STATEMENT BY SECRETARY KERRY ON THE INTERNATIONAL DAY OF THE DISAPPEARED

FROM:  U.S. STATE DEPARTMENT 

International Day of the Disappeared

Press Statement

John Kerry

Secretary of State

Washington, DC

August 30, 2014

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Countless people around the world are haunted by the disappearance of a loved one. Those who vanished are neither alive nor dead. Their mothers and fathers, husbands and wives, family and friends are left without closure – neither able to mourn their loss nor rejoice in the safe return of their loved ones.

Today, we mark the 31^st International Day of the Disappeared and remember those individuals whose locations and fates remain unknown. Too often, lawyers, investigative journalists, and human rights activists fall victim to kidnapping for simply speaking the truth. That is unacceptable.

In Syria, thousands have disappeared at the hands of the Assad government. Violent extremist groups such as ISIL are ruthlessly targeting and disappearing innocent civilians in Syria and Iraq. In Nigeria, extremists kidnapped the Chibok girls from their school in the middle of the night. Such disappearances bring suffering to the victims and heartbreak to their families. They also create toxic atmospheres and breed terror within communities.

The State Department commends those men and women who work tirelessly to bring home missing individuals. The advancement of DNA sampling and analysis has helped reunite families who have suffered from unjust disappearances. Just last year the State Department helped to reunite a woman in Latin America who was abducted from her family during a massacre in 1982. She was only 18 months old at the time.

The United States and our international partners remain vigilant in our pursuit of those missing around the globe. They are missing, but never left behind. They are gone, but not lost. They are taken, but not forgotten.

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U.S. STATE DEPARTMENT TARGETS IRANIAN WMD PROLIFERATORS WITH SANCTIONS

FROM:  U.S. STATE DEPARTMENT 

Additional Sanctions Imposed by the Department of State Targeting Iranian Proliferators

Media Note

Office of the Spokesperson

Washington, DC

August 29, 2014

The Administration imposed sanctions today on a series of companies and individuals under various Iran-related authorities targeting those engaged in proscribed activities. These actions underscore U.S. resolve to enforce sanctions as the P5+1 and Iran work toward a comprehensive solution to address the international community’s concerns over Iran’s nuclear program. As part of the Joint Plan of Action (JPOA), which was extended in July, the P5+1 committed to providing Iran with limited, temporary, and targeted sanctions relief in return for important steps Iran took to constrain its nuclear program. The Department of State today imposed sanctions on a series of entities providing support to illicit Iranian nuclear activities. The Department of the Treasury announced additional actions under its authorities as well. Today’s actions target sanctionable activity beyond the scope of the relief offered to Iran as part of the JPOA.

Actions Targeting Weapons of Mass Destruction (WMD) Proliferators and Their Supporters

As part of these combined actions, the Department of State imposed sanctions on four companies pursuant to Executive Order (E.O.) 13382 for engaging in or attempting to engage in activities that have materially contributed to, or posed a risk of materially contributing to, the proliferation of WMD or their means of delivery. The Department of State’s designations comprise Iran-based entities engaged in efforts to support the development of nuclear weapons, or elements of Iran’s program that could be used to produce nuclear weapons.

Organization of Defensive Innovation and Research:

The Organization of Defensive Innovation and Research (SPND) is a Tehran-based entity that is primarily responsible for research in the field of nuclear weapons development. SPND was established in February 2011 by the UN-sanctioned individual Mohsen Fakhrizadeh, who for many years has managed activities useful in the development of a nuclear explosive device. Fakhrizadeh led such efforts in the late 1990s or early 2000s, under the auspices of the “AMAD Plan, the MODAFL subsidiary Section for Advanced Development Applications and Technologies (SADAT) and Malek Ashtar University of Technology (MUT). In February 2011, Fakhrizadeh left MUT to establish SPND. Fakhrizadeh was designated in UNSCR 1747 (2007) and by the United States in July 2008 for his involvement in Iran’s proscribed WMD activities. SPND took over some of the activities related to Iran’s undeclared nuclear program that had previously been carried out by Iran’s Physics Research Center, the AMAD Plan, MUT, and SADAT.

Nuclear Science and Technology Research Institute:

Iran’s Nuclear Science and Technology Research Institute (NSTRI) implements projects in the nuclear field, specifically at Iran’s 40-megawatt heavy water research reactor at Arak (the IR-40) - a reactor that, as presently designed, would provide Iran the capability to produce plutonium from the reactor’s spent fuelthe could be used in nuclear weapons. NSTRI has engaged with Modern Industries Technique Company (MITEC), an Iranian entity is responsible for design and construction of the IR-40, to produce lead glass for the hot cell facilities at the IR-40. This project would allow Iran, when reprocessing spent fuel, to contain radiation using high-density concrete walls to enclose the primary containment area, known as a “hot cell.” Hot cells with thick radiation shielding and leaden glass for direct viewing are adequate for research-scale plutonium extraction. NSTRI is a subordinate to the Atomic Energy Organization of Iran (AEOI), which is the primary Iranian organization responsible for nuclear technology research and development activities and was designated by the UNSC in resolution 1737 (2006) and by the United States in the annex to E.O. 13382. Further, MITEC was designated by the UNSC in resolution 1929 (2010) for its involvement in the design and construction of the IR-40, and by the United States pursuant to E.O. 13382 in November 2011 for providing services to the AEOI.

Jahan Tech Rooyan Pars and Mandegar Baspar Kimiya Company:

Jahan Tech Rooyan Pars (Jahan Tech) and Mandegar Baspar Kimiya Company (Mandegar Baspar) are Iran-based entities involved in the procurement of proliferation-sensitive material, specifically carbon fiber, for proscribed elements of Iran’s nuclear program. Since early 2010 and as recently as 2013, Jahan Tech and Mandegar Baspar have attempted to procure high-strength carbon fiber from Asia-based suppliers, some of which is controlled for export pursuant to the Nuclear Suppliers Group (NSG) Guidelines and is proscribed for export to Iran by UNSCR 1737. Among other uses, high-strength carbon fiber is suitable for the production of advanced centrifuge rotors, as well as for forming components that increase the range and payload capability of ballistic missiles. The Panel of Experts established pursuant to UNSCR 1929 (2010) noted in its May 2014 report that Iran has been attempting to procure high-grade carbon fiber for use in manufacturing of some of its centrifuge rotors. The Washington Post in 2013 documented Jahan Tech’s efforts to acquire 100,000 highly specialized magnets used in centrifuge machines – a quantity that could outfit 50,000 new centrifuges. Iranian private sector firms should heed the risks incurred by conducting business with those who support Iran’s proscribed nuclear activities and choose to focus their activities on legitimate international commerce. The United States will continue to investigate additional companies making material contributions to the Iranian government’s proliferation of weapons of mass destruction or their means of delivery

Actions Targeting Persons Engaging with the Energy or Petrochemical Sectors of Iran

Also today, the Department of State imposed sanctions pursuant to the Iran Freedom and Counter-Proliferation Act of 2012 (IFCA) on Goldentex FZE, a UAE-based company involved in providing support to Iran’s shipping sector.

