Daily Archives: January 28, 2013

11 Body Parts Defense Researchers Will Use to Track You

Slightly creepy, no? Well, it gets creepier…
. . .
wired.com | Jan 25, 2013By Noah Shachtman and Robert Beckhusen
The Ear

Cell phones that can identify you by how you walk. Fingerprint scanners that work from 25 feet away. Radars that pick up your heartbeat from behind concrete walls. Algorithms that can tell identical twins apart. Eyebrows and earlobes that give you away. A new generation of technologies is emerging that can identify you by your physiology. And unlike the old crop of biometric systems, you don’t need to be right up close to the scanner in order to be identified. If they work as advertised, they may be able to identify you without you ever knowing you’ve been spotted.

Biometrics had a boom after 9/11. Gobs of government money poured into face and iris recognition systems; the Pentagon alone spent nearly $3 billion in five years, and the Defense Department was only one of many federal agencies funneling cash in the technologies. Civil libertarians feared the worst as face-spotters were turned on crowds of citizens in the hopes of  catching a single crook.

But while the technologies proved helpful in verifying identities at entry points from Iraq to international airports, the hype — or panic — surrounding biometrics never quite panned out. Even after all that investment, scanners still aren’t particularly good at finding a particular face in the crowd, for example; variable lighting conditions and angles (not to mention hats) continue to confound the systems.

Eventually, the biometrics market — and the government enthusiasm for it — cooled off. The technological development has not. Corporate and academic labs are continuing to find new ways to ID people with more accuracy, and from further away. Here are 11 projects.

Above:

The Ear

My, what noticeable ears you have. So noticeable in fact that researchers are exploring ways to detect the ears’ features like they were fingerprints. In 2010, a group of British researchers used a process called “image ray transform” to shoot light rays at human ears, and then repeat an algorithm to draw an image of the tubular-shaped parts of the organ. The curved edges around the rim of the ear is a characteristic — and most obvious — example. Then, the researchers converted the images into a series of numbers marking the image as your own. Finally, it’s just a matter of a machine scanning your ears again, and matching it up to what’s already stored in the system, which the researchers were able to do accurately 99.6 percent of the time. In March of 2012, a pair of New Delhi scientists also tried scanning ears using Gabor filters — a kind of digital image processor similar to human vision — but were accurate to a mere 92 to 96.9 percent, according to a recent survey (pdf) of ear biometric research.

It may even be possible to develop ear-scanning in a way that makes it more reliable than fingerprints. The reason is because your fingerprints can callous over when doing a lot of hard work. But ears, by and large, don’t change much over the course of a lifespan. There’s a debate around this, however, and fingerprinting has a much longer and established history behind it. A big question is whether ear-scanning will work given different amounts of light, or when covered (even partially) by hair or jewelry. But if ear-scanners get to the point of being practical, then they could possibly work alongside fingerprinting instead of replacing them. Maybe in the future we’ll see more extreme ear modification come along as a counter-measure.

Photo: Menage a Moi/Flickr

Odor

Odor

In the early and mid-2000s, the Pentagon’s blue-sky researchers at Darpa dabbled in something called the “Unique Signature Detection Project,” which sought to explore ways to detect people by their scent, and maybe even spot and identify individuals based on their distinct smells. Darpa’s work ended in 2008. The following year, the Department of Homeland Security fielded a solicitation for research in ways that human scent can indicate whether someone “might be engaging in deception,” specifically at airports and other ports of entry.

Odor detection is still just a research project at the moment. The science is intricate, involving more than 300 chemical compounds that produce human odor. Our personal stinks can change depending on everything from what we eat to our environment. But it may be possible to distinguish our “primary odor” — separate from “secondary” odors based on our diet and “tertiary” odors based on things like soaps and shampoos. The primary odor is the one linked to our genetics, and there have already been experiments with mice, which have been found to produce distinct scents unique to individuals. In 2007, the government’s counter-terror Technical Support Working Group even started a program aimed at collecting and storing human odors for the military’s dog handlers. Dogs, of course, have been used to track people by smell for decades, and are believed to distinguish between humans based on our genetic markers.

Photo: Cabaret Voltaire/Flickr

Heartbeat

Heartbeat

Your chest moves, just a little, every time your heart beats or your lungs take in air. For years, researchers have been monkeying with radars that are sensitive enough to to detect those minuscule chest movements — but powerful enough to do it from hundreds of yards away. Even reinforced concrete walls and electromagnetic shielding won’t stop these radars, or so claim the researchers at the small, Arizona-based defense contractor VAWD Engineering, who are working on such a system for Darpa’s “Biometrics-at-a-distance” program.

The key is the Doppler Effect — the changes in frequency when one object moves relative to another. We hear it all the time, when a fire engine passes by, siren blaring. VAWD says their vehicle-mounted Sense Through Obstruction Remote Monitoring System (STORMS) can pick up even small fluctuations of chests.

STORM (pictured above) “can be used to detect, classify and identify the specific cardiac and pulmonary modulations of a… person of interest,” a company document boasts. By itself, a heartbeat or a breathing rate won’t serve as a definitive biometric. But combine it with soft biometrics (how someone subtly sways when he or she stands) and you’ve got a unique signature for that person that can’t be hidden or covered up.

VAWD says these signature will help improve disaster relief and medical care by providing a “reliable, real time medical status equal to or better than the current devices, while increasing the mobility and comfort of the patient.”

But the company also notes that its system performs “automated human life-form target tracking” even when construction materials like “Afghan mud-huts” are in the way. STORM “has already been deployed by the United States Army on one of its most advanced ground vehicles,” the company adds.

Does any of that sound like hospital work to you?

Illustration: Yale University/Wikimedia

Photo: VAWD Engineering

Voice

Most people are likely to be familiar with voice readers on gadgets like the iPhone. But what if there was software that could quickly analyze the voice of thousands, and even use those voices to identify specific people?

Russian biometrics firm Speech Technology Center — known as SpeechPro in the U.S. — has the technology. Called VoiceGrid, the system is able to automatically recognize a person’s voice as their own, provided your voice is pre-recorded in a database and can be recalled by the computer. The company has also developed a version for “large city, county, state or national system deployments.”

