More to Petraeus story than meets the eye

It's the soap opera that shocked official Washington and ensnared a previously squeaky clean CIA director at a time when he was supposed to play a role in the accounting for a possible security misstep in Libya.

We don't know all the facts of why the FBI started investigating David Petraeus' biographer and how it ultimately led to his resignation.

But a growing number of conservative commentators contend that the resignation of former CIA Director David Petraeus is more than simple amends made for a personal wrong.

Charles Krauthammer, the Fox News and Washington Post commentator, believes the Petraeus' sex scandal is linked to a closed briefing that he gave two days after the attack that killed four Americans, including Ambassador Chris Stevens, in Benghazi, Libya.

Petraeus is set to speak about circumstances surrounding the tragedy again before a House committee on Friday and possibly at a Senate Intelligence Committee hearing, as well.

Petraeus' resignation from his post at the CIA in light of his extramarital affair raised the possibility that he would not testify. But on Wednesday morning, Sen. Dianne Feinstein, D-Calif., told ABC News Petraeus had agreed to do so.

Krauthammer said on Fox News Tuesday that ties he sees between what Petraeus' told the Congress in September and his fear for his future at the CIA make his affair with biographer Paula Broadwell important to the public.

"The reason that it's important is here's a man who knows the administration holds his fate in his hands, and he gives testimony completely at variance with what the Secretary of Defense had said the day before, at variance with what he heard from the station chief in Tripoli and with everything that we had heard," Krauthammer said. "Was he influenced by the fact he knew his fate was held by people in the administration at that time?"

Krauthammer's comments seemed to imply that the man who wrote the book on the wars in Afghanistan and Iraq lied to the House Intelligence Committee to save his skin when he said that the attack was a spontaneous mob spurred by the film, "The Innocence of Muslims."

At the time of his briefings, no one in the White House was aware of the FBI investigation into Petraeus' relationship with Broadwell.

As ABC News' Martha Raddatz reported on "World News with Diane Sawyer," the FBI got involved around May or June tracing emails from Broadwell to Jill Kelley in Tampa, Fla., but President Obama was not informed about Petraeus' indiscretions until November

Former New Jersey Superior Court Judge Andrew Napolitano wrote an op-ed for the Washington Times Wednesday in which he said Petraeus was clearly forced to resign his post in an effort to keep him quiet.

"In the modern era, office-holders with forgiving spouses simply do not resign from powerful jobs because of a temporary, non-criminal, consensual adult sexual liaison, as the history of the FDR, Eisenhower, JFK, LBJ and Clinton presidencies attest. So, why is Gen. Petraeus different?" Napolitano wrote. "Someone wants to silence him."

Napolitano offered no guesses as to what those pressuring Petraeus might be hoping to suppress.

Rudy deLeon, senior vice president for national security and international policy at the Center for American Progress, said the American people should allow Petraeus to "speak for himself."

"Anyone who knows Gen. Petraeus, and I've known him since my Pentagon days, knows that his integrity comes first, that he's not a political guy, and that being straightforward is what his considerable reputation has been based on," deLeon said.

In late October, Petraeus personally traveled to Libya to investigate the CIA personnel who were in Benghazi on the night of the attack.

Read more about that trip  HERE.

On the night Petraeus first announced his resignation, Krauthammer said the affair would spur the mainstream media to dig deeper into what transpired in Benghazi.

"It will now become the hottest story around and you can be sure that even the mainstream papers, which did not show any interest whatsoever in this story up to and into the election, are going to get on it," Krauthammer said. "It will unravel."

Implications that Petraeus was covering for the White House play into a larger theory floating around conservative circles that Obama administration officials like Petraeus and U.N. Ambassador Susan Rice purposely misled the American people following the attack in Benghazi.

Sens. Lindsey Graham, R-S.C., and John McCain, R-Ariz., told ABC's Jon Karl Wednesday that they would oppose Obama's hypothetical nomination of Rice to Secretary of State, with Graham saying he didn't "trust her."

President Obama responded to this opposition Wednesday at his first press conference since taking reelection, defending the U.N. ambassador.

"She made an appearance at the request of the White House in which she gave her best understanding of the intelligence that had been provided to her," Obama said. "If Sen. McCain and Sen. Graham and others want to go after somebody, they should go after me."

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Beating tax cheats key to Italy’s recovery plan

ROME (AP) — Good plumbers may be worth their weight in gold, but when one was spotted zipping around in a bright red Ferrari, Italian tax police were fast on his trail.

Stamping out entrenched tax evasion is crucial to Premier Mario Monti‘s quest to keep Italy from succumbing to the European debt crisis, and it is critical to fellow eurozone members in more dire straits, such as Greece and Spain — which are also notorious for making cheating the taxman a way of life.

