Anthony Adams. Photo by Diane Bukowski

PREDATORY LENDING: Jan. 31, 2004: Wall Street ratings agenices reps Joe O’Keefe of Fitch Ratings (speaking), and Stephen Murphy of Standard and Poor’s (to his left), foistied $1.5 BILLION loan on city of Detroit. Also shown in photo (l) then Detroit CFO Sean Werdlow, who left the Kilpatrick administation later that year to take a job with UBS ‘minority partner Siebert, Brandford & Shank as managing director, and (r) then Deputy Mayor Anthony Adams. Photo by Diane Bukowski


 VOD requested investigation by USDOJ, no response yet

By Diane Bukowski

July 3, 2013

UBS CEO Sergio Ermatti

UBS CEO Sergio Ermatti

Voice of Detroit has submitted the following request to the U.S. Department of Justice for a criminal fraud investigation related to the 2005 $1.5 Billion Pension Obligation Certificates loan to the City of Detroit from bankers UBS AG and Siebert, Brandford and Shank. UBS AG has already paid $1.5 billion in fines to the USDOJ related to the LIBOR interest-rate rigging scandal. Additionally, executives from UBS/Japan have been criminally charged. The events detailed in this letter are similar to those which forced Chase Bank to forego 70 percent of the debt owed to it by Jefferson County, Alabama in their Chapter 9 bankruptcy filing. To date, we have received no response.

We have started a petition on Change.Org at http://www.change.org/petitions/jeffrey-knox-usdoj-criminal-fraud-division-investigate-criminal-bank-ubs-ag-for-predatory-1-5-billion-loan-to-detroit. Please click link and sign.

Jeffrey Knox, Chief USDOJ Criminal Fraud Division

Jeffrey Knox, Chief USDOJ Criminal Fraud Division

Jeffrey Knox/Denis J. McInerney, Chief Fraud Section and Daniel Braun, Deputy Chief

June 26, 2013

U.S. Department of Justice, Criminal Division Fraud Section
Bond Building, 4th Floor
10th and Constitution Ave. NW
Washington, DC 20530-0001


To Mr. Knox/McInerney and Mr. Braun, or others currently in place in the Fraud Section of the US DOJ Criminal Division:

I have reviewed your documents on the USDOJ website relating to agreements between the U.S. Department of Justice and UBS AG/UBS Japan, regarding the $1.5 billion fine exacted from UBS and criminal prosecutions of its executives, related to criminal fraud charges.

Former Mayor Kwame Kilpatrick and CFO Sean Werdlow.

Former Mayor Kwame Kilpatrick and CFO Sean Werdlow.

I am requesting, both as a newspaper editor and as a City of Detroit retiree who may have been adversely affected by possible criminal fraud perpetrated by UBS AG on the City of Detroit and its investors nationally, that your division launch an investigation into the following matters:

  1. On Jan. 31, 2005, the UBS AG and its minority partner, Siebert, Brandford & Shank, now known as SBS Financial, came to the Detroit City Council to obtain approval of a so-called “Pension Obligation Certificates” loan in the amount of $1.2 billion. The City Council approved that loan the next month after considerable controversy.
  2. At the time, Detroit’s Mayor was Kwame Kilpatrick, now serving time due to federal charges on other matters, and its Chief Financial Officer was Sean Werdlow. Werdlow was at the Council table advocating for the loan on behalf of Kilpatrick. Later that year, Sean Werdlow took a top manager position with Siebert, Brandford and Shank (now SBS Financial). He remains in that position to date.
    Standard and Poor's staff rings in Wall Street day.
    Standard and Poor’s staff rings in Wall Street day.
  3. Also at the City Council table advocating for the loan were Stephen Murphy of Standard & Poor’s and Joe O’Keefe of Fitch Ratings. They essentially backed the administration’s position that if the loan did not go through, the city would face massive lay-offs, and that its bond ratings would be downgraded. I am aware that the Justice Department has also sued Standard & Poor’s in another matter.
  4. In 2009, the City of Detroit defaulted on that loan, after the global economic collapse of 2008. To avoid paying the loan in total, its then Mayor Kenneth Cockrel, Jr. agreed to have the taxes collected from the city’s three casinos routed through a trustee, U.S. Bank NA, to ensure payment of the debt.  I am not aware of any reports issued by U.S. Bank NA recounting how it has distributed those funds. I am aware that the Securities and Exchange Commission has filed suit against U.S. Bank NA in another matter related to the collapse of Peregrine Financial.
    Kevyn Orr, Detroit EM
    Kevyn Orr, Detroit EM
  5. On June 14, 2013, City of Detroit Emergency Manager Kevyn Orr announced deliberate non-payment of $39.7 million due on the UBS loan that day. In a “Proposal to Creditors” issued that day, Mr. Orr stated, The City has identified certain issues related to the validity and/or enforceability of the COPS that may warrant further investigation,”  referring to the UBS AG loan as “Certificates of Participation,” another term for “Pension Obligation Certificates.” Standard and Poor’s and the other ratings agencies further downgraded the City’s bond ratings to the lowest of any major city in the country, creating further harm to the City and its investors 

    Attorney General Eric H. Holder Jr., right, and Lanny A. Breuer, the head of the Justice Department’s criminal division, announce criminal charges against two UBS traders.

