FROM: U.S JUSTICE DEPARTMENT
Thursday, December 18, 2014
Department of Justice Takes Legal Action to Address Pattern and Practice of Excessive Force and Violence at NYC Jails on Rikers Island that Violates the Constitutional Rights of Young Male Inmates
Attorney General Eric Holder, Acting Assistant Attorney General Vanita Gupta for the Civil Rights Division and U.S. Attorney Preet Bharara for the Southern District of New York announced today that the United States has taken legal action to ensure that critically important reforms are put in place to address conduct at Rikers Island that has violated the constitutional rights of New York City’s youngest inmates, who are between the ages of 16 and 18 (“young inmates”). Specifically, the Department of Justice has filed a motion seeking the court’s permission to join and become a plaintiff in a pending class action lawsuit against New York City, Nunez v. City of New York (the “Nunez Action”), which alleges that the Department of Correction (“DOC”) has engaged in a pattern and practice of using unnecessary and excessive force against inmates. The department has taken this legal step as part of its ongoing effort to ensure that DOC implements all needed institutional reforms promptly, and that these reforms are lasting, verifiable and enforceable through the judicial process.
"With this filing, the Department of Justice is taking an important step to ensure the safety and constitutional rights of young people incarcerated at Rikers Island," said Attorney General Holder. "We've seen alarming evidence of unnecessary and excessive use of force against juveniles, as well as a systemic failure to protect them from violence and deeply troubling -- and potentially scarring -- use of solitary confinement. This action allows the Justice Department to seek necessary reforms to remedy these unlawful conditions, to ensure fair treatment, and to provide all incarcerated young people with the protections, and opportunities to build better futures, that they deserve."
“Today we are taking legal action to ensure that critically important reforms are put in place to address the culture of violence and overuse of punitive segregation at Rikers Island that has violated the constitutional rights of New York City’s youngest inmates,” said Acting Assistant Attorney General Gupta. “We stand ready to work with the city to remedy these deeply disturbing conditions for the safety of confined youth, remedies that will ultimately also promote public safety and the safety of correctional officers.”
“Sometimes it’s the case that bureaucracy can get in the way of reform-minded thinking and comprehensive cultural change,” said U.S. Attorney Bharara. “We hope that won’t be the case here. We welcome the aspirations articulated by Commissioner Ponte but we hope those aspirations will find concrete expression in the form of permanent, enforceable, and verifiable terms in a court-approved settlement agreement. The devil, as they say, is in the details and we have come to the conclusion that joining the pending case as a formal party is the best and most efficient way to get those details done. That is why we are now taking the steps necessary to carry out our responsibility under the law. Given the longstanding sad state of affairs at Rikers Island, our impatience is more than understandable. As I’ve said before, one way or another, we will get enduring and enforceable reform at Rikers Island.”
On August 4, 2014, the department issued a report that concluded that “a deep-seated culture of violence is pervasive throughout the adolescent facilities at Rikers, and DOC staff routinely use force not as a last resort, but instead as a means to control the adolescent population and punish disorderly or disrespectful behavior.” The report urged the city to adopt and implement over 70 specific remedial measures. Although DOC’s new leadership has taken some positive steps in response to the report with respect to the 16 and 17-year old population, including reducing the inmate-to-staff ratio, developing new programming, and moving towards eliminating the use of punitive segregation, much more needs to be done.
The department’s proposed 36-page complaint-in-intervention (“complaint”), filed today along with a motion to intervene in the Nunez action, alleges that the city has engaged in a pattern and practice of violating the constitutional rights of young inmates, and that the city’s deliberate indifference to these constitutional rights has caused these inmates serious physical, psychological, and emotional harm. Like the August 4, 2014, report, the complaint focuses on use of force by staff, inmate-on-inmate violence, and the use of punitive segregation.
Specifically, the complaint alleges:
Staff use force against young inmates with alarming frequency.In Fiscal Year 2014, there were 553 reported staff use of force incidents involving young inmates at the Robert D.Davoren Center (“RNDC”) and the Eric M.Taylor Center (“EMTC”), the two facilities that housed most young inmates.These incidents resulted in 1,088 injuries.
Inmate-on-inmate fights and assaults are pervasive in large part because inmates are inadequately supervised by inexperienced and poorly trained officers.In Fiscal Year 2014, there were 657 reported inmate-on-inmate fights involving young inmates at RNDC and EMTC.
Staff use of force and inmate-on-inmate fights and assaults have resulted in an alarming number of serious injuries to young inmates, including broken jaws, broken orbital bones, broken noses, long bone fractures, and lacerations requiring stitches.
Staff frequently punch, strike, or kick young inmates in the head or facial area.
Force is used as a means to punish young inmates, and staff unnecessarily continue to use force against inmates who already have been restrained.
Force is used in response to inmate verbal taunts and insults.
Specialized response teams, including probe and cell extraction teams, use excessive force.
Staff regularly tell inmates to “stop resisting,” even though the inmate has been completely subdued, to justify the use of force.
Use of excessive force is common in areas outside video surveillance coverage.DOC recently transferred many 18-year old inmates to housing units that have no video surveillance at all.
The complaint further alleges that, notwithstanding a long and troubled history of pervasive use of force against inmates at Rikers, the city has for years failed to address systemic deficiencies, including:
Failure to ensure that use of force is accurately reported, and allowing a powerful code of silence to persist.
Failure to conduct thorough and comprehensive investigations into use of force incidents.
Failure to appropriately discipline staff for using excessive and unnecessary force.
Failure to ensure that inmates are adequately supervised.
Failure to implement an adequate age-appropriate classification system.
Failure to provide staff with effective training on the proper use of force and how to appropriately manage youth.
In addition, the complaint asserts that the city has engaged in a pattern and practice of placing young inmates in punitive segregation at an alarming rate and for excessive periods of time.
Since issuing its report in August, the U.S. Attorney’s Office has had several meetings with the city’s Law Department regarding the U.S. Attorney’s Office proposed remedial measures. Some of these discussions have included attorneys representing the Nunez plaintiffs, who have been engaging in settlement discussions with the city for several months. However, thus far, although there has been some constructive dialogue, the city has been unwilling to commit to an enforceable agreement including the type of reforms and oversight that are necessary to fully address the long-standing problems at Rikers and safeguard the constitutional rights of inmates.
U.S. Attorney Bharara thanked the Board of Correction for its continuing assistance in connection with this matter.
