Aaron Swartz, Coder and Activist, Dead at 26

We often say, upon the passing of a friend or loved one, that the world is a poorer place for the loss. But with the untimely death of programmer and activist Aaron Swartz, this isn’t just a sentiment; it’s literally true. Worthy, important causes will surface without a champion equal to their measure. Technological problems will go unsolved, or be solved a little less brilliantly than they might have been. And that’s just what we know. The world is robbed of a half-century of all the things we can’t even imagine Aaron would have accomplished with the remainder of his life.

Aaron Swartz committed suicide Friday in New York. He was 26 years old.

When he was a 14 years old, Aaron helped develop the RSS standard; he went on to found Infogami, which became part of Reddit. But more than anything Aaron was a coder with a conscience: a tireless and talented hacker who poured his energy into issues like network neutrality, copyright reform and information freedom.  Among countless causes, he worked with Larry Lessig at the launch of the Creative Commons, architected the Internet Archive’s free public catalog of books, OpenLibrary.org, and in 2010 founded Demand Progress, a non-profit group that helped drive successful grassroots opposition to SOPA last year.

“Aaron was steadfast in his dedication to building a better and open world,” writes Internet Archive founder Brewster Kahle. “He is among the best spirits of the Internet generation. I am crushed by his loss, but will continue to be enlightened by his work and dedication.”

In 2006 Aaron was part of a small team that sold Reddit to Condé Nast , Wired’s parent company. For a few months he worked in our office here in San Francisco.  I knew Aaron then and since, and I liked him a lot — honestly, I loved him. He was funny, smart, sweet and selfless. In the vanishingly small community of socially and politically active coders, Aaron stood out not just for his talent and passion, but for floating above infighting and reputational cannibalism.  His death is a tragedy.

I don’t know why he killed himself, but Aaron has written openly about suffering from depression. It couldn’t have helped that he faced a looming federal criminal trial in Boston on hacking and fraud charges, over a headstrong stunt in which he arranged to download millions of academic articles from the JSTOR subscription database for free from September 2010 to January 2011, with plans to release them to the public.

JSTOR provides searchable, digitized copies of academic journals online. MIT had a subscription to the database, so Aaron brought a laptop onto MIT’s campus, plugged it into the student network and ran a script called keepgrabbing.py that aggressively — and at times disruptively — downloaded one article after another. When MIT tried to block the downloads, a cat-and-mouse game ensued, culminating in Swartz entering a networking closet on the campus, secretly wiring up an Acer laptop to the network, and leaving it there hidden under a box. A member of MIT’s tech staff discovered it, and Aaron was arrested by campus police when he returned to pick up the machine.

The JSTOR hack was not Aaron’s first experiment in liberating costly public documents. In 2008, the federal court system briefly allowed free access to its court records system, Pacer, which normally charged the public eight cents per page. The free access was only available from computers at 17 libraries across the country, so Aaron went to one of them and installed a small PERL script he had written that cycled sequentially through case numbers, requesting a new document from Pacer every three seconds, and uploading it to the cloud. Aaron pulled nearly 20 million pages of public court documents, which are now available for free on the Internet Archive.

The FBI investigated that hack, but in the end no charges were filed. Aaron wasn’t so lucky with the JSTOR matter. The case was picked up by Assistant U.S. Attorney Steve Heymann in Boston, the cybercrime prosecutor who won a record 20-year prison stretch for TJX hacker Albert Gonzalez. Heymann indicted Aaron on 13 counts of wire fraud, computer intrusion and reckless damage. The case has been wending through pre-trial motions for 18 months, and was set for jury trial on April 1.

Larry Lessig, who worked closely with Aaron for years, disapproves of Aaron’s JSTOR hack. But in the painful aftermath of Aaron’s suicide, Lessig faults the government for pursuing Aaron with such vigor. “[Aaron] is gone today, driven to the edge by what a decent society would only call bullying,” Lessig writes. “I get wrong. But I also get proportionality. And if you don’t get both, you don’t deserve to have the power of the United States government behind you.”