Indeed, Greece’s international rescue creditors have been pressing Greece for two years to reform its ailing tax system, citing poor collection as a key factor keeping the country mired in crisis. In Spain, where tax fraud is rampant, as much as €90 billion ($ 150 billion) is lost each year to tax fraud — the equivalent of the country’s national debt, according to Spain’s main tax inspectors union.

To succeed in Italy, authorities will have to catch the legions of self-employed and small business owners who brazenly lie about their earnings, like the plumber in the eastern town of Pescara, who socked away undeclared income in 30 bank accounts, or a successful pastry shop owner in Calabria, who on his tax return claimed he was earning next to crumbs.

And those are the less sophisticated schemers.

Tax police officials say that wealthy Italians, their companies and foreigners who make their money in Italy are increasingly trying to avoid taxes by using such strategies as falsely declaring that their base of operations or residence is abroad.

Another daunting challenge is the so-called “submerged” economy, a term embracing Italians who declare only a fraction or nothing at all of their earnings — and dentists, lawyers, doctors and other big-earning professionals are frequently among the worst offenders.

Tax evasion of all types in Italy totals about euros 240 billion ($ 300 billion), or 15 percent of the country’s gross domestic product of €1.6 trillion ($ 2 trillion), tax police estimate. Winning the war on tax cheats could therefore more than wipe out the country’s budget deficit, which is expected to increase to euros 42 billion ($ 53 billion), or 2.6 percent of GDP this year. That would start knocking away at the nation’s colossal public debt of €2 trillion ($ 2.5 trillion), or 125 percent of GDP.

But “big international frauds are up,” lamented Lt. Col. Gianluca Campana, in charge of the income tax unit revenue protection office at the Guardia di Finanza, Italy’s financial police corps which reports to the Economy Ministry.

The entrenched practice by many cafes, eateries, hair dressers and similar small business of neglecting to give customers mandatory cash register receipts commonly grabs the attention in crackdowns on tax evasion in Italy.

But, cautioned Campana, “one false (big business) invoice can equal no cash register receipts for coffees for two months.”

Over all of 2011, the total of non-declared income discovered by tax police amounted to some €50 billion ($ 65 billion), of which some 20 percent was due to international tax evasion, he said. By comparison, in the first nine months of this year, tax police discovered some €40 billion in undeclared income, with 30 percent of that blamed on international tax evasion, Campana said.

With the economic crisis shrinking bottom lines, and Italy increasingly on the hunt for big-time evasion, especially by big businesses, “there is a tendency to move capital abroad, using maneuvers apparently legal but which really are not,” Campana said. A classic technique consists of declaring one’s formal residence abroad in tax havens like Monte Carlo. Also common are companies that clearly have their business base in Italy but claim it is abroad in countries with far lower tax brackets.

Campana is armed with three degrees, including a masters in tax law from Milan’s Bocconi University, the prestigious economics institute formerly headed by Monti. He brings skills to this specialized police corps that are as finely tuned as sharp-shooting.

“We are going after the big cases (of evasion) in order to rake in more money,” Campana said.

The Ferrari-driving plumber hid some €2 million ($ 2.6 million) of his income over several years by giving his customers invoices — for jobs ranging from fixing leaks to installing new bathrooms — for the actual cost of his work, but kept a second, false registry of much lower figures for tax purposes, said Pescara tax police Col. Mauro Odorisio.

Armed with a 2008 law, authorities confiscated assets belonging to the plumber equivalent to the approximately €1 million ($ 1.3 million) they contend he owed in taxes, Odorisio said.

With Ferraris in red or yellow, and snazzy Porsches parked inside, Guardia di Finanza garages practically resemble luxury car dealerships.

The cars get sold to help recoup unpaid taxes and interest.

Overall, tax revenues in Italy were up by 4.1 percent, says the Economy Ministry, when comparing figures from the first eight months of 2012 with the same period in 2011, but much of that was due to new taxes, and not necessarily a revolution in citizens’ consciences about tax obligations.

Monti’s recipe relies heavily on taxes that are nearly impossible to avoid, such as sales tax. He also revived a property tax that his populist predecessor, Premier Silvio Berlusconi, had abolished in a promise to voters.

The ministry’s report last month noted that the property tax figured prominently in the “tendency toward growth” in tax revenues. But sales tax revenue dropped slightly despite higher sales tax rates, indicating that consumers were feeling the pinch of the stagnant economy.

The heavier fiscal burden seems to have driven some honest citizens to rebel against the engrained culture of tax evasion.

The number of phone calls from the public to the tax police’s hotline to report stores, restaurants and other businesses that didn’t give customers sales receipts has almost doubled in the first nine months of this year, compared with the same period in 2011.

