Hearing set on regulations for ride-sharing companies

BOSTON — Fans and critics of popular ride-sharing companies like Uber and Lyft will get a chance to weigh in on proposed regulations that could govern how the firms operate in Massachusetts.

Gov. Deval Patrick wants to give the state Department of Public Utilities the power to regulate the activity.

The hearing is scheduled for Wednesday morning at the state transportation building in Boston before the Department of Transportation and Registry of Motor Vehicles.

The proposed regulations would require the companies to obtain certificates to operate, conduct criminal background checks on drivers and have liability insurance.

A union representing cab drivers have argued that the changes would do little to help the taxi industry, which claims the ride-sharing firms operate illegally.

Uber-Boston has issued a statement in support of the proposal.

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US mission in Havana to become embassy amid thaw

HAVANA — A half-century after Washington severed relations with Cuba, the United States' seven-story mission looms over Havana's seaside Malecon boulevard as the largest diplomatic outpost in the country.

Cuban guards stand at close intervals on the street outside, and islanders line up by the thousands each year for a shot at a coveted visa.

The gleaming U.S. Interests Section suddenly is poised to become an even more important presence in Cuba as the two countries negotiate the first phase of their historic detente — transforming the complex into a full embassy that would reflect the Obama administration's hopes of new influence on the communist island.

Roberta Jacobson, assistant U.S. secretary of state for Western Hemisphere affairs, will be the highest known U.S. administration official to visit in decades when she comes next month for annual talks on migration that will now also focus on the details of re-establishing full diplomatic relations.

The discussions are expected to cover expanding staffing in the two countries' interests sections and letting diplomats travel outside their respective capitals without having to ask permission.

Also part of the reopening of the embassy: symbolic measures such as raising the American flag on the Malecon.

"Opening an embassy is a symbolic gesture, but symbols are really important," John Caulfield, who was Interests Section chief from 2011 to 2014, said by phone from Jacksonville, Florida, where he retired.

"This is a pretty powerful symbol by our president that we want to have a more normal relationship with Cuba despite the fact that we have the obvious differences," he added.

Cuba's interests section is a stately manor in Washington's Adams Morgan neighborhood. It, too, stands to become an embassy.

Diplomats say privately that Washington hopes to boost staffing in Havana, currently at about 50 Americans and 300 Cuban workers, as more American travelers and trade delegates are expected to come here under new rules to be set by the White House softening the U.S. trade embargo on Cuba.

An agreement could also ease or scrap rules that require U.S. diplomats to channel all requests through Cuba's Foreign Ministry; the diplomats would be able to deal directly with at least some other branches of government.

The U.S. Interests Section has often been a flashpoint for conflict, and its decades of hybrid status reflect the dysfunctional relationship between the two deeply intertwined countries.

The building first opened as an embassy in 1953, the same year Fidel Castro launched an ill-fated assault on a barracks that is considered the onset of the Cuban Revolution.

Eight years later, with Castro then in power, the countries broke ties and Switzerland stepped in to safeguard both the embassy and the ambassador's residence, a sprawling, immaculately groomed estate in Havana's finest neighborhood.

After the break, Washington was without a presence in Cuba until 1977, when the interests sections were opened under President Jimmy Carter. The missions technically operate under the aegis of the "protecting power" Switzerland.

Cuba later built the adjacent "Anti-Imperialist Plaza," which has hosted nationalist rallies where Castro gave long speeches railing against Washington, and concerts demanding the return of the Cuban intelligence agents whom the U.S. freed last week as part of the detente. Huge marches streamed past the Interests Section in 2000 to demand the return of the young Cuban rafter Elian Gonzalez.

On the wall of a conference room in the mission hangs the bronze head of an eagle that topped the nearby USS Maine monument until it was ripped down in a 1961 anti-Yankee protest following the failed Bay of Pigs invasion. The wings and body sit in a musty Cuban museum storage room awaiting a possible reunion with the head on the day that Havana and Washington become friends.

In 2006, U.S. diplomats installed an electronic billboard that scrolled messages extolling democracy and human rights to Cubans on the street below. An outraged Cuban government erected dozens of black flags to obscure the signs.

"The consequence of that was, for years, they did not allow us to import lightbulbs," Caulfield recalled with a chuckle.

The U.S. Interests Section is closely watched by cameras and guards on both sides, a function of both the longtime tensions and general increased security at American diplomatic missions following 9/11. Cuban police make pedestrians cross the street to use another sidewalk, and no parking is allowed.

Some neighbors say they love living nearby: Nobody ever gets robbed, and the employees and visa-seekers support local private businesses that were allowed to open under President Raul Castro's economic reforms of recent years.

"Because the whole area is so well guarded, it's very safe," said Pedro Hernandez, 73, who runs a modest snack bar out of his home. "There are no problems with crime of any kind, and that's very good for us."

American diplomats say low-level harassment was routine for many years, as Cuba restricted their movements and activities and dragged its feet on permission to do standard maintenance. Cuban state media routinely portrayed the building as a den of spies.

Both sides gradually moved toward a remarkably civil relationship in recent years. The electronic sign came down in 2009, as did the black flags — though they still fly on special occasions. The countries started granting diplomatic travel permission more easily. Envoys exchanged home phone numbers and even dined together occasionally. Long-stalled talks on migration and restoring mail service resumed.

Once details of the new diplomatic relationship are worked out, actually turning the mission into an embassy requires little more than changing a few signs and ordering a new letterhead, experts said.

"A few strokes of the pen and that's it," said Wayne Smith, who was a junior diplomat in Cuba when relations were severed in 1961 and returned to head the Interests Section in the late 1970s.

Some who served in the U.S. Interests Section are awaiting the change with a mixture of excitement and wistfulness at not being here for the transition.

"I would have loved to be there to raise that flag," Caulfield said.

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Associated Press writers Anne-Marie Garcia and Michael Weissenstein in Havana contributed.

___

Peter Orsi on Twitter: www.twitter.com/Peter_Orsi

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Hospital closes, leaves emergency room open

QUINCY — An emergency room is all that remains of a 124-year-old hospital in Quincy.

After reaching an agreement with state regulators, Quincy Medical Center officially closed its doors at midnight, replaced on Saturday by the 24-hour satellite emergency care facility that will continue operations until at least the end of 2015.

The hospital's owner, Steward Health Care, said it was losing $20 million a year in the face of increased regional competition.

Quincy Medical Center announced in November that it planned to close, and state officials waived a required 90-day notice that would have forced Steward to keep it open until February.

The hospital said it had no inpatients remaining at the time of closing.

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Can Mass. casinos compete?

The state's gaming czar says local casinos are ready to weather mounting competitive pressures in New York and Connecticut in 2015, as his commission gears up to regulate its first gambling facility in Plainville and grapples with uncertainty over whether there will be a third Bay State casino in Southeastern Massachusetts.

Gaming Commission chairman Stephen Crosby said developments such as New York approving three new upstate casinos on Dec. 17 — including one in Schenectady, 90 minutes from the MGM Springfield project — have been "part of the calculation from the beginning."

"The Springfield facility is going to take a backseat to nobody," Crosby said. "I think we are going to have by far the most compelling, most competitively well-positioned facilities out there."

But Michael Paladino, who assesses the credit worthiness of casino companies for Fitch Ratings, said the types of casinos New York has opened, and the commercial one rumored on Connecticut's Bay State border, generally eat away at the existing local customer base, not add to it.

"We do think the market in the Northeast is saturated, particularly with the competition coming online in New York and Massachusetts," Paladino said. "It means that, generally, new competition has limited ability to grow the market, and essentially cannibalizes existing properties to a great degree."

MGM, which this year was licensed to build an $800 million casino in downtown Springfield, isn't worried.

"We are confident that as an urban revitalization project our innovative design, tested marketing plan, and strong brand will make MGM Springfield a premiere destination resort casino in the Northeast," MGM spokeswoman Carole Brennan said. "We are moving full steam ahead for a spring 2015 groundbreaking."

Boston College professor Richard McGowan, a casino expert, expects to see Massachusetts projects cut back as New York facilities come online, and for the Mohegan Sun and Foxwoods casinos to adjust to hold on to market share.

"In the long run ... you're going to see a repeat of Atlantic City, eventually," McGowan said, referring to the widespread shuttering of casinos this year. "There's going to be too many."

The first facility to open will be the $225 million Penn National slots parlor at the Plainridge Race Course in Plainville, expected in June. Crosby said the commission will add 10 to 15 staff members to regulate the Penn facility, which he called the gaming panel's "real focus" in 2015.

Meanwhile, there is a dearth of developments for the "Region C" resort casino license in the southeastern part of the state, with a Jan. 9 deadline for interested parties to submit a list of principals for background checks.

KG Urban has been approved to pursue a license in Region C, but has yet to announce an operator or win the support of New Bedford Mayor Jon Mitchell, who is shopping the municipal golf course and a waterfront industrial site to casino operators.

"The market here in the Southeast is clearly weaker than it is in the other two regions," Mitchell said. "We're not holding our breath, but we're also open for a good proposal still."

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Market Basket ends 4 percent discount

BOSTON — The 4 percent discount that Market Basket shoppers enjoyed on most purchases for the past year is coming to an end.

The New England supermarket chain introduced the discount in January in response to high energy costs and cutbacks in the federal Supplemental Nutrition Assistance Program.

Company officials tell The Boston Globe the plan was always to phase out the discount, which ends on Saturday.

A family feud over the company's future led to a worker revolt and customer boycotts last summer. It ended with Arthur T. Demoulas gaining control from his cousin, Arthur S. Demoulas.

While some customers hoped the discount would continue, others say Market Basket still offers lower prices than many competitors.

The company operates more than 70 stores in Massachusetts, New Hampshire and Maine.

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Mass. skiing awaits cold

Massachusetts ski areas are awaiting this week's forecasted return of colder weather to make more snow and kick the season up a notch.

