4th round of talks start over Iran nuclear program

ALMATY, Kazakhstan (AP) — World powers began their fourth round of high-level talks with Iranian officials on Tuesday as negotiators from both sides pledged to offer new ways to break a years-long impasse over Tehran's nuclear program and its feared ability to make atomic weapons in the future.

Few believe the latest attempt to reach compromise will yield any major breakthroughs, and negotiators refused to detail what the new solutions might be. Instead, officials described the latest diplomatic discussions as a way to build confidence with Iran as it steadfastly maintains its right to enrich uranium in the face of harsh international sanctions.

"The offer addresses the international concern on the exclusively peaceful nature of the Iranian nuclear program, but it is also responsive to Iranian ideas," said Michael Mann, spokesman for EU foreign policy chief Catherine Ashton, who is leading the negotiations. "We've put some proposals forward which will hopefully allow Iran to show some flexibility."

Mahmoud Mohammedi, a member of the Iranian delegation, said Tehran also is prepared to make an offer of it's own to end the impasse but refused to provide any details.

The Obama administration is pushing for diplomacy to solve the impasse but has not ruled out the possibility of military intervention in Iran to prevent it from acquiring a nuclear weapon. And Israel has threatened it will use all means to stop Iran from being able to build a bomb, potentially as soon as this summer, raising the specter of a possible Mideast war.

A senior U.S. official at the talks said on Monday that some sanctions relief would be part of the offer to Iran but also refused to detail it. The new relief is part of a package that the U.S. official said included "substantive changes — whether you'd call them super-substantial, I'll leave to history." The official acknowledged reports earlier this month that sanctions would be eased to allow Iran's gold trade to progress, but would neither confirm nor deny they are included in the new relief offer, and spoke only on condition of anonymity to discuss the sensitive diplomatic talks more candidly.

In a statement before the talks began Tuesday afternoon, Interfax news agency cited Russia's envoy as saying easing of sanctions is possible only if Iran can assure the world that its nuclear program is for exclusively peaceful purposes.

"There is no certainty that the Iranian nuclear program lacks a military dimension, although there is also no evidence that there is a military dimension," Russian Deputy Foreign Minister Sergei Ryabkov said.

Officials from both sides have set low expectations for a breakthrough in Almaty — the first time the high-level negotiators have met since last June's meeting in Moscow that threatened to derail the delicate efforts.

The talks are being held in private at a hotel in Almaty, Kazakhstan's largest city, and were deemed so sensitive that reporters were not allowed on the premises Tuesday save for a small handful of TV cameras and photographers allowed to watch Ashton, who is leading the negotiations, greet Saeed Jalili, secretary of Iran's Supreme National Security Council.

Tehran maintains it is enriching uranium only to make reactor fuel and medical isotopes, and insists it has a right to do so under international law. It has signaled it does not intend to stop, and U.N. nuclear inspectors last week confirmed Iran has begun a major upgrade of its program at the country's main uranium enrichment site.

Negotiators hope that easing some of the sanctions will make Tehran more agreeable to halting production of 20 percent enriched uranium — the highest grade of enrichment that Iran has acknowledged and one that experts say could be turned into warhead grade in a matter of months. The six world powers — United States, Russia, China, Britain, France and Germany — also want Iran to suspend enrichment in its underground Fordo nuclear facility, and to ship its stockpile of high-grade uranium out of the country.

Over the last eight months, the international community has imposed harsh economic sanctions on Iran that U.S. officials said have, among other things, cut the nation's daily oil output by 1 million barrels and slashed its employment rate. Western powers have hoped that the Iranian public would suffer under sanctions so badly that the government would feel a moral obligation to slow its nuclear program.

But an analysis released Monday by the International Crisis Group concluded that the web of international sanctions have become so entrenched in Iran's political and economic systems that they cannot be easily lifted piece-by-piece. It found that Tehran's clerical regime has begun adapting its policy to the sanctions, despite their crippling effect on the Iranian public. Doing so, the analysis concluded, has divided the public's anger "between a regime viewed as incompetent and an outside world seen as uncaring."