IFCA mandates, among other things, the imposition of sanctions on individuals and companies determined to have knowingly transferred to or from Iran significant goods or services used in connection with the energy or shipping sector of Iran, including the National Iranian Oil Company or the National Iranian Tanker Company (NITC).

In addition, the Department of State took action to impose sanctions on Italy-based Dettin SpA pursuant to the Iran Sanctions Act of 1996 (ISA), as amended by the Iran Threat Reduction and Syria Human Rights Act of 2012 (TRA). According to information available to the United States, Dettin SpA knowingly providing Iran’s petrochemical industry with goods and support whose value exceeded $250,000. Although the JPOA authorizes Iran to export petrochemicals, providing goods, services, and support for the maintenance or expansion of Iran’s domestic production of petrochemicals is not within the scope of sanctions relief under the JPOA and, therefore, remains sanctionable.

These sanctions send a clear message that the United States will act resolutely against attempts to circumvent U.S. sanctions. Individuals and companies providing support to illicit Iranian nuclear activities program or engaged in assisting Iran’s efforts to evade U.S. sanctions will face serious consequences.

Identifier Information

Name: The Organization of Defensive Innovation and Research
AKA: SPND
Address: Negarestan 3, off of Pasdaran Street, Tehran, Iran

Name: The Nuclear Science and Technology Research Institute
AKA: NSTRI
AKA: Research Institute of Nuclear Science and Technology
AKA: Nuclear Science and Technology Research Institute
AKA: Nuclear Science and Technology Research Center
Address: P.O. Box 11365-3486, Tehran, Iran
Address: P.O. Box 14399-51113, Tehran, Iran
Address: North Karegar Ave., P.O. Box 14399/51113, Tehran, Iran
Address: Moazzen Blvd. Rajaee Shahr, Karaj, Iran, P.O. Box 31485-498
Address: End of Karegare Shomali Street, P.O. Box 11365-3486, Tehran, Iran

Name: Jahan Tech Rooyan Pars
AKA: Jahan Tech Rooyan Pars Company
AKA: Jahan Tech
Address: B18, Takhte-e-Jamshid Building, Science and Technology Park, Shiraz, Iran

Name: Mandegar Baspar Kimiya Company
AKA: Mandegar Baspar Fajr Asia
AKA: Bardiya Tejarat Javid
Address: No. 510, 5th Floor, Saddi Trading Building, South SAA DI Street, Tehran, Iran

Name: Goldentex FZE
Address: M05 Bin Thani BLD, Sheikh Khalifah Bin Zayed Road, Burdubai, Dubai, United Arab Emirates

Name: Dettin SpA
Address: Via Campania, 9 – 36015 Schio (4543N 11221E) Italy

EXPORT-IMPORT BANK TOUTS PARTNERSHIP WITH FLORIDA AND WASHINGTON STATE TO HELP SMALL BUSINESSES

FROM:  U.S. EXPORT-IMPORT BANK 

Small Business Success of the Week: Florida and Washington State Partner with Export-Import Bank US to Help Local Businesses Grow

WASHINGTON, D.C. – Two state agencies looking to help their local businesses grow joined forces with the Export-Import Bank of the United States (Ex-Im Bank) through the Bank’s City/State Partner program, to better prepare their small businesses to create jobs through exports. The Florida Export Finance Corporation (FEFC) and the Export Finance Assistance Center of Washington State are working with small businesses in their states to determine which Ex-Im products would be best for their needs.

“Our strategic partnerships with regional economic development organizations, private lenders, and advisors are opening new doors for small businesses in communities across America,” said Ex-Im Bank Chairman and President Fred P. Hochberg. “The goal of the City/State Partners program is to ensure that more small businesses and entrepreneurs know how Ex-Im Bank products can equip local companies to grow their sales and add U.S. jobs through exports.”

In Florida, Florida Export Finance Corporation staff worked with Gus Vidauretta, co-founder of Top Secret Nutrition, to develop financial solutions for his small business. Working together, they identified Ex-Im Bank’s Global Credit Express program as a great way to expand the reach of Top Secret Nutrition. Global Credit Express enables exporters to set up a revolving line of credit in amounts up to $500,000, at no cost to taxpayers. Gus and his team subsequently created three new, dedicated product lines for markets in the UK, Italy, and Brazil.

“Ex-Im has been a key partner in several ways,” said Vidauretta. “Top Secret Nutrition first worked with the insurance side of Ex-Im. Our ability to export and our level of security were both enhanced by the fact that our exports were insured. Later we applied and received a loan from Ex-Im to create inventory for export. Ex-Im is an incredible asset and partner to businesses like mine.”

In Washington State, Whooshh Innovations, developers of an innovative product for transporting live fish and delicate fruit needed capital to complete orders from overseas buyers. With a slim history of financing export sales, rising orders created a funding gap between the capital Whooshh needed to produce its machinery, and what commercial banks were willing to put at risk. Doug Kemper, advising on behalf of Export Finance Assistance Center, matched his client’s need with the Bank’s Global Credit Express program. The loan enabled Whooshh to increase its production capacity, in order to fulfill the foreign buyers’ demand. Combining the financing with Ex-Im export credit insurance gave Whooshh flexibility to offer open account credit terms to make their export sales more competitive.

Kemper called Ex-Im’s Global Credit Express the perfect fit for Whooshh Innovations, which is “now on the cusp of some significant international sales.” Kemper’s office and other strategic partnerships plan to repeat that success. “This is a very unusual product that was created by [Ex-Im] Bank to fulfill a need that is definitely in the marketplace,” he said. “The relationship with Ex-Im is excellent. GCE is very creative, and the support and backing by the Bank – the willingness to help – is certainly there.”

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DOE SPENDS $67 MILLION FOR NUCLEAR ENERGY RESEARCH AND INFRASTRUCTURE ENHANCEMENTS

FROM:  U.S. ENERGY DEPARTMENT 

Energy Department Invests $67 Million to Advanced Nuclear Technology

August 20, 2014 - 12:00pm

WASHINGTON – Building on President Obama’s Climate Action Plan and the Administration’s efforts to expand clean energy innovation, the Energy Department announced today nearly $67 million in nuclear energy research and infrastructure enhancement awards. 83 projects were selected from across the country based on their potential to create scientific breakthroughs that both help strengthen the nation’s energy security and reduce harmful greenhouse gas emissions.

