Pressure on Murdoch over new hacking allegation

LONDON | Tue Jul 5, 2011 7:12am EDT

LONDON (Reuters) - British Prime Minister David Cameron condemned the alleged hacking of a murdered schoolgirl's voicemail by the News of the World, part of Rupert Murdoch's media empire, as the scandal closed in on a top News Corp executive and Murdoch protegee.

That the prime minister should find time to comment while on a visit to troops in Afghanistan was a measure of the uproar at home over suggestions that the tabloid might have hampered police and added to the torment of the family of a 13-year-old, abducted in 2002, whose killer was convicted only last month.

Among those facing new questions about their conduct is Rebekah Brooks, now head of News Corp's British newspaper arm and editor of the newspaper at the time of the murder of schoolgirl Milly Dowler -- one of Britain's highest profile crimes in years.

Brooks has until now figured only indirectly in inquiries by police into the hacking of mobile phone mailboxes by journalists and investigators employed by the News of the World.

The escalation of the scandal comes at a key moment in parent company News Corp's planned multi-billion-dollar takeover of BSkyB, due to be approved by the government after a final consultation this week.

Cameron, speaking to journalists on a visit to Afghanistan, said on Tuesday: "On the question about the really appalling allegations about the telephone of Milly Dowler, if they are true, this is a truly dreadful act."

A lawyer for the Dowler family said on Monday he had learned from police that the schoolgirl's voicemail messages had been hacked while police were searching for her. [ID:nL6E71425S] Her killer, a man with a record of other sex attacks, was found guilty of her murder last week.

British media have said a newspaper investigator not only listened in to messages left on the teenager's phone after she went missing but may also have deleted some to make space for more -- potentially misleading police and giving false hope to her family that she was still alive and at liberty.

Brooks, the editor at the time, is now chief executive of News International, News Corp's British newspaper arm. Her successor at the News of the World Andy Coulson, an ex-spokesman for Cameron, resigned from the paper over the hacking affair in 2007 and this year quit Cameron's office as the scandal grew.

Cameron, who is close to Brooks and the Murdoch family, has been at pains to keep the hacking scandal separate from a government decision to approve News Corp's planned multi-billion-dollar takeover of satellite broadcaster BSkyB.

A final public consultation on the matter ends on Friday and is expected to result in a green light from the government, although the latest development has led to renewed calls from opposition politicians to halt the merger.

BSkyB shares traded down 0.6 percent at 845 pence by 0843 GMT, underperforming a flat European media index.

(Reporting by Georgina Prodhan; Editing by Alastair Macdonald)

Pressure on Murdoch over new hacking allegation (Reuters)

LONDON (Reuters) – British Prime Minister David Cameron condemned the alleged hacking of a murdered schoolgirl's voicemail by the News of the World, part of Rupert Murdoch's media empire, as the scandal closed in on a top News Corp executive and Murdoch protegee.

That the prime minister should find time to comment while on a visit to troops in Afghanistan was a measure of the uproar at home over suggestions that the tabloid might have hampered police and added to the torment of the family of a 13-year-old, abducted in 2002, whose killer was convicted only last month.

Among those facing new questions about their conduct is Rebekah Brooks, now head of News Corp's British newspaper arm and editor of the newspaper at the time of the murder of schoolgirl Milly Dowler -- one of Britain's highest profile crimes in years.

Brooks has until now figured only indirectly in inquiries by police into the hacking of mobile phone mailboxes by journalists and investigators employed by the News of the World.

The escalation of the scandal comes at a key moment in parent company News Corp's planned multi-billion-dollar takeover of BSkyB, due to be approved by the government after a final consultation this week.

Cameron, speaking to journalists on a visit to Afghanistan, said on Tuesday: "On the question about the really appalling allegations about the telephone of Milly Dowler, if they are true, this is a truly dreadful act."

