Todays News: 2011

Saturday, December 31, 2011

Whistleblower documents illuminate case against BNY Mellon (Reuters)

NEW YORK (Reuters) – Confidential whistleblower documents that helped spark a massive state and federal investigation into how Bank of New York Mellon Corp charged pension funds for currency exchange, provide a rare window into how a bank insider aided a lawsuit against the bank.

The information provided by whistleblower Grant Wilson, who worked at BNY Mellon, included a detailed analysis of how the bank allegedly provided "fictitious" foreign-currency costs for pension funds.

The analysis included a step-by-step guide to how currencies were traded and internal profits generated by the bank, according to documents seen by Reuters. A memo detailing fellow employees also was provided.

Aided by Wilson's information, multiple states, including Virginia, Florida and New York, have sued BNY Mellon, alleging that the bank improperly charged state and local pension funds for foreign exchange. The Department of Justice also has sued the bank.

The allegations center on claims that BNY Mellon provided unfavorable currency-exchange rates for state and local pension funds for a decade. In a lawsuit in October, the New York attorney general alleged BNY Mellon earned $2 billion over the decade from the trading.

A bank spokesman said the bank believes that many comments detailed in the documents were taken out of context or not said at all.

"A handful of purported statements cherry-picked from millions of documents gathered over a decade do not reflect the way we do business or the value we provide our client," the spokesman said.

The documents illuminate why insiders with highly confidential information can be a potent force in whistleblower lawsuits. Much of the information a whistleblower provides remains confidential.

Wilson, for example, worked at the bank even as he secretly provided to his legal team -- lawyers in Boston and New York -- information about how BNY Mellon allegedly conducted foreign-exchange trading.

Wilson's information was provided to the legal team that filed whistleblower lawsuits against BNY Mellon in 2009 and then aided state attorneys general in subsequent probes. The legal team includes Boston lawyer Michael Lesser, and Philip Michael, a lawyer in New York, as well as Harry Markopolos, a fraud investigator best known for warning that Bernard Madoff was operating a fraudulent scheme.

Lesser, an attorney at Thornton & Naumes, said Wilson was not available for a comment.

The information then was provided by Wilson's lawyers to the Florida attorney general in 2009 and 2010. The attorney general at the time was weighing whether to intervene in an October 2009 whistleblower lawsuit against BNY Mellon. That lawsuit was based on Wilson's information.

In August this year, Florida Attorney General Pamela Jo Bondi filed her lawsuit in Leon County.

A bank spokesman said the Florida lawsuit is "without merit."

The Wall Street Journal earlier this year identified Wilson as the whistleblower behind the state and federal investigations and reported the existence of the documents.

Wilson, according to the documents, worked as a foreign-exchange trader for 19 years. He joined a predecessor bank to BNY Mellon in 1997 and left this spring. He worked at BNY Mellon's Pittsburgh office.

The documents detail Wilson's experience at the bank, noting that the trader "possesses deep and sophisticated knowledge and personal experience in these businesses, particularly with regard to foreign exchange." The documents note that he "never received a reprimand" during his career.

Wilson's first-hand knowledge was crucial to the state lawsuits. Information provided in 2009 underpinned subsequent state claims. Wilson "can describe, step-by-step, how the fraud is committed against the affected funds and how the various departments of the Bank work to make the process as profitable as possible," one document alleges.

Wilson and his lawyers, for example, provide 11 chronological steps to explain how pension clients allegedly receive a "falsified trade price," documents show. Those clients used a so-called "standing-instruction" program in which they effectively give control of foreign exchange to the bank.

In one document, Wilson's lawyers provide a question-and-answer tutorial so the Florida attorney general's office knows the right questions to ask BNY Mellon employees.

The documents also show how Wilson aided the legal effort even as he continued to work at BNY Mellon. One memo was written by Wilson's lawyers in August 2010, some eight months before Wilson left the bank. In the memo, Wilson's lawyers tell the Florida attorney general that Wilson knows that efforts to obtain documents from the bank are being stymied with "claims of difficulty in production or other delays."

The memo, using Wilson's knowledge of the bank, states that the information actually could be easily obtained because it is "centrally stored."

"It is stored at a state-of-the-art facility that should hasten, rather than hinder, any document response from the bank."

A month later, in September 2010, Wilson's lawyers submitted another memo to Florida's attorney general, noting: "We would also like to remind you that (Wilson) continues in his employment at the bank. Specific information, documents and conversations mentioned here could be connected" to Wilson.

