PRESIDENT OBAMA'S REMARKS IN THE ROSE GARDEN ON THE AFFORDABLE CARE ATC

FROM:  THE WHITE HOUSE 

Remarks by the President on the Affordable Care Act

REMARKS BY THE PRESIDENT

ON THE AFFORDABLE CARE ACT

Rose Garden

April 1, 2014

4:19 P.M. EDT

THE PRESIDENT:  Everybody, please have a seat.  Thank you so much.   Welcome to the White House. 

Six months ago today, a big part of the Affordable Care Act kicked in as healthcare.gov and state insurance marketplaces went live.  And millions of Americans finally had the same chance to buy quality, affordable health care -- and the peace of mind that comes with it -- as everybody else.

Last night, the first open-enrollment period under this law came to an end.  And despite several lost weeks out of the gate because of problems with the website, 7.1 million Americans have now signed up for private insurance plans through these marketplaces -- 7.1.  (Applause.)

The truth is, even more folks want to sign up.  So anybody who was stuck in line because of the huge surge in demand over the past few days can still go back and finish your enrollment -- 7.1 million, that’s on top of the more than 3 million young adults who have gained insurance under this law by staying on their family’s plan.  That’s on top of the millions more who have gained access through Medicaid expansion and the Children’s Health Insurance Program.  Making affordable coverage available to all Americans, including those with preexisting conditions, is now an important goal of this law.  (Applause.) 

And in these first six months, we’ve taken a big step forward.  And just as importantly, this law is bringing greater security to Americans who already have coverage.  Because of the Affordable Care Act, 100 million Americans have gained free preventive care, like mammograms and contraceptive care, under their existing plans.  (Applause.)  Because of this law, nearly 8 million seniors have saved almost $10 billion on their medicine because we’ve closed a gaping hole in Medicare’s prescription drug plan.  We’re closing the donut hole.  (Applause.)  And because of this law, a whole lot of families won’t be driven into bankruptcy by a serious illness, because the Affordable Care Act prevents your insurer from placing dollar limits on the coverage they provide.

These are all benefits that have been taking place for a whole lot of families out there, many who don’t realize that they’ve received these benefits.  But the bottom line is this:  Under this law, the share of Americans with insurance is up and the growth of health care costs is down, and that’s good for our middle class and that’s good for our fiscal future.  (Applause.)

Now, that doesn’t mean that all the problems in health care have been solved forever.  Premiums are still rising for families who have insurance, whether you get it through your employer or you buy it on your own -- that’s been true every year for decades.  But, so far, those premiums have risen more slowly since the Affordable Care Act passed than at any time in the past 50 years.  It’s also true that, despite this law, millions of Americans remain uncovered in part because governors in some states for political reasons have deliberately refused to expand coverage under this law.  But we’re going to work on that. And we’ll work to get more Americans covered with each passing year.  (Applause.)

And while it remains true that you’ll still have to change your coverage if you graduate from college or turn 26 years old or move or switch jobs, or have a child -- just like you did before the Affordable Care Act was passed -- you can now go to healthcare.gov and use it year-round to enroll when circumstances in your life change.  So, no, the Affordable Care Act hasn’t completely fixed our long-broken health care system, but this law has made our health care system a lot better -- a lot better.  (Applause.)

All told, because of this law, millions of our fellow citizens know the economic security of health insurance who didn’t just a few years ago -- and that’s something to be proud of.  Regardless of your politics or your feelings about me, or your feelings about this law, that’s something that’s good for our economy, and it’s good for our country.  And there’s no good reason to go back. 

Let me give you a sense of what this change has meant for millions of our fellow Americans.  I’ll just give you a few examples.  Sean Casey, from Solana Beach, California, always made sure to cover his family on the private market.  But preexisting medical conditions meant his annual tab was over $30,000.  The Affordable Care Act changed that.  See, if you have a preexisting condition, like being a cancer survivor, or if you suffer chronic pain from a tough job, or even if you’ve just been charged more for being a woman -– you can no longer be charged more than anybody else.  So this year, the Casey family’s premiums will fall from over $30,000 to under $9,000.  (Applause.) 

And I know this because Sean took the time to write me a letter.  “These savings,” he said, “will almost offset the cost of our daughter’s first year in college.  I’m a big believer in this legislation, and it has removed a lot of complexity and, frankly, fear from my life.  Please keep fighting for the ACA.”  That's what Sean had to say.

Jeanne Goe is a bartender from Enola, Pennsylvania.  Now, I think most folks are aware being a bartender, that's a job that usually doesn't offer health care.  For years, Jeanne went uninsured or underinsured, often getting some health care through her local Planned Parenthood.  In November, she bought a plan on the marketplace.  In January, an illness sent her to the hospital.  And because her new plan covered a CAT scan she wouldn’t have otherwise been able to afford, her doctor discovered that she also had ovarian cancer -– and gave her a chance to beat it.  So she wrote me a letter, too.  She said it’s going to be “a long tough road to kill this cancer, but I can walk that road knowing insurance isn’t an issue.  I won’t be refused care.  I hope to send a follow-up letter in a few months saying I am free and clear of this disease, but until then, I know I will be fighting just as you have been fighting for my life as a working American citizen.”

And after her first wellness visit under her new insurance plan, Marla Morine, from Fort Collins, Colorado, shared with me what it meant to her.  “After using my new insurance for the first time, you probably heard my sigh of relief from the White House.”  (Laughter.)  “I felt like a human being again.  I felt that I had value.”

That’s what the Affordable Care Act, or Obamacare, is all about -– making sure that all of us, and all our fellow citizens, can count on the security of health care when we get sick; that the work and dignity of every person is acknowledged and affirmed.  The newly insured like Marla deserve that dignity.  Working Americans like Jeanne deserve that economic security.  Women, the sick, survivors -- they deserve fair treatment in our health care system, all of which makes the constant politics around this law so troubling. 

Like every major piece of legislation -- from Social Security to Medicare -- the law is not perfect.  We’ve had to make adjustments along the way, and the implementation -- especially with the website -- has had its share of problems.  We know something about that.  And, yes, at times this reform has been contentious and confusing, and obviously it’s had its share of critics.  That’s part of what change looks like in a democracy.  Change is hard.  Fixing what’s broken is hard.  Overcoming skepticism and fear of something new is hard.  A lot of times folks would prefer the devil they know to the devil they don’t.

But this law is doing what it’s supposed to do.  It’s working.  It’s helping people from coast to coast, all of which makes the lengths to which critics have gone to scare people or undermine the law, or try to repeal the law without offering any plausible alternative so hard to understand.  I’ve got to admit, I don’t get it.  Why are folks working so hard for people not to have health insurance?  Why are they so mad about the idea of folks having health insurance?  Many of the tall tales that have been told about this law have been debunked.  There are still no death panels.  (Laughter.)  Armageddon has not arrived.  Instead, this law is helping millions of Americans, and in the coming years it will help millions more.

I’ve said before, I will always work with anyone who is willing to make this law work even better.  But the debate over repealing this law is over.  The Affordable Care Act is here to stay.  (Applause.)

And those who have based their entire political agenda on repealing it have to explain to the country why Jeanne should go back to being uninsured.  They should explain why Sean and his family should go back to paying thousands and thousands of dollars more.  They’ve got to explain why Marla doesn’t deserve to feel like she’s got value.  They have to explain why we should go back to the days when seniors paid more for their prescriptions or women had to pay more than men for coverage, back to the days when Americans with preexisting conditions were out of luck -- they could routinely be denied the economic security of health insurance -- because that’s exactly what would happen if we repeal this law.  Millions of people who now have health insurance would not have it.  Seniors who have gotten discounts on their prescription drugs would have to pay more.  Young people who were on their parents’ plan would suddenly not have health insurance. 

In the end, history is not kind to those who would deny Americans their basic economic security.  Nobody remembers well those who stand in the way of America’s progress or our people.  And that’s what the Affordable Care Act represents.  As messy as it’s been sometimes, as contentious as it’s been sometimes, it is progress.  It is making sure that we are not the only advanced country on Earth that doesn’t make sure everybody has basic health care.  (Applause.)  And that’s thanks in part to leaders like Nancy Pelosi and Dick Durbin, and all the members of Congress who are here today.  We could not have done it without them, and they should be proud of what they’ve done.  They should be proud of what they’ve done.  (Applause.) 

And it’s also thanks to the often-unheralded work of countless Americans who fought tirelessly to pass this law, and who organized like crazy these past few months to help their fellow citizens just get the information they needed to get covered.  That’s why we’re here today.  That’s why 7.1 million folks have health insurance -- because people got the word out. 

And we didn’t make a hard sell.  We didn’t have billions of dollars of commercials like some critics did.  But what we said was, look for yourself, see if it’s good for your family.  And a whole lot of people decided it was.  So I want to thank everybody who worked so hard to make sure that we arrived at this point today.

I want to make sure everybody understands:  In the months, years ahead, I guarantee you there will be additional challenges to implementing this law.  There will be days when the website stumbles -- I guarantee it.  So, press, just -- I want you to anticipate -- (laughter) -- there will be some moment when the website is down -- and I know it will be on all of your front pages.  It’s going to happen.  It won’t be news.  There will be parts of the law that will still need to be improved.  And if we can stop refighting old political battles that keep us gridlocked, then we could actually make the law work even better for everybody.  And we’re excited about the prospect of doing that.  We are game to do it.  (Applause.) 

But today should remind us that the goal we set for ourselves -- that no American should go without the health care that they need; that no family should be bankrupt because somebody in that family gets sick, because no parent should have to be worried about whether they can afford treatment because they’re worried that they don’t want to have to burden their children; the idea that everybody in this country can get decent health care -- that goal is achievable. 

