FROM: U.S. DEPARTMENT OF JUSTICE
Wednesday, August 15, 2012
New Zealand Fishing Company Found Guilty in Washington, D.C., of Environmental Crimes and Obstruction of Justice
Chief Engineer Also Found Guilty of Charges
WASHINGTON –A federal jury in Washington, D.C., today returned guilty verdicts against Sanford Ltd., a New Zealand fishing company, on six counts of conspiracy, obstruction of justice, and violating the Act to Prevent Pollution from Ships (APPS). The jury also found a company employee guilty of two other charges.
The verdicts, following a two-week trial in the U.S. District Court for the District of Columbia, were announced by Assistant Attorney General Ignacia S. Moreno of the Department of Justice’s Environment and Natural Resources Division and U.S. Attorney for the District of Columbia Ronald C. Machen Jr.
Judge Beryl A. Howell scheduled sentencing for Nov. 16, 2012. Sanford faces a maximum fine of up to $500,000 on each count, for a total potential penalty of $3.0 million. Sanford’s primary chief engineer, James Pogue, 52, faces up to up to 20 years for obstruction of justice and six years for knowingly failing to maintain an accurate oil record book.
Acc
ording to the government’s evidence, in July 2011, the U.S. Coast Guard conducted a Port State Control examination on the Fishing Vessel (F/V) San Nikunau, when the vessel entered port in Pago Pago, American Samoa. The examination revealed that the vessel had been making false entries and omissions in its oil record book that vessels are required to maintain accurately in order to account for their handling of oil waste generated by the vessel.
According to evidence presented at trial, Sanford operates the San Nikunau a vessel that routinely delivers tuna to a cannery in Pago Pago. Over the past five years, Sanford was paid over $24 million for tuna deliveries. Sanford was convicted of numerous charges, including conspiracy and causing the vessel to enter to the port of Pago Pago with a falsified oil record book that failed to accurately account for how the vessel was managing its bilge waste and for obstruction of justice for falsely stating in the oil record book that required pollution prevention equipment had been used when it had not. Sanford was also convicted of discharging machinery space bilge waste into the port of Pago Pago without using required pollution prevention equipment including the oil water separator.
Pogue, of Idaho, served as the chief engineer on the vessel between 2001 and 2010. Pogue was convicted of failing to maintain an oil record book for the vessel that accurately accounted for how the vessel was managing its bilge waste. In addition, Pogue was convicted of obstruction of justice for falsely stating in the oil record book that required pollution prevention equipment had been used when it had not.
Prior to the trial, Rolando Ong Vano, 51, of the Philippines, another chief engineer who worked on the vessel, pleaded guilty to charges in the case. He is to be sentenced Sept. 7, 2012.
"These verdicts hold a company and one of its chief engineers accountable for polluting the waters off American Samoa with oily waste, and then trying to cover up their acts," said U.S. Attorney Machen. "The prosecution demonstrates our commitment to enforcing environmental laws and protecting our precious natural resources."
This case was investigated by the U.S. Coast Guard and the Coast Guard Investigative Service. The case was prosecuted by Trial Attorney Kenneth E. Nelson of the Environmental Crimes Section of the Department of Justice and Assistant U.S. Attorney Frederick W. Yette of the U.S. Attorney's Office for the District of Columbia.
Saturday, August 18, 2012
OFF-WORLD MILITARY SUPPORT
FROM: U.S. AIR FORCE SPACE COMMAND110927-N-PO203-165 KODIAK, Alaska (Sept. 27, 2011) The Office of Naval Research-sponsored tactical satellite IV (TacSat-4) lifts-off from the Alaskan Aerospace Corporation's Kodiak Launch Complex aboard a Minotaur IV+ launch vehicle. Built by the Naval Research Laboratory and Johns Hopkins University Applied Physics Laboratory, TacSat-4 will allow troops using existing radios to communicate on-the-move and from obscure regions. (U.S. Navy photo by John F. Williams/Released)
Supporting warfighters from space
Posted 8/17/2012
by Capt. Chris Sukach
Air Force Space Command Public Affairs
8/17/2012 - HUNTSVILLE, Ala. -- Air Force Space Command Vice Commander Lt. Gen. John Hyten spoke at the 15th Annual Space and Missile Defense Conference here Aug. 14 and discussed how the American way of war has fundamentally changed thanks to space.
He used historical examples to illustrate his point and contrasted those with support provided in more recent conflicts like operations Iraqi Freedom and Enduring Freedom.
Hyten highlighted the importance of knowledge and communication in warfare, emphasizing how critical it is for warfighters of today to know the lay of the land.
"It's really simple," the general said addressing the audience of space professionals. "My job, and the job of most people in this room, is to ensure no American warfighter, no American Soldier, Sailor, Airman or Marine ever has to worry again about what's over that hill or what's around the next corner. No American in combat should ever again lack the ability to communicate."
The situational awareness space assets provide has grown vastly since 1991 and Operation Desert Storm, which is largely regarded as America's first space war, the general said. He explained GPS was not integrated into systems like it is today and that troops supplemented the few military grade receivers they had with commercial ones duct taped to their vehicles.
Today you'd be hard pressed to find a tactical unit that doesn't use real-time global positioning, navigation and timing capabilities, but the contributions of GPS go beyond just military application, he continued.
"It touches almost everything we do--pay-at-the-pump gas--you probably use GPS a dozen times a day and don't even know it," Hyten said of the integration of GPS into daily civilian life.
He also shared while the Defense Satellite Communications System satellites provided the backbone of the command, control and computer network during Desert Storm, the data provided by the system was small by today's standards.
"One WGS [Wideband Global SATCOM] satellite has more bandwidth than the entire SATCOM constellation in the first Gulf War," said the general, contrasting the technologies.
Because satellites orbit the world, the capabilities space assets provide play an integral part in meeting the needs of today's warfighters wherever they may be, he explained.
"Our joint warfighers depend on space--they depend on the asymmetrical advantage it creates--and there is no going back," Hyten said.
VA SAYS PATIENT CARE ENHANCED THROUGH EXPANDING PRESCRIPTION SERVICES
August 17, 2012
WASHINGTON – Nearly 250,000 patients served by the Indian Health Service (IHS) have utilized a prescription service available through an interagency agreement between IHS and the U.S. Department of Veterans Affairs.
"Federal partners such as IHS are invaluable in VA’s commitment to collaborating and expanding award-winning services that enhance patient care," said Secretary of Veterans Affairs Eric K. Shinseki. "This agreement reflects VA’s pledge to be an effective steward of Federal resources and ensure that countless Veterans and patients of IHS receive the best health care possible."
The agreement allows IHS pharmacies to use the VA Consolidated Mail Outpatient Pharmacy (CMOP) to process and mail prescription refills for IHS patients. By accessing the service, IHS patients can now have their prescriptions mailed to them, in many cases eliminating the need to pick them up at an IHS pharmacy.
"The use of VA’s CMOP saves IHS patients travel time and wait time at the pharmacy, and allows IHS pharmacists to focus more attention on patient care," said Kenneth Siehr, Director of the VA CMOP program.
The service provides an alternative method for patients to obtain medication refills when transportation or work schedules make visiting a pharmacy difficult. Due to the agreement, pharmacists have been able to spend more time in clinics interacting with patients and answering questions.
"As a result of our partnership with VA and our use of CMOP, we’ve seen advances in our patient care and satisfaction," said Randy Grinnell, Deputy Director for IHS.
VA has successfully utilized CMOP since 1994 and currently processes over 111 million prescriptions annually. In 2011, the program earned distinction as a Customer Service Champion from JD Power and Associates.
Eleven IHS sites currently use VA CMOP: Haskell, Kan.; Phoenix; Rapid City, S.D.; Yakima, Wash.; and Claremore, Clinton, El Reno, Lawton, Pawhuska, Pawnee and Watonga in Oklahoma.
VA operates the largest integrated health care system in the country. With a health care budget of more than $50 billion, VA expects to provide care to 6.1 million patients supporting 920,000 hospitalizations and nearly 80 million outpatient visits this year. VA’s health care network includes 152 major medical centers and more than 800 community-based outpatient clinics.
SEC CHARGES OWNER OF WEBSITE ZEEKREWARDS.COM WITH RUNNING A $600 MILLION PONZI SCHEME
THE SECURITIES AND EXCHANGE COMMISSIONWashington, D.C., Aug. 17, 2012 – The Securities and Exchange Commission today announced fraud charges and an emergency asset freeze to halt a $600 million Ponzi scheme on the verge of collapse. The emergency action assures that victims can recoup more of their money and potentially avoid devastating losses.
The SEC alleges that online marketer Paul Burks of Lexington, N.C. and his company Rex Venture Group have raised money from more than one million Internet customers nationwide and overseas through the website ZeekRewards.com, which they began in January 2011.
According to the SEC’s complaint filed in federal court in Charlotte, N.C., customers were offered several ways to earn money through the ZeekRewards program, two of which involved purchasing securities in the form of investment contracts. These securities offerings were not registered with the SEC as required under the federal securities laws.
The SEC alleges that investors were collectively promised up to 50 percent of the company’s daily net profits through a profit sharing system in which they accumulate rewards points that they can use for cash payouts. However, the website fraudulently conveyed the false impression that the company was extremely profitable when, in fact, the payouts to investors bore no relation to the company’s net profits. Most of ZeekRewards’ total revenues and the "net profits" paid to investors have been comprised of funds received from new investors in classic Ponzi scheme fashion.
"The obligations to investors drastically exceed the company’s cash on hand, which is why we need to step in quickly, salvage whatever funds remain and ensure an orderly and fair payout to investors," said Stephen Cohen, an Associate Director in the SEC’s Division of Enforcement. "ZeekRewards misused the power of the Internet and lured investors by making them believe they were getting an opportunity to cash in on the next big thing. In reality, their cash was just going to the earlier investor."