Update: Aaron’s parents, Robert and Susan Swartz, his two brothers and his partner, Taren Stinebrickner-Kauffman, have established a memorial website for him, and released this statement.

Our beloved brother, son, friend, and partner Aaron Swartz hanged himself on Friday in his Brooklyn apartment. We are in shock, and have not yet come to terms with his passing.

Aaron’s insatiable curiosity, creativity, and brilliance; his reflexive empathy and capacity for selfless, boundless love; his refusal to accept injustice as inevitable—these gifts made the world, and our lives, far brighter. We’re grateful for our time with him, to those who loved him and stood with him, and to all of those who continue his work for a better world.

Aaron’s commitment to social justice was profound, and defined his life. He was instrumental to the defeat of an Internet censorship bill; he fought for a more democratic, open, and accountable political system; and he helped to create, build, and preserve a dizzying range of scholarly projects that extended the scope and accessibility of human knowledge. He used his prodigious skills as a programmer and technologist not to enrich himself but to make the Internet and the world a fairer, better place. His deeply humane writing touched minds and hearts across generations and continents. He earned the friendship of thousands and the respect and support of millions more.

Aaron’s death is not simply a personal tragedy. It is the product of a criminal justice system rife with intimidation and prosecutorial overreach. Decisions made by officials in the Massachusetts U.S. Attorney’s office and at MIT contributed to his death. The US Attorney’s office pursued an exceptionally harsh array of charges, carrying potentially over 30 years in prison, to punish an alleged crime that had no victims. Meanwhile, unlike JSTOR, MIT refused to stand up for Aaron and its own community’s most cherished principles.

Today, we grieve for the extraordinary and irreplaceable man that we have lost.

—

Quinn Norton: My Aaron Swartz, whom I loved

Corey Doctorow: RIP, Aaron Swartz

Alex Stamos: The Truth about Aaron Swartz’s “Crime”

Photo: Flickr/Creative Commons

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Milan Fashion Week starts on somber note

MILAN (AP) — Milan Fashion Week started off on a somber note Saturday, as the design world maintained a vigil for the missing CEO of the family-run Missoni fashion house.

The Italian National Fashion Chamber urged the fashion community to post messages on social networks to keep pressure on authorities not to abandon the search for Vittorio Missoni and five others who disappeared aboard a twin-engine plane near Venezuelan islands on Jan. 5.

Designers expressed their solidarity with the family on the first day of menswear previews Saturday.

“No one better than me can understand the pain and anguish that they are experiencing, the suffering of the sister Angela,” Donatella Versace told Italian reporters before her menswear preview. Versace’s brother, Gianni, the founder of the company, was killed by a gunman in Miami in July 1997.

Despite the uncertainty, the Missoni fashion house confirmed its menswear preview show for Sunday. In a message posted on Facebook, designer Angela Missoni, Vittorio’s sister, expressed gratitude for messages of support. Their brother, Luca, a trained pilot, was in Venezuela helping with the search.

“They did very well to confirm the appointment with the new collection. Vittorio would have done the same,” said Mario Boselli, head of the fashion chamber.

Thirty-seven brands were holding fashion shows to present their menswear collections for next winter over four days.

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DOLCE&GABBANA

Dolce and Gabbana’s menswear collection for next winter is pure masculinity, infused with southern romanticism.

With motifs of winter roses, illuminated Madonnas and baroque embossing, the 2014 winter menswear collection evokes the design house’s Sicilian roots. And to drive home the point, the designing duo chose ordinary Sicilians as their models, as they have done in the past, filling the runway with men who were more muscular, with more pronounced features and often shorter than those usually seen in fashion.

Cinched high-waist pleated pants strongly suggested a bygone era. Trouser lengths varied from calf to ankle, straight or cuffed, while jacket, coats and vests ranged from short waist cuts to long overcoats.

In its most basic iteration, the collection featured black pants paired with white blousons or dark ribbed sweaters — the clothes of a craftsman, a fisherman, a laborer. Detailing like an overlay of white lace on the blousons elevated the look far above mere utility.

And there were also garments fitting of the merchant class — rich brocade jackets and thick furry overcoats and velvet suits. These more formal clothes, including a dark suit jacket overlayed with white lace and finished with velvet trim, could be worn for business, a personal celebration or to Sunday Mass.