We are on our way.  And if all of us have the courage and the wisdom to keep working not against one another, not to scare each other, but for one another –- then we won’t just make progress on health care.  We’ll make progress on all the other work that remains to create new opportunity for everybody who works for it, and to make sure that this country that we love lives up to its highest ideals.  That’s what today is about.  That’s what all the days that come as long as I’m President are going to be about.  That’s what we’re going to be working towards.

Thank you very much, everybody.  God bless you.  God bless America.  (Applause.)  Thank you. 

                                      END               

FTC TESTIFIES TO SENATE COMMITTEE REGARDING DATA SECURITY

FROM:  FEDERAL TRADE COMMISSION 
FTC Testifies on Data Security Before Senate Homeland Security and Governmental Affairs Committee
Commission Renews Call for Data Security Legislation

In testimony before Congress today, the Federal Trade Commission provided an update on its efforts to protect consumers’ privacy in the face of growing data breaches and renewed its call for data security legislation.

Testifying on behalf of the Commission before the Senate Committee on Homeland Security and Governmental Affairs, Chairwoman Edith Ramirez told lawmakers that the Commission believed that as more data breaches are revealed, the risk to consumers and businesses becomes clear.

“Consumers’ data is at risk,” the testimony states. “Recent publicly announced data breaches remind us that hackers and others seek to exploit vulnerabilities, obtain unauthorized access to consumers’ sensitive information, and potentially misuse it in ways that can cause serious harm to consumers as well as businesses.”

The testimony highlights the Commission’s wide-ranging efforts in the data security arena, including its enforcement of the FTC Act as well as specific statutes such as the Fair Credit Reporting Act, Children’s Online Privacy Protection Act, and the Gramm-Leach-Bliley Act to encourage companies to make data security a priority. The Commission has settled more than 50 such cases alleging that companies took inadequate measures to protect consumer data.  The testimony calls attention to recent settlements with Fandango and Credit Karma as part of the Commission’s effort to encourage companies to adopt security in the design of their products.

In addition, the testimony outlines the Commission’s policy initiatives related to data security issues, including workshops, seminars and reports on a wide variety of topics that affect the collection, use and security of consumers’ personal information. The testimony also notes the Commission’s ongoing efforts to educate consumers and provide guidance to businesses about issues related to data security.

In calling for legislation, the Commission’s testimony recommends that Congress strengthen its existing authority governing data security tools, and that it require companies in appropriate circumstances to notify consumers affected by a data breach. Specifically, the testimony calls for authority to seek civil penalties to help deter unlawful conduct, rulemaking authority under the Administrative Procedures Act, and jurisdiction over non-profit entities, which are not currently subject to FTC oversight.

The Commission vote approving the testimony and its inclusion in the formal record was 4-0.

SECRETARY KERRY'S REMARKS AT U.S..-EU ENERGY COUNCIL MEETING

FROM:  U.S. STATE DEPARTMENT 

Remarks at the U.S.-EU Energy Council Meeting

Remarks

John Kerry
Secretary of State

Brussels, Belgium

April 2, 2014

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Deputy Secretary Dan Poneman and I are very, very pleased to be here for the 5^th U.S.-EU Energy Council today, and I’m particularly happy to join High Representative Cathy Ashton who is doing a superb job in my judgment wearing a lot of hats and helping to fight fires in many places, as well as lead our efforts in the Iran nuclear talks. I’m delighted to be here with Commissioner Oettinger and Giannis Maniatis – thank you very much. We’re happy to be here with you also representing the EU presidency.

I think the difficulties of the recent days underscore the imperative to what brings us here today: energy security – not just for Ukraine but all across Europe – that it frankly requires a major amount of transatlantic cooperation and transatlantic leadership. And that’s why President Obama asked us to come together with our European partners in order to tackle these challenges head-on.

It really boils down to this: No nation should use energy to stymie a people’s aspirations. It should not be used as a weapon. It’s in the interest of all of us to be able to have adequate energy supplies critical to our economies, critical to our security, critical to the prosperity of our people. And we can’t allow it to be used as a political weapon or as an instrument for aggression. So we are taking important steps today in order to make it far more difficult for people to deploy that tool.

And we’re working in lock-step to help Ukraine bring natural gas in from Poland and Hungary and develop a route through Slovakia. Ukraine is committed to do its part. And through their recent commitments to the IMF they’ve agreed to act on energy subsidies and to make their energy market more competitive. This is critical, obviously.

The United States and the EU have a lot of work to do in order to diversify our energy supplies. We’re working on it very hard in the United States. President Obama’s implemented a climate action plan, and Europe – no group of nations have done more than the European community to try to move on this front. But we, all of us, have to make certain that we are not dependent on one single source of energy.

So our agenda today, or at least part of it, is going to be to look at how do we get more natural gas through what folks call the Southern corridor, from Azerbaijan to Turkey and on to Europe. There are also other opportunities, including LNG terminals planned across Europe, and pipelines that can get gas to customers.

I think it’s fair to say that American entrepreneurship is hard at work trying to help change this equation. Our new capacities as a gas producer and the approval of seven export licenses is going to help supply gas to global markets, and we look forward to doing that starting in 2015. And we will supply more gas than all of Europe consumes today.

So whether it’s confronting the immediate energy challenges in Ukraine, which is critical, or the absolute imperative of all of us meeting the challenge of climate change, which in the latest IPCC report we see underscored for its importance, we’re going to have a partnership – with a partnership between the United States and Europe is absolutely vital in this effort.
So we couldn’t be more pleased than to have leaders like Representative Ashton and Commissioner Oettinger alongside us today to begin this work, and we look forward to a really healthy, productive discussion. Thank you.

JOHN KERRY'S REMARKS TO PRESS AT NATO

FROM:  U.S. STATE DEPARTMENT 
Press Availability at NATO
Remarks
John Kerry
Secretary of State
Brussels, Belgium
April 1, 2014

SECRETARY KERRY: Well, good evening to everybody. This obviously could not be a more important time for NATO allies to come together and to reaffirm our commitment to each other, to the transatlantic treaty and transatlantic security, and especially to our common values. As we mark the 65th anniversary of the strongest alliance on earth, we are all facing a new challenge, a critical moment, a new reality on the Euro-Atlantic landscape at a time when some of the basic principles underlying the international system have been violated and, frankly, our alliance has been put to the test.

Let me reiterate what President Obama said in this city last week: Russia today has challenged truths that only a few weeks ago appeared to be self-evident; that in the 21st century, the borders of Europe would not be redrawn with force; and that international law still guides all of us; that people and nations must always be able to make their own decisions about their own future. It’s clear that the alliance is prepared for this moment. We heard that over and over again today from every participant. We are unified, and the alliance is strong.

Today, NATO allies tasked the Supreme Allied Commander to provide visible reassurance with respect to our Central and Eastern European allies, assurance that Article 5 of NATO’s treaty means what it says on land, air, and sea. The United States has already begun to contribute to this mission because, as President Obama reaffirmed to Secretary General Rasmussen last week and I reiterated to my colleagues here today, the United States commitment to Article 5 obligations is unwavering.

Now in recent weeks, the United States has augmented NATO’s Baltic air policing mission with six additional F-16s. We’ve deployed 12 F-16s to Poland. We’ve kept the USS Truxtun in the Black Sea and more U.S. support is on the way. Today, many allies pledged their own contributions to assure that every ally, from the Baltic to the Black Sea, feels secure.

Just as importantly, Europe and North America have stood together in defense of Ukraine’s right to choose its future and in defense of international law. Together, we have rejected any notion that there is any legality in Russia’s efforts to annex Crimea and challenged – we have all challenged - the tactics of intimidation, particularly the deployment of unprecedented amounts of military forces around Ukraine’s borders.

Ukraine’s democratic and economic success is, in the end, going to be the best response to this challenge. Every ally here today pledged unwavering support in order to help make sure that Ukraine succeeds. This includes support through the IMF, our bilateral and multilateral assistance, the OSCE monitors, and through our support for free, fair, constitutional elections and for constitutional reform, as well as the anticorruption and demobilization efforts that are taking place.

We also reaffirmed to Foreign Minister Deshchytsia that just as Ukraine has stood in partnership for the past two decades, it’s important that NATO stand in partnership now with Ukraine, and we endorsed a range of measures in order to do so. Secretary General Rasmussen has called the events in Ukraine a wake-up call – a reminder that the stability and security in NATO’s neighborhood requires all of our constant vigilance. To that end, today, I made clear that many members of the alliance now need to step up defense spending. As we plan for NATO’s summit in Wales this September, each of us must demonstrate by the decisions that we take and the budget commitments that we make that we are committed to each other, and by our shared security and our shared prosperity and our shared values, we will continue to maintain that strength.

This afternoon, we mark the five, ten, and fifteen-year anniversaries of NATO’s post-Cold War expansions. And it is clear that each of these expansions has actually strengthened NATO by opening doors for millions of people who, through the power of this alliance, now are able to experience greater opportunity, a greater prosperity, and greater security. As free nations, we will continue to stand together and stand always in defense of international law, of our mutual security, and of the right of nations and people everywhere to freely choose their own destiny. Our meeting today underscored these principles in both words and in deeds.

I’d be happy to take a couple questions.

MS. PSAKI: The first question will be from Margaret Brennan of CBS News. Oh, right – other side.

QUESTION: Geez, wow. Thank you very much. (Laughter.) Mr. Secretary, two questions for you. NATO says there are no signs of a Russian pullback. What is it going to take for this body to have a greater show of force? Because there do seem some members wary of antagonizing Russia.

