MADISON, Wisconsin (Reuters) – Wisconsin's Republican governor vowed on Friday to press ahead with legislation to curb the union bargaining rights of public employees as part of a deficit-cutting plan even as protests against the measure swelled.

Speaking at a news conference on the fifth consecutive day of demonstrations against the proposal, Governor Scott Walker said the state is broke and cannot pay its bills unless the plan is approved.

"I told the voters what I would do to get Wisconsin working again," Walker said of his election in 2010. "We are going to do what it takes to get this budget on track."

Republicans have majorities in both the state Senate and the Assembly. In a bid to scuttle the proposal, Senate Democrats fled the state on Thursday and Friday to deprive the Senate of the needed quorum for a vote.

The lawmakers apparently left the state because they were concerned that they would be compelled to return to the Capitol by police if they stayed in Wisconsin.

Republicans have a quorum in the state Assembly and could pass the plan there over the weekend.

Police estimated that 35,000 protesters converged on the Capitol grounds in Madison on Friday, with another 5,000 demonstrators packed inside the building itself, said Carla Vigue, a spokeswoman with the Wisconsin Department of Administration.

On Thursday, a crowd estimated at 30,000 people protested inside and outside the Capitol building.

The protests have so far been peaceful and police said there were no incidents or arrests on Friday.

TEA PARTY

But the potential for confrontation emerged when the conservative Tea Party movement, which supports deep budget cuts, announced that it would hold a rally supporting the Republicans at the Capitol on Saturday.

Drew Ryun, the president of American Majority Action, one of the conservative groups planning Saturday's demonstration, said organizers were "meeting fire with fire."

"We have buses coming in from all over the state," Ryun said. "We see this as the opening salvo of the 2012 election season. The Tea Party movement facing off against the unions. And we like the odds."

Wisconsin is the flashpoint for a national struggle over efforts to roll back pay and union rights of state and local government workers. If the majority Republicans in Wisconsin prevail, other states could be emboldened to take on powerful public employee unions.

The Milwaukee Public School system, which serves 85,000 students in the state's largest city, canceled all classes on Friday after nearly 630 unionized teachers called in sick.

"Every day the crowds are bigger," said Jay Heck, the executive of Common Cause Wisconsin, a non-partisan advocacy group based in Madison, said of the union protests.

President Barack Obama sided with the demonstrators on Thursday, calling the governor's proposal an "assault on unions." U.S. House of Representatives Speaker John Boehner criticized Obama and said he backed fellow Republican Walker.

Walker's administration puts the deficit for the remainder of the current fiscal year at $137 million and for the next two fiscal years under its biannual budget at $3.3 billion.

Republicans want state workers to increase contributions to pensions to 5.8 percent of salary, and double contributions to health insurance premiums to 12.6 percent.

They also want to limit collective bargaining to the issue of wages, and cap increases to the rate of inflation, with a voter referendum needed for bigger increases.

Walker said the alternative is to layoff more than 10,000 workers.

Walker was to unveil his state budget proposal for the next two fiscal years on February 22, but on Friday his office said that speech would be put off until March 1.

U.S. state and local governments are struggling to balance budgets after the recession decimated their finances. Some states such as Wisconsin, Texas, Arizona and Ohio are relying mainly on cuts in spending to balance the books. Others such as Minnesota and Illinois are raising taxes.

(Additional reporting by Vickie Allen in Washington, Darren Hauck in Madison, John Rondy in Milwaukee and Andrew Stern, James Kelleher and Karen Pierog in Chicago; Editing By Greg McCune and Eric Beech)

MOGADISHU (Reuters) – Pirates have hijacked a yacht with four Americans on board off the coast of Oman, a regional maritime expert and an advocacy group monitoring piracy in the Indian Ocean said on Saturday.

"The S/V Quest was attacked by pirates in the Indian Ocean and the four Americans on board are being held hostage," advocacy group Ecoterra said in a statement.

Ecoterra said the 58-foot yacht was owned by Jean and Scott Adam. It was not immediately clear if the couple were sailing the yacht at the time of the attack.

Pirate gangs in the Indian Ocean are making tens of millions of dollars in ransoms, and despite successful efforts to quell attacks in the Gulf of Aden, international navies have struggled to contain the piracy owing to the vast distances involved.

The couple began their world trip in 2004, according to their website.

An U.S. official in Nairobi declined to comment and said the Pentagon Public Affairs was handling press enquiries.

East African maritime expert Andrew Mwangura said the yacht was sailing from India to Salalah in Oman when the sea-bandits struck on Friday afternoon.

(Editing by Richard Lough)

SEATTLE (Reuters) – Convicted "Green River Killer" Gary Ridgway pleaded guilty on Friday to his 49th murder charge, after being shouted down in court by a man in the audience as he tried to apologize.

Ridgway, who is considered the nation's most prolific serial killer, spoke in a hoarse voice as he entered the guilty plea on his 62nd birthday, admitting that he killed 20-year-old Rebecca Marrero, who was last seen alive on December 3, 1982.

Under a plea deal Ridgway made in 2003, he was spared the death penalty in exchange for confessing to all of the murders linked to him at the time or any that were later discovered.

Ridgway, who is serving a life prison term without the possibility of parole, had previously confessed to Marrero's murder but prosecutors said at the time that they didn't have enough evidence include her killing in the plea deal.

The convicted killer started to apologize in court on Friday for Marrero's murder, but was cut off when an unidentified man sitting with the victim's family began shouting obscenities at him.

The victim's sister, Mary Marrero, her 79-year-old mother standing shakily at her side, told King County Superior Court Judge Mary Roberts that her family has been devastated by the murder and wished that Ridgway faced the death penalty.

"The day she came up missing I wanted to kill myself," Mary Marrero said, her voice breaking. "I still feel that today ... There is so much anger. What does it take to get the death penalty in the state of Washington? I do not agree with this plea deal."

"If I had one thing to ask today, it would be to kill him," she said.

"I appreciate you are not content with the outcome of this case," Roberts said to Marrero's family. "But I hope find some justice in it."

Ridgway has confessed to nearly 70 murders, most of his victims young female prostitutes or runaways. He was dubbed the Green River killer because the bodies of several of his victims in the early 1980s were found in or near the river, which runs through south King County.

Marrero's skeletal remains were found by teenagers December 23 of last year.

Rebecca Marrero, the mother of a 3-year-old girl, was last seen alive leaving a motel near the Seattle-Tacoma Airport.