A lawyer for the Dowler family said on Monday he had learned from police that the schoolgirl's voicemail messages had been hacked while police were searching for her. [ID:nL6E71425S] Her killer, a man with a record of other sex attacks, was found guilty of her murder last week.

British media have said a newspaper investigator not only listened in to messages left on the teenager's phone after she went missing but may also have deleted some to make space for more -- potentially misleading police and giving false hope to her family that she was still alive and at liberty.

Brooks, the editor at the time, is now chief executive of News International, News Corp's British newspaper arm. Her successor at the News of the World Andy Coulson, an ex-spokesman for Cameron, resigned from the paper over the hacking affair in 2007 and this year quit Cameron's office as the scandal grew.

Cameron, who is close to Brooks and the Murdoch family, has been at pains to keep the hacking scandal separate from a government decision to approve News Corp's planned multi-billion-dollar takeover of satellite broadcaster BSkyB.

A final public consultation on the matter ends on Friday and is expected to result in a green light from the government, although the latest development has led to renewed calls from opposition politicians to halt the merger.

BSkyB shares traded down 0.6 percent at 845 pence by 0843 GMT, underperforming a flat European media index.

(Reporting by Georgina Prodhan; Editing by Alastair Macdonald)

Regulators pressure banks after Citi data breach (Reuters)

NEW YORK (Reuters) – Major U.S. banks came under growing pressure from banking regulators to improve the security of customer accounts after Citigroup Inc became the latest high-profile victim of a cyber attack.

While Citigroup insisted the breach had been limited, experts called it the largest direct attack on a major U.S. financial institution, and said it could prompt an overhaul of the banking industry's data security measures.

The Federal Deposit Insurance Corp, the nation's primary regulator, is preparing new measures on data security. Its chairman Sheila Bair said on Thursday she may ask "some banks to strengthen their authentication when a customer logs onto online accounts."

Citigroup said late on Wednesday that computer hackers breached the bank's network and accessed the data of about 200,000 credit-card holders in North America. It would not discuss what new security measures Citi is taking.

The third-largest U.S. bank waited more than a month before making the full extent of the breach public, drawing criticism on Thursday from lawmakers and lawyers.

Citigroup is the latest in a growing list of companies that have suffered cyber attacks, including Sony, Google Inc and Lockheed Martin. The bank also has faced problems with customer security before. In April, a massive data breach at the email marketer Epsilon exposed the names and email addresses of customers at many large U.S. companies and banks, including Citigroup. And a 2008 attack on a Citigroup computer server let hackers withdraw at least $750,000 from the bank's cash machines in New York City.

Security experts said the latest attack may be a watershed moment for the U.S. banking industry, which until now has suffered fewer direct hacker attacks than retailers.

"We're getting to the tipping point in terms of the number of fraud cases," said Gartner Research security analyst Avivah Litan.

As regulators weigh whether to require more spending on security, "this could be the straw that breaks the camel's back," she said.

Citigroup spokesman Sean Kevelighan said on Thursday that the bank would replace "the majority" of the credit cards affected by the data breach. The bank said its attackers viewed the names of customers, account numbers and contact information, including e-mail addresses.

Citigroup said other information such as birth dates, social security numbers, card expiration dates and card security codes (CVV) were not compromised.

Debit cards were not affected, Kevelighan said Thursday.

The Financial Times reported on Wednesday that the bank discovered the breach in early May.

Kevelighan on Thursday told Reuters that once the bank became aware of the attack, "we immediately took steps to monitor the impacted customers accounts." But he would not further explain the bank's decision to delay making the breach public, citing security reasons.

DELAYED DISCLOSURE

Like Sony, which has declared several security breaches of its networks this year, Citi has already started to come under fire for not telling customers sooner.

Representative Mary Bono Mack is preparing legislation to ensure faster notification to customers, her spokesman told Reuters.

Representative Jim Langevin, who follows cyber issues closely, said that data breaches were a fact of life but that companies had to inform customers.