Iran has been unimpressed with earlier offers by the powers to provide it with medical isotopes and lift sanctions on spare parts for civilian airliners, and new bargaining chips that Tehran sees as minor are likely to be snubbed as well. Iran insists, as a starting point, that world powers must recognize the republic's right to enrich uranium.

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Follow Peter Leonard on Twitter at https://twitter.com/pete_leonard and Lara Jakes on Twitter at http://twitter.com/larajakesAP

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ECB likely stepped up bond-buying program: Reuters poll (Reuters)

BANGALORE (Reuters) – The European Central Bank probably stepped up its bond-buying program, spending around 5.3 billion euros ($7.3 billion) on peripheral euro zone debt last week to help calm markets and lower bond yields, a Reuters poll showed on Monday.

Conducted on a day where Italian borrowing costs hit a record euro-era high, the poll of 18 money market traders showed the ECB was thought to have increased its purchases from 4 billion euros the previous week.

That would take the cumulative amount spent on its Securities Market Programme to 173.5 billion.

Under its new president Mario Draghi, the ECB unexpectedly cut benchmark interest rates last week by 25 basis points, helping push key interbank rates lower.

Key three-month Euribor rates, traditionally the main gauge of unsecured interbank euro lending and a mix of interest rate expectations and banks' appetite for lending, sank to a five-month low on Monday at 1.476 percent from a fixing of 1.488 percent on Friday.

But with the Greek debt crisis raging on and Italian yields pushing yield limits that prompted other peripheral euro zone nations to seek bailouts, money markets are still a long way away from normalizing.

"The situation as it is now is the worst possible in the short end," said a euro money market trader.

"Almost everything is going back to the deposit facility and only small amounts going around on interbank cash. It can't worsen from this situation because the next step is the market being blocked completely."

Data from the ECB shows banks deposited 288 billion euros with the central bank on Friday, the highest this year.

A wider regular weekly poll of 25 traders showed the ECB will allot 195 billion euros at its regular seven-day tender compared to 182.7 billion last week.

Traders also said the bank would allot 55 billion euros in one-month funds compared to 60 billion in the last sale. Forecasts ranged from 25 to 70 billion.

(1 euro = $1.375)

(Reporting by Sumanta Dey; Editing by John Stonestreet)

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ITV admits using video-game footage in IRA program (AP)

DUBLIN – Masked guerrillas open fire from two trucks painted in army drab and camouflage. An approaching helicopter billows black smoke and careens out of control, somehow discharging parachuting crew members barely a hundred feet from the ground before it crashes in flames.

The footage was of a 1988 Irish Republican Army attack, according to a documentary crew from Britain's ITV network. Gamers, however, countered that it is a clip from a video game, saying they recognized the scene.

ITV admitted Tuesday that its much-vaunted new investigative series, "Exposure," picked up a mischievously labeled clip from the Internet and never figured out it came from a military shoot-'em-up game, Arma II.

"This was an unfortunate case of human error for which we apologize," said ITV spokesman James MacLeod a day after 1.3 million saw Monday's broadcast of the documentary.

The program sought to document how deposed Libyan dictator Moammar Gadhafi supplied the outlawed IRA with weaponry in the mid-1980s, a topic that has been extensively documented. It also asserted — without backing up the claim with evidence — that Gadhafi continued to fund IRA dissidents until recent months.

MacLeod maintained that ITV did have real footage of the 1988 attack in question — something that, if true, has never been seen publicly before — and would edit it into the online version. But the program remained off of the network's video-streaming list Tuesday night.

Veteran observers of the Northern Ireland conflict, as well as the gaming community, were flabbergasted that even an amateur reporter could mistake the video-game clip for any IRA attack.

The footage shows several men operating from military-grade vehicles, a capability that the underground IRA never had, while the explosion and parachuting figures bear no resemblance to the June 23, 1988 attack.