It’s apparently dawning on Italians that shirking taxes in the end only costs them, in terms of ever-higher levies and cutbacks in public services.

Citizens now increasingly understand that “the lack of revenue over time caused by tax evaders forced the government to stiffen the tax burden on categories where you can’t evade taxes,” Campana said, referring to workers whose taxes are deducted from paychecks. Another area where evasion is close to impossible is real estate ownership.

Odorisio noted the crackdown included extending the statute of limitations on tax evasion from six to eight years and establishing prison as a penalty for big-time evasion.

Other weapons include a measure promoted by the Monti government that limits cash payments to no more than €1,000. Paying by credit card or personal check is a relatively new habit for Italians, who are used to carrying wads of cash in their pockets, even for big-ticket items like home renovations or vacations.

Past governments in Italy sometimes resorted to tax amnesties to try to boost revenues. But critics, contending some Italians counted on such a possibility, described that strategy as only perpetuating the tax cheat culture.

Spain hasn’t had much success with its own tax amnesty introduced by the conservative government in March. That measure, expiring soon, allows undeclared assets or those hidden in tax havens to be repatriated by paying a 10 percent tax without criminal penalty. The amnesty is estimated to recuperate far less than the expected €2.5 billion ($ 3.25 billion).

Greece saw demands for tax system reform from international rescue creditors added on to conditions for future rescue loan payments, as Greek authorities acknowledged that a high-profile campaign to crack down on major tax cheats has produced disappointing results.

The cash-strapped government over the last 10 months recovered just €19 million ($ 25 million) of the €13 billion ($ 17 billion) of arrears on the list. A prominent Greek magazine publisher recently tapped anger over rich tax evaders by publishing a list of people allegedly holding Swiss bank accounts. He was acquitted this month of breaching privacy laws.

Meanwhile, Italian tax police are chasing after cheats who have shown some of the most chutzpah about not paying their fair share of taxes, like the Padua woman who advertised on the Internet that she had a couple of “cash-only” bed and breakfast rooms to let.

Tax police discovered the lodgings are part of an apartment in public housing she was given after falsely declaring she was indigent on her annual tax forms.

____

AP reporters Derek Gatopoulos in Athens and Ciaran Giles in Madrid contributed to this report.

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Facebook stock up as lock-up expires on largest block of shares

SAN FRANCISCO (Reuters) – Shares of Facebook Inc jumped 10 percent in early trading on Wednesday, even as the biggest block of shares held by insiders became eligible for sale for the first time since the social media company’s disappointing debut in May.

In heavy morning trading, Facebook gained $ 2.02 to $ 21.89.

“While the lock-up is expiring, there is nothing requiring anybody to sell,” said Tim Ghriskey, chief investment officer at Solaris Group in Bedford Hills, New York. “Given the low price, these long-term holders are deciding to hold the stock and that is lifting it here as the fear of the expiration subsides.”

Roughly 800 million Facebook shares could begin trading on Wednesday after restrictions on insider selling were lifted on the biggest block of shares since the May initial public offering.

The lock-up expiration greatly expanded the 921 million-share “float” available for trading on the market until now.

Facebook, the world’s No. 1 online social network, became the only U.S. company to debut with a market value of more than $ 100 billion. But its value has dropped nearly 50 percent since the IPO on concerns about its long-term money-making prospects.

Insider trading lock-up provisions started to expire in August, and the rolling expirations have added to the pressure on Facebook’s stock.

Pivotal Research Group analyst Brian Wieser said he didn’t expect Facebook insiders to sell all of their shares as the lock-ups expired.

“I would expect heavy volumes over the next few weeks, but not undigestible volumes,” said Wieser. By his estimates, roughly 486 million of the nearly 800 million newly freed Facebook shares will be sold.

There is some evidence that the heavy interest in shorting the stock was dissipating, given the poor performance since it first sold shares in May.

According to Markit’s Data Explorers, about 28 percent of the shares available for short-selling were being borrowed for that purpose, down from a high of more than 80 percent in early August.

Similarly, SunGard’s Astec Analytics, which also tracks interest in shorting, noted in a comment on Tuesday that the cost of borrowing Facebook shares is down more than 50 percent since the beginning of the month.

“Everything would seem to indicate the market is losing its appetite to short Facebook,” wrote Karl Loomes, market analyst at Astec.

Several members of Facebook’s senior management have sold millions of dollars worth of shares in recent weeks through pre-arranged stock trading plans as lock-up restrictions expired.

Chief Operating Officer Sheryl Sandberg has sold roughly 530 million shares this month, netting just over $ 11 million, though she still owns roughly 20 million vested shares in Facebook.

