Iceland, Prosecutor of Bankers, Sees Meager Returns

Ilvy Njiokiktjien for The New York Times

"Greed is not a crime. But the question is: where does greed lead?" said Olafur Hauksson, a special prosecutor in Reykjavik.

REYKJAVIK, Iceland — As chief of police in a tiny fishing town for 11 years, Olafur Hauksson developed what he thought was a basic understanding of the criminal mind. The typical lawbreaker, he said, recalling his many encounters with small-time criminals, “clearly knows that he crossed the line” and generally sees “the difference between right and wrong.”

Today, the burly, 48-year-old former policeman is struggling with a very different sort of suspect. Reassigned to Reykjavik, the Icelandic capital, to lead what has become one of the world’s most sweeping investigation into the bankers whose actions contributed to the global financial crisis in 2008, Mr. Hauksson now faces suspects who “are not aware of when they crossed the line” and “defend their actions every step of the way.”

With the global economy still struggling to recover from the financial maelstrom five years ago, governments around the world have been criticized for largely failing to punish the bankers who were responsible for the calamity. But even here in Iceland, a country of just 320,000 that has gone after financiers with far more vigor than the United States and other countries hit by the crisis, obtaining criminal convictions has proved devilishly difficult.

Public hostility toward bankers is so strong in Iceland that “it is easier to say you are dealing drugs than to say you’re a banker,” said Thorvaldur Sigurjonsson, the former head of trading for Kaupthing, a once high-flying bank that crumbled. He has been called in for questioning by Mr. Hauksson’s office but has not been charged with any wrongdoing.

Yet, in the four years since the Icelandic Parliament passed a law ordering the appointment of an unnamed special prosecutor to investigate those blamed for the country’s spectacular meltdown in 2008, only a handful of bankers have been convicted.

Ministers in a left-leaning coalition government elected after the crash agree that the wheels of justice have ground slowly, but they call for patience, explaining that the process must follow the law, not vengeful passions.

“We are not going after people just to satisfy public anger,” said Steingrimur J. Sigfusson, Iceland’s minister of industry, a former finance minister and leader of the Left-Green Movement that is part of the governing coalition.

Hordur Torfa, a popular singer-songwriter who helped organize protests that forced the previous conservative government to resign, acknowledged that “people are getting impatient” but said they needed to accept that “this is not the French Revolution. I don’t believe in taking bankers out and hanging them or shooting them.”

Others are less patient. “The whole process is far too slow,” said Thorarinn Einarsson, a left-wing activist. “It only shows that ‘banksters’ can get away with doing whatever they want.”

Mr. Hauksson, the special prosecutor, said he was frustrated by the slow pace but thought it vital that his office scrupulously follow legal procedure. “Revenge is not something we want as our main driver in this process. Our work must be proper today and be seen as proper in the future,” he said.

Part of the difficulty in prosecuting bankers, he said, is that the law is often unclear on what constitutes a criminal offense in high finance. “Greed is not a crime,” he noted. “But the question is: where does greed lead?”

Mr. Hauksson said it was often easy to show that bankers violated their own internal rules for lending and other activities, but “as in all cases involving theft or fraud, the most difficult thing is proving intent.”

And there are the bankers themselves. Those who have been brought in for questioning often bristle at being asked to account for their actions. “They are not used to being questioned. These people are not used to finding themselves in this situation,” Mr. Hauksson said. They also hire expensive lawyers.

The special prosecutor’s office initially had only five staff members but now has more than 100 investigators, lawyers and financial experts, and it has relocated to a big new office. It has opened about 100 cases, with more than 120 people now under investigation for possible crimes relating to an Icelandic financial sector that grew so big it dwarfed the rest of the economy.

To help ease Mr. Hauksson’s task, legislators amended the law to allow investigators easy access to confidential bank information, something that previously required a court order.

Parliament also voted to put the country’s prime minister at the time of the banking debacle on trial for negligence before a special tribunal. (A proposal to try his cabinet failed.) Mr. Hauksson was not involved in the case against the former leader, Geir H. Haarde, who last year was found guilty of failing to keep ministers properly informed about the 2008 crisis but was acquitted on more serious charges that could have resulted in a prison sentence.

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Concerns About A.D.H.D. Practices and Amphetamine Addiction

Before his addiction, Richard Fee was a popular college class president and aspiring medical student. "You keep giving Adderall to my son, you're going to kill him," said Rick Fee, Richard's father, to one of his son's doctors.

VIRGINIA BEACH — Every morning on her way to work, Kathy Fee holds her breath as she drives past the squat brick building that houses Dominion Psychiatric Associates.

Andrea Mohin/The New York Times

MENTAL HEALTH CLINIC Dominion Psychiatric Associates in Virginia Beach, where Richard Fee was treated by Dr. Waldo M. Ellison. After observing Richard and hearing his complaints about concentration, Dr. Ellison diagnosed attention deficit hyperactivity disorder and prescribed the stimulant Adderall.

It was there that her son, Richard, visited a doctor and received prescriptions for Adderall, an amphetamine-based medication for attention deficit hyperactivity disorder. It was in the parking lot that she insisted to Richard that he did not have A.D.H.D., not as a child and not now as a 24-year-old college graduate, and that he was getting dangerously addicted to the medication. It was inside the building that her husband, Rick, implored Richard’s doctor to stop prescribing him Adderall, warning, “You’re going to kill him.”