"I was shocked by the report that Citigroup knew that their customers' data was potentially exposed back in early May, but is only now, a full month later, informing the public about this threat to their personal information," he said in a statement.

Ira Rothken, a San Francisco-based attorney who represents plaintiffs in hacking cases, said his firm is investigating whether the information compromised in the Citi breach has led to any secondary intrusions against impacted customers.

"If a bank can't keep data secure, it's going to have a chilling effect not only on the banking industry, but on ecommerce," Rothken said.

Cyber attacks at banks could dampen customers' enthusiasm to pay for things online or with their phones. Many banks, including Citigroup, are trying to develop ecommerce and mobile payments projects in the hopes of generating more revenue from U.S. customers.

Other large U.S. banks have a better record of informing and helping customers whose data has been compromised, according to the payments consulting firm Javelin Strategy and Research. Bank of America Corp, Discover Financial Services and US Bancorp all scored higher than Citigroup a year ago when Javelin assessed how well the top U.S. lenders dealt with potential data compromises affecting their customers.

Banks' "strong preference is to handle things themselves and not get the customer involved until the bank believes that they've handled all the important parts" of the investigation," Javelin founder James Van Dyke said.

"I don't think that makes sense" when dealing with potential identity fraud, he said.

Kevelighan would not discuss how Citigroup's breach had occurred. Another Citi spokesman, James Griffiths in Hong Kong, said the breach had affected 1 percent of North American card customers, which the bank's annual report says total 21 million.

Banks can be particularly attractive targets for cyber criminals, Bair said on Thursday. "It's kind of a constant. It's one of the many risks that you have to deal with.

Federal banking regulators last updated their guidance on Internet banking security standards in 2005.

The regulators proposed an update to those standards in December 2010, saying they were "increasingly concerned that customer authentication methods implemented several years ago may no longer be effective ... (and) have also become aware that some institutions have failed to perform periodic risk assessments and update their control mechanisms appropriately."

Such updated standards would likely have more of an impact on small banks than on big financial companies, which already spend heavily on data security protection, said Aite Group analyst Julie Conroy McNelley.

But updated federal guidance for banks is "something that is long overdue," she said.

(Reporting by Maria Aspan; additional reporting by Ross Kerber in Boston, Diane Bartz in Washington and Dan Levine in San Francisco; editing by John Wallace, Gunna Dickson and Stella Dawson)

Regulators pressure banks after Citi data breach (Reuters)

NEW YORK (Reuters) – Major U.S. banks came under growing pressure from banking regulators to improve the security of customer accounts after Citigroup Inc became the latest high-profile victim of a cyber attack.

While Citigroup insisted the breach had been limited, experts called it the largest direct attack on a major U.S. financial institution, and said it could prompt an overhaul of the banking industry's data security measures.

The Federal Deposit Insurance Corp, the nation's primary regulator, is preparing new measures on data security. Its chairman Sheila Bair said on Thursday she may ask "some banks to strengthen their authentication when a customer logs onto online accounts."

Citigroup said late on Wednesday that computer hackers breached the bank's network and accessed the data of about 200,000 credit-card holders in North America. It would not discuss what new security measures Citi is taking.

The third-largest U.S. bank waited more than a month before making the full extent of the breach public, drawing criticism on Thursday from lawmakers and lawyers.

Citigroup is the latest in a growing list of companies that have suffered cyber attacks, including Sony, Google Inc and Lockheed Martin. The bank also has faced problems with customer security before. In April, a massive data breach at the email marketer Epsilon exposed the names and email addresses of customers at many large U.S. companies and banks, including Citigroup. And a 2008 attack on a Citigroup computer server let hackers withdraw at least $750,000 from the bank's cash machines in New York City.

Security experts said the latest attack may be a watershed moment for the U.S. banking industry, which until now has suffered fewer direct hacker attacks than retailers.

"We're getting to the tipping point in terms of the number of fraud cases," said Gartner Research security analyst Avivah Litan.