In August, Facebook board member Peter Thiel sold roughly $ 400 million worth of Facebook stock, the majority of his stake, when an earlier phase of lock-up restrictions expired.

Facebook’s 28-year-old chief executive, Mark Zuckerberg, has committed to not sell any shares before September 2013.

(Reporting by Alexei Oreskovic; Editing by Jeffrey Benkoe)

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Actor Channing Tatum dubbed People’s sexiest man alive

NEW YORK (Reuters) – Actor Channing Tatum, who set female hearts fluttering in the summer movie hit “Magic Mike”, was named the sexiest man alive by People magazine on Wednesday.

“My first thought was, ‘Y’all are messing with me,” Tatum told the magazine after hearing the news.

The 32-year-old actor, who is married to actress Jenna Dewan-Tatum, is training to play an Olympic athlete in his upcoming film, “Foxcatcher”.

The couple, who have been married since 2009, are ready to start a family, according to People.

“The first number that pops into my head is three, but I just want one to be healthy and then we’ll see where we go after that,” he told the magazine.

Tatum joins a long list of Hollywood heartthrobs who also have also received the “sexiest man” title from the magazine including Brad Pitt, Johnny Depp, Ryan Reynolds, George Clooney and Matt Damon.

(Reporting by Patricia Reaney; Editing by Maureen Bavdek)

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Ireland probes death of ill abortion-seeker

DUBLIN (AP) — The debate over legalizing abortion in Ireland flared Wednesday after the government confirmed that a miscarrying woman suffering from blood poisoning was refused a quick termination of her pregnancy and died in an Irish hospital.

Prime Minister Enda Kenny said he was awaiting findings from three investigations into the death of Savita Halappanavar, a 31-year-old Indian who was 17 weeks pregnant. Her case highlights the bizarre legal limbo in which pregnant women facing severe health problems can find themselves in predominantly Catholic Ireland.

Ireland’s constitution officially bans abortion, but a 1992 Supreme Court ruling found the procedure should be legalized for situations when the woman’s life is at risk from continued pregnancy. Five governments since have refused to pass a law resolving the confusion, leaving Irish hospitals reluctant to terminate pregnancies except in the most obviously life-threatening circumstances.

In practice the vast bulk of Irish women wanting abortions, an estimated 4,000 per year, simply travel next door to England, where abortion has been legal on demand since 1967. But that option is difficult, if not impossible, for women in failing health.

University Hospital Galway in western Ireland declined to say whether doctors believed Halappanavar’s blood poisoning could have been reversed had she received an abortion rather than wait for the fetus to die on its own. In a statement, it described its own investigation into the death, and a parallel probe by the national government‘s Health Service Executive, as “standard practice” whenever a pregnant woman dies in a hospital. The Galway coroner also planned a public inquest.

Savita Halappanavar’s husband, Praveen, said doctors determined she was miscarrying within hours of her hospitalization for severe pain on Sunday, Oct. 21. He said that over the next three days doctors refused their requests for an abortion to combat her surging pain and fading health.

“Savita was really in agony. She was very upset, but she accepted she was losing the baby,” he told The Irish Times in a telephone interview from Belgaum, southwest India. “When the consultant came on the ward rounds on Monday morning, Savita asked if they could not save the baby, could they induce to end the pregnancy? The consultant said: ‘As long as there is a fetal heartbeat, we can’t do anything.’

“Again on Tuesday morning … the consultant said it was the law, that this is a Catholic country. Savita said: ‘I am neither Irish nor Catholic,’ but they said there was nothing they could do,” Praveen Halappanavar said.

He said his wife vomited repeatedly and collapsed in a restroom that night, but doctors wouldn’t terminate the fetus because its heart was still beating.

The fetus died the following day and its remains were surgically removed. Within hours, Praveen Halappanavar said, his wife was placed under sedation in intensive care with blood poisoning and he was never able to speak with her again. By Saturday her heart, kidneys and liver had stopped working and she was pronounced dead early Sunday, Oct. 28.

The couple had settled in 2008 in Galway, where Praveen Halappanavar works as an engineer at the medical devices manufacturer Boston Scientific. His wife qualified as a dentist but had taken time off for her pregnancy. Her parents in India had just visited them in Galway and left the day before her hospitalization.

Praveen Halappanavar said he took his wife’s remains back to India for a Hindu funeral and cremation Nov. 3. News of the circumstances that led to her death emerged Tuesday in Galway after the Indian community canceled the city’s annual Diwali festival. Savita Halappanavar had been one of the festival’s main organizers.

Opposition politicians appealed Wednesday for Kenny’s government to introduce legislation immediately to make the 1992 Supreme Court judgment part of statutory law. Barring any such bill, the only legislation defining the illegality of abortion in Ireland dates to 1861 when the entire island was part of the United Kingdom. That British law, still valid here due to Irish inaction on the matter, states it is a crime punishable by life imprisonment to “procure a miscarriage.”

