News Corp investors to vote against Murdochs (Reuters)

LONDON (Reuters) – Rupert Murdoch's multi-million dollar campaign to win back the hearts and minds of News Corporation's independent investors suffered a new blow on Friday after another key shareholder group called for his eviction from its board.

Hermes Equity Ownership Services (HEOS), the shareholder advisory service affiliated to Britain's largest pension fund, issued a rallying cry to investors to vote against all Murdoch family re-elections to the board of the embattled media group at next week's annual general meeting on October 21.

"The time is right for the company to appoint an independent chairman to rebuild trust, help correct the governance discount, and ensure that the interests of all investors are properly represented," Jennifer Walmsley, Director of Hermes Equity Ownership Services, said.

"We have a battle on our hands to demonstrate the strength of shareholder opposition because so many shares are held by the family or by people affiliated with the family," she told Reuters.

The organization, which votes on behalf of the BT Pension Fund and more than 20 other institutional clients running $140 billion of assets, has also called for an independent investigation into the phone hacking scandal that led to the closure of top-selling British tabloid The News of the World.

Besides seeking the removal of Murdoch and sons James and Lachlan, HEOS -- whose members hold 0.5 percent of News Corp's shares -- Hermes is also withholding support for the re-election of directors Arthur Siskind and Andrew Knight, citing concerns for their independence.

The statement from HEOS is the latest in a flurry of anti-Murdoch lobbying from corporate governance watchdogs and proxy voting companies all over the world.

Earlier this week, Institutional Shareholder Services Inc. (ISS) said Murdoch and 10 other News Corp directors should be ousted from board in the wake of the phone hacking scandal, which it said "laid bare a striking lack of stewardship and independence."

The ISS statement prompted News Corp, which has bought back more than $1 billion of its stock since August, to step up its appeal for shareholder support with a letter that reiterated its strong financial performance in the face of the flagging global economy.

But Walmsley said investors were growing impatient for fundamental change that would see the infamous 'Murdoch discount' gone for good.

News Corp shares typically trade below rival media groups because the market applies a discount to reflect Murdoch's tight control of the company and a tendency to make decisions that shareholders may not support.

"There's an enormous groundswell of opposition and I think there are a lot of investors out there who feel ... the governance structures in place are clearly not sufficient to safeguard the interests of minority investors," Walmsley said.

"There is a huge problem with shareholder democracy at News Corp -- it breaches what we see as a fundamental shareholder right of 'one share, one vote'," she said.

The war of words between News Corp and its shareholders over the need for a sweeping purge of its board is likely to revive a debate over whether James Murdoch should be forced to give up his role as chairman of British Sky Broadcasting.

Investors in BSkyB -- News Corp's erstwhile bid target -- will vote on the make-up of their board next month.

(Editing by Chris Vellacott and Hans-Juergen Peters)

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AP Enterprise: GOP not always against entitlements (AP)

By RICARDO ALONSO-ZALDIVAR, Associated Press Ricardo Alonso-zaldivar, Associated Press – 1?hr?39?mins?ago

WASHINGTON – It's a massive health care entitlement with unfunded future costs over $7 trillion. Many conservatives are still upset at the way it was rammed through Congress.

But when the Republican presidential candidates were asked last week asked if they would repeal the Medicare drug benefit, they said no way. After all, Republicans created it.

Republicans want to pull the plug on the health care overhaul they call "Obamacare," but that law is arguably less a deficit driver than the Medicare drug plan they are defending.

Debt and deficit are the focus of the Republican Party as the 2012 presidential campaign moves through the nominating process and looks ahead to the general election. Yet the reluctance of GOP candidates to renounce a costly entitlement program that voters like shows how politics can come into play when critiquing the federal ledger.

Passed by a GOP-led Congress in 2003 under President George W. Bush, the prescription program is immensely popular with older people, faithful voters who lately have been trending Republican.

Medicare recipients pay only one-fourth of the cost of the drug benefit. Because there's no dedicated tax to support the program, the other three-fourths comes from the government's general fund. That's the same leaky pot used for defense, law enforcement, education and other priorities. It's regularly refilled with borrowed dollars that balloon the deficit.