    Attorney General Eric H. Holder Jr., right, and Lanny A. Breuer, the head of the Justice Department’s criminal division, announce criminal charges against two UBS traders.

Since the U.S. Justice Department, Criminal Fraud Division has found UBS guilty of fraud related to the LIBOR scandal (which likely also affects the City of Detroit), I am requesting that your office launch an investigation into:

  • UBS AG’s actions in the City of Detroit Pension Obligation Certificates loan.
  • The related actions of City officials including Kwame Kilpatrick and Sean Werdlow.
  • The actions of Standard and Poor’s and Fitch in advocating for that loan, which appear to have constituted a gross conflict of interest.
  • The actions of Emergency Manager Kevyn Orr and the city’s “debt re-structuring” consultants, the Jones Day law firm, in deliberately withholding payment on the UBS loan as part of an overall strategy outlined in their Proposal to Creditors. 

I have attached or linked various articles and documents related to this matter. I look forward to hearing from you in an expeditious manner. My contact information is below. 


Diane Bukowski

Editor, Voice of Detroit, LLC

City of Detroit retiree

Attached: Linked articles as below

















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Christina Livingston, a supporter of people who had lost their homes to foreclosure, or have been battling banks over loan modification, reacts to cheers from fellow protesters as she is arrested outside a Chase bank branch in downtown Los Angeles Thursday, Dec. 16, 2010.  Police arrested 22 protesters who blocked the doors to the bank in acts of civil disobedience.  (AP Photo/Reed Saxon)

Christina Livingston, a supporter of people who had lost their homes to foreclosure, or have been battling banks over loan modification, reacts to cheers from fellow protesters as she is arrested outside a Chase bank branch in downtown Los Angeles Thursday, Dec. 16, 2010. Police arrested 22 protesters who blocked the doors to the bank in acts of civil disobedience. (AP Photo/Reed Saxon)

VOD ED. NOTE: Detroit Emergency Manager Kevyn Orr announced a phony “debt moratorium” on the city’s creditors June 14, 2013. As explained in an earlier VOD article, these creditors are for the most part insured, as part of their loan agreements, at the city’s cost. Insurance companies will pay whatever Orr declares a “moratorium” on, such as the $37.9 million due to UBS AG on the $1.5 Billion pension obligation certificate (POC) loan he withheld June 14. The article below explains that Deutsche Bank will not lose out either in the $10 million lawsuit settlement with Los Angeles over foreclosues.)

By Edvard Pettersson – Jun 28, 2013 9:05 PM ET

Bloomberg News

Deutsche Bank AG (DBK) said servicers and securitization trusts will pay Los Angeles $10 million in a settlement of a lawsuit that had accused the bank of letting foreclosed properties in the city fall into disrepair.

“We are pleased that we could bring together the relevant parties to help facilitate a resolution of this matter for the City of Los Angeles,” Deutsche Bank said today in a statement.“As we have said from the outset, loan servicers are responsible for maintaining foreclosed properties.”

Los Angeles sued the Frankfurt-based bank in May 2011, after it, as trustee for mortgage-backed securities, acquired title to thousands of properties in the city that fell into foreclosure because of the collapse of the U.S. housing market. The bank didn’t admit liability or wrongdoing in the settlement, it said.

Deutsche Bank CEO Josef Ackerman

Deutsche Bank CEO Josef Ackerman

The city and Deutsche Bank obtained the agreement of the loan servicers that housing code enforcement agencies will have immediate access to people at servicing banks to address code violations, Los Angeles City Attorney Carmen Trutanich said in a separate statement.

“I want to thank Deutsche Bank for working with this Office to find a solution to a problem that has plagued this city for far too long,” Trutanich said.

The case is People v. Deutsche Bank National Trust Co., BC460878, Superior Court of California (Los Angeles).

To contact the reporter on this story: Edvard Pettersson in Los Angeles at epettersson@bloomberg.net.

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Voice of Detroit

July 1, 2013

Stephen White, center, with Milliman and DIFC officials in May, 2013 in Dubai.Detroit Emergency Manager Kevyn Orr announced a criminal investigation of Detroit pension funds June 21, 2013, citing $20,000 spent on a trip to Hawaii for a national pension conference among other alleged problems.