It’s seen use in Mexico, according to Slate, “where it is being used by law enforcement to collect, store, and search hundreds of thousands of voice-prints.” The National Security Agency has taken interest in similar technology. So has the FBI. A 2012 presentation from the National Institute of Standards and Technology — with the assistance of the FBI — also speculated on potential uses including identifying and clearing people ‘involved in illegal activities,” locating serial killers and identifying arms traffickers (.pdf). Iarpa, the intelligence community’s research agency, has also been looking into ways to solve some of its problems: audio interference mainly. In 2011, the agency concluded its Biometric Exploitation Science and Technology Program (or BEST), which made “speaker recognition advances which included improving robustness to noise, reverberation, and vocal effort, and by automatically detecting these conditions in audio channels,” spokesperson Schira Madan told Danger Room in an email. But we wonder if it’ll detect autotune.

The Iris

The Iris

Imagine a scanner than can look deep inside your eye — from 10 feet away. Actually, you don’t have to think that hard. The technology is already here. Scanners have been developed that can focus in and scan irises from a distance of 10 feet, such the IOM PassPort, developed by government contractor SRI International. The company promises the machine can scan irises at a rate of 30 people per minute — like in high-traffic areas such as airports and train stations. SRI also claims it can see through contact lenses and glasses.

But the longer-range scanners could also see other uses, aside from airports. U.S. troops field existing, short-range and handheld iris scanners to build databases of Afghan eyes as part of a plan to use biometric data to tell civilians apart from insurgents. The Department of Homeland Security has tested iris scanners at a Border Patrol station along the Texas-Mexico border. The FBI has been working on an iris database for federal prisoners, and Google uses them at company data centers. But these systems can be fussy, and require that the targets don’t move too much.

There might be another way. The Pentagon’s scientists at Darpa have funded a research project at Southern Methodist University to develop cameras that can automatically zoom-in and scan irises, kinda like what happened to Tom Cruise in Minority Report — and without being blocked by pesky obstructions like eyelashes and glare from light. But another problem is that iris scanners are not the most secure means of identifying people. In July 2012, a group of researchers from the U.S. and Spain discovered a way to spoof the scanners by duplicating iris images stored in databases and creating synthetic copies. That means someone could conceivably steal your eyes, in a way.

Illustration: Air Force

Periocular

Periocular

Spotting someone by their irises is one of the best-developed biometric techniques there is. But Savvides and his Carnegie Mellon colleagues think there may be an equally-promising approach in the area around the eye — also known as the “periocular” region.

The “periocular region has the most dense and the most complex biomedical features on human face, e.g. contour, eyelids, eyeball, eyebrow, etc., which could all vary in shape, size and color,” they wrote in a 2011 paper. (.pdf) “Biologically and genetically speaking, a more complex structure means more ‘coding processing’ going on with fetal development, and therefore more proteins and genes involved in the determination of appearance. That is why the periocular region should be the most important facial area for distinguishing people.”

And unlike other biometrics — the face, for instance — the periocular region stays remarkably stable as a person ages. “The shape and location of eyes remain largely unchanged while the mouth, nose, chin, cheek, etc., are more susceptible to changes given a loosened skin,” the researchers note. In other words, this is a marker for life.

Nearby, Savvides and his colleagues think they’ve found a second biometric: the shape of the eyebrow. Face-scanners are sometimes thrown off when people smile or frown. But the eyebrow shape is “particularly resilient to certain (but not all) expression variations,” the researchers note in a separate, yet-to-be-published paper. And the eyebrow can still be seen, even when the subject has most of his or her face covered.

What’s not fully clear is how the eyebrow biometric responds to threading, shaving or waxing. Saavides, who responded to tons of questions about his research, says there’s no fullproof means to avoid this kind of spoofing. But Saavides is also working on sensors that can analyze multiple facial cues and features, while incorporating algorithms that detect the possibility of a person changing one or two of them. A pair of plucked eyebrows might be a weak match compared to the bushy ones the computer has on file — but the computer could also be smart enough to recognize they’ve been plucked.

Photo: Carnegie Mellon University

Long-Range Fingerprint Scanners

Long-Range Fingerprint Scanners

Most fingerprint scanners today require physical contact, but constantly being soaked with finger-oil and dirt can also muck-up the machines. For that reason, among others, one developer is working on a scanner that may one day read your fingerprints at a distance of 20 feet.

But first, scanners with a 20-foot distance haven’t hit the market quite yet. One machine called the AIRprint, made by Alabama firm Advanced Optical Systems, has a range of nine feet, and uses two 1.3 megapixel cameras that receives light in different wavelengths: one horizontally polarized, and the other vertically polarized. To sort out the different wavelengths, a device beams light at your fingerprints, which bounce back into the lenses, which then combines the separate wavelengths into a clear picture. A spin-off company called IDair also has a commercial scanner that reaches up to six feet and is marketed toward “security personnel.” IDair’s 20-foot-range machine is currently in development, and is described as functioning similar to satellite imagery.

The military is reportedly an interested customer. The MIT Technology Review surmised that Marines may use them for scanning fingerprints from inside the relative safety of an armored vehicle or behind a blast wall. It beats exposing yourself to the possibility of a suicide bomb attack. For the civilian market, that seems better than pressing your fingertips against a greasy scanner, if you’re comfortable with the idea of having your prints scanned from far away.

Photo: LetTheCardsFall/Flickr

Gait

Gait

Even before 9/11, researchers were floating that notion that you could pick out someone by how he or she walks. And after the Towers fell, Darpa made gait recognition one of the cornerstones of its infamous Total Information Awareness counterterror program.

The problem is that gait can be kind of hard to spot. A briefcase or a bum leg prevents the recognition system from getting a clear view. So filming someone walk didn’t make for a particularly reliable biometric system. Plus, the same person may have multiple gaits — one for walking, and another for running, say.