Wachusett Mountain Ski Area in Princeton, which opened Nov. 21, had one of its strongest and earliest launches in years for a record month.

"As the result of cold early temperatures, we were able to make snow early, and then we got the bonus of a 10-inch snowstorm around Thanksgiving," marketing director Tom Meyers said. "So we've had one of the best Novembers we've ever had."

But December has been a different story.

"December has been challenging all month, not just the last few days," Meyers said. "We've made snow whenever we can, but it's been not as cold as it was early. But, nevertheless, we still have over three-quarters of the mountain open, and the forecast now calls for cold temperatures to return … and we're looking to start making snow again and building base depths, expanding coverage and opening additional terrain."

Wachusett had 14 trails and four lifts open yesterday, with snow base depths of eight inches to 12 inches.

Jiminy Peak Mountain Resort in Hancock opened Nov. 16 with expanded snow-making operations. Yesterday, 34 trails and nine lifts were in operation with average snow base depths of eight inches to 28inches. 

"The season started out very solid and … we were able to get all our snow-making terrain open before Christmas," CEO Tyler Fairbank said. "We've never been able to do that before."

Rain on Christmas Eve and into Christmas knocked down Jiminy Peak's trail count a bit, but with a significant amount of manmade snow on the mountain, it was able to recover very quickly with its grooming fleet, according to Fairbank.

It's been a slow start at Nashoba Valley Ski Area in Westford, where eight of 18 trails and eight of 11 lifts were open yesterday.

The recent warmer weather has proved a challenge, according to marketing and corporate sales director Pam Fletcher. This time last year, Nashoba Valley had its entire mountain open thanks to a series of December snowstorms and more days of super cold temperatures.

"But with the cold weather coming, we can cover and open a slope from bare ground," Fletcher said. "And we already had, going into the rain, decent coverage — anywhere from 2 feet in some areas to 2 inches. That depth really helps you when you're going into the warm weather that we got over the holiday. We just need a couple of cold nights, and they can cover the whole thing."

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Short-sellers get last-minute gift with debt relief extension

WASHINGTON — For David Foster of Chicago, it was a stunning and welcome early Christmas present for him, his wife and three young children.

The Senate's 11th-hour extension of the Mortgage Forgiveness Debt Relief Act through Dec. 31 will save Foster, who works for a nonprofit ministry group, from having to pay the IRS about $28,000 next year on $100,000 of mortgage debt canceled by his bank as part of a short sale on his condo. Before the Senate's action, he told me he had no idea "how or where we could come up with" that sort of money.

The federal tax code treats forgiven debt as ordinary income to the borrower, taxable at regular rates. But under an exception that took effect in 2007, qualified home mortgage debt that is canceled by a lender as part of a short sale, loan modification or foreclosure is treated as non-taxable. However, that exception expired last Dec. 31 and its renewal has been in doubt all year leaving short-sellers such as Foster unsure whether they would be facing crushing taxes in 2015.

Thousands of Americans who completed short sales during 2014 and received cancellations of mortgage debt by banks had reason to celebrate when the Senate extended the exception for transactions just before adjourning for the holidays. According to data prepared for this column by research firm RealtyTrac, nearly 122,000 short sales went to closing nationwide between January and October, involving an estimated average debt forgiveness of about $88,500. The average seller had a mortgage balance one and a half times higher than the market value of the house.

In a short sale, an underwater homeowner agrees to sell the property to a new purchaser, typically for a price well below what is owed to the bank. If the bank agrees to the sale, the proceeds pay off part of the loan balance and the bank forgives, or writes off, the rest.

Richard Eastern, CEO of Washington Property Solutions Inc. in Bellevue, Wash., a brokerage specializing in short sales, says people such as Foster are the lucky ones. Substantial numbers of owners have been rushing to beat the Dec. 31 deadline. "I got a call today from a client who asked, 'we're still scheduled for Dec. 29, right?' " Eastern recounted. The typical client served by his firm is an underwater owner with $300,000 of mortgage debt on a $200,000 house.

But Eastern said he has dozens of other listings where a 2014 closing won't be possible, and some of these clients "are now devastated" in the wake of the Senate's limitation of the extension to 2014 transactions only. They could be plunging into a federal tax policy black hole when they complete their sales next year, uncertain of any further extension of the debt forgiveness law.

Eastern is mystified that Congress could not have lengthened the extension to two years, retroactive for 2014 and good through Dec. 31, 2015, a provision approved in a bipartisan vote by the Senate Finance Committee last summer. He predicts that without protection from heavy tax burdens, many underwater owners will opt instead for bankruptcy filings. In some cases, they might be able to qualify for an "insolvency" declaration, which could wipe away tax liability for unpaid mortgage balances.

How do you know whether your short sale, loan modification or foreclosure is covered by the extension for 2014? Though a tax professional familiar with the law should be your best guide, here are the key tests you'll need to pass: The house securing the mortgage debt must be your principal residence. The maximum amount of debt that qualifies for relief is $2 million ($1 million if you are married filing taxes separately.) Any portion of the mortgage debt forgiven that was used for purposes other than improving or building the house — say you refinanced, pulled cash out and used it to buy a car — will not qualify for the exclusion and may be taxable.

What are the prospects that Congress will extend the law for 2015, covering people who didn't quite make the deadline for 2014? Not great. The Republican tax policy leadership in the House favors broad tax reforms in the upcoming session and wants to put an end to temporary tax code benefits that require periodic extensions.

Unless proponents can make a strong case for mortgage debt relief as a permanent part of the tax code, it will be tough to get it extended again.

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Farmers brace for labor shortage under new policy

FRESNO, Calif. — Farmers already scrambling to find workers in California — the nation's leading grower of fruits, vegetables and nuts — fear an even greater labor shortage under President Barack Obama's executive action to block some 5 million people from deportation.

Thousands of the state's farmworkers, who make up a significant portion of those who will benefit, may choose to leave the uncertainty of their seasonal jobs for steady, year-around work building homes, cooking in restaurants and cleaning hotel rooms.

"This action isn't going to bring new workers to agriculture," said Jason Resnick, vice president and general counsel of the powerful trade association Western Growers. "It's possible that because of this action, agriculture will lose workers without any mechanism to bring in new workers."

Although details of the president's immigration policy have yet to be worked out, Resnick said the agricultural workforce has been declining for a decade. Today, the association estimates there is a 15 to 20 percent shortage of farmworkers, which is driving the industry to call for substantial immigration reform from Congress, such as a sound guest worker program.

"Hopefully there will be the opportunity for comprehensive immigration reform," said Karen Ross, secretary of the California Department of Food and Agriculture. "That's the right thing to do for this country."

California's 330,000 farmworkers account for the largest share of the 2.1 million nationwide, according to the U.S. Bureau of Labor Statistics. Texas comes in a distant second with less than half of California's farmworkers.

Once Obama's executive action starts going into effect next year, it will protect the parents of legal U.S. residents from deportation and expand a 2012 program that shields from deportation people brought into the U.S. illegally as children.

Manuel Cunha, president of the Fresno-based Nisei Farmers League, estimates that 85 percent of California's agricultural workers are using false documents to obtain work.

Cunha, who has advised the Obama administration on immigration policy, figures that 50,000 of the state's farmworkers who may benefit from the president's executive action could leave the fields and packing houses in California's $46.4 billion agricultural industry.

"How do I replace that?" he said. "I think we're going to have a problem."

Many farmworkers are paid above minimum wage, earning more hourly than they will in other industries, but he said that workers that leave will gain year-around jobs and regular paychecks, rather than seasonal employment.

While farmers may face a setback, Obama's order is good for workers, who support families and fear that any day they may be pulled over driving to work and deported, said Armando Elenes, national vice president of the United Farm Workers.

With proper documentation, workers will feel empowered and be more valuable, Elenes said. Confronted with abuse at work — such as being paid less than minimum wage or denied overtime — workers will be able to challenge their employer or leave, he said.

In addition, their newfound mobility will create competition for farmworkers and potentially increase wages, Elenes said, adding, "It's going to open up a whole new world for workers. A lot of times, if you're undocumented, you feel like you're stuck."

Ed Kissam, an immigration researcher at the immigrant advocacy group, WKF Giving Fund, said he doubts a significant number of farmworkers will leave the industry. Farmworkers often lack the language, education and technical skills to move up the employment ladder, he said. "Surely some will," Kissam said. "It's not going to be a mass exodus."

Edward Taylor, a researcher at the University of California, Davis, said a shortage of farmworkers could be exacerbated by a dwindling flow of workers from Mexico, the largest supplier of labor to the United States. Taylor said the lower birthrates, more industrial jobs and better schools in rural Mexico are cutting into the supply of farmworkers.

"U.S. and Mexican farmers have to compete for that diminishing supply of farm labor," he said. "Once this change hits, there's no going back."

Central Valley farmer Harold McClarty of HMC Farms, who hires a thousand workers at harvest time, said there is no replacing the human hand for picking the 50 varieties of peaches he grows. His workers pick a single tree five or more times, making sure the fruit they take is ripe.

"We haven't found any machines that can do anything like that," he said. "You can't just pick the whole tree."

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SpaceX plans lots of launches, and then a Mars mission

Once the launchpad for Apollo and space shuttle flights, NASA's Launch Complex 39A is now in the hands of SpaceX and its enigmatic billionaire leader, Elon Musk.

With a 20-year lease, the privately held Hawthorne, Calif.,-based company is rebuilding the launch complex at Kennedy Space Center to fit its rockets — the Falcon 9 and the soon-to-debut Falcon Heavy super-rocket — just as it envisions reshaping the space-launch industry.

The overhaul of 39A is the Central Florida centerpiece of SpaceX's plans. The company also has two other leased launchpads, Launch Complex 40 nearby at Cape Canaveral Air Force Station, and one at Vandenberg Air Force Base, Calif. It plans to build a fourth pad near Brownsville, Texas.

