SECRETARY CARTER CALLS FOR "FULL-COURT PRESS" TO ADDRESS NATIONAL SECURITY ISSUES

FROM:  U.S. DEFENSE DEPARTMENT

Right:  Defense Secretary Ash Carter provides remarks on the national security budget and the relationship between the Defense and State departments at the Global Chiefs of Mission conference at the U.S. State Department in Washington, D.C., March 26, 2015. DoD screen shot.  

Carter Calls for ‘Full-Court Press’ on Security Challenges
By Jim Garamone
DoD News, Defense Media Activity

WASHINGTON, March 26, 2015 – Defense Secretary Ash Carter called for a “full-court press” within government to tackle the pressing national security issues of the day.

Carter spoke today at the State Department’s Global Chiefs of Mission Conference. He is the first defense secretary to address the conference.
Carter called on Congress to put money into the effort. “We can’t just theorize and strategize,” he said. “We have to invest in the whole-of-government way.”

Sequestration Would Harm Defense, Partner Agencies

The secretary said he and other military leaders “have been vocal and specific about the damage that sequestration-level budgets would inflict on the need to restore readiness, on badly needed technological modernization, and on keeping faith with troops and their families.

“And I want to emphasize that current proposals to shoe-horn DoD’s base budget funds into our contingency accounts would fail to solve the problem, while also undermining basic principles of accountability and responsible long-term planning,” Carter said.

And, as the defense secretary, Carter said he cannot ignore cuts in partner agencies such as State, Homeland Security and Treasury.

“I cannot be indifferent to the vital national security responsibilities across our government, just as I cannot be indifferent to my own at DoD,” he said.

‘Whole-of-Government’ Approach

The secretary stressed that most of the national security issues facing America require resources from a number of different agencies working together.

Diplomatic, economic, information and military aspects must be fully integrated for U.S. policies to succeed, he said. Cuts in the State Department budget, for example, affect the Defense Department and vice versa, Carter added.

In recent years, many have been calling for “whole-of-government” approaches to world problems. They also talk about “smart power” -- meaning using more than just the military to effect change. These terms, Carter said, are relatively new, but the basic concept has “been around from Sung China to the Holy Roman Empire -- the idea of leveraging all resources of state is an enduring principle of strategy and statecraft.”

The United States used the whole-of-government approach in crafting and executing the Marshall Plan after World War II, Carter said. That plan, he added, laid the foundation for the Common Market and now the European Union.

Interagency Operations Vital

But harnessing the power of the government has not always been easy, Carter said. Since World War II, State and Defense have often been working at cross purposes, he said, but that has changed.

“We work with a generation of national-security professionals in both agencies, who are actually steeped in interagency cooperation,” the secretary said. “Most of today’s senior officials cut their teeth in the multidimensional policy challenges we faced in Haiti and the Balkans in the 1990s, and the wars in Iraq and Afghanistan and against terror brought even closer interagency cooperation.”

Carter noted that then-Defense Secretary Robert M. Gates testified before Congress in 2010 in support of the State Department’s budget request, and he has done the same.

“Senior Defense Department officials have become some of the most vocal constituents for greater civilian involvement not just in conflict zones but … also in what I have called ‘preventive defense,’ or the influencing of the strategic environment to prevent and deter conflict in the first place,” he said.

Military personnel also recognize that ensuring victory requires much more than guns and steel, the secretary said.

“In conflict zones, it requires good governance, reconciliation, education and the rule of law,” he said. “And in addressing the wider catalog of strategic challenges, it requires marrying the threat of force with financial and diplomatic leverage.”

Coalition ‘Putting ISIL on the Defensive’

Operations against the Islamic State of Iraq and the Levant are a case in point, Carter said. “Today, our global coalition's military campaign is putting ISIL on the defensive,” he said. “Just yesterday [in Iraq] the coalition that many of you in this room have built began conducting airstrikes around Tikrit. But we know that lasting defeat of ISIL requires an integrated campaign with equally potent political and economic maneuvers.”

A lasting defeat of ISIL, he said, requires DoD to work closely with the State Department to support the government of Iraq and the nascent Syrian opposition, and to assemble and then fully leverage the commitment and resources of a vast coalition. It also requires the U.S. Agency for International Development to work closely with regional and global partners, as refugees continue flowing into Jordan and Turkey, he added.

Defeating ISIL requires the U.S. Treasury to choke off the terror group’s resources, “while Homeland Security, the intelligence community and law enforcement together keep watch on our borders” and deter attacks on the United States and its friends and allies, Carter said.