But the spread of smartphones has opened up a new way of identifying someone’s stride. Androids and iPhones all have accelerometers — sensors that measure how far, how fast, and with how much force an object moves.

“By using the accelerometer sensor in the cell phone, we are able to capture a person’s walking pattern. As it turns out, these patterns are very good biometric traits for people identification. Because it does not require any special devices, the gait biometrics of a subject can even be captured without him or her knowing,” write Carnegie Mellon University professor Marios Savvides and his colleagues in a recent paper. (.pdf)

In a small, preliminary study, Savvides and his fellow researchers at the CyLab Biometrics Center claim they were able to get a 99.4% verification rate with the system when the subjects were walking. 61% of the time, they were even able to match someone’s fast-paced gait to their slower one. In other words, you can run…. but with a phone in your pocket, it’s going to be harder to hide.

Photo: sfllaw/Flickr

Sweat

Sweat

The Army wants to see some sweat. No, not workout sweat, but sweat that can betray hostile intentions. In 2010, the Army awarded a nearly $70,000 contract to California security firm Irvine Sensors Corporation to develop software that can use sensors to recognize at “abnormal perspiration and changes in body temperature.” The idea was to determine “harmful intent in such military applications as border patrol, stand-off interrogation, surveillance and commercial applications” including surveillance at businesses and “shopping areas.” It’s a bit out there, and still very much in the research stage, but makes a certain kind of sense. Elevated stress levels could give a suspect away when scanned by hyperspectral sensors that read changes in body temperature.

Though a reliable system will have to work in combination with other biometric signals: threatening body movements, facial expressions, iris scans — all of these will also have to be factored into determining whether someone is up to no good. The Army contract, dubbed Image Analysis for Personal Intent, also sought to develop sensors that read these signs from a distance of nearly 150 feet. Perhaps a bit optimistic. But in 2002, a group of scientists in Minnesota managed to determine if military recruits were engaging in deception by scanning for changes in temperature around their eyes. So if you’re at all freaked out about the idea of sweat-scanners, now might be time for a cold shower.

Photo: Army

Advanced Face Recognition

Advanced Face Recognition

Most machines that scan and recognize your face require taking a good, clean look. But now researchers are working on replacing them with scanners that only need a few fragmentary snapshots at much longer ranges than ever before.

One machine that can do it is being developed by defense contractor Progeny Systems Corporation, called the “Long Range, Non-cooperative, Biometric Tagging, Tracking and Location” system. Once a person of interest is spotted, the system captures a 2D image of the person’s face before converting it into 3D. Then, once the image has been converted and filed in a database, it can be quickly recalled when the system spots the person for a second time. That’s because 3D reduces the number of pixels needed to analyze the image, speeding up the process and allowing the system to identify a person with a mere glance. The company also claims the machine works at more than 750 feet.

But a face alone may not be enough to recognize a person with a machine. Everything from lighting conditions to distance can make it harder to get a clear picture, especially if the person being scanned is on the move, in a crowd, or ducking in and out of buildings. Using 3D models makes it easier, but the technology will likely have to be combined with “soft biometrics” like an individual’s gender, height, weight, skin color and even tattoos.

Slightly creepy, no? Well, it gets creepier, like the group of Swiss scientists working on scanning facial features to detect your emotions. Developers at Carnegie Mellon University have also developed a mobile app called PittPatt –which has since been acquired by Google — that can scan your face and match it up with images you’ve shared over the internet, all in less than a minute.

Photo: Carnegie Mellon University

Rapid DNA Testing

Rapid DNA Testing

It used to be that DNA testing took months to perform, from the time when a DNA sample was picked up on a swab, to analyzing it and creating a DNA profile. Now there are machines that can do it in less than 90 minutes, and the Pentagon wants them.

This month, researchers at the University of North Texas are beginning to test a $250,000 machine for the Defense and Justice Departments, and the Department of Homeland Security, so that “casualties and enemies killed in action can be quickly identified in the field,” according to the Biometrics Research Group. But according to the October issue of Special Operations Technology magazine, rapid DNA testing systems co-developed by defense giant Northrop Grumman had already been delivered to “unspecified government customers” beginning back in August. One of those customers is believed to be the FBI. California company IntegenX also has a portable rapid-DNA machine that can analyze molecules taken off everything from clothing to cigarette butts. There’s a simple reason why police are so interested. For a burglar who’s breaking into houses and leaving a DNA trail, the machines could clue-in faster than the burglar is able to continue the spree.

Photo: US Navy

DARPA produces 10 million flu vaccine doses in one month

darpa-vaccine-1
Tobacco plants used in the development of the vaccine

**Editor’s Warning: This article is highly infectious military/industrial/medical propaganda. Read at own risk. Take necessary precautions.**

gizmag.com | Jan 26, 2013

By David Szondy

A familiar news topic during the flu season is the difficulties that the authorities face in producing enough flu vaccine fast enough to control the outbreak. That’s a serious enough problem, but when the influenza outbreak turns out to be the start of a global pandemic, then hundreds of millions of lives could be at risk. To combat this, the Defense Advanced Research Projects Agency (DARPA) has developed a new way of making vaccines that has turned out 10 million doses of H1N1 influenza vaccine in a month, in a recent test run.

A globalized world means a world increasingly at risk from pandemic diseases. According to the World Health Organization (WHO), 20 to 50 percent of the world’s population is at risk from a pandemic outbreak such as that seen in the influenza epidemic of 1918. US military forces are particularly vulnerable because the nature of military life is perfect for the spread of disease, unless countermeasures such as cleanliness and vaccinations are constantly employed.

The problem is, vaccines for new diseases can’t be produced quickly. According to WHO, it can take up to nine months to develop and put a vaccine into production. Worse, egg-based and other conventional vaccine production techniques may not be able to scale up sufficiently to meet the demand – especially for diseases where two doses per person are required for adequate protection.

DARPA’s approach to solving this is the Blue Angel program. Started in response to the 2009 H1N1 swine flu pandemic, its purpose is to quickly develop practical countermeasures to disease outbreaks due to either natural causes or biowarfare attack. The program has a number of aspects, such as finding ways to identify people who are infected before symptoms show, but one major facet is the Accelerated Manufacture of Pharmaceuticals (AMP) project.