Its short-range goal is to pursue private and military launch contracts. Eventually, SpaceX hopes to colonize Mars.

Next up will be the company's fifth NASA-contracted mission to haul equipment and supplies to the International Space Station.

The launch of SpaceX's Dragon resupply capsule, postponed three times, now is scheduled for a Jan. 6 liftoff from Launch Complex 40.

Starting in 2018, SpaceX is one of two private rocket companies with contracts to ferry astronauts to the space station.

"Elon wants to rule the world," said John Logsdon, professor emeritus at George Washington University's Space Policy Institute. "The company has a long-term strategy to become a, or maybe the, dominant player in space activity."

SpaceX's longer-term plans are not dependent on NASA, but on spurring a worldwide increase in private space launches, Logsdon said.

And with all the company is investing now, it is gambling on an extremely robust private-space business in the 2020s, said George Abbey, a former director of NASA's Johnson Space Center and now a senior fellow of space policy at the Rice University Baker Institute for Public Policy.

The company "has got to be successful in capturing the launch-vehicle market," Abbey said of SpaceX. The company would not grant an interview.

Industry advocates such as Eric Stallmer, president of the Commercial Spaceflight Federation trade group, think there will be a lot of space-launch business in the next decade.

Stallmer said launches are by far the biggest cost of putting a private satellite into service. So as competition and innovation drive down launch costs and increase reliability, the market should increase "exponentially" from the 30 commercial launches a year now seen worldwide, he said.

"They (SpaceX) keep challenging themselves and the industry, and they keep succeeding, and it's really changing the way we do business in space," he said.

In interviews, Musk often has talked of his dream of sending astronauts to Mars. SpaceX already is pursuing some Mars-landing technologies. Musk has said he could reach Mars by 2030 — ahead of NASA's plans to do so — and envisions creating a colony there.

The commercial space industry is full of ambitious new companies, including others like SpaceX, run by charismatic billionaires. They must compete with established companies such as Boeing and Lockheed Martin, the European cooperative Arianespace, Russia's Soyuz and others that have strong relationships with governments and satellite companies.

Two, Orbital Sciences and Virgin Galactic, had disastrous setbacks this fall. Orbital's rocket and capsule blew up on liftoff in Virginia, on a space station resupply mission in October. Three days later, Virgin's SpaceShipTwo crashed during a test, killing a pilot.

SpaceX has successfully launched its Falcon 9 rocket 13 times.

During the next several years, SpaceX has contracts for 40 more rockets, include five for launching the Falcon Heavy.

All five of the big rockets and 23 of the others are scheduled to launch from Florida.

That could change once SpaceX finishes its private launch complex near Brownsville, said Roger Handberg, who specializes in space policy at University of Central Florida.

In Florida, SpaceX can launch only on dates approved by the Air Force, but in Texas the company has freedom to launch on its own schedule. He expects the company's private payloads to be launched mostly in Texas.

SpaceX nearly went bankrupt before it started winning NASA contracts, Handberg said. And the company's deals with NASA to service the space station likely will last only through 2025, when the station is scheduled to be decommissioned.

Though SpaceX has won some U.S. military launches, most remain committed to old-guard contractors such as the United Launch Alliance, a partnership of Boeing and Lockheed Martin.

This year, the U.S. Department of Defense awarded to ULA a long-term, no-bid contract extension for 36 military launches. Musk blasted the deal in congressional testimony, and then SpaceX sued the federal government. That suit is pending.

UCF's Handberg said it's unclear whether there will be enough private rocket-launch business for SpaceX, as other companies emerge and older ones dig in.

———

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Congress likely to make key decisions on drones

WASHINGTON — The Obama administration is on the verge of proposing long-awaited rules for commercial drone operations in U.S. skies, but key decisions on how much access to grant drones are likely to come from Congress next year.

Federal Aviation Administration officials have said they want to release proposed rules before the end of this month, but other government and industry officials say they are likely to be delayed until January. Meanwhile, except for a small number of companies that have received FAA exemptions, a ban on commercial drone flights remains in place. Even after rules are proposed, it is likely to be two or three years before regulations become final.

That's too long to wait, say drone industry officials. Every year the ban remains in place, the United States loses more than $10 billion in potential economic benefits that drones could provide, according to the Association for Unmanned Vehicle Systems International, a trade group.

"We need some sort of process that allows some of the low-risk operations," said Jesse Kallman, the head of regulatory affairs for Airware, a drone technology company backed by Google Ventures. "I think Congress understands that, and hopefully they'll take steps in the coming year to address that."

That appears to be what some key lawmakers have in mind. "We in Congress are very interested in UAS," Rep. Bill Shuster, R-Pa., chairman of the House Transportation and Infrastructure Committee, said at a hearing this month, referring to unmanned aerial systems, or drones. "We understand UAS are an exciting technology with the potential to transform parts of our economy. ... It is our responsibility to take a close look."

One of the committee's first priorities next year is writing legislation to reauthorize FAA programs and overhaul aviation policy. The bill is expected to include directions from lawmakers on how to integrate drones into the nation's aviation system. The last reauthorization bill, passed in 2012, directed the agency to integrate drones by Sept. 30, 2015, but it's clear the FAA will miss that deadline.

The FAA is expected to propose restricting drones weighing less than 55 pounds to flying at altitudes under 400 feet, forbid nighttime flights and require drones be kept within sight of their operators. Drone operators may also be required to get pilot's licenses, a possibility already drawing fire from critics who say the skills needed to fly a manned aircraft are different from those needed to operate a drone.

Shuster indicated he's concerned that requiring pilot's licenses might be burdensome and unnecessary. And keeping drones within sight of operators would be too strict and limit their usefulness, he said.

The reason for keeping drones within line of sight is that they don't yet have the ability to detect and avoid other aircraft.

AUVSI, the drone industry trade group, recently hired Mark Aitken, former legislative director to Rep. Frank LoBiondo, R-N.J., as its government relations manager. LoBiondo is chairman of the House Subcommittee on Aviation, which will write the FAA reauthorization bill.

"We're really looking at an incremental approach still," Aitken said. "It's not something that is going to happen overnight."

Congress already is getting pushback from private and commercial pilots who worry about possible collisions. The FAA receives reports nearly every day about drones sighted flying near manned aircraft or airports.

"As a (Boeing) 737 captain, I'll be damned if myself and 178 other people are taken down by a 12-pound or a 50-pound or a 150-pound piece of metal coming through my windshield," said Ben Berman at a recent forum hosted by the Air Line Pilots Association. "There are too many near misses occurring every day like this."

Mark Baker, president of the Aircraft Owners and Pilots Association, which represents private pilots, said online videos show that "operators are flying near airports, in the clouds and in congested airspace." He called such actions "reckless" and said they will inevitably lead to a collision.

FAA regulations permit recreational users to fly small drones as long as they stay at least 5 miles away from an airport, limit flights to less than 400 feet in altitude, keep the aircraft in line of sight and fly only during the daytime.

Last week, drone industry trade groups teamed up with the FAA and model aircraft hobbyists to launch a safety campaign aimed at amateur drone operations. The campaign includes a website, www.knowbeforeyoufly.com , where operators can find FAA regulations and advice on how to fly safely. The trade groups said they also plan to distribute safety pamphlets at industry events and are working with manufacturers to see that safety information is enclosed inside the package of new drones.

Retailers say small drones, which are indistinguishable from today's more sophisticated model aircraft, were popular gifts this Christmas.

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Follow Joan Lowy on Twitter at http://www.twitter.com/AP_Joan_Lowy

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Online:

Drone safety campaign: http://www.knowbeforeyoufly.com

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Sony hacking spells diplomatic farce as China weighs in with equivocal position

HONG KONG -- The chorus of accusations over the hacking of Sony Pictures Entertainment this weekend developed into bout of diplomatic baiting and back-biting.

On Sunday China weighed in with commentary suggesting that Sony deserved its fate. That followed a move on Saturday by North Korea to offer a joint investigation with the U.S. The U.S. in turn said that North Korea would best help by owning up to being the state sponsor of the cyber vandalism.

"Any civilized world will oppose hacker attacks or terror threats. But a movie like The Interview, which makes fun of the leader of an enemy of the U.S., is nothing to be proud of for Hollywood and U.S. society," said an editorial in The Global Times, a tabloid sister paper to China's official The People's Daily.

"No matter how the U.S. society looks at North Korea and Kim Jong Un, Kim is still the leader of the country. The vicious mocking of Kim is only a result of senseless cultural arrogance," it said.

China is usually considered as the last major ally of North Korea, but the denunciation of the Sony film came as a senior Chinese army general was also laying into North Korea over its development of nuclear weapons without consulting China.

"China has cleaned up the D.P.R.K.'s mess too many times. "But it doesn't have to do that in the future," General Wang Hongguang wrote in the same Global Times. "If an administration isn't supported by the people, collapse is just a matter of time."

Whether that means that China will come to the help of the U.S. is unclear. The general's message can be read as showing that China and the U.S. are both frustrated by North Korea's manoeuvring. But it also shows that China today has less influence over North Korea that it previously did.

The Obama administration is seeking China's help in stopping North Korea from launching future cyber-attacks, the New York Times reported. "What we are looking for is a blocking action, something that would cripple their efforts to carry out attacks," an official told the paper.

On Saturday, a North Korean Foreign Ministry spokesman in capital Pyongyang proposed a joint investigation with the U.S., saying the North can prove it is not responsible for the hacking.

"The U.S. should bear in mind that it will face serious consequences in case it rejects our proposal for joint investigation and presses for what it called countermeasures while finding fault with" North Korea, the spokesman said in a statement carried by the Korean-language version of the Korean Central News Agency.

"We have a way to prove that we have nothing to do with the case without resorting to torture, as the CIA does," he said.

The U.S. government is not buying in to that. "If the North Korean government wants to help, they can admit their culpability and compensate Sony for the damages this attack caused," US National Security spokesman Mark Stroh said on Saturday.