This case is being handled by the Office’s Civil Rights Unit. Assistant U.S. Attorneys Jeffrey K. Powell and Emily E. Daughtry are in charge of the case.
Thursday, December 18, 2014
REMARKS: ACTING AG GUPTA ON UNCONSTITUTIONAL CONDITIONS OF CONFINEMENT FOR YOUTH ON RIKERS ISLAND
FROM: U.S. JUSTICE DEPARTMENT
Remarks by Acting Assistant Attorney General Vanita Gupta at the Press Conference to Announce the Department's Intervention to Remedy Unconstitutional Conditions of Confinement for Youth on Rikers Island
New York City, NYUnited States ~ Thursday, December 18, 2014
Remarks as Prepared for Delivery
Thank you, Preet. It is an honor to join you to announce the filing of this important piece of litigation. The enforcement of the nation’s civil rights laws is a partnership between the Civil Rights Division and United States Attorneys across this country. Your office has been a leader in this effort and you and your team have undertaken many important civil rights initiatives, including your critical work on Rikers Island.
As Preet mentioned, we are here today to announce our intervention in a class action suit against New York City over a pattern and practice of excessive force and violence in New York City jails on Rikers Island that violate the constitutional rights of adolescent inmates.
The authority to deprive individuals of their liberty and place them in a prison or a jail is one of the most profound powers of government. With the exercise of that power comes the responsibility to ensure that at least minimum standards of care and protection are observed. Our constitution recognizes that individuals who are incarcerated have the right to reasonable protection from violence, and to be provided basic necessities of life. These are not only essential constitutional principles, but good public policy and fundamental to public safety and the safety of correctional staff. When governments fail to meet these basic responsibilities, the Department of Justice stands ready to appeal to the Courts to ensure that basic rights are respected. Today, we are doing just that -- taking legal action to ensure that critically important reforms are put in place to address conduct reflecting the culture of violence at Rikers Island that has violated the constitutional rights of New York City’s youngest inmates.
The mandate to ensure safe and humane jail conditions is never more important than when we incarcerate young people. The findings of the investigation of the United States Attorney’s Office can only be described as deeply disturbing. Young people are subject to unnecessary and excessive violence by staff, and to the overuse of punitive segregation. They are not protected from other inmates. This suit is essential to bring urgent and necessary, sustainable change to the conditions at Rikers Island through a court enforceable agreement.
The Civil Rights Division works to address unconstitutional conditions in prisons, jails and juvenile facilities across this nation. For example, from Cook County, Illinois to New Orleans, Louisiana to Muscogee, Oklahoma, we have reached cooperative agreements that ensure that people in prison are treated humanely and consistent with the constitution. From that work we have learned that, sadly, Rikers is not alone. In far too many places, youth held in adult jails are subject to abhorrent and abusive conditions.
We have also learned that mistreatment, violence and neglect are not inevitable. The problems we see on Rikers Island can be fixed. Reform works and the changes we seek will not only ensure that the rights of youthful inmates are protected, but will make a safer work place for corrections staff and promote public safety.
Most prisoners return to their communities following incarceration. If our compassion does not motivate us to ensure that youthful prisoners are treated with a minimum of decency, our self-interest demands it. The conditions in which they are confined, the services that they are provided and the opportunities that they are given are critical to their ability to succeed when they come home. We can make kids better or worse by the way we treat them while they are locked up.
Moreover, the adverse and dangerous conditions that prevail on Rikers Island place the lives and safety of staff at risk. It is clear from our investigation that corrections officers do not have adequate programmatic options to deal with an admittedly complex and difficult population. The risk is compounded by the failure to give staff sufficient policy guidance, necessary training, support through supervision and important accountability systems. These systems failures create a toxic mix that harms prisoners and staff alike.
We recognize that the city has taken initial steps to start reform. We applaud the Mayor for his public commitment to fixing the problems. We are committed to working with the city to get at core issues. Through this litigation, we seek a court enforceable agreement to ensure that:
excess force will be prohibited, that staff will be trained to deescalate and maintain control without excessive force and that when force is used inappropriately it will be identified and addressed;
That necessary steps will be taken to protect youth from violence; and
That other necessary measures are taken to ensure that the rights of adolescent inmates are protected.
It is our sincere hope that we can resolve these issues with the city through a court enforceable agreement with a monitor in order to implement sustainable systemic reforms. We also hope that this matter can be resolved quickly so that all available resources can be directed at fixing the problems and not in litigation. Thank you.
Remarks by Acting Assistant Attorney General Vanita Gupta at the Press Conference to Announce the Department's Intervention to Remedy Unconstitutional Conditions of Confinement for Youth on Rikers Island
New York City, NYUnited States ~ Thursday, December 18, 2014
Remarks as Prepared for Delivery
Thank you, Preet. It is an honor to join you to announce the filing of this important piece of litigation. The enforcement of the nation’s civil rights laws is a partnership between the Civil Rights Division and United States Attorneys across this country. Your office has been a leader in this effort and you and your team have undertaken many important civil rights initiatives, including your critical work on Rikers Island.
As Preet mentioned, we are here today to announce our intervention in a class action suit against New York City over a pattern and practice of excessive force and violence in New York City jails on Rikers Island that violate the constitutional rights of adolescent inmates.
The authority to deprive individuals of their liberty and place them in a prison or a jail is one of the most profound powers of government. With the exercise of that power comes the responsibility to ensure that at least minimum standards of care and protection are observed. Our constitution recognizes that individuals who are incarcerated have the right to reasonable protection from violence, and to be provided basic necessities of life. These are not only essential constitutional principles, but good public policy and fundamental to public safety and the safety of correctional staff. When governments fail to meet these basic responsibilities, the Department of Justice stands ready to appeal to the Courts to ensure that basic rights are respected. Today, we are doing just that -- taking legal action to ensure that critically important reforms are put in place to address conduct reflecting the culture of violence at Rikers Island that has violated the constitutional rights of New York City’s youngest inmates.
The mandate to ensure safe and humane jail conditions is never more important than when we incarcerate young people. The findings of the investigation of the United States Attorney’s Office can only be described as deeply disturbing. Young people are subject to unnecessary and excessive violence by staff, and to the overuse of punitive segregation. They are not protected from other inmates. This suit is essential to bring urgent and necessary, sustainable change to the conditions at Rikers Island through a court enforceable agreement.