In the 1992 case, a 14-year-old girl identified in court only as “X” successfully sued the government for the right to have an abortion in England. She had been raped by a neighbor. When her parents reported the crime to police, the attorney general ordered her not to travel abroad for an abortion, arguing this would violate Ireland’s constitution.

The Supreme Court ruled she should be permitted an abortion in Ireland, never mind England, because she was making credible threats to commit suicide if refused one. During the case, the girl reportedly suffered a miscarriage.

Since then, Irish governments twice have sought public approval to legalize abortion in life-threatening circumstances — but excluding a suicide threat as acceptable grounds. Both times voters rejected the proposed amendments.

Legal and political analysts broadly agree that no Irish government since 1992 has required public approval to pass a law that backs the Supreme Court ruling. They say governments have been reluctant to be seen legalizing even limited access to abortion in a country that is more than 80 percent Catholic.

Coincidentally, the government said it received a long-awaited expert report Tuesday night proposing possible changes to Irish abortion law shortly before news of Savita Halappanavar’s death broke. The government commissioned the report two years ago after the European Court of Human Rights ruled that Ireland’s inadequate access to abortions for life-threatening pregnancies violated European Union law.

An abortions right group, Choice Ireland, said Halappanavar might not have died had any previous government legislated in line with the X judgment. Earlier this year, the government rejected an opposition bill to do this.

“Today, some 20 years after the X case, we find ourselves asking the same question: If a woman is pregnant, her life in jeopardy, can she even establish whether she has a right to a termination here in Ireland?” said Choice Ireland spokeswoman Stephanie Lord.

Yet the World Health Organization identifies Ireland as an unusually safe place to be pregnant. Its most recent report on global maternal death rates found that only three out of every 100,000 women die in childbirth in Ireland, compared with an average of 14 in Europe and North America, 190 in Asia and 590 in Africa.

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FBI finds classified docs in Petraeus' lover's house

Paula Broadwell, the author who allegedly had an affair with former CIA
Director David Petraeus, is suspected of storing significant amounts of
military documents, including classified material, at her home,
potentially in violation of federal law.

A source familiar with case told ABC News that Broadwell admitted to the
FBI she took the documents from secure government buildings. The
government demanded that they all be given back, and when federal agents
descended on her North Carolina home on Monday night it was a
pre-arranged meeting.

Prosecutors are now determining whether to charge Broadwell with a
crime, and this morning the FBI and military are poring over the
material. The 40-year-old author, who wrote the biography on Gen.
Petraeus "All In," is cooperating and the case, which is complicated by
the fact that as an intelligence officer in the U.S. Military Reserve
she had security clearance to review the documents.

FULL COVERAGE: David Petraeus Scandal

The FBI found classified material on a computer voluntarily handed over
by Broadwell earlier in the investigation. Prosecutors will now have to
determine how important the classified material is before making a final
decision. Authorities could decide to seek disciplinary action against
her rather than pursue charges.

Senior FBI officials are expected to brief the House and Senate
Intelligence Committees today on their handling of the Petraeus
investigation. The officials are expected to lay out how the case was
developed and argue that there were no politics involved.

The case is so critical that FBI Director Robert Mueller may attend to
defend the bureau, ABC News has learned. Members of Congress have been
angry that they were not informed about the case before the story was
reported by the media, but FBI officials maintain that their guidelines
forbid them from discussing ongoing criminal cases.

This summer, Florida socialite and "honorary ambassador" to the military Jill Kelley
received anonymous emails accusing her of flaunting a friendly
relationship with military brass in Tampa. Kelley then called the FBI,
which traced those emails back to Broadwell's computer. Investigators
are said to have then found emails in Broadwell's inbox that pointed to
an intimate affair with Petraeus, who on Friday admitted to the affair
and announced his resignation as CIA director.

See the timeline of the Petraeus/Broadwell affair HERE.

The FBI has now uncovered "potentially inappropriate" emails between
Gen. John Allen, the commander of American forces in Afghanistan, and
Kelley, according to a senior U.S. defense official who is traveling with
Defense Secretary Leon Panetta. The department is reviewing between
20,000 and 30,000 documents connected to this matter, the official said.
The email exchanges between Kelley and Allen took place from 2010 to
2012.

The U.S. official said the emails were "innocuous" and mostly about
upcoming dinner parties and seeing him on TV. Allen denies he was
involved in an affair, a Pentagon official said. An intermediary for
Allen told ABC News that Allen and his wife are friends with Kelley and
her husband and most of the emails were sent from Kelley to Allen's
wife.