That memo alleges that BNY Mellon "is now actively and hurriedly formulating a strategy" aimed at preserving profits from the foreign-exchange business at the center of the state inquiries. The memo explains that BNY Mellon publicly wants to provide a supposedly more "transparent" foreign-exchange system.

Actually, the "Project Gateway" strategy provides "no true change," the memo claims.

The memo also claims that one BNY Mellon client had received better pricing on currency transactions even as the bank continued "to steal" from other clients.

The documents also show some inside BNY Mellon allegedly worried about the impact of the investigations and whether profits would soon disappear. One employee, having learned that probes were looking at how BNY Mellon traded currencies, said: "It's over, it's all over," according to a March 2010 document.

Another document describes two months later how a senior banker addressed FX traders and told them the bank had received 16 subpoenas. This employee told the traders, "We have not done anything wrong."

In a seven-page memo, Wilson and his legal team provided detailed biographies of fellow traders and employees at BNY Mellon to help determine whether they might be helpful in the whistleblower legal effort. One employee was described as "worried about job security ... Not financially secure. Scared and probably loyal to the Bank. But also would not be inclined to perjure herself ... She has a lot of information."

Another senior executive "likes to rant and rave ... Mr. Wilson assumes he will want to defend the bank." A sales executive "seems willing to push the envelope when it comes to producing profits."

(Reporting by Carrick Mollenkamp; Editing by Michael Williams and Maureen Bavdek)

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Eurozone faces tough hurdles early in 2012 (AP)

FRANKFURT, Germany – After a turbulent 2011, the 17 countries that use the euro will be quickly confronted in the new year with major hurdles to solving their government debt crisis, just as the eurozone economy is expected to sink back into recession.

With government finances under pressure as growth wanes, the eurozone will find it even more difficult to shore up shaky banks and reduce the high borrowing costs that threaten Italy and Spain with financial ruin.

As early as the second full week of January, bond auctions in which Italy and Spain need to borrow big chunks of cash will start showing whether the eurozone is finally getting a grip on the 2-year-old crisis that has seen Greece, Ireland and Portugal bailed out.

If the auctions go well and borrowing costs ease, the crisis will ease, lending support for the EU strategy of getting governments to embark on often-savage austerity measures to reduce deficits, along with massive support for the banking system from the European Central Bank.

High rates, on the other hand, would feed fears of a government debt default that could cripple banks, sink the economy and, in the extreme case, destroy the 17-member currency union.

Key events early in the New Year:

• Italy and Spain will seek to borrow heavily in the first quarter at affordable interest costs, starting the second week in January.

• The slowing eurozone economy may slip into or already be in recession, lowering tax revenue and increasing government budget deficits.

• Bailed-out Greece must agree with creditors on a debt writedown that will cut the value of their holdings by 50 percent in an effort to start putting the bankrupt country back on its feet.

The task is for the major players — eurozone governments, the European Union's executive Commission and the European Central Bank — to convince financial markets that troubled governments can pay their heavy debts and therefore deserve to borrow at affordable interest costs.

Default fears have driven up bond market interest rates and made it more and more expensive for indebted governments to borrow to pay off maturing bonds. That vicious cycle forced Greece, Ireland and Portugal to seek bailout loans from the other eurozone governments and the International Monetary Fund.

A key stress point will be whether Italy can continue to raise money in the markets at affordable rates.

In the first quarter, it has to step up its borrowing to pay off euro72 billion ($94 billion) in bond redemptions and interest payments. Spain, which is expected to sell up to euro25 billion ($33 billion) in new debt, starts a heavy period of auctions on Jan. 12, and Italy begins on Jan. 13.

Overall, Italy has more than euro300 billion ($392 billion) in debt maturing in 2012.

"If Italy manages to auction this debt successfully, then the debt crisis will take a step back from the cliff edge," said analyst Jane Foley at Rabobank. "If it doesn't, it could go over the cliff edge. At the end of the day, whatever the nuances and hours of discussion that have gone on about the sovereign debt crisis, it boils down to whether a sovereign can sell its debt in the open market."

If Italy fails to borrow at affordable rates, the options are few and unattractive. The eurozone's euro500 billion ($653 billion) in bailout funds — already partly committed to earlier bailouts — would struggle to cover Italy's financing needs, even if additional help can be found from the IMF. A bigger solution — commonly guaranteed eurobonds — faces German resistance and would take time to implement.