Unified Approach Needed for Diverse Challenges

The same whole-of-government effort is needed against Iran’s nuclear program, he said, and against Russia’s illegal annexation of Crimea from Ukraine and continued operations inside Eastern Ukraine.

A full-court press also is needed in the aftermath of disasters, he said. “We’ve worked across our government, demonstrating that in an hour of need, the United States shows up for our closest allies and friends,” Carter said.

The secretary pointed to the U.S. response to the earthquake, tsunami and nuclear reactor accident in Japan as an example. “This effort powerfully reinforced the U.S.-Japan alliance, demonstrating to Japanese citizens just how deep and broad that alliance really is,” he said.

Securing cyberspace requires the efforts of many U.S. agencies and international partners, Carter said. DoD is working with the National Institutes of Standards and Technology, the Department of Commerce and the Department of Homeland Security on protecting this new domain. The State Department is leading an effort to build international agreements on norms of state conduct in cyber space, he said.

“To pack the fullest strategic punch, we need to do a better job developing joint strategies and pooling our resources to execute them,” Carter said to the State Department audience. “We need to adequately fund and empower your mission as our nation's top envoys.”

Those in national security, the secretary said, need to “think big and anew, even re-imagining the future of our national security machinery to address classic strategic challenges, such as those in Asia, alongside campaigns that we’re conducting in the Middle East, while also tackling transnational challenges like global health security and the proliferation of weapons of mass destruction.”
The full-court press needs to be applied not only to challenges, but to opportunities as well, he said.

“We need to put a whole-of-government muscle not only behind our challenges, but also behind our beckoning opportunities, from strengthening and modernizing our longstanding alliances to advancing our shared prosperity through new trade agreements with Europe and Asia, to building new partnerships with rising powers like India,” Carter said.

HHS ANNOUNCES RECORD $19.5 BILLION RECOVERED FROM HEALTH CARE FRAUD CASES

FROM:  DEPARTMENT OF HEALTH AND HUMAN SERVICES 
February 26, 2014

Departments of Justice and Health and Human Services announce record-breaking recoveries resulting from joint efforts to combat health care fraud
Government teams recovered $4.3 billion in FY 2013 and $19.2 billion over the last five years

Attorney General Eric Holder and HHS Secretary Kathleen Sebelius today released the annual Health Care Fraud and Abuse Control (HCFAC) Program report showing that for every dollar spent on health care-related fraud and abuse investigations through this and other programs in the last three years, the government recovered $8.10.  This is the highest three-year average return on investment in the 17-year history of the HCFAC Program.

The government’s health care fraud prevention and enforcement efforts recovered a record-breaking $4.3 billion in taxpayer dollars in Fiscal Year (FY) 2013, up from $4.2 billion in FY 2012, from individuals and companies who attempted to defraud federal health programs serving seniors or who sought payments from taxpayers to which they were not entitled.  Over the last five years, the administration’s enforcement efforts have recovered $19.2 billion, up from $9.4 billion over the prior five-year period.  Since the inception of the program in1997, the HCFAC Program has returned more than $25.9 billion to the Medicare Trust Funds and treasury.

These recoveries, released today in the annual HCFAC Program report, demonstrate President Obama’s commitment to making the elimination of fraud, waste and abuse, particularly in health care, a top priority for the administration.  This is the fifth consecutive year that the program has increased recoveries over the past year, climbing from $2 billion in FY 2008 to over $4 billion every year since FY 2011.

The success of this joint Department of Justice and HHS effort was made possible in part by the Health Care Fraud Prevention and Enforcement Action Team (HEAT), created in 2009 to prevent fraud, waste and abuse in Medicare and Medicaid and to crack down on individuals and entities that are abusing the system and costing American taxpayers billions of dollars.

“With these extraordinary recoveries, and the record-high rate of return on investment we’ve achieved on our comprehensive health care fraud enforcement efforts, we’re sending a strong message to those who would take advantage of their fellow citizens, target vulnerable populations, and commit fraud on federal health care programs,” said Attorney General Eric Holder.  “Thanks to initiatives like HEAT, our work to combat fraud has never been more cooperative or more effective.  And our unprecedented commitment to holding criminals accountable, and securing remarkable results for American taxpayers, is paying dividends.”

“These impressive recoveries for the American taxpayer are just one aspect of the comprehensive anti-fraud strategy we have implemented since the passage of the Affordable Care Act,” said HHS Secretary Sebelius.  “We’ve cracked down on tens of thousands health care providers suspected of Medicare fraud. New enrollment screening techniques are proving effective in preventing high risk providers from getting into the system, and the new computer analytics system that detects and stops fraudulent billing before money ever goes out the door is accomplishing positive results – all of which are adding to savings for the Medicare Trust Fund.”