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BURBERRY PRORSUM

Tradition meets innovation in Burberry Prorsum‘s new winter looks for men.

The “I Love Classics” collection — or made more technology-friendly, I (heart) Classics — focuses heavily on outerwear, from the classic trench and duffel, to topcoats, Chesterfields and bombers.

While diving deep into Burberry’s archives, designer Christopher Bailey managed also to have fun, adding a touch of whimsy with repeating heart motifs and oversizing military-inspired accents.

“I liked the idea of celebrating things that are familiar, classic, the kind of classic Burberry, classic menswear,” Bailey said backstage. “But I wanted to be playful as well.”

Bailey married innovation and levity in traditional coats made of light-weight transparent rubber with a repeating heart lining. Bailey said Burberry developed the rubber to be silky to the touch. Cashmere also gets special treatment, with new finishes and bonding to alter the texture.

Colors followed the classic line — camel, bone, olive, navy and black — with deep reds and dark royal purple.

Maintaining a light mood, animal prints also accented classic bags, complementing the Burberry check pattern, and also adorned shoes and boots. Animal print sunglasses complete the look.

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JIL SANDER

Tall, almost Puritan collars gave gravitas to Jil Sander’s first winter menswear collection since returning to the label she founded.

The ample lapels made prominent in the collection for next fall/winter often contrasted in tone or texture with the jacket or sweater they accented, and were sometimes layered over more traditional notched lapels. Short-cropped hair kept the focus on neckline.

Suit jackets were kept mostly shorter and allowed to billow slightly in the back. This permitted whimsical layering with longer sweaters underneath — and most of the suits were finished with sweaters, crew necks or mock turtlenecks, rather than shirts. Pants were straight, and ankle-length, giving way to well-polished boots.

While the looks adhered to the line’s minimalist credo — simplicity and clean lines — there was nothing austere about it.

The colors and fabrics were both lush and luxurious. Crimson, cobalt and pine contrasted soothingly with more sober grays and black. Even strong shades were easy on the eyes. Materials included chunky corduroy, cashmere knit and leather.

For fun, Sander offered sleeveless pull-over vests, leaving arms and shoulders bare, and sometimes bi-colored in Harlequin fashion. For more serious moments, there were double-breasted pinstripes, distinguished with monochrome panels.

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ZEGNA

Cyber-kinetic patterns give energy to classic looks by Ermenegildo Zegna.

Zegna signals a push for innovation in the title of the collection: “Style for Change.”

Zegna zips up the double-breasted suit with graphic lines, while repeating patterns of dots fused into lines give motion to overcoats.

Gray dominates the collection, giving it an urban flair.

The basic look forms around suits, paired with slim, elegant ties or scoop-neck sweaters. Trousers are straight cut without being tight, and might include a cummerbund that elongate the look.

Much attention is flourished on collars, which when small might be decorated with a clip, or when oversized adorned with a clasp.

Textures operate in contrast. Soft alpaca coats are worn over tailored suits.

Shoes taper to a point, while bags span a range from travel backs to computer totes.

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City Room: Cuomo Declares Public Health Emergency Over Flu Outbreak

With the nation in the grip of a severe influenza outbreak that has seen deaths reach epidemic levels, New York State declared a public health emergency on Saturday, making access to vaccines more easily available.

There have been nearly 20,000 cases of flu reported across the state so far this season, officials said. Last season, 4,400 positive laboratory tests were reported.

“We are experiencing the worst flu season since at least 2009, and influenza activity in New York State is widespread, with cases reported in all 57 counties and all five boroughs of New York City,” Gov. Andrew M. Cuomo said in a statement.

Under the order, pharmacists will be allowed to administer flu vaccinations to patients between 6 months and 18 years old, temporarily suspending a state law that prohibits pharmacists from administering immunizations to children.

While children and older people tend to be the most likely to become seriously ill from the flu, Mr. Cuomo urged all New Yorkers to get vaccinated.