© 2014 Variety Media, LLC, a subsidiary of Penske Business Media; Distributed by Tribune Content Agency, LLC

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New radiator for Frontier a precaution worth taking

I have a 2008 Nissan Frontier with the 4-liter engine, automatic transmission and 88,000 miles. In checking the Internet, apparently 2005-2010 Frontiers, Pathfinders and Xterras have had an issue with the radiator/transmission cooler failing, which results in coolant getting into the transmission and ruining it. Nissan states that the problem will only occur with a small percentage of vehicles. Nissan has extended the warranty on the radiator to 100,000 miles albeit with a $2,500-$3,000 deductible. I am considering proactively replacing the radiator just for the peace of mind. Do you have any recommendations on whether I should replace the radiator proactively or take my chances?

I confirmed the information you provided and understand the dilemma you face. You have three choices. Recognizing that this problem apparently affects a relatively small number of vehicles, you could ignore the issue, continue to drive your truck and keep your fingers crossed. Or, you could check the coolant and transmission fluids for correct levels or contamination on virtually a daily basis, hoping to catch the problem before it damages the transmission.

Or, as you are considering, pre-empt the issue and replace the radiator now. Since a new radiator from Nissan lists for over $650 plus three hours of labor to install it, check with cooling system specialists for a quote on installing an aftermarket radiator. I found exact-fit aftermarket radiators for your vehicle priced in the $100-$250 range at local auto parts stores.

If it were my vehicle and I could have a new radiator installed for under $500 — or install it myself for about half that — I'd be seriously inclined to do so.

I have a 2009 VW Jetta TDI. VW recommends oil changes at 10,000 miles using a synthetic that is only available at the dealer. My dealer says that VW hasn't seen any long-term detriment to using such a long interval. I understand the oils today are really superior in their protection. What do you think?

I really tried on this one. I researched, compared, pondered and cogitated — the whole nine yards. And yes, VW does recommend 10,000-mile oil change intervals on the TDI diesel engine. And yes, I don't think there would be any significant issues in following VW's recommendation.

But I just can't. I change oil and filter on our 2010 Passat Wagon equipped with the 2-liter turbo gasoline engine every 4,000-5,000 miles. I would do the same if it were the TDI. In this case, I see no downside in being pro-active on oil changes. Besides, it's your vehicle. You're responsible for it and you're going to pay for any repairs or excess depreciation. On top of that, the added cost for the extra oil changes is such a very, very small percentage of the total cost of ownership, depreciation, maintenance, repairs, licensing and insurance over the life of the vehicle, I don't think it should be a factor in your decision.

I am 5 feet 3 and I really like my new 2014 Honda Civic LX five-speed manual, but my left knee is only one tiny speck away from the dash and I am not 10 inches from the steering wheel, which would be dangerous if the air bag deployed. I called my dealership, my regular mechanic and a well-known body shop but I cannot find anyone who will install pedal extenders for me — apparently it's a liability issue. Could a non-mechanic like me buy pedal extenders and put them on myself?

Yes, you could. Pedal extenders are not difficult to install and I'm sure you could successfully install a set in your Civic. But before you do, check with local handicap/mobility stores in your area, specifically a store that specializes in building or outfitting handicap-equipped vehicles.

Go online to the National Mobility Equipment Dealers Association — NMEDA — at www.nmeda.com for a list of authorized handicap equipment installers in your area.

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Research shows owners coming up short on home values

WASHINGTON — Do American homeowners think their properties are worth less than the actual market value, as measured by professional appraisers?

Highly unlikely, you'd probably say. Everybody knows that owners tend to have optimistic impressions of what their homes are worth. They know how much money they've sunk into improving the place and they know — or think they know — the prices for houses in the neighborhood.

But provocative new research from the country's second-largest mortgage lender suggests the opposite may be true. According to new statistical analyses by Quicken Loans, owners on average now underestimate the value of their homes by 1.6 percent compared with appraisers' valuations.

Using massive databases of 50,000 to 60,000 new applications for mortgage refinancings per month, Quicken has created what it calls the Home Price Perception Index to measure the differences between owners' upfront estimates — routinely provided to loan officers as part of the application process — and the appraisals that are subsequently performed.

During November, owners seeking to refinance in roughly three-quarters of the major metropolitan areas covered by the index had lower estimates of their homes' worth than what turned out to be the appraised value, according to researchers. The dollar differences were not huge in most cases — between $2,000 and $4,000 on a $200,000 home. But in a few markets they were considerably larger. Owners in San Jose, Calif., estimated their houses to be worth 
6 percent less than the value subsequently determined by appraisers. With a median sale price of $860,000 for existing homes during the third quarter, a 6 percent perception gap translates into big bucks — $51,600.

In Los Angeles, applicants for refinancings underestimated values on average by 3.8 percent ($482,000 estimate versus $499,641 appraisal); in Seattle, the gap was 2.8 percent ($360,000 versus $370,080); Miami 2.3 percent ($270,000 versus $276,210); Boston 2.2 percent ($400,000 versus $408,880). In the Washington, D.C., area, the gap was 1.8 percent ($389,000 versus $395,885).

Owners overestimated values in a handful of major markets. In Philadelphia, the gap was 1.6 percent, Charlotte, N.C., 
1.3 percent and Chicago 0.3 percent. Quicken researchers found the widespread pattern of undervaluation is in distinct contrast with owners' estimates a few years ago, which often were far out of sync with appraisers' reports.

At the peak of the housing bubble in 2005-06, appraisals often came in below owners' estimates, in part because prices were spiraling upward at double-digit rates in overheated markets. In the recession years following the bust, the gap between what owners believed their homes to be worth and appraisers' valuations gradually narrowed, and by 2013, with the market rebounding solidly in many areas, it virtually disappeared. More recently, the trend has shifted to slight underestimations by owners.

Why are owners a little behind on pricing? Quicken chief economist Bob Walters attributes it in part to the fact that owners are more likely than professional appraisers to lag market trends. "Appraisers are looking at the market all the time," he said in an interview. Owners, especially those who are seeking to refinance but not sell, aren't as likely to stay on top of month-to-month changes.

Appraisers I contacted for reactions generally were skeptical of the Quicken index findings. Kenneth J. Mullinix of Laguna Beach, Calif., said "never" in 20 years in the business "have I done an appraisal where the owner has said to me, 'Wow, the appraised value is higher than I thought."

But one nationally known appraisal expert, Gary Crabtree of Bakersfield, Calif., thinks that Quicken may be on to something. "Today's homeowners have access to numerous (online) valuation tools and multiple listing service systems that they didn't have" until recently, he said in an email. As a result, they "tend to more closely track the market conditions in their neighborhood."

Does it matter much if you underestimate your home's worth by a percentage point or two? It definitely does if you plan to sell — you could end up leaving money on the table.

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Inspections show high pricing accuracy in Massachusetts

BOSTON — Last-minute holiday shoppers can shop with confidence that prices will be accurate.

A check on prices in 124 stores throughout Massachusetts showed the highest level of pricing accuracy in a decade.

The survey by the Massachusetts Division of Standards showed that of 3,150 items checked by inspectors, 99.94 percent were found to be accurately priced when compared with the lowest advertised price on the item or the shelf.

Division of Standards Director Charles Carroll said retailers who have installed in-aisle consumer price scanners are not required to individually price mark each item. That has eliminated some pricing errors.

The inspections were done in November in 27 communities, including Concord, Mansfield, Newburyport, Pittsfield, Plymouth and Springfield.

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Fox News, Fox Business removed from Dish in carriage-rights spat

Fox News Channel and Fox Business Network are not currently available on satellite-broadcaster Dish Network, the result of an impasse in carriage talks between the two companies.

Dish said in a statement early Sunday morning that 21st Century Fox had blocked access to the two networks after Dish balked when rates for other networks owned by the media conglomerate were made a part of the negotiations. Tim Carry, executive vice president of distribution at Fox News Channel, countered in a statement that "Dish prematurely ceased distribution of Fox News in an attempt to intimidate and sway our negotiations. It is unfortunate that the millions of Fox News viewers on Dish were used as pawns by their provider. Hopefully they will vote with their hard earned money and seek another one of our other valued distributors immediately."

Dish said it had offered a short-term contract extension that would have kept Fox News Channel and Fox Business Network on the air as the two parties continued to haggle over terms.

"Fox blacked out two of its news channels, using them as leverage to triple rates on sports and entertainment channels that are not in this contract." said Warren Schlichting, senior vice president of programming for Dish, in a company statement. "It's like we're about to close on a house and the realtor is trying to make us buy a new car as well," he said separately in the company's release.

Dish said it had offered a short-term contract extension that would have kept Fox News Channel and Fox Business Network on the air as the two parties continued to haggle over terms.

"Dish has had a productive relationship with Fox for many years," said Schlichting. "We regret the service disruption to our customers, and remain committed to reaching an agreement that promptly returns this content to Dish's programming lineup."

Fox's Carry said the company was disappointed by the breakdown in talks and noted Dish's stance in recent negotiations has resulted in three different blackouts of service in recent weeks, a reference to recent flare-ups between Dish and both Time Warner's Turner unit and CBS Corp. Fox News has been transmitted by Dish for nearly two decades without a blackout, Carry said.

"We care deeply about our viewers and hope that they will regain access to the number one cable news channel soon. We will continue to work around the clock to reach an agreement with Dish, as we have done with every other pay-TV provider for 18 years," said Carry. "This is the third time in as many months that Dish customers have suffered through a blackout due to Dish's intransigence."

Dish found itself at odds with both Time Warner's Turner and CBS Corp., both of which resulted in brief outages of such popular cable outlets as CNN and Cartoon Network. CBS was briefly off Dish for a matter of hours earlier this month but was back on the system after the two parties came to terms quickly after the broadcast network went dark.

Dish provides service to about 14 million people in the United States.

