August 10, 2005

What’s Happening to the Real People Involved in the Kelo Eminent Domain Case

Filed under: Taxes & Government — Tom @ 9:19 pm

Welcome Volokh Conspirators!

A blogswarm of energy and some instances of state legislative response have taken place in the wake of The Supreme Court’s ruling in the Kelo v. New London, Connecticut case, which in essence ruled that the government can take your property if some other person or entity convinces them that they can put your land to “better” (purposefully vague) use. In other words, the government’s power of eminent domain, which used to be limited to public purposes, such as building roads, bridges, etc., has now been broadened to the point of there being no meaningful limit.

Jeff Michael, whose blog’s normal focus is on consumer debt, credit, and personal finance, notes that what has been lost in all of the uproar are the horrors being visited on the losers.

I agree. I haven’t seen this covered anywhere else except the weekly community paper I’ve linked to, though that article goes back almost a month, and am shocked both at what is happening and at the lack of attention (and note, the whole contentious case isn’t necessarily over):

The U.S. Supreme Court recently found that the city’s original seizure of private property was constitutional under the principal of eminent domain, and now New London is claiming that the affected homeowners were living on city land for the duration of the lawsuit and owe back rent. It’s a new definition of chutzpah: Confiscate land and charge back rent for the years the owners fought confiscation.

In some cases, their debt could amount to hundreds of thousands of dollars. Moreover, the homeowners are being offered buyouts based on the market rate as it was in 2000.

….. (Matt) Dery owns four buildings on the project site, including his home and the birthplace and lifelong home of his 87-year-old mother, Wilhelmina. Dery plans to make every remaining effort to keep his land, but with few legal options remaining, he’s planning for the worst.

And for good reason. It’s reasonable to think that people who purchased property years ago (in some cases, decades ago) would be in a position to cash in, especially since they’re being forced from their homes. But that’s not the case.

The New London Development Corp., the semi-public organization hired by the city to facilitate the deal, is offering residents the market rate as it was in 2000, as state law requires. That rate pales in comparison to what the units are now worth, owing largely to the relentless housing bubble that has yet to burst.

“I can’t replace what I have in this market for three times [the 2000 assessment],” says Dery, 48, who works as a home delivery sales manager for the New London Day .

…. And there are more storms on the horizon. In June 2004, NLDC (New London Development Corporation) sent the seven affected residents a letter indicating that after the completion of the case, the city would expect to receive retroactive “use and occupancy” payments (also known as “rent”) from the residents.

In the letter, lawyers argued that because the takeover took place in 2000, the residents had been living on city property for nearly five years, and would therefore owe rent for the duration of their stay at the close of the trial. Any money made from tenants — some residents’ only form of income — would also have to be paid to the city.

With language seemingly lifted straight from The Goonies , NLDC’s lawyers wrote, “We know your clients did not expect to live in city-owned property for free, or rent out that property and pocket the profits, if they ultimately lost the case.” They warned that “this problem will only get worse with the passage of time,” and that the city was prepared to sue for the money if need be.

“It seems like it is simply a desperate attempt by a nearly broke organization to try to come up with more funds to perpetuate its own existence,” Bullock wrote. He vowed to respond to any lawsuit with another.

…. An NLDC estimate assessed Dery for $6,100 per month since the takeover, a debt of more than $300K. One of his neighbors, case namesake Susette Kelo, who owns a single-family house with her husband, learned she would owe in the ballpark of 57 grand. “I’d leave here broke,” says Kelo. “I wouldn’t have a home or any money to get one. I could probably get a large-size refrigerator box and live under the bridge.”

Tyranny, thy name is Kelo.

Alabama has done the right thing (SEE UPDATE 4–maybe not), as it “became the first state to enact new protections against local-government seizure of property allowed under a Supreme Court ruling…”

The other forty-nine states need to follow Alabama’s lead, and quickly.

UPDATE: I’ve been attempting to find any new information on what is actually happening to the Kelo Seven victims, and haven’t found anything, even at the web site of the Institute for Justice, which represented the property owners. If anyone has news (hopefully with links), E-mail me.

UPDATE 2: August 12 Outside the Beltway Jammer.

UPDATE 3, August 14: This Von Mises Blog post says in the second paragraph that “The IFJ (Institute for Justice) also points out that Connecticut legislators have called for a moratorium on the use of eminent domain until their legislatures can revise property laws. Even the City of New London has agreed to allow Susette Kelo to stay in her property for now.” But there is no indication as to whether the meter is still running on the back rent.

UPDATE 4, August 15: A commenter at Volokh suggests that there’s less to Alabama’s law than meets the eye since eminent domain on “blighted neighborhoods” is still allowed. If so, I would agree with the commenter that this is a major disappointment.

UPDATE 5: Reason’s Hit and Run Blog picks up the story (warning: author throws an F-bomb in the first sentence).

UPDATE 6: Junkyard Blog says “You’ve got to be kidding me.”