The SEC’s complaint alleges that the scheme is teetering on collapse with investor funds at risk of dissipation without its emergency enforcement action. Last month, ZeekRewards brought in approximately $162 million while total investor cash payouts were approximately $160 million. If customers continue to increasingly elect to receive cash payouts rather than reinvesting their money to reach higher levels of rewards points, ZeekRewards’ cash outflows would eventually exceed its total revenue.
Burks has agreed to settle the SEC’s charges against him without admitting or denying the allegations, and agreed to cooperate with a court-appointed receiver.
According to the SEC’s complaint, ZeekRewards has paid out nearly $375 million to investors to date and holds approximately $225 million in investor funds in 15 foreign and domestic financial institutions. Those funds will be frozen under the emergency asset freeze granted by the court at the SEC’s request. Meanwhile, Burks has personally siphoned several million dollars of investors’ funds while operating Rex Venture and ZeekRewards, and he distributed at least $1 million to family members. Burks has agreed to relinquish his interest in the company and its assets plus pay a $4 million penalty. Additionally, the court has appointed a receiver to collect, marshal, manage and distribute remaining assets for return to harmed investors.
The SEC’s investigation was conducted by Brian M. Privor and Alfred C. Tierney in the SEC’s Enforcement Division in Washington D.C. The SEC acknowledges the assistance of the Quebec Autorite des Marches Financiers and the Ontario Securities Commission.
U.S. STATE DEPARTMENT PRESS RELEASES: WEST BANK ATTACK, SUDAN'S RELEASE OF PROTESTORS, INTERNATIONAL NARCOTICS AGREEMENT
FROM: U.S. STATE DEPARTMENT
Firebomb Attack in West Bank
Press Statement
Victoria Nuland
Department Spokesperson, Office of the Spokesperson
Washington, DC
August 17, 2012
The United States condemns in the strongest possible terms yesterday’s attack on a Palestinian taxi in the West Bank. We extend our deepest sympathies to the victims, among them children, and we hope for their speedy recovery. We note that the Government of Israel has also condemned this heinous attack and pledged to bring the perpetrators to justice. We look to Israeli law enforcement officials to do so expeditiously. We urge all parties to avoid any actions that could lead to an escalation of violence.
Government of Sudan's Release of Detained ProtestersPress Statement
Victoria Nuland
Department Spokesperson, Office of the Spokesperson
Washington, DC
August 17, 2012
On August 15, the Government of Sudan’s National Intelligence and Security Service announced that it will release from custody all persons detained by it during political protests in June and July. The United States welcomes this announcement, and calls upon the Government of Sudan to respect its citizens’ rights, including freedom of expression and peaceful assembly. We hope that this can be the first step in a necessary process of dialogue and reconciliation between the Government of Sudan and advocates for peaceful, democratic reform.
In particular, we welcome the release of U.S. legal permanent resident Rudwan Dawod, whose case attracted significant attention across America. Earlier this week, we expressed our concern about Mr. Dawod’s case when he was detained after being released by a judge who had found him "not guilty" of the most serious charges leveled against him. We appreciate that the Government of Sudan complied with the decision by its court to release him.
The Bureau of International Narcotics and Law Enforcement Signs Cooperative Agreements with Several U.S. State Corrections Departments
Media Note
Office of the Spokesperson
Washington, DC
August 16, 2012
The Bureau of International Narcotics and Law Enforcement (INL) is entering into cooperative agreements with the Maryland Department of Public Safety and Correctional Services, California Department of Corrections and Rehabilitation, Nebraska Department of Correctional Services, New Mexico Corrections Department, Rhode Island Department of Corrections, and Wisconsin Department of Corrections. Under these cooperative agreements, the agencies will work in close collaboration with the INL team of corrections subject matter experts and country program officers to develop and deliver training and technical assistance high-quality, effective training, and technical assistance to foreign partners in the United States and overseas in corrections systems and operations. The cooperative agreements will work towards establishing relationships with partner nations that will facilitate future interactions with the same or new partner nations and capture information that can be used to evaluate and improve training and technical assistance programs.
These cooperative agreements will establish the mechanisms by which INL will be able to solicit and award cooperative agreements for specific projects under these partnerships.
Firebomb Attack in West Bank
Press Statement
Victoria Nuland
Department Spokesperson, Office of the Spokesperson
Washington, DC
August 17, 2012
The United States condemns in the strongest possible terms yesterday’s attack on a Palestinian taxi in the West Bank. We extend our deepest sympathies to the victims, among them children, and we hope for their speedy recovery. We note that the Government of Israel has also condemned this heinous attack and pledged to bring the perpetrators to justice. We look to Israeli law enforcement officials to do so expeditiously. We urge all parties to avoid any actions that could lead to an escalation of violence.
Government of Sudan's Release of Detained ProtestersPress Statement
Victoria Nuland
Department Spokesperson, Office of the Spokesperson
Washington, DC
August 17, 2012
On August 15, the Government of Sudan’s National Intelligence and Security Service announced that it will release from custody all persons detained by it during political protests in June and July. The United States welcomes this announcement, and calls upon the Government of Sudan to respect its citizens’ rights, including freedom of expression and peaceful assembly. We hope that this can be the first step in a necessary process of dialogue and reconciliation between the Government of Sudan and advocates for peaceful, democratic reform.
In particular, we welcome the release of U.S. legal permanent resident Rudwan Dawod, whose case attracted significant attention across America. Earlier this week, we expressed our concern about Mr. Dawod’s case when he was detained after being released by a judge who had found him "not guilty" of the most serious charges leveled against him. We appreciate that the Government of Sudan complied with the decision by its court to release him.
The Bureau of International Narcotics and Law Enforcement Signs Cooperative Agreements with Several U.S. State Corrections Departments
Media Note
Office of the Spokesperson
Washington, DC
August 16, 2012
The Bureau of International Narcotics and Law Enforcement (INL) is entering into cooperative agreements with the Maryland Department of Public Safety and Correctional Services, California Department of Corrections and Rehabilitation, Nebraska Department of Correctional Services, New Mexico Corrections Department, Rhode Island Department of Corrections, and Wisconsin Department of Corrections. Under these cooperative agreements, the agencies will work in close collaboration with the INL team of corrections subject matter experts and country program officers to develop and deliver training and technical assistance high-quality, effective training, and technical assistance to foreign partners in the United States and overseas in corrections systems and operations. The cooperative agreements will work towards establishing relationships with partner nations that will facilitate future interactions with the same or new partner nations and capture information that can be used to evaluate and improve training and technical assistance programs.
These cooperative agreements will establish the mechanisms by which INL will be able to solicit and award cooperative agreements for specific projects under these partnerships.
Friday, August 17, 2012
ISAF NEWS FROM AFGHANISTAN AUGUST 17, 2012
FROM: U.S. DEPARTMENT OF DEFENSE
120813-N-JY402-005 FORT JACKSON, S.C. (Aug.13,2012) Active Duty and Reserve Sailors conduct combat gear assembly of the new improved outer tactical vest on Day 2 at the Navy Individual Augmentee Combat Training (NIACT) school in Fort Jackson, SC. Upon completion of the school, the Sailors will staff the Role III Trauma Hospital in Kandahar, Afghanistan. (U.S. Navy photo by Lt. Cmdr. Randal Jones/Released)
Combined Forces Arrests Taliban Leader, Seizes Weapons, Drugs
From an International Security Assistance Force Joint Command News Release
KABUL, Afghanistan, Aug. 17, 2012 - An Afghan and coalition security force arrested a Taliban leader in the Alisheng district of Laghman province today, military officials reported.
The Taliban leader supplied heavy weapons and explosives to insurgents in the area and directed insurgent attacks against Afghan and coalition forces. In the weeks leading up to his arrest, officials said, the Taliban leader was involved in planning attacks against local Afghan citizens.
The security force also detained two suspected insurgents and seized several weapons and approximately 6 pounds of opium.
In other news today:
-- In the Chahar Bolak district of Balkh province, a combined force arrested several suspected insurgents during an operation to detain a Taliban leader. The leader finances and provides weapons to Taliban fighters in Chimtal district.
-- In the Nahr-e Saraj district of Helmand province, a combined force detained a suspected insurgent during an operation to arrest a Taliban leader. The leader plans and directs improvised explosive device attacks and provides suicide vests for use in attacks on Afghan and coalition forces.
AUTO PRICE FIXER PLEADS GUILTY
Thursday, August 16, 2012
Yazaki Executive Agrees to Plead Guilty to Price Fixing on Automobile Parts Installed in U.S. Cars
Executive Agrees to Serve 14 Months in a U.S. Prison
WASHINGTON – An executive of Tokyo-based Yazaki Corporation has agreed to plead guilty for his role in a conspiracy to fix prices of instrument panel clusters, also known as meters, installed in cars sold in the United States and elsewhere, the Department of Justice announced today. He is the 11th executive to be charged in the government’s ongoing investigation into price fixing and bid rigging in the auto parts industry.
In a one-count felony charge filed today in the U.S. District Court for the Eastern District of Michigan in Detroit, Toshio Sudo, a Japanese national, was charged with engaging in a conspiracy to rig bids for, and to fix, stabilize and maintain the prices of instrument panel clusters sold to customers in the United States and elsewhere. According to the charge, Sudo’s involvement in the conspiracy lasted from at least as early as January 2003 until at least February 2009. The department said that Sudo and his co-conspirators carried out the conspiracy by agreeing, during meetings and conversations, to allocate the supply of instrument panel clusters and sold the parts at noncompetitive prices to automakers in the United States and elsewhere.
According to the plea agreement, which is subject to court approval, Sudo has agreed to serve 14 months in a U.S. prison, to pay a $20,000 criminal fine and to cooperate with the department’s investigation.
Yazaki manufactures and sells a variety of automotive parts, including instrument panel clusters. Instrument panel clusters are the mounted array of instruments and gauges housed in front of the driver of an automobile. According to the charge, Sudo and his co-conspirators carried out the conspiracy by, among other things, agreeing during meetings and discussions to coordinate bids submitted to, and price adjustments requested by, automobile manufacturers.