On Friday, the Centers for Disease Control and Prevention in Atlanta said that deaths from the flu had reached epidemic levels, with at least 20 children having died nationwide. Officials cautioned that deaths from pneumonia and the flu typically reach epidemic levels for a week or two every year. The severity of the outbreak will be determined by how long the death toll remains high or if it climbs higher.

There was some evidence that caseloads may be peaking, federal officials said on Friday.

In New York City, public health officials announced on Thursday that flu-related illnesses had reached epidemic levels, and they joined the chorus of authorities urging people to get vaccinated.

“It’s a bad year,” the city’s health commissioner, Dr. Thomas A. Farley, told reporters on Thursday. “We’ve got lots of flu, it’s mainly type AH3N2, which tends to be a little more severe. So we’re seeing plenty of cases of flu and plenty of people sick with flu. Our message for any people who are listening to this is it’s still not too late to get your flu shot.”

There has been a spike in the number of people going to emergency rooms over the past two weeks with flulike symptoms – including fever, fatigue and coughing – Dr. Farley said.

Mayor Michael R. Bloomberg and Mr. Cuomo made a public display of getting shots this past week.

In a briefing with reporters on Friday, officials from the C.D.C. said that this year’s vaccine was effective in 62 percent of cases.

As officials have stepped up their efforts encouraging vaccinations, there have been scattered reports of shortages. But officials said plenty of the vaccine was available.

According to the C.D.C., makers of the flu vaccine produced about 135 million doses for this year. As of early this month, 128 million doses had been distributed. While that would not be enough for every American, only 37 percent of the population get a flu shot each year.

Federal health officials said they would be happy if that number rose to 50 percent, which would mean that there would be more than enough vaccine for anyone who wanted to be immunized.

Two other diseases – norovirus and whooping cough – are also widespread this winter and are contributing to the number of people getting sick.

The flu can resemble a cold, though the symptoms come on more rapidly and are more severe.

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Treasury Will Not Mint $1 Trillion Coin to Raise Debt Ceiling

WASHINGTON — The Treasury Department said Saturday that it will not mint a trillion-dollar platinum coin to head off an imminent battle with Congress over raising the government’s borrowing limit.

“Neither the Treasury Department nor the Federal Reserve believes that the law can or should be used to facilitate the production of platinum coins for the purpose of avoiding an increase in the debt limit,” Anthony Coley, a Treasury spokesman, said in a written statement.

The Obama administration has indicated that the only way for the country to avoid a cash-management crisis as soon as next month is for Congress to raise the “debt ceiling,” which is the statutory limit on government borrowing. The cap is $16.4 trillion.

“There are only two options to deal with the debt limit: Congress can pay its bills, or it can fail to act and put the nation into default,” Jay Carney, the White House press secretary, said in a statement. “Congress needs to do its job.”

In recent weeks, some Republicans have indicated that they would not agree to raise the debt limit unless Democrats agreed to make cuts to entitlement programs like Social Security.

The White House has said it would not negotiate spending cuts in exchange for Congressional authority to borrow more, and it has insisted that Congress raise the ceiling as a matter of course, to cover expenses already authorized by Congress. In broader fiscal negotiations, it has said it would not agree to spending cuts without commensurate tax increases.

The idea of minting a trillion-dollar coin drew wide if puzzling attention recently after some bloggers and economic commentators had suggested it as an alternative to involving Congress.

By virtue of an obscure law meant to apply to commemorative coins, the Treasury secretary could order the production of a high-denomination platinum coin and deposit it at the Federal Reserve, where it would count as a government asset and give the country more breathing room under its debt ceiling. Once Congress raised the debt ceiling, the Treasury secretary could then order the coin destroyed.

Mr. Carney, the press secretary, fielded questions about the theoretical tactic at a news conference last week. But the idea is now formally off the table.

The White House has also rejected the idea that it could mount a challenge to the debt ceiling itself, on the strength of the Fourteenth Amendment to the Constitution, which holds that the “validity of the public debt” of the United States “shall not be questioned.”

The Washington Post earlier published a report that the Obama administration had rejected the platinum-coin idea.