The European Central Bank could use its power to buy large amounts of Italian and Spanish bonds with newly created money — but has so far refused, out of concern that a central bank bailout would remove the incentive for governments to control their spending.

Instead, the bank has focused on pushing credit to banks so they can keep lending to support the economy.

Still, its limited bond purchases have provided essential support to Spain and Italy by helping hold down borrowing costs. And its latest massive infusion of euro489 billion ($639 billion) in cheap, long term loans may help troubled governments borrow, as stronger banks may use some of the money to buy higher-yielding government bonds.

Italy pays an average of about 4.2 percent on its existing stock of euro1.9 trillion in debt, but the crisis has pushed bond yields on the country's benchmark ten-year bonds to over 7 percent.

Italy's new government, led by economist Mario Monti, can probably pay rates that high for a while, analysts think. Italy paid much higher interest rates in the 1990s for several years; rates peaked at 14 percent in 1992 but fell gradually to around 4 percent by 1998 as the country shaped up its finances to join the euro at the beginning of 1999.

Italy and Spain's battle will be even harder if the debt troubles pull the whole eurozone into a recession. Economists at Ernst & Young foresee a mild recession in the first part of the year and only 0.1 percent growth for the year as a whole, with unemployment at 10 percent for several years.

That will make it harder for governments to persuade voters to accept more cutbacks in spending, pensions and government wages while raising taxes.

It's not clear how long voters in Greece, which will have its fourth straight year of recession next year, will tolerate continuous austerity. Yet the cutbacks are the price of getting the bailout loans that have kept Greece from default.

Meanwhile Greece is striving to get creditors to agree to write down some debt and avoid larger losses in case of a default that is not agreed ahead of time. A euro14.4 billion ($18.8 billion) chunk of debt comes due in March.

Guntram Wolff, deputy director of the Bruegel think tank in Brussels, said that governments may get past the early hurdles — only to confront a souring mood among voters in the second half of the year over continuing cutbacks and sacrifices. New governments in Spain and Italy, currently enjoying political honeymoons, will be pressed to show progress. Greece, with a transitional government and elections expected in April, has seen repeated protests and strikes.

"There will be a point in the summer when people have seen a lot of action from government and no improvement in their living conditions and they will ask, do we have this euro to live with austerity and high unemployment," he said.

Wolff thinks that the determination of political elites to keep the euro together will win out: "I think it's going to survive."

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North Korea's new leaders lash out at South Korea and allies (Reuters)

SEOUL (Reuters) – North Korea sounded a bellicose note in its first communication with the outside world since the death of leader Kim Jong-il, saying its confrontational stance against South Korea would not change and labeling its opponents "foolish."

Since Kim Jong-il died on December 17, the outside world has been watching to see whether his son Kim Jong-un, aged in his 20s, would stick to its hardline "military first" policies that have seen the isolated nation move closer to nuclear weapons capacity.

"On this occasion, we solemnly declare with confidence that foolish politicians around the world, including the puppet forces in South Korea, should not expect any changes from us," a broadcaster on state television said on Friday.

She was reading a statement from the National Defense Commission, the top body in the militarized and impoverished state under Kim Jong-il.

In a break from the black mourning clothing worn since Kim Jong-il's death, the broadcaster wore dark red clothes and almost shouted her defiant message.

North Korea has a long history of using bellicose phrases against the South, especially since the conservative government of Lee Myung-bak took office in 2008 and ended a policy of engagement with the North.

It has threatened to turn the South's capital Seoul into a "sea of fire" on numerous occasions and repeated that rhetoric again on Friday.

"We will never engage with the Lee Myung-bak administration," said the announcer.

"The sea of bloody tears from our military and people will follow the puppet regime until the end. The tears will turn into a sea of revengeful fire that burns everything."

In 2010, the North launched an artillery barrage that killed South Korean civilians for the first time since the end of the Korean War in 1953. It was blamed for sinking a South Korean warship earlier that year, although it denies it did.

Little is known of Kim Jong-un, who had been groomed for government since 2009.

He has been dubbed "Supreme Commander" in North Korea and is expected to rule with the aid of key figures like his uncle Jang Song-thaek, at least in the early stages of the power transition.

"Expecting any change from the North on our part would be foolish," said Chung Young-tae, an analyst at the Korea Institute of National Unification in Seoul, a government think-tank.