© 2014 Variety Media, LLC, a subsidiary of Penske Business Media; Distributed by Tribune Content Agency, LLC

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US companies eager to embrace Cuba face hurdles

WASHINGTON — Cargill aims to sell more corn and soybeans. MasterCard covets another site for Americans to swipe credit cards. Marriott sees beachfront property that needs hotels.

And outside Orlando, Florida, Danny Howell just knows there would be demand for his classic Chevrolet parts.

American businesses have begun imagining ways to capitalize on last week's announcement that the United States will restore diplomatic ties with Cuba and ease curbs on trade with one of the last surviving Communist regimes.

Their more ambitious plans would require that Congress lift the U.S. embargo on most exports to Cuba. Given sharp resistance from some in Congress, that might not happen soon. But many analysts think Congress will repeal the embargo eventually.

"It's great news — it's a totally untapped market," said Seth Kaplowitz, a lawyer and lecturer in finance at San Diego State University.

All that said, Cuba experts have a message for any business that might be envisioning easy riches:

Be patient.

After years of rigid market planning in Cuba and the half-century-old U.S. embargo, restoring economic ties to something close to normal is likely to be complex and time-consuming. The United States must change laws and regulations, and Cuba must build an economy more hospitable to foreign investment.

"The Cuban government has a long way to go and a lot more to do," said Jodi Bond, vice president of the Americas at the U.S. Chamber of Commerce. "I don't think any businesses are under the illusion that this is going to be an easy transition or the floodgates will open."

Still, the prospects are tantalizing.

Economists at the Peterson Institute for International Economics estimate that the export of U.S. goods to Cuba could eventually reach $4.3 billion annually, up from just $360 million in 2013. And Cuban exports of goods to the United States could reach $5.8 billion, from zero now.

A full lifting of the U.S. trade embargo could benefit, among others, U.S. farmers, auto and tractor makers, airline and hotel companies and telecom equipment makers. The United States now sells Cuba about $350 million a year in farm products, including rice corn, soybeans and frozen chicken parts, according to the American Farm Bureau. A 2000 law relaxed restrictions on food and medical exports.

Those exports could surge once the United States eases restrictions on financial transactions, which could happen soon. Cuban buyers of U.S. agricultural goods are required to pay up front, though international trade is usually done on credit.

"We have been pretty much hamstrung by the financial constraints," said Devry Boughner Vorwerk, a vice president at Cargill, the agriculture giant. She called the U.S. move "a great first step."

U.S.-based travel companies have been eager to embrace the Caribbean island, just an hour's flight from Miami. Delta Air Lines, JetBlue Airways, Hilton Worldwide, Marriott International and the Carnival Corp. all expressed interest last week, though most of their plans would have to await a repeal of the embargo.

CEO Arne Sorenson said in a statement that Marriott looks "forward to opening hotels in Cuba, as companies from other countries have done already."

Apple Leisure Group, which books 2 million vacation packages to the Caribbean a year and is about to open its 38th hotel in the region, is developing a plan for Cuba.

"We could very rapidly put charters onto the island" or buy a hotel and convert it into one of its Sunscape brand resorts, CEO Alex Zozaya said. He envisions a market for the company's higher-end hotels, like Secrets and Dreams.

Eventually, that is.

"Cuba does not have the right infrastructure yet to satisfy the mid-to-high-end market," Zozaya said.

Cuba, which can appear stuck in a 1950s time warp, desperately needs investment. The island lags far behind its neighbors Haiti and the Dominican Republic in the proportion of its economic output that goes into public infrastructure like roads, factories and housing. In fact, Cuba has one of the lowest investment rates in the world, according to the World Bank.

If the embargo is lifted, U.S. refiners could find a new market in Cuba for gasoline and diesel or refining technology. Cuba has been struggling to find a partner to finance an upgrade and expansion of its largest refinery. And suppliers of electric power generation and transmission equipment, like General Electric, could help improve and expand electricity services on the island.

American technology firms will likely be interested in putting Cubans to work assembling electronic components, taking advantage of low-wage labor far closer to the United States than India and China are.

But businesses eager to break into Cuba will face numerous obstacles:

— THE U.S. GOVERNMENT

President Barack Obama's announcement only relaxed restrictions on traveling and doing business in Cuba. And even Obama's limited action will require government regulators to craft new rules. The United States, for example, will now let companies like John Deere sell tractors to small private Cuban farmers but not to government-run farms. Yet it's not clear how the eligible farms will be defined.

"All these regulations have to be written; it's not simple," says Kirby Jones, a consultant on U.S.-Cuba trade issues. "That could take weeks or months."

— CUBA'S GOVERNMENT

Havana has sent mixed messages about its appetite for foreign involvement in its economy. In March, Cuba passed a law meant to attract foreign investment. But in September, it jailed a Canadian executive on corruption charges — a move that sent a chill through the expatriate community.

"The climate for foreign investment is not that great," said Archibald Ritter, an economist at Carleton University in Ottawa who specializes in Cuba. Ritter said foreign companies that want to enter the Cuban market might be required to establish joint ventures with state-owned firms.

China required such arrangements as it opened its economy in the 1980s and 1990s, and many U.S. and other foreign companies found the joint ventures useless and costly.

—THE CUBAN ECONOMY

Cuba is hardly rich. Its economy ranks No. 69 in the world, about the size of Hawaii's. Income per person is just $6,200, according to the United Nations. That means that Detroit automakers, for example, are unlikely to enjoy big sales in Cuba.

"Nobody can buy a brand-new car," said Karl Brauer, senior analyst for Kelley Blue Book.

U.S. car sales have been banned in Cuba since 1959. Cubans have been have been forced to patch together Fords, Chevrolets and Chryslers that date back to before Fidel Castro's revolution.

Since the Communist economic system isn't likely to change soon, many of those cars will have to stay on the road for years. That could mean an opportunity for U.S. companies that make or distribute vintage car parts, Brauer said.

Enter Danny Howell, who sells parts for classic Chevrolets near Orlando. His business, Southeast Chevy Parts Inc., specializes in original parts dating to 1955.

Howell, who scours car ads and storage facilities to buy cars for parts, already sells indirectly to Cuba. U.S. citizens who have Cuban relatives often buy parts and send them to Cuba to keep the old cars running. Demand should grow as trade restrictions are eased, Howell said.

"I would be delighted if the door were opened," he says.

___

AP Business Writers Scott Mayerowitz, Jonathan Fahey, Ken Sweet and Barbara Ortutay in New York, Michael Liedtke in San Francisco, Christopher S. Rugaber in Washington and Tom Krisher in Detroit contributed to this report.

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Studio Babelsberg braces for $3 million annual loss

BERLIN -- Despite major projects this year, including Steven Spielberg's latest Cold War drama and the "Point Break" remake, Germany's Studio Babelsberg is expecting a €2.5 million ($3 million) loss for 2014.

In an interview with German financial newspaper Handelsblatt on Friday, Studio Babelsberg president and CEO Charlie Woebcken said he hoped the studio would survive next year. Separately, the studio's vice president and chief operating officer, Christoph Fisser, told German news agency DPA that the company lacked planning certainty after two key productions it was banking on this year failed to materialize.

The studio is forecasting 2014 revenue of €50 million ($61.1 million), down from €81.9 million ($100.1 million) last year.

Studio Babelsberg has regularly fluctuated between annual losses and profits over the years, depending the number of international co-productions they had in any given year. In 2013, for example, the studio posted a profit of €843,000 ($1.03 million) after suffering a hefty loss of €7.2 million ($8.8 million) the year before, which in turn followed a 2011 profit of €356,000 ($435,362). Due to the studio's somewhat erratic business operations and difficulties in maintaining stable revenue levels, the company is planning to delist from the stock market in 2016.

Studio Babelsberg execs have also lobbied hard against plans by the German government to cut federal film subsidies by €10 million ($12.2 million) next year -- a move that could hit the studio particularly hard. The Bundesrat, one of the two houses of Germany's parliament, voted on Friday to maintain the German Federal Film Fund (DFFF) at its current level of €60 million ($73.4 million) a year -- a positive signal that may move Chancellor Angela Merkel's government to reconsider the decision.

The DFFF has been instrumental for Studio Babelsberg in luring major international productions to Germany, including recent productions like Spielberg's untitled Cold War drama starring Tom Hanks, Ericson Core's $100 million "Point Break" remake, which received $4.4 million in support, and Francis Lawrence's "The Hunger Games: Mockingjay," which secured nearly $5 million.

Nearly 30 international co-productions have benefited from DFFF coin this year, including Eran Creevy's high-speed actioner "Autobahn," starring Nicholas Hoult, with €2.58 million ($3.15 million).

© 2014 Variety Media, LLC, a subsidiary of Penske Business Media; Distributed by Tribune Content Agency, LLC

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US mulls putting NKorea on terrorism sponsor list

HONOLULU — President Barack Obama says the United States is reviewing whether to put North Korea back on its list of state sponsors of terrorism as Washington decides how to respond to what he calls an "act of cybervandalism," not one of war, against a movie company.

Sony Pictures Entertainment, which said it canceled the theatrical release of "The Interview" after distributors refused to show it, pledged to find a way to get the film out. "How it's going to be distributed, I don't think anybody knows quite yet," a Sony lawyer said. The comedy involves a plot to assassinate North Korea's leader.

Obama is promising to respond "proportionately" to an attack that law enforcement blames on North Korea. "We're not going to be intimidated by some cyberhackers," he said.

The president said the U.S. would examine the facts to determine whether North Korea should land back on the terrorism sponsors list.

"We're going to review those through a process that's already in place," Obama told CNN's "State of the Union" in an interview broadcast Sunday. "I'll wait to review what the findings are."

While raising the possibility of a terrorism designation, Obama also asserted, "I don't think it was an act of war. I think it was an act of cybervandalism that was very costly, very expensive. We take it very seriously."

Obama's description drew immediate scorn from two Republicans who are longtime critics of his foreign policy.