The Civil Rights Division works to address unconstitutional conditions in prisons, jails and juvenile facilities across this nation. For example, from Cook County, Illinois to New Orleans, Louisiana to Muscogee, Oklahoma, we have reached cooperative agreements that ensure that people in prison are treated humanely and consistent with the constitution. From that work we have learned that, sadly, Rikers is not alone. In far too many places, youth held in adult jails are subject to abhorrent and abusive conditions.
We have also learned that mistreatment, violence and neglect are not inevitable. The problems we see on Rikers Island can be fixed. Reform works and the changes we seek will not only ensure that the rights of youthful inmates are protected, but will make a safer work place for corrections staff and promote public safety.
Most prisoners return to their communities following incarceration. If our compassion does not motivate us to ensure that youthful prisoners are treated with a minimum of decency, our self-interest demands it. The conditions in which they are confined, the services that they are provided and the opportunities that they are given are critical to their ability to succeed when they come home. We can make kids better or worse by the way we treat them while they are locked up.
Moreover, the adverse and dangerous conditions that prevail on Rikers Island place the lives and safety of staff at risk. It is clear from our investigation that corrections officers do not have adequate programmatic options to deal with an admittedly complex and difficult population. The risk is compounded by the failure to give staff sufficient policy guidance, necessary training, support through supervision and important accountability systems. These systems failures create a toxic mix that harms prisoners and staff alike.
We recognize that the city has taken initial steps to start reform. We applaud the Mayor for his public commitment to fixing the problems. We are committed to working with the city to get at core issues. Through this litigation, we seek a court enforceable agreement to ensure that:
excess force will be prohibited, that staff will be trained to deescalate and maintain control without excessive force and that when force is used inappropriately it will be identified and addressed;
That necessary steps will be taken to protect youth from violence; and
That other necessary measures are taken to ensure that the rights of adolescent inmates are protected.
It is our sincere hope that we can resolve these issues with the city through a court enforceable agreement with a monitor in order to implement sustainable systemic reforms. We also hope that this matter can be resolved quickly so that all available resources can be directed at fixing the problems and not in litigation. Thank you.
SECRETARY OF STATE KERRY'S STATEMENT ON CUBA POLICY ANNOUNCEMENT
FROM: U.S. STATE DEPARTMENT
Announcement of Cuba Policy Changes
Press Statement
John Kerry
Secretary of State
Washington, DC
December 17, 2014
I was a seventeen year old kid watching on a black and white television set when I first heard an American President talk of Cuba as an "imprisoned island.”
For five and a half decades since, our policy toward Cuba has remained virtually frozen, and done little to promote a prosperous, democratic and stable Cuba. Not only has this policy failed to advance America's goals, it has actually isolated the United States instead of isolating Cuba.
Since 2009, President Obama has taken steps forward to change our relationship and improve the lives of the Cuban people by easing restrictions on remittances and family travel. With this new opening, the President has committed the United States to begin to chart an even more ambitious course forward.
Beginning more than twenty years ago, I have seen firsthand as three presidents -- one Republican and two Democrats -- have undertaken a similar effort to change the United States' relationship with Vietnam. It wasn't easy. It isn't complete still today. But it had to start somewhere, and it has worked.
As we did with Vietnam, changing our relationship with Cuba will require an investment of time, energy and resources. Today’s step also reflects our firm belief that the risk and the cost of trying to turn the tide is far lower than the risk and cost of remaining stuck in an ideological cement of our own making.
This new course will not be without challenges, but it is based not on a leap of faith but on a conviction that it's the best way to help bring freedom and opportunity to the Cuban people, and to promote America's national security interests in the Americas, including greater regional stability and economic opportunities for American businesses.
In January, as part of the President’s directive to discuss moving toward re-establishment of diplomatic relations, my Assistant Secretary for the Western Hemisphere Roberta Jacobson will travel to Cuba to lead the U.S. Delegation to the next round of U.S.-Cuba Migration Talks. I look forward to being the first Secretary of State in 60 years to visit Cuba. At President Obama’s request, I have also asked my team to initiate a review of Cuba’s designation as a State Sponsor of Terrorism.
Going forward, a critical focus of our increased engagement will continue to be on improving the Cuban Government’s respect for human rights and advocating for democratic reforms within Cuba. Promoting freedom of speech and entrepreneurship and an active civil society will only strengthen Cuban society and help to reintegrate Cuba into the international community.
Announcement of Cuba Policy Changes
Press Statement
John Kerry
Secretary of State
Washington, DC
December 17, 2014
I was a seventeen year old kid watching on a black and white television set when I first heard an American President talk of Cuba as an "imprisoned island.”
For five and a half decades since, our policy toward Cuba has remained virtually frozen, and done little to promote a prosperous, democratic and stable Cuba. Not only has this policy failed to advance America's goals, it has actually isolated the United States instead of isolating Cuba.
Since 2009, President Obama has taken steps forward to change our relationship and improve the lives of the Cuban people by easing restrictions on remittances and family travel. With this new opening, the President has committed the United States to begin to chart an even more ambitious course forward.
Beginning more than twenty years ago, I have seen firsthand as three presidents -- one Republican and two Democrats -- have undertaken a similar effort to change the United States' relationship with Vietnam. It wasn't easy. It isn't complete still today. But it had to start somewhere, and it has worked.
As we did with Vietnam, changing our relationship with Cuba will require an investment of time, energy and resources. Today’s step also reflects our firm belief that the risk and the cost of trying to turn the tide is far lower than the risk and cost of remaining stuck in an ideological cement of our own making.
This new course will not be without challenges, but it is based not on a leap of faith but on a conviction that it's the best way to help bring freedom and opportunity to the Cuban people, and to promote America's national security interests in the Americas, including greater regional stability and economic opportunities for American businesses.
In January, as part of the President’s directive to discuss moving toward re-establishment of diplomatic relations, my Assistant Secretary for the Western Hemisphere Roberta Jacobson will travel to Cuba to lead the U.S. Delegation to the next round of U.S.-Cuba Migration Talks. I look forward to being the first Secretary of State in 60 years to visit Cuba. At President Obama’s request, I have also asked my team to initiate a review of Cuba’s designation as a State Sponsor of Terrorism.
Going forward, a critical focus of our increased engagement will continue to be on improving the Cuban Government’s respect for human rights and advocating for democratic reforms within Cuba. Promoting freedom of speech and entrepreneurship and an active civil society will only strengthen Cuban society and help to reintegrate Cuba into the international community.