And on Mideast peace, where are we in this process, with President Abbas saying he’s canceled this meeting with you? Is this brinksmanship? And has the U.S. offered the release of Jonathan Pollard?

SECRETARY KERRY: Well, that’s about three questions or four, I think. But I’m happy to answer them. With respect to NATO and the presence of force and what is it going to take, I think everybody here today made it clear that the preference of NATO and the preference of all of us is to see a de-escalation, to find a diplomatic route in order to be able to work, hopefully, ultimately, together to strengthen the possibilities of Ukrainians making their own choices about Ukraine in the future. That’s the goal.

And at the same time, it is important for everybody in the world to understand that the NATO alliance takes seriously this attempt to change borders by use of force. So that is the wakeup call. And as a result, people here today made a commitment to be able to strengthen visibly, as a matter of deterrence and as a matter of reality, the cooperation, the deployment, and the efforts of those who are members of this alliance.

Now, with respect to the de-escalation, we were happy that yesterday Russia made an announcement, President Putin made the announcement initially, that they were going to move a battalion back. And that’s obviously small compared to the numbers that are deployed, but it is a welcome gesture in the right direction. The question now is: Is there a way to build on that in order to be able to find a way to move the masses of troops back and truly deescalate?

So I think there’s a delicate balance, and we’re engaged in efforts with lots of different people engaged in this effort to see if there is a way forward. That’s a lot of the discussion here today – it’ll be some of the discussion at the dinner tonight – is to help map that road forward.

With respect to the Middle East peace process, I’ve heard a rumor about, a quote not being invited sort of, but I’m not sure I’m going, regardless of that, whether or not we have certain things that we’re trying to figure out in terms of the logistics on the ground and what is possible.

What is important to say about the Middle East right now is it is completely premature tonight to draw any kind of judgment, certainly any final judgment, about today’s events and where things are. This is a moment to be really clear-eyed and sober about this process. It is difficult, it is emotional, it requires huge decisions, some of them with great political difficulty, all of which need to come together simultaneously.

And all I can tell you is that we are continuing, even now as I am standing up here speaking, to be engaged with both parties to find the best way forward. We’ve been in touch with the White House and Washington during the day, as well as all of the parties. And I’ve talked to many people on the ground in the region, and I will continue to even tonight.

So my team is on the ground meeting with the parties even tonight. And we urge both sides to show restraint while we work with them. Obviously, it’s moments like this when we all need to remember exactly what brought us to this effort in the first place, what the goal is, and where everybody wants to end up. And tonight I haven’t heard yet what the public response of Israel has been, but I know that President Abbas in his comments made it clear that he intends to continue to work, even tonight, on this process that we are engaged in.

So we will see where we wind up at the end of the evening in the next days, but it is, as I said at the outset of my remarks, completely premature to draw any judgments about this at this point in time. And at this point in time, no agreement has been reached with respect to any prisoner, not even the ones that, at this moment, are at issue in terms of the transfer. The cabinet in Israel has to vote; I’m not sure exactly when that might take place or not. And so there is no agreement at this point in time regarding anyone or any specific steps. There are a lot of different possibilities in play.

MS. PSAKI: The next question will be from Lesley Wroughton of Reuters.

QUESTION: Mr. Secretary, I just wanted to be clear because there’s a lot of reports going around. We also understand from a U.S. official that you’re not traveling tomorrow to Ramallah. But also if it is true – I mean, I’ve looked at the transcript and President Abbas has signed those conventions to join these 15 agencies – is this in your mind a breach of the understanding of the process that you launched eight, nine months ago?

On the other hand, do you – how do you see the way going forward? If this is – the way that President Abbas explained it was that the Israelis did not release those prisoners; that was the agreement. He agreed he wouldn’t go to the UN until the end of April, and he’s going – he’s going to go now. So there seems to be a lot of disappointment.

SECRETARY KERRY: No, he’s not. He is not. Let me make it absolutely clear: None of the agencies that President Abbas signed tonight involve the UN. None of them. And President Abbas has given his word to me that he will keep his agreement and that he intends to negotiate through the end of the month of April.

Now obviously, the prisoners were due on the 29th, which was Saturday. I’m not going to get into the who, why, what, when, where, how of why we’re where we are today. We’re where we are today – and the important thing is to keep the process moving and find a way to see whether the parties are prepared to move forward. In the end, this is up to the parties.

I mean, I want to make this crystal clear: The United States is proud and ready and willing to be a facilitator in this process. But the leaders on both sides have to make the decisions, not us. It’s up to them to decide what they’re prepared to do with each other, for each other, for the future, for the region, for peace. And we will do everything in our power. President Obama has been as committed to this as anybody. He has committed his personal time. He has committed my time. The President is desirous of trying to see how we can make our best efforts in order to find a way to facilitate. But facilitation is only as good as the willingness of leaders to actually make decisions when they’re put in front of them.

And we’re going to continue to do our work. We’re going to continue because this matters – matters to the region, matters to the parties, matters to us, matters to the world. Everywhere I go, people ask me: Is there any progress? Can you get anywhere? Can you move? The one thing that I keep in the center of my mind is that, even tonight, both parties say they want to continue to try to find a way forward. And so we will continue to work with them in order to try to do that.

MS. PSAKI: Thank you, everyone.

SECRETARY KERRY: Thank you, everyone.

SHADOWY FIGURE ON THE MARTIAN SLOPES

FROM:  NASA
Shadow Portrait of NASA Rover Opportunity on Martian Slope

NASA's Mars Exploration Rover Opportunity caught its own silhouette in this late-afternoon image taken by the rover's rear hazard avoidance camera. This camera is mounted low on the rover and has a wide-angle lens.

The image was taken looking eastward shortly before sunset on the 3,609th Martian day, or sol, of Opportunity's work on Mars (March 20, 2014). The rover's shadow falls across a slope called the McClure-Beverlin Escarpment on the western rim of Endeavour Crater, where Opportunity is investigating rock layers for evidence about ancient environments.  The scene includes a glimpse into the distance across the 14-mile-wide (22-kilometer-wide) crater.
Image Credit-NASA-JPL-Caltech

RECENT U.S. DEFENSE DEPARTMENT PHOTOS FROM AFGHANISTAN

FROM:  U.S. DEFENSE DEPARTMENT 
An Afghan army commando bounds toward a compound after taking enemy fire during a clearing operation in the Khogyani district of Afghanistan's Nangarhar province, March 20, 2014. U.S. Army photo by Spc. Connor Mendez.

The sun rises off the tail of an AH-64E Apache Guardian helicopter as U.S. soldiers slowly guide it off the ramp of an U.S. Air Force C-17 Globemaster III cargo aircraft on Kandahar Airfield, Afghanistan, March 17, 2014. U.S. Army photo by Capt. Andrew Cochran.

U.S. DEFENSE DEPARTMENT CONTRACTS FOR APRIL 1, 2014

U.S. DEFENSE DEPARTMENT 
CONTRACTS
AIR FORCE

The Boeing Co., St. Louis, Mo., has been awarded a maximum $80,000,000 indefinite-delivery/indefinite-quantity contract, for Joint Direct Attack Munitions technical support for studies and analysis, product improvement, upgrades, integration (including, but not limited to, software integration, aircraft integration, and associated hardware) and testing. Work will be performed in Missouri with an expected completion date of March 31, 2019. Fiscal 2014 Air Force procurement funds in the amount of $4,141,039 and fiscal 2014 Navy operations and maintenance funds in amount $145,000 will be obligated at time of award. This award is the result of a sole source acquisition. Air Force Life Cycle Management Center/EBDK, Eglin Air Force Base, Fla., is the contracting activity (FA8681-14-D-0028).

DEFENSE LOGISTICS AGENCY
Petroleum Traders Corp.,* Fort Wayne, Ind., has been awarded a maximum $66,882,605 fixed-price with economic-price-adjustment contract for fuel. This is a competitive acquisition, and 34 offers were received. This is a three-year base contract with no option periods. Location of performance is Indiana with an April 30, 2017 performance completion date. Using military services are Army, Navy, Air Force, and federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Va., (SP0600-14-D-8509).
Dennis K. Burke Inc.,** Chelsea, Mass., has been awarded a maximum $65,282,707 fixed-price with economic-price-adjustment contract for fuel. This is a competitive acquisition, and 34 offers were received. This is a three-year base contract with no option periods. Locations of performance are Massachusetts, Maine, New Hampshire, New York, Rhode Island, and Connecticut with a March 31, 2017 performance completion date. Using military services are Army, Navy, Air Force, Air National Guard, and federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Va., (SP0600-14-D-8521).

Allied Tube & Conduit, Harvey, Ill., (SPE8E6-14-D-0002); Cobra Systems,** Bloomington, N.Y., (SPE8E6-14-D-0003); Iris Kim,** Hampton, Va., (SPE8E6-14-D-0004), have been awarded a maximum $41,000,000 fixed-price with economic-price-adjustment, indefinite-quantity contract for concertina barbed tape. This is a two-year base contract with three one-year option periods. This contract is a competitive acquisition, and five offers were received. Locations of performance are Illinois, New York, and Virginia with an April 1, 2019 performance completion date. Using military services are Army, Navy, Air Force, Marine Corps, and Defense Logistics Agency. Type of appropriation is fiscal 2014 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pa.