Meanwhile, his pension advisors, Milliman, Inc., who have called Detroit pension systems drastically underfunded (see article below), luxuriated in Dubai, the capital of the United Arab Emirates, at the Dubai International Financial Centre (DIFC). Above photo shows Milliman CEO Stephen White (center) and other Milliman officials with DIFC officials. Video above shows extreme wealth in Dubai.

The DIFC, founded in 2002, is an independent jurisdiction under the United Arab Emirates Constitution, and has its own independent civil and commercial laws. It also has its own courts, with judges taken from leading common law jurisdictions including England, Singapore and Hong Kong.

Dubai International Financial Centre.

Dubai International Financial Centre.

Dubai’s government is a constitutional monarchy, which has been ruled by the Al Maktoum family since 1833. The current ruler, His Highness Sheikh Mohammed bin Rashid Al Maktoum, is also the Vice President and Prime Minister of the United Arab Emirates and member of the Supreme Council of the Union (SCU).

The DIFC website at http://www.difc.ae/ says, “Attracted to the region by its growing wealth, cross-border trade and investment activity, M&A activity and ongoing restructuring by state owned enterprises, corporations and private entities, a large number of banks and brokerages have established a presence in DIFC.

. . . . Regional debt capital markets are also picking up as governments and corporates across the region diversify their funding bases they will need to resort more and more to capital markets to tap into private financing. Our legislative and regulatory regime has created a highly conducive and secure environment for the growth of banks offering a wealth of services.”

Below is press release from United Arab Emirates on Milliman:Brogan Orr vulture

Milliman, Inc. registers office at the DIFC to serve Middle East, Africa and South Asia

United Arab Emirates: Saturday, May 30 – 2009 

Press release

DUBAI — Milliman Inc. announced that it has registered an office at the Dubai International Financial Centre (DIFC) to serve the Middle East, Africa and South Asia region. 

The American-based firm offers a broad range of actuarial services. It brings its expertise with the aim to assist regional financial institutions and insurance companies in providing innovative products that simultaneously manage both investment and longevity risk.

Dr. Omar Bin Sulaiman

Dr. Omar Bin Sulaiman

Dr. Omar Bin Sulaiman, Governor of the DIFC, welcomed Milliman Inc to the DIFC and the region. “Milliman joins a long list of leading global institutions that have made the DIFC their home since we opened and we welcome them and offer all support to ensure their success in doing business in the region.” 

“Africa, Middle East, the Gulf and the Subcontinent region is bubbling with energy and vibrancy despite the ongoing global crisis and is poised to come out of it sooner and in better shape. This is evident in the shift of global commerce towards the East. It is a good time to focus on this region and we are sure that with the global expertise that Milliman possesses, it will do excellently and add value to the region,” Dr. Omar added.

Dubai at night.

Dubai at night.

Debo Ajayi, Managing Consultant and Director of Milliman in Dubai said: “Milliman’s wide range of talents and global experience are ideally suited to meeting client needs in the Middle East, Africa and South Asia. We will respond to the growing demand for customized solutions in the insurance and financial services areas.”

“Financial institutions have for years been under stress because of the twin threats of volatile capital markets and uncertain longevity trends, and the recent global financial crisis has compounded the situation. Many firms are now taking a new approach to risk management by offering retirement savings products with built-in guarantees.”

Invitation to 2009 Milliman conference in Dubai.

Invitation to 2009 Milliman conference in Dubai.

“The global expertise that Milliman has developed in guaranteed products and the sophisticated risk management systems and processes needed to manage them will become increasingly relevant as organizations in the Middle East look to enhance their retirement savings products,” he further said.

Milliman hosted a 1-day seminar on investment guarantees on 26 May in Dubai. The event, titled ‘Investment Guarantees: Managing Risk in Challenging Markets’, looked at the current state of the industry, examined some of the lessons learned in the wake of the recent financial crisis, and discussed future trends. The seminar compared and contrasted financial risk management practices in North America, Asia, and Europe, and discussed the potential to apply these techniques in the Middle East.

Burl Alab Royal Suite

Burl Alab Royal Suite

It also included an in-depth discussion of the global financial situation, an overview of promising risk management strategies, and the presentation of a case study highlighting the use of a capital guarantee, hedging, and a best-practices process to maximize portfolio performance.”

A travel site describes the Burj Al Arab, the hotel depicted in Milliman’s invitation above, which is known as the most expensive hotel in the world, as follows:

“The Burj al-Arab is a luxury hotel in Dubai, United Arab Emirates. At 321 metres (1,053 feet), it is the tallest building used exclusively as a hotel. It stands in the sea on an artificial island 280 metres (919 feet) away from the beach in the Persian Gulf, connected to the mainland only by a private curving bridge.