The new authorities under the Affordable Care Act granted to HHS and the Centers for Medicare & Medicaid Services (CMS) were instrumental in clamping down on fraudulent activity in health care.  In FY 2013, CMS announced the first use of its temporary moratoria authority granted by the Affordable Care Act.  The action stopped enrollment of new home health or ambulance enrollments in three fraud hot spots around the country, allowing CMS and its law enforcement partners to remove bad actors from the program while blocking provider entry or re-entry into these already over-supplied markets.

The Justice Department and HHS have improved their coordination through HEAT and are currently operating Medicare Fraud Strike Force teams in nine areas across the country. The strike force teams use advanced data analysis techniques to identify high-billing levels in health care fraud hot spots so that interagency teams can target emerging or migrating schemes as well as chronic fraud by criminals masquerading as health care providers or suppliers. The Justice Department’s enforcement of the civil False Claims Act and the Federal Food, Drug and Cosmetic Act has produced similar record-breaking results.  These combined efforts coordinated under HEAT have expanded local partnerships and helped educate Medicare beneficiaries about how to protect themselves against fraud.

In Fiscal Year 2013, the strike force secured records in the number of cases filed (137), individuals charged (345), guilty pleas secured (234) and jury trial convictions (46). Beyond these remarkable results, the defendants who were charged and sentenced are facing significant time in prison – an average of 52 months in prison for those sentenced in FY 2013, and an average of 47 months in prison for those sentenced since 2007.

In FY 2013, the Justice Department opened 1,013 new criminal health care fraud investigations involving 1,910 potential defendants, and a total of 718 defendants were convicted of health care fraud-related crimes during the year.  The department also opened 1,083 new civil health care fraud investigations.

The strike force coordinated a takedown in May 2013 that resulted in charges by eight strike force cities against 89 individuals, including doctors, nurses and other licensed medical professionals, for their alleged participation in Medicare fraud schemes involving approximately $223 million in false billings. As a part of the May 2013 takedown, HHS also suspended or took other administrative action against 18 providers using authority under the health care law to suspend payments until an investigation is complete.

In FY 2013, the strike force secured records in the number of cases filed (137), individuals charged (345), guilty pleas secured (234) and jury trial convictions (48). Beyond these remarkable results, the defendants who were charged and sentenced are facing significant time in prison – an average of 52 months in prison for those sentenced in FY 2013, and an average of 47 months in prison for those sentenced since 2007.

In March 2011, CMS began an ambitious project to revalidate all 1.5 million Medicare enrolled providers and suppliers under the Affordable Care Act screening requirements. As of September 2013, more than 535,000 providers were subject to the new screening requirements and over 225,000 lost the ability to bill Medicare due to the Affordable Care Act requirements and other proactive initiatives.  Since the Affordable Care Act, CMS has also revoked 14,663 providers and suppliers’ ability to bill the Medicare program. These providers were removed from the program because they had felony convictions, were not operational at the address CMS had on file, or were not in compliance with CMS rules.

HHS and the Justice Department are leading historic efforts with the private sector to bring innovation to the fight against health care fraud. In addition to real-time data and information exchanges with the private sector, CMS’ Program Integrity Command Center worked with the HHS Office of the Inspector General and the FBI to conduct 93 missions to detect, investigate, and reduce improper payments in FY 2013.

From May 2013 through August 2013, CMS led an outreach and education campaign targeted to specific communities where Medicare fraud is more prevalent.  This multimedia campaign included national television, radio, and print outreach and resulted in an increased awareness of how to detect and report Medicare fraud.

CHIEF OF SECURITY FOR DRUG TRAFFICKER TARGETED AS SPECIALLY DESIGNATED NARCOTICS TRAFFICKER

FROM:  U.S. TREASURY DEPARTMENT
Action Targets Cartel Enforcer and Security Firm Linked to the Beltran Leyva Organization


WASHINGTON – The U.S. Department of the Treasury today designated Arnoldo Villa Sanchez as a specially designated narcotics trafficker (SDNT) pursuant to the Foreign Narcotics Kingpin Designation Act (Kingpin Act).  Arnoldo Villa Sanchez, a.k.a. Erick Rene Calderon Sanchez, is the chief of security for Hector Beltran Leyva, the leader of the Beltran Leyva drug trafficking organization.  Villa Sanchez has carried out numerous acts of violence on behalf of his cartel bosses.  In addition to the action against Villa Sanchez, the Treasury Department also designated Sistemas Elite De Seguridad Privada, S.A. de C.V., a private security firm, for being owned and controlled by Arnoldo Villa Sanchez.  Treasury also designated Miguel Loza Hernandez for his links to Arnoldo Villa Sanchez and Sistemas Elite De Seguridad Privada, S.A. de C.V.  Today's action, pursuant to the Kingpin Act, generally prohibits U.S. persons from conducting financial or commercial transactions with these designees, and also freezes any assets they may have under U.S. jurisdiction.