Although the health care law costs far more than the drug benefit, it's paid for, at least on paper. It includes unpopular Medicare cuts as well as tax increases on insurers, drug and medical device companies, upper-income people, and even indoor tanning devotees.

Asked last week at the Tea Party debate if they would repeal the prescription program, GOP candidates would hear nothing of it.

Texas Gov. Rick Perry said he would not, even though he said he's concerned about its cost. Cracking down on waste and fraud might be the answer, he suggested.

"I wouldn't repeal it," said former Massachusetts Gov. Mitt Romney. He said he would restructure Medicare, but not for those now in the program or nearing retirement. The re-engineering supported by House Republicans this year and praised by Romney at the time would give future retirees a voucher-like payment to buy insurance from a range of private plans.

Texas Rep. Ron Paul noted that he'd voted against the prescription benefit, but said repeal "sure wouldn't be on my high list. I would find a lot of cuts (in) a lot of other places."

Budget hawks scoff.

"I'm an equal opportunity critic here," said David Walker, a former head of the congressional watchdog agency. "I think the Republicans were irresponsible for passing the Medicare prescription program in 2003 and I think the Democrats were irresponsible for passing" Obama's health overhaul.

As comptroller general of the Government Accountability Office for most of the past decade, Walker used his position to call attention to the nation's long-term budget problems at a time when the debt wasn't front-page news. He now leads the Comeback America Initiative, a nonpartisan group promoting fiscal responsibility.

"There was no attempt to offset the cost of the Medicare prescription bill," Walker said. "It's fair to say that at least there was an attempt to pay" for the health law through a mix of spending cuts and tax increases.

How big is the hole left by the prescription program? Over the next 75 years, its $7.5 trillion "unfunded obligation" exceeds the $6.7 trillion gap attributable to Social Security.

"When they were designing the new health care law, the experience of the Medicare prescription bill was very much in their minds," said Robert Bixby, executive director of the Concord Coalition, a nonpartisan group advocating fiscal discipline. "They didn't want to have another unfunded expansion."

Experts can debate whether future Congresses will suspend Obama's Medicare cuts and whether the long-range cost of extending coverage to more than 30 million uninsured will outpace the revenue to pay for it.

As the reactions of the GOP candidates at the debate demonstrated, no one is seriously considering repeal of the prescription program.

Thanks to taxpayers, about 90 percent of older people now have affordable access to medications that help keep them out of the hospital. Roughly two-thirds of those are enrolled in Medicare's benefit; many others are in former employers' prescription plans.

Ironically, repealing Obama's overhaul would take away the most important improvement to the program since it was created. Obama's law gradually eliminates the dreaded coverage gap known as the doughnut hole. Millions of people will each save thousands of dollars as a result.

Republicans like to point out that the cost of the prescription program is well below original estimates. They attribute that to competition among the private insurers providing the benefit.

While competition is part of the story, experts say it's not the only reason. The shift to cheaper generic drugs among people of all ages has been a powerful contributor. That may not last forever. The trustees who oversee Medicare's finances warn in their latest report that spending on drugs will rise more rapidly in the future.

Said Walker: "Basically what's happening is we're mortgaging the future of our children and grandchildren, and borrowing the money from China."

____

Online:

Medicare prescription drug plan: http://tinyurl.com/24xy54j

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Appeals court rules against Obama healthcare law (Reuters)

WASHINGTON (Reuters) – An appeals court ruled Friday that President Barack Obama's healthcare law requiring Americans to buy healthcare insurance or face a penalty was unconstitutional, a blow to the White House.

The Appeals Court for the 11th Circuit, based in Atlanta, found that Congress exceeded its authority by requiring Americans to buy coverage, but also ruled that the rest of the wide-ranging law could remain in effect.

The legality of the so-called individual mandate, a cornerstone of the 2010 healthcare law, is widely expected to be decided by the Supreme Court. The Obama administration has defended the provision as constitutional.

The case stems from a challenge by 26 U.S. states which had argued the individual mandate, set to go into effect in 2014, was unconstitutional because Congress could not force Americans to buy health insurance or face the prospect of a penalty.