A U.S. official said Allen may have triggered the investigation when he
got an anonymous email a few months ago that was traced to Broadwell.
The email had a "Kelley Patrol" return address or subject line and
painted Kelley as a seductress, which Allen found alarming and mentioned
to Kelley in a subsequent email, the official said.

The official described Kelley as a "nice, bored rich socialite who drops
the honorary from her title... and tells people she is an ambassador.
She gets herself in anything related to Centcom and all the senior
people and has been for years."

MORE: Jill Kelley and Twin Closely Tied to Top Brass

Leon Panetta: 'No One Should Leap to Any Conclusions' Regarding Gen. Allen

Panetta cautioned that "no one should leap to any conclusions" about allegations against Allen over the investigation.

Panetta said he supports Allen, who has been in command in Kabul since
July 2011. He took over that summer for Petraeus, who retired from the
Army to take over as the head of the CIA.

"He certainly has my continued confidence to lead our forces and to
continue the fight," Panetta said at a news conference in Perth,
Australia, Wednesday.

Panetta declined to explain the nature of Allen's correspondence with
Kelley, connected to the scandal that led to Petraeus' resignation last
week as director of the CIA.

Secretary of State Hillary Rodham Clinton, who appeared with Panetta,
declined to comment on the Allen case, but insured the scandal has not
harmed the war effort.

"There has been a lot of conversation, as you might expect, but no
concern whatsoever being expressed to us because the mission has been
set forth and it's being carried out," Clinton said.

Allen had been nominated as the next commander of U.S. European Command
and the commander of NATO forces in Europe, and despite President
Obama's backing, the nomination has been put on hold. The change of
command at NATO is currently slated to not take place until March at the
earliest.

Allen was supposed to appear before a Senate confirmation hearing this
Thursday alongside his designated replacement, Marine Gen. Joseph
Dunford. Panetta said that while the matter is being investigated by
the Defense Department IG, Allen will remain in his post as commander of
the International Security Assistance Force, based in Kabul.

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General investigated for emails to Petraeus friend

PERTH, Australia (AP) — In a new twist to the Gen. David Petraeus sex scandal, the Pentagon said Tuesday that the top American commander in Afghanistan, Gen. John Allen, is under investigation for alleged “inappropriate communications” with a woman who is said to have received threatening emails from Paula Broadwell, the woman with whom Petraeus had an extramarital affair.

Defense Secretary Leon Panetta said in a written statement issued to reporters aboard his aircraft, en route from Honolulu to Perth, Australia, that the FBI referred the matter to the Pentagon on Sunday.

Panetta said that he ordered a Pentagon investigation of Allen on Monday.

A senior defense official traveling with Panetta said Allen’s communications were with Jill Kelley, who has been described as an unpaid social liaison at MacDill Air Force Base, Fla., which is headquarters to the U.S. Central Command. She is not a U.S. government employee.

Kelley is said to have received threatening emails from Broadwell, who is Petraeus’ biographer and who had an extramarital affair with Petraeus that reportedly began after he became CIA director in September 2011.

Petraeus resigned as CIA director on Friday.

Allen, a four-star Marine general, succeeded Petraeus as the top American commander in Afghanistan in July 2011.

The senior official, who discussed the matter only on condition of anonymity because it is under investigation, said Panetta believed it was prudent to launch a Pentagon investigation, although the official would not explain the nature of Allen’s problematic communications.

The official said 20,000 to 30,000 pages of emails and other documents from Allen’s communications with Kelley between 2010 and 2012 are under review. He would not say whether they involved sexual matters or whether they are thought to include unauthorized disclosures of classified information. He said he did not know whether Petraeus is mentioned in the emails.

“Gen. Allen disputes that he has engaged in any wrongdoing in this matter,” the official said. He said Allen currently is in Washington.

Panetta said that while the matter is being investigated by the Defense Department Inspector General, Allen will remain in his post as commander of the International Security Assistance Force, based in Kabul. He praised Allen as having been instrumental in making progress in the war.

The FBI’s decision to refer the Allen matter to the Pentagon rather than keep it itself, combined with Panetta’s decision to allow Allen to continue as Afghanistan commander without a suspension, suggested strongly that officials viewed whatever happened as a possible infraction of military rules rather than a violation of federal criminal law.

Allen was Deputy Commander of Central Command, based in Tampa, prior to taking over in Afghanistan. He also is a veteran of the Iraq war.

In the meantime, Panetta said, Allen’s nomination to be the next commander of U.S. European Command and the commander of NATO forces in Europe has been put on hold “until the relevant facts are determined.” He had been expected to take that new post in early 2013, if confirmed by the Senate, as had been widely expected.