"We have been closely monitoring the resurgence of the Beltran Leyva Organization as it battles for a larger share of the narcotics trade in Mexico.  We are determined to target all sides in this cartel war and will continue to use our authorities to disrupt these violent organizations,” said Treasury’s Director of the Office of Foreign Assets Control (OFAC) Adam J. Szubin.

Arnoldo Villa Sanchez is a top associate of Hector Beltran Leyva and serves as his security chief.  OFAC designated Hector Beltran Leyva as a SDNT in December 2009.  Arnoldo Villa Sanchez is the largest shareholder of Sistemas Elite De Seguridad Privada, S.A. de C.V., a Guadalajara, Mexico based security services firm with more than 150 employees.  Sistemas Elite De Seguridad Privada, S.A. de C.V. specializes in personnel protection and alarm services. Miguel Loza Hernandez manages, and is a shareholder of, Sistemas Elite De Seguridad Privada, S.A. de C.V.  Since 2008, Beltran Leyva Organization has waged a bloody war against rival organizations led by Joaquín "Chapo” Guzman Loera and the Sinaloa Cartel.  In the last two years, the Beltran Leyva Organization has re-established itself and begun to expand its influence in parts of Sinaloa.

The President identified the Beltran Leyva Organization and Marcos Arturo Beltran Leyva as significant foreign narcotics traffickers pursuant to the Kingpin Act in May 2008.  Hector Beltran Leyva has been indicted on drug trafficking charges by federal grand juries in the District of Columbia (2004) and the Eastern District of New York (2009).  The U.S. Department of State is offering up to a five million dollar reward for any information that leads to the capture of Hector Beltran Leyva.  In addition, Mexican authorities are offering up to 30,000,000 Mexican Pesos (two million dollars) for information leading to his arrest.  On January 20, 2008, Mexican authorities arrested Alfredo Beltran Leyva, the former leader of the Beltran Leyva Organization, on organized crime, drug trafficking, and unauthorized use of military grade weapons charges.  In December 2009, the Mexican military killed Marcus Arturo Beltran Leyva.  Subsequently, Hector Beltran Leyva assumed the role as leader of the Beltran Leyva organization.

Since June 2000, the President has identified 103 drug kingpins, and OFAC has designated more than 1,300 businesses and individuals, pursuant to the Kingpin Act. Penalties for violations of the Kingpin Act range from civil penalties of up to $1.075 million per violation, to more severe criminal penalties. Criminal penalties for corporate officers may include up to 30 years in prison and fines up to $5 million.  Criminal fines for corporations may reach $10 million.  Other individuals could face up to 10 years in prison and fines pursuant to Title 18 of the United States Code for criminal violations of the Kingpin Act.

U.S., SWITZERLAND ISSUE JOINT STATEMENT ON TAX EVASION

FROM:  U.S. JUSTICE DEPARTMENT 
Thursday, August 29, 2013
United States and Switzerland Issue Joint Statement Regarding Tax Evasion Investigations

Switzerland Encourages Its Banks to Cooperate with New Program Which Will Require Significant Financial Penalties and Information Sharing from Banks That Aided Secret Account Holders
The Department of Justice today announced a program that will encourage Swiss banks to cooperate in the department’s ongoing investigations of the use of foreign bank accounts to commit tax evasion.  The department also released a joint statement with the Swiss Federal Department of Finance, stating that Switzerland will encourage its banks to participate in the program.

“This program will significantly enhance the Justice Department's ongoing efforts to aggressively pursue those who attempt to evade the law by hiding their assets outside of the United States,” said Attorney General Eric Holder.  “In addition to strengthening our partnership with the Swiss government, the program’s requirement that Swiss banks provide detailed account information will improve our ability to bring tax dollars back to the U.S. treasury from across the globe.”

“This program will provide us with additional information to prosecute those who used secret offshore bank accounts and those here and abroad who established and facilitated the use of such accounts,” said Deputy Attorney General James M. Cole.  “Now is the time for all U.S. taxpayers who hid behind Swiss bank secrecy laws or have undeclared offshore accounts in other foreign countries to come forward and resolve their outstanding tax issues with the United States.”