DOJ ANNOUNCES INDICTMENT OF 14 IN CONNECTION WITH 2012 FUNGAL MENINGITIS OUTBREAK
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, December 17, 2014
14 Indicted in Connection with New England Compounding Center and Nationwide Fungal Meningitis Outbreak
A 131-count criminal indictment was unsealed today in Boston in connection with the 2012 nationwide fungal meningitis outbreak, the Justice Department announced. Barry J. Cadden, owner and head pharmacist of New England Compounding Center (NECC) and NECC’s supervisory pharmacist Glenn A. Chin were charged with 25 acts of second-degree murder in Florida, Indiana, Maryland, Michigan, North Carolina, Tennessee and Virginia.
The outbreak was caused by contaminated vials of preservative-free methylprednisolone acetate (MPA) manufactured by NECC, located in Framingham, Massachusetts. The U.S. Centers for Disease Control and Prevention (CDC) reported that 751 patients in 20 states were diagnosed with a fungal infection after receiving injections of NECC’s MPA. Of those 751 patients, the CDC reported that 64 patients in nine states died.
Twelve other individuals, all associated with NECC, including six other pharmacists, the director of operations, the national sales director, an unlicensed pharmacy technician, two of NECC’s owners, and one other individual were charged with additional crimes including racketeering, mail fraud, conspiracy, contempt, structuring, and violations of the Food, Drug and Cosmetic Act.
“As alleged in the indictment, these employees knew they were producing their medication in an unsafe manner and in insanitary conditions, and authorized it to be shipped out anyway, with fatal results,” said Attorney General Eric Holder. “With the indictment and these arrests, the Department of Justice is taking decisive action to hold these individuals accountable for their alleged participation in grievous wrongdoing. Actions like the ones alleged in this case display not only a reckless disregard for health and safety regulations, but also an extreme and appalling indifference to human life. American consumers have a right to know that their medications are safe to use, and this case proves that the Department of Justice will always stand resolute to ensure that right, to protect the American people, and to hold wrongdoers accountable to the fullest extent of the law.”
“Every patient receiving treatment deserves the peace of mind and knowledge that the medicine they are receiving is safe,” said Acting Associate Attorney General Stuart Delery. “When people and companies violate that trust and break the law, the consequences to patients and their families can be catastrophic. That’s why it remains a priority of the Department to use every tool at our disposal to protect patients’ safety and hold bad actors accountable.”
“Those who produce and sell the drugs that we take have a special responsibility to make sure that they prepare those drugs under suitable conditions, and that what leaves their facilities is safe,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “The indictment charges that the defendants’ conduct in this case was corrupt and carried out with a complete disregard to the public’s health. The department‘s Consumer Protection Branch along with our law enforcement partners is steadfast in our commitment to use every criminal and civil tool at our disposal to hold accountable those who are willing to put our lives at risk in the reckless pursuit of their profits.”
“Ever since the outbreak occurred, we have been committed to bringing to justice the individuals responsible for the deaths and suffering of so many innocent victims,” said U.S. Attorney Carmen Ortiz for the District of Massachusetts. “The indictment announced today is the first step in that process which addresses alleged criminal wrongdoing at NECC, a business that prioritized production and profit over safety. We will make every effort to ensure that licensed pharmacists, and those working with them, are held to a standard of care that protects the public from unsafe and dangerous medications.”
“Two years after the fungal meningitis outbreak, our hearts continue to go out to the victims of this tragedy and to their families,” said FDA Commissioner Margaret A. Hamburg M.D. “Our work on behalf of all patients who want and deserve medicines that do not subject them to undue risk is far from done. The FDA will continue to work aggressively on many fronts with the states, the Department of Justice, and others to protect the American public from unsafe compounded drug products.”
“Threats to public health, as alleged in today's indictment, are a priority for the FBI,” said Assistant Director Joseph S. Campbell of the FBI’s Criminal Division. “Together with our law enforcement and regulatory agency partners, we are determined to stop practices that jeopardize patients' health and violate the public trust. These types of investigations are complex and resource intensive. We greatly appreciate the efforts of our partners in this case and look forward to working with them to effectively identify criminal activities and combat fraudulent and abusive health practices in the future.”
The 14 individuals charged in the indictment are Barry J. Cadden, 48, of Wrentham, Massachusetts; Glenn A. Chin, 46, of Canton, Massachusetts; Gene Svirskiy, 33, of Ashland, Massachusetts; Christopher M. Leary, 30, of Shrewsbury, Massachusetts; Joseph M. Evanosky, 42, of Westford, Massachusetts; Scott M. Connolly, 42, of East Greenwich, Rhode Island; Sharon P. Carter, 50, of Hopkinton, Massachusetts; Alla V. Stepanets, 34, of Framingham, Massachusetts; Gregory A. Conigliaro, 49 of Southborough, Massachusetts; Robert A. Ronzio, 40, of North Providence, Rhode Island; Kathy Chin, 42, of Canton, Massachusetts; Michelle Thomas, 31 of Cumberland, Rhode Island; Carla Conigliaro, 51, of Dedham, Massachusetts and Douglas A. Conigliaro, 53, of Dedham, Massachusetts.
The 25 second-degree murders are included in the indictment as predicate racketeering acts under the Racketeer Influenced and Corrupt Organizations Act (RICO). These charges relate to patients who received NECC MPA and died in Florida, Indiana, Maryland, Michigan, North Carolina, Tennessee and Virginia. As a general matter, and depending on particular state law, second-degree murder does not require the government to prove Cadden and Chin had specific intent to kill the 25 patients, but rather that Cadden and Chin acted with extreme indifference to human life. According to the indictment, Cadden and Chin knew that NECC was making MPA in a manner and in an environment in which they could not assure that the drug was sterile as it was identified to be. Despite knowing that they were making the MPA in an unsafe manner and in insanitary conditions, Cadden and Chin nonetheless allegedly directed and authorized the shipping of MPA to NECC customers nationwide. It is alleged that Cadden and Chin were aware that doctors would inject MPA into their patients’ bodies, and that if the MPA was not in fact sterile, it could kill them.
The 25 murder racketeering acts comprise only a portion of the broad racketeering scheme charged in the indictment. The indictment also alleges that NECC’s other pharmacists knowingly made and sold numerous drugs in a similar unsafe manner and in insanitary conditions. The unsafe manner alleged in the indictment includes, among other things, the pharmacists’ failure to properly sterilize NECC’s drugs, failure to properly test NECC’s drugs for sterility, and failure to wait for test results before sending the drugs to customers. The insanitary conditions alleged in the indictment include, among other things, NECC’s lack of proper cleaning and NECC’s failure to take any action when its own environmental monitoring repeatedly detected mold and bacteria within NECC’s clean room suite of rooms throughout 2012.