South Korea's government did not formally respond to the comments from the North.

NUCLEAR CAPACITY

Under Kim Jong-il, who died earlier this month aged 69, North Korea conducted two nuclear tests and a top observer of its nuclear program said this week the country may only be a few years away from developing a nuclear tipped missile.

Few however expect the North to launch a full scale attack on South Korea. Pyongyang's main backer, China, has repeatedly urged a "peaceful" solution on the Korean peninsula.

Despite the freeze in official relations between North and South, the two sides held talks this year which North Korea leaked, embarrassing the government in Seoul.

North Korea needs food aid from the government in Seoul as up to a third of its population is malnourished, according to the United Nations.

"These forms of messages have led to conversation before," said Chung.

(Reporting by Seoul bureau; Editing by Raju Gopalakrishnan)

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Live Blog: Will Electronic Arts Go Pay-for-Play at E3?

By Jason Schreier
June 6, 2011 |
3:14 pm |
Categories: Console Games
Follow @jasonschreier

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BioWare began EA's press conference with a live demo of Mass Effect 3.

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Live blog starts at 12:30 p.m. Pacific, 3:30 p.m Eastern. Refresh this post for the latest updates.

LOS ANGELES — With Activision’s Call of Duty Elite already on the table, will rival Electronic Arts make a move to add a subscription service to its mega-popular sports games?

That’s the big question as Electronic Arts’ E3 2011 press conference kicks off here at the Orpheum Theater in downtown Los Angeles. The maker of Madden, FIFA and Tiger Woods said this morning at Microsoft’s press conference that the next versions of these games will integrate the Xbox 360’s Kinect motion controller. It also showed off how Kinect voice chat will work in its RPG Mass Effect 3. It will likely go a little bit deeper on both of these topics here at its own press conference.

Wired.com’s live blog coverage will begin at 12:30 p.m. Pacific.

12:27 p.m. We are here. There are bowls of miniature candy bars.

12:32 p.m. And we start off with some Mass Effect 3. Lead designer Casey Hudson is talking about the possibilities and choices. “This is all out galactic war.” We’re about to see a demo.

12:35 p.m. Demo of Mass Effect 3 looks sharp. Shepard aims at a target with his reticles, then calls in Joker and the Normandy to drop a payload. Shepard and an asari are fighting humanoid aliens of some sort and — oh wow, Shepard is commandeering a gigantic cannon. Sweet.

12:37 p.m. “That’s just a small taste of what we’re doing with the scale of the battles in Mass Effect 3.” Release date: March 6, 2012.

12:39 p.m. Gameplay trailer of Mass Effect 3 looks exactly like the demo we just saw. Looks like Shepard and crew will be shooting down aliens on Earth itself.

12:41 p.m. John Riccitiello is up on the stage, talking about the recently announced Origin service (EA’s new download store). Now we’re looking at Need for Speed: The Run, which will have on-foot sequences. Because clearly everyone plays racing games so they can walk places.

12:43 p.m. POV shots of a white car driving in Need for Speed: The Run. Another car hits it and your main character starts running into a building, then jumps off the roof. Camera transitions into slow-motion as you make big leaps. Lots of button-mashing, running and jumping. We now see why it’s called The Run.

12:45 p.m. Mission: Get out of the city. Looks like we’ve stolen a cop car. We’re blazing along at 130 miles per hour. This seems very unsafe.

12:47 p.m. Demo ends with the main character trying to get out of a car before a train runs over his face. This is done by mashing buttons, of course. More details and trailers will be available on Origin.

12:48 p.m. Bioware’s Greg Zeschuk is on stage talking upcoming massively multiplayer online roleplaying game Star Wars: The Old Republic. “I’m not trying to convince you to play it,” he says. “Just get lost in it and live in it.”

12:50 p.m. Trailer for The Old Republic. Lots of soldiers with Mass Effect-style armor. And suddenly we transition to a massive Jedi-on-Sith lightsaber battle. Millions of nerds everywhere are simultaneously squealing.

12:52 p.m. From Star Wars to snowboarding — now we’re looking at a trailer for SSX. An avalanche is hitting the slopes. Our two heroes just vaulted off a cliff and swung on a helicopter.

12:53 p.m. Three modes of gameplay: Race It, Trick It and Survive It. Will be out in January, 2012. You can see more characters/information on the Origin website. (I’m sensing a trend here.)