The IRA did shoot at a helicopter that day on Northern Ireland's border, but the helicopter landed safely and no crew members were wounded — much less parachuted from an altitude certain to kill them.

The documentary superimposed a label, "IRA film 1988," while a voiceover claimed: "With Gadhafi's heavy machine guns it was possible to shoot down a helicopter as the terrorists' own footage of 1988 shows. This was what the security forces feared most."

Gamers celebrated ITV's stumble as proof that video games were more realistic than ever.

"ITV documentary can't tell the difference between gaming and reality," said a headline on the PC Gamer website. Readers speculated that ITV's next documentary would explore how Gadhafi was secretly funding video-game companies to promote stupidity in the media.

"I am not sure how they could make such an obvious mistake," said Marek Spanel, chief executive of Bohemia Interactive Studio, the Czech Republic-based maker of Arma II.

The game depicts United States Marines fighting insurgents in a fictional former Soviet republic called Chernarus.

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ITV admits using video-game footage in IRA program (AP)

DUBLIN – Masked guerrillas open fire from two trucks painted in army drab and camouflage. An approaching helicopter billows black smoke and careens out of control, somehow discharging parachuting crew members barely a hundred feet from the ground before it crashes in flames.

The footage was of a 1988 Irish Republican Army attack, according to a documentary crew from Britain's ITV network. Gamers, however, countered that it is a clip from a video game, saying they recognized the scene.

ITV admitted Tuesday that its much-vaunted new investigative series, "Exposure," picked up a mischievously labeled clip from the Internet and never figured out it came from a military shoot-'em-up game, Arma II.

"This was an unfortunate case of human error for which we apologize," said ITV spokesman James MacLeod a day after 1.3 million saw Monday's broadcast of the documentary.

The program sought to document how deposed Libyan dictator Moammar Gadhafi supplied the outlawed IRA with weaponry in the mid-1980s, a topic that has been extensively documented. It also asserted — without backing up the claim with evidence — that Gadhafi continued to fund IRA dissidents until recent months.

MacLeod maintained that ITV did have real footage of the 1988 attack in question — something that, if true, has never been seen publicly before — and would edit it into the online version. But the program remained off of the network's video-streaming list Tuesday night.

Veteran observers of the Northern Ireland conflict, as well as the gaming community, were flabbergasted that even an amateur reporter could mistake the video-game clip for any IRA attack.

The footage shows several men operating from military-grade vehicles, a capability that the underground IRA never had, while the explosion and parachuting figures bear no resemblance to the June 23, 1988 attack.

The IRA did shoot at a helicopter that day on Northern Ireland's border, but the helicopter landed safely and no crew members were wounded — much less parachuted from an altitude certain to kill them.

The documentary superimposed a label, "IRA film 1988," while a voiceover claimed: "With Gadhafi's heavy machine guns it was possible to shoot down a helicopter as the terrorists' own footage of 1988 shows. This was what the security forces feared most."

Gamers celebrated ITV's stumble as proof that video games were more realistic than ever.

"ITV documentary can't tell the difference between gaming and reality," said a headline on the PC Gamer website. Readers speculated that ITV's next documentary would explore how Gadhafi was secretly funding video-game companies to promote stupidity in the media.

"I am not sure how they could make such an obvious mistake," said Marek Spanel, chief executive of Bohemia Interactive Studio, the Czech Republic-based maker of Arma II.

The game depicts United States Marines fighting insurgents in a fictional former Soviet republic called Chernarus.

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Gov't mulls expanding mortgage refinance program (AP)

WASHINGTON – The federal government is looking at how it could help a greater number of homeowners who owe more than their house is worth refinance at today's historically low rates.

The Federal Housing Finance Agency said Friday that it has been reviewing a program launched two years ago to see if it could be expanded so more homeowners could qualify. The announcement was made in a statement released a day after President Barack Obama mentioned the idea in a speech to Congress.

The Home Affordable Refinance Program, or HARP, allows people whose homes are underwater by as much as 20 percent to refinance their mortgages at lower interest rates. Banks typically require that homeowners have some equity before approving a refinance loan.