"This economic mandate represents a wholly novel and potentially unbounded assertion of congressional authority: the ability to compel Americans to purchase an expensive health insurance product they have elected not to buy, and to make them re-purchase that insurance product every month for their entire lives," a divided three-judge panel said.

Obama and his administration had pressed for the law to help halt the steep increases in healthcare costs and expand insurance coverage to the more than 30 million Americans who are without it.

It argued that the requirement was legal under the Commerce Clause of the Constitution. One of the three judges of the appeals court panel, Stanley Marcus, agreed with the administration in dissenting from the majority opinion.

The majority "has ignored the undeniable fact that Congress' commerce power has grown exponentially over the past two centuries and is now generally accepted as having afforded Congress the authority to create rules regulating large areas of our national economy," Marcus wrote.

Many other provisions of the healthcare law are already being implemented.

The decision contrasts with one by the U.S. Appeals Court for the 6th Circuit, based in Cincinnati, which had upheld the individual mandate as constitutional. That case has already been appealed to the Supreme Court.

The Court of Appeals for the 4th Circuit, based in Richmond, has yet to rule on a separate challenge by the state of Virginia.

(Reporting by Jeremy Pelofsky and James Vicini; Editing by Eric Beech)

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Assad says Syria won't stop fight against "terrorists" (Reuters)

AMMAN (Reuters) – Syrian President Bashar al-Assad said on Tuesday his forces would continue to pursue "terrorist groups," after Turkey pressed him to end a military assault aimed at crushing protests against his rule.

Syria "will not relent in pursuing the terrorist groups in order to protect the stability of the country and the security of the citizens," state news agency SANA quoted Assad as telling Turkish Foreign Minister Ahmet Davutoglu.

"But (Syria) is also determined to continue reforms ... and is open to any help offered by friendly and brotherly states."

While the two men held talks in Damascus, Syrian forces killed at least 30 people and moved into a town near the Turkish border, an activist group said.

The National Organization for Human Rights said most of the fatalities occurred when troops backed by tanks and armored vehicles overran villages north of Hama, while four were killed in Binnish, 30 km (20 miles) from the border with Turkey.

Despite growing international condemnation, including a sudden wave of Arab criticism, Assad's forces also pursued an offensive in the eastern city of Deir al-Zor, residents said.

Activists say at least 1,600 civilians have died since the uprising against Assad erupted in March, making it one of the bloodiest of the upheavals sweeping the Arab world.

Davutoglu held six hours of meetings with Syrian officials, including a two-hour session alone with Assad.

Neighbouring Turkey has grown increasingly critical of the violence but earned a sharp rebuke on Sunday when an Assad adviser said Syria would not accept interference in its affairs.

U.S. Secretary of State Hillary Clinton had asked Davutoglu to reinforce a demand from Washington that Syria return the army to barracks immediately and release prisoners.

Syria has faced nearly five months of protests against Assad's 11-year rule, inspired by Arab revolts which overthrew leaders in Egypt and Tunisia earlier this year.

Last week Assad sent troops and tanks to quell the mostly Sunni Muslim city of Hama in central Syria and the army launched a similar assault on Sunday against Deir al-Zor.

An armored column also pushed toward the center of the city on Tuesday, with troops storming houses and making arrests in the provincial capital of an oil region bordering Iraq's Sunni heartland, a resident said.

"They are now about one kilometer from downtown. When they finish with one district, they move to another," said the resident, who gave his name as Iyad.

GROWING ISOLATION

Turkish Prime Minister Tayyip Erdogan has described Syria's uprising as a domestic issue for Turkey, because of their 850 km (530 mile) shared border.

Increasing the pressure on Assad, Sunni Muslim power Saudi Arabia issued a blunt warning that he risked turmoil unless he stopped the bloodshed and adopted reforms. Kuwait and Bahrain followed the kingdom in recalling their ambassadors.

The withdrawal of envoys left Assad with few diplomatic friends bar Iran. Western states have imposed sanctions on his top officials, while states with close ties to Damascus such as Russia and Turkey have warned Assad he is running out of time.

Nevertheless, no country has proposed military action such as that launched against Libya's leader Muammar Gaddafi.