Portion of Burj Al Arab bathroom, complete with whirlpool tub.

Portion of Burj Al Arab bathroom, complete with whirlpool tub.

The Burj al-Arab does not have ordinary rooms; rather it is divided into 202 duplex suites. The smallest suite occupies an area of 169 square metres (1,819 square feet), and the largest one covers 780 square metres (8,396 square feet). It is one of the most expensive hotels in the world to stay in. The prices for the least expensive suites are in the range of $1,000 to over $6,000 a night. The most expensive suites can cost over $15,000 a night.”

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Protest outside Detroit EM Kevyn Orr's "public meeting" June 10, 2013.
Protest outside Detroit EM Kevyn Orr’s “public meeting” June 10, 2013.


  GRS logoGRS Review of Milliman’s City of Detroit Retirement System Studies

May 2, 2013

Gabriel, Roeder, Smith & Company (GRS) is the retained actuary for both the General Retirement System of the City of Detroit and the Police and Fire Retirement System of the City of Detroit. GRS is a Michigan based company with a national practice, and is a leader in Public Sector Retirement Consulting. Recently, the City of Detroit engaged Milliman, Inc., a Seattle based consulting firm, to perform certain actuarial analyses of the City of Detroit’s Retirement Systems in connection with the April 2012 financial stability agreement between the State of Michigan and the City of Detroit.

Child at protest outside CAYMA July 26, 2012.

Child at protest outside CAYMA July 26, 2012.

GRS performs an actuarial valuation of both Retirement Systems each year. The actuarial valuations develop the liabilities and funded ratios of the plans as of the valuation date. They also develop the City’s contribution rates for the fiscal year that starts one year after the valuation date, based on established funding policies. The reports typically present information that allows the reader to understand the extent to which contribution rates may be expected to increase (or decrease) in the future and may provide recommendations on the operation of the System.

An article in the February 26, 2013 Detroit Free Press “Police, fire pension costs could crush Detroit’s finances, study shows” asserts that Milliman has “audited” our 2010 valuation reports and found that “the GRS numbers … don’t hold water.” Milliman’s work for the City was confidential and not available to us or to the Retirement Systems at the time the Detroit Free Press article appeared. Consequently, our ability to respond was very limited. We have since obtained a copy of the study which was dated July 6, 2012 and have reviewed it. Nowhere does the study contain the statement that “the GRS numbers … don’t hold water.” The study does, however imply that our calculations may be biased and it contains the following statement on page 2:

Milliman offices

Milliman offices

“The following table contains our very rough preliminary guesstimates (“VRPG”) of the potential actual state of the [City of Detroit Retirement] systems. Please note that these VRPGs are based on a high level analysis using rules of thumb and knowledge from general experience are not based on any detailed calculations”

The study goes on to present figures that are remarkably different from the actuarial calculations that experienced public sector actuaries at GRS prepared using detailed data on the operation of the Systems and robust actuarial software. GRS work, which was not based on “VRPG”, complies with relevant pronouncements of the Governmental Accounting Standards Board (GASB) and actuarial standards of practice.

guesstimateDifferent actuaries can draw different conclusions from the same set of facts, just as different physicians could provide different advice to the same patient. While the Milliman firm is free to disagree with our analysis of the financial position of the City’s retirement systems, we believe that such disagreement must not be based upon VRPG and rules of thumb, but rather on detailed actuarial calculations performed by actuaries with significant experience with public sector retirement.

We are disappointed with the Detroit Free Press for publishing the “don’t hold water” comment, which was nowhere to be found in the Milliman report, and for not mentioning that all of Milliman’s figures were clearly disclosed as very rough preliminary guesstimates (“VRPG”). Indeed, Milliman’s report cautioned that “…any third party recipient of this report should be aided by its own actuary or other qualified professional when reviewing the report”.

We are also disappointed with Michigan’s Emergency Financial Manager (EFM) Law (PA 436), which adds power to the EFM in cases where a retirement system is less than 80% funded. First, the 80% figure itself is arbitrary. A system that is less than 80% funded can be in good financial condition and a system that is more than 80% funded could have problems.

Detroit Wastewater Treatment Plant workers and their children walked strike lines Sept. 2012.

Detroit Wastewater Treatment Plant workers and their children walked strike lines Sept. 2012.

Second, the law provides the Emergency Financial Manager with very different powers over a retirement system that is 79.9% funded versus one that is 80.1% funded, which can lead to distracting arguments over minor differences in judgment regarding actuarial techniques or assumptions that affect the computed funding level. Finally, the law potentially requires the exclusion of certain assets from the calculation of the funded percent that would not normally be excluded in valuations that comply with GASB standards.