The program gives homeowners a chance to reduce their mortgage payments by hundreds of dollars per month. But many people are not eligible for the program because their home values have fallen much further.

Edward J. DeMarco, the housing agency's acting director, said officials are "carefully reviewing the mechanics" of the program to "identify possible enhancements that would reduce barriers for borrowers already otherwise eligible to refinance using HARP."

The program only covers mortgages created before June 2009 and owned or backed by government-controlled mortgage buyers Fannie Mae and Freddie Mac. Borrowers also must be current on their payments.

This week, the average rate on a 30-year fixed mortgage fell to 4.12 percent. That's the lowest level in six decades.

As of July, more than 838,000 homeowners had refinanced through the program. Officials had hoped at least 4 million Americans would take advantage.

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Gov't mulls expanding mortgage refinance program (AP)

WASHINGTON – The federal government is looking at how it could help a greater number of homeowners who owe more than their house is worth refinance at today's historically low rates.

The Federal Housing Finance Agency said Friday that it has been reviewing a program launched two years ago to see if it could be expanded so more homeowners could qualify. The announcement was made in a statement released a day after President Barack Obama mentioned the idea in a speech to Congress.

The Home Affordable Refinance Program, or HARP, allows people whose homes are underwater by as much as 20 percent to refinance their mortgages at lower interest rates. Banks typically require that homeowners have some equity before approving a refinance loan.

The program gives homeowners a chance to reduce their mortgage payments by hundreds of dollars per month. But many people are not eligible for the program because their home values have fallen much further.

Edward J. DeMarco, the housing agency's acting director, said officials are "carefully reviewing the mechanics" of the program to "identify possible enhancements that would reduce barriers for borrowers already otherwise eligible to refinance using HARP."

The program only covers mortgages created before June 2009 and owned or backed by government-controlled mortgage buyers Fannie Mae and Freddie Mac. Borrowers also must be current on their payments.

This week, the average rate on a 30-year fixed mortgage fell to 4.12 percent. That's the lowest level in six decades.

As of July, more than 838,000 homeowners had refinanced through the program. Officials had hoped at least 4 million Americans would take advantage.

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JPMorgan, BofA take heat for foreclosure program (AP)

WASHINGTON – Two of the nation's largest mortgage lenders are not doing enough to help Americans avoid foreclosure, the Obama administration said Thursday.

The Treasury Department said that Bank of America and JPMorgan Chase & Co. have done a poor job helping people permanently lower their mortgage payments as part of the government's signature foreclosure-prevention program. The lenders have rejected people who were eligible for mortgage modifications, Treasury said.

The government first criticized the two lenders, along with Wells Fargo & Co. and Ocwen Loan Servicing, in June, and began withholding financial incentives of up to $1,000 per permanent loan modification.

JPMorgan Chase said in a statement that it is continuing to "make significant improvements to our process and controls," and that future scorecards will reflect that.

Bank of America said through a spokesman that it is "working to improve the ratings that would allow reinstatement of incentives, but we are not driven by that goal."

Wells Fargo and Ocwen were removed from the list of companies needing "substantial improvement" in the second quarter and will resume receiving the incentives. Wells Fargo said it was "pleased" with the report and that it was committed to helping more at-risk homeowners.

The mortgage-aid program was launched in 2009 and was intended to help those at risk of foreclosure by lowering their monthly payments. Borrowers start with lower payments on a trial basis. But the program has struggled to convert them into permanent loan modifications.

Nearly 1.7 million troubled homeowners received trial modifications over the past two years. But as of July, more than half of them, or roughly 890,000 homeowners, have dropped out of the program entirely.

Homeowners have complained that the program is a bureaucratic mess. Many say they were disqualified after banks lost their documents and failed to return their phone calls. Banks have blamed homeowners for failing to submit needed paperwork. Some lenders have disputed the government's data, saying the findings are based on old reports.