In Deir al-Zor, a resident said on Monday 65 people had been killed since tanks and armored vehicles barreled into the city, 400 km (250 miles) northeast of Damascus on Sunday.

The British-based Syrian Observatory of Human Rights said among the dead were a mother and her two children, an elderly woman and a girl. Syria has expelled most independent media since the revolt began, making it hard to confirm accounts.

Syrian authorities have denied that any Deir al-Zor assault took place. The official state news agency said "not a single tank has entered Deir al-Zor" and reports of tanks in the city were "the work of provocateur satellite channels."

The authorities say they have faced attacks since the protests erupted in March, blaming armed saboteurs for civilian deaths and accusing them of killing 500 security personnel.

State television broadcast footage on Sunday of mutilated bodies floating in the Orontes river in Hama, saying 17 police had been ambushed and killed in the central Syrian city.

The official SANA news agency said on Monday the military was starting to pull out of Hama after it said they had helped restore order. Residents said there were still tanks in parts of the city and security forces were making arrests.

About 1,500 people were detained in Hama's Jarajima district and troops killed three civilians, the Observatory said.

Activists say at least 130 people were killed in Hama, where Assad's father crushed an armed Islamist uprising in 1982, and one group has put the death toll at over 300.

Like most of Syria, ruled by Assad's minority Alawite family, Hama and Deir al-Zor are mainly Sunni cities, and the crackdowns there resonate with Sunnis, who form the majority in the region and govern most Arab countries.

(Additional reporting by Mariam Karouny in Beirut and Ankara bureau; Writing by Dominic Evans; Editing by Jon Hemming)

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Civil suit against Strauss-Kahn still seen viable (Reuters)

NEW YORK (Reuters) – The question has floated in the background for nearly two months, ever since police arrested Dominique Strauss-Kahn on charges of sexually assaulting a New York hotel maid: Would his accuser pursue a civil suit against him?

The answer has changed little since serious doubts about the woman's credibility put in jeopardy the criminal case against the former International Monetary Fund chief.

A successful civil case could bring a multimillion-dollar judgment against Strauss-Kahn, if a jury finds his accuser's story persuasive.

Civil litigators say the accuser would still have viable civil claims against Strauss-Kahn even if criminal charges against him are dismissed. But any judgment against him would prove difficult to enforce if the prosecution ends and he returns home to France.

"A civil case could certainly still succeed on the merits," said Meg Garvin, the executive director of the National Crime Victim Law Institute at Lewis & Clark University Law School in Oregon.

Civil lawsuits do proceed after criminal prosecutions fail. The former American football player O.J. Simpson, charged with killing his ex-wife and her friend, was acquitted in 1995 but later found liable in a wrongful-death civil suit brought by the victims' families and ordered to pay more than $30 million in damages.

In 2004, prosecutors dropped rape charges against Kobe Bryant, the basketball star, when his accuser refused to testify, but she filed a lawsuit against him and settled the case out of court for an unspecified amount.

The lawyers for the accuser in the Strauss-Kahn case have said they are not considering a lawsuit and did not respond to requests for comment.

BURDEN OF PROOF

Criminal and civil trials have significantly different burdens of proof required to prevail.

In a criminal case, where a guilty verdict can result in imprisonment, prosecutors must prove the defendant's guilt beyond reasonable doubt, the law's strictest standard.

In civil cases, where the loser is liable for money damages, the standard is a "preponderance of the evidence" -- essentially, that it was more likely than not that the defendant was responsible.

This distinction can be particularly appealing to a witness who, like Strauss-Kahn's accuser, has credibility problems.

Prosecutors revealed she had told authorities numerous lies, including fabricating a story about being gang-raped in Guinea in order to gain U.S. asylum. She also changed details of her story about what happened after her encounter with Strauss-Kahn in his luxury hotel suite, though her account about what took place in the room has remained steadfast.

"There's nothing from what I've heard about the alleged problems with the case that would make me immediately shy away," said John Clune, the lawyer who represented the accuser in the Bryant case.

Unlike in a criminal case, where a jury may not draw any conclusions from a defendant's decision not to testify, civil defendants typically must give their side during depositions and at trial. There is no Fifth Amendment protection against self-incrimination, and if a defendant refuses to answer, the jury is permitted to make inferences from that refusal.