(Editing by Dan Whitcomb)

DETROIT (Reuters) – Sixty-four former Chrysler dealers sued the U.S. government on Thursday, saying the Obama administration violated their rights by closing their stores during the automaker's bankruptcy without compensation.

The dealers said they were due "at least $130 million" in damages from the shutdown of their stores, according to a complaint filed with the U.S. Court of Federal Claims in Washington.

In court papers, dealers said the termination of those stores helped stabilize the U.S. economy and prevented the disruption of the American auto industry.

"This is a loss that should not, however, be borne by a few individual auto dealers but ... must in fairness and justice be borne by the public as a whole," dealers said in court papers.

Chrysler filed for bankruptcy in April 2009. It sent termination notices to 25 percent of its dealers -- or 789 stores -- as part of its U.S. government-funded restructuring in May 2009.

The Treasury Department declined to comment. In May 2009, Treasury said the store closures were "necessary" to help Chrysler rebound from its near-collapse and said it played no role in deciding which and how many dealers would close.

In court papers filed Thursday, the dealers said the U.S. government leveraged its authority under the Troubled Asset Relief Program to skirt state franchise laws designed to protect dealers.

Dealers said they spent millions on training, inventory and marketing to help sell Chrysler vehicles. For example, a group of four dealers in Maryland spent nearly $9 million to revamp their facilities and make other changes.

The dealers came from 29 states across the country including California, New York and Texas, according to the complaint.

Chrysler is now 25-percent owned and managed by Italy's Fiat SpA.

(Reporting by Deepa Seetharaman; Editing by Richard Chang)

WASHINGTON (Reuters) – The U.S. government on Thursday charged 111 doctors, nurses and other defendants with Medicare crime schemes that exceeded $225 million in false billings, the largest health care fraud crackdown so far.

Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius announced the charges in the latest of a series of cases brought by the Obama administration as health care fraud has emerged as an important political issue.

About 45 million elderly and disabled Americans are enrolled in taxpayer-funded Medicare plans, which have come under fire from critics who say the government pays too much to the companies running them and that they are subject to fraud.

Medicare reform represented a key part of the sweeping year-old health care law championed by Democratic President Barack Obama, but opposed by many Republicans in Congress.

The latest charges covered defendants in nine cities. In addition to arrests, law enforcement agents also executed 16 search warrants.

The defendants were charged various crimes, including conspiracy to defraud the Medicare program, false claims, kickbacks and money laundering, administration officials said.

They said the alleged schemes involved various medical treatments, tests and services, such as home health care, physical and occupational therapy and medical equipment.

"Although today marks a critical step forward in combating and deterring illegal activity, our work is far from over," Holder said. Fraud has accounted for as much as an estimated $60 billion a year in the Medicare program.

A top FBI official, Shawn Henry, said 2,600 health care fraud cases were under investigation and that organized crime groups have been increasingly linked to the alleged schemes.

Sebelius said $4 billion was recovered last year, and the government's Medicare Fraud Strike Force was recently expanded to nine cities, with the addition of Dallas and Chicago.

(Reporting by James Vicini; Editing by Cynthia Osterman)

NEW YORK (Reuters) – New York City Mayor Michael Bloomberg on Thursday unveiled a $65.6 billion budget plan for fiscal year 2012 that calls for firing 4,666 teachers and reducing capital spending 10 percent over the next decade.

Bloomberg blamed an approximately $4.4 billion reduction in aid from the state and the U.S. government for painful cuts that have already provoked a clash with school teachers and are certain to draw opposition from other public sector unions.

"The future does have some clouds," Bloomberg, a political independent, told a news conference.

New York City has withstood the recession better than many cities across the country, in part because Wall Street rebounded quickly from the 2008 financial crisis. For the second year in a row, Bloomberg has cut spending. The new budget plan is $300 million less than the current budget.

Bloomberg said the city was creating jobs at a faster rate than the rest of the country, had benefited from a record 48.7 million visitors in 2010, and that its commercial real estate market remained the strongest in the country.

That should help lead to an additional $2 billion in revenue over the next year half than previously forecast.

Even so, the city plans to lay off 4,666 of its 75,000 public school teachers and reduce a further 1,500 teaching jobs by attrition. Another 1,000 to 1,300 workers at other city agencies also will lose their jobs.

Bloomberg said his plan, which requires City Council approval, closes a $4.58 billion budget deficit without tax or fee increases.

Capital spending, which is separate from the operating budget and financed largely by borrowing, would be cut 10 percent over the next decade, realizing savings of about $6 billion. Bloomberg said he had considered a 20 percent cut but was talked out of it by City Council Speaker Christine Quinn.

Quinn, a Democrat, said she might try to restore some programs after Bloomberg proposed cuts in aid to disabled children, subsidies for adoptions, services for juveniles and the homeless.

The budget battle is a prelude to a separate conflict over which teachers to fire. Bloomberg wants those decisions made on merit rather than seniority but the state would have to agree.

"His complete insistence on teacher layoffs seems bizarre to us at this point. We think it's more of a political game and scaring people," Michael Mulgrew, president of the United Federation of Teachers, told NY1 television.

Bloomberg suggested he was free to take on public-sector unions now that he no longer will seek re-election.

"I have nothing to lose, I suppose is a nice way to phrase it," the billionaire mayor said.

"These are problems that never get solved because there is no short-term benefit to solving them. But that's why I ran for a third term," he said.

The mayor also pleaded with state legislators in Albany to allow him to negotiate pension benefits with city employees in order to slow growth in the city's contribution to the pension funds, which he said would otherwise increase from $7 billion this year to $8.4 billion next year.

City workers negotiate those benefits with the state.

(Reporting by Joan Gralla; Writing by Daniel Trotta; Editing by Chizu Nomiyama)

NEWARK, New Jersey (Reuters) – When a New Jersey family with an autistic child walks into the state office seeking help, Norlande Perpignan is often the first person they see.

A clerk making $41,082 a year at the Division of Developmental Disabilities, Perpignan, 40, is also on the front lines of a national debate about public spending, taxes and a fiscal crisis facing local governments.

With the sluggish economy constricting tax revenue, many states, counties and local governments are fiscally distressed, adding unprecedented volatility to the traditionally safe, $2.8 trillion municipal bond market.

New Jersey Governor Chris Christie has called the state's long-term pension obligations "fairy tale promises" that are unsustainable," saying the state's unfunded pension liabilities -- $46 billion and growing -- threaten the system with collapse.