It was where, after becoming violently delusional and spending a week in a psychiatric hospital in 2011, Richard met with his doctor and received prescriptions for 90 more days of Adderall. He hanged himself in his bedroom closet two weeks after they expired.

The story of Richard Fee, an athletic, personable college class president and aspiring medical student, highlights widespread failings in the system through which five million Americans take medication for A.D.H.D., doctors and other experts said.

Medications like Adderall can markedly improve the lives of children and others with the disorder. But the tunnel-like focus the medicines provide has led growing numbers of teenagers and young adults to fake symptoms to obtain steady prescriptions for highly addictive medications that carry serious psychological dangers. These efforts are facilitated by a segment of doctors who skip established diagnostic procedures, renew prescriptions reflexively and spend too little time with patients to accurately monitor side effects.

Richard Fee’s experience included it all. Conversations with friends and family members and a review of detailed medical records depict an intelligent and articulate young man lying to doctor after doctor, physicians issuing hasty diagnoses, and psychiatrists continuing to prescribe medication — even increasing dosages — despite evidence of his growing addiction and psychiatric breakdown.

Very few people who misuse stimulants devolve into psychotic or suicidal addicts. But even one of Richard’s own physicians, Dr. Charles Parker, characterized his case as a virtual textbook for ways that A.D.H.D. practices can fail patients, particularly young adults. “We have a significant travesty being done in this country with how the diagnosis is being made and the meds are being administered,” said Dr. Parker, a psychiatrist in Virginia Beach. “I think it’s an abnegation of trust. The public needs to say this is totally unacceptable and walk out.”

Young adults are by far the fastest-growing segment of people taking A.D.H.D medications. Nearly 14 million monthly prescriptions for the condition were written for Americans ages 20 to 39 in 2011, two and a half times the 5.6 million just four years before, according to the data company I.M.S. Health. While this rise is generally attributed to the maturing of adolescents who have A.D.H.D. into young adults — combined with a greater recognition of adult A.D.H.D. in general — many experts caution that savvy college graduates, freed of parental oversight, can legally and easily obtain stimulant prescriptions from obliging doctors.

“Any step along the way, someone could have helped him — they were just handing out drugs,” said Richard’s father. Emphasizing that he had no intention of bringing legal action against any of the doctors involved, Mr. Fee said: “People have to know that kids are out there getting these drugs and getting addicted to them. And doctors are helping them do it.”

“...when he was in elementary school he fidgeted, daydreamed and got A’s. he has been an A-B student until mid college when he became scattered and he wandered while reading He never had to study. Presently without medication, his mind thinks most of the time, he procrastinated, he multitasks not finishing in a timely manner.”

Dr. Waldo M. Ellison

Richard Fee initial evaluation

Feb. 5, 2010

Richard began acting strangely soon after moving back home in late 2009, his parents said. He stayed up for days at a time, went from gregarious to grumpy and back, and scrawled compulsively in notebooks. His father, while trying to add Richard to his health insurance policy, learned that he was taking Vyvanse for A.D.H.D.

Richard explained to him that he had been having trouble concentrating while studying for medical school entrance exams the previous year and that he had seen a doctor and received a diagnosis. His father reacted with surprise. Richard had never shown any A.D.H.D. symptoms his entire life, from nursery school through high school, when he was awarded a full academic scholarship to Greensboro College in North Carolina. Mr. Fee also expressed concerns about the safety of his son’s taking daily amphetamines for a condition he might not have.

“The doctor wouldn’t give me anything that’s bad for me,” Mr. Fee recalled his son saying that day. “I’m not buying it on the street corner.”

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Concerns About A.D.H.D. Practices and Amphetamine Addiction

Before his addiction, Richard Fee was a popular college class president and aspiring medical student. "You keep giving Adderall to my son, you're going to kill him," said Rick Fee, Richard's father, to one of his son's doctors.

VIRGINIA BEACH — Every morning on her way to work, Kathy Fee holds her breath as she drives past the squat brick building that houses Dominion Psychiatric Associates.

Andrea Mohin/The New York Times

MENTAL HEALTH CLINIC Dominion Psychiatric Associates in Virginia Beach, where Richard Fee was treated by Dr. Waldo M. Ellison. After observing Richard and hearing his complaints about concentration, Dr. Ellison diagnosed attention deficit hyperactivity disorder and prescribed the stimulant Adderall.

It was there that her son, Richard, visited a doctor and received prescriptions for Adderall, an amphetamine-based medication for attention deficit hyperactivity disorder. It was in the parking lot that she insisted to Richard that he did not have A.D.H.D., not as a child and not now as a 24-year-old college graduate, and that he was getting dangerously addicted to the medication. It was inside the building that her husband, Rick, implored Richard’s doctor to stop prescribing him Adderall, warning, “You’re going to kill him.”

It was where, after becoming violently delusional and spending a week in a psychiatric hospital in 2011, Richard met with his doctor and received prescriptions for 90 more days of Adderall. He hanged himself in his bedroom closet two weeks after they expired.

The story of Richard Fee, an athletic, personable college class president and aspiring medical student, highlights widespread failings in the system through which five million Americans take medication for A.D.H.D., doctors and other experts said.

