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Thursday, June 29

Editor's Note: The CNN Wire is a running log of the latest news from CNN World Headquarters, reported by CNN's correspondents and producers, and The CNN Wire editors. "Posted" times are Eastern Daylight.

8 Islamic militants die in firefight with Indian security forces

SRINAGAR, Indian-controlled Kashmir (CNN) -- A fierce gun battle between Islamic militants and Indian security forces along the Line of Control in Kashmir late Thursday left eight of the militants dead, police said.

According to police senior superintendent Vijay Kumar, a group of heavily armed intruders was caught trying to sneak into Indian-controlled Kashmir from the side administered by Pakistan when the firefight broke out.

"When they were challenged to surrender they opened fire on the troops," Kumar said. "A fierce encounter followed which ended early this morning. Bodies of eight intruders have been recovered from the encounter site besides a large cache of arms and ammunition."

The confrontation took place in the Keran sector, about 87 miles (140 km) from Srinagar.

The gun battle was the first along the Line of Control since a bilateral ceasefire was implemented in December 2004 between Indian and Pakistan. -- From Journalist Mukhtar Ahmad (Posted, 2:40 a.m.)

2 dead in latest Sri Lanka fighting

COLOMBO (CNN) -- A firefight erupted Friday between Sri Lanka's navy and Tamil Tiger rebels in northwestern Sri Lanka, leaving one sailor and one rebel dead, according to a military spokesman.

The confrontation near the western seaboard town of Mannar began after a Navy team went to check on reports that armed rebels were planning attacks, spokesman Prasad Samarasinghe said.

The violence comes two days after the rebel group's "Sea Tigers" wing surrounded a Navy boat on routine patrol offshore of Mannar. At least three sailors were killed in the ensuring gun battle.

Rebel attacks and government reprisals against Tamil strongholds have been frequent over the past few months, in violation of a cease-fire brokered by Norway in 2002.

The Liberation Tigers of Tamil Eelam (LTTE), known as the Tamil Tigers, have been seeking their own Tamil homeland in the north and east of the island nation, which lies to the south of India. -- From Journalist Iqbal Athas (Posted, 2:24 a.m.)

Islamic Web site posts purported bin Laden message

(CNN) -- An audiotape posted Friday on an Islamic Web site purports to be the voice of al Qaeda leader Osama bin Laden, grieving over the death of Abu Musab al-Zarqawi earlier this month.

Al-Zarqawi, who masterminded hundreds of bombings, kidnappings and beheadings in Iraq, was killed June 7 by an U.S. airstrike north of Baghdad. He was al Qaeda's leader in Iraq. The audiotape, which last 19 minutes, 32 seconds, is imposed over a split screen, with a still image of bin Laden on one side and a video of al-Zarqawi on the other.

On Wednesday, the Web site posted a note saying it was expecting a message "soon" from bin Laden, and that he would react to al-Zarqawi's death. (Posted 9:55 p.m.)

Rice, Lavrov spar during closed-door exchange caught on audio feed

MOSCOW (CNN) -- Reporters covering a meeting of Group of Eight foreign ministers Thursday accidentally got a rare, behind-the-scenes peek at the world of high-level diplomacy, when an errant audio feed captured some less-than-diplomatic verbal volleying between Secretary of State Condoleezza Rice and Russian Foreign Minister Sergey Lavrov.

As the diplomats lunched behind closed doors, trying to hammer out language in a communique over Iraq, Rice and Lavrov sparred in English over several details. The audio feed continued for 24 minutes.

When Lavrov suggested including language pressing the Iraqis to make more progress on reaching national reconciliation accords, Rice argued that the Iraqis "are making efforts, very often at the cost of their own personal lives."

After a week in which four Russian diplomats were abducted and killed in Baghdad, Lavrov also wanted to add language calling on the Iraqis to improve security at diplomatic missions.

Rice objected, saying, "Sergey, there is a need for improvement of security in Iraq, period." (Posted 8:23 p.m.)

U.S. concerned about flow of money, weapons into Somalia

WASHINGTON (CNN) -- Money and weapons are flowing into Somalia from Saudi Arabia, Yemen and other Arab nations to support the Islamic militia that seized the capital Mogadishu earlier this month, a senior U.S. state official said Thursday.