As a result, state worker benefits are being targeted by budget-cutting politicians and resentful taxpayers whose defined benefit pensions disappeared a generation ago and whose retirement savings shrank in the financial crisis.

But state workers of modest means are asking why they are being asked to pay for the mistakes of Wall Street, which inflated the bubble with easy credit and big bets on risky mortgages and then got bailed out with hundreds of billions of dollars in taxpayer money after the crash of 2008.

"There's more stress because you don't know when they're going to call you in and give you a pink slip (dismissal notice)," said Perpignan, a single mother and 20-year employee suddenly faced with reduced benefits. "I'm always stressed, wondering if 20 years means anything to them. I have a child in college plus two other kids."

Christie, whose aggressive budget-cutting has made him a national star in the Republican Party, wants to help balance the budget by paring the benefits of employees like Perpignan.

Without reform, New Jersey's unfunded pension liabilities would grow to $181 billion in 30 years, he says.

PENSION POLITICS

Under Christie's plan, Perpignan would pay an extra $5,700 a year in contributions toward her pension and health care benefits -- another 14 percent of her pretax salary -- on top of the $2,875 she pays now.

In addition, she would have to work another 10 years before retiring -- at age 65 instead of 55 -- and would collect a $15,800 annual pension, nearly $3,000 less than what she has been promised since she was hired 20 years ago.

Public sector workers recognize that they often have more secure retirement plans than their private sector counterparts and reputations as lazy underperformers who have been rewarded by politicians courting favor with public-sector unions.

They may suffer from association with cases of politicians collecting generous pensions despite being convicted of crimes.

Some of them are fighting back.

"Even if you are at your worst, you have to try your best, because there are families coming in, and there's nothing else you can do but be your best and greet them with dignity," Perpignan said.

A DEAL IS A DEAL

Many pensioners who retired under one set of rules are now facing reductions years after they stopped working. Their unions typically negotiated more modest salary packages in exchange for better retirement benefits.

"It's ridiculous the way they're attacking the pensions," said Dennis Ahern, 69, a retired New York City transit police officer who had a gun pulled on him twice and lost seven friends who were killed on the job. "They have us on the beach of Bermuda because we have a pension. No. You're paying your bills. I live modestly. I can buy a Hyundai."

In 21 years on the job, Ahern said he never made more than $36,000 a year and retired in 1987. He collects a pension of $26,000 a year plus a variable supplement that amounted to $12,000 last year. Mayor Michael Bloomberg wants to eliminate that supplement.

"That isn't fair. That wasn't the agreement. It wasn't a bonus. We paid for it. It was negotiated. It's fair and square," Ahern said.

Christie last year skipped a $3 billion payment to the fund, meaning the contribution will have to be made up in the future or asset prices will have to rise dramatically for the fund to meet future obligations to pensioners.

Critics fault a series of governors who chose not to make employer contributions.

"What really is at issue here is an ideological theory that says that the individual should take care of his retirement economic security and any pooling of resources into a pension fund is ideologically unacceptable," said Denis Hughes, president of the New York State AFL-CIO and a former chairman of the Federal Reserve Bank of New York's board of directors.

"Private sector employees had defined benefit pension funds for many years and they suffered the same problem that the public sector has now, where employers didn't fund them."

(Additional reporting by Joan Gralla; Editing by Eric Walsh)

NEW YORK/WILMINGTON, Delaware (Reuters) – Borders Group Inc filed for bankruptcy protection and said it would close about one-third of its bookstores, after years of shriveling sales that made it impossible to manage its crushing debt load.

The long-expected Chapter 11 filing will give the second-largest U.S. bookstore chain a chance to try to fix its finances and overhaul its business in an attempt to survive the growing popularity of online bookbuying and digital formats.

But the chain still faces questions about its longer-term survival in the face of competition from larger rival Barnes & Noble Inc and discounters such as Wal-Mart Stores Inc and Costco Wholesale Corp, as well as from Web retailer Amazon.com Inc and from Apple Inc in electronic books.

Borders President Mike Edward said his chain "does not have the capital resources it needs to be a viable competitor." He said the bankruptcy was essential for Borders to restructure its debt and still operate.

Borders, which was founded in 1971 and bought by Kmart in 1992, had liabilities of $1.29 billion and assets of $1.28 billion as of December 25, according to documents filed on Wednesday with the U.S. Bankruptcy Court in Manhattan. Borders has had net losses totaling $680.6 million since the beginning of its 2007 fiscal year.

The pioneer of book superstores plans to abandon some of its highest profile locations, closing a store in its hometown of Ann Arbor, Michigan, as well as one on Manhattan's Park Avenue.

All 200 closings will be superstores, and about 6,000 jobs will be affected, the company said. It has the option of closing up to 275 in all, according to court documents. It said the stores it wants to close lose a combined $2 million a week. The closings will start by Saturday. The company said it will honor gift cards.

Borders operates 642 stores, including about 500 superstores as well as more than 100 smaller Waldenbooks locations. Almost all of the stores closed by the company in recent years were Waldenbooks locations.

"Waldenbooks really is a specialty retailer," said Mark Freiman, a retail consultant with Focus Management Group. "Borders is category killer and essentially a category killer in book is going to go away. There is no question about it."

The largest U.S. bookstore chain, Barnes & Noble, has had success with its Nook e-reader and online store, allowing it to stay in contention with online book pioneer Amazon.com. Borders has lagged well behind.

Borders made a major strategic error in 2001 when it handed off its online business to Amazon. It relaunched borders.com in 2008, but in the first three quarters of 2010, online sales made up only 2.3 percent of revenues.

The chain's difficulties have been worsened by the revolving door in its executive suite in recent years. The company has had four chief executive officers in the past three years and two chief financial officers in 2010.

Sales declined by double-digit percentage rates in 2008, 2009 and in the first three fiscal quarters of 2010. During those nine months, sales came to $1.54 billion.

SMALL BOOST FOR B&N?

The bankruptcy could help sales of traditional books at Barnes & Noble, at least temporarily, analysts said. Credit Suisse estimates that 70 percent of Borders stores are near a Barnes & Noble store. Barnes & Noble operates 717 superstores.

But analysts say Barnes & Noble needs to focus on its e-book strategy, through its Nook e-reader.

"Barnes & Noble shouldn't be distracted by Borders' bankruptcy," said Morningstar analyst Pete Wahlstrom. "If they let their foot off the gas even for a second, Apple and Amazon will be ready to take the spoils."