“The Department’s support for cutting-edge nuclear science and engineering across our universities, national laboratories, and industry reflects the key role of nuclear energy in helping ensure America’s low carbon future,” said Energy Secretary Ernest Moniz. “These awards not only provide crucial funding for research and development, but also for the training and education of the next generation nuclear energy workforce that will enhance American leadership in the safe, secure and efficient use of nuclear energy here and around the world.”

As part of the announcement, the Energy Department is awarding over $30 million through its Nuclear Energy Research Programs (NEUP) to support 44 university-led nuclear energy research and development projects to develop innovative technologies and solutions. These projects will be led by 30 U.S. universities in 24 states. Today’s announcement also includes approximately $4 million to 19 universities for research reactor and infrastructure improvements – providing important safety- performance- and student education-related upgrades to the nation’s 25 university research reactors as well as enhancing university research and training infrastructure.

The Energy Department is also awarding $20 million for 5 Integrated Research Projects (IRPs) that will deliver solutions to high priority nuclear energy research challenges, including instrumentation and vacuum drying systems associated with the storage of used nuclear fuel, an integrated approach to fluoride high temperature reactor technology development, and advanced instrumentation to support transient testing.

Additionally, $11 million will be awarded for 12 research and development projects led by U.S. universities, Department of Energy national laboratories and industry in support of the Nuclear Energy Enabling Technologies Crosscutting Technology Development Program (NEET CTD) to address crosscutting nuclear energy challenges. 2 infrastructure enhancement projects totaling over $1 million will be awarded to Department of Energy national laboratories to further reactor materials and instrumentation research.

Since 2009, the Energy Department’s Office of Nuclear Energy has awarded approximately $350 million to 98 U.S. colleges and universities to continue American leadership in clean energy innovation and to train the next generation of nuclear engineers and scientists through its university programs. Visit neup.gov for more information on today’s awards and Energy.gov for information on all of the Energy Department’s efforts to continue American leadership in low-carbon nuclear energy innovation.

FDA COMPLETES REVIEW OF HOW AGENCY EVALUATES HARMFUL CHEMICALS IN PRODUCTS

FROM:  U.S. FOOD AND DRUG ADMINISTRATION 

FDA Takes Steps to Strengthen Program to Assess the Safety of Chemicals in Foods, Other Products

August 28, 2014

The U.S. Food and Drug Administration has completed a review of how the agency evaluates the harmful effects of chemicals in foods, cosmetics, dietary supplements, animal food/feed and veterinary drugs. Based on the findings, the agency is taking steps to strengthen internal processes.

The chemical safety assessment review is the first of three planned strategic reviews being conducted under the direction of the FDA’s Office of Foods and Veterinary Medicine (OFVM). The other two focus on nutrition and microbiological laboratory programs.

The FDA conducted the chemical safety assessment review in order to ensure that the agency is making the most effective and efficient use of its chemical safety resources. The review focused on the scientific capacity and management of the program’s multiple elements across the Center for Food Safety and Applied Nutrition (CFSAN) and the Center for Veterinary Medicine (CVM). Initiated in 2012, the review included interviews of current and former FDA employees involved in all aspects of the agency’s chemical safety assessment program, as well as senior managers from other U.S. government agencies experienced in chemical safety assessment, and five listening sessions conducted by CFSAN with internal and external stakeholders on OFVM’s overall chemical safety assessment program. In addition, four outside consultants, all of whom are considered experts in the field, and who had previously held senior management positions dealing with chemical safety assessment in the Federal government, met with OFVM and senior CFSAN managers to discuss the interview and listening session reports. Based on this discussion and their review of the interview and listening session reports, each consultant also made his or her own written recommendations for OFVM’s chemical safety program.

Working groups were formed in CFSAN and CVM to review all the reports and consultant recommendations. The issues and recommendations identified in the workgroup reports fall into three overarching categories (Science, Communication and Collaboration, and Training and Expertise).

Among the review’s most significant outcomes: the centers, led by CFSAN, will develop a process for updating FDA’s Toxicological Principles for the Safety Assessment of Food Ingredients (also called the “Redbook”), so that it reflects current science. Additionally, the centers will jointly develop a process to ensure consistency of methodologies used for safety and risk assessments within and across offices at CFSAN, and between CFSAN and CVM.

SECRETARY KERRY'S STATEMENT REGARDING U.S. CITIZENS IN IRAN

FROM:  U.S. STATE DEPARTMENT 

U.S. Citizens Detained or Missing in Iran

Press Statement

John Kerry

Secretary of State

Washington, DC

August 29, 2014

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U.S. Citizens Detained or Missing in Iran

The Unites States respectfully calls on the Government of the Islamic Republic of Iran to release Amir Hekmati, Saeed Abedini, and Jason Rezaian to their families and work cooperatively with us to find Robert Levinson and bring him home.

Today marks the three-year anniversary of U.S. citizen Amir Hekmati’s detention on false espionage charges while visiting his family in Iran.  Mr. Hekmati is the eldest son; he has long been separated from his family and they need him home.

Mr. Levinson went missing in March 2007 on Kish Island.  His family has endured years of painful separation and worry.  We are immensely concerned about his well-being and whereabouts.

On September 26, Mr. Abedini will have been detained for two years in Iran, on charges related to his religious beliefs.  Mrs. Abedini has spoken eloquently about the difficulties her family has faced during this challenging time.

Mr. Rezaian, a reporter for the Washington Post, is being detained in an unknown location.  His love of Iran is seen in his reporting – portraits of the generosity and kindness of the Iranian people.

The United States remains committed to returning all of them to their families, friends, and loved ones.  We ask the Government of the Islamic Republic of Iran to immediately release Amir Hekmati, Saeed Abedini, and Jason Rezaian and respectfully request the Government of the Islamic Republic of Iran work cooperatively with us to find Mr. Levinson and bring him home.

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OWNER, EMPLOYEES OF MORTGAGE COMPANY, TWO REAL ESTATE DEVELOPERS INDICTED FOR ROLES IN $50 MILLION MORTGAGE SCAM

FROM:  U.S. JUSTICE DEPARTMENT 

Thursday, August 28, 2014

Owner and Seven Employees of Mortgage Company and Two Real Estate Developers Indicted for $50 Million Scam Involving Federally Insured Mortgages

The owner of a Florida mortgage company, seven employees of the company and two real estate developers were indicted in the Southern District of Florida in connection with an alleged $50 million mortgage fraud scheme.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida and David A. Montoya, Inspector General for the Department of Housing and Urban Development (HUD) made the announcement.