Global Montello Group,** Waltham, Mass., has been awarded a maximum $36,202,002 fixed-price with economic-price-adjustment contract for fuel. This is a competitive acquisition, and 34 offers were received. This is a three-year base contract with no option periods. Location of performance is Massachusetts with a March 31, 2017 performance completion date. Using military services are Army, Navy, Air Force, and federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Va., (SP0600-14-D-8533).
Sprague Operating Resources LLC,** White Plains, N.Y., has been awarded a maximum $34,898,134 fixed-price with economic-price-adjustment contract for fuel. This is a competitive acquisition, and 34 offers were received. This is a three-year base contract with no option periods. Locations of performance are New York, Pennsylvania, New Jersey, and Maine with a March 31, 2017 performance completion date. Using military services are Army, Navy, Air Force, Marine Corps, and federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Va., (SP0600-14-D-8528).
Air Liquide Industrial US LP, Houston, Texas, has been awarded a maximum $25,310,221 firm-fixed-price contract for gaseous nitrogen. This is a competitive acquisition, and one offer was received. This is a five-year base contract with no option periods. Locations of performance are Texas and California with an April 30, 2019 performance completion date. Using services are federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2019 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, San Antonio, Texas, (SPE601-14-D-1516).

Brasseler USA,** Savannah, Ga., has been awarded a maximum $22,335,309 modification (P00003) exercising the second option period on a one-year base contract (SPM2DE-12-D-7458) with four one-year option periods for distribution of general dental supplies. This is a fixed-price with economic-price adjustment, indefinite-delivery/indefinite-quantity contract. Location of performance is Georgia with an April 8, 2015 performance completion date. Using military services are Army, Navy, Air Force, Marine Corps, and federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2015 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pa.

Indigo Energy Partners LLC,** Alpharetta, Ga., has been awarded a maximum $20,745,146 fixed-price with economic-price-adjustment contract for fuel. This is a competitive acquisition, and 34 offers were received. This is a three-year base contract with no option periods. Locations of performance are Georgia and Pennsylvania with a March 31, 2017 performance completion date. Using military services are Army, Navy, Air Force, Air National Guard, and federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Va., (SP0600-14-D-8526).

Naughton Energy Corp.,** Pocono Pines, Pa., has been awarded a maximum $18,217,525 fixed-price with economic-price-adjustment contract for fuel. This is a competitive acquisition, and thirty-four offers were received. This is a three-year base contract with no option periods. Locations of performance are Pennsylvania and New York with an April 30, 2017 performance completion date. Using military services are Army, Navy, Air Force, and federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Va., (SP0600-14-D-0238).

Mansfield Oil Co.,** Gainesville, Ga., has been awarded a maximum $14,541,401 fixed-price with economic-price-adjustment contract for fuel. This is a competitive acquisition, and 34 offers were received. This is a three-year base contract with no option periods. Location of performance is Georgia with a March 31, 2017 performance completion date. Using military services are Army, Navy, Air Force, and federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Va., (SP0600-14-D-8530).
Riggins Oil,** Vineland, N.J., has been awarded a maximum $9,735,913 fixed-price with economic-price-adjustment contract for fuel. This is a competitive acquisition, and 34 offers were received. This is a three-year base contract with no option periods. Locations of performance are New Jersey and Pennsylvania with a March 31, 2017 performance completion date. Using military services are Army, Navy, Air Force, and federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Va., (SP0600-14-D-8531).

Talley Petroleum Enterprises Inc.,** Grantville, Pa., has been awarded a maximum $9,504,864 fixed-price with economic-price-adjustment contract for fuel. This is a competitive acquisition, and thirty-four offers were received. This is a three-year base contract with no option periods. Location of performance is Pennsylvania with a March 31, 2017 performance completion date. Using military services are Army, Navy, Air Force, Air National Guard, and federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Va.; (SP0600-14-D-8527).

Foster Fuels Inc.,** Brookneal, Va., has been awarded a maximum $8,268,245 fixed-price with economic-price-adjustment contract for fuel. This is a competitive acquisition, and 34 offers were received. This is a three-year base contract with no option periods. Locations of performance are Virginia, Maine, Massachusetts, New Hampshire, New York, Pennsylvania, and Vermont with an April 30, 2017 performance completion date. Using military services are Army, Navy, Air Force, and federal civilian agencies. Type of appropriation is fiscal 2014 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Va., (SP0600-14-D-8505).

NAVY
URS Federal Inc., Germantown, Md. (N00189-12-D-Z016); Raytheon Technical Services Co. LLC, Sterling, Va. (N00189-12-D-Z017); Technical Software Services Inc.,* Pensacola, Fla. (N00189-12-D-Z018); Camber Corp., Huntsville, Ala. (N00189-12-D-Z019); General Dynamics Information Technology, Fairfax, Va. (N00189-12-D-Z020); Northrop Grumman Corp., Herndon, Va. (N00189-12-D-Z021); Logistic Services International Inc., Jacksonville, Fla. (N00189-12-D-Z022); Sonalysts Inc., Waterford, Conn. (N00189-12-D-Z023); and Kratos Defense and Security Solutions, San Diego, Calif. (N00189-12-D-Z024), are being awarded modifications under previously awarded multiple award contracts to exercise option two of the contracts pursuant to contract clause FAR 52.217-9, option to extend the term of the contract. The contracts provide education training products and services for the Naval Education Training Command in conjunction with Naval Education Training and Professional Development and Technology Center which works to educate Navy sailors in a variety of ways. The maximum contract value, for option two, for all nine contracts combined, is $33,079,710. These nine contractors will compete for task orders under the terms and conditions of the awarded contracts. No funding will be obligated with the exercise of the option, and therefore none of the funding will expire before the end of the current fiscal year. Funding will be provided on individual task orders issued against the contracts during the period of the option. Work will be performed in Pensacola, Fla. (90 percent) and the other 10 percent will be performed at the contractors' locations. Work is expected to be completed April 30, 2015. The NAVSUP Fleet Logistics Center Norfolk, Contracting Department, Philadelphia Office, Philadelphia, Pa., is the contracting activity.

Lockheed Martin Space Systems Co., Sunnyvale, Calif., is being awarded a $21,319,984 cost-plus-fixed-fee, level of effort, completion type contract to provide the United Kingdom (UK) with engineering and technical support services and deliverable materials for the UK Trident II Missile System. This contract provides for, but is not limited to, technical planning, direction, coordination, and control to assure that UK fleet ballistic missile program requirements are identified and integrated to support planned milestone schedules and emergent requirements, re-entry systems UK resident technical support, operational support hardware, and UK-unique common missile compartment/UK successor support. Work will be performed in Sunnyvale, Calif. (76.4 percent); Cape Canaveral, Fla. (12.5 percent); Coulport, Scotland. (4.4 percent); Aldermaston, England (3.3 percent); St. Mary’s, Ga. (2 percent); Silverdale, Wash. (less than 1 percent), Campbell, Calif. (less than 1 percent), Denver, Colo. (less than 1 percent), other U.S. cities (less than 1 percent); and Italy (various cities) (less than 1 percent), with an expected level-of-effort completion date of March 31, 2015 and deliverable items completion date of June 30, 2016. United Kingdom contract funds are being obligated in the amount of $21,319,984. Contract funds will not expire at the end of the current fiscal year. This contract was a sole-source acquisition pursuant to 10 U.S.C. 2304(c)(4). The Department of the Navy, Strategic Systems Programs Office, is the contracting activity (N00030-14-C-0028).

Progeny Systems Corp.,** Manassas, Va., is being awarded a $9,589,064 cost-plus-fixed-fee contract for engineering and technical services in support of the Navy’s AN/UYQ-100 Undersea Warfare Decision Support System. This contract includes options which, if exercised, would bring the cumulative value of this contract to $55,567,452. Work will be performed in Manassas, Va. (67 percent); Patuxent River, Md. (12 percent); Gig Harbor, Wash. (7 percent); Middletown, R.I. (6 percent); Norfolk, Va. (4 percent); and Pearl Harbor, Hawaii (4 percent), and is expected to be completed by March 2015. Fiscal 2013 and 2014 research, development, test and evaluation; fiscal 2014 other procurement, Navy and fiscal 2014 operations and maintenance, Navy funding in the amount of $6,877,411 will be obligated at time of award. Contract funds in the amount of $183,000 will expire at the end of the current fiscal year. This contract was not competitively procured in accordance with the Federal Acquisition Regulation 6.302-5. This contract is being awarded as a Phase III Small Business Innovative Research effort, under the Small Business Innovative Development Act of 1982. The Naval Sea Systems Command, Washington, D.C., is the contracting activity (N00024-14-C-5209).

Hamilton Sundstrand Corp., Rockford, Ill., is being awarded $7,354,035 for firm-fixed-price delivery order 7006 under a previously awarded contract (N00383-12-D-011N) for repair of the V-22 Osprey aircraft constant frequency generator. Work will be performed in Rockville, Ill., and is expected to be completed in September 2016. Fiscal 2014 Navy working capital funds in the amount of $7,554,035 will be obligated at time of award, none of which will expire at the end of the current fiscal year. The Naval Supply Systems Command Weapon Systems Support, Philadelphia, Pa., is the contracting activity.