In Strauss-Kahn's case, a civil suit could shift the focus from her credibility to his own record of honesty, given reports about his past infidelities.

"This is exactly why civil defendants settle all the time," said Julie Suk, a professor at Cardozo School of Law. "They may not think there's a winnable case against them, but it's often much more costly, both in terms of lawyer fees and personal, psychic cost."

Given Strauss-Kahn's wealth, his accuser still risks being perceived as having financial motives in going after him.

According to the woman's lawyers, prosecutors said they turned up a recorded conversation between her and a man detained in an Arizona jail in which she said "words to the effect" that "this guy has a lot of money. I know what I am doing."

RETURN TO FRANCE

If criminal charges are dropped and Strauss-Kahn heads home to France, collecting damages from him might prove difficult.

While the United States and France do not have an extradition treaty, which would prevent Strauss-Kahn from being forcibly returned here for a criminal trial, the two countries have treaties that would probably ensure that he could be served with a civil complaint and a subpoena to testify, international law experts say.

If Strauss-Kahn chose not to appear, a New York court could enter a judgment against him. But collecting damages would likely require the cooperation of a French court.

Paul Cohen, an attorney who specializes in international law for Thompson & Knight in New York, called the chances of extracting money from Strauss-Kahn if he is back in France "extraordinarily low."

"It has nothing at all to do with the merits -- it's all to do with the geography and the jurisdictional issues that come with it," he said. "The French courts may not appreciate a civil complaint like this that is in effect a proxy for criminal prosecution."

(Editing by Sandra Maler)

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UK government turns against Murdoch BSkyB bid (AP)

By DANICA KIRKA and ROBERT BARR, Associated Press Danica Kirka And Robert Barr, Associated Press – 1?hr?19?mins?ago

LONDON – The British government on Tuesday joined in calls for Rupert Murdoch to shelve his ambition of taking full control of British Sky Broadcasting as a widening investigation of phone hacking and bribery at his newspapers fed the backlash against the powerful media mogul.

The decision followed a dramatic accusation by former Prime Minister Gordon Brown that Murdoch's U.K. newspapers employed criminals to obtain confidential information about his family and ordinary people, and as police officers came under sharp criticism for failing to turn up evidence of some of the most serious spying allegations.

Prime Minister David Cameron's office said the government would vote with the opposition Labour Party on Wednesday to support a motion calling on Murdoch and his News Corp. to withdraw the $12 billion bid for highly profitable satellite broadcaster BSkyB.

Labour leader Ed Miliband said the motion, which is not legally binding but is a powerful expression of sentiment, would be the simplest way to ensure that the bid isn't considered until the criminal investigations are complete.

"Ultimately, that is a decision for News Corp. but we would always expect people to take seriously what Parliament has said," said Cameron's official spokesman, Steve Field.

Cameron's decision marked a sharp breach in relations with News International, the U.K. branch of News Corp., which published the Sunday tabloid News of the World, the focus of two criminal investigations.

Since public outrage exploded last week when it was claimed that News of the World employees hacked the phone of Milly Dowler, a 13-year-old murder victim, Cameron has said he would have accepted the resignation of his friend Rebekah Brooks, the chief executive of News International. On Monday, he said Murdoch should focus on the hacking and bribery issues, not the takeover.

Cameron has been embarrassed by the arrest of former News of the World editor Andy Coulson, who from 2007 until January was the prime minister's communications director.

On Monday, Culture Secretary Jeremy Hunt reportedly was prepared to tell the House of Commons that the government could veto a bid only on grounds that the takeover would give New Corp. too large a share of the news market. But, that position collapsed when News Corp. withdrew promises to spin off Sky News as a separate company, and the government responded by ordering the Competition Commission to undertake a review expected to last the rest of the year or longer.

Brown's furious denunciation of the politically powerful News International papers came a day after it was revealed The Sun newspaper obtained confidential information in 2006 that Brown's infant son Fraser had cystic fibrosis — and that he was among those whose privacy was breached by Murdoch's papers.