Medications like Adderall can markedly improve the lives of children and others with the disorder. But the tunnel-like focus the medicines provide has led growing numbers of teenagers and young adults to fake symptoms to obtain steady prescriptions for highly addictive medications that carry serious psychological dangers. These efforts are facilitated by a segment of doctors who skip established diagnostic procedures, renew prescriptions reflexively and spend too little time with patients to accurately monitor side effects.

Richard Fee’s experience included it all. Conversations with friends and family members and a review of detailed medical records depict an intelligent and articulate young man lying to doctor after doctor, physicians issuing hasty diagnoses, and psychiatrists continuing to prescribe medication — even increasing dosages — despite evidence of his growing addiction and psychiatric breakdown.

Very few people who misuse stimulants devolve into psychotic or suicidal addicts. But even one of Richard’s own physicians, Dr. Charles Parker, characterized his case as a virtual textbook for ways that A.D.H.D. practices can fail patients, particularly young adults. “We have a significant travesty being done in this country with how the diagnosis is being made and the meds are being administered,” said Dr. Parker, a psychiatrist in Virginia Beach. “I think it’s an abnegation of trust. The public needs to say this is totally unacceptable and walk out.”

Young adults are by far the fastest-growing segment of people taking A.D.H.D medications. Nearly 14 million monthly prescriptions for the condition were written for Americans ages 20 to 39 in 2011, two and a half times the 5.6 million just four years before, according to the data company I.M.S. Health. While this rise is generally attributed to the maturing of adolescents who have A.D.H.D. into young adults — combined with a greater recognition of adult A.D.H.D. in general — many experts caution that savvy college graduates, freed of parental oversight, can legally and easily obtain stimulant prescriptions from obliging doctors.

“Any step along the way, someone could have helped him — they were just handing out drugs,” said Richard’s father. Emphasizing that he had no intention of bringing legal action against any of the doctors involved, Mr. Fee said: “People have to know that kids are out there getting these drugs and getting addicted to them. And doctors are helping them do it.”

“...when he was in elementary school he fidgeted, daydreamed and got A’s. he has been an A-B student until mid college when he became scattered and he wandered while reading He never had to study. Presently without medication, his mind thinks most of the time, he procrastinated, he multitasks not finishing in a timely manner.”

Dr. Waldo M. Ellison

Richard Fee initial evaluation

Feb. 5, 2010

Richard began acting strangely soon after moving back home in late 2009, his parents said. He stayed up for days at a time, went from gregarious to grumpy and back, and scrawled compulsively in notebooks. His father, while trying to add Richard to his health insurance policy, learned that he was taking Vyvanse for A.D.H.D.

Richard explained to him that he had been having trouble concentrating while studying for medical school entrance exams the previous year and that he had seen a doctor and received a diagnosis. His father reacted with surprise. Richard had never shown any A.D.H.D. symptoms his entire life, from nursery school through high school, when he was awarded a full academic scholarship to Greensboro College in North Carolina. Mr. Fee also expressed concerns about the safety of his son’s taking daily amphetamines for a condition he might not have.

“The doctor wouldn’t give me anything that’s bad for me,” Mr. Fee recalled his son saying that day. “I’m not buying it on the street corner.”

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Slipstream: Consumer Data Protection Laws, an Ocean Apart

OVER the years, the United States and Europe have taken different approaches toward protecting people’s personal information. Now the two sides are struggling to bridge that divide.

On this side of the Atlantic, Congress has enacted a patchwork quilt of privacy laws that separately limit the use of Americans’ medical records, credit reports, video rental records and so on. On the other side, the European Union has instituted more of a blanket regulatory system; it has a common directive that gives its citizens certain fundamental rights — like the right to obtain copies of records held about them by companies and institutions — that Americans now lack.

Even so, United States officials maintain that the divergent approaches are equal. “The sum of the parts of U.S. privacy protection is equal to or greater than the single whole of Europe,” says Cameron F. Kerry, general counsel of the Commerce Department. He is overseeing an agency effort to help develop voluntary, enforceable codes of conduct for industry groups, like app developers, whose collection and use of consumer data are now unregulated.

Europe begs to differ.

“Yes, we share the basic idea of privacy,” says Peter Hustinx, Europe’s data protection supervisor. “But there is a huge deficit on the U.S. side.”

Alas, the data-control divide appears to be widening.

A year ago, the European Commission proposed comprehensive reforms to strengthen online privacy rights — changes that could have big repercussions for American technology companies and marketers that operate in the European Union. American officials, trade groups and tech executives have responded by taking frequent treks to Brussels and other cities, where they have urged regulators and legislators to reconsider the one-regulation-fits-all-data approach. What’s at stake, American industry representatives say, is nothing less than a free and commerce-friendly Internet.

“The ecosystem of the Internet is very delicate,” says Kevin Richards, senior vice president of federal government affairs at TechAmerica, a trade group that represents companies like Google and Microsoft. “It’s not wise to have an overly broad, prescriptive, one-size-fits-all approach that would hinder or undermine the ability of companies to innovate in a global economy.”

European Union members already have data protection laws in place, based on a directive from 1995 that laid out principles for the collection of personal information. The proposed new rules would strengthen some existing provisions. They would standardize data protections across the 27 member states. They would also provide some new rights, such as “data portability” — the right of consumers to easily transfer their text files, photographs and videos from one social network, or e-mail or cloud storage service, to another. And they would subject companies that violate the rules to penalties of up to 2 percent of their annual global revenue.