What May Be the Mother of All Data Thefts Proves Why Data Encryption and Credit Freezes are Needed, NOW

Filed under: Corporate Outrage,Privacy/ID Theft,Taxes & Government — Tom @ 9:44 am

I have seen this written up in a couple of computer publications in the past two days, but nowhere else. I’m surprised, because the scope of the data heist is stunning, brazen, and though obviously large, is not yet fully known.

Read carefully, and grasp the impact (bolds are mine, though I could bold the whole excerpt):

Spyware researchers picking apart one of the more notorious spyware programs have stumbled upon what appears to be a massive identity theft ring hijacking confidential data from millions of infected computers.

Sunbelt Software Inc., makers of the enterprise-grade CounterSpy spyware protection product, made the discovery during an audit of “CoolWebSearch,” a program that routinely hijacks Web searchers, browser home pages and other Internet Explorer settings.

During the research, Sunbelt researcher Patrick Jordan deliberately installed the “CoolWebSearch application on a machine and immediately noticed that the infected system became a spam zombie that was placing callbacks to a remote server.

When Jordan visited the remote server, he was shocked to find that it was being used to distribute sensitive personal information from millions of PC users infected by the spyware application.

“We found the keylogger transcript files that are being uploaded to the servers. We’re talking real spyware stuff…chat sessions, usernames, passwords, bank account information, full names, addresses,” said Sunbelt president Alex Eckelberry.

In an interview with Ziff Davis Internet News, Eckelberry said the sophistication of the operation suggests it’s the work of a “massive identity theft ring” that used keystroke loggers to grab confidential information that could be used to create fake online identities.

“I’m not being dramatic. This is the most repulsive thing I’ve ever seen. It’s very painful to see what’s in these log files that are being uploaded in real time. We’re seeing a lot of bank information and usernames and passwords to get in,” Eckelberry said.

He said the log files included logins to one business bank account with more than $350,000 and another small company in California with over $11,000, readily accessible.

“There are lots of eBay account information and names and addresses of the people owning those accounts. Names, passwords, all matched up,” Eckelberry added.

He said the server, which is hosted out of a data center in Texas, was effectively a “massive repository of stolen data” that was being replenished in real time.

“As the [log] file gets to a certain size, it gets taken down and a new file starts generating. This goes on nonstop. We’ve been watching it for a few days while trying to get to the FBI, and it just keeps growing and growing.”

While the site is being hosted in the United States, Eckelberry said the domain name is registered to an offshore company.

Eckelberry said the huge size of the log files is a clear indication that thousands of machines are pinging back daily.

In some cases, where users appeared to be at immediate risk of losing a considerable amount of money, Sunbelt has contacted the affected individuals.

From another source concerning the same incident:

A spyware ring has infiltrated the IT systems of as many as 50 international banks and logged social security Security numbers, credit card and bank account numbers, passwords, eBay (Nasdaq: EBAY) and PayPal (Nasdaq: PYPL) account information and chat transcripts, according to the security firm Sunbelt Software Latest News about Sunbelt Software.

The anti-spyware manufacturer’s president wrote in the company blog that it discovered the identity theft operation while doing research on a CoolWebSearch exploit. The spyware downloads with CoolWebSearch, but is a separate program.

…. “Bad things happen. Always have. Always will,” Steve Hunt, president of 4A International, a security consulting company, told TechNewsWorld. “So don’t expect you can ever be completely free of risks like spyware — but also don’t avoid reasonable precautions.”

These operations are only going to get more sophisticated, analysts said. “These sorts of attacks on our personal and corporate secrets will only get more advanced and discrete,” Hunt warned.

Mark Durham, communications director, Identity Theft 911, thinks we need a higher form of authentication for online banking, for example. “A user name and password is not enough protection to access a bank account,” he told TechNewsWorld.

“Consumers don’t know where their data is and they can’t control how it’s used. As long as that’s true we need to push business and government and those that have that data to control it better,” Durham said.

Uh, yeah.

Trey Jackson has been a champion of data encryption to protect access to and prevent abuse of existing accounts. BizzyBlog believes that consumers need the ability to freeze their credit files to prevent unauthorized access to them and therefore keep the opening of new credit and other accounts without their knowledge from happening.

This incident, and the likelihood that others are occurring without our knowledge (remember, this was really an accidental discovery), proves that BOTH protections are needed, and NOW.

UPDATE: Here’s Trey’s post from today on the same “incident.”

Paul Weyrich to Have Legs Amputated, Requests Prayers

Filed under: General — Tom @ 6:05 am

World Net Daily reports:

Paul Weyrich, longtime conservative activist and chairman/CEO of the Free Congress Foundation, is scheduled to have his legs amputated this week.

Weyrich, who is also co-founder of the Heritage Foundation, suffered a spinal injury in 1996 and has been bound to a wheelchair since 2001.

A commentator in print and in the media, Weyrich reportedly has asked that supporters pray for him today and Thursday as he undergoes surgery at a Washington area hospital.

I disagreed with Weyrich for what I considered to be unwarranted outside intervention with an imported candidate during Ohio’s Second District GOP primary, but noted at the time that it in my opinion was a rare mistake for someone to whom the whole country owes so much.

He is in my prayers, and I hope he is in yours.