They "really exploited people — I'm not talking so much about me here now, I'm talking about people who were at rock bottom," Brown told the BBC. Brown said he knew of no legitimate way The Sun could have found out about his son's illness, though the newspaper said it used legitimate means.

News International defended the story, issuing a statement which said that it was "able to assure the Brown family that we did not access the medical records of their son, nor did we commission anyone to do so."

The widening allegations of illegal eavesdropping of politicians, royalty and hundreds of ordinary people at Murdoch-owned newspapers also renewed anger at London's Metropolitan Police for dropping an earlier investigation into company practices.

At a tense House of Commons parliamentary committee hearing, one current and two former senior officials of London's Metropolitan Police said they regretted that an investigation of the News of the World in 2006 had not uncovered the extent of the alleged phone hacking.

They blamed the News of the World and News International for not cooperating and pleaded that the force was preoccupied with terrorism investigations.

Resources were stretched and there were not enough officers to fully staff 70 terrorist investigations running at the time, said Peter Clarke, former commander of the anti-terrorist branch.

The hacking case yielded convictions and prison sentences for a reporter and a private detective working for News of the World, but recent allegations suggest the practices were much more widespread at Murdoch's papers.

Documents gathered in the first investigation yielded 3,870 names, 5,000 landline numbers and 4,000 mobile numbers that may potentially have been hacked, Deputy Assistant Commissioner Sue Akers told the committee. So far, she said, police had contacted 170 potential targets of hacking.

The scandal has broadened, with among others accusations, the allegation that Murdoch reporters paid bodyguards of Queen Elizabeth II for sensitive phone numbers and travel plans.

BSkyB shares fell for the sixth straight day, closing down 3.3 percent at 692 pence ($11.03) on the London Stock Exchange. At the start of last week, they were at 850 pence.

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Writer files assault charge against Strauss-Kahn (AP)

By MICHAEL WEISSENSTEIN and PIERRE-ANTOINE SOUCHARD, Associated Press Michael Weissenstein And Pierre-antoine Souchard, Associated Press – 15?mins?ago

PARIS – A young French author formally accused former International Monetary Fund chief Dominique Strauss-Kahn of attempted rape and broke her long public silence Tuesday with a dramatic account of fending off an attacker who ripped at her clothes as they fought on his apartment floor.

Tristane Banon's criminal complaint was already spawning an ugly public battle that appeared to be dividing France and follows trans-Atlantic mudslinging over the Guinean chambermaid who accused Strauss-Kahn of forcing her to perform oral sex in his New York hotel room.

The sudden weakening of the maid's case because of New York prosecutors' doubts about her credibility revived hopes in Strauss-Kahn's Socialist Party that he could return to France and retake his position as the strongest potential challenger to conservative President Nicolas Sarkozy in the 2012 election.

Those hopes could be undermined by the 31-year-old writer's legal action, which is expected to set off a lengthy preliminary investigation by prosecutors into whether there is enough evidence to pursue a case in France.

While many here saw Strauss-Kahn, 62, as a victim of rough U.S. justice, the French public may recoil at a drawn-out case in French courts brought by a woman whose mother is a Socialist Party official. Polls already have found French voters evenly divided over whether they want Strauss-Kahn to return, with women more likely to object to his reviving a political career.

A poll of 860 people conducted over the weekend by the magazine Nouvel Observateur found that 54 percent didn't want Strauss-Kahn to run in the Socialist Party primary, and 63 percent didn't believe that he would end up running.

"He grabbed my hand, then my arm, I told him to let me go and that's when the fight started. He pulled me towards him, we fell down and fought on the ground for a few minutes," Banon told news magazine L'Express.

She said she started kicking him with her boots, then finally broke free, ran down the stairs and called her mother from her car.

"I couldn't even drive I was trembling so much," she said. The Associated Press does not name alleged victims of sexual crimes unless, like Banon, they choose to publicly identify themselves.

Strauss-Kahn allies took to the airwaves Tuesday to try to undermine Banon and question the timing of her complaint about an incident that she says took place in 2003, when she was trying to interview Strauss-Kahn for a book project. Banon first recounted the incident on a 2007 TV show in which Strauss-Kahn's name was edited out.