"From using code names with one another, to meeting in remote or private locations, the conspirators employed a variety of measures to keep their illegal conduct secret," said Scott D. Hammond, Deputy Assistant Attorney General of the Antitrust Division’s criminal enforcement program. "The division and its law enforcement partners will continue to do everything in our power to detect these cartels and bring them to justice."
"The conspiracies to fix prices and rig bids in the automotive industry represent a serious crime against the United States. Car makers and car buyers pay the price for these illegal activities," said Robert D. Foley III, Special Agent in Charge of the FBI’s Detroit Field Office. "The FBI is committed to vigorously pursuing and stopping those who commit these crimes.
Including Sudo, seven companies and 11 executives have been charged in the department’s ongoing investigation into price fixing and bid rigging in the auto parts industry. Furukawa Electric Co. Ltd, DENSO Corp., Yazaki Corp., G.S. Electech Inc., Fujikura Ltd. and Autoliv Inc. pleaded guilty and were sentenced to pay a total of more than $785 million in criminal fines. TRW Deutschland Holding GmbH has agreed to plead guilty. Additionally, seven of the individuals – Junichi Funo, Hirotsugu Nagata, Tetsuya Ukai, Tsuneaki Hanamura, Ryoki Kawai, Shigeru Ogawa and Hisamitsu Takada – have been sentenced to pay criminal fines and to serve jail sentences ranging from a year and a day to two years each. Makoto Hattori and Norihiro Imai have pleaded guilty and await sentencing. Kazuhiko Kashimoto is scheduled to plead guilty on Sept. 26, 2012.
Sudo is charged with price fixing in violation of the Sherman Act, which carries a maximum sentence for individuals of 10 years and a fine of $1 million. The maximum fine for an individual may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
UNEMPLOYMENT INSURANCE WEEKLY CLAIMS REPORT FOR WEEK EENDING AUGUST 11, 2012
UNEMPLOYMENT INSURANCE WEEKLY CLAIMS REPORT
SEASONALLY ADJUSTED DATA
In the week ending August 11, the advance figure for seasonally adjusted initial claims was 366,000, an increase of 2,000 from the previous week's revised figure of 364,000. The 4-week moving average was 363,750, a decrease of 5,500 from the previous week's revised average of 369,250.
The advance seasonally adjusted insured unemployment rate was 2.6 percent for the week ending August 4, unchanged from the prior week's unrevised rate.
The advance number for seasonally adjusted insured unemployment during the week ending August 4, was 3,305,000, a decrease of 31,000 from the preceding week's revised level of 3,336,000. The 4-week moving average was 3,303,000, a decrease of 3,000 from the preceding week's revised average of 3,306,000.
The advance number of actual initial claims under state programs, unadjusted, totaled 315,776 in the week ending August 11, a decrease of 4,443 from the previous week. There were 346,014 initial claims in the comparable week in 2011.
The advance unadjusted insured unemployment rate was 2.5 percent during the week ending August 4, unchanged from the prior week's unrevised rate. The advance unadjusted number for persons claiming UI benefits in state programs totaled 3,172,998, a decrease of 69,887 from the preceding week. A year earlier, the rate was 2.8 percent and the volume was 3,553,649.
The total number of people claiming benefits in all programs for the week ending July 28 was 5,680,545, a decrease of 69,782 from the previous week.
Extended benefits were only available in Idaho during the week ending July 28,
Initial claims for UI benefits by former Federal civilian employees totaled 1,246 in the week ending August 4, a decrease of -221 from the prior week. There were 2,538 initial claims by newly discharged veterans, an increase of 121 from the preceding week.
There were 18,115 former Federal civilian employees claiming UI benefits for the week ending July 28, an increase of 655 from the previous week. Newly discharged veterans claiming benefits totaled 40,099, an increase of 925 from the prior week.
States reported 2,350,202 persons claiming EUC (Emergency Unemployment Compensation) benefits for the week ending July 28, a decrease of 62,736 from the prior week. There were 3,130,608 persons claiming EUC in the comparable week in 2011. EUC weekly claims include first, second, third, and fourth tier activity.
The highest insured unemployment rates in the week ending July 28 were in theVirgin Islands (4.5), Puerto Rico (4.0), Pennsylvania (3.9), New Jersey (3.8), Connecticut (3.6), Alaska (3.5), California (3.5), Rhode Island (3.3), New York (3.2), and Nevada (3.1).
The largest increases in initial claims for the week ending August 4 were in California (+3,069), Pennsylvania (+2,534), Illinois (+1,165), Ohio (+1,018), and Missouri (+935), while the largest decreases were in Michigan (-4,157), New York (-2,653), Puerto Rico (-1,394), Tennessee (-318), and Florida (-300).
REAL ESTATE FORCLOSURE SALE BID RIGGING FROWNED ON BY JUSTICE AS ONE CALIFORNIA WOMAN FOUND OUT
FROM: U.S. DEPARTMENT OF JUSTICE ANTITRUST DIVISION
WASHINGTON — A Northern California real estate investor has agreed to plead guilty for her role in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in Northern California, the Department of Justice announced. Felony charges were filed today in the U.S. District Court for the Northern District of California in Oakland against Danli Liu of Fremont, Calif.
To date, as a result of the department’s ongoing antitrust investigation into bid rigging and fraud at public real estate foreclosure auctions in Northern California, 25 individuals, including Liu, have agreed to plead or have pleaded guilty.
According to court documents, Liu conspired with others not to bid against one another, but instead to designate a winning bidder to obtain selected properties at public real estate foreclosure auctions in Alameda County, Calif. Liu was also charged with a conspiracy to use the mail to carry out a scheme to fraudulently acquire title to selected properties sold at public auctions, to make and receive payoffs, and to divert money to co-conspirators that would have gone to mortgage holders and others by holding second, private auctions open only to members of the conspiracy. The department said that the selected properties were then awarded to the conspirators who submitted the highest bids in the second, private auctions. The private auctions often took place at or near the courthouse steps where the public auctions were held.
The department said Liu conspired with others to rig bids and commit mail fraud at public real estate foreclosure auctions in Alameda County beginning as early as April 2009 and continuing until about March 2010.
"Liu and her fellow conspirators secretly conspired to purchase foreclosed real estate at suppressed prices, thereby restraining competition at these foreclosure auctions in Northern California," said Scott D. Hammond, Deputy Assistant Attorney General of the Antitrust Division’s criminal enforcement program. "The conspirators’ actions harmed lenders and distressed homeowners in an already struggling real estate market, and the division is committed to holding investors accountable for such behavior."
The department said that the primary purpose of the conspiracies was to suppress and restrain competition and to conceal payoffs in order to obtain selected real estate offered at Alameda County public foreclosure auctions at non-competitive prices. When real estate properties are sold at these auctions, the proceeds are used to pay off the mortgage and other debt attached to the property, with remaining proceeds, if any, paid to the homeowner. According to court documents, these conspirators paid and received money that otherwise would have gone to pay off the mortgage and other holders of debt secured by the properties, and, in some cases, the defaulting homeowner.
"The FBI and the Antitrust Division will continue to bring to justice those who engage in fraudulent anticompetitive practices at foreclosure auctions," said Stephanie Douglas, FBI Special Agent in Charge of the San Francisco Field Office. "We will hold those individuals accountable for the damage they have done to their victims and the real estate market."
A violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine for the Sherman Act charges may be increased to twice the gain derived from the crime or twice the loss suffered by the victim if either amount is greater than $1 million. A count of conspiracy to commit mail fraud carries a maximum sentence of 30 years in prison and a $1 million fine. The government can also seek to forfeit the proceeds earned from participating in the conspiracy to commit mail fraud.
COLLECTED STATE DEPARTMENT RELEASES: PUSSY RIOT, RAJAB SENTENCE, PALESTINIAN AID
FROM: U.S. STATE DEPARTMENT
Sentencing of Pussy Riot Punk Band Members in Russia
Press Statement
Victoria Nuland
Department Spokesperson, Office of the Spokesperson
Washington, DC
August 17, 2012
The United States is concerned about both the verdict and the disproportionate sentences handed down by a Moscow court in the case against the members of the band Pussy Riot and the negative impact on freedom of expression in Russia.
We urge Russian authorities to review this case and ensure that the right to freedom of expression is upheld.
Sentencing of Nabeel Rajab
Press Statement
Victoria Nuland
Department Spokesperson, Office of the Spokesperson
Washington, DC
August 17, 2012
The Government of Bahrain has committed to respect freedom of expression and assembly and we look to it to fulfill these commitments. We are deeply concerned that a Bahraini court sentenced Nabeel Rajab to three years in prison on charges of leading "illegal gatherings." We expect that the verdict and sentence will be reconsidered in the appeals process without delay. We urge the government of Bahrain to consider all available options to resolve this case. We believe that all people have a fundamental right to participate in peaceful acts of protest. We have repeatedly urged the government of Bahrain to take steps to build confidence across Bahraini society, and to begin a meaningful dialogue with the political opposition and civil society. Excessive punishment for peaceful expression – in this case and others – will not contribute to those efforts and only serves to divide Bahraini society further.
U.S. Assistance to the Palestinians
Taken Question
Office of the Spokesperson
Washington, DC
Question: How much of the FY2012 support for Palestinians has been transferred and how much is still pending? Are there congressional holds? If so, what is the State Department’s view on these holds?
Answer: We are working with the Congress to ensure continued U.S. support for the Palestinians, including $200 million in direct budget support this fiscal year (2012). We note that the United States provided $200 million in direct budget support to the Palestinian Authority in fiscal year 2011.
Our view remains that our assistance to the Palestinian people is an essential part of the U.S. commitment to a negotiated two-state solution for Palestinians and Israelis, promoting a comprehensive peace in the Middle East. It is in the interest not only of the Palestinians, but of Israel and the U.S. as well, to ensure these efforts continue as they help to build a more democratic, stable and secure region.