Asked for comment, Viviane Reding, the vice president of the European Commission and the architect of the proposed regulation, said in a statement: “The main problem is that our rules predate the digital age and it became increasingly clear in recent years that they needed an update.” She continued: “That is why I have proposed a root-and-branch reform of the E.U.’s data protection rules — currently under discussion in the European Parliament and the Council of the E.U. — that will both protect citizens’ rights and facilitate business in the digital age.”

BUT some provisions seem too rigid to United States officials and trade groups. They argue that the American approach — sector-specific privacy laws, in addition to industry self-regulation and enforcement by the Federal Trade Commission — is more nimble.

“We hope that Europe will move in the direction of those multistakeholder standards, and not standards which are not flexible and don’t move at Internet speed,” says Mr. Kerry, who has taken at least four trips to European cities in the last year to discuss these issues.

From the perspective of some European legislators, however, United States representatives seem more interested in protecting commerce than consumers. The full-court American effort may have backfired, they say, pushing some European officials toward even broader measures. Last month, Jan Philipp Albrecht, a representative of the European Parliament who reviewed the draft regulation, proposed additional rights for citizens — like the right not to be subject to consumer profiling.

“My impression is that the U.S. Chamber of Commerce and the Commerce Department are mostly just following the interests of Silicon Valley,” he says. “This leads to heavy pressure on the European regulator, I can say.”

But Mr. Kerry says the United States must make its views known if the systems are to work in concert.

“I know that some people have raised eyebrows at our involvement; I make no apologies,” Mr. Kerry says. “We in the United States and countries and businesses around the world are stakeholders in this process. This has an important impact on the global economy.”

The solution to this trans-Atlantic clash may simply be American ingenuity.

Last year, President Barack Obama proposed a “Consumer Privacy Bill of Rights” that would give Americans many of the same baseline protections that the draft European rule proposes to reinforce. These include the right of access to records that companies hold about them, the right to correct those records and the right to have limits on the personal data that companies collect and keep. Administration officials said they would work with Congress on legislation based on those rights and to extend oversight to industries not currently covered by federal privacy laws.

A coalition of more than a dozen American advocacy groups said it would send a letter on Monday to senior Obama administration officials, seeking a meeting to ensure that American policy makers’ efforts in Europe “are not averse to the views expressed by the president.” The coalition includes the Electronic Privacy Information Center and the Center for Digital Democracy.

“Does the Obama administration really want to be on the opposite side of the European effort to upgrade and modernize its privacy law which is at its core about the protection of a fundamental freedom?” asks Marc Rotenberg, executive director of the Electronic Privacy Information Center.

European officials hold out hope that Congress will enact baseline consumer privacy protections for Americans.

“This development — which is much welcomed in Europe — shows that we have much in common,” Ms. Reding of the European Commission said in her statement, speaking of the privacy bill of rights. “Convergence is springing up and synergies are possible.”

E-mail: slipstream@nytimes.com.

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Lady Malcolm Douglas-Hamilton Dies at 103; Aided Britain in War

Wide World Photos

Lady Malcolm Douglas-Hamilton, then Natalie Latham, in 1941. She started Bundles for Britain.

In 1939, Lady Malcolm Douglas-Hamilton, who died on Jan. 14 at 103, had neither that title nor that name. She was Natalie Latham, a fixture of Manhattan society whose beauty drew notice in Vogue magazine. She had achieved a dollop of fame when she and her two young daughters, nicknamed Mimi and Bubbles, appeared together in matching swimwear in a Life magazine photo spread, having captivated a photographer at a beach club one day.

Mrs. Latham, deft with a needle and thread, had made the outfits herself.

At the time, England had declared war on Germany, whose navy was attacking British ships. It was then, already twice divorced at 30, that Mrs. Latham paused to take stock of her life. A former debutante, she had family wealth, a Revolutionary War pedigree and an Upper East Side address. She was busy enough, organizing charity balls, herding two rambunctious children about town and making her own clothes. Like most Americans, she did not want the United States to join the war, but she felt private citizens ought to help somehow.

“I had never had time to think before,” she said in an interview with The New Yorker in 1941. “I began to think of Britain.”

It was a turning point in a life of privilege that led to one of the 20th century’s most inspired relief efforts. Nearly two years before the United States entered World War II, Mrs. Latham started Bundles for Britain, an organization that initially consisted of a few New York women knitting socks and caps for British sailors. It would grow to embrace 1.5 million volunteers in 1,900 branches in every state in the union and begin shipping to Britain not only hundreds of thousands of knitted items but also ambulances, X-ray machines and children’s cots — all labeled “From your American friends.”

Manhattan society matrons pitched in, along with sheepherders in Oregon, apple growers in Michigan and Indian blanket makers in Oklahoma. South Carolinians raised money with a watermelon-eating contest. Women everywhere baked cakes and took in laundry to buy yarn.

Letters of thanks poured in (“Dear Bundles,” most said), so Mrs. Latham sought help in replying to them, recruiting eight women, all former debutantes, at the Stork Club, one of her favorite haunts. For help on the English end, she enlisted Janet Murrow, wife of the legendary CBS reporter Edward R. Murrow, whose live radio broadcasts from London brought the war home to Americans; Louise Carnegie, wife of the industrialist Andrew Carnegie; and Clementine Churchill, wife of the prime minister. (Mrs. Churchill sent wish lists back to New York.)