In bankruptcy, stockholders are typically wiped out. Borders' top shareholder is CEO Bennett Lebow, who injected $25 million of his own money last May to try to shore up the bookseller.

Its second-largest shareholder is hedge fund Pershing Square, whose manager, William Ackman, has said Borders was his worst investment ever.

General Electric Co's GE Capital will provide Borders with $505 million in debtor-in-possession financing to allow it to continue operating, contingent on court approval.

The company's largest unsecured creditors include major publishers that provide the books it sells. Borders owes Pearson Plc's Penguin $41.2 million, Hachette Book Group USA $36.9 million, and CBS Inc's Simon & Schuster $33.8 million, according to court documents.

Borders shares were trading over-the-counter on Wednesday afternoon at around 21 cents, down 7.8 percent from their close; the stock had traded on the New York Stock Exchange before the bankruptcy. Barnes & Noble shares rose 1.7 percent.

The case is In re: Borders Group Inc, U.S. Bankruptcy Court, Southern District of New York, No: 11-10614.

(Reporting by Phil Wahba and Tom Hals; additional reporting by Santosh Nadgir; Editing by Derek Caney and Gerald E. McCormick)

NEW YORK (Reuters) – In New York state's debate over public pension reform, the only retirees more unpopular than the double-dippers are the convicted criminals.

As state and local governments consider how to reduce the billions of dollars they will owe to retirees in future, New York is scrutinizing those who "double-dip" -- retiring early from one job in the public sector and hopping to another. Such workers collect a pension and a salary, and may even eventually be eligible for a second separate pension.

There are at least 2,129 New York state public employees, ranging from nurse to investigator, who are double-dippers.

Then there are the crooks.

In the past six years, criminal or ethical violations have driven 13 legislators out of office, up from four in the previous six-year period, according to Citizens Union, a nonpartisan civic group.

"We believe that those who are convicted of a serious crime maybe should not be receiving their full taxpayer-paid pension," said Citizens Union executive director Dick Dadey.

Those who left office under a cloud include the former Democratic comptroller of New York City and New York state, Alan Hevesi, who resigned in 2006 and pleaded guilty to defrauding the government. A wider corruption probe led to another felony guilty plea from Hevesi last year.

Despite the convictions, Hevesi is paid $8,786 a month, or $105,432 a year, according to the state comptroller.

Then there is former Republican Senate Majority Leader Joseph Bruno, who is waiting to see if his corruption sentence will be overturned. Bruno, a millionaire horse-breeder, retired in 2008 and collects a gross monthly pension of $8,007, the state comptroller's figures show.

Another pensioner is former New York City police commissioner, Bernard Kerik, now serving a prison sentence for failing to disclose loans from a developer. Kerik collects $4,441 a month before taxes, a city official said.

Double-dipping invites criticism from fiscal monitors who note that collecting both a salary and a pension is rare in the private sector and argue that public employees should have to work until age 65 before they can retire, instead of 55.

"Many New Yorkers would like the opportunity to retire, collect a state pension, and then also earn state income but they don't have that opportunity," Dadey said. "That raises the question about a different class of citizenship where elected officials feel a certain entitlement that taxpayers don't feel they deserve."

(Reporting by Joan Gralla; Editing by Daniel Trotta and Eric Walsh)

SAN FRANCISCO (Reuters) – California Governor Jerry Brown ordered a hiring freeze on Tuesday across the state's government to help cut costs in the face of a budget gap of at least $25 billion.

The budget deficit of the nation's most populous state is closely tracked in financial markets. California is the biggest issuer of U.S. municipal debt, and is of concern in Washington as some in Congress have discussed crafting legislation to allow states to declare bankruptcy to ease their fiscal woes.

The U.S. economy may be recovering but state and local governments still face weak revenue due to the recession, housing and financial market slumps, hesitant consumer spending and high unemployment.

Brown's order applies to vacant, seasonal, full-time and part-time positions and will save $363 million in operational costs in the next fiscal year beginning in July, Brown's office said.

"The hiring freeze will be in effect until agencies and departments prove that they can achieve these savings," Brown, sworn in last month, said in the statement.

It was the latest move by the 72-year-old Democrat to trim state spending on his own as he seeks approval from lawmakers for his budget plan.

It includes proposals for $12.5 billion in spending cuts and calls on the legislature to put a ballot measure to voters in June to extend tax increases scheduled to expire this year.

Democrats, who control the legislature, are expected to support Brown's cuts to help win Republican votes needed to advance a measure to the ballot.

The tax extensions, spending cuts and other moves would close a budget gap Brown estimated last month in his budget plan at $25.4 billion through mid-2012.

That deficit may swell to more than $27 billion after Brown canceled a plan to sell state buildings and if his proposal for creating a nearly $1 billion reserve survives budget talks with lawmakers.

In addition to the hiring freeze, Brown has ordered sharp reductions in mobile phones for state employees and in the state's vehicle fleet.

To further underscore frugality, Brown recently took a commercial passenger flight -- coach and without entourage -- to Southern California to urge business groups to support a referendum on tax extensions.

(Reporting by Jim Christie; Editing by Xavier Briand)

NEW YORK (Reuters) – A frail Bernard Madoff, facing the rest of his life in prison, said a variety of banks and hedge funds were complicit in and "had to know" about his epic Ponzi scheme before it was uncovered, The New York Times reported.

In his first interview for publication since his December 2008 arrest, Madoff said banks and hedge funds who dealt with his investment advisory firm demonstrated a "willful blindness" toward his activities, and failed to examine discrepancies between his regulatory filings and other information.

"They had to know," Madoff, described as noticeably thinner and dressed in khaki prison clothing, said in a visiting room in the federal prison in Butner, North Carolina. "But the attitude was sort of, 'If you're doing something wrong, we don't want to know.'"

Madoff, 72, is serving a 150-year prison sentence for what prosecutors called his $65 billion Ponzi scheme, which was uncovered in December 2008.

Irving Picard, a court-appointed trustee seeking money for Madoff victims, has filed lawsuits seeking tens of billions of dollars from companies and individuals he believes benefited from or aided in Madoff's Ponzi scheme.

NO EXCUSES

Among the defendants in these cases is JPMorgan Chase & Co, long Madoff's principal banker and described by Picard as "thoroughly complicit" in the Ponzi scheme.