ARMY
Alessi Keyes Construction, North Little Rock, Ark. (W912JF-14-D-0001); AMR Construction LLC, Little Rock, Ark. (W912JF-14-D-0002); Oren Atchley Co., Inc., Fort Smith, Ark. (W912JF-14-D-0003); BES Design/Build LLC, Fairhope, Ala. (W912JF-14-D-0004); Beshears Construction Inc., Fort Smith, Ark. (W912JF-14-D-0005); C&M Contractors Inc., Doniphan, Mo. (W912JF-14-D-0006); Charpie Construction Co., Inc., Hopkinsville, Ky. (W912JF-14-D-0007); CWR Construction Inc., North Little Rock, Ark. (W912JF-14-D-0008); DAV Construction Co., Sherwood, Ark. (W912JF-14-D-0009); Flynco Inc., Little Rock, Ark. (W912JF-14-D-0010); Haralson Property Resources LLC, Memphis, Tenn. (W912JF-14-D-0011); Hernandez Consulting LLC, New Orleans, La. (W912JF-14-D-0012); HGL Construction, Midwest City, Okla. (W912JF-14-D-0013); Hollon Contracting LLC, Dothan, Ala. (W912JF-14-D-0014); J&S Construction Company Inc., Cookeville, Tenn. (W912JF-14-D-0015); Jack Helms Construction Co., Fort Smith, Ark. (W912JF-14-D-0016); Jack Morgan Construction, England, Ark. (W912JF-14-D-0017); Jane Construction LLC, Ozark, Ark. (W912JF-14-D-0018); K&E Construction Inc., South Beebe, Ark. (W912JF-14-D-0019); LJB Construction Inc., Rogers, Ark. (W912JF-14-D-0020); Lobina Construction, Hot Springs, Ark. (W912JF-14-D-0021); McCormick Asphalt Paving & Excavation, Ozark, Ark. (W912JF-14-D-0022); Precise Concrete Works LLC, Memphis, Tenn. (W912JF-14-D-0023); Primestar Construction Corp., Dallas, Texas (W912JF-14-D-0024); RHI Inc., West Haven, Utah (W912JF-14-D-0025); Roederer Construction Inc., LaGrange, Ky. (W912JF-14-D-0026); Ross Sparks Builders, Little Rock, Ark. (W912JF-14-D-0027); Structural Systems Inc., Fort Smith, Ark. (W912JF-14-D-0028); Wilkins Construction, North Little Rock, Ark. (W912JF-14-D-0029), were awarded a $20,000,000 firm-fixed-price indefinite-
delivery/indefinite-quantity contract for the sustainment/repair and maintenance of National Guard military construction projects at Little Rock Air Force Base, Camp Joseph T. Robinson, and Fort Smith Regional Airport. Funding and work location will be determined with each order. Estimated completion date is March 31, 2019. Bids were solicited via the Internet with 29 received. All contractors in this announcement are small businesses. National Guard Bureau, North Little Rock, Ark., is the contracting activity.

Tower Industries Inc., Greenville, Wis., was awarded a $6,598,704 modification (P00013) to contract W52P1J-12-C-0051 to acquire 500-pound practice bombs. Fiscal 2014 other procurement, Army funds in the amount of $7,258,574 were obligated at the time of the award. Estimated completion date is Dec. 30, 2015. Work will be performed in Greenville, Wis. Army Contracting Command, Rock Island Arsenal, Ill., is the contracting activity.

WASHINGTON HEADQUARTERS SERVICES
SAIC/LEIDOS Inc, Reston, Va., is being awarded a $9,499,534 modification (P00019) to firm-fixed-price contract (HQ0034-11-A-0013-0001) for professional engineering services to support the warfare area of developmental, test and evaluation. Work will be performed in Reston, Va. The expected completion date is March 31, 2015. Fiscal 2014 research and development funds are being obligated on this award and will expire at the end of the current fiscal year. This contract was competitively procured via Federal Business
Opportunities with seven proposals received. Washington Headquaters Services, Arlington, Va., is the contracting activity.

Logistics Management Institute, McLean, Va., is being awarded a $7,031,240 modification (P00037) to firm-fixed-price contract (HQ0034-10-F-0075) for technical support to Defense Procurement and Acquisition Policy. Work will be performed in Arlington, Falls Church and Alexandria, Va. The expected completion date is Feb. 28, 2015. Fiscal 2014 operations and maintenance funds are being obligated on this award and will expire at the end of the current fiscal year. This contract was competitively procured, with two proposals received. Washington Headquarters Services, Arlington, Va., is the contracting activity.
*Veteran Owned Small Business

**Small Business

NASA SATELLITE VIEWS TROPICAL CYCLONE HELLEN OVER MADAGASCAR

When NASA's Aqua satellite passed over Madagascar on March 31 at 10:47 UTC/6:47 a.m. EDT it showed powerful thunderstorms circling the center of Hellen (purple).

Image Credit: NASA/JPL, Ed Olsen

Hellen (Southern Indian Ocean)

FROM:  NASA 

Tropical Cyclone Hellen Makes Landfall in Madagascar

Tropical Cyclone Hellen made landfall in west central Madagascar as NASA's Aqua satellite passed overhead capturing temperature data on its towering thunderstorms.

When NASA's Aqua satellite passed over Madagascar on March 31 at 10:47 UTC/6:47 a.m. EDT and the Atmospheric Infrared Sounder or AIRS instrument aboard captured infrared data on Hellen. AIRS data showed powerful thunderstorms circling the center of circulation with cloud top temperatures in excess of -63F/-52C indicating they were high into the troposphere.
Thunderstorms reaching those heights also have the potential for heavy rainfall
Hellen developed during the week of March 23 in the Mozambique Channel, the body of water that lies between the island nation of Madagascar and Mozambique on the African mainland. By March 26, at 20:00 UTC/4 p.m. EDT, the tropical low, then known as System 95S was centered near 10.7 south latitude and 39.4 east longitude. The low level center was actually over land just inland from the coast, and sitting over the Tanzania and Mozambique border.

It was on March 26, that the Joint Typhoon Warning Center or JTWC noted that the low had a high chance for becoming a tropical depression in the next 24 hours.  JTWC noted that enhanced infrared satellite imagery on March 26 revealed that the low-level circulation center has consolidated and there were bands of thunderstorms wrapping into it. JTWC estimated that maximum sustained winds are between 25 to 30 knots/ 28.7 to 34.5 mph/46.3 to 55.5 kph.

At that time, the tropical low was in an area that had low vertical wind shear and warm sea surface temperatures that forecasters at JTWC said would provide the fuel for thunderstorms to develop and assist the low's growth. Over the next several days, System 95S moved east and back into the Mozambique Channel where it rapidly intensified into Tropical Cyclone Hellen and reached Category IV status on the Saffir-Simpson Scale when maximum sustained winds peaked near 140 knots/161.1 mph/259.3 kph.

By March 31 at 1500 UTC/11 a.m. EDT, Hellen's maximum sustained winds dropped to 85 knots/97.8 mph/ 157.4 kph because of the interaction with Madagascar. It was centered near 16.2 south latitude and 45.9 east longitude, about 180 nautical miles/207.1 miles/333.4 km north-northwest of Antananarivo, Madagascar.

The NOAA-19 satellite showed that the bulk of strongest thunderstorms were south of the center as a result of wind shear. In addition there is dry air moving into the center of circulation which is also helping to weaken Hellen.
Hellen was moving slowly to the south-southeast at 5 knots/5.7 mph/9.2 kph, and the JWTC expects it to curve to the southwest and re-enter the Mozambique Channel.

Text credit:  Rob Gutro
NASA's Goddard Space Flight Center

DEFENSE SECRETARY HAGEL THANKS PORTUGAL FOR SUPPORTING NATO'S BALTIC AIR POLICING

U.S. Defense Secretary Chuck Hagel, center left, meets with Portuguese Defense Minister Jose Pedro Aguiar-Branco, center right, at the Pentagon, March 31, 2014. The two leaders met to discuss defense-related topics. DOD photo by Glenn Fawcett  

 FROM:  U.S. DEFENSE DEPARTMENT
Defense Secretary Welcomes Portuguese Minister to Pentagon
American Forces Press Service

WASHINGTON, March 31, 2014 – Defense Secretary Chuck Hagel today welcomed Portuguese Minister of Defense Jose Pedro Aguiar-Branco to the Pentagon, and expressed to the minister his appreciation for Portugal’s many contributions to international security, Pentagon Press Secretary Navy Rear Adm. John Kirby said in a Defense Department news release.

The secretary specifically thanked Portugal for supporting NATO’s Baltic Air Policing rotation later this year, and Portugal’s support in combating piracy and maritime crime in the Gulf of Aden and off Somalia, Kirby said in the release.
Kirby said Hagel also thanked Aguiar-Branco for Portugal’s hospitality towards U.S. airmen at Lajes Field.

The two leaders “discussed the situation in Ukraine and reaffirmed both nations’ steadfast commitment to our collective defense obligations,” Kirby said.
Both men, he said, agreed on the need for Russia to begin discussions with the Ukrainian government, as diplomacy remains the only acceptable means of resolving this crisis.

“Secretary Hagel looks forward to seeing Minister Aguiar-Branco at the NATO Summit in Wales, this September,” Kirby said in the release.

TWO MEN, COMPANIES ORDERED TO PAY OVER $3.3 MILLION RESTITUTION FOR ROLES IN ILLEGAL PRECIOUS METALS TRANSACTIONS

FROM:   COMMODITY FUTURES TRADING COMMISSION  
Federal Court Orders Two Florida Men and Their Companies to Pay More than $3.3 Million in Restitution and Penalties to Settle Charges Stemming from Role in Illegal, Off-Exchange Precious Metals Transactions

The CFTC Sued John King and Newbridge Alliance, Inc., and David A. Moore and United States Capital Trust, LLC, in Scheme Orchestrated by Hunter Wise Commodities, LLC

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced that on February 26, 2014, Judge Donald M. Middlebrooks of the U.S. District Court for the Southern District of Florida in Miami entered permanent injunction Orders against Florida residents John King and his company Newbridge Alliance, Inc. (Newbridge), and David A. Moore and his company United States Capital Trust, LLC (USCT), who the CFTC sued for their role in a multi-million dollar precious metals scheme orchestrated by Hunter Wise Commodities, LLC and related companies (Hunter Wise) (see related press release 6447-12 and Complaint.)