It is further alleged that NECC repeatedly took steps to shield its operations from regulatory oversight by the FDA by claiming to be a pharmacy dispensing drugs pursuant to valid, patient-specific prescriptions. In fact, NECC routinely dispensed drugs in bulk without valid prescriptions. The indictment alleges that NECC even used fictional and celebrity names on fake prescriptions to dispense drugs.
Finally, the indictment charges Carla Conigliaro, the majority shareholder of NECC, and her husband Douglas Conigliaro with transferring assets following the fungal meningitis outbreak. Specifically, the indictment charges that after NECC declared bankruptcy, and the bankruptcy court ordered the shareholders not to transfer assets, Carla and Doug Conigliaro transferred approximately $33.3 million to eight different bank accounts opened after the NECC bankruptcy.
Cadden and Chin face a maximum of up to life in prison if convicted on all counts.
“Although no VA patients were affected by the fungal meningitis outbreak, VA unknowingly purchased a variety of pharmaceutical products over a three year period from NECC that were intentionally produced in an unsafe manner under insanitary conditions,” said Assistant Inspector General for Investigations James J. O’Neill for the Office of Inspector General, Department of Veterans Affairs. “We are pleased to have contributed to this outstanding multi-agency criminal investigation.”
“Today's results are part of an ongoing effort by the Defense Criminal Investigative Service and its law enforcement partners to protect the integrity of the Department of Defense's health care program and the quality of care our service members receive,” said Deputy Inspector General for Investigations James B. Burch for the U.S. Department of Defense Office of the Inspector General. “The Defense Criminal Investigative Service will continue to pursue allegations of health care fraud that put the Warfighter at risk.”
“The U.S. Postal Inspection Service is pleased to join our federal partners in this announcement” said Postal Inspector in Charge Shelly A. Binkowski of the Boston Division. “What's particularly disturbing about this case is that through their alleged misrepresentation and greed, these defendants put the health and well-being of others at a high level of risk. This criminal action today demonstrates the commitment and vigilance of postal inspectors and other federal agents to pursue criminals who prey on the public in such an egregious way.”
In announcing the indictment today, Attorney General Holder and U.S. Attorney Ortiz acknowledged the assistance and cooperation of Michigan State Attorney General Bill Schuette. The state of Michigan had the most deaths during the outbreak.
The investigation was conducted by the FDA Office of Criminal Investigations and the FBI with assistance by the Defense Criminal Investigative Service, U.S. Department of Defense, Office of Inspector General; Department of Veterans Affairs Office of Inspector General and U.S. Postal Inspection Service. The case is being prosecuted by Assistant U.S. Attorneys George P. Varghese and Amanda P.M. Strachan of the Health Care Fraud Unit for the U.S. Attorney’s Office in the District of Massachusetts, and Trial Attorney John W.M. Claud of the Civil Division’s Consumer Protection Branch.
The details contained in the indictment are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt.
Wednesday, December 17, 2014
14 Indicted in Connection with New England Compounding Center and Nationwide Fungal Meningitis Outbreak
A 131-count criminal indictment was unsealed today in Boston in connection with the 2012 nationwide fungal meningitis outbreak, the Justice Department announced. Barry J. Cadden, owner and head pharmacist of New England Compounding Center (NECC) and NECC’s supervisory pharmacist Glenn A. Chin were charged with 25 acts of second-degree murder in Florida, Indiana, Maryland, Michigan, North Carolina, Tennessee and Virginia.
The outbreak was caused by contaminated vials of preservative-free methylprednisolone acetate (MPA) manufactured by NECC, located in Framingham, Massachusetts. The U.S. Centers for Disease Control and Prevention (CDC) reported that 751 patients in 20 states were diagnosed with a fungal infection after receiving injections of NECC’s MPA. Of those 751 patients, the CDC reported that 64 patients in nine states died.
Twelve other individuals, all associated with NECC, including six other pharmacists, the director of operations, the national sales director, an unlicensed pharmacy technician, two of NECC’s owners, and one other individual were charged with additional crimes including racketeering, mail fraud, conspiracy, contempt, structuring, and violations of the Food, Drug and Cosmetic Act.
“As alleged in the indictment, these employees knew they were producing their medication in an unsafe manner and in insanitary conditions, and authorized it to be shipped out anyway, with fatal results,” said Attorney General Eric Holder. “With the indictment and these arrests, the Department of Justice is taking decisive action to hold these individuals accountable for their alleged participation in grievous wrongdoing. Actions like the ones alleged in this case display not only a reckless disregard for health and safety regulations, but also an extreme and appalling indifference to human life. American consumers have a right to know that their medications are safe to use, and this case proves that the Department of Justice will always stand resolute to ensure that right, to protect the American people, and to hold wrongdoers accountable to the fullest extent of the law.”
“Every patient receiving treatment deserves the peace of mind and knowledge that the medicine they are receiving is safe,” said Acting Associate Attorney General Stuart Delery. “When people and companies violate that trust and break the law, the consequences to patients and their families can be catastrophic. That’s why it remains a priority of the Department to use every tool at our disposal to protect patients’ safety and hold bad actors accountable.”
“Those who produce and sell the drugs that we take have a special responsibility to make sure that they prepare those drugs under suitable conditions, and that what leaves their facilities is safe,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “The indictment charges that the defendants’ conduct in this case was corrupt and carried out with a complete disregard to the public’s health. The department‘s Consumer Protection Branch along with our law enforcement partners is steadfast in our commitment to use every criminal and civil tool at our disposal to hold accountable those who are willing to put our lives at risk in the reckless pursuit of their profits.”
“Ever since the outbreak occurred, we have been committed to bringing to justice the individuals responsible for the deaths and suffering of so many innocent victims,” said U.S. Attorney Carmen Ortiz for the District of Massachusetts. “The indictment announced today is the first step in that process which addresses alleged criminal wrongdoing at NECC, a business that prioritized production and profit over safety. We will make every effort to ensure that licensed pharmacists, and those working with them, are held to a standard of care that protects the public from unsafe and dangerous medications.”
“Two years after the fungal meningitis outbreak, our hearts continue to go out to the victims of this tragedy and to their families,” said FDA Commissioner Margaret A. Hamburg M.D. “Our work on behalf of all patients who want and deserve medicines that do not subject them to undue risk is far from done. The FDA will continue to work aggressively on many fronts with the states, the Department of Justice, and others to protect the American public from unsafe compounded drug products.”