Working with Medicago Inc., AMP uses tobacco plants instead of eggs to produce recombinant proteins that are key to vaccines. According to the company, introducing viral genes into tobacco has a number advantages: the full-grown plants can be used because the protein is produced in the leaves; it avoids the need to procure eggs in huge quantities; and, there’s no danger of the virus killing the egg embryo. Medicago said that the tobacco process can generate the proteins within 14 days of the gene sequence of the virus being identified, with vaccine-grade proteins generated within four weeks. In the DARPA tests, 10 million doses of H1N1 influenza vaccine were produced in one month, as defined by an animal model.

According to DARPA, third party testing confirmed that a single dose in an animal model produced hemagglutinin antibodies at a protective strength. However, only clinical trials can determine how effective it would be on humans, and the entire process still needs FDA approval.

Federal Reserve enters ‘uncharted territory’ with assets of $3 trillion

federal reserve
Federal Reserve Chairman Ben Bernanke speaks during a news conference at the Federal Reserve Board in Washington, Wednesday, Dec. 12, 2012, following the Federal Open Market Committee meeting. The Federal Reserve sent its clearest signal to date Wednesday that it will keep interest rates super-low to boost the U.S. economy even after the job market has improved significantly. (AP Photo/Manuel Balce Ceneta)

The central bank’s balance sheet has provided record windfalls to the Treasury.

Bloomberg News | Jan 26, 2013

By Joshua Zumbrun and Jeff Kearns

WASHINGTON • Federal Reserve Chairman Ben Bernanke’s unprecedented bond buying has pushed the Fed’s balance sheet to a record $3 trillion as he shows no sign of softening his effort to bring down unemployment.

The Fed is buying $85 billion of securities every month, using the full force of its balance sheet to stoke the economic recovery. The central bank began $40 billion in monthly purchases of mortgage-backed securities in September and added $45 billion in Treasury securities to that pace this month.

“We’re in uncharted territory,” said Julia Coronado, chief economist for North America at BNP Paribas SA in New York.

The Fed’s assets climbed by $48 billion in the past week to $3.01 trillion as of Wednesday, according to a release from the central bank.

Fiscal astrology forecast: Trillion is the new billion
http://www.seacoastonline.com/articles/20130127-NEWS-301270359

Fed policy makers have voiced increasing concern that record-low interest rates are overheating markets for assets from farmland to junk bonds, which could heighten risks when they reverse their unprecedented bond purchases.

Yet with unemployment still high almost 3½ years into an economic recovery, Fed officials are expected to affirm their accommodation when they meet in Washington next week.

“You’re hard pressed to find another example in history where the Fed pulled out all the stops to help a recovery along,” said Michael Hanson, senior U.S. economist at Bank of America Corp. in New York. “It’s at least as revolutionary as Paul Volcker coming in and saying we’re going to hike rates until inflation” declines.

The Fed has a dual mandate from Congress to achieve stable prices and maximum employment. Volcker, Fed chairman from 1979 to 1987, pushed interest rates to as high as 22 percent to rein in inflation that was approaching 15 percent. Now Bernanke is focusing Fed policy on the other mandate, aiming to reduce the ranks of the nation’s 12.2 million unemployed workers.

Fed officials have said their $85 billion pace of purchases will continue until the labor market improves “substantially.”

Still, they disagree on how long to continue the buying.

The minutes from the Federal Open Market Committee’s December meeting show that participants were “approximately evenly divided” between those who said the purchases should end around mid-2013 and those who said they should continue longer. Some policy makers are concerned that the size of the Fed’s holdings “could complicate the Committee’s efforts to eventually withdraw monetary policy accommodation,” according to the minutes.

The central bank’s balance sheet has provided record windfalls to the Treasury. After paying its own expenses out of its interest income, the Fed sent the Treasury $88.9 billion last year.

Yahoo joins Dell swelling Netherlands’ $13 trillion tax haven for multinational companies

mayer
Marissa Mayer, chief executive officer of Yahoo! Inc., smiles during TechCrunch Disrupt SF 2012 in San Francisco, on Sept. 12. Yahoo has taken advantage of the law to quietly funnel hundreds of millions of dollars in global profits to island subsidiaries, cutting its worldwide tax bill. / DAVID PAUL MORRIS/BLOOMBERG

Now, as a deficit-strapped Europe raises retirement ages and taxes on the working class, the Netherlands’ role as a $13 trillion relay station on the global tax-avoiding network is prompting a backlash.

delawareonline.com | Jan 26, 2013

Inside Reindert Dooves’ home, a 17th century, three-story converted warehouse along the Zaan canal in suburban Amsterdam, a 21st-century Internet giant is avoiding taxes.

The bookkeeper’s home office doubles as the headquarters for a Yahoo! Inc. offshore unit. Through this sun-filled, white walled room, Yahoo has taken advantage of the law to quietly funnel hundreds of millions of dollars in global profits to island subsidiaries, cutting its worldwide tax bill.

The Yahoo arrangement illustrates that the Netherlands, in the heart of a continent better known for social welfare than corporate welfare, has emerged as one of the most important tax havens for multinational companies. Now, as a deficit-strapped Europe raises retirement ages and taxes on the working class, the Netherlands’ role as a $13 trillion relay station on the global tax-avoiding network is prompting a backlash.

The Dutch Parliament is scheduled to debate the fairness of its tax system today. Lawmakers from several parties, including members of the country’s governing coalition, say they want to remove a stain on the nation’s reputation.

“We should not be a tax haven,” said Ed Groot, a parliament member from the Labour Party, which along with the People’s Party for Freedom and Democracy took power in November. Both ruling parties are “fed up with these so called PO Box companies,” he said. “If they go somewhere else we are not sorry at all because they spoil the name of Holland. Otherwise you can wait for retaliation measures and this we don’t want.”
War Declaration

Last month, the European Commission, the European Union’s executive body, declared a war on tax avoidance and evasion, which it said costs the EU 1 trillion euros a year. The commission advised member states — including the Netherlands — to create tax-haven blacklists and adopt anti-abuse rules. It also recommended reforms that could undermine the lure of the Netherlands, and hurt a spinoff industry that has mushroomed in and around Amsterdam to abet tax avoidance.