Hector Hernandez, 56, of Miami, Florida, the owner and operator of Great Country Mortgage Bankers (Great Country), a mortgage lender in Miami, was charged with one count of conspiracy to commit wire fraud affecting a financial institution and 25 counts of wire fraud affecting a financial institution.   Great Country loan officers Durand Deeb, 43, of Miami, Frank Carino, 48, of Apollo Beach, Florida, and Fabian Perez, 39, of Miami; Great Country loan processors Juliette Del Rio, 37, of Miami, and Julissa Saavedra, 43, of Miami,; Great Country underwriters Olga Hernandez, 58, of Lake Mary, Florida, and Olga Rodriguez, 53, of Miami; and real estate developers Armando Bravo, 42, of Coral Gables, Florida, and Aleida Fontao, 61, of Miami, were also indicted for conspiracy to commit wire fraud affecting a financial institution and varying counts of wire fraud affecting a financial institution.

According to the indictment, beginning in January 2006 and continuing through September 2008, Hernandez and others allegedly obtained mortgage loans insured by the Federal Housing Administration (FHA), a division of HUD, for unqualified borrowers by exaggerating the borrowers’ income and otherwise misrepresenting their financial condition.

Specifically, Hernandez and others allegedly created false documents on behalf of borrowers who could not otherwise qualify for FHA-insured loans due to insufficient income, high levels of debt, and outstanding collections.   These documents included bogus earnings statements that inflated the borrowers’ income and false verification of employment forms that overstated their work histories.

In addition to creating these false documents, Hernandez and others allegedly offered the unqualified borrowers cash back after closing as an incentive to purchase condominiums.   These secret payments were not disclosed in the loan applications and were omitted from loan closing documents so that HUD and the financial institutions that subsequently purchased the loans would not know of their existence.

By later selling the fraudulent loans to financial institutions, Great Country transferred the risk of loss to those institutions .   The vast majority of the unqualified borrowers failed to meet their monthly mortgage obligations and defaulted on their loans.   When the loans went into foreclosure, HUD, which insured the loans, was required to pay the outstanding balances to the financial institutions, resulting in losses in excess of $50 million to the agency.

The charges contained in an indictment are merely accusations, and a defendant is presumed innocent unless and until proven guilty.

This case is being investigated by HUD’s Office of Inspector General with assistance from the U.S. Marshals Service, Miami-Dade Police Department Warrants Bureau and Miami-Dade State Attorney’s Office – Public Corruption Task Force.   This is being prosecuted by Senior Litigation Counsel David A. Bybee and Trial Attorney Michael T. O’Neill of the Criminal Division’s Fraud Section.

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SEC CHARGES TWO IT COMPANY EXECUTIVES WITH "MISCHARACTERIZEING AN ARRANGEMENT"

FROM:  U.S. SECURITIES AND EXCHANGE COMMISSION 

The Securities and Exchange Commission today charged two executives at a Dallas-based information technology company with mischaracterizing an arrangement with an equipment manufacturer to purport that it was conducting so-called “resale transactions” to inflate the company’s reported revenue.

An SEC investigation found that then-CEO Lynn R. Blodgett and then-CFO Kevin R. Kyser caused the disclosure failures at Affiliated Computer Services (ACS), which has since been acquired by Xerox Corporation.  ACS provided business process outsourcing and information technology services.  Shortly before the end of its first quarter in fiscal year 2009, ACS faced a scenario where the company’s revenue was set to fall short of company guidance and consensus analyst expectations, so ACS arranged for an equipment manufacturer to re-direct through ACS pre-existing orders that the manufacturer already had received from one of its customers.  This gave the appearance that ACS was involved in resale transactions, but ACS in fact had no such involvement.  ACS went on to report $124.5 million in fiscal year 2009 revenue from these transactions as though it had resold the equipment itself.

Blodgett and Kyser have agreed to pay nearly $675,000 to settle the SEC’s charges that they and ACS did not adequately describe the arrangement in its financial reporting, and the purported revenue in turn allowed ACS to publicly report inflated internal revenue growth (IRG).  Blodgett and Kyser emphasized the inflated IRG as a key metric in earnings releases and other public statements to investors, and a portion of their annual bonuses was linked to IRG.
“ACS positioned itself in the middle of pre-existing transactions without adding value, but still improperly reported the revenue. Blodgett and Kyser knew the truth about these deals, and they were responsible for ensuring that ACS accurately disclosed the full story to investors,” said David R. Woodcock, director of the SEC’s Fort Worth Regional Office and chair of the agency’s Financial Reporting and Audit Task Force.  “This enforcement action holds them accountable for failing to uphold that responsibility.”

Blodgett and Kyser consented to the SEC’s order to cease-and-desist from violating Sections 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Securities Exchange Act of 1934, and Rules 12b-20, 13a-1, 13a-11, 13a-13, and 13a-14.  Without admitting or denying the findings, they have agreed to collectively disgorge IRG-related bonuses plus prejudgment interest totaling $569,327, and they each must pay $52,000 penalties.

The SEC’s investigation was conducted by James E. Etri, Todd B. Baker, and David R. King of the Fort Worth office.

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SYRIAN NATIONAL AND SUSPECTED TERRORIST EXTRADITED TO U.S. TO FACE CHARGES

FROM:  U.S. DEPARTMENT OF JUSTICE 

Thursday, August 28, 2014

Defendant Extradited to U.S. to Face Terrorism Charges

Ahmad Ibrahim Al-Ahmad made his initial appearance today in federal court in Phoenix, Arizona, on federal terrorism offenses, announced John P. Carlin, Assistant Attorney General for National Security, John S. Leonardo, U.S. Attorney for the District of Arizona and Douglas G. Price, Special Agent in Charge, FBI Phoenix Division.   The charges stem from Al-Ahmad’s alleged participation in a conspiracy to use improvised explosive devices (IEDs) to attack U.S. military personnel in Iraq from approximately 2005 to 2010.

Al-Ahmad was originally charged under seal with terrorism-related offenses in May 2011.   He was subsequently arrested in Turkey on May 17, 2011, based upon those charges and an Interpol Red Notice, and was detained there pending completion of extradition proceedings.   Al-Ahmad was extradited from Turkey yesterday and arrived in Arizona on the same day.

Following his appearance, Al-Ahmad was placed in custody of the U.S. Marshals Service, pending a status conference on the issue of detention on Sept. 8, 2014.  A trial date is set for Oct. 7, 2014.