Her lawyer began discussing the possibility of bringing charges after Strauss-Kahn's May 14 arrest, but Banon still said very little.

"Tristane Banon has been telling her story for months and years. She's filing her complaint today," Socialist lawmaker Jean-Marie Le Guen told reporters. "In that, I see a certain opportunism that I associate with this mudslinging, these disinformation campaigns against Dominique Strauss-Kahn at the moment when American justice is about to acknowledge his innocence."

Strauss-Kahn's lawyers on Monday labeled Banon's account "imaginary" and said they would file a criminal complaint of slander against her.

Banon told French news magazine L'Express that she was tired of hearing "lies and rumors" told about the incident.

"I can't take it anymore hearing that I must be lying because I haven't filed suit," Banon said.

Strauss-Kahn is free on bail in New York, charged with attempted rape and other crimes. In a further twist to the saga, his New York accuser filed a libel suit Tuesday against the New York Post after it called her a prostitute.

Banon said she had waited eight years before filing her complaint because "it's very difficult for any woman in this situation ... and it's even more difficult when you know in advance that it's doomed to failure."

Banon says she described some of the attack in an "autobiographical novel" she published in 2006 called "The Trapeze Artist."

"I left out some sordid details, about his fingers in my mouth, his hands in my underwear after he ripped off my jeans and my bra," Banon said.

Lawyer David Koubbi said Banon had been dissuaded from filing charges after the incident by her mother, Anne Mansouret, a regional councilor in Strauss-Kahn's Socialist Party. Mansouret now says she regrets urging her daughter not to file a complaint but she feared that taking action against such a powerful figure would affect her daughter's career.

Mansouret told the French radio station RTL that her daughter "considers the only way to end this is in fact to file a complaint, to say that at least justice can be done."

"She's a young woman who's matured," Mansouret told RTL. "She took this decision, I suppose, after maturely reflecting."

Mansouret said she thought that by filing the complaint, it would help her daughter "rebuild herself."

"She tried to move ahead without doing that, and it wasn't possible. She arrived at a level of suffering. It's suffering to be permanently harassed by people who criticize how you've acted," Mansouret said.

If Banon's complaint leads to preliminary charges, there will then be a lengthier investigation, sometimes lasting years, to determine if the case should go to trial before a judge.

The same process would apply to the slander complaint against Banon.

A slander charge can be brought against anyone who French prosecutors believe deliberately filed a false complaint with authorities. In Banon's case, an investigation would begin only if her attempted rape complaint is found to be false. A slander charge carries a maximum term of five years in a prison and a 45,000-euro ($65,000) fine.

French prosecutors could decide not to pursue the case against Strauss-Kahn if they find evidence he engaged in forcible sexual contact that fell short of attempted rape. The statute of limitations on sexual assault charges in France is three years, while attempted rape charges can be filed for up to 10 years after the alleged crime.

Strauss-Kahn has relinquished his passport to New York authorities. His next court appearance is July 18.

___

Cecile Brisson and Greg Keller contributed.

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Obama warns against short-term deal on debt limit (AP)

WASHINGTON – President Barack Obama prodded Congress Tuesday to make a deal within the next two weeks on raising the nation's borrowing limit, and he said he was summoning leaders of both parties to the White House this week to try to get it done.

Obama said he opposed any effort to "kick the can down the road" with a short-term increase, as suggested by some lawmakers — though he stopped short of ruling that out. He reiterated his position that any deal must include not only spending cuts but also new revenue — tax increases already ruled out by Republicans.

"We need to come together over the next two weeks to reach a deal that reduces the deficit and upholds the full faith and credit of the United States government and the credit of the American people," Obama said at the White House.

"We've made progress, and I believe that greater progress is within sight, but I don't what to fool anybody — we still have to work through real differences," the president said.

He said congressional leaders were being invited to meet Thursday at the White House.

Obama spoke as the Aug. 2 deadline for raising the nation's borrowing limit came closer. Experts say lawmakers must waste no time in making a deal if they are to have any chance of getting it finalized and passed through both chambers of Congress in time.