“Threats to public health, as alleged in today's indictment, are a priority for the FBI,” said Assistant Director Joseph S. Campbell of the FBI’s Criminal Division. “Together with our law enforcement and regulatory agency partners, we are determined to stop practices that jeopardize patients' health and violate the public trust. These types of investigations are complex and resource intensive. We greatly appreciate the efforts of our partners in this case and look forward to working with them to effectively identify criminal activities and combat fraudulent and abusive health practices in the future.”
The 14 individuals charged in the indictment are Barry J. Cadden, 48, of Wrentham, Massachusetts; Glenn A. Chin, 46, of Canton, Massachusetts; Gene Svirskiy, 33, of Ashland, Massachusetts; Christopher M. Leary, 30, of Shrewsbury, Massachusetts; Joseph M. Evanosky, 42, of Westford, Massachusetts; Scott M. Connolly, 42, of East Greenwich, Rhode Island; Sharon P. Carter, 50, of Hopkinton, Massachusetts; Alla V. Stepanets, 34, of Framingham, Massachusetts; Gregory A. Conigliaro, 49 of Southborough, Massachusetts; Robert A. Ronzio, 40, of North Providence, Rhode Island; Kathy Chin, 42, of Canton, Massachusetts; Michelle Thomas, 31 of Cumberland, Rhode Island; Carla Conigliaro, 51, of Dedham, Massachusetts and Douglas A. Conigliaro, 53, of Dedham, Massachusetts.
The 25 second-degree murders are included in the indictment as predicate racketeering acts under the Racketeer Influenced and Corrupt Organizations Act (RICO). These charges relate to patients who received NECC MPA and died in Florida, Indiana, Maryland, Michigan, North Carolina, Tennessee and Virginia. As a general matter, and depending on particular state law, second-degree murder does not require the government to prove Cadden and Chin had specific intent to kill the 25 patients, but rather that Cadden and Chin acted with extreme indifference to human life. According to the indictment, Cadden and Chin knew that NECC was making MPA in a manner and in an environment in which they could not assure that the drug was sterile as it was identified to be. Despite knowing that they were making the MPA in an unsafe manner and in insanitary conditions, Cadden and Chin nonetheless allegedly directed and authorized the shipping of MPA to NECC customers nationwide. It is alleged that Cadden and Chin were aware that doctors would inject MPA into their patients’ bodies, and that if the MPA was not in fact sterile, it could kill them.
The 25 murder racketeering acts comprise only a portion of the broad racketeering scheme charged in the indictment. The indictment also alleges that NECC’s other pharmacists knowingly made and sold numerous drugs in a similar unsafe manner and in insanitary conditions. The unsafe manner alleged in the indictment includes, among other things, the pharmacists’ failure to properly sterilize NECC’s drugs, failure to properly test NECC’s drugs for sterility, and failure to wait for test results before sending the drugs to customers. The insanitary conditions alleged in the indictment include, among other things, NECC’s lack of proper cleaning and NECC’s failure to take any action when its own environmental monitoring repeatedly detected mold and bacteria within NECC’s clean room suite of rooms throughout 2012.
It is further alleged that NECC repeatedly took steps to shield its operations from regulatory oversight by the FDA by claiming to be a pharmacy dispensing drugs pursuant to valid, patient-specific prescriptions. In fact, NECC routinely dispensed drugs in bulk without valid prescriptions. The indictment alleges that NECC even used fictional and celebrity names on fake prescriptions to dispense drugs.
Finally, the indictment charges Carla Conigliaro, the majority shareholder of NECC, and her husband Douglas Conigliaro with transferring assets following the fungal meningitis outbreak. Specifically, the indictment charges that after NECC declared bankruptcy, and the bankruptcy court ordered the shareholders not to transfer assets, Carla and Doug Conigliaro transferred approximately $33.3 million to eight different bank accounts opened after the NECC bankruptcy.
Cadden and Chin face a maximum of up to life in prison if convicted on all counts.
“Although no VA patients were affected by the fungal meningitis outbreak, VA unknowingly purchased a variety of pharmaceutical products over a three year period from NECC that were intentionally produced in an unsafe manner under insanitary conditions,” said Assistant Inspector General for Investigations James J. O’Neill for the Office of Inspector General, Department of Veterans Affairs. “We are pleased to have contributed to this outstanding multi-agency criminal investigation.”
“Today's results are part of an ongoing effort by the Defense Criminal Investigative Service and its law enforcement partners to protect the integrity of the Department of Defense's health care program and the quality of care our service members receive,” said Deputy Inspector General for Investigations James B. Burch for the U.S. Department of Defense Office of the Inspector General. “The Defense Criminal Investigative Service will continue to pursue allegations of health care fraud that put the Warfighter at risk.”
“The U.S. Postal Inspection Service is pleased to join our federal partners in this announcement” said Postal Inspector in Charge Shelly A. Binkowski of the Boston Division. “What's particularly disturbing about this case is that through their alleged misrepresentation and greed, these defendants put the health and well-being of others at a high level of risk. This criminal action today demonstrates the commitment and vigilance of postal inspectors and other federal agents to pursue criminals who prey on the public in such an egregious way.”
In announcing the indictment today, Attorney General Holder and U.S. Attorney Ortiz acknowledged the assistance and cooperation of Michigan State Attorney General Bill Schuette. The state of Michigan had the most deaths during the outbreak.
The investigation was conducted by the FDA Office of Criminal Investigations and the FBI with assistance by the Defense Criminal Investigative Service, U.S. Department of Defense, Office of Inspector General; Department of Veterans Affairs Office of Inspector General and U.S. Postal Inspection Service. The case is being prosecuted by Assistant U.S. Attorneys George P. Varghese and Amanda P.M. Strachan of the Health Care Fraud Unit for the U.S. Attorney’s Office in the District of Massachusetts, and Trial Attorney John W.M. Claud of the Civil Division’s Consumer Protection Branch.
The details contained in the indictment are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt.
SEC CHARGES AVON PRODUCTS INC. WITH VIOLATING FOREIGN CORRUPT PRACTICES ACT
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
The Securities and Exchange Commission today charged global beauty products company Avon Products Inc. with violating the Foreign Corrupt Practices Act (FCPA) by failing to put controls in place to detect and prevent payments and gifts to Chinese government officials from employees and consultants at a subsidiary.