On Aug. 12, 2014, a federal grand jury in the District of Arizona returned a superseding indictment charging Ahmad Ibrahim Al-Ahmad, a Syrian national, with multiple charges related to Al-Ahmad’s alleged participation in a conspiracy, from approximately 2005 to 2010, to supply component parts to the 1920 Revolution Brigades – an Iraqi insurgent group – for use in IEDs that were employed against U.S. military personnel in Iraq during that time period.   The charges include conspiracy to use a weapon of mass destruction (IEDs); conspiracy to maliciously damage or destroy U.S. government property by means of an explosive; possession of a destructive device during a crime of violence and aiding and abetting; conspiracy to commit extraterritorial murder of a U.S. national, and providing material support to terrorists.

If convicted of the offenses alleged in the indictment, Al-Ahmad would face a statutory maximum sentence of life in prison.

An indictment is merely a formal allegation that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until and unless proven guilty.

This case is being investigated by the FBI Phoenix Division Joint Terrorism Task Force with substantial assistance from various other government agencies.   The case is being prosecuted by the U. S. Attorney’s Office for the District of Arizona and the Counterterrorism Section of the Justice Department’s National Security Division.   The Justice Department’s Office of International Affairs also provided significant assistance in this matter.

PRESIDENT OBAMA DELIVERS A STATEMENT ON ECONOMY, IRAQ, AND UKRAINE

U.S. ATTACKS ISIL TERRORISTS NEAR MOSUL DAM

FROM:  U.S. DEFENSE DEPARTMENT 

U.S. Conducts Airstrikes Against ISIL Near Mosul Dam

From a U.S. Central Command News Release

WASHINGTON, Aug. 28, 2014 – U.S. military forces continued to attack ISIL terrorists in support of Iraqi security force operations, using fighter aircraft to conduct five airstrikes in the vicinity of the Mosul Dam.

The strikes destroyed an ISIL Humvee, a tank, four armed vehicles, an ISIL construction vehicle and severely damaged an ISIL checkpoint. All aircraft exited the strike areas safely.

The strikes were conducted under authority to support Iraqi security force and Kurdish defense force operations, as well as to protect critical infrastructure, U.S. personnel and facilities, and support humanitarian efforts.

Since Aug. 8, U.S. Central Command has conducted a total of 106 airstrikes across Iraq.

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FDIC REPORTS Q2 AGGREGATE COMMERCIAL BANK AND SAVINGS INSTITUTION NET INCOME OF $40.2 BILLION

FROM:  U.S. FEDERAL DEPOSIT INSURANCE CORPORATION 

Commercial banks and savings institutions insured by the Federal Deposit Insurance Corporation (FDIC) reported aggregate net income of $40.2 billion in the second quarter of 2014, up $2.0 billion (5.3 percent) from earnings of $38.2 billion the industry reported a year earlier. The increase in earnings was mainly attributable to a $1.9 billion (22.4 percent) decline in loan-loss provisions and a $1.5 billion (1.4 percent) decline in noninterest expenses. Also, strong loan growth contributed to an increase in net interest income compared to a year ago. However, lower income from reduced mortgage activity and a drop in trading revenue contributed to a year-over-year decline in noninterest income. More than half of the 6,656 insured institutions reporting (57.5 percent) had year-over-year growth in quarterly earnings. The proportion of banks that were unprofitable during the second quarter fell to 6.8 percent from 8.4 percent a year earlier.

"We saw further improvement in the banking industry during the second quarter," FDIC Chairman Martin J. Gruenberg said. "Net income was up, asset quality improved, loan balances grew at their fastest pace since 2007, and loan growth was broad-based across institutions and loan types. We also saw a large decline in the number of problem banks. However, challenges remain. Industry revenue has been under pressure from narrow net interest margins and lower mortgage-related income. Institutions have been extending asset maturities, which is raising concerns about interest-rate risk. And banks have been increasing higher-risk loans to leveraged commercial borrowers. These issues are matters of ongoing supervisory attention. Nonetheless, on balance, results from the second quarter reflect a stronger banking industry and stronger community banks."

Total loan and lease balances rose by $178.5 billion (2.3 percent) in the second quarter to $8.1 trillion. This is the largest quarterly increase since the fourth quarter of 2007. Commercial and industrial loans increased by $49.9 billion (3.1 percent), residential mortgage loans rose by $22.7 billion (1.2 percent), credit card balances were up by $20.0 billion (3.0 percent), and auto loans grew by $10.9 billion (3.0 percent). Over the last 12 months, loan and lease balances increased by 4.9 percent, the highest 12-month growth rate since before the recent financial crisis.

Asset quality indicators continued to improve as insured banks and thrifts charged off $9.9 billion in uncollectible loans during the quarter, down $4.1 billion (29.5 percent) from a year earlier. The amount of noncurrent loans and leases (those 90 days or more past due or in nonaccrual status) fell by $13.4 billion (6.9 percent) during the quarter. The percentage of loans and leases that were noncurrent declined to 2.24 percent, the lowest level since the 2.09 percent posted at the end of the second quarter of 2008.

Despite the quarterly increase in mortgage balances, income from mortgage-related activity remained well below the level of a year earlier. Noninterest income from the sale, securitization and servicing of mortgages was $3.7 billion (42.5 percent) lower than a year ago. One- to four-family residential real estate loans originated and intended for sale during the quarter were $290.6 billion (63.9 percent) lower than in the second quarter of 2013, as higher interest rates reduced the demand for mortgage refinancing. Realized gains on securities sales also were lower than a year ago, as higher medium- and long-term interest rates reduced the market values of fixed-rate securities. Banks reported $770 million in pretax income from realized gains in the second quarter, a decline of $601 million (43.8 percent) from the second quarter of 2013.

Second quarter net operating revenue (the sum of net interest income and total noninterest income) of $169.0 billion was $1.5 billion (0.9 percent) lower than a year earlier, as a $2.0 billion (1.9 percent) increase in net interest income was outweighed by a $3.6 billion (5.3 percent) drop in noninterest income. The average net interest margin (the difference between the average yield banks earn on loans and other investments and the average cost of funding those investments) was 3.15 percent, the lowest since 3.11 percent in the third quarter of 1989, as declining asset yields at larger institutions outpaced the decline in the cost of funds.
Noninterest expenses for goodwill impairment declined by $4.4 billion, and expenses for salaries and employee benefits were $399 million (0.8 percent) lower than in the second quarter of 2013. Banks set aside $6.6 billion in provisions for loan losses, down 22.4 percent from $8.5 billion a year earlier. This is the 19th consecutive quarter that the industry has reported a year-over-year decline in loss provisions.