Other defendants include HSBC Holdings Plc, UBS AG, various "feeder funds" that steered money to Madoff, and the owners of the New York Mets baseball team.

A spokesman for Picard did not immediately return a request for comment. Picard declined to comment to the newspaper. He has recovered about $10 billion for victims so far.

Stephen Cutler, JPMorgan's general counsel, at a presentation on Tuesday said Picard "overreached" in his $6.4 billion lawsuit against the bank, and that JPMorgan "did not know about or in any way participate in the fraud."

In the Times interview, conducted in conjunction with a forthcoming book, Madoff acknowledged his guilt and said nothing could excuse his crimes.

He did not assert that any specific bank or hedge fund knew about or was an accomplice in his Ponzi scheme, which Picard said cost investors more than $20 billion.

METS EXECUTIVES DIDN'T KNOW, MADOFF SAYS

But in a December 19 email cited in the Times article, Madoff said he had been providing Picard with "information I knew would be instrumental in recovering assets from those people complicit in the mess I put myself into."

Then, 10 days later, he said "the banks and funds were complicit in one form or another and my information to Picard when he was here established this."

As to Mets principals Fred Wilpon and his brother-in-law Saul Katz, Madoff said: "They knew nothing. They knew nothing."

In the December 19 email, Madoff also said he had not shared his information with federal prosecutors working on criminal cases related to the fraud.

Eight people have been criminally charged. Madoff, his right hand man Frank DiPascali, and an outside accountant have pleaded guilty. Five, all of whom used to work for Madoff, have pleaded not guilty.

Madoff also told the Times he never thought the collapse of his Ponzi scheme would cause the kind of fallout that has befallen his family.

Picard has filed lawsuits against Madoff's wife, Ruth, that could bankrupt her, while Madoff's son Mark committed suicide on December 11, 2010, two years after the Ponzi scheme was revealed.

Madoff said prison officials would not let him attend his son's funeral, saying it could pose a "public safety issue." He later said it would be "cruel" to put his family through what could be a "media circus" were he to attend.

(Reporting by Jonathan Stempel in New York; Additional reporting by Clare Baldwin; Editing by Gary Hill)

MEXICO CITY (Reuters) – Gunmen shot dead a U.S. customs and immigration agent and wounded another on Tuesday in Mexico, where violence between powerful drug cartels and security forces has surged.

The two Immigration and Customs Enforcement (ICE) agents were driving north on Mexico's main highway on official business when they were attacked in broad daylight.

It was not immediately clear why they were targeted.

The U.S. government condemned the attack, which came just over two weeks after Homeland Security Secretary Janet Napolitano warned Mexico's drug cartels not to take their violent tactics across the border.

"Any act of violence against our ICE personnel ... is an attack against all those who serve our nation and put their lives at risk for our safety," Napolitano said in a statement after the agents were shot.

They were shot in the mid-afternoon south of the city of San Luis Potosi, which is roughly half way between Mexico City and Monterrey, the country's business capital where drug-related violence has soared over the past year.

The two agents may have been ambushed after stopping at what appeared to be a military checkpoint, said a Mexican official who declined to be named because he was not authorized to speak about the case.

Mexican drug cartels have been known to set up official-looking checkpoints, and the official said security forces had no checkpoints in the area.

Television footage showed a blue sports utility vehicle with several large bullet holes lying in the median of the highway, which was guarded by heavily armed Mexican federal police.

The U.S. agents were rushed to a hospital where one died of his injuries. The second agent, who was shot in the arm and the leg, remains hospitalized, ICE said.

More than 15,000 people were killed in drug violence in Mexico last year but, despite growing domestic criticism of President Felipe Calderon's army-led strategy, the government has vowed to press on with its campaign to crush the cartels.

The violence has alarmed Washington, which worries that the fighting could spill over the border. It has also prompted some companies to reconsider plans to invest in Mexico.

The United States has provided funds and training to help Mexico in its fight against the cartels and intelligence from U.S. law enforcement sources is credited with helping Mexico kill and capture several cartel leaders in recent years.

FIRST ICE DEATHS

Attacks on Mexican police by drug gangs are common but U.S. government employees are rarely targeted despite Washington's strong support of Calderon.

San Luis Potosi is home to a federal police academy and has not experienced many drug war killings, but gangs have been moving in to use it as a base for trafficking operations to the north.

Monterrey, Guadalajara and other Mexican cities once far from the front lines of the drug war have seen a recent spike in killings.

ICE said the two men were the first of its agents shot in the line of duty in Mexico.

If there is any evidence that drug gangs targeted the two agents, it would mark an escalation in the conflict.

"What we would hope is that there would be an incredibly strong response from the U.S. government ... Otherwise we could have a situation where it's open season on U.S. federal agents at the border," said Steven Camarota of the Center for Immigration Studies in Washington.

Enrique Camarena, an undercover U.S. Drug Enforcement Administration agent, was kidnapped, tortured and murdered while on assignment in Mexico in 1985.

More recently, two U.S. citizens and a Mexican linked to staff at the U.S. consulate in Ciudad Juarez were killed in March last year, prompting the State Department to tighten security at its diplomatic missions in northern Mexico.

(Additional reporting by Krista Hughes, Adriana Barrera and Armando Tovar in Mexico City; Robin Emmott in Monterrey; Tim Gaynor in Phoenix and Jeremy Pelofsky in Washington; Editing by Kieran Murray and Christopher Wilson)

MIAMI (Reuters) – Many newly elected Republican governors have pledged to run their states like a business as they grapple with low revenues and multibillion-dollar budget gaps with little relief from a fragile U.S. economic recovery.

But since they took office last month, few have gone as far in advancing campaign promises for less government and lower taxes than Florida's Tea Party-backed Governor Rick Scott.

A political newcomer, with a controversial past as chief executive of a healthcare corporation that paid a record $1.7 billion in fines for defrauding Medicare and other federal programs, Scott has taken to the job of running the fourth-largest U.S. state like a hostile takeover.

An uncompromising conservative, Scott unveiled his first budget last week at a rally attended by about 1,000 Tea Party activists in a Baptist church hall in Eustis, a town some 200 miles outside the state capital Tallahassee, where the state legislature will have to approve his proposed budget.

"Governor Scott said he wanted to present the most conservative budget in the nation," said Alan Stonecipher of the nonprofit Florida Center for Fiscal and Economic Policy.

"It certainly appears to be hugely pro-business which was his stated intention," Stonecipher added. "I would say Florida is right in the mix, or maybe leading the nation, in a movement to, in effect, eviscerate government."