Read More

Goebbels’ Revenge: Nazi Step-Grandchildren Are Hidden Billionaires

goebbels
Harald Quandt, Magda Goebbels’ son by her first marriage, center back stands in uniform with his step-father Nazi propaganda minister Joseph Goebbels, bottom from right, his mother Magda, third from left, and the couple’s children, Helga, Hildegard, Helmut, Hedwig, Holdine and Heidrun in 1942. Keystone/Hulton Archive/Getty Images

bloomberg.com | Jan 27, 2013

By David de Jong

In the spring of 1945, Harald Quandt, a 23-year-old officer in the German Luftwaffe, was being held as a prisoner of war by Allied forces in the Libyan port city of Benghazi when he received a farewell letter from his mother, Magda Goebbels — the wife of Nazi propaganda minister Joseph Goebbels.

The hand-written note confirmed the devastating news he had heard weeks earlier: his mother had committed suicide with her husband on May 1, after slipping their six children cyanide capsules in Adolf Hitler’s underground bunker in Berlin.

“My dear son! By now we’ve been in the Fuehrerbunker for six days already, Daddy, your six little siblings and I, to give our national socialistic lives the only possible, honorable ending,” she wrote. “Harald, dear son, I want to give you what I learned in life: Be loyal! Loyal to yourself, loyal to the people and loyal to your country!”

Quandt was released from captivity in 1947. Seven years later, he and his half-brother Herbert — Harald was the only remaining child from Magda Goebbels’ first marriage — would inherit the industrial empire built by their father, Guenther Quandt. The brothers took the business, which had produced Mauser firearms and anti-aircraft missiles for the Third Reich’s war machine. Their most valuable assets became stakes in car manufacturers Bayerische Motoren Werke AG (BMW) and Daimler AG. (DAI)

Lower Profile

While the half-brothers passed away decades ago, their legacy has endured. Herbert’s widow, Johanna Quandt, 86, and their children Susanne Klatten and Stefan Quandt, have remained in the public eye as BMW’s dominant shareholders. The billionaire daughters of Harald Quandt — Katarina Geller-Herr, 61, Gabriele Quandt, 60, Anette-Angelika May-Thies, 58, and fifty-year-old Colleen-Bettina Rosenblat-Mo — have kept a lower profile.

The four sisters inherited about 1.5 billion deutsche marks ($760 million) after the death of their mother, Inge, in 1978, according to the family’s sanctioned biography, “Die Quandts.” They manage their wealth through the Harald Quandt Holding GmbH, a Bad Homburg, Germany-based family investment company and trust named after their father. Dr. Fritz Becker, the chief executive officer of the family entities, said the siblings realized average annual returns above 7 percent from its founding in 1981 through 1996. Since then, the returns have averaged 7.6 percent.

“The family wants to stay private and that is an acceptable situation for me,” said Becker in an interview at his Bad Homburg office. “We invest our money globally and if it’s $1 billion, $500 million or $3 billion, who cares?”

Wartime Profits

Together, the four sisters — and the two children of a deceased sibling — share a fortune worth at least $6 billion, giving each of them a net worth of $1.2 billion, according to the Bloomberg Billionaires Index. They have never appeared individually as billionaires on an international wealth ranking.

Becker declined to provide the exact figure the holding manages for the four sisters. The siblings declined to comment for this account, said Ralf-Dieter Brunowsky, a spokesman for the family investment company, in an e-mail. He said the net worth calculation was “too high,” declining to be more specific.

The rise of the Quandt family fortune shares the same trajectory as Germany’s quest for global domination in the 20th century. It began in 1883, when Emil Quandt acquired a textile company owned by his late father-in-law. At the turn of the century, Emil passed the business to his eldest son, Guenther.

The younger Quandt saw an opportunity with the onset of war in 1914. His factories, already one of the biggest clothing manufacturers for the German state, quadrupled their weekly uniform production for the army, according to “Die Quandts.”

Weapons Production

After Germany’s surrender four years later, Quandt put the company’s wartime profits to use. In 1922, he bought a majority stake in Accumulatoren-Fabrik AG (AFA), a Hagen-based battery manufacturer. Six years later, he took over Berlin-Karlsruher Industriewerken AG (BKIW), a Berlin-based manufacturer that made sewing machines and silverware. The factory, once one of Germany’s largest weapon producers, had been forced to retool as part of the country’s disarmament agreement.

“The Quandt’s business grew in the Kaiserreich, it grew during the Weimar Republic, it grew during the Second World War and it grew strongly after the war,” Rudiger Jungbluth, author of “Die Quandts,” said in an interview at a Bavarian restaurant in Hamburg last November.

Nazi Connections

In 1918, Guenther Quandt’s first wife died of the Spanish flu, leaving him a widower with two young sons, Hellmut and Herbert. He remarried Magda Ritschel in 1921, and the couple’s only son, Harald, was born later that year. Hellmut died in 1927, from complications related to appendicitis.

Quandt and Magda divorced in 1929. Two years later, she married Joseph Goebbels, a member of the German parliament who also held a doctorate degree in drama and served as head of propaganda for Germany’s growing Nazi party. After the Nazis took power in 1933, their leader, Adolf Hitler, appointed Goebbels as the Third Reich’s propaganda minister.

Guenther Quandt joined the party that same year. His factories became key suppliers to the German war effort, even though his relationship with Goebbels had become increasingly strained.

“There was constant rivalry,” said Bonn-based history professor Joachim Scholtyseck, author of a family-commissioned study about their involvement with the Third Reich, in a telephone interview. “It didn’t matter that Goebbels didn’t like him. It didn’t have any influence on Quandt’s ability to make money.”