As regulators weigh whether to require more spending on security, "this could be the straw that breaks the camel's back," she said.

Citigroup spokesman Sean Kevelighan said on Thursday that the bank would replace "the majority" of the credit cards affected by the data breach. The bank said its attackers viewed the names of customers, account numbers and contact information, including e-mail addresses.

Citigroup said other information such as birth dates, social security numbers, card expiration dates and card security codes (CVV) were not compromised.

Debit cards were not affected, Kevelighan said Thursday.

The Financial Times reported on Wednesday that the bank discovered the breach in early May.

Kevelighan on Thursday told Reuters that once the bank became aware of the attack, "we immediately took steps to monitor the impacted customers accounts." But he would not further explain the bank's decision to delay making the breach public, citing security reasons.

DELAYED DISCLOSURE

Like Sony, which has declared several security breaches of its networks this year, Citi has already started to come under fire for not telling customers sooner.

Representative Mary Bono Mack is preparing legislation to ensure faster notification to customers, her spokesman told Reuters.

Representative Jim Langevin, who follows cyber issues closely, said that data breaches were a fact of life but that companies had to inform customers.

"I was shocked by the report that Citigroup knew that their customers' data was potentially exposed back in early May, but is only now, a full month later, informing the public about this threat to their personal information," he said in a statement.

Ira Rothken, a San Francisco-based attorney who represents plaintiffs in hacking cases, said his firm is investigating whether the information compromised in the Citi breach has led to any secondary intrusions against impacted customers.

"If a bank can't keep data secure, it's going to have a chilling effect not only on the banking industry, but on ecommerce," Rothken said.

Cyber attacks at banks could dampen customers' enthusiasm to pay for things online or with their phones. Many banks, including Citigroup, are trying to develop ecommerce and mobile payments projects in the hopes of generating more revenue from U.S. customers.

Other large U.S. banks have a better record of informing and helping customers whose data has been compromised, according to the payments consulting firm Javelin Strategy and Research. Bank of America Corp, Discover Financial Services and US Bancorp all scored higher than Citigroup a year ago when Javelin assessed how well the top U.S. lenders dealt with potential data compromises affecting their customers.

Banks' "strong preference is to handle things themselves and not get the customer involved until the bank believes that they've handled all the important parts" of the investigation," Javelin founder James Van Dyke said.

"I don't think that makes sense" when dealing with potential identity fraud, he said.

Kevelighan would not discuss how Citigroup's breach had occurred. Another Citi spokesman, James Griffiths in Hong Kong, said the breach had affected 1 percent of North American card customers, which the bank's annual report says total 21 million.

Banks can be particularly attractive targets for cyber criminals, Bair said on Thursday. "It's kind of a constant. It's one of the many risks that you have to deal with.

Federal banking regulators last updated their guidance on Internet banking security standards in 2005.

The regulators proposed an update to those standards in December 2010, saying they were "increasingly concerned that customer authentication methods implemented several years ago may no longer be effective ... (and) have also become aware that some institutions have failed to perform periodic risk assessments and update their control mechanisms appropriately."

Such updated standards would likely have more of an impact on small banks than on big financial companies, which already spend heavily on data security protection, said Aite Group analyst Julie Conroy McNelley.

But updated federal guidance for banks is "something that is long overdue," she said.

(Reporting by Maria Aspan; additional reporting by Ross Kerber in Boston, Diane Bartz in Washington and Dan Levine in San Francisco; editing by John Wallace, Gunna Dickson and Stella Dawson)

Popular Blood Pressure Meds Not Linked to Cancer, FDA Says (HealthDay)

THURSDAY, June 2 (HealthDay News) -- A class of drugs widely used to treat high blood pressure doesn't boost the risk of cancer, as a recent analysis suggested, U.S. health authorities announced Thursday.

The drugs are known as angiotensin-receptor blockers (ARBs) and include medicines such as telmisartan (Micardis), losartan (Cozaar), valsartan (Diovan) and candesartan (Atacand).