The average return on assets (ROA) rose slightly to 1.07 percent in the second quarter from 1.06 percent a year earlier. The average return on equity (ROE) rose from 9.46 percent to 9.54 percent.

Financial results for the second quarter of 2014 are contained in the FDIC's latest Quarterly Banking Profile, which was released today. Also among the findings:

Community banks earned $4.9 billion during the quarter. In the last Quarterly Banking Profile, the FDIC added a new section that reports on the performance of community banks – those institutions that provide traditional, relationship-based banking services in their local communities. Based on criteria developed for the FDIC Community Banking Study published in December 2012, there were 6,163 community banks (93 percent of all FDIC-insured institutions) in the second quarter of 2014 with assets of $2.0 trillion (13 percent of industry assets). Second quarter net income at community banks of $4.9 billion was up $166 million (3.5 percent) from a year earlier, driven by higher net interest income and lower loan loss provisions. The report also found that loan balances at community banks in the second quarter grew at a faster pace than in the industry as a whole, asset quality indicators continued to show improvement, and community banks again accounted for 45 percent of small loans to businesses.

The number of "problem banks" fell for the 13th consecutive quarter. The number of banks on the FDIC's "Problem List" declined from 411 to 354 during the quarter. The number of "problem" banks now is 60 percent below the post-crisis high of 888 at the end of the first quarter of 2011. Seven FDIC-insured institutions failed in the second quarter, compared to 12 in the second quarter of 2013.

The Deposit Insurance Fund (DIF) balance continued to increase. The DIF balance — the net worth of the Fund — rose to $51.1 billion as of June 30 from $48.9 billion at the end of March. Assessment income was the primary contributor to the growth in the Fund balance. Estimated insured deposits declined by 0.2 percent, and the DIF reserve ratio (the Fund balance as a percentage of estimated insured deposits) rose to 0.84 percent as of June 30 from 0.80 percent as of March 31. A year ago, the DIF reserve ratio was 0.64 percent. By law, the DIF must achieve a minimum reserve ratio of 1.35 percent by 2020.

DOD VIDEO: DOD NEWS NOW: 1500 AUGUST 27, 2014

FORMER ELECTED OFFICIAL ADMITS TO TAKING MONEY FROM PRESIDENTIAL CAMPAIGN COMMITTEE TO SWITCH SIDES

FROM:  U.S. JUSTICE DEPARTMENT 
Wednesday, August 27, 2014

Former Iowa State Senator Pleads Guilty to Concealing Federal Campaign Expenditures

A former Iowa State Senator pleaded guilty today to concealing payments he received from a presidential campaign in exchange for switching his support and services from one candidate to another and to obstructing a subsequent investigation into his conduct.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Acting Assistant Director in Charge Timothy A. Gallagher of the FBI’s Washington Field Office made the announcement.

“An elected official admitted that he accepted under-the-table payments from a campaign committee to secure his support and services for a candidate in the 2012 presidential election,” said Assistant Attorney General Caldwell.   “Campaign finance reports should be accurate and transparent, not tools for concealing campaign expenditures.   Lying by public officials – whether intended to obstruct the FEC or federal investigators – violates the public trust and the law, and the Department of Justice does not tolerate it.”

“Today, Mr. Sorenson has taken responsibility for his crimes,” said Acting Assistant Director in Charge Gallagher.  “Exploiting the political process for personal gain will not be tolerated, and we will continue to pursue those who commit such illegal actions.”

Kent Sorenson, 42, of Milo, Iowa, pleaded guilty today to one count of causing a federal campaign committee to falsely report its expenditures to the Federal Election Commission (FEC) and one count of obstruction of justice in connection with the concealed expenditures.   The guilty plea was taken by Chief Magistrate Judge Celeste F. Bremer of the Southern District of Iowa for later review by Senior District Court Judge Robert W. Pratt.   Sentencing will be scheduled at a later date.

According to a statement of facts filed with the plea agreement, Sorenson admitted that he had supported one campaign for the 2012 presidential election, but from October to December 2011, he met and secretly negotiated with a second political campaign to switch his support to that second campaign in exchange for concealed payments that amounted to $73,000.   On Dec. 28, 2011, at a political event in Des Moines, Iowa, Sorenson publicly announced his switch of support and work from one candidate to the other.

The payments included monthly installments of approximately $8,000 each and were concealed by transmitting them to a film production company, then through a second company, and finally to Sorenson and his spouse.  In response to criticism of his change of support for the candidates, Sorenson gave interviews to the media denying allegations that he was receiving any money from the second campaign committee, and noted that the committee’s FEC filings would show that the committee made no payments to him.

In his plea agreement, Sorenson also admitted that he gave false testimony to an independent counsel appointed at the request of the Iowa Senate Ethics Committee, which was investigating allegations from a former employee of the first presidential campaign.  Sorenson testified falsely to the independent counsel about the concealed payments, in part to obstruct investigations that he anticipated by the FBI and FEC .

The case is being investigated by the FBI’s Washington Field Office, with assistance from the Omaha Field Office and the Des Moines Resident Agency.   The case is being prosecuted by Election Crimes Branch Director Richard C. Pilger and Trial Attorney Robert J. Higdon Jr. of the Criminal Division’s Public Integrity Section.

8/27/14: White House Press Briefing

"YOUR BABY CAN READ" DEFENDANTS SETTLE FTC CHARGES OF MAKING BASELESS CLAIMS

FROM:  U.S. FEDERAL TRADE COMMISSION 

Defendants Settle FTC Charges Related to “Your Baby Can Read” Program

Your Baby Can Read creator, Dr. Robert Titzer, and his company, Infant Learning, Inc. d/b/a The Infant Learning Company have settled charges that they made baseless claims about the effectiveness of the Your Baby Can Read program and misrepresented that scientific studies proved the claims.

The program was widely touted in infomercials and on the Internet, and used videos, flash cards, and lift-a-flap books that supposedly taught children as young as nine months old how to read. Two of the four defendants, Hugh Penton, Jr. and Your Baby Can LLC, named in the FTC's 2012 complaint previously settled with the FTC.

The stipulated final order announced today prohibits Titzer and his company from making any unsubstantiated claims about the performance or efficacy of any product that teaches reading. It also prohibits them from using the term “Your Baby Can Read,” bars them from misrepresenting the results of any tests or research, and prohibits Titzer from endorsing any product unless he has a reasonable basis for the claims made. Finally, the order imposes two monetary judgments against Titzer and his company totaling more than $185 million, which will be suspended after he pays $300,000.

“Marketers and expert endorsers must have adequate substantiation for the claims they make, and the FTC will continue to pursue those who fail to abide by this basic rule,” said Jessica Rich, Director of the Commission’s Bureau of Consumer Protection.