The Orders require King and Newbridge jointly to pay $750,515 in restitution to their customers and a $1.5 million civil monetary penalty, and Moore and USCT jointly to pay $380,664 in restitution and a $750,000 civil monetary penalty, respectively. The Orders also impose permanent solicitation, trading and registration bans against King, Newbridge, Moore, and USCT, and prohibit them from further violations of the Commodity Exchange Act (CEA) and CFTC regulations, as charged.

The Orders specify that the restitution payments are to be made to Melanie Damian, a court-appointed Special Monitor and Corporate Manager, in the name “Hunter Wise Settlement/Restitution Fund.” The Orders also impose permanent solicitation, trading and registration bans against King, Newbridge, Moore, and USCT, and prohibit them from further violations of the Commodity Exchange Act (CEA) and CFTC regulations, as charged.

The Orders find that from at least July 16, 2011 until February 25, 2013, Newbridge and USCT operated under the ownership and control of King and Moore respectively. Both Newbridge and USCT solicited retail customers to buy physical metals, such as gold, silver, platinum, palladium and copper, and then executed those transactions through Lloyds Commodities and Hunter Wise (see related press releases 6850-14 and 6522-13 and Orders).

According to the Orders, both Newbridge and USCT represented that customers could purchase physical metals for a small down payment (usually 25 percent) and finance the remainder of the purchase with a loan. Newbridge and USCT represented that physical metals were stored in “independent banks” or “federally regulated depositories.” In fact, these representations were false because neither Newbridge nor USCT possessed or had title to any physical metals. Additionally, according to the Orders, both Newbridge and USCT failed to disclose that the overwhelming majority of their customers lost money in connection with these transactions. As a result, Newbridge received over $750,000 in commissions and fees from retail customers, and USCT received over $380,000 in commissions and fees from retail customers, and the Orders require payment of those funds as restitution to customers.

Further, the Orders find that the transactions offered and entered into by Newbridge and USCT were not executed on a board of trade and were therefore illegal.

The CFTC’s litigation continues against Hunter Wise and its principals. The court issued an Order on February 19, 2014, finding that Hunter Wise had no actual metal to deliver to customers, and the Court held a trial on all remaining issues between February 26 and March 4, 2014. No ruling has been entered as of the date of this press release.

The CFTC appreciates the assistance of the Florida Office of Financial Regulation.

The CFTC Division of Enforcement staff members responsible for this case are Carlin Metzger, Heather Johnson, Brigitte Weyls, Jeff Le Riche, Peter Riggs, Thaddeus Glotfelty, Joseph Konizeski, Scott Williamson, Rosemary Hollinger, and Richard B. Wagner.

SEC CHAIR WHITE'S SPEECH ON ALL-ENCOMPASSING ENFORCEMENT TO POLICE MARKETS

FROM:  SECURITIES AND EXCHANGE COMMISSION 
All-Encompassing Enforcement: The Robust Use of Civil and Criminal Actions to Police the Markets
 Chair Mary Jo White
March 31, 2014

Introduction
Thank you, David Prince, for that kind introduction.  I have participated in this event for many years and have always considered this conference to be all about the compliance and legal issues that are most important to the integrity of our securities markets.  Now, as Chair of the SEC, I would like to thank you for the work you do day in and day out to protect investors and keep our markets robust and safe.

In about a week, I will have completed my first year at the SEC.  It has been quite a year.  We have made very good progress in accomplishing the initial goals I set to achieve significant traction on our rulemaking agenda arising from the Dodd Frank and JOBS Acts, intensify our review of the structure of our equity markets, and enhance our already strong enforcement program.

All-Encompassing Enforcement
Today, I thought I would talk about the SEC’s Enforcement program, and in particular, the importance of all-encompassing enforcement of the securities laws.  By that, I mean the appropriate, but vigorous, use of criminal, civil, and regulatory tools to enforce the securities laws.  Before I begin, let me assure Preet Bharara, one of my very distinguished successors as United States Attorney, that Congress did not give the SEC criminal authority as we were flying in last night.  And, although I often emphasize how essential our examination function is to achieving comprehensive compliance with all of the regulatory requirements, today’s focus will be the SEC’s enforcement function—investigating and bringing cases.

So why am I, the Chair of the SEC, talking about civil and criminal enforcement?  It is because I know, from both my years as United States Attorney working alongside the SEC and now from inside the SEC, that the SEC’s expertise and extensive cooperation and partnership with the criminal authorities is essential to all-encompassing enforcement of the federal securities laws.  So, too, are the much greater number and variety of standalone cases the SEC brings for violations that are not prosecuted criminally.

There are, of course, no more powerful tools than a criminal conviction and the prospect—and reality—of imprisonment.  When they are added to the wider range of actions the SEC brings and the unique remedies available to us, law enforcement can best fulfill its collective obligation to investigate, charge, and address the full range of securities law violations.  And my message today is that a robust combination of criminal and regulatory enforcement of the securities laws is not only appropriate, but also critical to deterring securities violators, punishing misconduct, and protecting investors.

All-Encompassing Enforcement on the Rise
As you undoubtedly know, essentially any violation of the federal securities laws and regulations can be a criminal violation if done willfully, that is, with intent to violate the law.[1]  This means that many of the SEC’s investigations can give rise to criminal cases, although obviously not every one of our cases that could be prosecuted criminally is.  But, in the last 20 years, there has been a significant rise in criminal prosecutions of securities cases.

A couple of statistics make the point.  When I became U.S. Attorney in 1993, there were 67 criminal cases that were related to SEC proceedings.[2]  That number now has doubled.[3]  And the number of instances where we grant access to our files to other law enforcement authorities—a rough proxy for the number of cases where we have parallel investigations—has also more than doubled.[4]

And there is more to the story than the numbers.  We now coordinate our efforts with the criminal authorities on many types of securities law offenses that did not garner much, if any, criminal attention in the past.  Insider trading has, of course, been the subject of criminal cases for many years, as have offering frauds and Ponzi schemes.  But accounting fraud prosecutions were relatively rare before Enron, WorldCom, and Adelphia.  More recently, our parallel efforts have also yielded a significant increase in criminal actions in the FCPA space and in other areas, including actions against investment advisers for false valuations, overcharging, and hiding fees.  Although the SEC is certainly not the source of or involved in every securities fraud prosecution, my sense is that many criminal authorities across the country are more willing and better able to pursue these prosecutions because the SEC devotes significant resources to uncovering and building these complex cases, and then working in parallel with the prosecutors to bring our respective cases.

Benefits of a Strong Partnership
In the vast majority of criminal securities fraud prosecutions, the SEC’s Enforcement staff works closely with the criminal authorities, whether it be DOJ, the FBI, or state and local law enforcement.  These parallel investigations are entirely appropriate under the law, as long as we conduct our investigations, as we do, independently, but in cooperation with the criminal authorities.[5]  Criminal investigations unquestionably bring great value—search warrants, wiretaps, and undercover operations are not in the SEC’s toolbox.

In many of these cases, it is the lawyers, accountants, and other professionals from the SEC’s enforcement and exam programs who initially detect the misconduct and put the preliminary case together.  Every day, our staff sorts through dozens of tips, complaints, and whistleblower submissions, pursues leads derived from our exam program and SRO referrals, and analyzes large volumes of transactional data generated from our risk analytic initiatives.  Many of these sources lead to investigations that we pursue.

When we find sufficient evidence of a serious violation to justify criminal involvement, we alert the criminal authorities, and we may conduct parallel investigations.  The criminal authorities will sometimes decide to conduct undercover investigative operations, while we take the lead in documentary review and analysis of records.  As many of you here know, we also often interview witnesses together.

When we work together and bring parallel actions, we will typically file our actions on the same day, unless there is some investigative reason for one of us to act first, such as a need for an emergency asset freeze or to stop a flight risk.  Often, you will see that the SEC action names additional defendants who are not part of the criminal case, including those who did not necessarily act with intent to advance the scheme, such as the gatekeeper who permitted the scheme to proceed[6] or the supervisor who failed to appropriately supervise the wrongdoers. [7]  We charge these additional defendants because it is very important to proceed broadly against other participants in a scheme to ensure that they too are called to account.

Importance of Standalone SEC Actions
The SEC’s partnership with the criminal authorities in parallel cases represents a very important component of our enforcement program, but most of our cases are standalone, as we operate independently under a broad 80-year old statutory mandate to enforce the federal securities laws.  We, for example, often bring cases based on negligence, while most criminal statutes require intent or at least willful blindness.  Some of our statutes are also strict liability, which do not require intent, recklessness, or negligence.  And because of the higher, beyond a reasonable doubt evidentiary standard in criminal cases, the SEC has more flexibility to bring important cases that send a strong message of deterrence when the evidence may not be enough for a criminal case.

In our standalone cases, we also have unique remedies to protect investors, beyond disgorgement of ill-gotten gains and civil monetary penalties.  One of the SEC’s most effective tools is our ability to bar wrongdoers from their particular roles in the securities profession, and, thanks to the Dodd-Frank Act, from the entire securities industry.[8]  So whether it is the broker who charged hidden commissions, or the investment adviser who misused investor funds, we can ensure they are not in a position to abuse the trust of investors again.  We can also seek orders barring the officer of a public company who committed accounting fraud from serving as an officer or director of any public company, and prevent the microcap promoter from being involved in penny stocks.  We also have the authority to prohibit certain professionals who engaged in misconduct from appearing or practicing before the SEC—an accountant can be prohibited from signing an audit report for a public company and an attorney can be prohibited from advising on documents that will be filed with the Commission.[9]

The SEC also has the authority to obtain asset freezes, trading suspensions, and temporary injunctions to stop fraud in its tracks before illicit profits are dissipated or the fraudsters can complete their schemes.  Finally, through our Fair Fund authority, we are able to distribute money recovered through disgorgement and penalties back to harmed investors.