Avon entities agreed to pay a total of $135 million to settle the SEC’s charges and a parallel case announced today by the U.S. Department of Justice and the U.S. Attorney’s Office for the Southern District of New York.
The SEC alleges that Avon’s subsidiary in China made $8 million worth of payments in cash, gifts, travel, and entertainment to gain access to Chinese officials implementing and overseeing direct selling regulations in China. Avon sought to be among the first allowed to test the regulations, and eventually received the first direct selling business license in China in March 2006. The improper payments also were made to avoid fines or negative news articles that could have impacted Avon’s clean corporate image required to retain the license. Examples of improper payments alleged in the SEC’s complaint include paid travel for Chinese government officials within China or to the U.S. or Europe as well as such gifts as Louis Vuitton merchandise, Gucci bags, Tiffany pens, and corporate box tickets to the China Open tennis tournament.
“Avon’s subsidiary in China paid millions of dollars to government officials to obtain a direct selling license and gain an edge over their competitors, and the company reaped substantial financial benefits as a result,” said Scott W. Friestad, an Associate Director in the SEC’s Division of Enforcement. “Avon missed an opportunity to correct potential FCPA problems at its subsidiary, resulting in years of additional misconduct that could have been avoided.”
According to the SEC’s complaint filed in U.S. District Court for the Southern District of New York, the improper payments occurred from 2004 to 2008. Avon management learned about potential FCPA problems at the subsidiary through an internal audit report in late 2005. Avon management consulted an outside law firm, directed that reforms be instituted at the subsidiary, and sent an internal audit team to follow up. Ultimately, however, no such reforms were instituted at the Chinese subsidiary. Avon finally began a full-blown internal investigation in 2008 after its CEO received a letter from a whistleblower.
The SEC alleges that Avon’s books and records failed to accurately record the details and purpose of the payments. In some instances, payments were concealed by falsely recording the transactions as employee business expenses or as reimbursement of a third-party vendor. In other instances, the records for the payments set forth almost no detail at all. The resulting books and records did not allow a reviewer to ascertain the government official or state-owned entities that received the payments or the purpose for which the payments were made.
The SEC’s complaint charges Avon with violating Sections 13(b)(2)(A) and 13(b)(2)(B) of the Securities Exchange Act of 1934. Avon, which neither admitted nor denied the allegations, agreed to pay disgorgement of $52,850,000 in benefits resulting from the alleged misconduct plus prejudgment interest of $14,515,013.13 for a total of more than $67.36 million. In the parallel criminal matter, Avon entities agreed to pay $67,648,000 in penalties. Avon also is required to retain an independent compliance monitor to review its FCPA compliance program for a period of 18 months, followed by an 18-month period of self-reporting on its compliance efforts. Avon would be permanently enjoined from violating the books and records and internal controls provisions of the federal securities laws. In reaching the proposed settlement, which is subject to court approval, the SEC considered Avon’s cooperation and significant remedial measures.
The SEC’s investigation was conducted by Paul W. Sharratt and Roger Paszamant and supervised by David Frohlich. The SEC appreciates the assistance of the Fraud Section of the Department of Justice, the U.S. Attorney’s Office for the Southern District of New York, and the Federal Bureau of Investigation.
The Securities and Exchange Commission today charged global beauty products company Avon Products Inc. with violating the Foreign Corrupt Practices Act (FCPA) by failing to put controls in place to detect and prevent payments and gifts to Chinese government officials from employees and consultants at a subsidiary.
Avon entities agreed to pay a total of $135 million to settle the SEC’s charges and a parallel case announced today by the U.S. Department of Justice and the U.S. Attorney’s Office for the Southern District of New York.
The SEC alleges that Avon’s subsidiary in China made $8 million worth of payments in cash, gifts, travel, and entertainment to gain access to Chinese officials implementing and overseeing direct selling regulations in China. Avon sought to be among the first allowed to test the regulations, and eventually received the first direct selling business license in China in March 2006. The improper payments also were made to avoid fines or negative news articles that could have impacted Avon’s clean corporate image required to retain the license. Examples of improper payments alleged in the SEC’s complaint include paid travel for Chinese government officials within China or to the U.S. or Europe as well as such gifts as Louis Vuitton merchandise, Gucci bags, Tiffany pens, and corporate box tickets to the China Open tennis tournament.
“Avon’s subsidiary in China paid millions of dollars to government officials to obtain a direct selling license and gain an edge over their competitors, and the company reaped substantial financial benefits as a result,” said Scott W. Friestad, an Associate Director in the SEC’s Division of Enforcement. “Avon missed an opportunity to correct potential FCPA problems at its subsidiary, resulting in years of additional misconduct that could have been avoided.”
According to the SEC’s complaint filed in U.S. District Court for the Southern District of New York, the improper payments occurred from 2004 to 2008. Avon management learned about potential FCPA problems at the subsidiary through an internal audit report in late 2005. Avon management consulted an outside law firm, directed that reforms be instituted at the subsidiary, and sent an internal audit team to follow up. Ultimately, however, no such reforms were instituted at the Chinese subsidiary. Avon finally began a full-blown internal investigation in 2008 after its CEO received a letter from a whistleblower.
The SEC alleges that Avon’s books and records failed to accurately record the details and purpose of the payments. In some instances, payments were concealed by falsely recording the transactions as employee business expenses or as reimbursement of a third-party vendor. In other instances, the records for the payments set forth almost no detail at all. The resulting books and records did not allow a reviewer to ascertain the government official or state-owned entities that received the payments or the purpose for which the payments were made.
The SEC’s complaint charges Avon with violating Sections 13(b)(2)(A) and 13(b)(2)(B) of the Securities Exchange Act of 1934. Avon, which neither admitted nor denied the allegations, agreed to pay disgorgement of $52,850,000 in benefits resulting from the alleged misconduct plus prejudgment interest of $14,515,013.13 for a total of more than $67.36 million. In the parallel criminal matter, Avon entities agreed to pay $67,648,000 in penalties. Avon also is required to retain an independent compliance monitor to review its FCPA compliance program for a period of 18 months, followed by an 18-month period of self-reporting on its compliance efforts. Avon would be permanently enjoined from violating the books and records and internal controls provisions of the federal securities laws. In reaching the proposed settlement, which is subject to court approval, the SEC considered Avon’s cooperation and significant remedial measures.
The SEC’s investigation was conducted by Paul W. Sharratt and Roger Paszamant and supervised by David Frohlich. The SEC appreciates the assistance of the Fraud Section of the Department of Justice, the U.S. Attorney’s Office for the Southern District of New York, and the Federal Bureau of Investigation.