Panetta said President Barack Obama was consulted and agreed that Allen’s nomination should be put on hold. Allen was to testify at his confirmation hearing before the Senate Armed Services Committee on Thursday. Panetta said he asked committee leaders to delay that hearing.

NATO officials had no comment about the delay in Allen’s appointment.

“We have seen Secretary Panetta‘s statement,” NATO spokeswoman Carmen Romero said in Brussels. “It is a U.S. investigation.”

Panetta also said he wants the Senate Armed Services Committee to act promptly on Obama’s nomination of Gen. Joseph Dunford to succeed Allen as commander in Afghanistan. That nomination was made several weeks ago. Dunford’s hearing is also scheduled for Thursday.

___

Associated Press writer Slobodan Lekic in Kabul, Afghanistan, contributed to this report.

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New Lumia phones seen winning Nokia more time

HELSINKI (Reuters) – Nokia‘s new Lumia smartphones are trickling into the market and early signs suggest they may sell well enough to give the handset maker more time in its fight against industry leaders Samsung and Apple.

But investors shouldn’t expect a quick turnaround for the struggling Finnish cellphone maker, with rival gadgets like mini tablet computers vying for consumers’ attention, analysts said.

“Positive reviews are a great start but as we have seen many times before these won’t deliver strong sales volumes on their own,” said Pete Cunningham, an analyst at research firm Canalys.

Successful sales of the latest Lumia 920 and 820 models are crucial for Nokia’s survival. The former market leader is burning through cash while it loses share in both high-end smartphones and cheaper handsets.

FIM Securities analyst Michael Schroder forecast Nokia will sell 1-3 million of the new models this quarter. It sold 2.9 million older Lumia models in the third quarter, compared to Apple’s sales of around 26.6 million iPhones in the same period.

“In any case the uptake will not be massive,” he predicted.

Lumia’s sales could serve a verdict on Chief Executive Stephen Elop‘s decision in February 2011 to partner with Microsoft instead of using Google‘s Android or continuing to develop Nokia’s own operating system.

Investors had feared poor reviews and weak sales could bring an end to the company’s smartphone business early next year.

So far, consumer reviews seem to favor the feel and look of the new models, which include high-definition cameras and the latest Microsoft Windows Phone 8 software.

“It (the Lumia 920) is very similar in appearance to the Lumia 900, but has curved glass, rounded edges, and curved back so it feels great in your hand. It is a dense device, but if you look at all the pros and cons the heft is worth it,” said a reviewer for tech website ZDNet.

That’s an improvement from the market’s reaction when the new model was first unveiled. The shares slumped 13 percent that day with investors citing a lack of a “wow” factor.

MAKE OR BREAK

Nokia is taking a gradual approach to launching the phones, and availability is expected to vary by market for the next few weeks, compared with Apple’s iPhone models which usually go on sale on the same day to global fanfare.

“While we are very impressed with the hardware features of the Lumia 920 and the improved software functionality of Windows Phone 8, we believe a focused launch to drive steady sales growth is necessary,” said Canaccord Genuity analyst Michael Walkley.

In Canada, one of the earliest launch markets, carrier Rogers Communications has trained its sales staff more to sell the latest Lumias than the previous models, said John Boynton, Rogers’ executive vice president of marketing.

He predicted the phones would be popular with first-time smartphone users, thanks to homescreens with tile-like icons designed to help users navigate applications and functions.

“They’re a little nervous at some of the more complex smartphones that are out there,” he said. “The tile format is a really, really simplified way for people to get comfortable using smartphones.”

In France, retail staff have become more confident in explaining Windows Phones to their customers, according to Laurent Lame, devices marketing chief at SFR which is the country’s second-biggest mobile operator.

“They know the product better after six months of good sales of the Lumia 610,” Lame said, adding he was now more optimistic about the Nokia-Microsoft partnership. “For once, with Windows 8, we are not starting from zero.”

Telefonica Deutschland Chief Executive Rene Schuster said he was “very, very pleased” with the early progress of Lumia sales.

Some retailers were more cautious, however, and in some cities there were no demonstration models for customers to test.

A salesman in an O2 store at the Zeil, Frankfurt’s busiest shopping area, said the store could take orders for the phone but could not show it. Demand was “okay, but not huge,” he said.

Analysts also expect tough competition during the pre-Christmas shopping season from the likes of Samsung’s Galaxy S III and Apple’s iPhone 5. Taiwan’s HTC has also introduced smartphones running Windows Phone 8 software.

Other rival gadgets include Apple’s iPad mini as well as cheaper tablets from Google and Amazon.

The stakes could not be higher for Nokia’s Elop, who said in February 2011 the company’s transition would take two years.