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James' spending in mayor's race far outpaces fundraising

Kevin James, the sole Republican among the main contenders in the Los Angeles mayor's race, raised a little more than $42,000 in the final quarter of 2012, but spent more than four times that amount, largely on high-priced political consultants.

James, an attorney and former talk radio host who has never held elected office, spent $178,595 in the fourth quarter, a few thousand shy of top-tier candidate and key rival Wendy Greuel, according to campaign finance documents filed with the City Ethics Commission on Thursday. Greuel has vastly outpaced James in fundraising, raising roughly $630,000 more than James in the same period.

The biggest beneficiaries of James' spending are political consultants, including John Weaver, a top national GOP operative who was a senior advisor to the short-lived presidential campaign of Jon Huntsman in the 2012 presidential campaign. Weaver's firm, the Network Companies, billed James for $78,000 for work in the final three months of the year, and a total of $88,000 for all of 2012.

For the entire campaign, James' expenses also included $122,160 for Thomas Partners Strategies, $68,493 for the Prise Group, $40,175 for Capital Campaigns, $25,586 for Crummitt & Associates, $18,011 for Midnite Oil Media and $10,000 for Venture Strategic.

James' representatives said these expenditures represented a strategic decision to build a robust campaign.

"These investments will lead him to victory and get him into the runoff," campaign manager Jeff Corless said. "He has a professional team that has helped him achieve great success thus far in the campaign."

He added that a fundraising lull at the end of 2012 was to be expected because of the holidays and political fatigue. The campaign has seen a surge in fundraising in recent weeks and planned to start reaching out to voters Monday, Corless said.

In heavily Democratic Los Angeles, James is a long-shot candidate. But his outsider message has attracted attention, and some see a path for him earn a top-two spot in the March primary, advancing him to a May runoff. To do so, James must make sure Republicans turn out while also siphoning support of conservative Democrats, notably in the San Fernando Valley, from Greuel.

Greuel's campaign said James' spending showed that his effort will be futile, not only because of the rate of spending, but because of what he is spending his resources on.

"Kevin James is quickly burning a hole in his pocket, and if he keeps up his anemic fundraising pace, soon he'll be flat broke and in the hole," said Rose Kapolczynski, Greuel's campaign manager.

James' saving grace could rest on the success of an independent committee formed to support his candidacy that can collect unlimited donations.

"It's been fairly clear for a while now that if James is going to make a race of it, it's going to come predominantly through outside spending. The amount he's raised and spent on his own campaign is less relevant," said Dan Schnur, director of the Jesse M. Unruh Institute of Politics at USC and a former GOP political operative. "James can't get elected solely on the strength of Super PAC money but a well-funded outside campaign can do significant damage to the other candidates."

But Schnur said the amount the Super PAC has collected so far, $200,000 is not sufficient.

Fred Davis, the GOP ad specialist who is running the group, Better Way L.A., said that he remains confident.

"The frustrating thing was the holidays. We really didn't get started until Jan. 4 and 5. It just was a tough time," he said. "But over the last week, we've been on daily conference calls. Things look good . It will be a race down the wire, we still think we'll make it into the runoff."

seema.mehta@latimes.com

Times staff writer Maeve Reston contributed to this report.

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Student Appeals Suspension for Refusing to Wear RFID Tracker

A Texas high school student on Friday asked a federal appeals court to overturn a lower court’s order upholding her school suspension for refusing to wear around her neck an RFID-chip student ID she claims is the “Mark of the Beast.”

The Northside Independent School District in San Antonio began issuing the RFID-laden student-body cards when the semester began in the fall. The ID badge has a bar code associated with a student’s Social Security number. The chip monitors pupils’ movements on campus, from when they arrive until when they leave.

Sophomore Andrea Hernandez was notified in November by the Northside Independent School District in San Antonio that she would not be able to continue attending John Jay High unless she wears the badge around her neck like all students. The district said the girl, who objects largely on religious grounds, would have to attend another high school that does not employ the RFID tags.

The devout Christian sued, and on Tuesday a Texas federal judge concluded the 15-year-old’s right of religion was not breached. That’s because the district, the court ruled, eventually agreed to accommodate the girl and allow her to remove the RFID chip while still demanding that she wear the identification like the other students.

