BERLIN (AP) — German authorities conducted a large-scale raid against an international human smuggling gang early Wednesday, police said in a statement.
More than 1,000 police officers searched dozens of homes, stores and offices across western and southern Germany and detained 10 suspects, including two lawyers.
A total of 38 suspected gang members, as well as 147 other people who allegedly paid to be smuggled by it, are being investigated, German news agency dpa reported. The two lawyers, 42 and 46 years old and from the Cologne area, are the main suspects, federal police in nearby Sankt Augustin said. The names of the suspects were not given, in line with German privacy rules.
The suspects are accused of having illegally taken advantage of special German immigration rules reserved for skilled foreign workers to obtain residency permits for around 350 mostly Chinese nationals — who don’t meet the needed criteria — in exchange for hundreds of thousands of euros (dollars).
Through their law firms, the two main suspects are said to have recruited wealthy foreign nationals for smuggling — mainly from China but also from Arab countries. Police said clients paid the law firms from 30,000 to 350,000 euros for illegal help with visas.
The suspected lawyers and their helpers allegedly used the money to set up fake companies, finance alleged residences and falsify alleged wage payments, keeping “not inconsiderable amounts” to enrich themselves, dpa reported.
The false residence permits were obtained from immigration offices in the western towns of Kerpen and Solingen, as well as Rhine-Erft and Dueren counties. One of the ten detained suspects is an city employee from Dueren, who was allegedly bribed to participate in the scam, dpa said.
Raids were carried out in the states of North Rhine-Westphalia, Schleswig-Holstein, Hesse, Rhineland-Palatinate, Baden-Wuerttemberg and Bavaria, Hamburg and Berlin where police seized assets and collected evidence.
“So far, extensive evidence and not inconsiderable assets have been secured, including around 210,000 euros in cash," the authorities said.
German Interior Minister Nancy Faeser thanked police and prosecutors for the “massive strike against international organized migrant smuggling.”
“In the fight against smuggling gangs, we need precisely this high level of investigative pressure and this consistent crackdown,” the minister added. “We will continue this tough approach against organized migrant smuggling.”
The investigation focused on North Rhine-Westphalia, where the 10 suspects were detained.
Police officers stand near a building that is being searched in Solingen, Germany, Wednesday April 17, 2024. The Duesseldorf public prosecutor's office has arrested ten suspects in a large-scale raid against an international smuggling gang in eight federal states. More than 1000 officers from the federal police and the public prosecutor's office have been involved in the operation since the early morning. A total of 101 residential and business premises were searched. (Gianni Gattus/dpa via AP)
NEW YORK (AP) — U.S. stocks swung to a mixed finish on Wednesday after the head of the Federal Reserve said the cuts to interest rates that Wall Street craves so much are still likely, even if they're delayed because of stubbornly high inflation.
The S&P 500 fell 17.30 points, or 0.3%, to 5,018.39 after the Fed held its main interest rate at its highest level since 2001, just as markets expected. The index had rallied as much as 1.2% in the afternoon before giving up all the gains at the end of trading.
The Dow Jones Industrial Average rose 87.37, or 0.2%, to 37,903.29, and the Nasdaq composite lost 52.34, or 0.3%, to 15,605.48.
On the downside for financial markets, Federal Reserve Chair Jerome Powell said out loud the fear that's recently sent stock prices lower and erased traders' hopes for imminent cuts to interest rates: “In recent months, inflation has shown a lack of further progress toward our 2% objective.” He also said that it will likely take "longer than previously expected” to get confident enough to cut rates, a move that would ease pressure on the economy and investment prices.
At the same time, though, Powell calmed a fear swirling in the market, that inflation has remained so high that additional hikes to rates may be necessary.
“I think it’s unlikely that the next policy rate move will be a hike,” he said.
The Fed also offered financial markets some assistance by saying it would slow the pace of how much it’s shrinking its holdings of Treasurys. Such a move could grease the trading wheels in the financial system, offering stability in the bond market. Powell said the Fed did it to reduce “risk of money markets showing stress.”