Joan Crawford asked her fans to forgo giving her holiday presents and contribute instead to Bundles. For a raffle, Queen Elizabeth the Queen Mother, mother of the current queen, donated a bejeweled cigarette case in red (rubies), white (diamonds) and blue (sapphires), as well as a piece of shrapnel from the bomb that had hit Buckingham Palace.

“It’s like a fairy tale,” Mrs. Latham told The New Yorker. “I just go around pinching myself, it’s so thrilling.”

It was also exhausting: she sometimes collapsed at her desk with fatigue. King George VI made her an honorary Commander of the British Empire, the first non-British woman to be so honored.

She died at a nursing home in Andover, N.J., her family said. After living for many years on the Upper East Side, she had retired to Stillwater, N.J.

Bundles for Britain, which continued through the war, was but one milestone in the life of Lady Malcolm Douglas-Hamilton. At the request of the White House, she created a spinoff group, Bundles for America, to aid Americans in need during the war; one project involved scavenging junkyards for upholstery to make into clothing.

In 1947 she founded and became president of Common Cause (not to be confused with the liberal government watchdog group started in 1970), a moderate anti-Communist organization whose leaders included the historian Arthur M. Schlesinger Jr. She formed a group to aid Haiti; another to stem erosion of the nation’s morals; and still another to encourage good taste. (That group built the House of Good Taste at the 1964 World’s Fair in New York.)

In the mid-1940s she worked for The New York Times Company as a liaison to women’s groups.

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Media Decoder Blog: In Wake of Restructuring, NBC News President Quits

8:30 p.m. | Updated

The longest-serving president of any of the three network news divisions, Steve Capus of NBC News, stepped down from his position on Friday, six months after Comcast restructured its news units in a way that diminished his authority.

Pat Fili-Krushel, chairwoman of the NBCUniversal News Group, said in a brief telephone interview on Friday that she would “cast a wide net” while searching for a successor to Mr. Capus. In the interim, the leaders of the news division will report directly to her.

Ms. Fili-Krushel became Mr. Capus’s boss last July when Steve Burke, the chief executive of NBCUniversal, consolidated all of NBC’s news units — NBC News, the cable news channels MSNBC and CNBC, and its stake in the Weather Channel — under a new umbrella, the NBCUniversal News Group. Mr. Burke asked Ms. Fili-Krushel, one of his most trusted lieutenants, to run it, while keeping Mr. Capus and the heads of the other units in place.

Ms. Fili-Krushel worked early in her career at HBO and Lifetime. A veteran of the Walt Disney Company, where she helped program ABC, and  Time Warner, where she was an administrator, she is by her own admission not a journalist.  But now she is, by default, the highest-ranking woman in the American television news industry — not just at the moment, but in the history of the medium. The heads of the news divisions at ABC and CBS are men, as are the heads of the Fox News Channel, CNN, and Bloomberg.

Ms. Fili-Krushel has kept a low public profile, but has been a forceful presence behind the scenes, recently moving from her office on the 51st floor of 30 Rockefeller Center, near Mr. Burke’s, to a new one on the third floor, where NBC News is based. On Friday, she said she had spent her first six months “learning, listening and getting to know the players here.” She called the News Group an “unbelievably strong organization.”

Though Mr. Capus’s exit saddened many at NBC News on Friday, it came as little surprise. He had previously reported directly to Mr. Burke, but after the restructuring he reported to Ms. Fili-Krushel, and he made no secret of his unhappiness with the change. His contract had a clause that allowed him to leave in the event that he no longer reported to Mr. Burke, according to two people with direct knowledge of the arrangement at NBC, and he decided to exercise that right after months of contemplation. The people insisted on anonymity because they were not authorized by the network to speak publicly.

Mr. Capus told Ms. Fili-Krushel of his intent to leave last Friday. It is likely that he would have left sooner, but a series of major news stories kept him busy late last year — including Hurricane Sandy, the presidential election and the school shooting in Newtown, Conn. Mr. Capus also oversaw the network’s response to the kidnapping of Richard Engel and an NBC News crew in Syria last month.

“It has been a privilege to have spent two decades here, but it is now time to head in a new direction,” he wrote in an e-mail to staff members on Friday afternoon.

Mr. Capus guided NBC through a revolutionary time in news-gathering and distribution. He maintained the news division’s profitability, managed tensions between NBC News and its increasingly liberal cable channel MSNBC, and fostered new business ventures like an in-house production company and an annual education summit. Last year, he unwound an old deal with Microsoft to give the news division complete control over its Web site, now named NBCNews.com, for the first time.

Ms. Fili-Krushel wrote in a separate e-mail to staff members that “NBC News is America’s leading source of television news and Steve has been a big part of that success.”

NBC News is the producer of the most popular evening newscast in the country. But its single biggest source of profits, the morning show “Today,” fell to second place last year, behind ABC’s “Good Morning America,” for the first time since the 1990s. The decline caused widespread anxiety inside the news division and speculation that Mr. Capus would be relieved of his duties.

Inside NBC, both Mr. Capus and the executive producer of “Today,” Jim Bell, received much of the blame for the botched removal of Ann Curry from “Today” last June, which worsened the show’s already tenuous position in the ratings. Ms. Fili-Krushel was put in charge just a few weeks later.

Mr. Bell was replaced at “Today” last fall and is now the executive producer for NBC Olympics. Savannah Guthrie is now the co-host of “Today,” and Ms. Curry is a national and international correspondent for the network, but is rarely seen. Mr. Capus’s exit was seen by some at the network as the last shoe that had to drop.