U.S. District Judge Orlando Garcia’s ruling gave the girl and her family until Jan. 18 to decide whether to go to a different school or comport. She appealed Friday, arguing that adorning herself with the ID card, even one without an RFID chip, amounted to discriminating against her “sincerely held beliefs.”

“To Andrea, this ‘accommodation’ is similar to allowing a religious adherent who must eat a pork-free diet to have his pork-free diet, but to require him to wear a shirt advocating pork,” the girl’s attorney, Jerry Lynn Ward of the Rutherford Institute, wrote the New Orleans-based appeals court. (.pdf) The lower court’s decision, Ward added, “unquestionably constitutes a substantial burden upon her free exercise of religion.”

David Kravets is a senior staff writer for Wired.com and founder of the fake news site TheYellowDailyNews.com. He's a dad of two boys and has been a reporter since the manual typewriter days.

Read more by David Kravets

Follow @dmkravets and @ThreatLevel on Twitter.

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“Gangster Squad” takes $650K in midnight showings, battle with “Zero Dark Thirty” awaits

NEW YORK (TheWrap.com) – Warner Bros.’ “Gangster Squad” grossed $ 650,000 in midnight showings Thursday night, a strong start to what should be a weekend-long fight for the box-office crown.

Ruben Fleischer’s tale of cops and organized crime in mid-20th century Los Angeles will duke it out with Kathryn Bigelow’s “Zero Dark Thirty,” the Oscar contender that expands to almost 3,000 screens this weekend.

Box office experts projected “Zero Dark Thirty” would eke out the win before the weekend began, though it remains a close race with both movies looking at openings of about $ 20 million.

“Gangster Squad,” which stars Josh Brolin, Ryan Gosling, Emma Stone and Sean Penn, has a breezy action feel, and runs under two hours. Despite a strong cast, reviewers have not responded warmly to the film, which charts at 43 percent on Metacritic and 34 percent on Rotten Tomatoes.

The Academy rewarded “Zero Dark Thirty” with five Oscar nominations on Thursday buffeting its pursuit of viewers despite its two hour and 37 minute length.

Warner Bros. did not immediately respond to TheWrap’s request for comment.

Movies News Headlines – Yahoo! News

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No Jail Time for Doctor, 85, Convicted of Drug Charge

The former doctor sat in courton Friday waiting to be sentenced for a crime that breached every tenet of his professional code. He had run his house in Staten Island like a drug mill, selling the prescription painkiller oxycodone to all comers — including undercover federal agents. The guideline sentence for his crimes was up to six years.

But just by the look of the defendant, Felix Lanting, it seemed likely that he would never serve that much time. Frail and hunched-over at 85, he could only hope to live that long. And with a wife even frailer who depends on him for care, he posed a special challenge for the sentencing judge, Roslynn R. Mauskopf.

A lawyer for Mr. Lanting, James R. Froccaro, asked that his client receive no jail time at all.

“I’m agonizing about what to do,” said Judge Mauskopf, who presided over the case in United States District Court for the Eastern District.

Mr. Lanting’s crimes are typically committed by men a generation younger. A 2010 investigation by the Federal Bureau of Investigation found that in seven months, Mr. Lanting wrote and sold more than 3,000 prescriptions for oxycodone, an average of 15 per day, seven days a week.

Neighbors complained about the foot traffic. A relative of someone who overdosed on the pills attacked the front door of Mr. Lanting’s house with an ax. Mr. Lanting hired bouncers to protect his growing business, but they did not stop the undercover agents. When F.B.I. agents arrested him, they found $37,000 in cash and 100 solid silver bars. Eighty thousand dollars more turned up in a safe-deposit box.

In court on Friday, Mr. Lanting, who lost his medical license, stood and pleaded for his life and that of his wife. “I beg the court not to put me in jail because my wife will die,” he said. “I am the only one who is taking care of her.”

He began to cry. “I’m very sorry. I made a mistake. If I could undo it, I would. I’m begging you please.” Judge Mauskopf called a five-minute recess to think.