"It is a new form of warfare, and we have to counter with that form of warfare with a better form of warfare," said Arizona Sen. John McCain.

Sen. Lindsey Graham of South Carolina called it "an act of terrorism" and favored reimposing sanctions and adding North Korea to the terrorism list. The U.S. needs to "make is so hard on the North Koreans that they don't want to do this in the future."

North Korea spent two decades on the list until the Bush administration removed it in 2008 during nuclear negotiations. Only Iran, Sudan, Syria and Cuba remain on the list, which triggers sanctions that limit U.S. aid, defense exports and certain financial transactions.

But adding North Korea back could be difficult. To meet the criteria, the State Department must determine that a country has repeatedly supported acts of international terrorism, a definition that traditionally has referred to violent, physical attacks rather than hacking.

North Korea threatened to strike back at the United States if Obama retaliated, the National Defense Commission said in a statement carried by the country's official Korean Central News Agency. The statement offered no details of a possible response.

The U.S. is asking China for help as it considers how to respond to the hack. A senior Obama administration official says the U.S. and China have shared information about the attack and that Washington has asked for Beijing's cooperation.

The official was not authorized to comment by name and spoke on condition of anonymity.

China wields considerable leverage over North Korea, but Obama has accused China of carrying out cyberthefts, too.

In the CNN interview, taped Friday in Washington before Obama left to vacation in Hawaii, Obama renewed his criticism of Sony's decision to shelve "The Interview," despite the company's insistence that its hand was forced after movie theaters refused to show it.

Obama suggested he might have been able to help address the problem if given the chance. "You know, had they talked to me directly about this decision, I might have called the movie theater chains and distributors and asked them what that story was," he said.

Sony's CEO has disputed that the company never reached out, saying he spoke to a senior White House adviser about the situation before Sony announced the decision. White House officials said Sony did discuss cybersecurity with the federal government, but that the White House was never consulted on the decision not to distribute the film.

"Sometimes this is a matter of setting a tone and being very clear that we're not going to be intimidated by some, you know, cyberhackers," Obama said. "And I expect all of us to remember that and operate on that basis going forward."

David Boies, a Sony lawyer, said "The Interview" is "going to be distributed, and what Sony has been trying to do is to get the picture out to the public," while protecting the rights of company employers and moviegoers.

Boies said theaters "quite understandably" decided not to show the film as scheduled because of the threats. "You can't release a movie unless you have a distribution channel," he said.

North Korea has denied hacking the studio, and on Saturday proposed a joint investigation with the U.S. to determine the true culprit. The White House rejected the idea and said it was confident North Korea was responsible.

But the next decision — how to respond — is hanging over the president as he vacations with his family in Hawaii.

Obama's options are limited. The U.S. already has trade penalties in place and there is no appetite for military action.

"I think we've got to recognize that this is not a Sony security problem. This is a national security problem," Boies said.

Boies appeared on NBC's "Meet the Press," Graham was on CBS' "Face the Nation" and McCain spoke on CNN.

___

Reach Josh Lederman at http://twitter.com/joshledermanAP

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Canadian man told to pay $1.5 million for credit card fraud

FARGO, N.D. — It took nearly eight years from the time a Toronto man was arrested in a massive credit card fraud scheme, but a federal judge has figured out how much each victim is owed.

Adekunle Adetiloye (aw-duh-KUHN-lee aw-duh-tuh-LOH'-ee) pleaded guilty earlier to mail fraud and was sentenced to 18 years in prison. Authorities say he stole the identities of about 38,000 people in order to bilk dozen of banks.

U.S. District Judge Ralph Erickson ruled earlier this month that Adetiloye should pay about $1.5 million in restitution and forfeiture. Adetiloye is appealing the ruling.

Prosecutors say Adetiloye was the leader of an international scheme that involved fake debt-collection agencies.

It's not clear whether any of the victims will be paid. Adetiloye's lawyer would not comment on his client's financial situation.

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Republicans urge theaters to show 'Interview': 'we cannot be bullied into giving up freedom'

The Republican National Committee is urging theater owners to play the "The Interview" following Sony's decision to pull the plug on the controversial comedy, CNN reports.

RNC chairman Reince Priebus has sent a letter to the CEOs of 10 major theater chains asking them to show the film, which has been the source of hackers' wrath in the last month.

"I want to speak clearly on behalf of the Republican Party: I urge you to show the movie," Priebus wrote to the CEOs, according to CNN. "As a sign of my commitment, if you agree to show this movie, I will send a note to the Republican Party's millions of donors and supporters urging them to buy a ticket -- not to support one movie or Hollywood, but to show North Korea we cannot be bullied into giving up our freedom."

On Friday, President Barack Obama declared that Sony "made a mistake" in cancelling "The Interview's" release.

"I wish they had spoken to me first. … We cannot have a society in which some dictator someplace can start imposing censorship," Obama said at a news conference, referring to Sony execs. His speech has since been praised by conservative political pundits.

Sony Pictures Entertainment chairman Michael Lynton has defended the studio's decision, insisting that they "had no choice" but to cancel the Christmas release following hackers' threats of 9/11-like violence that forced theaters to pull the film.

"We have not caved. We have not given in. We have persevered," Lynton told CNN in an interview that will air on "AC360" on Sunday.

The RNC letter also said that a foreign regime -- referring to North Korea, which the FBI has linked to the cyber-attacks -- shouldn't "dictate the movies we can and cannot watch."

"As you know, the Republican Party and Hollywood have at times been at odds," the letter continued. "But we can all agree that the current situation regarding the release of 'The Interview' goes far beyond politics. It is about freedom and free enterprise."

© 2014 Variety Media, LLC, a subsidiary of Penske Business Media; Distributed by Tribune Content Agency, LLC

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Crunch time again for health insurance sign-ups

WASHINGTON — President Barack Obama's push to cover America's uninsured faces another big test Monday.

This time, it's not only how the website functions, but how well the program itself works for millions who are starting to count on it.

Midnight Monday, Pacific time is the deadline for new customers to pick a health plan that will take effect Jan. 1, and for current enrollees to make changes that could reduce premium increases ahead of the new year.

HealthCare.gov and state insurance websites are preparing for heavy online traffic before the deadline, which gives consumers in the East three hours into Tuesday to enroll.

Wait times at the federal call center started creeping up around the middle of last week, mainly due to a surge of current customers with questions about their coverage for next year. Many will face higher premiums, although they could ease the hit by shopping online for a better deal. Counselors reported hold times of 20 minutes or longer for the telephone help line.

About 6.7 million people now have coverage through Obama's signature law, which offers subsidized private insurance. The administration wants to increase that to 9.1 million in 2015. To do that, the program will have to keep most of its current enrollees while signing up more than 2 million new paying customers.

People no longer can be turned down because of health problems, but picking insurance still is daunting for many consumers. They also have to navigate the process of applying for or updating federal subsidies, which can be complex for certain people, including immigrants. Many returning customers are contending with premium increases generally in the mid-to-high single digits, but much more in some cases.

Consumers "understand it's complicated but they appreciate the ability to get health insurance," said Elizabeth Colvin of Foundation Communities, an Austin, Texas, nonprofit that is helping sign up low-income residents. "People who haven't gone through the process don't understand how complicated it is."

Last year's open enrollment season turned into a race to salvage the reputation of the White House by fixing numerous technical bugs that crippled HealthCare.gov from its first day. With the website now working fairly well, sign-up season this year is a test of whether the program itself is practical for the people it is intended to serve.

New wrinkles have kept popping up, even with seemingly simple features of the Affordable Care Act.

For example, most current customers who do nothing will be automatically renewed Jan. 1 in the plan they now are in. At this point, it looks like that is what a majority intends to do.

While that may sound straightforward, it's not.

By staying in their current plans, people can get locked into a premium increase and miss out on lower-priced plans for 2015. Not only that, they also will keep their 2014 subsidies, which may be less than what they legally would be entitled to for next year.

Doing nothing appears to be a particularly bad idea for people who turned 21 this year, according to the Center on Budget and Policy Priorities, a Washington group that advocates for low-income people.

Researchers at the center estimate that 21-year-olds will see a 58 percent increase in the sticker price for their premiums just because they're a year older. An age-adjustment factor used to compute premiums jumps substantially when a person turns 21. A 20-year-old whose premium was $130 per month in 2014 will see the premium climb to $205 a month in 2015, solely because of that year's difference.

Tax-credit subsidies can cancel out much or even all of the impact. But if consumers default to automatic renewal, their tax credits will not be updated and they will get the same subsidy as this year.

"Even in the best possible scenario of how many people we can expect to come in, we will still see a substantial number of people defaulting," said Judy Solomon, a health care policy expert at the center. She worries that some young adults may get discouraged and drop out.

Reviews of HealthCare.gov and state health insurance exchanges are mixed.

An Associated Press-GfK poll this month found that 11 percent of Americans said they or someone else in their household tried to sign up since open enrollment began Nov. 15. Overall, 9 percent said the insurance markets are working extremely well or very well. Twenty-six percent said the exchanges are working somewhat well, and 39 percent said they were not working well. The remaining 24 percent said they didn't know enough to rate performance.

So far it has been a frustrating experience for Marie Bagot, of Fort Lauderdale, Florida. She and her husband are in their 60s, but not yet old enough for Medicare. The husband, who works as a chef, will turn 65 around the middle of next year and qualify for Medicare. Bagot said they were happy with their insurance this year under Obama's law.

"As you get older, you worry about your health," she said. "I was very pleased with the price we got."

But Bagot said she received a notice from her insurer that her current plan will not be available next year in her community. The closest alternative would involve a premium increase of more than $350 a month, even with their tax credit subsidy. After days of trying to find a comparable plan through the federal call center and after visiting a counselor, Bagot said she opted to keep their current coverage, while hoping costs go down after her husband joins Medicare.

"I cannot afford it, but I'm going to try to," she said.

Monday is not the last chance for consumers like Bagot. Open enrollment doesn't end until Feb. 15.