12:56 p.m. EA sports head Peter Moore is talking about FIFA 12. “The world’s sports game.” It will have tactical defending, precision dribbling and what’s called the “Player Impact Engine.” This will apparently feature realistic injuries and body movements. But can it make me care about soccer? (No.)

12:58 p.m. We’re hearing from international soccer players about how awesome they think FIFA is. And there’s NFL wide receiver Chad Ochocinco. And rapper Lil Wayne. And Drake. What?

12:59 p.m. Introducing the EA Sports Football Club. Is this FIFA’s version of Activision’s online Call of Duty Elite platform? Talking about how Football Club will let people compare and compete around the world on multiple platforms, including Facebook, PC and mobile phones.

1:00 p.m. I don’t know why they’re calling it the Football Club. This is soccer. SOCCER.

1:01 p.m. We can see more on Origin. (Of course.) No word on whether Football Club will cost any sort of extra fee.

1:03 p.m. Madden time! We’re hearing from the Broadway version of legendary NFL coach Vince Lombardi as he gives a passionate speech alongside footage from what I assume is Madden 12.

1:05 p.m. NFL players Ray Lewis, Peyton Hillis and Clay Matthews are here. Matthews is holding his Super Bowl trophy. He’s probably just trying to make the other two jealous.

1:07 p.m. Peter Moore looks very uncomfortable next to the three players. He’s talking about Madden 12, out August 30. Are these guys allowed to be in their uniforms? Doesn’t this violate some term of the NFL lockout?

1:10 p.m. Riccitiello is back to announce The Sims Social, a Facebook version of The Sims. The trailer shows a conversation about between two women. As one woman talks about the things she did on her date last night, we see them happening in The Sims Social. It ends with a steamy shower scene.

1:12 p.m. Curt Schilling is here to talk about upcoming action-RPG Kingdoms of Amalur: Reckoning. The art direction in this game is gorgeous. We see quite a bit of combat — swords, magic, two-headed ogres. Lots of gore-filled hacking and slashing. Coming next year.

1:14 p.m. Ratchet & Clank creator Insomniac Games is talking about its next project, OverStrike. Seems to be some sort of spy game.

Jason Schreier is a contributor to Game|Life and an NYC-based writer/editor. But he really just wants to be your friend.
Follow @jasonschreier and @GameLife on Twitter.

Tags: E3 2011, Electronic Arts

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Apple's iCloud: Data in Forefront, Devices in Background

By John C Abell
June 6, 2011 |
6:23 pm |
Categories: The Cloud
Follow @johncabell

The long, strange trip that has been Apple’s implementation of cloud computing seems to have finally hit the road Monday with a full-throttled embrace of a paradigm one might not expect from a hardware manufacturer: Your computing life is merely enabled by the devices you own, and should not be defined by them.

The unveiling of iCloud was telegraphed last week, and there were few surprises at the 2011 WorldWide Developers Conference. Cloud computing really just means one thing, and it’s a just a matter of how well you do it. The bottom line is that this is long overdue and utterly essential for the multidevice lifestyle that Apple has done so much to bring about.

It remains to be seen if Apple can deliver. But not trying to solve, in one fell swoop, the growing problem inherent in a distributed digital life might have been a drag on Apple’s core business. A massive mainstream is now the target audience for the mobile internet gadgets upon which Apple has staked its future. A perception that these things are complicated or don’t play nice with each other is toxic.

To be sure, iCloud doesn’t invent a single thing — except a new price point of zero (almost, more on that later) instead of the $100 a year for Apple’s current iteration of cloud storage called MobileMe. Music lovers will be disappointed: iCloud isn’t a repository to stream your music, and doesn’t one-up Music Beta by Google, Amazon Cloud Drive by much. And ? no real surprise here ? it’s only for Apple devices.

But Apple has lots of customers who now own maybe an iPhone and and iPad and a MacBook and have no patience for making any effort to make sure they’re all on the same page. The machine is starting to take a back seat now, by being a dreadfully easy to operate portal that makes your stuff available here and now.

And this is where Apple has the upper hand, why their cloud strategy could be a game changer: Like a tyrannical state, Apple can make decisions unilaterally, and impose them — no pesky cooperation from uneasy partner necessary, no buy-in from competitors, no dependencies.