In his e-mail to staff members, Mr. Capus called it an “extremely difficult decision to walk away,” noting that he started at NBC as a producer 20 years ago this month. He did not make any mention of what he would do next. “Journalism is, indeed, a noble calling, and I have much I hope to accomplish in the next phase of my career,” he wrote.

“Today” continues to lose to ABC’s “Good Morning America” among total viewers, but lately it has won a few weeks in the 25- to 54-year-old demographic that advertisers covet.

“NBC Nightly News” has more successfully fended off ABC’s “World News,” despite an aggressive push by ABC. Mr. Capus said, “NBC News has grown in all key metrics — from ratings and reputation to profitability.”

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Birth Control Rule Altered to Allay Religious Objections

WASHINGTON — The Obama administration on Friday proposed yet another compromise to address strenuous objections from religious organizations about a policy requiring health insurance plans to provide free contraceptives, but the change did not end the political furor or legal fight over the issue.

The proposal could expand the number of groups that do not need to pay directly for birth control coverage, encompassing not only churches and other religious organizations, but also some religiously affiliated hospitals, universities and social service agencies. Health insurance companies would pay for the coverage.

The latest proposed change is the third in the last 15 months, all announced on Fridays, as President Obama has struggled to balance women’s rights, health care and religious liberty. Legal experts said the fight could end up in the Supreme Court.

Kathleen Sebelius, the secretary of health and human services, said the proposal would guarantee free coverage of birth control “while respecting religious concerns.”

But Kyle Duncan, the general counsel of the Becket Fund for Religious Liberty in Washington, which is representing employers in eight lawsuits, said the litigation would continue. “Today’s proposed rule does nothing to protect the religious freedom of millions of Americans,” Mr. Duncan said.

Religious groups dissatisfied with the new proposal want a broader, more explicit exemption for religious organizations and protection for secular businesses owned by people with religious objections to contraceptive coverage.

The tortured history of the rule has played out in several chapters. The Obama administration first issued standards requiring insurers to cover contraceptives for women in August 2011, less than a month after receiving recommendations to that effect from the National Academy of Sciences. In January 2012, the administration rejected a broad exemption sought by the Roman Catholic Church for insurance provided by Catholic hospitals, colleges and charities. After a firestorm of criticism from Catholic bishops and Republican lawmakers, the administration offered a possible compromise that February. But it left many questions unanswered and did not say how coverage would be provided for self-insured religious organizations.

Under the new proposal, churches and nonprofit religious organizations that object to providing birth control coverage on religious grounds would not have to pay for it.

Female employees could get free contraceptive coverage through a separate plan that would be provided by a health insurer. Institutions objecting to the coverage would not pay for the contraceptives.

Insurance companies would bear the cost of providing the separate coverage, with the possibility of recouping the costs through lower health care expenses resulting in part from fewer births.

Chiquita Brooks-LaSure, who helped develop the proposal as deputy director of the federal office that regulates health insurance, said: “Under the proposed rule, insurance companies — not churches or other religious organizations — will cover contraceptive services. No nonprofit religious institution will be forced to pay for or provide contraceptive coverage, and churches and houses of worship are specifically exempt.”

Moreover, she said, “Nonprofit religious organizations like universities, hospitals or charities with religious objections won’t have to arrange, contract or pay for coverage of these services for their employees or students.”

But some of the lawsuits objecting to the plan have been filed by businesses owned by people who say they have religious reasons for not wanting to provide contraceptive coverage. Under the proposed rule, “for-profit secular employers” would have to provide birth control coverage to employees, even if the business owners had a religious objection to the idea.

Read More..

Birth Control Rule Altered to Allay Religious Objections

WASHINGTON — The Obama administration on Friday proposed yet another compromise to address strenuous objections from religious organizations about a policy requiring health insurance plans to provide free contraceptives, but the change did not end the political furor or legal fight over the issue.

The proposal could expand the number of groups that do not need to pay directly for birth control coverage, encompassing not only churches and other religious organizations, but also some religiously affiliated hospitals, universities and social service agencies. Health insurance companies would pay for the coverage.

The latest proposed change is the third in the last 15 months, all announced on Fridays, as President Obama has struggled to balance women’s rights, health care and religious liberty. Legal experts said the fight could end up in the Supreme Court.

Kathleen Sebelius, the secretary of health and human services, said the proposal would guarantee free coverage of birth control “while respecting religious concerns.”

But Kyle Duncan, the general counsel of the Becket Fund for Religious Liberty in Washington, which is representing employers in eight lawsuits, said the litigation would continue. “Today’s proposed rule does nothing to protect the religious freedom of millions of Americans,” Mr. Duncan said.

Religious groups dissatisfied with the new proposal want a broader, more explicit exemption for religious organizations and protection for secular businesses owned by people with religious objections to contraceptive coverage.

The tortured history of the rule has played out in several chapters. The Obama administration first issued standards requiring insurers to cover contraceptives for women in August 2011, less than a month after receiving recommendations to that effect from the National Academy of Sciences. In January 2012, the administration rejected a broad exemption sought by the Roman Catholic Church for insurance provided by Catholic hospitals, colleges and charities. After a firestorm of criticism from Catholic bishops and Republican lawmakers, the administration offered a possible compromise that February. But it left many questions unanswered and did not say how coverage would be provided for self-insured religious organizations.