Even by the standards of a state renowned for political scandals and shenanigans, 58-year-old Scott, who has emphasized that he was never charged with any crimes as CEO of the giant Columbia/HCA hospital chain, has raised eyebrows.

His declared intention to cut regulations and taxes, and a 'slash-and-burn' approach to putting Florida's financial house in order with little apparent regard for real-world implications, have prompted warnings of dire consequences.

There may be backlash against Republicans in a presidential battleground state as the new governor, who has never served in elected office before, takes budget-slashing to new heights.

"VOODOO ECONOMICS"

The carefully orchestrated budget presentation cast Scott, who beat his Democratic rival by a single percentage point after spending $73 million of his personal fortune on his own campaign, in the role of a Tea Party man of the people.

But he also ranks among the most unpopular newly elected governors in U.S. history, with a favorability rating of just 28 percent, according to a recent Quinnipiac University poll.

Critics cited his budget proposals -- deep cuts in state spending on education and healthcare to close a deficit of nearly $4 billion, while slashing corporate income and property taxes -- as signaling a disconnect between fiscal conservatives and ordinary Americans reeling from unemployment and the loss of homes and benefits in the recent recession.

"Retreaded voodoo economics," Florida Senate Democratic leader Nan Rich said of Scott's budget plan, referring to the trickle-down economic theory popularized under President Ronald Reagan. "The tentacles of this budget will reach the most vulnerable people in our state," Rich told Reuters.

She said the real trickle-down effect would add to the pain of most Floridians while leaving open many tax loopholes in a state that is home to some of the Republican's richest patrons.

Florida is not alone in contemplating large spending cuts to offset revenues only slowly recovering from recession and the winding down of $150 billion of federal assistance to states from the economic stimulus program of 2009.

According to the Center on Budget and Policy Priorities, nearly all states are considering spending less in fiscal 2012 than in 2008. That was the last year before recession devastated revenues.

The nonpartisan center has warned that reduced spending on education, healthcare and other important services will delay the U.S. recovery and undermine efforts to create jobs, especially in states where new Republican governors like Scott are pushing for corporate tax cuts.

Illinois, where Democratic Governor Pat Quinn successfully pushed a hefty income tax increase to ease a $15 billion budget deficit through the legislature last month, is a rare exception to a national trend toward flat or lower taxes as the best tool to lure investment to recession-hit states.

"IN THE PEOPLE'S HANDS"

Florida is less distressed than Illinois and some other states, where the fiscal crisis has roiled the traditionally stable $2.8 trillion municipal bond market and spurred proposals by some U.S. lawmakers to consider allowing states to declare bankruptcy.

But the Sunshine State is an epicenter for the collapse of the U.S. housing market and the mortgage crisis. It is also has a record 12 percent unemployment rate, the third highest in the country after Nevada and California.

Scott's budget includes a call to cut the state work force by nearly 9,000 jobs and it would require state workers, who have not had a general pay raise in five years, to contribute 5 percent of their salaries to their pensions.

His budget, apart from a vague promise of attracting business investment, appears to hold out little immediate hope for job creation. And he has proposed shifting more of the cost businesses pay for jobless benefits onto Florida taxpayers.

Such controversial proposals have been welcomed by business groups and by his Tea Party supporters.

Tom Gaitens, Florida state director of FreedomWorks, a libertarian group, which works closely with Tea Party activists and is headed by ex- U.S. House of Representatives Republican leader Dick Armey, said he was "very proud" of Scott.

"Even if you don't agree with him, you have to give the guy credit for making hard decisions," Gaitens said. "As a businessman, not as a politician, he understands that the capital that fuels the economy has to be left in the people's hands, not in the government's," he said.

But Scott's initiatives drew sharp criticism elsewhere.

"I'm very disappointed to have these tax cuts put money into well-to-do corporate pockets and abandon the needs of our most fragile and dependent citizens," said Pouria "Paul" Bidhendi, 37, the owner of two businesses, including a job recruiting and staffing company, in Orlando.

"He comes across as this super rich guy talking down to poor people," said John Faherty, 49, an event management consultant. "He's like an alien trying to talk to us."

Gaitens said the Tea Party probably has less than 200,000 active members across the state, but has punched well above its weight. This was reflected in media coverage of personalities like Florida's new U.S. Senator Marco Rubio, a Tea Party-affiliated Cuban-American who is considered a rising star of the Republican Party.

The rank-and-file Tea Partiers' obsession with government spending and deficits also runs counter to recent polls such as a Gallup survey showing that most Americans see joblessness as the country's leading cause of concern by far.

But the Tea Party and its rich supporters are in lockstep with big business in using the fiscal crisis to try to weaken organized labor, analysts say.

"That's the great hope of the far right conservatives. They're seizing the moment of fiscal crisis to either destroy or cripple the labor movement," said Harley Shaiken, a labor expert at the University of California at Berkeley.

(Additional reporting by Barbara Liston in Orlando, Michael Peltier in Eustis, Jeff Mayers in Madison, Wisconsin, and Lisa Lambert in Washington; Editing by Pascal Fletcher and Christopher Wilson)

WASHINGTON (Reuters) – One day after President Barack Obama presented Congress with his $3.7 trillion budget, the focus shifts on Tuesday to Washington's more immediate spending needs and a controversial spending-cut bill that Republicans hope to pass in the House of Representatives.

The House legislation, cobbled together by Republicans after weeks of intraparty fighting, would cut about $61 billion from current spending in a bill to fund government activities through the rest of this fiscal year that ends on September 30.

The spending being proposed would be equal to a 14 percent cut from last year.

The House is expected to hold a freewheeling debate that will see conservatives pushing for even deeper spending cuts -- reflecting the Tea Party presence in the new, Republican-controlled chamber -- while moderates and liberals from both parties worry about the impact of the cuts.

Responding to those concerns, House Majority Whip Eric Cantor on Monday told reporters that the bill would simply pare back spending to 2008 levels.

"I think everybody remembers 2008," Cantor said. "The sun rose and set in 2008... I think right now people understand we don't have the money. You can't keep spending money you don't have."

But Secretary of State Hillary Clinton was concerned enough about the Republican spending plan to travel to Capitol Hill, where she lunched with House Speaker John Boehner.

Following their meeting, Clinton told reporters that while the United States has tough fiscal problems, "The scope of the proposed House cuts is massive. The truth is that cuts of that level will be detrimental to America's national security."