Sentencing of Pussy Riot Punk Band Members in Russia
Press Statement
Victoria Nuland
Department Spokesperson, Office of the Spokesperson
Washington, DC
August 17, 2012
The United States is concerned about both the verdict and the disproportionate sentences handed down by a Moscow court in the case against the members of the band Pussy Riot and the negative impact on freedom of expression in Russia.
We urge Russian authorities to review this case and ensure that the right to freedom of expression is upheld.
Sentencing of Nabeel Rajab
Press Statement
Victoria Nuland
Department Spokesperson, Office of the Spokesperson
Washington, DC
August 17, 2012
The Government of Bahrain has committed to respect freedom of expression and assembly and we look to it to fulfill these commitments. We are deeply concerned that a Bahraini court sentenced Nabeel Rajab to three years in prison on charges of leading "illegal gatherings." We expect that the verdict and sentence will be reconsidered in the appeals process without delay. We urge the government of Bahrain to consider all available options to resolve this case. We believe that all people have a fundamental right to participate in peaceful acts of protest. We have repeatedly urged the government of Bahrain to take steps to build confidence across Bahraini society, and to begin a meaningful dialogue with the political opposition and civil society. Excessive punishment for peaceful expression – in this case and others – will not contribute to those efforts and only serves to divide Bahraini society further.
U.S. Assistance to the Palestinians
Taken Question
Office of the Spokesperson
Washington, DC
Question: How much of the FY2012 support for Palestinians has been transferred and how much is still pending? Are there congressional holds? If so, what is the State Department’s view on these holds?
Answer: We are working with the Congress to ensure continued U.S. support for the Palestinians, including $200 million in direct budget support this fiscal year (2012). We note that the United States provided $200 million in direct budget support to the Palestinian Authority in fiscal year 2011.
Our view remains that our assistance to the Palestinian people is an essential part of the U.S. commitment to a negotiated two-state solution for Palestinians and Israelis, promoting a comprehensive peace in the Middle East. It is in the interest not only of the Palestinians, but of Israel and the U.S. as well, to ensure these efforts continue as they help to build a more democratic, stable and secure region.
M83 GALAXY AND THE SUPERNOVA
FROM: NASA
Over fifty years ago, a supernova was discovered in M83, a spiral galaxy about 15 million light years from Earth. Astronomers have used NASA's Chandra X-ray Observatory to make the first detection of X-rays emitted by the debris from this explosion.
Named SN 1957D because it was the fourth supernova to be discovered in the year of 1957, it is one of only a few located outside of the Milky Way galaxy that is detectable, in both radio and optical wavelengths, decades after its explosion was observed. In 1981, astronomers saw the remnant of the exploded star in radio waves, and then in 1987 they detected the remnant at optical wavelengths, years after the light from the explosion itself became undetectable.
A relatively short observation -- about 14 hours long -- from NASA's Chandra X-ray Observatory in 2000 and 2001 did not detect any X-rays from the remnant of SN 1957D. However, a much longer observation obtained in 2010 and 2011, totaling nearly 8 and 1/2 days of Chandra time, did reveal the presence of X-ray emission. The X-ray brightness in 2000 and 2001 was about the same as or lower than in this deep image.
This new Chandra image of M83 is one of the deepest X-ray observations ever made of a spiral galaxy beyond our own. This full-field view of the spiral galaxy shows the low, medium, and high-energy X-rays observed by Chandra in red, green, and blue respectively. The location of SN 1957D, which is found on the inner edge of the spiral arm just above the galaxy's center, is outlined in the box.
The new X-ray data from the remnant of SN 1957D provide important information about the nature of this explosion that astronomers think happened when a massive star ran out of fuel and collapsed. The distribution of X-rays with energy suggests that SN 1957D contains a neutron star, a rapidly spinning, dense star formed when the core of pre-supernova star collapsed. This neutron star, or pulsar, may be producing a cocoon of charged particles moving at close to the speed of light known as a pulsar wind nebula.
If this interpretation is confirmed, the pulsar in SN 1957D is observed at an age of 55 years, one of the youngest pulsars ever seen. The remnant of SN 1979C in the galaxy M100 contains another candidate for the youngest pulsar, but astronomers are still unsure whether there is a black hole or a pulsar at the center of SN 1979C.
An image from the Hubble Space Telescope (in the box labeled "Optical Close-Up") shows that the debris of the explosion that created SN 1957D is located at the edge of a star cluster less than 10 million years old. Many of these stars are estimated to have masses about 17 times that of the Sun. This is just the right mass for a star's evolution to result in a core-collapse supernova as is thought to be the case in SN 1957D.
These results will appear in an upcoming issue of The Astrophysical Journal. The researchers involved with this study were Knox Long (Space Telescope Science Institute), William Blair (Johns Hopkins University), Leith Godfrey (Curtin University, Australia), Kip Kuntz (Johns Hopkins), Paul Plucinsky (Harvard-Smithsonian Center for Astrophysics), Roberto Soria (Curtin University), Christopher Stockdale (University of Oklahoma and the Australian Astronomical Observatory), Bradley Whitmore (Space Telescope Science Institute), and Frank Winkler (Middlebury College).
NASA's Marshall Space Flight Center in Huntsville, Ala., manages the Chandra program for NASA's Science Mission Directorate in Washington. The Smithsonian Astrophysical Observatory controls Chandra's science and flight operations from Cambridge, Mass.
Credits: X-ray: NASA/CXC/STScI/K.Long et al., Optical: NASA/STScI
LT. GEN. ANGELELLA SAYS FOCUS ON BILATERAL IN PACIFIC
FROM: U.S. DEPARTMENT OF DEFENSE
USFJ commander focuses on bilateral operations
by Airman 1st Class John D. Partlow
374th Airlift Wing Public Affairs
8/15/2012 - YOKOTA AIR BASE, Japan (AFNS) -- With the Department of Defense's rebalance of military forces to the Asia Pacific region, the focus on bilateral operations is more critical now than ever, said the new U.S. Forces Japan and 5th Air Force commander.
"We plan to increase our bilateral and multilateral cooperation throughout the Western Pacific," said Lt. Gen. Salvatore Angelella, who became the USFJ and 5th Air Force commander July 20.
Angelella noted there will be more opportunity for joint training, and that in the future for the rebalance to the Pacific, the U.S. will send more of its newest equipment and highly trained crews.
The current deployment of F-22 Raptors to Okinawa and the ongoing deployment of MV-22 Osprey aircraft are prime examples of this.
"I think you'll see more of that in the future and also more opportunities for interoperability with our Japanese partners," the commander said.
With the mission focus shift, several challenges may present themselves along the way -- one of them being the global economy, Angelella explained.
"Because the global economy is not doing well right now, we're going to have to rely on a lot of the other partners to maintain peace and stability in the region," he said. "There will be more bilateral operations and more multilateral cooperation in areas like humanitarian assistance and disaster relief."
Lessons learned from previous disaster relief efforts, like Operation Tomodachi in March 2011, will help build the continuity for the future, the general said.
"We are going to have to institutionalize what we learned during the Great East Japan Earthquake last year," he said. "There was some great work between the forces and the components of U.S. Forces Japan, and also some great work between U.S. Forces Japan and the Jieitai, the Japanese Self Defense Force.
"They did a great job taking the lead of the relief effort, and we teamed with them and other nations," Angelella said. "So what we want to do is institutionalize (those lessons learned) as we transform our staffs."
With this being his fifth assignment to Japan, Angelella relies on his previous experiences here to help shape and influence the way he leads in the future.
"It's really all about relationships," he said. "Throughout those years (stationed in Japan), I developed a lot of close relationships with civilians and the military in Japan at the highest levels, so I think we're going to be able to get right to work and continue our cooperation and strengthen our alliance even more."
RECENT U.S. NAVY PHOTOS
FROM U.S. NAVY
Capt. Jeffrey L. Trent, the outgoing commander of Carrier Air Wing (CVW) 1, inspects the rotor blades of an E-2C Hawkeye assigned to the Screwtops of Carrier Airborne Early Warning Squadron (VAW) 123 before his change of command flight aboard the aircraft carrier USS Enterprise (CVN 65). Enterprise is deployed to the U.S. 5th Fleet area of responsibility conducting maritime security operations, theater security cooperation efforts and support missions as part of Operation Enduring Freedom. U.S. Navy photo by Mass Communication Specialist 3rd Class Scott Pittman (Released) 120815-N-FI736-070
Surgical staff members assigned to the Military Sealift Command hospital ship USNS Mercy (T-AH 19) prep Cpl. Aaron Morice for a surgical procedure before the final surgery of Pacific Partnership 2012. Pacific Partnership, an annual U.S. Pacific Fleet humanitarian and civic assistance mission, brings together U.S. military personnel, host and partner nations, non-government organizations and international agencies to build stronger relationships and develop disaster response capabilities throughout the Asia-Pacific region. U.S. Navy photo by Mass Communication Specialist 2nd Class Roadell Hickman (Released) 120814-N-KW566-006
An E/A-18G Growler, assigned to Electronic Attack Squadron (VAQ) 129, lands on the flight deck of the aircraft carrier USS Nimitz (CVN 68), making it the 300,000th arresting gear trap since Nimitz was commissioned. Nimitz is underway conducting fleet replacement squadron carrier qualifications in the Pacific Ocean. U.S. Navy photo by Mass Communication Specialist 3rd Class Jonathan A. Colon (Released) 120815-N-FR671-185
FORMER HALL OF FAME COLLEGE FOOTBALL COACH CHARGED IN $80 MILLION PONZI SCHEME
FROM: U.S .SECURITIES AND EXCHANGE COMMISSION
Washington, D.C., Aug. 16, 2012 – The Securities and Exchange Commission today announced fraud charges against a former college football coach who teamed with an Ohio man to conduct an $80 million Ponzi scheme that included other college coaches and former players among its victims.