Under the new proposal, churches and nonprofit religious organizations that object to providing birth control coverage on religious grounds would not have to pay for it.

Female employees could get free contraceptive coverage through a separate plan that would be provided by a health insurer. Institutions objecting to the coverage would not pay for the contraceptives.

Insurance companies would bear the cost of providing the separate coverage, with the possibility of recouping the costs through lower health care expenses resulting in part from fewer births.

Chiquita Brooks-LaSure, who helped develop the proposal as deputy director of the federal office that regulates health insurance, said: “Under the proposed rule, insurance companies — not churches or other religious organizations — will cover contraceptive services. No nonprofit religious institution will be forced to pay for or provide contraceptive coverage, and churches and houses of worship are specifically exempt.”

Moreover, she said, “Nonprofit religious organizations like universities, hospitals or charities with religious objections won’t have to arrange, contract or pay for coverage of these services for their employees or students.”

But some of the lawsuits objecting to the plan have been filed by businesses owned by people who say they have religious reasons for not wanting to provide contraceptive coverage. Under the proposed rule, “for-profit secular employers” would have to provide birth control coverage to employees, even if the business owners had a religious objection to the idea.

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Washington Post Joins List of News Media Hacked by the Chinese

SAN FRANCISCO — The question is no longer who has been hacked. It’s who hasn’t?

The Washington Post can be added to the growing list of American news organizations whose computers have been penetrated by Chinese hackers.

After The New York Times reported on Wednesday that its computers as well as those of Bloomberg News had been attacked by Chinese hackers, The Wall Street Journal said on Thursday that it too had been a victim of Chinese cyberattacks.

According to people with knowledge of an investigation at The Washington Post, its computer systems were also attacked by Chinese hackers in 2012. A former Post employee said there had been hacking attempts at the Washington Post for at least four years, but none targeted the company’s newsroom. Then, last year, newsroom computers were found to be communicating with Web servers that were traced back to China, according to people with knowledge of the Post investigation who declined to speak on the record.

Jennifer Lee, a spokeswoman for the Post Company, said that the “company did not have anything to share at this time.”

Security experts said that in 2008, Chinese hackers began targeting American news organizations as part of an effort to monitor coverage of Chinese issues.

In a report for clients in December, Mandiant, a computer security company, said that over the course of several investigations it found evidence that Chinese hackers had stolen e-mails, contacts and files from more than 30 journalists and executives at Western news organizations, and had maintained a “short list” of journalists for repeated attacks.

Among those targeted were journalists who had written about Chinese leaders, political and legal issues in China and the telecom giants Huawei and ZTE.

The Times reported on Wednesday that Bloomberg L.P. was also attacked by Chinese hackers after its Bloomberg News unit published an article last June about the wealth accumulated by relatives of Xi Jinping, China’s vice president at the time. Mr. Xi became general secretary of the Communist Party in November and is expected to become president in March.

The secretary of state, Hillary Rodham Clinton, said on Thursday that a global effort was needed to establish rules for cyberactivity. In her final meeting with reporters, Mrs. Clinton addressed a question about China’s efforts to infiltrate computer systems at The New York Times. “We have seen over the last years an increase in not only the hacking attempts on government institutions but also nongovernmental ones,” she said, adding that the Chinese “are not the only people who are hacking us.”

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DealBook: Doubt Is Cast on Firms Hired to Help Banks

Federal authorities are scrutinizing private consultants hired to clean up financial misdeeds like money laundering and foreclosure abuses, taking aim at an industry that is paid billions of dollars by the same banks it is expected to police.

The consultants operate with scant supervision and produce mixed results, according to government documents and interviews with prosecutors and regulators. In one case, the consulting firms enabled the wrongdoing. The deficiencies, officials say, can leave consumers vulnerable and allow tainted money to flow through the financial system.

“How can you be independent if you’re hired by the entity you’re reviewing?” Senator Jack Reed, Democrat of Rhode Island, who sits on the Senate Banking Committee, said.

The pitfalls were exposed last month when federal regulators halted a broad effort to help millions of homeowners in foreclosure. The regulators reached an $8.5 billion settlement with banks, scuttling a flawed foreclosure review run by eight consulting firms. In the end, borrowers hurt by shoddy practices are likely to receive less money than they deserve, regulators said.

On Thursday, Senator Elizabeth Warren, Democrat of Massachusetts, and Representative Elijah Cummings, Democrat of Maryland, announced that they would open an investigation into the foreclosure review, seeking “additional information about the scope of the harms found.”

Critics concede that regulators have little choice but to hire outsiders for certain responsibilities. after they find problems at the banks. The government does not have the resources to ensure that banks follow the rules. Still, consultants like Deloitte & Touche and the Promontory Financial Group can add to regulators’ headaches, the government documents and interviews indicate. Some banks that work with consultants continue to run afoul of the law. At other times, consultants underestimate the extent of the misdeeds or facilitate them, preventing regulators from holding institutions accountable.

Now, regulators and lawmakers are rethinking their relationship with the consultants. Officials at the Federal Reserve, which oversees many large banks, are questioning the prudence of relying on consultants so heavily, said two people with direct knowledge of the matter.