“If there ever were a case that cried out for mitigation, it is this one, based on the defendant’s age and based on the responsibilities to his wife,” Judge Mauskopf said when she returned. But she said she wanted to punish him.

She sentenced him to six months of house arrest, five years of probation and a $25,000 fine. She said Mr. Lanting might have to get someone else to take his wife to her medical visits.

“You need to feel the restrictions on your liberty,” she said. “The fine is meant to hurt and to punish you for what you did.”

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DealBook: Wells Fargo's Mortgage Gains May Be Unsustainable

8:40 p.m. | Updated

Wells Fargo has turned its mortgage business into an enormous profit machine. The San Francisco-based bank posted earnings of $5.1 billion in the fourth quarter, a 24 percent increase from the previous year.

But its strong gains may not be sustainable, unless interest rates drop significantly or the housing market recovers substantially. Both are long shots.

“Rates really don’t have to go up very much to discourage a whole swath of people from returning to the housing market,” said Lance Roberts, chief economist at StreetTalk Advisors, an investment advisory firm.

In recent years, Wells Fargo has aggressively expanded its mortgage business, a strategy that has helped drive record profits. The company reported net income of $18.9 billion in 2012, up 19 percent from 2011. Revenue rose 6 percent in the same period.

“We saw robust growth across the entire bank, proving that there is a lot of value in a strong, diversified business,” said Timothy J. Sloan, chief financial officer of Wells Fargo.

But after 12 consecutive quarters of rising profits, Wells Fargo may find it difficult to keep up the pace.

The bank’s recent mortgage profits largely reflect the government’s efforts to stimulate the economy, rather than a robust recovery in the housing market.

As the Federal Reserve has cut interest rates, millions of borrowers have refinanced their home loans to reduce costs. Refinancing accounted for 72 percent of Wells Fargo’s mortgage origination in the fourth quarter.

That business has been especially lucrative of late.

Banks pass on most of their mortgages to government entities like Fannie Mae and Freddie Mac, which guarantee that the loans will be repaid. With the guarantee attached, banks sell the mortgages to bond investors and book a financial gain.

Profits have ballooned with the government intervention. The Fed has been a big buyer of mortgage bonds in an effort to drive down interest rates. But banks have not cut ordinary borrowers’ rates by the same amount.

That means the difference, or spread, between the rates increased last year. Wells Fargo’s gains from this activity totaled $10.3 billion in 2012, more than double the previous year.

Those gains may be hard to beat.

While the Fed has promised to purchase more mortgage bonds, interest rates may not fall much further. If mortgage rates stagnate or rise, fewer borrowers are likely to refinance or buy a house. And if the mortgage bond market weakens, banks will make less of a gain when selling the mortgages.

Already, refinancing activity appears to be slowing. In the fourth quarter, Wells Fargo handled $125 billion of mortgage originations, up 4 percent from the previous year. But loan production was higher earlier in the year, peaking at $139 billion in the third quarter.

At the same time, the Fed’s low rates are actually hurting other parts of the business. An important measure of a bank’s overall lending profitability, the net interest margin, has eroded. In the fourth quarter, Wells Fargo’s net interest margin dropped slightly to 3.56 percent, from 3.89 percent a year earlier.

Investors shrugged off the strong profits because of such concerns. Wells Fargo’s shares fell slightly on Friday, to $35.10, a 0.85 percent drop.

In an effort to assuage investors’ concerns about the refinancing business, Mr. Sloan, the chief financial officer, said in a conference call on Friday that he saw “billions of dollars in refinancing opportunities.”

Housing market numbers support his optimism. Over 70 percent of mortgages had interest rates above 4 percent in the fall, according to CoreLogic, a housing data firm. Some of those borrowers would benefit financially from refinancing, given that the interest rate on fixed, 30-year loans is 3.4 percent.

If the refinancing boom does sputter, a significant increase in new mortgages could help fill the void. That depends largely on the health of the housing market. While house prices posted annual gains last year, the recovery is far from robust.

Wells Fargo’s servicing business, in which the bank collects payments from homeowners, could also soften the blow. In the fourth quarter, the company reported $926 million in fees from that activity, up 6 percent from a year earlier.