___

Associated Press Director of Polling Jennifer Agiesta contributed to this report.

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Lower lobster catch in 2014 means higher prices

PORTLAND, Maine — The 2014 lobster fishing season appears to have resulted in a lower total catch than the previous two years — meaning slightly higher prices for consumers — but it remained a productive year, lobstermen say.

Maine's lobster fishery, the largest in the country, topped 125 million pounds in 2012 and 2013. The 2012 catch of more than 127.2 million pounds was the highest since record-keeping began in 1880.

This year's catch was robust, but fishermen and industry officials said they don't expect to touch those numbers. As a result, the value of lobsters rose, as did their price tag in markets.

The high catches of 2012 and 2013 seemed to depress value somewhat, as the $2.69 per pound lobstermen averaged for their hauls was the lowest since 1994, state records show. The 2013 price of $2.89 per pound was the fourth lowest in that same time period.

Some lobstermen reported a slightly higher price in 2014, said Sheila Dassatt, executive director of the Downeast Lobstermen's Association.

"We are not hearing any unhappy complaints this year," Dassatt said. "They were happy that they didn't have to catch as many in order to make as much money."

The season typically picks up after the bulk of lobsters shed shells and reach legal catch size. Fishermen said this year was characterized by a slightly later shed than 2012 and 2013, when the shed took place in June.

This year's shed appeared to happen in mid-July, when catches started to pick up, said Patrice McCarron, executive director of the Maine Lobstermen's Association. She and others in the industry said this year's season seemed like a reversion to a more typical lobstering year, while the early sheds and huge catches of 2012 and 2013 were likely anomalies.

"I think the expectation is it's probably not a record year, but probably very strong," McCarron said. "The overall signal of the fishery was much more in line with what we typically see."

State officials will provide official data for the lobster fishing year, which runs all year long but peaks in the summer, in 2015.

Lobster catches came on strong in August this year, said Steve Hale, a Rockland lobsterman who has been fishing for lobster for more than 30 years. He described recent years as "unusual" in terms of the volume of catch, and said this season was more traditional.

"Everybody paid their bills," Hale said. "I think statewide, it's going to be a little less."

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New app hits the parking SPOT

For Boston drivers, easy and parking are two words rarely found together.

SPOT CEO Braden Golub wants to change that. His new mobile app launched on Thursday connects private spot owners and drivers looking for a place to park.

The idea was born out of necessity, said Golub, who was up early Saturday mornings feeding the meter on his girlfriend's car, when she stayed at his Back Bay apartment.

As he walked home, he noticed 20 out of the 25 spots in his private lot empty.

"I would've gladly paid someone to park her car in one of those empty spots," he said. "There's got to be a better way."

Through the app, spot owners rent their unused space for anywhere from an hour to a month and SPOT takes a 15 percent cut on the transaction.

Owners set their own price, which is generally 40-60 percent cheaper than nearby garages.

Touted as the airbnb.com of parking, SPOT amassed 6,000 users since its beta launch in June.

About 90 percent of those users are renters, while only 10 percent are spot owners, but Golub said he hopes to build up inventory in the coming months.

Allston resident Sasha Garfunkel uses SPOT to find parking in Brookline when she visits her boyfriend.

"It's been really easy and convenient," she said. "In Brookline you're not allowed to park anywhere and sometimes I'd have to have my boyfriend come pick me up, so I jumped on the opportunity not to have to do that."

Golub took other cities into consideration for the launch, but found Boston was the "perfect geographical area" for an app like SPOT.

Since SPOT only deals with private property, they have not run into any issues with the city.

SPOT plans to expand to Chicago, Philadelphia, Washington, D.C., Miami, Los Angeles and San Francisco in early 2015.

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Virus, drought to hike grocery prices despite cheap gas

A dramatic drop in the price of gas won't make your grocery bill any easier to swallow because officials are forecasting a hike in food prices in nearly every category, due to brutal drought, fluctuations in demand and a virus afflicting farm animals.

"For 2015, we're predicting the price of food will increase 2 to 3 percent," said Annemarie Kuhns, agricultural economist at the U.S. Department of Agriculture's Economic Research Service, which takes into account several factors, including the Consumer Price Index, the price of energy and grocery store wages.

The USDA is predicting hikes of 4.5 to 5.5 percent for beef, veal and pork — by far the highest jump expected.

Poultry, seafood, dairy, and fruits and vegetables are also expected to climb by 2.5 to 3.5 percent, with sugar and sweets seeing a 2.5-percent hike, the USDA fears.

Eggs, cereals and bakery products are all expected to increase less than 1.5 percent.

Beef and veal prices will likely continue to reflect a cattle inventory that is at a historic low due to drought in Texas and Oklahoma, Kuhns said, while porcine epidemic diarrhea virus, which affects pigs' litter sizes and increases piglet mortality, is expected to push up the price of pork.

Demand for cheese and other dairy products also remains high, supporting increased prices, she said.

The hikes are expected even as major drops in the prices of gas and diesel needed to transport food are saving grocery stores big money.

"For the food supply chain, if the price of fuel and energy in general is going down, it's a windfall," said Andrew Wolf, senior equity research analyst at BB&T Capital Markets' Food and Agribusiness Group in Boston. "They won't lower their prices, but it'll mean less inflation in prices because one of their big costs has just dropped."

Nationally, the average price of regular gasoline on Friday was $2.60 per gallon, down 11.7 cents from a week earlier and 65.2 cents from last year, while the average price of diesel was $3.44, down 8 cents and 41 cents, respectively.

But whatever amount consumers save through lower gas prices could be cancelled out by the across-the-board food price increases the USDA is predicting.

"If the price of food increases 2 to 3 percent, that would have some negative impact on household budgets because it's higher than the rate of inflation and wage rates," said Alan Clayton-Matthews, associate professor of economics and public policy at Northeastern University.

The impact will be particularly hard felt by people already struggling to make ends meet, said John Drew, president and CEO of Action for Boston Community Development.

"The vast majority of Americans will be affected because most people's wages aren't going up," Drew said. "But it will affect the poor and unemployed or underemployed even more because a lot of them still are just trying to hold onto their housing. If the price of food goes up, they're going to have to decide: Do I pay the rent or mortgage, or do I feed my family?"

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Hackers to Sony: ‘Christmas gift’ to be the worst

Sony hackers have promised to release a disastrous "Christmas gift" that will "put Sony Pictures into the worst state" — another round of embarrassing personal emails, according to multiple news reports.

One of the emails allegedly ridicules Leonardo DiCaprio for passing on an upcoming Steve Jobs biopic.

"Was this about the deal ... or did he just change his mind," movie producer Mark Gordon said in a leaked email, which was published online yesterday. "The latter," responded Sony Pictures co-chairman Amy Pascal, reports state.

The Sony hack, which was first reported last month, has not only revealed thousands of private emails sent by top executives, it also made thousands of employee Social Security numbers public and leaked five new Sony films, including the "Annie" remake, Brad Pitt's "Fury," and "Still Alice" to online file-sharing hubs.

In one of the leaked messages, Oscar-winning movie producer Scott Rudin reportedly called Angelina Jolie a "minimally talented spoiled brat," according to multiple reports.

But it looks like the worst is yet to come — "We are preparing for you a Christmas gift," reads a message from the hackers that was posted online yesterday, according to Variety. "The gift will be larger quantities of data. And it will be more interesting. The gift will surely give you much more pleasure and put Sony Pictures into the worst state."

Evidence is mounting that North Korea, outraged over the upcoming comedy "The Interview," may have launched the cyber attack.

The comedy is about a pair of hack TV journalists — played by Seth Rogen and co-star James Franco — who are recruited by the CIA to assassinate Kim Jong Un after they land an interview with the North Korean leader.

North Korea's state-run news agency KCNA declared the film an "act of war" and promised "a merciless counter-measure" if the U.S. allowed it to be distributed.

"The Interview" is set to be released in theaters Christmas Day.

Herald wire services contributed to this report.

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Drug companiess to lose $65 billion on patents

Pharmaceutical companies will lose an estimated $65 billion in sales by 2019 due to patent expirations of leading drugs, according to one research and consulting firm.

The companies that will likely be hardest hit include Otsuka, Eli Lilly and AstraZeneca, which has a research and development center in Waltham, according GlobalData.

Eli Lilly and AstraZemeca have seen profits fall in the central nervous system therapeutics market since 2010, with AstraZeneca losing the greatest share over the past three years, said Adam Dion, a GlobalData analyst covering healthcare industry dynamics.

AstraZeneca "has been bleeding sales" in that market since it lost its patent on Seroquel, a treatment for bipolar disorder, which led to the entry of cheaper, generic alternatives, Dion said.

The company's market share has dropped from about 9 percent in 2010 to about 3 percent last year, he said.

"In the United States, when a patent expires on a small-molecule drug, the generics can be many, and you can lose 90 percent of your revenues or more," said Seamus Fernandez, a Leerink Partners analyst. "That kind of competition decreases the sustainability of your revenue stream."

Eli Lilly's market share fell from 14.3 percent in 2010 to 11.2 percent in 2013, primarily due to decreasing sales of Zyprexa, which is used to treat schizophrenia and bipolar disorder, Dion said. Zyprexa sales have plunged from more than 
$5 billion to $1.2 billion since the company lost its U.S. patent exclusivity in 2011, he said.

Otsuka's anti-psychotic drug Abilify was the sales leader in the central nervous system market, with $9.5 billion last year, Dion said. But the company stands to lose $6.2 billion by 2019 as a result of generic competition after Abilify's U.S. patent expires next year, "making it the biggest victim of the pharmaceutical industry's current patent cliff," he said.

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Journalists, police are detained in Turkish raids

ANKARA, Turkey — Police conducted raids in a dozen Turkish cities Sunday, detaining at least 24 people — including journalists, TV producers and police — known to be close to a movement led by a U.S.-based moderate Islamic cleric who is a strong critic of President Recep Tayyip Erdogan.