Jendayi Frazer, the assistant U.S. secretary of state for African affairs, told a House committee that the Somali situation is "the most serious threat in many decades" to the Horn of Africa. Though Frazer shied away from outright accusing Saudi Arabia of supporting any particular faction within the Supreme Islamic Courts Council, she said the United States wants to convince the Saudis, Yemenis and others to clamp down on that support.

On Thursday, the group changed its name to the Supreme Islamic Courts Council and added new members in a bid to expand its aim of imposing Islamic law throughout the country. Frazer said "mixed messages" were coming from the group, which the United States suspects is harboring al Qaeda operatives. (Posted 8:10 p.m.)

House votes to condemn disclosure of bank record collection

WASHINGTON (CNN) -- On a mostly party-line vote, the House Thursday approved a resolution condemning last week's disclosure of a Treasury Department program to collect international banking records to try to track the flow of money to terrorists.

The 227-183 vote came after a debate in which Republican supporters of the resolution complained about what they termed the media's irresponsibility and arrogance in revealing the program's existence, despite requests from the Bush administration not to do so.

The chairman of the House Homeland Security Committee, Rep. Peter King, R-N.Y., said the media outlets involved were "not just the facilitators of the leakers. They are co-conspirators." But Rep. John Dingell, D-Mich., called the measure "a bald-faced attempt to strangle criticism of this administration." (Posted 7:45 p.m.)

Israel rounds up Palestinian leaders, stays new Gaza push

JERUSALEM (CNN) -- Israeli artillery and airstrikes pounded Gaza early Friday but held off further incursions into the territory in search of an Israeli soldier kidnapped by Palestinian militants.

Israeli warplanes hitting the Palestinian Authority's Interior Ministry building in Gaza City, which the Israeli military said was being used "for directing and planning terror actitvities." Israeli guns fired more than 400 shells into the territory on Thursday, and Palestinians fired four rockets into Israeli territory, none of which caused damage or injuries, the Israel Defense Forces reported.

Israel launched a major push into southern Gaza early Wednesday in search of kidnapped army Cpl. Gilad Shalit. Airstrikes and shelling have targeted the northern half of the territory as well, but an expanded push had been put on hold to allow more time for diplomatic efforts to work.

"We're willing to wait. There is some respite, and we will give diplomacy a chance as we have already been," Daniel Ayalon, Israel's ambassador to the United States, told CNN. "But time is of essence, and of course we cannot wait indefinitely." (Posted 7:25 p.m.)

Frist: Senate to consider stem cell bill in July

WASHINGTON (CNN) -- Senate Majority Leader Bill Frist introduced a House-passed stem cell funding bill on the Senate floor Thursday, which he said would be debated and voted on in July.

Two less-controversial stem cell-related bills will also be considered at the same time, Frist said. At least one conservative Republican senator, Tom Coburn of Oklahoma, had threatened to block the bill from floor consideration but relented after extensive negotiations with Frist, R-Tenn.

Democratic Leader Harry Reid said the news of the scheduling of the bill "will bring peace and comfort" to former First Lady Nancy Reagan and other advocates of stem cell research. Reagan has lobbied Frist in recent days to schedule the bill, his office said. Under the agreement, the bill will need 60 votes to be adopted.

President Bush has threatened to veto the measure. (Posted 7:15 p.m.)

Ex-Ala. governor, Scrushy guilty in corruption case

(CNN) -- A federal jury in Montgomery convicted former Alabama Gov. Don Siegelman and ex-HealthSouth CEO Richard Scrushy of bribery charges Thursday in a case stemming from corruption allegations dating back to Siegelman's term in office.

A jury convicted Siegelman of bribery and conspiracy, mail fraud and obstruction of justice, while Scrushy -- who was acquitted in a massive corporate fraud case in 2005 -- was convicted of bribery, the U.S. Attorney's office in Montgomery told CNN. Siegelman served as Alabama's governor from 1999 to 2003 and mounted a failed comeback attempt this year, losing the Democratic gubernatorial nomination to Lt. Gov. Lucy Baxley earlier this month.