The House Republicans' bill would cut State Department and USAID budgets by some 16 percent this year compared to 2010 at a time when political uncertainty reins in the Mideast following Egyptian President Hosni Mubarak's ouster.

Other government accounts that would face significant reductions under the House bill include popular education programs, USDA meat inspections, NASA space exploration and agriculture research.

Stop-gap funding for this year expires on March 4, giving Congress little time to work out a deal on spending for the rest of the year. As a result, another short stop-gap funding bill is likely while the House, Senate and Obama work out their differences on spending this year.

But with such a deep gap between Democrats and Republicans, there is a chance of failure, which could bring government shutdowns like ones last seen in 1995-96. Those brought immediate halts to many essential government operations and another round could throw financial markets into turmoil.

As the House debates the spending bill for the current fiscal year -- with tough votes on passage anticipated by Thursday or Friday -- the administration will begin defending Obama's budget proposal for fiscal 2012 to skeptical congressional committees.

White House Budget Director Jack Lew and Treasury Secretary Timothy Geithner will be grilled by budget and tax-writing committees on Tuesday and continue their appearances through Thursday, along with other Obama Cabinet secretaries.

By April, the Republican-led House Budget Committee is expected to offer its budget blueprint that likely will be vastly different from the one Obama unveiled on Monday.

Still unclear is whether Obama and congressional Republicans will make a serious effort at a long-term fix to the U.S. deficit problem, which is forecast to be in the range of $1.48 trillion to $1.65 trillion just this year, or 9.8 percent to 10.9 percent of U.S. GDP.

Also thrown into the mix in coming weeks will be an attempt to raise U.S. borrowing authority before it is exhausted in April or May. Tea Party activists in the House and Senate are threatening to block that bill.

(Editing by Eric Walsh)

WASHINGTON (Reuters) – President Barack Obama on Monday proposed an ambitious long-term transport spending plan in his 2012 budget as a way to boost U.S. economic competitiveness and spur job growth.

While cutting other spending, Obama aggressively accelerated efforts to upgrade aging roads, bridges and introduce high-speed rail with a six-year, $556 billion package.

"It's really about a big vision, a bold vision, an innovative vision," Transportation Secretary Ray LaHood told reporters.

The total is 60 percent richer than the last transportation blueprint enacted by Congress, which expired in 2009.

Congress is working on its own transportation spending priorities with proposals expected soon. LaHood expressed optimism recently legislation could be approved this year.

In a sign of the intense opposition to Obama's transportation policies, House of Representatives Republicans on Friday proposed eliminating Obama's high-speed passenger rail effort.

Republicans hold the majority in the House and are seeking deep cuts across the board to narrow the budget deficit, which is forecast to reach $1.48 trillion this fiscal year.

The Obama proposal relies heavily on competitive grants and sidesteps earmarks in order to depoliticize how projects are financed. According to LaHood, the plan will consolidate 55 smaller highway programs into five different areas.

"This budget does all that I've talked about in bold terms ... without passing any debt on to future generations," LaHood said, adding the federal government will ensure "the dollars we give out do not exceed dollars coming in."

According to department documents, the proposal's high price would be paid by a "Transportation Trust Fund." Essentially, the administration would expand the current Highway Trust Fund to also back transit, high-speed rail, and a national infrastructure bank. But LaHood said Obama has not suggested where to find revenues for the bigger account.

Obama is not seeking to raise gasoline taxes nor does he embrace calls by some experts to charge motorists a fee for each mile they drive.

INFRASTRUCTURE BANK

Obama's plan includes a $53-billion proposal to advance high-speed rail over six years and a proposal to spend nearly 17 percent of the overall $556 billion transportation package in the first year.

It would also create an infrastructure bank capitalized at $30 billion over six years to finance the biggest projects with the help of states and private investment.

Obama pushed the infrastructure bank idea last year, but it got a cool reception in Congress and a government poll released this summer showed analysts, transportation agencies and states' leaders were unclear about how it would operate.

Under Obama's plan the bank would reside within the Transportation Department and be run by an executive director and a board of officials from federal agencies. At first, it would only finance transportation projects.

General Electric Chief Executive Jeff Immelt said last month that prospects are slim for an infrastructure bank, because of deficit concerns.

Proponents of an infrastructure bank have said investments from private equity and pension funds and other sources would complement federal capital. Projects could generate revenue through tolls or other fees that would provide long-term, low-yield returns for investors.

Australia's Macquarie Group is the global leader in private infrastructure investment, according to Infrastructure Investor magazine rankings. Others include Goldman Sachs and Alinda Capital Partners, the largest U.S. manager of pension funds for infrastructure investment.

The American Society of Civil Engineers estimates it will cost more than $2 trillion to bring roads, bridges, and other infrastructure to a state of good repair.

Increased spending would potentially benefit companies like heavy equipment makers Caterpillar Inc and Deere & Co, sand and gravel producer Vulcan Materials, industrial conglomerate General Electric, engineering firm Parsons Corp, steelmakers and prefabricated materials manufacturers. LaHood is scheduled to visit Caterpillar on Tuesday.

The previous transport bill, a five-year, $285 billion package, expired in September 2009. Since then, Congress has funded road and transit projects through short-term extensions.

(Editing by Anthony Boadle, Tim Dobbyn and Eric Walsh)

NEW YORK (Reuters Health) – With Americans chugging energy drinks like never before, fears are growing among doctors that the ingredients might be putting some consumers at risk.

The beverages contain a hodgepodge of caffeine, sugar and dietary supplements such as vitamins and herbal extracts, whose effects aren't well understood.

In a new report out Monday, Florida pediatricians describe cases of seizures, delusions, heart problems and kidney or liver damage in people who had downed one or more non-alcoholic energy drinks -- including brands like Red Bull, Spike Shooter and Redline.

"Across the world there are signs that for some people who consume these drinks, there are side effects," said Dr. Steven E. Lipshultz, who heads the department of pediatrics at the University of Miami Leonard M. Miller School of Medicine.

"The incidence is low, but in certain groups that pediatricians care for there may be higher risks," he added.

The report, which calls for regulatory action and more research, comes only months after a U.S. crackdown on alcoholic caffeinated beverages such as Phusion Projects' Four Loko.

U.S. sales of non-alcoholic energy drinks are expected to hit $9 billion this year, with children and young adults accounting for half the market,

Because the beverages are classified as nutritional supplements, they have received much less scrutiny and are under fewer restrictions than both foods and drugs.