Those who are accepted into the program receive interest rates as low as 2 percent for five years. They can repay their loans over a longer period. The median savings for those who remain in the program is about $525 per month.

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Summary Box: Firms failing in foreclosure program (AP)

NOT DOING ENOUGH: Bank of America and JPMorgan Chase & Co. haven't done enough to help people permanently lower their mortgage payments and avoid foreclosure, the Treasury Department said Thursday.

CRITICISM LEVIED: The government first criticized those two lenders, along with Wells Fargo & Co., and Ocwen Loan Servicing, in June and began withholding financial incentives of up to $1,000 per permanent loan modification.

TRYING TO IMPROVE: JPMorgan Chase and Bank of America said they are working to improve their work on the program. Wells Fargo and Ocwen were removed from the list of companies needing "substantial improvement."

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AIG repays $2.15 billion to bailout program (AP)

WASHINGTON – American International Group Inc. has paid the federal government $2.15 billion this week after selling off a life insurance subsidiary, trimming its financial bailout balance to roughly $51 billion.

The Treasury Department said Thursday that the repayment comes from AIG's sale of its Nan Shan Life Insurance Co. in Taiwan. AIG has now paid back $11.4 billion of the $68 billion in bailout funds it received from the government at the height of the 2008 financial crisis.

The government sold 200 million AIG shares in May. That cut the government's stake in the company from 92 percent to 77 percent. Treasury officials have said they expect to recoup the full amount of the bailout.

Robert Benmosche, the president and CEO of New York-based AIG, said the sale of Nan Shan was "a great result for American taxpayers, for AIG and for Nan Shan's policyholders, employees and agents."

"We continue to make progress in helping the Treasury and taxpayers recoup their investment in AIG," Benmosche said in a statement.

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Home Affordable Modification Program on GOP's Bad List (ContributorNetwork)

COMMENTARY | President Barack Obama instituted the Home Affordable Modification Program (HAMP) to counteract the subprime mortgage crisis. The GOP is quick to point out that the program failed to reach its stated goal of averting the foreclosures of "3 to 4 million American homeowners." Asserting that HAMP only benefited 753,000 homeowners as of July 2010, the administration counters that approximately 1.5 million homeowners have begun the trial modification aspect of the program.

It bears pointing out that there is a world of difference between seeing through the foreclosure prevention process from start to finish and merely starting a trial modification. The Associated Press reveals that even HAMP-friendly Democrats -- most notably California Rep. Maxine Waters -- count only 600,000 successfully completed modifications. Seeing the opportunity to do away with an under-performing program they claim wastes taxpayer funds, House Republicans voted 252 to 170 to terminate HAMP.

"If we can't eliminate this failed program, what program can we eliminate," asks N.C. Rep. Patrick McHenry. It is clear that the GOP is working hard to reign in a government that it believes to be on a spending spree. The only problem with canceling HAMP is the lack of another program. Mass. Rep. Barney Frank counters the GOP's stroke of the red pen with the opinion that "the absence of any program leaves people worse off."

Venting in a New York Times editorial, Neil Barofsky -- TARP's former Special Inspector General -- points to the endemic unwillingness of lenders to support the program. The number of permanent modifications that Barofsky reveals -- 540,000 -- is a far cry from the 1.5 million the administration likes to point to. In fact, the expert asserts that there is the dark cipher of more than 800,000 modifications that failed.

Interestingly enough, it is neither the fault of the administration nor the GOP that HAMP is a flop. Rather, the responsibility squarely falls on the shoulders of the Treasury Department that bailed out the banks but failed to attach any strings to the loans. Much like the verbal agreement between two parties, which isn't worth the paper it isn't printed on, that stipulate how funds ought to be used in the future, banks conceded that once back in business, they could get back to lending money. The opposite is the case. Banks are now tight-fisted and drag their feet on home loan modifications as well as short sales.