The SEC alleges that Jim Donnan, a College Football Hall of Fame inductee who guided teams at Marshall University and the University of Georgia and later became a television commentator, conducted the fraud with his business partner Gregory Crabtree through a West Virginia-based company called GLC Limited. Donnan and Crabtree told investors that GLC was in the wholesale liquidation business and earning substantial profits by buying leftover merchandise from major retailers and reselling those discontinued, damaged, or returned products to discount retailers. They promised investors exorbitant rates of return ranging from 50 to 380 percent. However, only about $12 million of the $80 million raised from nearly 100 investors was actually used to purchase leftover merchandise, and the remaining funds were used to pay fake returns to earlier investors or stolen for other uses by Donnan and Crabtree.
"Donnan and Crabtree convinced investors to pour millions of dollars into a purportedly unique and profitable business with huge potential and little risk," said William P. Hicks, Associate Director of the SEC’s Atlanta Regional Office. "But they were merely pulling an old page out of the Ponzi scheme playbook, and the clock eventually ran out."
According to the SEC’s complaint filed in federal court in Atlanta, the scheme began in August 2007 and collapsed in October 2010. Donnan recruited the majority of investors by approaching contacts he made as a sports commentator and as a coach. For instance, he capitalized on his influence over one former player by telling him, "Your Daddy is going to take care of you" … "if you weren’t my son, I wouldn’t be doing this for you." The player later invested $800,000.
The SEC’s complaint alleges that Donnan touted GLC’s success and profitability and told investors that the company could enter into even more merchandise deals with more capital. Donnan and Crabtree offered and sold investments that were short-term (2 to 12 months) and purportedly high-yield, with returns paid to investors in monthly or quarterly installments or in a one-time payment. Donnan told investors their money was being used to purchase specific items of merchandise that was often presold, so there was little to no risk to investing in any deal. However, much of the merchandise that GLC actually purchased was merely left unsold and abandoned in warehouses in West Virginia and Ohio.
The SEC alleges that Donnan typically assured investors that he was investing along with them in any merchandise deal that he offered. He touted that he and other prominent college football coaches had successfully and profitably invested in GLC. But by the time the scheme collapsed, Donnan had actually siphoned more than $7 million away from GLC, and Crabtree misappropriated approximately $1.08 million in investor funds.
The SEC’s complaint charges Donnan, who lives in Athens, Ga., and Crabtree, who resides in Proctorville, Ohio, with violations of the antifraud and registration provisions of the federal securities laws. The complaint also names two of Donnan’s children and his son-in-law as relief defendants for the purpose of recovering illicit funds that Donnan steered to them.
The SEC’s investigation was conducted in the Atlanta Regional Office by staff attorney Micheal D. Watson and Assistant Regional Director Stephen E. Donahue. The SEC’s litigation will be led by W. Shawn Murnahan.
Washington, D.C., Aug. 16, 2012 – The Securities and Exchange Commission today announced fraud charges against a former college football coach who teamed with an Ohio man to conduct an $80 million Ponzi scheme that included other college coaches and former players among its victims.
The SEC alleges that Jim Donnan, a College Football Hall of Fame inductee who guided teams at Marshall University and the University of Georgia and later became a television commentator, conducted the fraud with his business partner Gregory Crabtree through a West Virginia-based company called GLC Limited. Donnan and Crabtree told investors that GLC was in the wholesale liquidation business and earning substantial profits by buying leftover merchandise from major retailers and reselling those discontinued, damaged, or returned products to discount retailers. They promised investors exorbitant rates of return ranging from 50 to 380 percent. However, only about $12 million of the $80 million raised from nearly 100 investors was actually used to purchase leftover merchandise, and the remaining funds were used to pay fake returns to earlier investors or stolen for other uses by Donnan and Crabtree.
"Donnan and Crabtree convinced investors to pour millions of dollars into a purportedly unique and profitable business with huge potential and little risk," said William P. Hicks, Associate Director of the SEC’s Atlanta Regional Office. "But they were merely pulling an old page out of the Ponzi scheme playbook, and the clock eventually ran out."
According to the SEC’s complaint filed in federal court in Atlanta, the scheme began in August 2007 and collapsed in October 2010. Donnan recruited the majority of investors by approaching contacts he made as a sports commentator and as a coach. For instance, he capitalized on his influence over one former player by telling him, "Your Daddy is going to take care of you" … "if you weren’t my son, I wouldn’t be doing this for you." The player later invested $800,000.
The SEC’s complaint alleges that Donnan touted GLC’s success and profitability and told investors that the company could enter into even more merchandise deals with more capital. Donnan and Crabtree offered and sold investments that were short-term (2 to 12 months) and purportedly high-yield, with returns paid to investors in monthly or quarterly installments or in a one-time payment. Donnan told investors their money was being used to purchase specific items of merchandise that was often presold, so there was little to no risk to investing in any deal. However, much of the merchandise that GLC actually purchased was merely left unsold and abandoned in warehouses in West Virginia and Ohio.
The SEC alleges that Donnan typically assured investors that he was investing along with them in any merchandise deal that he offered. He touted that he and other prominent college football coaches had successfully and profitably invested in GLC. But by the time the scheme collapsed, Donnan had actually siphoned more than $7 million away from GLC, and Crabtree misappropriated approximately $1.08 million in investor funds.
The SEC’s complaint charges Donnan, who lives in Athens, Ga., and Crabtree, who resides in Proctorville, Ohio, with violations of the antifraud and registration provisions of the federal securities laws. The complaint also names two of Donnan’s children and his son-in-law as relief defendants for the purpose of recovering illicit funds that Donnan steered to them.
The SEC’s investigation was conducted in the Atlanta Regional Office by staff attorney Micheal D. Watson and Assistant Regional Director Stephen E. Donahue. The SEC’s litigation will be led by W. Shawn Murnahan.
HUNGARY: PROFILE FROM U.S. STATE DEPARTMENT
PROFILE
Geography
Area: 93,030 sq. km. (35,910 sq. mi.); about the size of Indiana.
Cities: Capital--Budapest (est. pop. 2 million). Other cities--Debrecen (208,000); Miskolc (170,000); Szeged (170,000); Pecs (157,000).
Terrain: Mostly flat, with low mountains in the north and northeast and north of Lake Balaton.
Climate: Temperate.
People
Nationality: Noun and adjective--Hungarian(s).
Population (July 2011 est.): 9,996,000.
Ethnic groups: Magyar 89.9%, Romany 4% (est.), German 2.6%, Serb 2%, Slovak 0.8%, Romanian 0.7%.
Religions (2001 census): Roman Catholic 51.9%, Calvinist 15.9%, Lutheran 3%, Greek Catholic 2.6%, Jewish 1%, others, including Baptist Adventist, Pentecostal, Unitarian 3%.
Languages: Magyar 98.2%, other 1.8%.
Education: Compulsory to age 16. Attendance--96%. Literacy--99.4%.
Health (2007 est.): Infant mortality rate--8.21/1,000. Life expectancy--men 69.2 years, women 77.3 years.
Work force (2006 est., 4.21 million): Agriculture--5.0%; industry and commerce--31.0%; services--64.0%.
Government
Type: Republic.
Constitution: Adopted April 18, 2011; entered into effect January 1, 2012.
Branches: Executive--president (head of state), prime minister (head of government), cabinet. Legislative--National Assembly (386 members, 4-year term). Judicial--Curia (supreme court) and Constitutional Court.
Administrative regions: 19 counties plus capital region of Budapest.
Principal political parties: Fidesz-Hungarian Civic Party--center-right; Christian Democratic People’s Party (KDNP)--center-right; Hungarian Socialist Party (MSZP)--center-left; Democratic Coalition (DK)--center-left; Politics Can Be Different (LMP)--Green party; Movement for a Better Hungary (Jobbik)--far-right.
Economy
GDP: HUF 27,947 billion (approx. $115.96 billion, at year-end 2011 exchange rate of U.S. $1=HUF 241).
Annual growth rate (2011): 1.9%.
Per capita GDP (2011): $11,596.
Natural resources: bauxite, coal, natural gas, and arable land.
Agriculture/forestry (2010, 2.94% of GDP): Products--meat, corn, wheat, sunflower seeds, potatoes, sugar beets, and dairy products.
Industry and construction (2010, 25.9% of GDP): Types--machinery, vehicles, chemicals, precision and measuring equipment, computer products, medical instruments, pharmaceuticals, and textiles.
Trade (2010): Exports ($112.7 billion)--machinery, vehicles, food, beverages, tobacco, crude materials, manufactured goods, fuels and electric energy. Imports ($103.11 billion)--machinery, vehicles, manufactured goods, fuels and electric energy, food, beverages, and tobacco. Major markets--EU (Germany, Austria, Italy, France, U.K., Romania, Poland). Major suppliers--EU (Germany, Austria, Italy, France, Netherlands, Poland), Russia, and China.
PEOPLE AND HISTORY
Ethnic groups in Hungary include Magyar (nearly 90%), Romany, German, Serb, Slovak, and others. The majority of Hungary's people are Roman Catholic; other religions represented are Calvinist, Lutheran, Jewish, Baptist, Adventist, Pentecostal, and Unitarian. Magyar is the predominant language. Hungary has long been an integral part of Europe. It converted to Western Christianity before AD 1000. Although Hungary was a monarchy for nearly 1,000 years, its constitutional system preceded by several centuries the establishment of Western-style governments in other European countries.
Following the defeat of the Austro-Hungarian Dual Monarchy (1867-1918) at the end of World War I, Hungary lost two-thirds of its territory and one-third of its population. It experienced a brief but bloody communist dictatorship and counterrevolution in 1919, followed by a 25-year regency under Admiral Miklos Horthy. Although Hungary fought in most of World War II as a German ally, it fell under German military occupation on March 19, 1944 following an unsuccessful attempt to switch sides. Under Nazi occupation, the Hungarian Government executed or deported and seized the property of hundreds of thousands of its minority citizens, mostly members of the Jewish community. On January 20, 1945, a provisional government concluded an armistice with the Soviet Union and established the Allied Control Commission, under which Soviet, American, and British representatives held complete sovereignty over the country. The Commission's chairman was a member of Stalin's inner circle and exercised absolute control.