Scrushy, then head of Birmingham-based HealthSouth, was accused of making two payments to Siegelman totaling $500,000 in exchange for an appointment to a medical review board. A federal jury in Birmingham surprised courtroom observers -- and shocked prosecutors -- by acquitting him on 36 counts related to a $2.7 billion accounting fraud at HealthSouth last June. (Posted 4:45 p.m.)

Troops kill Iraq insurgents suspected in Monday bombing

BAGHDAD (CNN) -- Three insurgents suspected of involvement in the Monday bombing of a crowded market in Baquba that killed 18 people were themselves killed in a firefight with Iraqi and U.S. troops Thursday afternoon, a U.S. military official said.

An Iraqi police commander was killed and two police officers were wounded in the battle, which began when during the search of a house in Kharnabat, just north of Baquba, the official said.

The official said the U.S. military believes the insurgents were tied to those who carried out Monday's bombing in which a motorcycle packed with explosives detonated in the middle of a crowded Baquba market, killing at least 18 people and wounding 20 others Monday evening. The blast happened in a square surrounded by coffee shops and stores at a time when many Iraqis were gathered there, police said. (Posted 4:40 p.m.)

Israel rounds up Palestinian leaders, stays new Gaza push

JERUSALEM (CNN) -- Israel swept up members of the Hamas-led Palestinian government Thursday, arresting Cabinet ministers and parliament members as the crisis over the kidnapping of an Israeli soldier deepened.

The arrests came amid word that the body of a kidnapped Jewish settler had been found on the West Bank, and a group claiming to have killed him threatened more abductions and killings. Meanwhile, Israeli artillery pounded northern Gaza in an attempt to end the firing of Palestinian rockets into Israel, and Israeli troops moved through southern Gaza in search of kidnapped army Cpl. Gilad Shalit.

However, Palestinian sources told CNN that an expanded Israeli push into northern Gaza had been put on hold to allow more time for diplomatic efforts to work.

The Palestine Liberation Organization said 84 people, including seven members of the Hamas-led Cabinet and 21 members of the Palestinian parliament, had been rounded up in the Israeli sweep.

The Israel Defense Forces put the total number of arrests at 87, including 64 Hamas members -- Cabinet ministers, MPs and senior activists. (Posted 3:27 p.m.)

12-year-old boy dies on Disney-MGM roller coaster

(CNN) -- A 12-year-old boy died while riding a Disney-MGM Studios roller coaster ride in Orlando, Fla., Thursday afternoon, the Orange County Sheriff office told CNN.

The boy was found unresponsive in his seat at the end of the "Rock'n Roller" coaster ride, said Terry McElroy of the Florida Department of Agriculture, which regulates the industry.

Park managers immediately shut down the ride, and the Florida inspector is now on site to observe the Disney investigation. The state Bureau of Fair Rides Inspection has also been notified and will observe the "Rock'n Roller" coaster inspection, a Disney statement said.

A company representative is visiting the boy's family and "providing assistance," the statement said. (Posted 3:25 p.m.)

Former White House aide requests trial delay, prosecutors would not oppose

WASHINGTON (CNN) -- Former White House aide Lewis "Scooter" Libby is asking a federal judge for a month's delay in the start of his trial now scheduled for January, citing a potential scheduling conflict involving one of his defense lawyers.

A document filed Thursday with U.S. District Court said attorney Theodore Wells faces a prolonged, unrelated case in California scheduled for September that could crowd the Libby trial a few months later.

Hoping to avoid asking for a continuance late in the year, the early request explains "by that time the Court, counsel for the government, and other defense counsel will likely have set their calendars" for 2007 as they proceed to a January Libby trial. --From CNN's Paul Courson (Posted 3:21 p.m.)

Pa. residents closely watching rising Delaware River

NEW HOPE, Pa. (CNN) -- As residents of northeast Pennsylvania and New York largely breathed a sigh of relief that flood walls and levees held rising waters back, preventing the worsening of flooding that killed 12 and caused millions of dollars in damage, residents of southeastern Pennsylvania were bracing for the worst, with a cresting Delaware River poised to wreak havoc.