The determination comes from the U.S. Food and Drug Administration (FDA), which just concluded a safety review of the drugs.

"It is comforting to have this data to support what we clinically felt was true," said Dr. Joseph Diamond, director of nuclear cardiology at Long Island Jewish Medical Center in New Hyde Park, NY.

FDA undertook the review after a meta-analysis appearing in July 2010 in The Lancet found a "modestly increased risk" -- about 10 percent -- of cancer diagnoses among people taking ARBs, and a smaller increased risk of death from cancer.

Until that report, there had been very little concern about the safety of the drugs.

"It's a drug that's been out for a very long time so we have a lot of clinical experience with it," Diamond said.

In fact, he added, many physicians were skeptical when the Lancet findings were first announced. "That study really was not designed to look for cancer," he said.

Dr. Cheryl Laffer, an associate professor of internal medicine in the Texas A&M Health Science Center College of Medicine, said that she and other physicians weren't worried when that study came out, but many patients were.

"The ARBs are probably the most widely used class of medications for patients with high blood pressure," said Diamond. "They're used in patients with general hypertension and particularly in patients who may have hypertension with diabetes or hypertension with kidney disease."

The drugs are given once a day and have some added benefit in protecting the kidneys from the ravages of high blood pressure and diabetes, he added.

"They're better tolerated than ACE inhibitors [another type of blood pressure medication]" but have the same effect, said Laffer, who is also senior staff of medicine/hypertension at Scott & White in Temple. "Their side effect profile is no bigger than placebo."

The FDA review looked at 31 trials involving a total of more than 155,000 patients who had been randomized to receive either ARBs or another hypertension treatment.

As far as Laffer is concerned, the FDA report is definitive. "I think they did their job. They looked at all analyses which had used ARBs as compared to anything and they found no overall increased risk. They looked at hundreds of thousands of people," she said.

More information

The American Heart Association has more on blood pressure medications.

Jailed IMF chief under pressure to quit (Reuters)

NEW YORK/WASHINGTON (Reuters) – Dominique Strauss-Kahn faced growing pressure to quit as head of the IMF after his arrest on attempted rape charges, and Europe sought to fend off a challenge from developing countries to fill a post it has traditionally held.

China, Brazil and South Africa questioned Europe's right to the job but Europeans said it made sense for them to retain the post while the International Monetary Fund plays such a crucial role in helping to ease the euro zone debt crisis.

Strauss-Kahn is expected to remain in New York's Rikers Island jail, known for its gang violence, at least until his next appearance in court on Friday, when his lawyers may again request bail. He was denied bail on Monday.

It could be six months before a trial begins, legal experts said, which could severely impair his ability to run the Fund.

The IMF said it had not been in touch with Strauss-Kahn since his arrest but it would be important to do so "in due course." Two IMF board sources told Reuters the board would ask Strauss-Kahn whether he planned to continue in his post.

One source said it would be ideal if Strauss-Kahn resigned, but the second said that sentiment was not shared across the 24-member board, which has the authority to remove him.

Strauss-Kahn is accused of trying to rape a maid who came to clean his luxury suite at the Sofitel hotel in Manhattan on Saturday. His lawyer has said he will plead not guilty. If convicted, he could face 25 years in prison.

In the United States, the IMF's biggest shareholder, politicians began questioning the viability of his tenure as head of the institution charged with managing the world economy and central to negotiating debt crisis deals.

"I can't comment on the case, but he is obviously not in a position to run the IMF," U.S. Treasury Secretary Timothy Geithner said.

John Lipsky, the second-in-command, is in charge during Strauss-Kahn's absence, but no formal interim chief has been named. IMF sources told Reuters that David Lipton, White House international economic adviser and former deputy treasury secretary, would take Lipsky's deputy position.

Strauss-Kahn's arrest has thrown the IMF into turmoil just as it is helping euro zone states like Greece and Portugal tackle debt woes.