Despite the president's optimism, it remained unclear where compromise could be found. Republicans are insisting they will note vote to raise the debt limit without major spending cuts; Democrats are refusing to sign off on cuts of such magnitude without at least some tax increases as well. Republicans say they won't sign off on any tax hikes at all, including those Obama wants targeting the wealthiest Americans or closing loopholes to corporations.

The administration says that if the government's borrowing limit is not increased by Aug. 2, the U.S. will face its first default ever, potentially throwing financial markets into turmoil.

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Six Syrians killed as 500,000 protest against Assad (AFP)

DAMASCUS (AFP) – Syrian security forces killed at least six demonstrators as more than half a million people took to the streets across the country on Friday to demand the departure of Bashar al-Assad, activists said.

The protests came as US Secretary of State Hillary Clinton said time was running out for the Syrian president, as he pursues a violent crackdown on pro-democracy activists that has killed more than 1,300 people since mid-March.

At least three people died in the central city of Homs when security forces opened fire, two were killed in Damascus and one in Daraya, near the capital, activist Ammar Qorabi told AFP in Nicosia.

Qorabi, who runs the National Organisation of Human Rights and is based in Egypt, said by telephone that a seventh person was killed on Friday in an unrelated drive-by grenade attack.

State television gave a conflicting toll, saying gunmen killed one demonstrator in Damascus and two people in Homs, one a policeman.

Waves of protesters flooded the streets nationwide to demand the fall of the regime, with varying reports putting the turnout in the central city of Hama alone at more than half a million.

The head of the Syrian Observatory for Human Rights, Rami Abdel Rahman, spoke of 500,000 protesters and said this was "the biggest demonstration since the Syrian Revolution broke out" on March 15.

Another activist said that "more than 400,000 marched," adding that "they came from all over, from mosques and nearby towns."

A third said more than 200,000 had gathered in the city's Assi Square, stretching for more than one kilometre, and that there was no sign of security forces.

Hama has a bloody past. In 1982, an estimated 20,000 people were killed when the army put down an Islamist revolt.

Demonstrations also gripped the protest hub of Homs where one activist said "more than 100,000 people" protested in several districts as tanks were deployed.

Abdel Karim Rihawi, president of the Syrian League for Human Rights, said "tens of thousands of protesters headed towards Deir Ezzor's Freedom Square upon leaving the mosques" after the weekly prayers in the eastern oil hub on the Euphrates River.

In Jabal al-Zawiyah, which has been the theatre of army operations since Tuesday, "tens of thousands of people started to march from the village towards Maaret al-Numan," he told AFP.

State television reported pro-regime demonstrations in the northern commercial hub of Aleppo and in Suweida, in the south, with people chanting "God, Syria, Bashar and that's it."

Overnight, Abdel Rahman said security forces killed three civilians in Jabal al-Zawiyah, and explosions were heard in the coastal city of Latakia.

Meanwhile Clinton criticised the Assad regime's incoherence in authorising an opposition meeting while stifling dissent.

"Allowing one meeting of the opposition in Damascus is not sufficient," she told reporters on a visit to Lithuania.

"I'm just hurt by recent reports of continuing violence on the border and in Aleppo, where demonstrators have been beaten, attacked with knives by government-organised groups and security forces," Clinton said.

"It is absolutely clear that the Syrian government is running out of time. There isn't any question about that."

Friday's protests followed a call from the Facebook group, The Syrian Revolution 2011 group, which called on people to rally, branding July 1 "the Friday of departure" and saying in a message to Assad: "We don't love you... Go away, you and your party."

Hundreds of protesters in Aleppo, Syria's commercial hub, were beaten back on Thursday by baton-wielding security forces, activists said.

On Thursday, the opposition announced the creation of a "national coordination committee" of exiled dissidents and opponents at home to push for democratic reforms.

The announcement came after about 160 dissidents, several of whom have spent years in jail, gathered Monday in Damascus, vowing to press ahead with a "peaceful uprising for freedom and democracy and pluralism to establish a democratic state through peaceful means."

The dissidents demanded the right to demonstrate peacefully, the release of political prisoners, freedom of the press, the safe return of refugees and moves to prevent foreign intervention.

The Observatory says 1,360 civilians have been killed since mid-March and that 343 security force personnel have also died. Thousands have been arrested.

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