Although standalone criminal prosecutions and parallel actions send important messages of deterrence, our ability, in civil standalone actions, to broadly punish wrongdoing also sends an important and additive message to the market on appropriate standards of conduct.  My strong sense, from all of the different vantage points I have occupied, is that the SEC’s cases are closely watched by industry participants, as well as those in this room who represent them.  As a result of that dynamic, compliance programs are enhanced, training is intensified and behavior changes.  Our efforts thus have a multiplier effect by having meaningful impact on market participants who are not involved in the particular misconduct that has been charged.

All-Encompassing Enforcement in Practice
So how does this all fit together in practice?  I will briefly talk about just three areas—insider trading, microcap fraud, and financial fraud.  Obviously, there are others, such as FCPA and investment adviser fraud, where the same takeaways apply.

Insider Trading

Unlawful insider trading always receives significant enforcement attention and has historically been a staple for both the SEC and criminal prosecutors.  In the last five years,  Preet and his team in the Southern District of New York have done a tremendous job bringing cases against over 75 defendants who have all either pled guilty or been convicted after trial.  This remarkable record and the sheer number of criminal cases send an unmistakable message of strong deterrence.

The SEC’s record in insider trading cases, while not perfect, is also very impressive.  Over the last five years, we have charged over 570 defendants in civil insider trading cases, the vast majority of which have been successfully concluded either through settlement or a finding of liability after trial.

Behind the headlines is the important story of how many of these cases originated and how they are made.  Many insider trading cases, whether criminal, civil or both, start out as a referral to the SEC from FINRA or the Options Regulatory Surveillance Authority (“ORSA”) containing an informational nugget suggesting suspicious trading, or are triggered by our own trade data analytics that identify possible patterns of insider trading.

Some of our newer technologies have augmented our ability to identify suspicious trading.  In addition to our traditional issuer-based approach, we now also use a trader-based approach—focusing on identifying similar trading trends among traders.  SEC staff engage in hours of painstaking trade analysis, detailed electronic scrutiny of phone records, bank records, emails, and texts, and relentlessly dig for evidentiary scraps left behind by these often very careful and sophisticated wrongdoers that are necessary to build a case.

Let me give you one example where we used the trader-based approach and a dogged search for evidence in a parallel action.  A couple of weeks ago, the SEC filed a civil action against a registered representative at a large broker-dealer and the managing clerk at a prominent international law firm.[10]  The SEC charged that the two engaged in a four-year insider trading scheme that generated $5.6 million in trading profits by trading in advance of more than a dozen corporate transactions for which the law firm provided advice.

This action resulted from the efforts of the SEC staff and the U.S. Attorney’s Office for the District of New Jersey and the FBI.  Working together, investigators uncovered illegal tips that allegedly were conveyed, as if from a movie scene, through a middleman who met with the trader at Grand Central Station, showed him hand-written notes of the stocks he should trade, and then ate the notes to cover his trail.  On the same day that the SEC filed its case, the U.S. Attorney’s office announced that they had arrested the trader and his source.

Our insider trading cases are not limited to cases brought in parallel with criminal prosecutions.  Since October 2009, about 20% of the insider trading charges we brought involved a parallel criminal prosecution.  In contrast to many criminal cases, which often have some recording or cooperator testimony, our standalone cases are usually based on more indirect evidence—brokerage records suggesting suspicious trading, phone records indicating contact with an insider close in time to the trading, a chronology detailing material non-public events soon after the trading, and maybe, if we are lucky, cryptic emails or text messages indicating some knowledge of a relevant event or a breach of duty.  In other words, ours are usually highly circumstantial cases.

For that reason, these cases can be very challenging to try and win.  But they are very important because strong deterrence requires that there be punitive consequences for insider trading even if the evidence is insufficient to criminally prosecute and difficult to successfully try civilly.

Another civil tool we have and use in insider trading cases is our ability to freeze assets and obtain temporary injunctions based on suspicious trading so illicit profits do not disappear while we investigate.  We used this tool to great effect in July 2012 when the SEC obtained an emergency asset freeze against unknown traders just days after an announcement of the acquisition of an energy company.[11]  The SEC team moved quickly to file an emergency action after discovering that traders using brokerage accounts in Hong Kong and Singapore stood to make millions in potentially illegal profits.  Once the freeze was in place, SEC investigators carefully scrutinized the trading records to identify the traders, setting the stage for a string of successful settlements against a number of firms and individuals that unfolded over the next year and a half.  Thanks to the staff’s swift action, the SEC recovered nearly $30 million in ill-gotten gains, plus financial penalties from the foreign traders.

Microcap Fraud

Microcap fraud is another area where effective law enforcement requires both extensive cooperation with the criminal authorities and pursuit of many standalone cases.  As you know, these are most often pump-and-dump schemes where the volume and price of the stock are artificially inflated by means of a misleading promotional campaign that lures investors to buy shares.  Then, the wrongdoers sell their stock, the share price plummets, and retail investors are left holding practically worthless stock.

Like insider trading cases, these sorts of cases typically originate with a trading analysis that shows patterns of trading suggestive of illegal activity.  We then need to identify the promotional statements feeding the trading activity, investigate whether and how those statements may be actionable, identify the promoters and other participants orchestrating the scheme, and follow the stock and money, often through nominee entities with complex corporate structures, transfer agents, broker-dealers, banks, and often, off-shore financial institutions.

This methodical work can serve as the genesis for a parallel criminal case.  And these cases are uniquely conducive to criminal methods, where cooperators and undercover agents can interact with the wrongdoers and collect very powerful evidence.  We, in fact, used these methods when I was United States Attorney and were able to bring cases, along with the SEC, against over 120 defendants on a single day in connection with what we called Operation Uptick.[12]

These kinds of joint efforts continue today.  A number of our regional offices have been conducting parallel investigations with the FBI and various U.S. Attorneys to uncover penny stock schemes and involving corporate insiders, stock promoters, gatekeepers, and issuers.  In one office alone, since 2009, we have brought actions against 41 individuals and 24 companies, obtaining injunctive and other relief against all of them.  The U.S. Attorney’s Office has secured criminal convictions against 40 of the same defendants.

Parallel investigations only tell part of the microcap fraud story.  Here, too, our standalone actions have significant consequences for those trying to manipulate thinly-traded stocks for their own profit.  We often bring Section 5 charges under the Securities Act—a strict liability offense—against microcap fraud participants, suing them for directly or indirectly transacting in unregistered securities or aiding and abetting such violations.  We can bring cases against not only the issuers, but also the promoters, attorneys, auditors, broker-dealers, and others who give life to and facilitate these elaborate schemes.  If they commit fraud, we bring those charges too.[13]

We also rely on our temporary suspension authority to stop trading in securities that are the objects of pumps-and-dumps.  Just last month, we suspended trading in 255 companies, any one of which might have been the next vehicle for stock manipulators.[14]  There were more than 1,000 similar suspensions over the last two years.[15]  These trading suspensions perform a critical investor protection function—not only do they stop trading in the company’s stock for ten days, but they also have the effect of preventing market makers from displaying quotes in those securities until the company updates its public disclosures.  We also have been using our trading suspension authority more frequently to cut off trading while the pump-and-dump is in progress.

Obtaining emergency asset freezes is another essential tool in the battle against microcap schemers.  Just a couple of weeks ago, the SEC obtained an asset freeze at the outset of a case against a promoter who was charged with directing a sophisticated, international microcap stock promotion operation.[16]  We were able to demonstrate a complex series of movements of funds and securities through various foreign and domestic investment and bank accounts and obtain an order to freeze $2.5 million that had just been received from the sale of the alleged wrongdoer’s interest in a private jet that was about to be transferred to an off-shore account.

Financial Reporting Fraud
The last area of parallel cases I will mention is financial reporting fraud.  Here, we add another layer of expertise—that of our outstanding accountants.  The Enforcement Division has over 100 accountants, each of whom has unique and important expertise that is critical to these cases.  Knowledgably sifting through accounting records and audit work papers is not always glamorous work, but it is essential to making these cases, which are often based on specific and complex GAAP violations.

Just recently, we worked with the Manhattan District Attorney’s Office to bring such a case against the former chairman, executive director, and several accounting personnel from another prominent international law firm.[17]  This case required sophisticated analyses of the firm’s accounting systems.  Among the accounting misstatements alleged were the treatment of salaried partners as equity partners so that payments to them would not be treated as expenses; reclassifying uncollectible receivables and disbursements as collectible; and treating loans from partners as income received from clients.

Good financial reporting and vigilant auditing obviously go to the heart of the integrity of our markets and strong investor protection—which is why we have again intensified our focus on this area.  Last year, we created the Financial Reporting and Audit Task Force, whose objective is to focus on trends or patterns of conduct that are risk indicators for financial fraud, including in areas like revenue recognition, asset valuations, and management estimates, and through their work identify potential cases for investigation.  Our Cross-Border Working Group also has been focused on accounting fraud cases against foreign issuers whose shares trade on U.S. exchanges.  Nearly all of these cases have been standalone SEC cases.  Through this initiative, the SEC has thus far filed fraud actions against over eighty issuers, officers, and directors; instituted proceedings against auditors; revoked the registration of more than sixty issuers; suspended trading in the securities of seven issuers; approved enhancements to listing standards at the three major exchanges; and issued a related investor bulletin.[18]  This is all part of the SEC’s all-encompassing internal effort to address serious securities law violations.