Manufacturers claim their products will enhance both mental and physical performance. Red Bull's website, for instance, says energy drink will increase concentration and reaction speed, and improve vigilance and emotional status.

"Red Bull's effects are appreciated throughout the world by top athletes, busy professionals, active students and drivers on long journeys," the website claims.

In 2010 alone, the company told Reuters Health, it sold in excess of 4 billion cans and bottles of the drink, which is now available in more than160 countries.

But according to the Florida researchers, who reviewed the medical literature on the topic, the industry's claims of benefit are questionable.

"We couldn't find any evidence at all of any therapeutic effects," Lipshultz said.

He began to take an interest in energy drinks a few years ago, when four kids from South Florida were brought to the hospital after swallowing a vitamin concoction their teacher had bottled.

"They all came in feeling tingling all over," Lipshultz said. "This prompted me to say, we've got to really learn about this."

What he and his colleagues found was a pile of anecdotes, but little hard evidence. In Ireland, for example, the country's poison center reported 17 cases of possible side effects between 1999 and 2005, including seizures, heart rhythm disturbances and two deaths.

And in New Zealand, 20 similar cases were reported between 2005 and 2009.

"It's the tip of the iceberg," Lipshultz ventured. "How many people take the time to call a poison control center when they don't feel well?"

While the U.S. poison control centers haven't been able to track potential side effects from energy drinks in the past, they have told Lipshultz they will start doing so from this year on.

Of course, isolated anecdotes don't prove the drinks are to blame. But they do have doctors wondering whether some people, kids in particular, might be at risk.

For example, caffeine is known to cause fast heart rate, insomnia, and anxiety, especially in sensitive individuals.

According to one study from New Zealand, just one energy drink is enough to make most kids experience some side effect, including mild ones like irritability or upset stomach.

And there are other ingredients with effects of their own, such as the amino acid taurine, the herbal extracts yohimbine, guarana and ginseng, and often loads of sugar.

High doses of yohimbine have been linked to increased blood pressure and heart rate. And like ginseng, yohimbine may interact with other drugs.

"If it were as simple as energy drinks just containing caffeine, that would be one thing," Lipshultz told Reuters Health. "The problem is they contain a lot of other substances."

What this all adds up to is still unclear. It's obvious that few people suffer serious side effects, but nobody knows just how common they are and who is likely to experience them.

"Many ingredients are understudied and not regulated," the Florida researchers write in the journal Pediatrics.

Lipshultz, for one, says people with heart disease, seizures, diabetes, high blood pressure, or attention-deficit hyperactivity disorder (ADHD) should think twice before downing an energy drink.

"Up until I did this review, I wasn't routinely asking my patients if they were drinking energy drinks," he told Reuters Health. "Now I am, and it is the basis for a discussion."

But manufacturers downplay the new report.

According to an e-mail from Red Bull, "This article just draws together material from the Internet and largely ignores in its conclusions the genuine, scientifically rigorous examination of energy drinks by reputable national authorities."

"The effects of caffeine are well-known and as an 8.4 oz can of Red Bull contains about the same amount of caffeine as a cup of coffee (80 mg), it should be treated accordingly."

The American Beverage Association, which represents several manufacturers, seconded Red Bull's criticism.

"Most mainstream energy drinks actually contain about half the caffeine of a similar size cup of coffeehouse coffee," it said in a statement. "In fact, young adults getting coffee from popular coffeehouses are getting about twice as much caffeine as they would from a similar size energy drink."

Lipshultz countered that he'd found caffeine contents ranging anywhere from 75 to 400 milligrams (mg) per container, including the small "energy shots."

Mild side effects begin to appear when people drink around 3 mg of caffeine per kilo body weight (1.4 mg per pound) in addition to normal dietary intake. That means an energy shot would push a typical 12-year-old three times over the limit.

And there is another difference between coffee and energy drinks, which are often marketed toward athletes.

"If you're a 16-year-old who just came out of football practice, you're not going to have three cups of hot coffee. But you might have three energy drinks," Lipshultz said.

In fact, high amounts of caffeine increase urine production, making our bodies lose water.

"If you are looking to prevent dehydration, sports drinks are what you should be drinking," Lipshultz said. Other experts recommend that tried and tested drink, water.

Concluded Lipshultz: "If there is no real upside to taking (energy drinks), and they clearly put some people at risk, my personal feeling is we should protect kids."

SOURCE: http://bit.ly/cxXOG Pediatrics, online February 14, 2011.

SEATTLE (Reuters) – Firefighters on Sunday were putting out hot spots from a fierce, wind-whipped blaze that gutted 20 homes and forced 300 residents from their dwellings on the Yakama Indian Reservation southeast of Seattle.

Two firefighters sustained minor eye injuries from flying debris while battling the blaze, which began Saturday afternoon when embers from a chimney fire ignited a rooftop and spread to an adjacent lumber yard and surrounding brush, fire officials said.

The flames grew quickly, eventually engulfing 20 homes and four other private structures in White Swan, a village of some 3,200 residents within the 1.3 million-acre reservation. A post office also was damaged.

The blaze was contained by late Sunday morning, and fire crews were starting "mop-up" operations in "what's left of the burning structures," Yakima County Fire Department Captain Dave Martin told Reuters by telephone.

Deputy Fire Chief Allen Walker said he expected it would take several days to completely extinguish the remaining hot spots, especially at a saw mill where stacks of smoldering logs were piled 25 feet high.

Gale-force winds and gusts of up to 80 miles per hour hampered firefighting efforts on Saturday by propelling the spread of the flames while uprooting trees and downing power lines, blocking access to some areas, Martin said.

White Swan, one of the main communities on the Yakama reservation, was placed under a voluntary evacuation at the height of the blaze, and some 300 residents fled their homes. About 50 of them spent the night in emergency shelters.

The Yakama reservation, located in south-central Washington state about 110 miles from Seattle along the eastern slopes of the Cascades, is home to about 10,000 registered tribal members.

At Toppenish Creek Longhouse, where some residents sought shelter overnight, a woman answering the phone on Sunday said she could not talk because a church service was under way there. Loud drums and chanting were audible in the background.

About 90 firefighters were on the scene at the height of the fire, Martin said. On Sunday, fresh crews were brought in to relieve those who answered the initial calls on Saturday.

(Additional reporting by David Bailey; Editing by Steve Gorman)