Yields eased in the bond market following the move and Powell's comments.
The yield on the 10-year Treasury fell to 4.63% from 4.65% just before the announcement, easing the pressure on the stock market. The yield on the two-year Treasury yield, which more closely tracks expectations for the Fed, dropped to 4.95% from 5.04% late Tuesday.
Traders themselves had already downshifted their expectations for rate cuts this year to one or two, if any, after coming into the year forecasting six or more. That's because they saw the same string of reports as the Fed, which showed inflation remaining stubbornly higher than forecast this year.
Powell had already recently hinted rates may stay high for a while. That was a disappointment for Wall Street after the Fed earlier had indicated it was penciling in three cuts to rates during 2024.
Powell's comments Wednesday were largely seen as less harsh than feared.
“Yet, before markets get overly excited, it’s worth remembering that the Fed is responding to the unfolding economic data, just as we all are,” according to Seema Shah, chief global strategist at Principal Asset Management. "The next few months of data are pivotal for the Fed path."
Without the benefit of easing rates, companies will need to deliver better profits to support their stock prices.
CVS Health tumbled 16.8% after reporting weaker results for the latest quarter than analysts expected. It said it’s been hurt by increased costs at its Medicare Advantage business, and it cut its forecast for profit over the full year.
Starbucks dropped 15.9% after falling short of expectations for both profit and revenue in the latest quarter. Sales trends weakened at its stores outside the United States in particular, and it cut its full-year forecasts for profit and revenue.
Super Micro Computer, which has been one of Wall Street’s hottest stars, gave back 14% despite topping expectations for profit. The company, which sells server and storage systems used in AI and other computing, fell shy of analysts’ forecasts for revenue. Expectations had bult up after its stock had already tripled this year amid a broad frenzy on Wall Street around artificial-intelligence technology.
Advanced Micro Devices dropped 8.9% despite reporting profit that matched expectations. Its revenue came in a bit shy of forecasts, as did the midpoint of its forecasted range for revenue in the current quarter.
On the winning side was Amazon, which climbed 2.3% after reporting stronger profit for the latest quarter than analysts expected. The retail behemoth credited reaccelerating growth at its cloud-computing business, in part, as it benefits from demand for AI.
Before the Fed's announcement, stocks and Treasury yields had been moving relatively little following some weaker-than-expected reports on the economy.
One report from the Institute for Supply Management said the U.S. manufacturing sector unexpectedly fell back into contraction last month.
A separate report said U.S. employers were advertising slightly fewer jobs at the end of March than economists expected. The hope on Wall Street has been that a cooldown could help prevent upward pressure on inflation. The downside is that if it weakens too much, a major support for the economy could give out.
Some recent economic reports raised fears about the potential for a stagnating economy combined with high inflation. The Fed doesn’t have great tools to fix such a scenario, called “stagflation.”
But Powell downplayed the risk of that and said inflation is much lower and economic growth is better than the last time stagflation struck in the 1970s and 80s.
“I don’t see the ‘stag’ or the ‘flation,’” he said.
AP Writers Matt Ott and Zimon Zhong contributed.
A banner for cruise operator Viking, marking its initial public offering, hangs on the front of the New York Stock Exchange on Wednesday, May 1, 2024 in New York. (AP Photo/Peter Morgan)
FILE - A person walks in front of an electronic stock board showing Japan's Nikkei 225 index at a securities firm in Tokyo, on April 22, 2024. Asian stocks fell Wednesday, May 1, 2024 with most of the markets in the region closed for a holiday. Meanwhile, U.S. stocks closed out their worst month since September. (AP Photo/Eugene Hoshiko, File)
FILE- A person looks at an electronic stock board showing Japan's stock prices at a securities firm in Tokyo, on April 30, 2024. Asian stocks fell Wednesday, May 1, 2024 with most of the markets in the region closed for a holiday. Meanwhile, U.S. stocks closed out their worst month since September. (AP Photo/Eugene Hoshiko, File)