Forced Labor

In 1937, he earned the title of Wehrwirtschaftsfuehrer, the name given to members of an elite group of businessmen who were deemed beneficial to the production of war materials for the Third Reich. During the war, Quandt’s AFA manufactured batteries for U-Boat submarines and V-2 rocket launchers. His BKIW –which had been renamed Deutsche Waffen-und Munitionsfabriken AG in 1936 — produced Mauser firearms, ammunition and anti-aircraft missiles.

“He was one of the leading industrialists in the Third Reich and the Second World War,” Scholtyseck said. “He always kept a very low profile.”

From 1940 to 1945, the Quandt family factories were staffed with more than 50,000 forced civilian laborers, prisoners of war and concentration camp workers, according to Scholtyseck’s 1,183-page study. The report was commissioned by the family in 2007 after German television aired the documentary “The Silence of the Quandts,” a critical look at their wartime activities.

Released in September 2011, the study also found that Quandt appropriated assets from Jewish company owners and that his son Herbert had planned building an AFA factory in which slave laborers would be deployed.

Army Volunteer

“Guenther Quandt didn’t have a Nazi-kind of thinking,” said Jungbluth, the family biographer. “He was looking for any opportunity to expand his personal empire.”

Quandt’s youngest son, Harald, lived with his mother, Goebbels and six half-siblings. In 1939, he joined the German army after the country’s invasion of Poland, volunteering for the army’s paratrooper unit one year later.

During the war, Harald was deployed in Greece, France and Russia, before being shot and captured in Italy in 1944, and taken to the British Army-run POW camp in Benghazi where he received his mother’s farewell letter.

His stepfather also sent him a goodbye note.

“It’s likely that you’ll be the only one to remain who can continue the tradition of our family,” wrote Goebbels, who served as Chancellor of Germany for one day following Hitler’s suicide on April 30, 1945.

Denazification Hearings

After the war, Guenther Quandt served in an internment camp in Moosburg an der Isar for more than a year, before being judged a “Mitlaeufer” — a Nazi follower who wasn’t formally involved in the regime’s crimes — in denazification hearings in 1948. No repercussions followed.

“He was lucky that he wasn’t as prominent as someone like Flick or Krupp,” said Scholtyseck, referring to the German industrialists Friedrich Flick and Alfried Krupp, who were sentenced to prison terms at the Nuremberg war crimes trials.

Guenther died in 1954 while vacationing in Cairo, leaving his business empire equally in the hands of his two surviving sons, Harald and Herbert. Most notably, the assets included ownership of AFA and Deutsche Waffen-und Munitionsfabriken — renamed Industrie-Werke Karlsruhe AG after the war — and stakes in Daimler-Benz and potash miner Wintershall AG.

Sovereign Wealth

Herbert managed the stakes in the battery, car and potash firm, while Harald oversaw the interests in the industrial companies, according to Jungbluth’s biography.

Over the next decade, the brothers increased their stake in Daimler; Herbert saved BMW from collapse in the 1960s after becoming its largest shareholder and backing the development of new models.

Harald died in 1967, at age 45, in an airplane crash outside Turin, Italy. The relationship between his widow, Inge, and Herbert deteriorated after his death. Negotiations to settle the estate by separating assets commenced in 1970.

The most valuable asset that the Harald Quandt heirs received was four-fifths of a 14 percent stake in Daimler, according to the biography. In 1974, the entire stake was sold to the Kuwait Investment Authority, the country’s sovereign wealth fund, for about 1 billion deutsche marks, according to a Daimler-Benz publication from 1986 celebrating its centennial.

Inge Quandt, who suffered from depression, died of a heart attack on Christmas Eve 1978. Her new husband, Dr. Hans-Hilman von Halem, shot himself in the head on Boxing Day. The five orphaned daughters, two of them teenagers, were left to split the family fortune.

Family Meetings

The estate’s trustees had started overseeing the daughters’ money in 1974. An active investment approach commenced with the founding of the family investment company in 1981.

“It’s different if you work for a family than a corporation,” said Becker. “You can really invest instead of fulfilling regulation requirements.”

According to “Die Quandts,” the siblings try to get together a few times a year to discuss their investments. Gabriele Quandt lives in Munich. After earning a master’s degree in business administration at Insead in Fontainebleau, France, she married German publishing heir Florian Langenscheidt, with whom she had two sons. The couple divorced in 2008.

Katarina Geller-Herr owns Gestuet Waeldershausen, an equestrian center in Homberg (Ohm), Germany. She sponsored Lars Nieberg, a two-time Olympic gold medalist in show jumping.

Jewish Conversion

Colleen-Bettina Rosenblat-Mo is a jewelry designer who runs a studio and showroom in Hamburg. She converted to Judaism in New York at age 24. Her first marriage was to Michael Rosenblat, a German-Jewish businessman, whose father survived a concentration camp. The couple divorced in 1997. She remarried Frode Mo, a Norwegian journalist.

Anette-Angelika May-Thies lives in Hamburg, according to the Harald Quandt Holding shareholders list filed with the German federal trade registry. Her first marriage was to Axel May, a Goldman Sachs Group Inc. (GS) international adviser for private banking, who managed the family’s investments for about 25 years.

The siblings are also majority owners and investors in five financial services companies, all of which pay dividends, according to Becker. The firms were founded to manage the sisters’ wealth and subsequently opened up to third parties.

Private Equity

The six companies combined manage $18 billion in assets, according to the family investment company’s website. Becker said the majority of the money controlled by these firms is invested for third parties. One-fifth of the family fortune is managed by trustees for the two children of the youngest Quandt sibling, Patricia Halterman, who died in July 2005, four days before turning 38. Her Upper East Side townhouse sold for $37.5 million in 2008.

Auda International LP serves as the sisters’ New York-based private-equity unit. It manages almost $5 billion and was founded as their U.S. office in 1989, said Becker. Real Estate Capital Partners LP started the same year and has invested about $9 billion in real estate, according to its website. Both companies are owned through HQFS LP, an offshore entity based in the Cayman Islands.