Wells Fargo can also rely on other businesses to pick up some of the slack. In an interview on Friday, Mr. Sloan said that strong loan growth throughout the bank, including in autos and credit cards, reflected potential opportunity.

The bank reported gains in its wealth management business, where profit increased 13 percent, to $351 million. It has also been focusing on its brokerage business as regulations have curbed profits in other areas.

Cost-cutting could be another option. In the past, the bank has shown it can be aggressive on that front.

Recently, Wells Fargo has been developing its online and mobile banking operations so that it can trim staffing costs in its branches. It has also refocused on core businesses and sold units like H. D. Vest Financial Services, which it put on the auction block in 2011.

The company has also cleaned up much of the costly legal mess stemming from the mortgage crisis, striking several deals with federal regulators over the last year. This week, Wells Fargo was among the 10 banks that agreed to an $8.5 billion settlement with the Comptroller of the Currency and the Federal Reserve over claims of shoddy foreclosure practices, including sloppy paperwork used in home seizures and botched loan modifications. Separately, the bank has allotted $1.2 billion to prevent foreclosures.

With the settlement, Wells Fargo puts an end to an expensive foreclosure review that was mandated by regulators. The review cost the bank an estimated $125 million each quarter.

“By putting these issues behind us, we can focus more of our resources on serving our customers,” the bank’s chief executive, John G. Stumpf, told analysts on Friday.

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Irvine City Council overhauls oversight, spending on Great Park

Capping a raucous eight-hour-plus meeting, the Irvine City Council early Wednesday voted to overhaul the oversight and spending on the beleaguered Orange County Great Park while authorizing an audit of the more than $220 million that so far has been spent on the ambitious project.

A newly elected City Council majority voted 3 to 2 to terminate contracts with two firms that had been paid a combined $1.1 million a year for consulting, lobbying, marketing and public relations. One of those firms — Forde & Mollrich public relations — has been paid $12.4 million since county voters approved the Great Park plan in 2002.

"We need to stop talking about building a Great Park and actually start building a Great Park," council member Jeff Lalloway said.

The council, by the same split vote, also changed the composition of the Great Park's board of directors, shedding four non-elected members and handing control to Irvine's five council members.

The actions mark a significant turning point in the decade-long effort to turn the former El Toro Marine base into a 1,447-acre municipal park with man-made canyons, rivers, forests and gardens that planners hoped would rival New York's Central Park.

The city hoped to finish and maintain the park for years to come with $1.4 billion in state redevelopment funds. But that money vanished last year as part of the cutbacks to deal with California's massive budget deficit.

"We've gone through $220 million, but where has it gone?" council member Christina Shea said of the project's initial funding from developers in exchange for the right to build around the site. "The fact of the matter is the money is almost gone. It can't be business as usual."

The council majority said the changes will bring accountability and efficiencies to a project that critics say has been larded with wasteful spending and no-bid contracts. For all that has been spent, only about 200 acres of the park has been developed and half of that is leased to farmers.

But council members Larry Agran and Beth Krom, who have steered the course of the project since its inception, voted against reconfiguring the Great Park's board of directors and canceling the contracts with the two firms.

Krom has called the move a "witch hunt" against her and Agran. Feuding between liberal and conservative factions on the council has long shaped Irvine politics.

"This is a power play," she said. "There's a new sheriff in town."

The council meeting stretched long into the night, with the final vote coming Wednesday at 1:34 a.m. Tensions were high in the packed chambers with cheering, clapping and heckling coming from the crowd.

At one point council member Lalloway lamented that he "couldn't hear himself think."

During public comments, newly elected Orange County Supervisor Todd Spitzer chastised the council for "fighting like schoolchildren." Earlier this week he said that if the Irvine's new council majority can't make progress on the Great Park, he would seek a ballot initiative to have the county take over.

And Spitzer angrily told Agran that his stewardship of the project had been a failure.

"You know what?" he said. "It's their vision now. You're in the minority."

mike.anton@latimes.com

rhea.mahbubani@latimes.com

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