The City of Detroit has well known and very significant financial problems. Those problems were caused by a loss of industrial tax base, a very large drop in the City’s population, and obviously the credit crisis. The City’s Retirement Systems in total have about half the active members they had in 1983 and approximately twice as many retired people as active members.

Result of bank/tax foreclosure tidal wave in Detroit: vacant lots, abandoned homes.

Result of bank/tax foreclosure tidal wave in Detroit: vacant lots, abandoned homes.

With the market value of Retirement System assets dropping, and the payroll and tax base already having dropped, there is indeed a risk that the contribution needs of the Retirement Systems may rise to levels as a percentage of payroll that will be difficult for the City to afford. Indeed, both Milliman and GRS have produced projections showing similar results regarding future contribution needs. This means that the issues that the Retirement Systems face are,  for the most part, a consequence of the City’s problems, and not a cause of those problems.

Contrary to the title of the Detroit Free Press article, it is not the Retirement Systems that will crush the City. Both the City and its Retirement Systems are being harmed by external forces.

The problems that the City and its two Retirement Systems face will not be solved with poorly conceived newspaper articles, VRPG’s, and secret reports that are not made available to the Retirement System or the Retirement System’s public sector actuary in a timely manner.

The problems can be solved with all parties working together in a spirit of cooperation and in an environment of transparency.

Twenty Thousand retirees depend on the Retirement Systems for their financial security. These are people who have devoted their entire lives to the people of the City of Detroit. They deserve our best.

Statement from the Police and Fire Retirement System of the City of Detroit regarding Pension Funding Levels. Continue reading

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June 26, 2013

Detroit City Council members who voted for the Consent Agreement April 4, 2012, on the anniversary of Dr. Martin Luther King, Jr.'s assassination.

Detroit City Council members who voted for the Consent Agreement April 4, 2012, on the anniversary of Dr. Martin Luther King, Jr.’s assassination.

(From VOD editor, not Independent Undergound News & Talk): What goes around comes around. Charles Pugh has been an enemy of the people of Detroit since he became a City Council member. He colluded with Gov. Rick Snyder, Mayor Dave Bing, and five other members of the City Council (Gary Brown, now an aide to EM Kevyn Orr, Saunteel Jenkins, James Tate, Kenneth Cockrel, Jr, and Andre Spivey) in composing and approving the Public Act 4 Consent Agreement April 4, 2012, which Orr says is now HIS “roadmap,” as well as harmful contracts.

Pugh forced Detroit citizens including Sandra Hines (r) and others to wait in hallway while Council discussed vital matters.

Pugh forced Detroit citizens including Sandra Hines (r) and others to wait in hallway while Council discussed vital matters.

The Sell-Out Six approved contracts with Jones Day, Miller Canfield, Milliman, Ernst & Young, and Miller Buckfire, all of whom helped Orr draft the devastating “Proposal for Creditors” presented June 14, 2013.

During Pugh’s tenure, he repeatedly gained the enmity of the public by refusing to hold Council meetings on such vital matters in the Auditorium, forcing seniors, disabled and others to wait outside in the hall to speak, and denying them access to the meetings, guaranteed under the Open Meeti.ngs Act. He also sits on the Root Cause Committee appointed to give advice on the Detroit Water & Sewerage Department along with Gary Brown. Both have signed on to documents recommending the EMA contract, which would eliminate 81 percent of jobs at DWSD, and regionalizing the Department. See links to VOD stories involving Pugh’s sell-out of the people below this article from Independent Undergraoud.)

Charles Pugh at Council meeting April 9, 2013 where protesters were arrested.

Charles Pugh at Council meeting April 9, 2013 where protesters were arrested.

DETROIT – –As Detroit’s Emergency Manager Kevyn Orr prepares to suspend City Council President Charles Pugh (D) without pay due to a request to take weeks of paid medical leave from his elected duties, local news station WDIV – Channel 4 latest report alleges Pugh’s absence might be tied to another reason.

Reporter Mara McDonald attended a press conference this evening with a local attorney alleging that Pugh, who is openly gay, [had an inappropriate relationship with] a former Detroit Public School student.

Legal counsel for the student, 17 years old at the time, claims the alleged behavior with the City Council President occurred when Pugh operated a mentoring program out of Douglass Academy [formerly Murray-Wright High School].

The teen’s attorney claims text messages exist quantifying an alleged relationship existed between Pugh and the former student.

“A Metro Detroit attorney representing an 18-year-old man and his mother claims Detroit City Council President Charles Pugh had an inappropriate relationship with a student at Douglass Academy.

The attorney says he will not provide copies of texts between Pugh and the teenager and was not willing to elaborate on what Pugh may have written to the teen. During a Wednesday press conference he did, however, say Pugh took the student off campus in a city car and bought him gifts.”