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Home Affordable Modification Program on GOP's Bad List (ContributorNetwork)

COMMENTARY | President Barack Obama instituted the Home Affordable Modification Program (HAMP) to counteract the subprime mortgage crisis. The GOP is quick to point out that the program failed to reach its stated goal of averting the foreclosures of "3 to 4 million American homeowners." Asserting that HAMP only benefited 753,000 homeowners as of July 2010, the administration counters that approximately 1.5 million homeowners have begun the trial modification aspect of the program.

It bears pointing out that there is a world of difference between seeing through the foreclosure prevention process from start to finish and merely starting a trial modification. The Associated Press reveals that even HAMP-friendly Democrats -- most notably California Rep. Maxine Waters -- count only 600,000 successfully completed modifications. Seeing the opportunity to do away with an under-performing program they claim wastes taxpayer funds, House Republicans voted 252 to 170 to terminate HAMP.

"If we can't eliminate this failed program, what program can we eliminate," asks N.C. Rep. Patrick McHenry. It is clear that the GOP is working hard to reign in a government that it believes to be on a spending spree. The only problem with canceling HAMP is the lack of another program. Mass. Rep. Barney Frank counters the GOP's stroke of the red pen with the opinion that "the absence of any program leaves people worse off."

Venting in a New York Times editorial, Neil Barofsky -- TARP's former Special Inspector General -- points to the endemic unwillingness of lenders to support the program. The number of permanent modifications that Barofsky reveals -- 540,000 -- is a far cry from the 1.5 million the administration likes to point to. In fact, the expert asserts that there is the dark cipher of more than 800,000 modifications that failed.

Interestingly enough, it is neither the fault of the administration nor the GOP that HAMP is a flop. Rather, the responsibility squarely falls on the shoulders of the Treasury Department that bailed out the banks but failed to attach any strings to the loans. Much like the verbal agreement between two parties, which isn't worth the paper it isn't printed on, that stipulate how funds ought to be used in the future, banks conceded that once back in business, they could get back to lending money. The opposite is the case. Banks are now tight-fisted and drag their feet on home loan modifications as well as short sales.

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SAfrica's MTN launches mobile insurance program (AP)

JOHANNESBURG – A South African mobile phone giant has joined with an insurance company to launch a program in Ghana that will allow subscribers to pay for life insurance through their mobile phones, a company official said Wednesday.

Phone banking has taken off in Africa, where the impoverished majority can't afford the costs of traditional banks, including account fees and bus fares to get to town from villages to visit the banks.

More Ghanaians have mobile money accounts than bank accounts, said Jeremy Leach, a divisional director of Hollard Insurance Group. South Africa-based mobile phone giant The MTN Group is partnering with the group to increase Ghanaians' access to life insurance, he said.

Mobile banking users send and receive money through their cell phones.

Leach said Hollard approached MTN to establish a plan where Ghanaians can pay premiums as low as one cedi ($0.65) per month on their mobile phones through MTN's mobile banking system.

"Ghana has a fast-growing market and is one of the fastest growing countries in Africa," Leach said. "One of the things that was pleasing when we got there was that we thought we'd have to do a lot of consumer education, but what we found was that the national health insurance had been rolled out so there was increased awareness."

Ghana has 9 million MTN mobile subscribers, 2 million of whom have joined the mobile banking program launched in July 2009. Mobile banking customers can buy the insurance using menus on their cell phones. They need a valid mobile money account to sign the application form, but medical or other documents are not required.

The program is only in the pilot stages limited to a number of service centers, Leach said, adding that the full rollout will occur within months.

Pieter Verkade, MTN's mobile money executive, said Wednesday: "What we believe is it's a whole new area for us, as well as insurance companies. We are bringing these kinds of products to a market where they before would not have access to these projects."

Verkade said MTN is looking to expand its mobile banking services in regions such as West Africa, where there is a lot of demand. Already, MTN offers Rwandans the ability to purchase prepaid electricity through their cell phones.

"It's certainly doing a bit to improve the whole economy's income and the way people can interact by providing them financial tools they didn't have before," Verkade said. "In that respect, it's some kind of a revolution."

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