Conclusion
Let me stop here.  Hopefully, I have given you a bit of an inside baseball glimpse into what enforcement looks like at the SEC, and how we go about making our cases, both on our own and with the criminal authorities.  The SEC lawyers, accountants, and other professionals that make and bring these cases are truly impressive.  They are deeply committed to the mission of the agency and make tremendous contributions not only to the cases that we bring but also to the cases brought by our criminal law enforcement partners.  That approach unquestionably gives us stronger and broader coverage that is good for investors, good for the markets, and good for the industry.

Thank you.


[1] See Section 24 of the Securities Act of 1933, 15 U.S.C. § 77x; Section 32(a) of the Securities Exchange Act of 1934, 15 U.S.C. § 78ff(a); Section 49 of the Investor Company Act of 1940, 15 U.S.C. § 80a-48; and Section 217 of the Investor Advisor Act of 1940, 15 U.S.C. § 80b-17.  In the criminal context, the Court of Appeals for the Second Circuit “has defined willfulness as ‘a realization on the defendant's part that he was doing a wrongful act’ under the securities laws, in a situation where the ‘the knowingly wrongful act involved a significant risk of effecting the violation that has occurred.”  United States v. Cassese, 428 F.3d 92, 98 (2d Cir. 2005) (internal citations omitted).

[2] See U.S. Securities and Exchange Commission 1993 Annual Report, at 1, available at http://www.sec.gov/about/annual_report/1993.pdf.

[3] The average for the five most recent fiscal years is 136.  See Select SEC and Market Data for Fiscal Years 2009-2013, available at http://www.sec.gov/about/secreports.shtml.

[4] The number of such requests in 1993 was 205.  See U.S. Securities and Exchange Commission 1993 Annual Report, at 1, available at http://www.sec.gov/about/annual_report/1993.pdf.  The average for the three most recent fiscal years is 535.  See U.S. Securities and Exchange Commission FY 2013 Annual Performance Report, at 150, available at http://www.sec.gov/about/reports/sec-fy2013-annual-performance-report.pdf.

[5] See United States v. Kordel, 397 U.S. 1, 11 (1970); see also SEC v. Dresser Indus., Inc., 628 F.2d 1368, 1377 (D.C. Cir. 1980); United States v. Stringer, 535 F.3d 929, 939 (9th Cir. 2008).

[6] See “SEC Files Anti-Bribery Charges Against Former Finance Executives and Senior Employees Of Global Tobacco Company” (Apr. 29, 2010) (alleging that a controller formalized the accounting methodology used to record bribes made in violation of the FCPA), available at https://www.sec.gov/litigation/litreleases/2010/lr21509.htm.

[7]See In the Matter of Ronald S. Rollings, Admin. Proc. File No. 3-15392 (Jul. 29, 2013) (finding that a Chief Compliance Officer failed properly to supervise an associated person who was convicted of misappropriating assets from client accounts), available at http://www.sec.gov/litigation/admin/2013/34-70058.pdf; In the Matter of Comprehensive Compliance Mgmt., Inc., Admin. Proc. File No. 3-15393 (Jul. 29, 2013) (finding that the investment advisory firm also failed to supervise the associated person), http://www.sec.gov/litigation/admin/2013/ia-3636.pdf .

[8] See Dodd-Frank Wall Street Reform and Consumer Protection Act, Section 925 (providing for collateral bars in Sections 15, 15B, and 17A of the Exchange Act and Section 203 of the Investment Advisers Act).

[9] 17 CFR § 201.103(f)(2); 17 CFR § 205.2(a)(1)(iii).

[10] Press Release No. 2014-55, “SEC Charges Stockbroker and Law Firm Managing Clerk in $5.6 Million Insider Trading Scheme,” (Mar. 19, 2014) available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370541172895.

[11] See Press Release No. 2012-145, “SEC Freezes Assets of Insider Traders in Nexen Acquisition (Jul. 27, 2012), available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1365171483502 ; Press Release No. 2014-26, Two Hong Kong-Based Firms to Pay $11 Million for Insider Trading Ahead of Nexen Acquisition by Company in China (Feb. 11, 2014), available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370540775561

[12] See, e.g., “Feds nab 120 for fraud: Mob members, securities dealers, charged with bilking victims of more than $50 million,” (Jun. 14, 2000), available at http://money.cnn.com/2000/06/14/companies/fraud/

[13] See Press Release No. 2013-249 “Penny Stock Financier Agrees to Pay $1.4 Million to Settle SEC Charges” (Nov. 25, 2013), available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370540410863; Press Release No. 2013-155, “SEC Announces Charges Against Florida-Based Penny Stock Schemes” (Aug. 14, 2013), available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370539776014; Press Release No. 2013-114, “SEC Charges San Diego-Based Promoter in Penny Stock Scheme,” (Jun. 18, 2013) available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1365171605883; Press Release No. 2013-39, “SEC Charges San Diego Lawyers and Others in an International Market Manipulation Scheme” (Mar. 13, 2013) available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1365171513254.

[14] See Press Release No. 2014-21, “SEC Continues Microcap Fraud Crackdown, Proactively Suspends Trading in 255 Dormant Shell Companies,” (Feb. 3, 2014), available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370540714936.

[15] The SEC suspended trading in 371 issuers in fiscal year 2013, and 651 issues in fiscal year 2012.  See Select SEC and Market Data for Fiscal Years 2012-2013, available at http://www.sec.gov/about/secreports.shtml.

[16] See Press Release No. 2014-52, “SEC Obtains Asset Freeze Against Promoter Behind Microcap Stock Scalping Scheme,” (Mar. 13, 2014), available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370541128311

[17] See Press Release No. 2014-45, “SEC Charges Five Executives and Finance Professionals Behind Fraudulent Bond Offering by International Law Firm,” (Mar. 6, 2014) available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370540889964.

[18] See, e.g., Press Release No. 2014-47, “SEC Charges Animal Feed Company and Top Executives in China and U.S. With Accounting Fraud,” (Mar. 11, 2014) available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370541102314; (Nov. 7, 2013); Press Release No. 2013-205, “SEC Charges New Jersey-Based Accounting Firm and Founding Partner for Failed Audits of China-Based Company,” (Sep. 30, 2013) available at http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370539849819;  Lit. Release No. 22755, “SEC Files Fraud Charges Against China Intelligent Lighting and Electronics, Inc.; NIVS Intellimedia Technology Group, Inc.; and Their Sibling CEOs,” (Jul. 22, 2013) available at http://www.sec.gov/litigation/litreleases/2013/lr22755.htm.

JOINT CHIEFS CHAIRMAN GEN. DEMPSEY SUGGESTS CHANGES COMING IN MIDDLE EAST ALLIANCES

U.S. Army Gen. Martin E. Dempsey, chairman of the Joint Chiefs of Staff, meets with senior members of the Institute for National Security Studies in Jerusalem, March 31, 2014. DOD photo by D. Myles Cullen  

FROM:  U.S. DEFENSE DEPARTMENT 
Dempsey Sees Possibility of New Alliances in Mideast
By Jim Garamone
American Forces Press Service

JERUSALEM , March 31, 2014 – The chairman of the Joint Chiefs of Staff says he sees the possibility of new alliances emerging in the Middle East, springing from the on-going instability across much of the region.

Army Gen. Martin E. Dempsey is in Israel to discuss issues of mutual strategic interest with Israeli defense officials.

Dempsey told reporters that current instability across the Middle East provides opportunities, to include “an outreach to other nations who may not have been willing to be partners in the past.”

Dempsey arrived in Israel yesterday and immediately went into meetings with Prime Minister Benjamin Netanyahu and Defense Minister Moshe Yaalon. Israeli Army Lt. Gen. Benny Gantz, the chief of the Israeli General Staff, is hosting Dempsey.

In his meetings with Israeli officials, Dempsey said he’s trying to step away from reacting to the daily headlines in order to look at the region strategically.
The Middle East is experiencing a period of instability affecting Egypt, Syria, Iran and other areas, which is having an impact on the strategic landscape.

This, Dempsey said, is causing countries that may not have agreed on much in the past to realize they have a common cause toward regional instability.
Dempsey pointed to the Persian Gulf states as an example. They “may not have been as open-minded about the potential for cooperation with Israel in any way,” he said.

“What we discussed,” he added, “was the possibility that there were opportunities that would present themselves because of the instability around them that could create a different web of alliances than existed before.

“What I’m suggesting,” Dempsey continued, “[is] the possibility of new and different alliances in the region in response to this instability.”

The chairman said he’s neither optimistic nor pessimistic about the Mideast situation.

“I think there are enough issues across the region in common that it should provide an opportunity for greater cooperation,” Dempsey said. “So our allies become allies with each other.”

For example, many nations have discussed strategy to counter al-Qaida. “Al-Qaida is adapting regionally because we’ve succeeded in putting pressure where they used to operate with impunity,” Dempsey said. “What you see now is al-Qaida core is much less capable, but there are other organizations that have branded themselves with the al-Qaida ideology.”

The al-Qaida network crosses the region, and this has caused the United States to come together militarily with like-minded and interested parties to discuss everything from intelligence sharing to capacity building to foreign military sales. All of these things put pressure on the group.

The chairman called this just one example of an opportunity that didn’t exist before.

Combating Iranian moves in the region could provide other opportunities, he said. Iran is involved with arms trafficking, building surrogate networks and launching cyber attacks.

“It seems to me that as threats evolve so, too, do our systems of alliances to deal with them,” Dempsey said.

Military officials from many countries and at many levels are having these conversations “so we can be a network to confront networks,” he said.
“Sometimes we’ve been accused of not leading enough,” he said. “I have found both a great appetite and a great acceptance for our military leadership, especially in things like building partner capacity, which ultimately is the greatest strategic hedge against risk in the future -- far more so than any direct action.”