Students walked out of Douglass Academy last year to protest "inferior" education they were receiving under DPS EM Roy Roberts.

Students walked out of Douglass Academy last year to protest “inferior” education they were receiving under DPS EM Roy Roberts.

Officials from DPS Douglass Academy released a statement stating school officialS recently learned of the alleged inappropriate texts or relationship from the accuser’s mother.er. A press release statement by Douglass Academy personnel confirmed school personnel were working with the mother in an attempt to resolve the matter, WDIV reported.

“The mother of a recent Douglass Academy graduate approached the school with concerns regarding her son’s mentor. At the time, the school reached out to the parent who stated that she would prefer to handle the matter personally.

Family spokesman Skip Mongo (l) with attorneys for teen in lawsuit vs. Pugh,

Family spokesman Skip Mongo (l) with attorneys for teen in lawsuit vs. Pugh,

The school has since contacted the parent again in writing seeking to resolve the concerns, and is awaiting a response. The school and the district will fully review the program in question, as would be the case whenever concerns are expressed by a parent.”

The former student’s attorney also claimed to WDIV during this evening’s press conference Detroit Public Schools District did nothing to protect the boy, which DPS officials dispute.

Pugh has been absent from his duties on Detroit City Council for at least two weeks.

According to The Detroit Free Press, after Monday, June 24th formal council session Pugh’s office staff issued a memo stating the Council President would take medical leave for three to four weeks.

Detroit EM Kevyn Orr (r) with advisors (l-r) Bruce Bennett of Jones Day and Kenneth Buckfire during press briefing on Proposal for Creditors June 14, 2013.

Detroit EM Kevyn Orr (r) with advisors (l-r) Bruce Bennett of Jones Day and Kenneth Buckfire during press briefing on Proposal for Creditors June 14, 2013.

Emergency Manager Kevin Orr’s Spokesperson Bill Nowling told the Freep, Pugh would have until 5pm ET June 26th to further explain reasons surrounding his absence or be suspended without pay.

Presently, it’s unknown who will fill Pugh’s official duties on Detroit City Council as President. Pro-Tem President Gary Brown resigned from his duly elected position June 26th to take a role as Deputy Emergency Manager under unelected Emergency Manager Kevin Orr’s leadership.

WIth President Pugh’s pending suspension, Brown’s resignation and former member Kwame Kenyatta’s resignation from council due to health reasons, the City of Detroit’s legislative branch of government is down from nine to six members.

Independent Underground News & Talk offers developments on this story, as warranted.

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 Black Agenda ReportHow Complacency, Complicity of Black Misleadership Class Led to Supreme Court Evisceration of the Voting Rights Act


Bruce Dixon
Bruce Dixon


By BAR managing editor Bruce A. Dixon

June 26, 2013

Did the Supreme Court kneecapping of the Voting Rights Act have to happen?  Could black leadership have seen it coming and prevented it? Why didn’t they, and what can we do now?

(VOD note: The Jones Day law firm, the former employer of Detroit EM Kevyn Orr, and also made the city’s “debt re-structuring consultant” by the Detroit City Council, supported the stance of Shelby County in Shelby County v. Holder.)

Yesterday’s June 25 Supreme Court ruling tearing the guts out of the Voting Rights Act of 1965 should be a surprise to nobody. As recently as 2009, Chief Justice John Roberts telegraphed his specific intent to kneecap the Voting Rights Act by invalidating its enforcement formula.

U.S. Supreme Court Justice John Roberts

U.S. Supreme Court Justice John Roberts

Things have changed in the South. Voter turnout and registration rates now approach parity. Blatantly discriminatory evasions of federal decrees are rare. And minority candidates hold office at unprecedented levels…”

Enforcement of the Voting Rights Act rested on the history of open and legal Jim Crow in the south persisting right up until the 1960s, along with the enormous disparities between black and white voter registration and turnout. In 1965 for example, only 7% of African Americans in Mississippi were registered to vote, compared to 70% of whites.

Chicago's first Black mayor, the late Harold Washington, declares victory.

Chicago’s first Black mayor, the late Harold Washington, declares victory.

By the early 1980s, when black registration and turnout in Chicago for the first time surpassed that of whites, enabling the election of that city’s first black mayor, it might have dawned on some that the rationale for the Voting Rights Act stood on increasingly shaky ground. If and when black voter participation reached similar levels nationwide, the victory of voting rights would have to be consolidated, put beyond the reach of succeeding Congresses, judges and executives. The only way to do that is by amending the US Constitution to make the vote a constitutional right.