According to the FTC’s 2013 amended complaint, beginning in 2008 the marketers of Your Baby Can Read sold the program to parents and grandparents of children between three months and five years old, directly via a toll-free number and through websites, charging about $200 for each kit, and earning more than $185 million.

The amended complaint alleged the defendants failed to have competent and reliable scientific evidence that babies can learn to read using the Your Baby Can Read program, or that children who used the program can read books such as Charlotte’s Web or Harry Potter by age three or four. The amended complaint also charged Titzer with making deceptive expert endorsements for the program.

The Commission vote approving the settlement was 5-0. The FTC filed the proposed final order in the U.S. District Court for the Southern District of California on August 18, 2014, and the court entered it the next day.

NOTE: Stipulated orders have the force of law when approved and signed by the District Court judge.

EX-IM BANK AUTHORIZES ALMOST $65 MILLION IN LOANS FOR WIND POWER PROJECTS IN PERU

FROM:  U.S. EXPORT-IMPORT BANK 

Ex-Im Financing Supports the Export of Wind Turbines made in Kansas and Iowa to Peru

The sale will support approximately 800 jobs in those states

Washington, D.C. – The Export-Import Bank of the United States (Ex-Im Bank) has authorized a pair of direct loans to two wind power projects in Peru for the export of wind turbines manufactured in Hutchinson, Kan., and Fort Madison, Iowa, by Siemens Energy Inc.  

The financing, almost $65 million in total, represents Ex-Im Bank’s first renewable-energy transactions in Peru and will support approximately 800 U.S. jobs in Kansas and Iowa, according to bank estimates derived from Departments of Commerce and Labor data and methodology. Additionally, 20 percent of each transaction should provide indirect support to small-business exporters.

“These transactions reflect our continued commitment to increasing U.S. renewable energy exports while supporting good-paying jobs here at home,” said Ex-Im Bank Chairman and President Fred P. Hochberg. “During this fiscal year alone, Ex-Im Bank has approved financing for five wind farm projects, and we are looking to do more in the near future. This financing helps ensure that the turbines helping to power Peru are made here in the U.S. by American workers, rather than in a competing country.”

The wind turbines are destined for use in the Marcona wind project and the Tres Hermanas wind project, which are located in close proximity in the Ica region of southern Peru and are estimated to yield an aggregate 129 Mega Watts. Repayment terms are 17.3 years for the Marcona project and 16.6 years for the Tres Hermanas project, respectively.

Siemens Energy Inc. is a U.S. subsidiary of Siemens AG, an engineering company that operates in the industry, energy, healthcare, and infrastructure and cities sectors. The company reported revenue of $5.9 billion in exports and employs approximately 52,000 people throughout all 50 states and Puerto Rico.

“In addition to manufacturing wind turbine blades in Iowa and assembling nacelles in Kansas for projects across the United States, we’ve been able to successfully export our equipment to Americas wind projects in Canada, Chile, Brazil and with Ex-Im Bank’s help, Peru, ” said Mark Albenze, CEO of Siemens’ Onshore Wind Americas business. “Being able to export our equipment has helped support more than 800 manufacturing jobs in the heartland of the U.S. at a time when the U.S. wind market continues to be beleaguered by policy uncertainty.”

In FY 2013 alone, Ex-Im Bank authorized $257 million to support renewable energy exports, primarily to Central and Latin America.

LABOR UNION OFFICIAL PLEADS GUILTY TO THEFT FROM LABOR ORGANIZATION

FROM:  U.S. JUSTICE DEPARTMENT 

Thursday, August 28, 2014

Former Secretary-Treasurer Pleads Guilty to Theft of Union Treasury Funds

The former Secretary-Treasurer of Security Police Fire Professionals of America Local 287 pleaded guilty today to theft from a labor organization in violation of his fiduciary responsibilities as a union officer.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and District Director Mark Wheeler of the Department of Labor, Office of Labor-Management Standards, Washington District Office made the announcement.

Milton Hilliard, 47, of Fort Washington, Maryland, was the Secretary-Treasurer of Local 287, which represents security guards employed by Coastal International Security at various locations in Washington, D.C.   At the plea hearing, he acknowledged that, between September 2008 and December 2010, he made dozens of unauthorized personal purchases using union funds.   Specifically, he used the Local 287 debit card to purchase $11,303.92 in personal items at places such as Bed Bath & Beyond, Best Buy, Maryland Speedy Tag & Title, DARCARS Toyota, H&R Block, Golden Corral, Five Below and others.   During the same period, Hilliard made 29 unauthorized cash withdrawals, totaling $23,308.50, from the Local 287 treasury.

Hillard pleaded guilty before U.S. District Judge Tanya S. Chutkan in the District of Columbia.   Sentencing is set for Nov. 18, 2014.

The investigation was conducted by the Department of Labor, Office of Labor-Management Standards, Washington District Office.   The case is being prosecuted by Trial Attorney Vincent J. Falvo Jr. of the Criminal Division’s Organized Crime and Gang Section.

NSF FUNDS SCIENTIST STUDYING USE OF LIQUID METALS IN ELECTRONICS

FROM:  NATIONAL SCIENCE FOUNDATION 

Changing the shape and function of liquid metal

Researchers study gallium to design adjustable electronic components, including new types of antennas

Gallium is one of the few metals that turns into a liquid at room temperature. When that happens, its surface oxidizes, forming a "skin" over the fluid, almost like a water balloon or a water bed. Years ago, scientists often thought the coating a nuisance. Today they consider it an opportunity.

"We are trying to flip conventional wisdom on its head," says Michael Dickey, associate professor of chemical and bio-molecular engineering at North Carolina State University. "We are taking an old material and using it in a new way."

The National Science Foundation (NSF)-funded scientist is exploring ways to manipulate and modify this liquid metal in order to mold it into functional structures, in electronics, for example, that result in soft, flexible and stretchable and reconfigurable components, such as antennas.

One potential application could be to find a way to put the liquid gallium (actually an alloy of gallium and indium, the latter keeps the gallium from freezing) into already stretchable material in order to provide conductivity.

"If you put aluminum into a rubber band, it will behave mechanically like aluminum," Dickey explains. "But if you put liquid metal into a rubber band, you have the metal conductivity, which you want, but you still have the properties of the rubber band. We are taking advantage of the fact that this metal forms this oxide layer in order to control its shape."

By better understanding the mechanical properties of the liquid gallium, including learning whether it is possible to modify the "skin" itself--by making it stronger or even weaker, for example--it might be possible to design electronic components that can be "adjustable," that is, that can alter their functions as needed, he says.