Senate Foreign Relations Committee Chairman John Kerry stopped short of calling for Strauss-Kahn's resignation, but he called the circumstances of the case "troubling if not damning."

"If the evidence is what it appears to be, I think it would be very difficult for him to manage," Kerry said.

In Europe, Strauss-Kahn was also losing support.

"Given the situation, that bail has been denied, he has to consider that he would otherwise do damage to the institution," said Austrian Finance Minister Maria Fekter.

Spanish Economy Minister Elena Salgado cast doubt on Strauss-Kahn's judgment but said it was his decision whether to resign.

"That is a decision which is up to Mr Strauss-Kahn to take, but the crimes he is accused of are very serious ... My solidarity first and foremost is with the woman who suffered the attack, if that was what happened," she told reporters.

EUROPEAN JOB

A European has held the post of managing director since the IMF was created in 1945, and four of them have been Frenchmen.

European Commission President Jose Manuel Barroso told Dutch television on Monday he did not want to speculate about replacing Strauss-Kahn, but added: "If a succession is necessary, European countries should present a candidate."

But emerging countries are starting to flex their muscle over who should succeed him. He had been expected to leave soon anyway to run for French president.

China said on Tuesday the selection of the next IMF boss should be based on "fairness, transparency and merit."

It marked the first time that China, the fund's third largest member, weighed in early and so publicly on an IMF selection debate.

South African Finance Minister Pravin Gordhan and a senior Brazilian government official, who asked not to be named, said the next chief should be from a developing country, pressing a case to give emerging economies a greater say in world affairs.

But Brazilian Finance Minister Guido Mantega said the Strauss-Kahn affair should not be used as a way to press for changes in the way the IMF head is picked, telling GloboNews TV the discussion "is too premature at this point."

"I am all appalled by this situation and I really hope that the situation gets resolved so Dominique can return -- he is probably one of the best IMF chiefs that we had in the past years," Mantega said.

German Chancellor Angela Merkel said on Monday the Fund's role in tackling the euro zone crisis meant it made sense for Europe to keep the job, although the post could go to the developing world in the future.

French Finance Minister Christine Lagarde is thought to be interested in the post but her prospects have been clouded by a decision this month by a public prosecutor to recommend a full-scale inquiry into her role in awarding financial compensation to a prominent businessman in 2008.

SOCIALIST SOLIDARITY IN FRANCE

French President Nicolas Sarkozy urged members of his center-right party to show "restraint and dignity" and refrain from comment on the case, participants at a breakfast meeting said.

Socialists, stunned by the arrest of their leading candidate to challenge Sarkozy for the presidency next year, vowed to stick to their timetable to select a candidate by October.

Many have been outraged by the way New York police paraded Strauss-Kahn -- handcuffed and unshaven -- before the world's media before he had been able to defend himself in court.

Former Culture Minister Jack Lang called the treatment a "lynching" that had "provoked horror and aroused disgust." Other senior Socialists said it violated his right to be presumed innocent until found guilty by a court.

New York Mayor Michael Bloomberg agreed such a display was humiliating and would be unfair if a defendant were to be found innocent. "But if you don't want to do the perp walk, don't do the crime," he told reporters.

"I don't have a lot of sympathy for that. Our judicial system works where the public can see the alleged perpetrators."

The lawyer for the alleged victim, 32, said she was traumatized and in hiding. He said she was a widow with a 15-year-old daughter, who moved to New York from the West African nation of Guinea about seven years ago, he said.

"She didn't have any idea who he was or have any prior dealings with this guy (Strauss-Kahn)," Jeffrey Shapiro, a New York personal injury lawyer, told Reuters.

(Additional reporting by Philip Blenkinsop in Brussels; writing by Jon Boyle; Editing by Elizabeth Piper)

IMF chief faces growing pressure over sex charges (AFP)

NEW YORK (AFP) – IMF chief Dominique Strauss-Kahn, jailed in New York for alleged sexual assault, faced growing pressure Wednesday after a top US official cast doubt on his ability to lead the world lender.