Daryl Jurbala, deputy emergency operations coordinator for New Hope, said water levels remained unchanged over the past hour as of about 2:30 p.m., and officials hope it will begin to gradually recede.

"If it continues to go up, we are past the level of our last flood -- that's about 19 feet over normal levels of water," he said. "We know what's flooded, and we want to minimize damage as much as possible. We can't turn the power on until the water goes down -- we want to get residents back in there as soon as possible ... the faster it goes down, the better off we are."

About 500 residents and at least 250 of the area's 320 businesses have been evacuated, he said. (Posted 3:20 p.m.)

Chertoff calls for Congress to act on immigration

WASHINGTON (CNN) -- Secretary of Homeland Security Michael Chertoff said Thursday that the problem of illegal immigration into the U.S. will worsen and fester if Congress does not pass immigration reform measures before the end of the year.

"Congress has an opportunity and it has a responsibility to act this year to tackle this problem," he said in a speech in Washington. "The President has used the tools of the so-called 'bully pulpit' to speak very aggressively and clearly about the comprehensive solution he thinks is appropriate. That is the way presidents move Congress."

Immigration legislation has stalled in Congress with the House and Senate favoring widely different proposals. Last week House Republicans announced plans to have a series of immigration hearings around the country, a move critics say makes it unlikely any bill will pass this year.

Chertoff predicted that the number of border patrol agents in the U.S. will more than double during President Bush's time in office, reaching 18,000 by the end of 2008. Fences, vehicle barriers, roads, and sophisticated equipment such as sensors, unmanned aircraft and satellites will be added to their artillery, he said. -- From CNN's Justine Redman (Updated 3:28 p.m.)

Flooded basement forces month-long closing of IRS headquarters

WASHINGTON (CNN) -- Flood damage at the Internal Revenue Service headquarters has forced the closing of the building for at least 30 days, although officials said it would not affect IRS service and enforcement operations. (Posted 2:25 p.m.)

Suicide bombing in Kirkuk, 4 dead, 31 wounded

BAGHDAD (CNN) -- A suicide car bomber in Kirkuk drove into a wake for a slain Iraqi soldier on Thursday, killing four and wounding 31, police in the northern Iraqi city told CNN.

The incident took place on Rashid Street in central Kirkuk.

The slain soldier, a Shiite, was gunned down two days ago. The oil-rich city of Kirkuk is a cauldron of ethnic and religious tension. Shiites and Sunnis, and Arabs, Turkmen, and Kurds live there. (Posted 2:24 p.m.)

U.S., Canada announce results of probe into 'brazen' drug smuggling

BELLINGHAM, Wash. (CNN) -- It's payback time.

A year after Playboy magazine profiled dope smugglers who flaunted the ease in which they used helicopters to skirt authorities in the United States and Canada, officials from the two countries announced Thursday the results of an investigation that has led to more than 40 arrests and the seizure of several aircraft and a large amounts of drugs and money.

Dubbed "Operation Frozen Timber," the almost two-year investigation pre-dated the publication of the Playboy article, but was kept quiet to prevent smugglers from knowing that investigators had discovered several landing zones favored by dope runners, officials said. -- From CNN Homeland Security Correspondent Jeanne Meserve and Producer Mike M. Ahlers

Floodwaters in northeast U.S. receding in many areas; cleanup, evaluation begin; 12 dead

WILKES-BARRE, Pa. (CNN) -- A mandatory evacuation affecting up to 200,000 people in Wilkes-Barre and a nearby valley area was to be lifted at noon Thursday, allowing residents to return home as officials breathed a sigh of relief that the city's $175 million levee system held back the rising Susquehanna River despite flooding in some areas.

Mayor Tom Leighton said the decision to lift the evacuation order was based on an Army Corps of Engineers inspection of a local dike, which was ruled safe.

"We want to give the nursing homes and hospitals a chance to come back into town before the traffic gets heavy," Leighton said.

Pennsylvanians weren't the only ones relieved Thursday.

In Binghamton, N.Y., where 15,000 people were evacuated as the river rose Tuesday and Wednesday, Mayor Matthew Ryan credited flood walls with saving the city despite the fact some neighborhoods remained under several feet of water.