Under the program, which is available only to banks that are not currently under criminal investigation by the department for their offshore activities, participating Swiss banks will be required to:

·          Agree to pay substantial penalties
·          Make a complete disclosure of their cross-border activities
·          Provide detailed information on an account-by-account basis for accounts in which U.S. taxpayers have a direct or indirect interest
·          Cooperate in treaty requests for account information
·          Provide detailed information as to other banks that transferred funds into secret accounts or that accepted funds when secret accounts were closed
·          Agree to close accounts of account holders who fail to come into compliance with U.S. reporting obligations

Banks meeting all of the above requirements will be eligible for non-prosecution agreements.  Banks currently under criminal investigation related to their Swiss banking activities, and all individuals, are expressly excluded from the program.

The program holds banks to a higher degree of responsibility for opening secret accounts after it became publicly known that the department was actively investigating offshore tax evasion in Switzerland.  Under the penalty provisions of the program, banks seeking a non-prosecution agreement must agree to a penalty in an amount equal to 20 percent of the maximum aggregate dollar value of all non-disclosed U.S. accounts that were held by the bank on Aug.1, 2008.  The penalty amount will increase to 30 percent for secret accounts that were opened after that date but before the end of February 2009 and to 50 percent for secret accounts opened later than that.  

The program will significantly assist the department’s efforts to investigate and prosecute U.S. taxpayers who, when faced with the risk of detection, chose to move funds away from banks under investigation to banks that they believed might be better havens for tax secrecy.  A key component of the program requires cooperating banks to provide information that will enable the United States to follow the money to other Swiss banks and to banks located in other countries.

The program also provides a path to resolution for Swiss banks that were not engaged in wrongful acts with U.S. taxpayers but nonetheless want a resolution of their status.  Most banks in this category will be asked to provide an internal investigation report prepared by an independent examiner, as well as any additional information requested by the department.  A smaller group of banks will be allowed to show that they met certain criteria for deemed-compliance under the Foreign Account Tax Compliance Act (FATCA).  Banks in these two groups will be eligible to receive non-target letters.

The program is intended to enable every Swiss bank that is not already under criminal investigation to find a path to resolution.  It also creates significant risks for individuals and banks that continue to fail to cooperate, including for those Swiss banks that facilitated U.S. tax evasion but fail to cooperate now, for all U.S. taxpayers who think that they can continue to hide income and assets in offshore banks, and for those advisors and others who facilitated these crimes.

Since 2009, the department has charged more than 30 banking professionals and 68 U.S. accountholders with violations arising from their offshore banking activities.  Fifty-four U.S. taxpayers and four bankers and financial advisors have pled guilty, and five taxpayers have been convicted at trial.  One Swiss bank entered into a deferred prosecution agreement, and a second Swiss bank was indicted and pleaded guilty.  Currently, the department is actively investigating the Swiss-based activities of 14 financial institutions.  The department’s enforcement activities are global and have also included public actions concerning activities in India, Luxembourg, Israel and the Caribbean.

The program does not address current or future investigations and pending cases concerning bank employees, financial advisors and other individuals.  The department will address each of these cases only with the individual’s counsel, in a manner that gives consideration to the particular facts and circumstances of each case.  In those cases in which indictments are pending, any resolution will also require addressing outstanding issues with the court.  Counsel for banks currently under investigation, individuals who have been indicted, or bank employees who are concerned about whether they have potential criminal liability should contact the department’s Tax Division or the prosecutors handling their case if they wish to seek resolution.  

The department notes that the joint statement with the Swiss Federal Department of Finance provides that if personal data are provided, they should only be used for purposes of law enforcement, which may include regulatory action, in the United States or as otherwise permitted by U.S. law.  Additionally, the department has assured its Swiss counterparts that it understands that simply because the names of individuals are included in the information that it receives from a bank does not necessarily mean that any particular individual is or is not culpable of wrongdoing.  The support that Switzerland has shown for this program may also help those banks already under investigation take some of the steps necessary to reach a resolution.

“Banks that come forward under the program that we have announced today have the opportunity to reach a resolution with the United States,” said Assistant Attorney General for the Tax Division Kathryn Keneally.  “The program will give us yet more information to pursue U.S. taxpayers who are continuing to hide their assets in offshore accounts, and creates significant risks for those Swiss banks that fail to come forward.  We recognize and express our appreciation for Switzerland’s support of the program.”

“The program the Department of Justice announced today is another positive step forward in the U.S. government’s continuing efforts to combat offshore tax evasion,” said Danny Werfel, Acting Commissioner of the Internal Revenue Service.  “On behalf of the IRS, I extend my appreciation to both the Justice Department and the Swiss government for developing a way forward that provides the United States with information that will be critical to the enforcement of our tax laws and will bring closure for Swiss banks that meet the requirements of the program.”