"He's obviously not in the position to run the IMF," US Treasury Secretary Timothy Geithner said in his first public comments on the case, which could see Strauss-Kahn, once a favorite for France's presidency, spend years behind bars.

Strauss-Kahn, who has denied all charges and is spending his second night in New York City's notorious Rikers Island jail complex, faces a long prison sentence if convicted.

IMF spokesman William Murray said the Washington-based organization has not been in touch with Strauss-Kahn since his arrest in the first-class section of an Air France jet Saturday afternoon.

"We are aware of widespread speculation about the managing director?s status," he added.

Strauss-Kahn is accused of sexually assaulting a maid who entered his room at the posh Sofitel Hotel believing it was empty.

The 62-year-old allegedly emerged from the shower naked and tried to force himself on the woman, who was eventually able to fend off the attacks and run out of the room.

The 32-year-old woman has not been identified, and has not spoken publicly about the alleged incident. But her lawyer, Jeff Shapiro, told CNN that his client was suffering from "extraordinary" trauma.

On Monday, a judge refused to grant bail to the head of the International Monetary Fund, saying he posed a flight risk because he might try to escape to France. A new court hearing is due Friday.

A grand jury is due to convene to decide whether there is enough evidence in the accusations to proceed to trial. Such proceedings are secret, and the Manhattan District Attorney's office would not comment on progress.

Meanwhile, a man who says he is the maid's brother said she was in tears after the alleged assault.

"Something bad just happened. She was crying. She did not stop crying," said the man, whom AFP did not name to protect the identity of the maid.

"She was completely devastated. She was with the doctor and the police when she called me on Saturday afternoon," the man said, adding that his sister was a Muslim and did not know her alleged attacker.

He was also widely seen as the man who could unseat President Nicolas Sarkozy in 2012 elections.

Now he occupies a single cell on Rikers Island, along with thousands of other detainees, most of them too poor to afford their bail and a few, like Strauss-Kahn, who are considered a flight risk.

In France, Strauss-Kahn continues to enjoy some support, including from conspiracy theorists who claim he was set up. A poll said Wednesday that 57 percent of French people believe he is the "victim of a plot."

Prime Minister Francois Fillon, however, the most senior French official to publicly weigh in on the case, was quoted as saying there could be "no excuse" if the allegations were true, and that it would be "a very serious act."

Strauss-Kahn's lawyers have promised a "vigorous" defense.

During the bail hearing, the chief line of defense centered on assertions that Strauss-Kahn did not try to flee the country as alleged, and that he went out to lunch immediately after the time of the alleged crime.

This timeline, lawyers say, indicates that he had nothing to hide and was not in a panic, as police and prosecutors have suggested.

Another possible defense would be that the alleged sexual encounter was consensual, according to New York Post tabloid, which quoted a "source close to the defense" as saying "there may well have been consent."

In court, lawyer Ben Brafman said the evidence "will not be consistent with a forcible encounter," without elaborating, and another member of the defense team declined to comment on the Post report.

Prosecutors say they have physical evidence, including a doctor's exam made immediately after the incident indicating attempted rape.

Tanks storm south Syria city as U.S. piles on pressure (Reuters)

AMMAN (Reuters) – The West warned of more pressure on Syria on Tuesday if a crackdown against pro-democracy protests continues, hours after tanks stormed a city in the south, cradle of an uprising against Baathist rule.

Secretary of State Hillary Clinton said that both the European Union and the United States -- which have already slapped sanctions on a number of senior Syrian officials but not on President Bashar al-Assad -- were planning more steps.

"We will be taking additional steps in the days ahead," Clinton said, saying she agreed with European Union foreign policy chief Catherine Ashton, who told reporters that the time for Syria to make changes was now.

Rights activists say a crackdown to crush a two-month wave of protests against Assad has killed at least 700 civilians.