“This is absolutely a make-or-break phone for the Windows Phone strategy,” FIM Securities’ Schroder said. “If it fails, they have to take a whole new course.” (Additional reporting by Allison Martell in Toronto, Leila Abboud in Paris, Harro Ten Wolde in Frankfurt and Tarmo Virki in Helsinki; Editing by Mark Potter)

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Day-Lewis heeded inner ear to find Lincoln’s voice

LOS ANGELES (AP) — A towering figure such as Abraham Lincoln, who stood 6 feet 4 and was one of history’s master orators, must have had a booming voice to match, right? Not in Daniel Day-Lewis‘ interpretation.

Day-Lewis, who plays the 16th president in Steven Spielberg‘s epic film biography “Lincoln,” which goes into wide release this weekend, settled on a higher, softer voice, saying it’s more true to descriptions of how the man actually spoke.

“There are numerous accounts, contemporary accounts, of his speaking voice. They tend to imply that it was fairly high, in a high register, which I believe allowed him to reach greater numbers of people when he was speaking publicly,” Day-Lewis said in an interview. “Because the higher registers tend to reach farther than the lower tones, so that would have been useful to him.”

“Lincoln” is just the fifth film in the last 15 years for Day-Lewis, a two-time Academy Award winner for best actor (“My Left Foot” and “There Will Be Blood”). Much of his pickiness stems from a need to understand characters intimately enough to feel that he’s actually living out their experiences.

The soft, reedy voice of his Lincoln grew out of that preparation.

“I don’t separate vocal work, and I don’t dismember a character into its component parts and then kind of bolt it all together, and off you go,” Day-Lewis said. “I tend to try and allow things to happen slowly, over a long period of time. As I feel I’m growing into a sense of that life, if I’m lucky, I begin to hear a voice.

“And I don’t mean in a supernatural sense. I begin to hear the sound of a voice, and if I like the sound of that, I live with that for a while in my mind’s ear, whatever one might call it, my inner ear, and then I set about trying to reproduce that.”

Lincoln himself likely learned to use his voice to his advantage depending on the situation, Day-Lewis said.

“He was a supreme politician. I’ve no doubt in my mind that when you think of all the influences in his life, from his childhood in Kentucky and Indiana and a good part of his younger life in southern Illinois, that the sounds of all those regions would have come together in him somehow.

“And I feel that he probably learned how to play with his voice in public and use it in certain ways in certain places and in certain other ways in other places. Especially in the manner in which he expressed himself. I think, I’ve no doubt that he was conscious enough of his image.”

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War uproots 2.5 million Syrians, aid groups say

GENEVA (Reuters) – At least 2.5 million Syrians are believed to have fled their homes because of civil war, aid groups said on Tuesday, more than double previous estimates.

The figure comes from the Syrian Arab Red Crescent, whose volunteers are on the frontlines of the 20-month conflict, delivering aid supplies and evacuating wounded.

“The figure they are using is 2.5 million. If anything, they believe it could be more, that this is a very conservative estimate,” Melissa Fleming, chief spokeswoman of the U.N. High Commissioner for Refugees (UNHCR), told a news briefing.

“So people are moving, people are really on the run, hiding. They are difficult to count and to access,” she said.

Aid agencies had previously thought there were around 1.2 million internally displaced Syrians.

Only 5 percent of the 2.5 million are believed to be living in public facilities, including warehouses and schools, said Fleming. The rest are staying with host families, making it more difficult to count them.

In recent days, air strikes on the town of Ras al-Ain near the Turkish border have caused some of the biggest refugee movements of the conflict.

The United Nations said on Friday that up to 4 million people inside Syria will need humanitarian aid by early next year when the country is in the grip of winter, up from 2.5 million now whose needs are not fully met.

For now, the U.N. World Food Programme (WFP) says its food rations are reaching some 1.5 million. The UNHCR aims to provide assistance to 500,000 in Syria by the end of the year, mainly blankets, clothing, cooking kits and jerry cans, Fleming said.

“Unfortunately the recent deliveries have been very difficult, marred by violence and insecurity also spreading to parts of the country that used to be relatively calm,” she said.

A Syrian Arab Red Crescent warehouse in Aleppo was apparently hit by a shell, burning 13,000 blankets, she said. Unknown armed men hijacked a truck carrying 600 blankets on its way to Adra, outside Damascus.

The UNHCR has temporarily withdrawn about half of its 12 staff from north-eastern Hassaka province due to fierce fighting and insecurity, Fleming said.

“We see corresponding movement of populations there, Syrian Kurds for the most part, across the border into Iraq,” she said.

More than 407,000 Syrian refugees have registered or await registration in the surrounding region – Lebanon, Turkey, Jordan and Iraq – and more are fleeing every day, according to UNHCR.

(Editing by Tom Pfeiffer)

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