Overall, at least 12 people were killed in the Northeast flooding, which caused millions of dollars in damage.

The Susquehanna crested Wednesday at 34.4 feet, and by midmorning Thursday had dropped to about 31 feet, officials said. The city's levees can hold up to 41 feet. While that was cause for relief, many rivers and creeks overflowed after days of rain, and flooding was also evident in areas outside the levees. (Updated 1:48 p.m.)

Terror suspect to remain jailed, will be transferred to Miami

ATLANTA (CNN) -- One of seven would-be terrorists arrested last week was denied bond Thursday and will be transferred to Miami to stand trial with his co-defendants, an Atlanta federal judge ruled.

Lyglenson Lemorin, also known as Brother Levi, admitted being part of a group that swore allegiance to al Qaeda, but also said he did not want to be part of any plot to blow up buildings, according to testimony presented in his bond hearing.

Prosecutors said Lemorin and other members of the group were told by an undercover government informant posing as an al Qaeda member that Osama bin Laden was aware of them and had referenced them in a statement -- a lie aimed at motivating them to continue with their alleged plot. (Posted 1:31 p.m.)

High court upholds tight standards for insanity claims

From CNN Supreme Court Producer Bill Mears

WASHINGTON (CNN) -- Ruling in the case of a convicted teenage cop-killer, the Supreme Court Thursday said Arizona's standard for establishing an insanity defense was not overly severe.

The 6-3 decision allows the guilty verdict against Eric Clark to stand.

The issue went to the heart of the young man's defense: What legal limits states can place on criminal suspects who claim insanity or severe mental illness.

Such limits have been tightened significantly in the past quarter-century, and this ruling is likely to keep in place laws in 46 states that allow an insanity defense. Only Idaho, Montana, Utah and Kansas prohibit it. (Posted 1:28 p.m.)

Bush will fully review Gitmo ruling

WASHINGTON (CNN) -- President Bush said Thursday while he hasn't been able to fully review a Supreme Court ruling limiting the power of his administration to conduct military tribunals for suspected terrorists imprisoned at the U.S.Navy base in Guantanamo Bay, Cuba he will "conform with the findings of the Supreme Court."

Bush appeared Thursday with visiting Japanese Prime Minister Junichiro Koizumi, and said he was with the Japanese leader when the ruling was made.

"To the extent there is latitude to work with the Congress to determine whether or not the military tribunals will be an avenue in which to give people their day in court, we will do so," Bush said. (Posted 12:08 p.m.)

Veterans secretary: Stolen laptop with military data has been recovered

WASHINGTON (CNN) -- A laptop computer and external drive containing personal data on over 26 million veterans and active duty military personnel has been recovered, Veterans Affairs Secretary Jim Nicholson said Thursday.

The laptop computer and external drive were stolen from a Veterans Affairs employee's home on May 3 but was returned to FBI Baltmore's field office Wednesday after a tip was called in, FBI spokeswoman Michelle Crnkovich said Thursday.

The FBI was not able to say who stole the laptop and no arrests have been made.

FBI forensic experts have conducted initial tests that showed nothing had been accessed since the equipment was stolen, but forensic examinations are still underway to ensure the safety of the information. (Posted 11:48 a.m.)

U.S. military: new al Qaeda in Iraq head 'our no. 1 target'

BAGHDAD (CNN) -- The U.S. military said the operations of al Qaeda in Iraq have been disrupted by coalition and Iraqi military activity, and the capture of the purported new head of the group would degrade it even further.

Maj. Gen. William Caldwell, spokesman for Multi-National Forces-Baghdad, on Thursday addressed this and other efforts to crush the foreign fighter element in Iraq.

The military has said it believes that Abu Ayyub al-Masri, an Egyptian-born terrorist, has replaced Abu Musab al-Zarqawi, who was killed in a U.S. airstrike earlier this month, as leader of al Qaeda in Iraq.

"I can tell you that we're working on that very diligently. He's our number one target. We have a lot of resources committed to finding him. And we'll continue working that one very hard," said Caldwell. (Posted 11:34 a.m.)