Syrian tanks moved into a southern city in the Hauran Plain on Tuesday after encircling it for three weeks, activists said.

Soldiers fired machineguns in the air as tanks and armored personnel carriers entered Nawa, a city of 80,000 people 60 km (40 miles) north of the southern town of Deraa, according to activists from the region.

"The troops are now combing neighborhoods in Nawa and arresting scores of men," one activist said.

In Deraa, tanks remained in the streets after the old quarter was shelled into submission last month and residents gave accounts of mass graves which the authorities denied.

The southern towns of Inkhil and Jassem remained also besieged, rights campaigners said, adding that mass arrests continued in the Hauran Plain and other regions of Syria.

Assad had been partly rehabilitated in the West in the last three years, but the use of force to quell dissent in the last two months has reversed that trend.

The United States had condemned the crackdown as "barbaric."

French Foreign Minister Alain Juppe said on Tuesday France and Britain were close to getting nine votes for a resolution on Syria at the U.N. Security Council, but Russia and China were threatening to use their veto.

Half of Kuwait's 50 lawmakers urged the Gulf Arab state on Tuesday to cut ties with Syria and expel its ambassador in protest at the violence to crush the protests.

Villagers near Deraa have found two separate graves containing up to 26 bodies, residents said on Tuesday, but Syrian authorities dismissed such reports as part of "campaign of incitement" that targeted the country.

Four residents told Reuters that villagers had contacted the local civil defense after noticing two mounds of earth in wheatfields just outside Deraa's old city district. Under the mounds were 22 to 26 decomposed corpses, they said.

Their reports could not be verified because authorities have barred most international media from operating in Syria.

Since Assad sent tanks into Deraa three weeks ago, the army has moved into several other protest centers in the south, around the capital Damascus and on the Mediterranean coast.

The government blames most of the violence on armed groups backed by Islamists and outside powers, saying they have also killed more than 120 soldiers and police.

Soldiers moved on Saturday into the town of Tel Kelakh, close to Lebanon's northern border.

Human rights campaigners said scores of people had been arrested since Monday and that Assad's forces were firing at several neighborhoods in the city of 30,000 people.

Citing witnesses, the Local Coordination Committees, an activists' group, said several people were killed in Tuesday's offensive, adding to 12 civilians already killed by army shelling, shooting and sniper fire in the last three days.

A Reuters correspondent on the Lebanese side of the border heard shooting and could see smoke rising from the village of Arida, which lies between Tel Kelakh and the border.

"They destroyed the houses, they cut electricity and water. The wounded are dying in our hands and the dead are strewn on the streets," a Tel Kelakh resident told Reuters by telephone.

She said she was hiding in a basement with seven families.

State news agency SANA said security forces clashed with "wanted armed terrorist members" in Tel Kelakh on Monday, killing several and capturing others, and seizing weapons, ammunition and military uniform. Fifteen members of the security forces were wounded, it quoted a military source as saying.

In her stone house just a few meters inside Lebanese land, Umm Fatima said she had sent her nine children to the nearby village of Wadi Khaled for safety.

"All night and day, there's gunfire. I'm so scared it will reach our homes -- I don't dare leave my home," she said.

The Syrian Observatory for Human Rights said there were also mass arrests in the cities of Homs, Deir al-Zor and Latakia, which security forces had "robbed of normality."

Assad has tried a mixture of reform and repression to stem the protests, inspired by uprisings across the Arab world.

Authorities say he intends to launch national dialogue talks, a gesture rejected by opposition leaders and the main activists' protest group who say security forces must first stop shooting protesters and political prisoners must be freed.

The Facebook page Syria Revolution 2011 called for a general strike across Syria on Wednesday.

(Additional reporting by Yara Bayoumy in Wadi Khaled, Lebanon, and Khaled Yacoub Oweis in Amman; Writing by Dominic Evans; Editing by Diana Abdallah)