The argument for putting the right to vote in a constitutional amendment was best made by Frank Watson and Jesse Jackson Jr. in their 2001 book Toward a More Perfect Union. A constitutional voting rights amendment, specifying a citizen’s right to vote, they explained, would have far reaching consequences.

-A_More_Perfect_UnionIt would require the establishment of a uniform standard of who could register and how registration takes place, along with standards for how voting machines are procured, allocated and operated, and how votes are counted. A constitutional right to vote would provide easy grounds for removing corporate money and the contributions of wealthy individuals from political campaigns, ending felony disenfranchisement, banning gerrymandering, voter caging, discriminatory voter ID laws, and a thousand other ruses and schemes employed to keep minorities and the poor away from the polls and to minimize the effect of their votes when these are cast.

The Black Political Class Looks the Other Way

Amending the US Constitution however, is hard work, not for the lazy or faint of heart. It requires a two-thirds vote in both houses of Congress and ratification by 38 state legislatures, a herculean task unthinkable without the creation of a powerful grassroots movement, the like of which black leaders no longer knew how to build. On the positive side, opponents of such an amendment would be stuck having to explain why the right to vote should NOT be a constitutional right. But the negatives won.

Revs. Wendell Anthony Jeese Jackson, Al Sharpton

Revs. Wendell Anthony, Jesse Jackson, and Al Sharpton joined reactionary Detroit Mayor Dave Bing in leading Detroit “Freedom Walk” June 22, 2013 commemorating Dr. King’s 1963 Detroit march. Photo: Ken Snodgrass

The black political class instead crossed its fingers, complacently pretended the partial victory of the Voting Rights Act was “settled law,” and concentrated on boosting their own and each others’ illustrious careers, and ceaselessly commemorating the victories of the sixties, since beyond those careers there was little indeed to show.

I worked with Barack Obama in a 1992 Project Vote Illinois registration drive that signed up 130,000 new voters and flogged them out to the polls. President Clinton signed a Motor Voter registration law to make voter registration easier in the brief period he had a congressional majority, but dozens of state governments dominated by Republicans including northern states like Illinois refused to implement it.

By the late 1990s states like Florida were deploying legal barriers to the conduct of similar registration drives, such as levying huge fines on volunteer registrars for clerical errors and making mistakes on registration forms felonies. A decade later, the kinds of successful voter registration drives we conducted in Illinois in the 80s and 90s were legally impossible in much of the United States, thanks to nearly identical legislation introduced in state after state. A coordinated assault on voting rights was clearly underway. Alarm bells should have been ringing from one end of the black political class to the other, but the black political class was too lazy to hear them.

Senator Barack Obama on the Judiciary Committee

Justices Alito, Roberts

Justices Alito, Roberts

Barack Obama, whose first political act was the successful 1992 voter registration drive in Illinois, reached the US Senate in the 2004 election. It was the same year Florida officials repeated everything they’d done four years earlier to reduce the black vote, and the same year county officials in Ohio sent new and functional voting machines to their white suburban constituents, and old and defective ones to minority areas. Black voters had to stand in line 10 hours for a chance to vote.

A freshman senator, Barack Obama was assigned right away to the Foreign Affairs and Judiciary Committees, prestigious assignments coveted by senators of many years’ seniority. The Judiciary Committee interviews, questions, and passes or rejects all presidential nominations to the US Supreme Court. While Obama sat on that committee, the nominations of Samuel Alito for associate justice and John Roberts for chief justice were considered.

It was no secret that both Alito and Roberts were committed right wing extremists, and associated with the Federalist Society, a fraternity of lawyers founded in 1982 dedicated to repealing social security, the New Deal, antitrust law, the FDA, consumer protections and civil rights legislation of all sorts, basically civilized and civilizing reform passed in the 20th century. Though the Federalist Society does not disclose its membership, Roberts appeared in their 1997-98 leadership directory, and after his ascent to the high court, Alito has been an honored guest at more than one Federalist Society event.

Barack Obama was president of the Harvard Law Review as a student.

Barack Obama was president of the Harvard Law Review as a student.

As a former president of the Harvard Law Review, Senator Obama was intimately familiar with the goals and objectives of the Federalist Society. Grassroots Democratic activists besieged Senators Obama and Kerry, both on the Judiciary Committee, to vote against Alito and Roberts, if need be to lead a filibuster against them.

Obama and Kerry said just enough encouraging words to get the pressure off themselves, then repudiated the idea of a filibuster altogether. When the nominees came before the committee, they passed up the opportunity to grill them on their Federalist Society associations and what this might tell about their expected rulings from the bench on civil rights and other questions, opting to ask softball questions instead. Obama’s decision on the Senate Judiciary Committee not to fight, filibuster or meaningfully oppose the advancement of neo-segregationist Federalist Society thugs Alito and Roberts to the Supreme Court guaranteed the virtual nullification of the Voting Rights Act which has now occurred.