Communist Takeover
The provisional government, dominated by the Hungarian Communist Party (MKP), was replaced in November 1945 after elections which gave majority control of a coalition government to the Independent Smallholders' Party. The government instituted a radical land reform and gradually nationalized mines, electric plants, heavy industries, and some large banks. The communists ultimately undermined the coalition regime by discrediting leaders of rival parties and through terror, blackmail, and show trials. In elections tainted by fraud in 1947, the leftist bloc gained control of the government.
By February 1949, all opposition parties had been forced to merge with the MKP to form the Hungarian Workers' Party. In 1949, the communists held a single-list election and adopted a Soviet-style constitution, which created the Hungarian People's Republic. Between 1948 and 1953, the Hungarian economy was reorganized according to the Soviet model. In 1949, the country joined the Council for Mutual Economic Assistance (CMEA, or Comecon.) All private industrial firms with more than 10 employees were nationalized. Freedom of the press, religion, and assembly were strictly curtailed. The head of the Roman Catholic Church, Cardinal Jozsef Mindszenty, was sentenced to life imprisonment.
Forced industrialization and land collectivization soon led to serious economic difficulties, which reached crisis proportions by mid-1953. Imre Nagy replaced Rakosi as prime minister in 1953 and repudiated much of Rakosi's economic program of forced collectivization and heavy industry. He also ended political purges and freed thousands of political prisoners. However, the economic situation continued to deteriorate, and Rakosi succeeded in disrupting the reforms and in forcing Nagy from power in 1955 for "right-wing revisionism." Hungary joined the Soviet-led Warsaw Pact Treaty Organization the same year.
1956 Revolution
Pressure for change reached a climax on October 23, 1956, when security forces fired on Budapest students marching in support of Poland's confrontation with the Soviet Union. The ensuing battle quickly grew into a massive popular uprising. Fighting did not abate until the Central Committee named Imre Nagy as prime minister on October 25. Nagy dissolved the state security police, abolished the one-party system, promised free elections, and negotiated with the U.S.S.R. to withdraw its troops.
Faced with reports of new Soviet troops pouring into Hungary, despite Soviet Ambassador Andropov's assurances to the contrary, on November 1 Nagy announced Hungary's neutrality and withdrawal from the Warsaw Pact. In response, the Soviet Union launched a massive military attack on Hungary on November 3. Some 200,000 Hungarians fled to the West. Nagy and his colleagues took refuge in the Yugoslav Embassy. Party First Secretary Janos Kadar defected from the Nagy cabinet, fleeing to the Soviet Union. On November 4 he announced the formation of a new government. He returned to Budapest and, with Soviet support, carried out severe reprisals; thousands of people were executed or imprisoned. Despite a guarantee of safe conduct, Nagy was arrested and deported to Romania. In June 1958, Nagy was returned to Hungary, and, following a secret trial, was executed by the communist government.
Reform Under Kadar
In the early 1960s, Kadar announced a new policy under the motto of "He Who is Not Against Us is With Us," and introduced a relatively liberal cultural and economic course aimed at overcoming the post-1956 hostility toward him and his regime. In 1966, the Central Committee approved the "New Economic Mechanism," through which it sought to overcome the inefficiencies of central planning, increase productivity, make Hungary more competitive in world markets, and create prosperity to ensure political stability. By the early 1980s, it had achieved some lasting economic reforms and limited political liberalization and pursued a foreign policy which encouraged more trade with the West. Nevertheless, the New Economic Mechanism led to mounting foreign debt incurred to shore up unprofitable industries.
Transition to Democracy
Hungary's transition to a Western-style parliamentary democracy was the first and the smoothest among the former Soviet bloc. By 1987, activists within the party and bureaucracy and Budapest-based intellectuals were increasingly pressing for change. Young liberals formed the Federation of Young Democrats (Fidesz); a core from the so-called Democratic Opposition formed the Association of Free Democrats (SZDSZ), and the neo-populist national opposition established the Hungarian Democratic Forum (MDF). Civic activism intensified to a level not seen since the 1956 revolution.
In 1988, Kadar was replaced as General Secretary of the MSZMP (the Communist Party), and that same year, the Parliament adopted a "democracy package," which included trade union pluralism; freedom of association, assembly, and the press; a new electoral law; and a radical revision of the constitution, among others. The Soviet Union reduced its involvement by signing an agreement in April 1989 to withdraw Soviet forces by June 1991.
National unity culminated in June 1989 as the country reburied Imre Nagy, his associates, and, symbolically, all other victims of the 1956 revolution. A national roundtable, comprising representatives of the new parties and some recreated old parties--such as the Smallholders and Social Democrats--the Communist Party, and different social groups, met in the late summer of 1989 to discuss major changes to the Hungarian constitution in preparation for free elections and the transition to a fully free and democratic political system.
Free Elections and a Democratic Hungary
The first free parliamentary election, held in March-April 1990, was a plebiscite of sorts on the communist past with the Democratic Forum (MDF) winning 43% of the vote and the Free Democrats (SZDSZ) capturing 24%. Under Prime Minister Jozsef Antall, the MDF formed a center-right coalition government with the Independent Smallholders' Party (FKGP) and the Christian Democratic People's Party (KDNP) to command a 60% majority in the Parliament. Parliamentary opposition parties included SZDSZ, the Socialists (MSZP--successors to the Communist Party), and the Alliance of Young Democrats (Fidesz). Peter Boross succeeded as Prime Minister after Antall died and the Antall/Boross coalition governments achieved a reasonably well-functioning parliamentary democracy and laid the foundation for a free market economy.
In May 1994, the Socialists came back to win a plurality of votes and 54% of the seats after an election campaign focused largely on economic issues and the substantial decline in living standards since 1990. A heavy turnout of voters swept away the right-of-center coalition but soundly rejected extremists on both right and left. The MSZP continued economic reforms and privatization, adopting a painful, but necessary, policy of fiscal austerity (the "Bokros plan") in 1995. However, dissatisfaction with the pace of economic recovery, rising crime, and cases of government corruption convinced voters to propel center-right parties into power following national elections in May 1998. Fidesz captured a plurality of parliamentary seats and forged a coalition with the Smallholders and the Democratic Forum. The new government, headed by 35-year-old Prime Minister Viktor Orban, promised to stimulate faster growth, curb inflation, and lower taxes. Although the Orban administration also pledged continuity in foreign policy, and continued to pursue Euro-Atlantic integration as its first priority, it was a more vocal advocate of minority rights for ethnic Hungarians abroad than the previous government. During Orban’s tenure, Hungary acceded to NATO on March 12, 1999.
In April 2002, the country voted to return the MSZP-Free Democrat coalition to power with Peter Medgyessy as Prime Minister. The Medgyessy government placed special emphasis on solidifying Hungary's Euro-Atlantic course, which culminated in Hungary’s accession to the European Union on May 1, 2004. Prime Minister Medgyessy resigned in August 2004 after losing coalition support following an attempted cabinet reshuffle. Ferenc Gyurcsany succeeded Medgyessy as Prime Minister in September 29, 2004.
In the April 2006 election, Prime Minister Ferenc Gyurcsany and his Socialist-liberal coalition were re-elected, the first time since communism that a sitting government renewed its mandate. The SZDSZ pulled out of the coalition in April 2008, leaving the MSZP to govern alone.
The global economic crisis spilled over into Hungary in autumn 2008, and severely impacted the country. Prime Minister Gyurcsany resigned in March 2009 and was succeeded by a technocratic crisis management government led by Gordon Bajnai, the former Minister of Economy and National Development.
Parliamentary elections in April 2010 brought a Fidesz-KDNP coalition back to power with a two-thirds majority (262 seats). Viktor Orban became Prime Minister. Joining the MSZP in opposition were the newly elected far-right Jobbik party and the Green party, Politics Can Be Different (LMP). Today, Fidesz-KDNP has 263 seats. In the opposition, MSZP has 48 seats, Jobbik 46, and LMP 15; 10 Members of Parliament (MPs) have left MSZP to create a new party, the Democratic Coalition. There are four independent MPs. The Fidesz-dominated Parliament quickly launched an ambitious legislative agenda that has promised to reduce the overall number of seats in Parliament to 199 effective for the next election in 2014, cut by half the number of local representatives, and extended citizenship and voting rights to ethnic Hungarians living beyond the country’s present borders. In April 2011, Parliament adopted the country’s new constitution, which entered into effect January 1, 2012. Among other changes, the document makes reference to the role of Christianity in "preserving the nation" and sets the term of local government members at 5 years. Additionally, it mandated a process requiring the passage of several dozen so-called cardinal laws on issues such as religion, the media, the restructuring of the judiciary, elections, and the central bank. The majority of these laws were passed in 2011, and their future modification would require a two-thirds majority in Parliament.
GOVERNMENT AND POLITICAL CONDITIONS
The president of Hungary, elected by the National Assembly every 5 years, has a largely ceremonial role, but powers include requesting the winner of a parliamentary election to form a cabinet. That person then presents his program to Parliament, and is in turn ratified by that body as prime minister. The prime minister selects cabinet ministers and has the exclusive right to dismiss them. Each cabinet nominee appears before one or more parliamentary committees in consultative open hearings and must be formally approved by the president. The unicameral, 386-member National Assembly is the highest state legislative body and initiates and approves legislation sponsored by the prime minister. The number of seats will decrease to 199 for the 2014 election. National parliamentary elections are held every 4 years (the last in April 2010). A party must win at least 5% of the national vote to enter Parliament. A 15-member Constitutional Court may challenge legislation on grounds of unconstitutionality; members are appointed by a two-thirds vote in Parliament for a 12-year term of office.