When the Office of the Comptroller of the Currency penalized JPMorgan Chase last month for breakdowns in money-laundering controls, it imposed stricter requirements, ordering the bank to hire a consultant with “specialized experience” in money laundering and to ensure that the firm “not be subject to any conflict of interest.” In a separate action against the bank related to a $6 billion trading loss last year, the agency opted not to mandate an outside consultant at all.

While the comptroller’s office will continue requiring consultants in certain cases, some agency officials are worried about the quality of the work, as well as the consultants’ independence, according to three government officials briefed on the matter.

Since the financial crisis, regulators have increasingly relied on consultants. The comptroller’s office ordered banks to hire consultants in more than 130 enforcement actions since 2008, or nearly 15 percent of the cases.

It can be a lucrative business. In 2011, regulators mandated that 14 banks employ consultants to determine whether homeowners were wrongfully evicted. Over 14 months, the consultants collected about $2 billion in fees, according to regulators and bank officials.

Those fees amounted to more than half of what homeowners will receive under the $8.5 billion settlement that ended the review. As part of the deal, officials will disburse $3.3 billion to 3.8 million borrowers in foreclosure.

According to consultants and regulators, the broad review was plagued with inefficiencies. For example, Promontory initially instructed employees to calculate lawyers’ fees for each loan, to assess if borrowers were overcharged. Later, it scrapped the original procedure, only to reverse the policy again two weeks later, according to two reviewers who worked for Promontory.

“From Day 1, Promontory strove to conduct its review work as thoroughly and independently as possible,” a spokesman for the firm, Christopher Winans, said in a statement. “Our overarching concern at all times was to serve the best interests of borrowers.”

Some lawmakers question whether a consultant’s regulatory connections helped it secure contracts. PricewaterhouseCoopers, which has a stable of former Securities and Exchange Commission officials, won much of the foreclosure review work, signing deals with four banks, including Citigroup. Promontory, the firm examining loans for Wells Fargo, Bank of America and PNC, was founded in 2000 by the former head of the comptroller’s office, Eugene A. Ludwig.

When the contracts were initially awarded, some housing advocates complained that consulting firms could not objectively evaluate banks with which they had pre-existing business relationships. The comptroller’s office said it vetted the firms to spot such potential conflicts, and argued that the process provided swifter relief for homeowners than if the government had hired the companies directly through a lengthy contracting process.

But concerns persisted. Deloitte, which won the contract to review JPMorgan’s loans, had previously audited Washington Mutual and Bear Stearns, two firms JPMorgan acquired during the financial crisis. In May, the comptroller’s office replaced Allonhill, the consultant for Aurora Bank, after the firm disclosed that it had already reviewed some “of the same pool of loans” as part of an earlier contract.

“It’s clear from the foreclosure settlement that oversight over consultants was inadequate and the review process was deeply flawed,” said Representative Carolyn B. Maloney, Democrat of New York, who recently pressed regulators to detail how consultants were paid. People close to the review say consultants relied on a process that the comptroller’s office designed in 2011, under previous leadership.

“This was a very complex process,” a spokesman for the comptroller said. “Throughout the process, regulators provided continuous oversight, guidance and were available to discuss issues.” The agency also performs spot checks on the consultants.

Still, the foreclosure review highlighted broader concerns about the role consultants play.

Since the financial crisis, the comptroller’s office has issued nearly 20 enforcement actions against banks that had already hired consultants to help iron out problems, according to government documents. While consultants cannot be expected to remedy every last issue at the banks, the actions raise questions about the effectiveness of their work.

When HSBC, the British bank, was sanctioned in 2003 over porous money-laundering controls, the bank turned to Deloitte to review its compliance, an official briefed on the matter said. Deloitte also worked for HSBC from 2006 to 2008, the person said, building a system to monitor money flows more effectively. But the bank ran into trouble in 2010 over similar issues, as highlighted in a recent scathing report by the Senate’s Permanent Subcommittee on Investigations.

As part of a regulatory order, HSBC again hired Deloitte, this time to assess the number of times the bank failed to report suspicious transactions. Deloitte, three officials said, generously bundled hundreds of missed transfers into a single report. That helped save the bank from some government fines.

Despite the undercounting, HSBC still paid a record $1.9 billion last year to settle accusations that it enabled drug cartels to move money through its American subsidiaries.

In a statement, a spokesman for the firm said, “Deloitte fully stands behind the quality and integrity of its work on behalf of regulatory authorities.”

Deloitte has also been suspected of helping institutions cloak illicit transfers of money to rogue nations around the globe. In August, New York’s top banking regulator, Benjamin M. Lawsky, accused Deloitte of helping the British bank Standard Chartered flout American sanctions.

The consulting firm was hired to flag suspicious transfers routed through Standard Chartered’s New York branches. Instead, it instructed bankers on how to escape regulatory scrutiny, according to state court documents.

Deloitte turned over “highly confidential information” from which the bank gleaned insight into “regulators’ concerns and strategies,” the court documents said. The firm later doctored its report to regulators, Mr. Lawsky said, deliberately removing some illegal transfers on behalf of Iranian clients. In an e-mail, a Deloitte partner admitted that a report on the transactions was a “watered-down version.”

The authorities never took legal action against Deloitte, and federal officials noted in a separate settlement agreement that Standard Chartered employees withheld critical information from the consulting firm.

Despite these concerns, regulators are turning to a familiar source to help Standard Chartered. As part of a $327 million settlement last year, the bank is required to hire “an independent consultant.”

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