Slavemaster Mich. Gov. Rick Snyder goes after Michigan's majority-Black cities.

Slavemaster Mich. Gov. Rick Snyder goes after Michigan’s majority-Black cities.

By the time Barack Obama got to the White House the coordinated assault on voting rights took the form of ALEC-introduced voter ID laws. The Justice Department was slow, at best, at contesting voter ID laws, and paid no attention at all to state laws that criminalized voter registration drives such as the one the president once headed in Illinois. The rest of the black political class, following their president’s lead, did the same, and the rest is tragic history.

(VOD note: US Attorney General Eric Holder/Pres. Barack Obama did nothing to stop the attack on Black voting rights in Michigan, first under Public Act 4, and now under Public Act 436.)

The black political class, which was brought into existence by the voting rights act, has failed to protect its constituency, failed to protect even themselves. They possessed the moral high ground and the political initiative for a generation and squandered it through inattention and inaction. They spent more time celebrating the victories of the sixties than consolidating them, and we will all pay the price.

We can and must blame neo-segregationist Republican thugs in black robes for doing what they do.. That’s clear, cut and dry. But a large share of the blame in this week’s kneecapping of the Voting Rights Act also belongs to our lazy and complacent black political establishment, our black misleadership class, who lacked the vision to see this coming, or the courageous leadership to avoid it, or in most cases both.

It’s not too late to begin organizing for and demanding a constitutional right to vote, along with perhaps an amendment to take the rights of citizenship away from corporations. But we can’t expect any help from traditional black leadership on that one.

Bruce A. Dixon is managing editor at Black Agenda Report, and a member of the state committee of the Georgia Green Party.

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Protester Diane Wilson, who has been on hunger strike in solidarity with Gitmo prisoners, arrested on White House grounds June 26, 2013.

Protester Diane Wilson, who has been on hunger strike in solidarity with Gitmo prisoners, arrested on White House grounds June 26, 2013. Photo: CodePink

Protest supports 140-day hunger strike by Guantanamo prisoners

examiner logoBy: Deborah Dupre 


June 26, 2013

WASHINGTON, D.C. Wearing orange jumpsuits, dozens of human rights defenders were arrested in front of the White House today at a rally where their message to Barack Obama was loud and clear, “Close Guantanamo or have blood on your hands.”

Following police scuffles and first arrests during today’s Close Guatanamo Bay Prison rally at the White House, the number of arrests grew to dozens, according to CODEPINK’s tweet.

“Dozens of activists arrested in front of the White House now, demanding @BarackObama #CLOSEGITMO or the prisoners’ blood is on his hands!” tweeted CODEPINK, one of the groups collaborating with others for the rally.

Medea Benjamin thrown to the ground by police June 26, 2013..

Medea Benjamin thrown to the ground by police June 26, 2013..

Code Pink co-founder Medea Benjamin, who heckled Obama last month at his speech at the National Defense University, was violently thrown to the ground during the rally.

Today, June 26, is International Day for Survivors of Torture.

Benjamin said they decided to stage the protest today because she just returned from a visit to Yemen, where she “met with a lot of families who have their loved ones in Guantanamo,” she told ABC News.

“I heard just the saddest stories about how they’re giving up hope, about how their sons and their husbands haven’t eaten in months, about their sunken eyes and their shallow-looking faces, and that’s the sense of despair that these are men who have been cleared for release now for several years.”

Pres. Barack Obama:: torturer-in-chief?

Pres. Barack Obama:: torturer-in-chief?

The Guantanamo Bay prisoners of war have been on a hunger strike for 140 days.

Diane Wilson, who jumped the White House fence and was immediately arrested, has been on a water-only hunger strike for 57 days in support of the detainees’ hunger strike.

She was arrested by a Secret Service swat team armed with automatic weapons and a german shephard.

Soon after Wilson’s arrest, about 20 more activists were arrested in front of the White House. According to CODEPINK’s tweet, that number rose to dozens.

Prisoner at Gitmo.

Prisoner at Gitmo.

Activist Kevin Zeese gave an analysis of the demonstration, saying that he holds Barack Obama responsible for Guantanamo and labeling him “a torturer-in-chief.”

CODEPINK and other rights groups participated in Wednesday’s rally to draw attention to the plight of 104 hunger striking Guantanamo detainees, most held without charges and most being tortured daily through force-feeding.

“(Obama) likes to blame Congress but really, as commander-in-chief, he has a lot of authority that he’s not using,” Benjamin said.

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Obama crimes against humanity victims’ voices amplifying

Gitmo protesters outside White House June 26, 2013.

Gitmo protesters outside White House June 26, 2013.

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