"If you can change the shape, you can change the function," he says, adding that new types of antennas with this kind of flexibility could transform smartphones, navigation systems and Wi-Fi. "We could develop potentially better antennas for cell phones that can respond to changing conditions."

Other applications could include wearable items, such as watches or medical devices, or in the field of soft robotics. "Most robots that work in factories are made out of stiff materials and aren't good interfacing with humans," he says. "Taken to the extreme, imagine an octopus with large freedom of motion that could perform delicate tasks."

In medicine, "we could see embedded electronics in gloves that a doctor or lab technician might wear, such as feedback sensors or prosthetics, and the doctor wouldn't even know that they were there," he adds.

Dickey is conducting his research under an NSF Faculty Early Career Development (CAREER) award, which he received in 2010. The award supports junior faculty who exemplify the role of teacher-scholars through outstanding research, excellent education and the integration of education and research within the context of the mission of their organization.

"We're trying to understand what is happening at the surface of the metal," he says. "I look at this metal as being like a composite material. It's a metal that forms this oxide on its surface, and the combination is interesting to me."

He and his team are trying to characterize the mechanical properties of the liquid metal, and "how to harness them," he says. "Also, we've been doing some chemical characterization in order to understand what is actually on the surface, and how we can modify it. And we are trying to reconfigure the shape of the metal."

His team is studying the way the metal flows in response to pressure.

"In a sense, the metal behaves like ketchup," he says. "It only flows when the skin breaks, due to application of a critical pressure."

The team harnessed this property to print the metal into freestanding 3D shapes despite the metal being a liquid.

As part of the grant's educational component, the research will be integrated into a new course at NC State for both undergraduate and graduate engineering students. Also, the researchers developed an interactive module that discusses the work within the context of popular movies designed to attract middle school minority children to higher education and careers in science. Among other things, they participate in a summer camp for about 200 middle school youngsters, "where we talk about the research, liquid metal and different fluids."

In preparing for this presentation, in fact, Dickey spoke at length to Gene Warren Jr., who created the special effects for Terminator 2: Judgment Day, in which "the bad guy turns into liquid metal, and then reassembles," Dickey says. "He said that they used liquid metal to do it. We show the kids a clip from the movie and they really get a kick out of it."

-- Marlene Cimons, National Science Foundation
Investigators
Michael Dickey
John Lach
John Muth
Veena Misra
Thomas Jackson
Shekhar Bhansali
Related Institutions/Organizations
North Carolina State University
Related Programs
Engineering Research Centers

NSF VIDEO: LOS ANGELES & WATER IMPORTS

16 PUERTO RICO POLICE OFFICERS PLEAD GUILTY TO USING BADGES TO COMMIT CRIMES

FROM:   U.S. JUSTICE DEPARTMENT 

Monday, August 25, 2014

Sixteen Former Puerto Rico Police Officers Plead Guilty to Running Criminal Organization from the Police Department

Former Officers Convicted of Racketeering, Robbery, Extortion, and Firearms Charges

Sixteen former Puerto Rico police officers have pleaded guilty for their roles in a criminal organization run out of the police department.   The officers used their affiliation with law enforcement to commit robbery and extortion, to manipulate court records in exchange for bribes, and to sell illegal narcotics.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Rosa Emilia Rodríguez-Vélez of the District of Puerto Rico and Special Agent in Charge Carlos Cases of the FBI’s San Juan Division made the announcement.

“These 16 police officers were charged with fighting crime, protecting lives and property, and improving the quality of life in Puerto Rico,” said Assistant Attorney General Caldwell.   “Instead, they used their badges and guns to do the opposite, committing crimes, endangering lives, and stealing property under the veil of police authority.  This prosecution demonstrates the Justice Department’s commitment to holding all criminals accountable – including those who wear a badge.  We will use every tool at our disposal, including the RICO laws, to rid our communities of corruption.”

The following 13 defendants pleaded guilty to conspiracy to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act:  Osvaldo Vazquez-Ruiz, 38; Orlando Sierra-Pereira, 37; Danny Nieves-Rivera, 35; Roberto Ortiz-Cintron, 35; Yovanny Crespo-Candelaria, 34; Jose Sanchez-Santiago, 32; Miguel Perez-Rivera, 35; Nadab Arroyo-Rosa, 33; Jose Flores-Villalongo, 52; Luis Suarez-Sanchez, 36; Eduardo Montañez-Perez, 29; Carlos Laureano-Cruz, 40; and Carlos Candelario-Santiago, 47.   Three defendants, Ruben Casiano-Pietri, 36, Christian Valles-Collazo, 28, and Ricardo Rivera Rodriguez, 39, pleaded guilty to robbery and extortion charges.   Several of the defendants also pleaded guilty to firearms charges in connection with the use of their police-issued firearms in furtherance of their crimes.   At the time of their criminal conduct, Flores-Villalongo and Candelario-Santiago were sergeants with the Police of Puerto Rico (POPR), and the other defendants were police officers.  Sentencing hearings are scheduled for December 2014.

According to court documents, over the course of the conspiracy, the officers worked together to conduct traffic stops and enter the homes of suspected criminals to steal money, property and drugs for their own personal enrichment.   They planted evidence to make false arrests, and then extorted money from their victims in exchange for their release from custody.   Additionally, in exchange for bribe payments, the officers gave false testimony, manipulated court records and failed to appear in court when required so that criminal cases would be wrongfully dismissed.   The officers also sold and distributed wholesale quantities of narcotics.

As just a few examples of their criminal conduct, in April 2012, defendants Vazquez-Ruiz and Sierra-Pereira conducted a traffic stop in their capacity as police officers and stole approximately $22,000 they believed to be illegal drug proceeds.   Vazquez-Ruiz later attempted to extort approximately $8,000 from an individual believed to be a drug dealer’s accomplice in exchange for promising to release a prisoner.

Further, in November 2012, defendants Sierra-Pereira, Nieves-Rivera, Ortiz-Cintron and Valles-Collazo illegally entered an apartment and stole approximately $30,000, which they believed were illegal lottery proceeds.

The defendants frequently shared with one another the proceeds they illegally obtained, and used their power, authority and official positions as police officers to promote and protect their illegal activity.   Among other things, the defendants used POPR firearms, badges, patrol cars, tools, uniforms and other equipment to commit the crimes, and then concealed their illegal activity with fraudulently obtained court documents and falsified POPR paperwork that made it appear they were engaged in legitimate police work.

The case was investigated by the FBI’s San Juan Division, and prosecuted by Trial Attorneys Brian K. Kidd, Emily Rae Woods and Menaka Kalaskar of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Mariana E. Bauzá of the District of Puerto Rico.