It was the latest crackdown on cleric Fethullah Gulen's movement, which the government has accused of orchestrating an alleged plot to try to bring it down. The government says the group's followers were behind corruption allegations that last year that forced four Cabinet ministers to resign.

Gulen, who lives in self-imposed exile in Pennsylvania, denies the accusations.

During a speech on Saturday, Erdogan vowed to "bring down the network of treachery and make it pay."

The state-run Anadolu Agency said a court issued a warrant to arrest 32 people connected to the movement, and that 24 of them were detained in raids in Istanbul and other cities across Turkey on Sunday. They included Ekrem Dumanli, the chief editor of Zaman newspaper, who was taken into custody at his paper's Istanbul headquarters, which was broadcast live on television.

Those with arrest warrants included Hidayet Karaca, the chief executive of Samanyolu television, as well producers of two of its TV shows. Both Zaman and Samanyolu are affiliated with the movement.

Anadolu said those detained are suspected of "using intimidation and threats" to try to wrest control of state power. The state-run news agency said some of the police officers detained are suspected of fabricating crimes and evidence while investigating an organization close to the al-Qaida terror network back in 2010. 

Hundreds of supporters gathered outside Zaman's headquarters to protest the detention of Dumanli and other suspects, shouting: "Free press cannot be silenced."

Turkey's journalism associations also denounced the raids targeting journalists, while Human Rights Watch said the detentions look "like another attempt to crack down on critical media."

Several police officers believed to be close Gulen's movement were arrested earlier this year for alleged illegal wiretaps and other charges. The government has said it wants Gulen extradited to Turkey from the United States. Many see his moderate movement as an alternative to the more radical interpretations of Islam.

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UMass Lowell gets $1.4m grant for eye injury study

LOWELL, Mass. — A University of Massachusetts Lowell researcher has received a $1.4 million grant to fund a study into the link between serious eye injuries and lifting heavy objects.

Professor David Kriebel, a faculty member in the school's Department of Work Environment, is evaluating whether preventable factors such as muscle strain can cause retinal detachment. The retina pulling away from blood vessels is a common medical emergency that can lead to irreversible vision damage.

Kriebel said that if the study confirms the link, his research team will be able to recommend strategies for preventing the injury.

The study will be conducted over four years in collaboration with the Reliant Medical Group of Worcester.

The grant came from the National institute for Occupational Safety and Health.

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Identity theft victims face months of hassle

SAN FRANCISCO — As soon as Mark Kim found out his personal information was compromised in a data breach at Target last year, the 36-year-old tech worker signed up for the retailer's free credit monitoring offer so he would be notified if someone used his identity to commit fraud.

Someone did. The first monitoring report showed crooks opened accounts in his name at Macy's and Kohl's department stores, where they racked up more than $7,000 in charges. "My heart basically sank," he said. Over the next seven months the New York City resident spent hours on the phone, most of a day in a police station filing a report, and countless time sending documents to banks and credit reporting agencies to clear his credit history.

He's hardly alone. The Target hack during last year's Black Friday shopping weekend was just one in a wave of data breaches that have exposed more than 100 million customer records at U.S. retailers, banks and Internet companies. The latest high-profile hack, at Sony Pictures Entertainment, resulted in Social Security numbers and other personal details of nearly 50,000 current and former Sony employees and film actors being stolen and posted online for anyone to see. While cases are difficult to trace, analysts at Javelin Strategy & Research estimate that one in three Americans affected by a data breach ultimately became the victim of fraud last year — up from one in nine in 2010.

Although banks often absorb bogus charges, it's up to victims to clean up their credit histories and recover stolen funds. On top of lost time, money and emotional energy, victims face the frustration of rarely seeing anyone pay for the crimes. Identity theft cases are rarely prosecuted, said Avivah Litan, an analyst who studies fraud and identity theft for the research firm Gartner. Local police have limited resources, and criminals are often overseas, "so unless it's part of a bigger pattern, they're not going to spend much time pursuing it." Kim said a police detective who took his complaint later told him the accounts were opened by someone in California, but Kim never heard any more about the investigation.

In the past year, Target and other major retailers have said they're increasing security. President Obama has urged banks and stores to speed up adoption of "chip-and-pin" payment cards, which are harder to hack. But reports of data breaches continue. And as Federal Trade Commission member Terrell McSweeney said recently, "Disturbingly, the news has seemed to desensitize many people to the real risks created each time an event occurs."

Kim can't be certain Target was the source of the fraud he experienced, he acknowledged. Experts say crooks often steal or buy consumer information from more than one source, and use it to compile a complete dossier on potential victims. That's likely the way hackers last year impersonated the rich and famous to get credit reports on Paris Hilton, Michelle Obama and even General Keith Alexander, then-head of the National Security Agency.

Alexander told a public forum this fall that when he tried to file his taxes, he learned someone else had already claimed a $9,000 refund in his name. Fraudsters also used his identity to apply for about 20 credit cards. The FBI eventually caught a suspect, he said; the FBI declined comment.

Meticulous by nature, Kim documented every conversation with an investigator or company representative. He was fortunate, he added, that his employer let him use the phone and fax machine where he works. "If I worked at a stricter company, it would have been a nightmare," he said. But Kim was never reimbursed for sending affidavits and other documents by certified mail to various banks and agencies.

While identity theft is certainly a global problem, experts say it's difficult to measure worldwide losses. However, a Department of Justice study estimates identity theft of all kinds was responsible for U.S. financial losses of $24.7 billion in 2012 — nearly double the $14 billion lost from all other property crimes such as burglary and theft. According to Javelin surveys in the U.S., when an existing credit card is exposed and then used for fraud, the average loss is $1,251. When a social security number is exposed and then used to open new accounts, the average loss is $2,330.

Banks take the biggest financial hit, but identity theft victims' out-of-pocket losses can range from an average of $63 for misuse of credit cards to $289 for fraud involving social security numbers. Of course that doesn't quantify lost time and stress.

Albert, who didn't want his last name published because he fears being victimized again, learned in 2012 that his personal information was exposed by a data breach at University of Miami Hospital, where he'd gone for minor surgery. After submitting his federal tax return the following year, the 60-year-old Miami resident found the government had already issued a refund to someone else using his social security number.

It took eight months for the airline reservations employee to get his $4,000 refund, which he needed to pay off debts. Albert said he doesn't know if the tax scammer used personal information from the hospital breach or some other source. But experts say health records are a treasure trove for scammers, since they may contain financial information, insurance numbers and personal data that can be used to obtain drugs, medical services or other benefits.

Albert now subscribes to a credit monitoring service and has asked reporting agencies for a "freeze" to block any applications for credit in his name. However, that "freeze" required a laborious process to lift when he later applied for a mortgage and then Internet service from AT&T. He still worries someone will claim the Social Security benefits he's counting on when he retires.

"There's a rage that comes up, when you realize what happened," he said. "You feel violated. You feel attacked."

Kim just got all of the fraudulent accounts removed from his credit history this month. He and other victims say the experience has made them even more careful about their financial data and credit records. Kim, for example, registered for a security alert from the major credit reporting agencies, which advises lenders to contact him if someone tries to get credit in his name.

The alert expires in seven years, but Kim said he "absolutely" plans to renew it.

"I have to be watchful," he added. "I know something else could happen."

___

AP National Reporter Martha Mendoza contributed to this report from San Jose, California.

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Your info has been hacked. Now what do you do?

SAN FRANCISCO — Criminals stole personal information from tens of millions of Americans in data breaches this past year. Of those affected, one in three may become victims of identity theft, according to research firm Javelin. Whether shopping, banking or going to the hospital, Americans are mostly at the mercy of companies to keep their sensitive details safe. But there are steps you can take to protect yourself against the financial, legal and emotional impact of identity theft — and most of them are free:

AS A RULE:

— Closely guard your social security numbers — and those of your children — as well as credit and debit card information and account passwords.

— Shred unneeded financial records and credit offers.

DETECTIVE WORK:

— Examine credit card bills for irregularities each month.

— Get a free credit report once a year from at least one of the major reporting agencies (Equifax, Experian, TransUnion), and review it for unauthorized accounts. Ignore services that charge a fee for credit reports. You can order them without charge at www.annualcreditreport.com . If you order from each agency once a year, you could effectively check your history every four months.

DO PAID SERVICES WORK?

— Some experts say there's not much to be gained from a paid credit monitoring service. But if a business sends you a notice of a data breach, it can't hurt to sign up for any monitoring they offer for free. These services will tell you if a new account is opened in your name, but they won't prevent it, and many don't check for things like bogus cellphone accounts or fraudulent applications for government benefits. Some do offer limited insurance or help from a staffer trained to work with credit issuers and reporting agencies.

SOMEONE STOLE MY IDENTITY, WHAT DO I DO?

— The Federal Trade Commission recommends immediately notifying one of the credit agencies and requesting a 90-day credit alert. (Each reporting agency is supposed to notify the others, but you may want to contact all three yourself.) The alert tells businesses to contact you before opening any new accounts in your name. You can renew the alert every 90 days, or you're entitled to keep it in effect for seven years if you've filed an identity theft report with police.

— Contact the credit issuer to dispute fraudulent charges and have the bogus account closed.

— Request your credit report and ask the reporting agencies to remove bogus accounts or any incorrect information from your record. Consider asking the reporting agencies to place a full freeze on your credit. This blocks any business from checking your credit to open a new account, so it's a stronger measure than a credit alert. But you should weigh that against the hassle of notifying credit agencies to lift the freeze — which can take a few days — every time you apply for a loan, open a new account or even sign up for utility service.

— Submit a report through the FTC website: www.consumer.ftc.gov . Click the "privacy & identity" tab, which will walk you through creating an affidavit you can show to creditors.

— Keep copies of all reports and correspondence. Use certified mail to get delivery receipts, and keep notes on every phone call.

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