Principal Government Officials
President--Pal Schmitt
Prime Minister--Viktor Orban (Fidesz)
Minister of Foreign Affairs--Janos Martonyi
Ambassador to the United States--Gyorgy Szapary
Ambassador to the United Nations--Csaba Korosi
ECONOMY
Prior to World War II, the Hungarian economy was primarily oriented toward agriculture and small-scale manufacturing. Hungary's strategic position in Europe and its relative lack of natural resources dictated a traditional reliance on foreign trade. In the early 1950s, the communist government forced rapid industrialization following the standard Stalinist pattern in an effort to encourage a more self-sufficient economy. Most economic activity was conducted by state farms and state-owned enterprises or cooperatives. In 1968, Stalinist self-sufficiency was replaced by the "New Economic Mechanism," which gave limited freedom to the workings of the market, reopened Hungary to foreign trade, and allowed a limited number of small businesses to operate in the services sector.
Although Hungary enjoyed one of the most liberal and economically advanced economies of the former Eastern Bloc, both agriculture and industry began to suffer from a lack of investment in the 1970s. Belated reaction to the economic crisis of the early 1970s and deteriorating terms of trade resulted in increasing indebtedness. In response, the Hungarian Government launched a restrictive economic policy in the late 1970s and early 1980s, followed by the "Dynamization Program of 1985," which increased consumer subsidies and investments--mainly in unprofitable state enterprises--eventually leading to a doubling of foreign debt levels. By 1993, Hungary's net foreign debt rose significantly--from $1 billion in 1973 to $15 billion. Liberalization of the economy continued, however, and in 1988-89 Hungary passed a joint venture law, adopted tax legislation, and joined the International Monetary Fund (IMF) and the World Bank. By 1988, Hungary developed a two-tier banking system and enacted significant corporate legislation which paved the way for the ambitious market-oriented reforms of the post-communist years.
The Antall government of 1990-94 began market reforms with price and trade liberation measures, a revamped tax system, and a nascent market-based banking system. As a result of the collapse of Eastern markets and the inability of state-owned companies to compete with foreign competitors, industrial production fell by 50% between 1989 and 1994, and the country faced high unemployment and inflation rates, as well as a deteriorating trade balance. By 1994, the costs of government overspending and hesitant privatization had become clearly visible. In 1996, austerity measures referred to as the "Bokros package" (for then-Finance Minister Lajos Bokros) improved both the fiscal and external balance situation, and increased investor confidence. Simplified and accelerated privatization led to significant inflow of foreign capital in industry, energy, and telecommunications sectors, and a number of greenfield investments were launched. Hungary's early openness to foreign direct investment (FDI) led to a sustained period of high growth and made Hungary a magnet for FDI in the late 1990s and early parts of this century.
In 1995, Hungary's currency--the forint (HUF)--became convertible for all current account transactions, and subsequent to Organization for Economic Cooperation and Development (OECD) membership in 1996, for almost all capital account transactions as well. In 2001, the Orban government lifted remaining currency controls and broadened the band around the exchange rate, allowing the forint to appreciate by more than 12% in a year. Trade with European Union (EU) and OECD countries now comprises over 75% and 85% of Hungary's total trade, respectively. Germany is Hungary's most important trading partner, followed by Italy and France. The United States has become Hungary's sixth-largest export market, while Hungary is ranked as the 72nd-largest export market for the United States. Bilateral trade between the two countries has increased to more than $1 billion per year.
With more than $60 billion in FDI since 1989, Hungary has been a leading destination for FDI in central and eastern Europe, although this level is beginning to decline. The largest U.S. investors include GE, Alcoa, General Motors, Coca-Cola, Ford, IBM, and PepsiCo, with the overall level of direct U.S. investment estimated at $9 billion. As a result of extensive and continuing liberalization, the private sector produces about 80% of Hungary’s output.
Close relationship with the economies of the EU helped pave the way for Hungary's EU accession in 2004. As part of its EU membership agreement, Hungary agreed to meet the economic criteria necessary to adopt the euro. In 2005 and 2006, however, it became clear that not only was a high budget deficit hurting the economy (nearly surpassing 10% of GDP in 2006), but that Hungary was moving away from meeting euro entry requirements, and would be subject to EU excessive deficit procedures. Against this backdrop, in fall 2006, Prime Minister Gyurcsany launched a program of fiscal consolidation by raising taxes, decreasing subsidies, and streamlining the public sector. Businesses complained, however, that increased taxes, particularly on labor, decreased Hungary's economic competitiveness compared to other countries in the region. Greater fiscal discipline allowed the government to reduce its deficit to 3.4% of GDP by 2008, but decreasing government spending during this period also reduced domestic consumption and contributed to a decrease in Hungary's GDP growth.
In October 2008, the effects of the global financial crisis spilled into Hungary. Despite its success in reducing its fiscal deficit, years of high budget deficits and Hungary’s high external debt levels fueled investor risk aversion, and negatively affected the foreign exchange, government securities, and equity markets in Hungary. The country was hit hard by global de-leveraging, and weak demand for government bonds. A sharp decline in the share of non-resident investors in the government securities market raised concerns that Hungary would be unable to meet its external financing requirements. In order to increase investor confidence and ensure liquidity in domestic financial markets, Hungary concluded a $25 billion financial stabilization package with the IMF, EU, and World Bank in November 2008.
Under this agreement, Hungary committed to further fiscal consolidation, financial sector reforms, and enacting banking sector support measures. Terms also included periodic assessment of macroeconomic and fiscal targets. Taking into consideration the worsening global economic and financial crisis, the IMF and the EU revised their projections of Hungary’s GDP decline in 2009 to -6.7%, and agreed to increase the 2.9% deficit target to 3.9% for 2009. Public debt was expected to increase to 83% of GDP in 2009 before returning to more sustainable levels through fiscal tightening.
To respond to the crisis, the Bajnai government in 2009 enacted a series of economic reforms and spending cuts intended to reduce the tax burden on labor, encourage employment, improve Hungary's economic competitiveness, and offset lost government revenue due to the deeper-than-expected recession. These measures included reforms to the pension and entitlement systems, as well as tax changes to shift the tax burden from labor to wealth and consumption. In addition to cuts in taxes for businesses and employees, tax changes included raising the value added tax (VAT), and a proposal for the introduction of a property tax. In 2009 GDP declined by 6.3%, and the Hungarian Government was able to meet the 3.9% deficit target.
Elected in 2010, the Orban government adopted what Economy Minister Gyorgy Matolcsy described as an "unorthodox economic policy" to help steer Hungary through the economic crisis. This included the introduction of "crisis taxes" targeting banking, energy, telecommunications, and retail sectors. Originally unveiled as 3-year, limited-duration, and extraordinary measures, the crisis taxes were meant to shore up the government budget until more long-term, structural changes were made. In November 2010, the government acknowledged that the "crisis taxes" would exist in some form until 2014, 2 years later than previously asserted. In addition, in 2010 the government discontinued contributions to the voluntary private pillar of the pension system, and imposed financial disincentives on those who chose not to return to the state system. The government has used the resulting budgetary windfall to help reduce the country's debt levels and meet its deficit target of less than 3% for 2011 and 2012.
In March 2011, the government launched its Szell Kalman Plan, which outlines structural reform plans in the areas of local government finance, education, healthcare, employment, and public transportation for 2011-2014. The government began developing more detailed reform implementation plans in each of these areas. Initial market reaction to the plan was positive, and by May 2011, the country had already met its foreign currency financing requirements for 2011 through two large dollar and euro bond issuances.
Amid worsening investor sentiment and distrust toward the government’s economic policy, all three credit rating agencies in December 2011-January 2012 downgraded Hungary to non-investment grade, which resulted in a sharp depreciation of the Hungarian forint to almost 350 to the euro and a corresponding increase in government bond yields from below 7% to about 10%. Rising yields and the depreciating forint made the Debt Management Agency’s plan to issue 4.8 billion euros worth (approx. $6.3 billion) of foreign-currency denominated bonds questionable and prompted the government to seek a credit line from the EU and the IMF. Discussions are ongoing, but conditions are strict. The EU Commission initiated an infringement procedure in January 2012 requiring Hungary to change legislation hampering independence of the Central Bank, restore the authority of the Data Protection Ombudsman, and other issues. At the same time the ECOFIN Council voted to proceed with an Excessive Deficit Procedure against Hungary on the grounds that its 3% budget deficit target is unsustainable in 2013 unless corrective measures are implemented. The stakes are high for Hungary, which might partially or entirely lose support from the EU Cohesion Funds in 2013.
NATIONAL SECURITY
Hungary's key national security focus since joining NATO in 1999 has been contributing to the stability of the region while integrating its armed forces into NATO's force structure. Hungary takes a keen interest in NATO expansion and in the transatlantic link. It shares a more acute sense of the threat than many other European countries and is watching events in the Balkans, Ukraine, and Russia with great interest. Hungarians believe that Hungary's own security and that of its ethnic minorities in neighboring countries will be best served by a peaceful, unified region, which will be achieved when EU and NATO membership is extended to the entire region.
Hungary has been slowly modernizing and downsizing its armed forces since it left the Warsaw Pact in 1990. Transitioning from a heavy, slow-moving Warsaw Pact force to a lighter, versatile NATO force, the Hungarian military went from 130,000 in 1989 to approximately 24,000 combat and combat support forces in 2008. Implementing a new training, logistics, and leadership system and a new Joint Forces Command structure, the Hungarian military has gained considerable practical experience working with NATO and other forces serving in international military missions (about 1,000 at any given time). Hungary was especially helpful during the implementation of the Dayton Peace Accords in the Balkans from 1995-2004, when its airbase at Taszar was used by coalition forces transiting the region. Hungary currently leads a Provincial Reconstruction Team (PRT) in Afghanistan. It deployed an additional Operational Mentoring and Liaison Team (OMLT)--operating in partnership with the Ohio National Guard--an Air Mentor Team, and Special Forces personnel in Afghanistan. The Hungarian military is also deployed in Bosnia-Herzegovina, Kosovo, Cyprus, and the Sinai Peninsula on international peacekeeping and stabilization missions. Hungary’s Papa Airbase is the home base of the Strategic Airlift Consortium’s C-17 operations, expanding its contribution to NATO and other European partners. Hungary’s military still faces numerous challenges to its modernization program, as reflected in the country’s defense budget, which in recent years has dropped to less than 1% of GDP, well below the NATO target of 2%.