In Bad Homburg, HQ Trust GmbH serves as a investment management company for about 30 families with fortunes ranging from 50 million euros to 500 million euros. Equita Management GmbH invests in small and mid-cap companies in Austria, Switzerland and Germany. HQ Advisor GmbH provides accounting and controlling services.

Only one sister, Gabriele, carries the family name, and none are active in the day-to-day business of the family office, said Becker.

‘Sad Truth’

Their uncle, Herbert Quandt, died in 1982. His fortune was divided between six children from three different marriages. BMW, his most valuable asset, was inherited by his third wife Johanna Quandt and their children, Stefan Quandt, 46, and Susanne Klatten, 50. The three billionaires hold 46.7 percent of the Munich-based car producer, according to the company’s 2011 annual report.

After Scholtyseck’s study was published in 2011, cousins Gabriele and Stefan Quandt acknowledged their family’s ties and involvement with the Third Reich in an interview with Germany’s Die Zeit newspaper.

“Magda killed her six children in the Fuehrerbunker. Our father loved his half-siblings very much. And when, like me, you have something like this in your family history, you think: It can’t be any worse,” Gabriele Quandt said in the interview. “It’s a sad truth that forced laborers died in Quandt companies,” said Stefan.

The acknowledgment didn’t prompt a public distancing from the men that made their family Germany’s richest. The families’ offices in Bad Homburg are named after Guenther and Harald Quandt, and the Herbert Quandt media prize of 50,000 euros is awarded annually to German journalists.

“They have to live with the name. It’s part of the history,” said Scholtyseck. “It will be a constant reminder of dictatorship and the challenges that families have to face.”

The Cardinal and the Truth: Mahony concealed decades of rape and intimidation of children

mahoney pope
Cardinal Mahony with the pope. (Photo: CNS/L’Osservatore Romano) April 20, 2012

nytimes.com | Jan 27, 2013

No member of the Roman Catholic hierarchy fought longer and more energetically than Cardinal Roger Mahony of Los Angeles to conceal the decades-long scandal involving the rape and intimidation of children by rogue priests. For years, the cardinal withheld seamy church records from parents, victims and the public, brandishing endless litigation and fatuous claims of confidentiality.

The breadth of Cardinal Mahony’s cover-up became shockingly clear last week with the release in court of archdiocese records detailing how he and a top aide concocted cynical strategies to keep police authorities in the dark and habitual offenders beyond the reach of criminal prosecution.

Cardinal Mahoney Hid Child Sex Abuse Cases

“Sounds good — please proceed!” the cardinal, now retired, instructed in 1987 after the aide, Msgr. Thomas Curry, cautioned against therapy for one confessed predator — lest the therapist feel obliged to tell authorities and scandalize the archdiocese. The two discussed another priest, Msgr. Peter Garcia, who admitted specializing in the rape of Latino immigrant children and threatened at least one boy with deportation if he complained. Cardinal Mahony ordered that he stay out of California after his release from a New Mexico treatment center out of fear that “we might very well have some type of legal action filed in both the criminal and civil sectors.” Monsignor Curry worried that there might be 20 young people able to identify the priest in “first-degree felony” cases.

It was the cardinal’s obligation under the primacy of secular law to instantly notify authorities of any priest’s criminal behavior. Instead, he invoked a nonexistent church privilege to hide miscreant clergy and shield the church and his own reputation. Cardinal Mahony has repeatedly apologized in recent years and insisted that the archdiocese was mending its ways. A lawyer for the archdiocese insisted that the scandal and the cardinal’s cover-up were “part of the past.” Not really. While statutes of limitations on possible criminal charges may have run out, Cardinal Mahony and his former aide could be deposed in civil suits. Monsignor Curry also managed to advance up the hierarchical ladder and would seem to merit instant removal from his current post as auxiliary bishop for Santa Barbara.

Assault Weapons Ban Lacks Democratic Votes to Pass Senate

feinstein
Senator Dianne Feinstein speaks next to a display of assault weapons during a news conference on Jan. 24, 2013 on Capitol Hill. Alex Wong/Getty Images

bloomberg.com | Jan 25, 2013

By Heidi Przybyla & Julie Hirschfeld Davis

A proposed ban on sales of assault weapons would be defeated in the U.S. Senate unless some lawmakers changed their current views, based on a Bloomberg review of recent lawmaker statements and interviews.

At least six of the 55 senators in the Democratic caucus have expressed skepticism or outright opposition to a ban, the review found. That means Democrats wouldn’t have a 51-vote majority to pass the measure, let alone the 60 needed to break a Republican filibuster to bring it to a floor vote.

A ban on the military-style weapons is among the legislative goals President Barack Obama outlined in his recommendations to Congress on curbing gun violence after the Dec. 14 Sandy Hook Elementary School slaughter of 20 children and six educators in Newtown, Connecticut. Vice President Joe Biden said yesterday it will take “persuasion and information” to gain the necessary support to enact the White House package.

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“We have an obligation to act — not wait,” Biden told reporters after a more than two-hour roundtable at Virginia Commonwealth University to discuss the administration’s push for new gun-safety measures.

Democratic Senator Dianne Feinstein of California unveiled on Jan. 24 legislation to outlaw sales of assault-style weapons during a news briefing where shooting survivors, some of them with bullets still lodged in their bodies, urged its passage.

At that event, Feinstein said it’s unclear whether the fight is winnable. “We don’t know, it’s so uphill,” she said. “It depends on the courage of Americans.”

New York Representative Carolyn McCarthy, who lost her husband in a 1993 shooting on a Long Island Rail Road train, said recent events have spurred a fresh start on the issue.

“We’re only at the beginning of our nation’s conversation about gun violence,” McCarthy said by e-mail. “There’s no way to know where the American people’s anger and frustration with” the Connecticut shooting “will ultimately take lawmakers.”

The five Democratic senators from traditionally pro-gun states who have expressed skepticism about the bill are Max Baucus and Jon Tester of Montana, Mark Begich of Alaska, Heidi Heitkamp of North Dakota and Joe Manchin of West Virginia. Independent Senator Angus King of Maine, who caucuses with Democrats, also said he opposes a ban.