High court rules against government in military tribunals for suspected terrorists

From CNN Supreme Court Producer Bill Mears

WASHINGTON (CNN) -- In a stunning blow to executive authority, the Supreme Court on Thursday strongly limited the power of the Bush administration to conduct military tribunals for suspected terrorists imprisoned at the U.S. Navy base in Guantanamo Bay, Cuba.

The 5-3 ruling effectively means officials will either have to come up with new procedures to prosecute at least 10 "enemy combatants" awaiting trial, or release them from military custody.

At the center of the dispute was a Yemeni man, Salim Ahmed Hamdan, accused of being associated with al Qaeda leader Osama bin Laden.

The case was a major test of President Bush's authority as commander in chief in a wartime setting. Bush has aggressively asserted the power of the government to capture, detain and prosecute suspected terrorists in the wake of the Sept. 11, 2001, terrorist attacks. (Posted 10:57 a.m.)

Baby Noor back in Iraq

ATLANTA (CNN) -- Baby Noor, the 9-month-old Iraqi girl who was brought to the United States for lifesaving medical treatment after being discovered by U.S. soldiers in Baghdad, is back home.

The baby got the green light from doctors and began her journey back home on Monday, said Childspring International USA Director Christina Porter. Childspring is the charity that arranged the trip.

Noor arrived in Iraq on Wednesday in commercial and military flights. (Posted 10:26 a.m.)

Military in Iraq reports strides in retaking control of Ramadi

BAGHDAD (CNN) -- The U.S. military on Thursday reported progress in re-establishing control of Ramadi, the Anbar provincial capital that has had a strong insurgent presence in recent months.

"At this point, we're finding that we do have a continued presence now in the city that had not been the case prior to this operation," said Maj. Gen. William Caldwell, spokesman for the Multi-National Force Iraq.

The military official -- who noted that this week Iraq marks its second year of sovereignty in the post-Saddam Hussein era -- characterized the strides in the country as "24 months of measured but tangible progress." (Posted 9:31 a.m.)

Md. communities still evacuated because of floodwaters

WASHINGTON (CNN) -- Evacuated Montgomery County, Md., residents were still not allowed to return home Thursday morning because of slowly-receding floodwaters, authorities said.

The water is receding at the rate of about an inch and a half every one to two hours, Montgomery County Fire and Rescue spokesman Brian Geraci said. At its peak, the water rose to 25 feet above the normal level. It had fallen to about 18 feet above normal as of Wednesday night, Geraci said. Rain overnight was adding additional water, and rain is also expected later Thursday.

About 2,200 people evacuated Tuesday night, but some have returned home despite warnings against it, Geraci said. Police will be going back into the area to post flyers and check on residents.

"If you go back, you go back at your own risk," Geraci said. --CNN's Lauren Kornreich contributed to this report. (Posted 9:24 a.m.)

Zapatero says government will start dialogue with ETA

From CNN Madrid Bureau Chief Al Goodman

MADRID (CNN) - Spanish Prime Minister Jose Luis Rodriguez Zapatero said in parliament Thursday that the government will hold talks to secure a lasting peace with the Basque separatist group ETA, three months after ETA declared a cease-fire, indicating it was ready to end nearly 40 years of violence.

Zapatero's announcement, which he had promised to make in Parliament before the end of June, is expected to set in motion a round of secret direct talks during the summer involving government officials and ETA leaders, at an unspecified location and time, an aide to Zapatero told CNN.

"The government will start dialogue with ETA," said Zapatero, standing outside the parliament chamber. (Posted 8:42 a.m.)

Rice arrives in Moscow for G8 ministers meeting

MOSCOW (CNN) -- U.S. Secretary of State Condoleezza Rice arrived in Moscow Thursday to meet with Group of Eight foreign ministers, who are expected to focus on Iran's nuclear ambitions.

The meeting is a precursor to the annual G8 summit in St. Petersburg, Russia which will take place July 15-17.

The G8 includes the heads of the leading industrialized democracies -- Russia, the U.S., Britain, France, Japan, Germany, Canada and Italy. (Posted, 4:45 a.m.)

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