FOREIGN RELATIONS
Except for the short-lived neutrality declared by Imre Nagy in November 1956, Hungary's foreign policy generally followed the Soviet lead from 1947 to 1989. During the communist period, Hungary maintained treaties of friendship, cooperation, and mutual assistance with the Soviet Union, Poland, Czechoslovakia, the German Democratic Republic, Romania, and Bulgaria. It was one of the founding members of the Soviet-led Warsaw Pact and Comecon, and it was the first central European country to withdraw from those now-defunct organizations.
As with any country, Hungarian security attitudes are shaped largely by history and geography. For Hungary, this is a history of more than 400 years of domination by great powers--the Ottomans, the Habsburgs, the Germans during World War II, and the Soviets during the Cold War. Hungary's foreign policy priorities, largely consistent since 1990, represent a direct response to these factors. Since 1990, Hungary's top foreign policy goal has been achieving integration into Western economic and security organizations. To this end, Hungary joined NATO in 1999 and the European Union in May of 2004. Hungary also has improved its often-chilled neighborly relations by signing basic treaties with Romania, Slovakia, and Ukraine. These renounce all outstanding territorial claims and lay the foundation for constructive relations. However, the issue of ethnic Hungarian minority rights in Slovakia and Romania periodically causes bilateral tensions to flare, including in June 2010 when the Parliament offered Hungarian citizenship to ethnic Hungarians living outside its borders. Hungary was a signatory to the Helsinki Final Act in 1975, has signed all of the Conference on Security and Cooperation in Europe (CSCE)/Organization for Security and Cooperation in Europe (OSCE) follow-on documents since 1989, and served as the OSCE's Chairman-in-Office in 1997. Hungary's record of implementing CSCE Helsinki Final Act provisions, including those on reunification of divided families, remains among the best in eastern Europe. Hungary has been a member of the United Nations since December 1955.
During the first 6 months of 2011, Hungary held the rotating presidency of the Council of the European Union for the first time. The priorities of the Hungarian presidency, as outlined in its program entitled "Strong Europe," included the promotion of Roma integration, supporting growth and increasing employment in the EU, expansion of the Schengen border regime area, and the enlargement of the European Union, with special emphasis on Croatia’s accession.
U.S.-HUNGARIAN RELATIONS
Relations between the United States and Hungary immediately following World War II were affected by the Soviet armed forces' occupation of Hungary. Full diplomatic relations were established at the legation level on October 12, 1945, before the signing of the Hungarian peace treaty on February 10, 1947. After the communist takeover in 1947-48, relations with Hungary became increasingly strained by the nationalization of U.S.-owned property, unacceptable treatment of U.S. citizens and personnel, and restrictions on the operations of the American legation. Though relations deteriorated further after the suppression of the Hungarian national uprising in 1956, an exchange of ambassadors in 1966 inaugurated an era of improving relations. In 1972, a consular convention was concluded to provide consular protection to U.S. citizens in Hungary.
In 1973, a bilateral agreement was reached under which Hungary settled the nationalization claims of American citizens. In January 1978, the United States returned to the people of Hungary the historic Crown of Saint Stephen, which had been safeguarded by the United States since the end of World War II. Symbolically and literally, this event marked the beginning of improved relations between the two countries. A 1978 bilateral trade agreement included extension of most-favored-nation status to Hungary. Cultural and scientific exchanges were expanded. As Hungary began to pull away from the Soviet orbit, the United States offered assistance and expertise to help establish a constitution, a democratic political system, and a plan for a free market economy.
Between 1989 and 1993, the Support for East European Democracy (SEED) Act provided more than $136 million for economic restructuring and private sector development. The Hungarian-American Enterprise Fund offered loans, equity capital, and technical assistance to promote private-sector development. The U.S. Government has provided expert and financial assistance for the development of modern and Western institutions in many policy areas, including national security, law enforcement, free media, environmental regulations, education, and health care. American direct investment has had a direct, positive impact on the Hungarian economy and on continued good bilateral relations. When Hungary acceded to NATO in April 1999, it became a formal ally of the United States. This move has been consistently supported by the 1.5 million-strong Hungarian-American community. The U.S. Government supported Hungarian European Union accession in 2004, and continues to work with Hungary as a valued partner in the transatlantic relationship. Hungary joined the Visa Waiver Program on November 17, 2008.
DISCOVERY MAY CHANGE THEORIES ON GALAXY EVOLUTION
FROM: NATIONAL SCIENCE FOUNDATION
National Science Foundation-funded radio telescope in Antarctica has found an extraordinary galaxy cluster that may force astronomers to rethink how galaxy clusters and the galaxies that inhabit them evolve.
The galaxy cluster was discovered some 5.7 billion light years from Earth by the 10-meter wide South Pole Telescope (SPT) located at NSF's Amundsen-Scott South Pole Station in Antarctica, which is funded by NSF's Office of Polar Programs.
NSF manages the U.S. Antarctic Program, through which it coordinates all U.S research and required logistical support on the continent as well as aboard ships in the Southern Ocean.
Officially known as SPT-CLJ2344-4243, the cluster has been dubbed the "Phoenix Cluster" because it is located in the constellation of the Phoenix and because of its remarkable properties. Scientists taking part in the SPT collaboration found the cluster using the Sunyaev-Zel'dovich (SZ) effect, the result of high energy electrons distorting the cosmic microwave background (CMB) radiation through inverse Compton scattering, in which the low energy CMB photons receive an average energy boost during collision with the high energy cluster electrons.
Galaxy clusters, which are among the largest objects in the universe, contain enough hot gas to create detectable "shadows" in the light left over from the Big Bang, which also is known as CMB radiation.
"The mythology of the Phoenix--a bird rising from the dead--is a perfect way to describe this revived object," said Michael McDonald, a Hubble Fellow at the Massachusetts Institute of Technology and the lead author of a paper appearing in the August 16 issue of the journal Nature. "While galaxies at the center of most clusters have been dead for billions of years, the central galaxy in this cluster seems to have come back to life."
Observations made by NASA's Chandra X-ray Observatory in space and by the NSF-managed Gemini Observatory and the Blanco 4-meter and Magellan telescopes in Chile corroborate the SPT discovery and show that stars are forming in this object at the highest rate ever seen in the middle of a galaxy cluster. The object also is the most powerful producer of X-rays of any known cluster, and among the most massive of clusters. The data also suggest that the rate of hot gas cooling in the central regions of the cluster is the largest ever observed.
This light has travelled for 14 billion years across the entire observable universe to get to Earth. If it passes through a massive cluster on its way, then a tiny fraction of the light gets scattered to higher energies--the SZ effect.
Predicted in 1972, the SZ effect was first demonstrated to detect previously unknown clusters of galaxies by the SPT collaboration in 2009. Observations of the effect have since opened a new window for astronomers to discover the most massive, distant clusters in the universe.
"The beauty of the SZ effect for cosmology is that it is as easy to detect a cluster of galaxies in the distant reaches of the observable universe as it is for one nearby," said John Carlstrom, the S. Chandrasekhar Distinguished Service Professor in Astronomy & Astrophysics at the University of Chicago and the SPT's principal investigator. "The magnitude of the effect depends on the mass of the object and not its distance from Earth."
Like other galaxy clusters, Phoenix contains a vast reservoir of hot gas, containing more normal matter than all of the galaxies in the cluster combined. The emission from this reservoir can only be detected with X-ray telescopes like NASA's Chandra X-ray Observatory. The prevailing wisdom had once been that this hot gas should cool over time and sink to the center of the cluster, forming huge numbers of stars.
However, central galaxies in the cluster have formed very few stars over the last few billion years. Astronomers think that the super-massive black hole in the central galaxy of a cluster pumps energy into the system, preventing cooling of gas from causing a burst of star formation. The famous Perseus Cluster is an example of a black hole bellowing out energy and preventing the gas from cooling to form stars at a high rate.
With the black hole not producing powerful enough jets to halt cooling, the center of the Phoenix cluster is buzzing with stars that are forming 20 times faster than in the Perseus Cluster. This rate is the highest seen in the center of a galaxy cluster and is comparable to the highest seen anywhere in the universe.
The frenetic pace of star birth and cooling of gas in Phoenix are causing both the galaxy and the black hole to add mass very quickly--an important phase that the researchers predict will be relatively short-lived.
"The galaxy and its black hole are undergoing unsustainable growth," said co-author Bradford Benson, of the University of Chicago. "This growth spurt can't last longer than about a hundred million years; otherwise the galaxy and black hole would become much bigger than their counterparts in the nearby universe."
Remarkably, the Phoenix Cluster and its central galaxy and super-massive black hole are already among the most massive known objects of their type. Because of their tremendous size, galaxy clusters are crucial objects for studying cosmology and galaxy evolution, so finding one with such extreme properties as the Phoenix Cluster is significant.
The SPT collaboration has now completed an SZ survey of the 2500 square degrees of the southern sky that began in February 2007. It has found approximately 500 "SZ effect" galaxy clusters and published more than 20 papers in peer-reviewed journals. Further analysis of the collected data could reveal the existence of additional galaxy clusters.
The NSF-funded Physics Frontier Center of the University of Chicago's Kavli Institute for Cosmological Physics, the Department of Energy's Argonne National Laboratory, the Kavli Foundation, and the Gordon and Betty Moore Foundation also provide partial support for the SPT.
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