You may not like the way Apple solves problems or — as in the case of the iCloud — believe that it’s about freaking time. But the sheer scale of this means that, if it’s as good as Apple says it will be, iCloud will refine how we think of computers and spur innovation from competitors in the still-vastly-larger Windows world.

For some the big question was how this would simplify iTunes, which essentially ties your music collection to a single computer. No more: Now your collection lives on a server farm and is available to any of your registered devices ? though not, sadly, as streaming files. And there’s a catch. For that $0 Apple will keep the music you bought from them safe and available to up to 10 devices (up from five). But it won’t do so for the music you didn’t buy from them — that’ll cost you $25 a year. The big innovation with the “matching” enhancement is that you won’t have to upload our collection, which nearly drove my colleague Dave Kravets nuts when he tried out Amazon Cloud Drive. Apple will just plop a another copy on the cloud.

Of course $25 isn’t a lot. But it’s a pretty significant asterisk on the “free” spin Apple will tout. Just about everybody’s collection includes non-iTunes music, so this means that Apple will get $25 from just about everybody who doesn’t want to get into a potentially nightmarish housekeeping problem that cloud computing is supposed to erase.

But, big picture: Apple’s cloud services have been a mess, and overpriced. I’ve subscribed to MobileMe for years, including the $150 family plan for our posse’s three iPhones, three Apple computers and one iPad. And I barely use it: I go to Google for e-mail and calendars, and use DropBox to share files among devices. Now, for 1/6th what people like me have been paying, they will get what sounds like effortless, seamless syncing in the background, and a huge digital hub in the sky.

That is, assuming iCloud isn’t more of the same in the problems department.

“You might ask, why should we believe them, they?re the ones that brought us MobileMe,” Apple CEO Steve Jobs knows the stakes told the WWDC audience. “We learned a lot.”

Missing Maine Toddler's Granddad 'Begging' for Return

PORTLAND, Maine ? �A day after police declared a 20-month-old girl's disappearance a crime, her grandfather pleaded Saturday for her return, urging anyone with information to come forward.

"We're all out here begging and pleading for the return of our baby girl, safe and sound. Call the state police," Ronald Reynolds, grandfather of Ayla Reynolds, said outside his home.

"What did they do to my little girl? What did they do to Ayla? What did they do to a helpless defenseless child?" asked Reynolds, who wore a green ribbon, the symbol for missing children.

"Every day I get up and wait and wonder. Yesterday I kept looking out the window, waiting for someone to come by and tell me something."

Saturday marked two weeks since Ayla's father reported her missing from his home in Waterville, 75 miles north of Portland. Justin DiPietro told police he saw her the night before when he put her to bed. He said she was missing from her bed on the morning of Dec. 17.

A massive search began, with wardens and volunteers combing through the woods and neighborhoods and searching streams. Police and FBI agents went door to door.

A $30,000 reward, the largest in state history for a missing person case, has been offered for information leading authorities to the child.

On Friday, Massachusetts state police brought special equipment to DePietro's home, and crime scene technicians were seen taking measurements. Investigators concluded that a crime had taken place and the State Police Major Crimes Unit took over the investigation, Waterville Police Chief Joseph Massey said. State police reported no new developments Saturday.

Of the 500 tips submitted to investigators, Waterville police say 75 have been from psychics. Deputy Waterville Police Chief Charles Rumsey told the Central Maine Morning Sentinel of Waterville that each tip, no matter who it's from, is assigned to an investigator.

Ayla was placed in her father's care while her mother, Trista Reynolds, was in a substance abuse rehabilitation program, which she completed. Ronald Reynolds said he was proud of his daughter for seeking help.�

"I know what my daughter did. She did the right thing," Reynolds said.

During Ayla's stay with her father, she broke her arm in what police described as an accident.

The Reynolds family said they were concerned about Ayla's care, and they've also criticized DiPietro for not pleading publicly for his daughter's safe return.

DiPietro, who has issued a statement denying he had anything to do with her disappearance, couldn't be reached for comment Saturday.

Reynolds said the family is trying to maintain hope that Ayla is safe and will be found. He said he wakes up every morning and kisses a photo of Ayla, praying that she's OK.

Reynolds said he sometimes spends his day looking out the window, hoping someone will drop by with new information, something positive for the family to latch onto.

"Someone took her. Somebody took her out the home. Who is what's I'd like to know," he said.

"I beg of these people: Bring her home safe. Bring her home safe and sound."

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