Maine Senator Susan Collins, a Republican who supported similar legislation in 2004, has indicated she is unlikely to back the proposed ban in its current form.

In his comments yesterday, Biden made no mention of an assault weapons ban, and on Jan. 24 he downplayed its importance.

“I’m much less concerned, quite frankly, about what you call an assault weapon ban than I am about magazines and the number of rounds that can be held in a magazine,” Biden said.

The 1994 assault weapons ban, signed by President Bill Clinton, expired in 2004 and, until the shooting in Newtown, there’s been little effort in Congress to restore it.

The new legislation prohibits the sale or transfer of 158 of the most commonly owned military-style assault weapons. It would exempt all such guns legally possessed before passage of the law and exclude more than 2,200 hunting and sporting rifles.

Baucus, in a Jan. 16 statement, said that “before passing new laws, we need a thoughtful debate that respects responsible, law-abiding gun owners in Montana instead of a one-size-fits-all directive from Washington.”

“The answer isn’t simply in limiting guns,” said Andrea Helling, a spokeswoman for Tester. The senator also told a newspaper in Missoula, Montana, that an assault weapons ban wouldn’t have stopped the shootings in Newtown.

Begich said he was “not interested” in a ban, during a Jan. 10 conference call with reporters. “I don’t believe that we need to pile on new laws and suddenly that solves all the problems,” he said.

Manchin told CNN on Jan. 13 that “an assault weapons stand-alone ban on just guns alone will not, in the political reality that we have today, will not go anywhere.”

Heitkamp, referring to the Connecticut shooting, told North Dakota’s KXMB-TV and KXMC-TV on Jan. 15 that “there isn’t any amount of gun regulation or gun executive orders that will solve the problem of identifying people who could potentially do this and making sure they get the help and their families get the help so they don’t do this.”

Scott Ogden, a spokesman for King, said the senator “remains skeptical” about an assault weapons ban, though he was waiting for more details.

Collins is concerned that the proposed legislation is “far broader in the kinds of rifles that would be banned than was the case in the law in effect between 1994 and 2004,” said her spokesman, Kevin Kelley.

Further dimming prospects for the assault weapon ban, Senate Majority Leader Harry Reid of Nevada and Senator Mary Landrieu of Louisiana, both Democrats, voted against extending the previous ban in 2004. Neither has made any public statements since Newtown indicating a change in their positions.

Feinstein will be relying on survivor testimonials, along with images of the slain Sandy Hook students, most of them 6- year-olds, to push these Democrats to reconsider their opposition.

“The message to Democrats is, ‘See what your silence does?’” Feinstein told reporters. “There will be more of these. These won’t end.”

“If just reading the list of beautiful names and looking into the eyes of some of the pictures of the children slain doesn’t do something to the conscience of America, nothing I can say or do will,” she said.

The vote shortage for a ban may prompt Democrats to focus on another major goal that is also part of the Feinstein bill: banning high-capacity magazines that have been used in many of the U.S. shootings over the past decade to fire off numerous bullets in a matter of seconds from autoloading guns.

Senator Frank Lautenberg, a New Jersey Democrat, introduced separate legislation on Jan. 22 to ban the manufacture and sale of ammunition magazines that hold more than 10 rounds.

In the Tucson, Arizona, shooting two years ago that severely injured former Democratic Representative Gabrielle Giffords of Arizona, Jared Lee Loughner fired 31 bullets in 15 seconds from a Glock 19 semiautomatic pistol. He was tackled while reloading. An assault rifle with a 100-round magazine was among the weapons alleged gunman James Holmes used to kill 12 and wound 58 in July 2012 at an Aurora, Colorado, movie theater.

Mark Kelly, Giffords’s husband and a gun-control advocate, will testify at a Jan. 30 Senate Judiciary Committee hearing on gun violence, Vermont Democrat Patrick Leahy, the panel’s chairman, announced yesterday. Kelly will be joined by witnesses including Wayne LaPierre, the chief executive officer of the National Rifle Association, which opposes new restrictions.

Some of the lawmakers skeptical of the assault-weapons ban did express support for a prohibition on high-capacity magazines that can hold more than 10 bullets, as well increased background checks for firearm purchases.

“Congress must act to implement magazine capacity restrictions,” King spokesman Ogden said in a statement.

King is also “generally supportive of expanded background checks,” Ogden said.

Collins “supports a reasonable limitation on the number of rounds of ammunition in a magazine,” spokesman Kelley said.

Biden, who Obama tapped to develop recommendations for action after the Connecticut shooting, said there would be more trips outside of Washington to discuss the issue. Yesterday, he called the Newtown massacre “a national tragedy and a window into a vulnerability people feel about their safety and the safety of their children.”

The White House’s campaign-style effort is designed to build political pressure on Congress to take action.

“I have no illusions about what needs to be done and how difficult it will be,” Biden said in an e-mail sent yesterday to Obama supporters. “Each one of us needs to speak up and demand action,” he wrote, concluding: “Let’s get this done.”

The private roundtable Biden conducted in Virginia included cabinet officials, Democratic lawmakers, and members of the state-appointed review board that investigated the 2007 shooting that killed 33 people at Virginia Polytechnic Institute and State University, known as Virginia Tech, in the deadliest gun massacre in U.S. history.

That incident prompted passage of a 2008 law improving state reporting to the National Instant Criminal Background Check System, aimed at barring criminals or mentally ill individuals from obtaining guns.

Biden said the group discussed the need for strengthening that system and implementing universal background checks with better and timelier information from states. He said they also talked about the “woefully inadequate” number of trained mental-health professionals available around the country.

Manchin told a West Virginia radio interviewer Jan. 24 that he is working with senators of both parties to require most gun purchasers, including those at weapons shows, to undergo checks.

“If you’re going to be a gun owner, you should have a background check and be able to pass a background check,” he said. Exceptions should be made in cases where a gun is transferred from one family member to another, and when a weapon is being obtained for use at a sporting event.

Manchin said private sellers at gun shows have an “unfair advantage” because they don’t have to perform background checks while a licensed dealer does.