U.S. UN REPRESENTATIVE'S REMARKS ON THE AFRICAN UNION AND ADVANCING PEACE
FROM: U.S. STATE DEPARTMENT
Ambassador David Pressman
Alternate Representative to the UN for Special Political Affairs
New York, NY
December 16, 2014
AS DELIVERED
Thank you, Mr. President. I want to express the United States’ profound condolences to the victims of the horrific Taliban attack on a school in Pakistan. This gruesome attack deliberately targeted Pakistan's – indeed, all of our – most precious and sacred resource: our children. Cowardly and senseless violence like this only increases our resolve to fight terrorism and violent extremism.
Mr. Minister, thank you for being here and convening this important debate. We thank the Secretary-General and High Representative Buyoya for your briefings. Enhancing the partnership between the United Nations and the African Union is critical for advancing peace and security in Africa. From the Central African Republic, to Mali, to Somalia, every improvement in the important partnership between the United Nations and the African Union has very real impacts on regional stability and on security.
The African Union and its member states have demonstrated important leadership in responding to African conflicts through peacekeeping and preventive diplomacy to stop potential conflicts from becoming actual ones.
Peacekeeping, whether it is done by the United Nations or the African Union, or in some cases both, is only as strong as its troop and police contributors. Member states must be willing to contribute the needed troops and resources; and troop contributors must be willing to robustly carry out difficult mandates. We commend the African troop-contributing countries who have answered the call, again and again, to serve in peacekeeping operations and who have demonstrated a commitment to implement their mandates, including the protection of civilians.
While blue-helmeted United Nations peacekeeping is a critically important tool, it is not always the best tool to respond to a particular conflict. That is why so many of us have redoubled our efforts to support regional organizations’ capacity, including the African Union, to launch and support peace operations when they are needed and consistent with the Charter of the United Nations.
The Security Council has a unique role under the United Nations Charter but our decisions and actions should be taken in close consultation with all stakeholders, including member states, regional and sub-regional organizations, potential troop contributors, and decisions related to the deployment of UN or African Union peacekeeping missions must be made on a case-by-case basis, taking into account the unique circumstances of each particular situation. Enhancing the capacity of regional forces to respond is critical, but the ability of regional organizations to deploy peace operations must be seen as a complement to, of course, not a substitute for, the United Nations’ own ability to carry out robust peacekeeping operations.
Mr. President, we continue to be immensely grateful for Africa’s contributions to peacekeeping. In September of this year, Vice President Biden joined other leaders at a summit focused on generating new commitments to peacekeeping to ensure that the whole of the international community does more to share the burden.
We have made demonstrable progress in our cooperative efforts to deploy troops quickly to crisis areas when the need arises, but we are still too slow. Delay in our crisis response often means more unnecessary deaths. To be quicker and better, we must work more closely and collaboratively. That is why the United States is committed to improving the Security Council’s engagement with the African Union Peace and Security Council.
And in our effort to do better, to do more, and to do so more quickly, we should learn from the past. The recent transitions from African Union-led peacekeeping operations to United Nations-led operations in Mali and the Central African Republic demonstrate once again that the African Union is sometimes in a position to deploy troops to trouble spots much more quickly than others. Without the initial leadership of the AU and contributions of African, French, and other European troops in Mali and Central African Republic, far more civilians would have died over the past year in both countries.
This is why the United States has created the African Peacekeeping Rapid Response Partnership, which envisions a new investment of $110 million per year for 3-5 years to build the capacity of African forces to rapidly deploy peacekeepers in response to emerging conflict. Under this program, African partner nations will receive additional support and will commit to maintaining forces and equipment ready to rapidly deploy as part of UN or AU missions to respond to emerging crises.
The United States is also prepared to provide additional support, including training for headquarters staff and key enabler functions, such as engineers, to catalyze the AU’s efforts to establish its African Capacity for Immediate Response to Crisis, which is intended to facilitate the deployment of tactical battle groups of approximately 1,500 military personnel deployed by a lead nation or group of AU member states.
There has been some discussion today about the financing of peacekeeping operations. In order to be effective, peacekeeping operations must be accountable. And they must be accountable to the organization that has authorized and funded it. That is why we do not support assessing UN member states for the expenses of regional organizations. Such arrangements do not allow the United Nations to exercise critical and, indeed, essential oversight of complex operational undertakings.
However, it is also why we continue to champion and invest heavily in support for AU operations through voluntary contributions and bilateral assistance. Since 2009, the United States has committed to provide nearly $892 million to develop African peacekeeping capacity and strengthen African institutions.
Most recently, in 2013, the United States committed nearly $200 million toward training, equipping, sustaining, and airlifting African peacekeepers of the African-led International Support Mission in Mali. In the Central African Republic, we provided critical equipment and airlift to both the AU troops and French forces operating alongside them. And in Somalia, we have obligated more than $680 million to AMISOM on top of the more than $455 million in UN-assessed contributions for UNSOA that are attributable to the United States. Other partners such as the EU, through its African Peace Facility, have similarly provided very robust support, and we look for other partners doing the same.
In closing, I want to reiterate the depth of my government’s commitment to strengthening African responses to crises on the continent both bilaterally and through this Council.
Today, there are more than 67,000 African peacekeepers serving with the African Union and United Nations in Africa. Their contributions to peace cannot be overstated. They deserve more support from all of us to train, equip, and enable their deployment.
As President Obama said during our U.S.-Africa Leaders’ Summit held in August, “the United States is determined to be a partner in Africa’s success – a good partner, an equal partner, and a partner for the long term.”
I thank you, Mr. President.
Ambassador David Pressman
Alternate Representative to the UN for Special Political Affairs
New York, NY
December 16, 2014
AS DELIVERED
Thank you, Mr. President. I want to express the United States’ profound condolences to the victims of the horrific Taliban attack on a school in Pakistan. This gruesome attack deliberately targeted Pakistan's – indeed, all of our – most precious and sacred resource: our children. Cowardly and senseless violence like this only increases our resolve to fight terrorism and violent extremism.
Mr. Minister, thank you for being here and convening this important debate. We thank the Secretary-General and High Representative Buyoya for your briefings. Enhancing the partnership between the United Nations and the African Union is critical for advancing peace and security in Africa. From the Central African Republic, to Mali, to Somalia, every improvement in the important partnership between the United Nations and the African Union has very real impacts on regional stability and on security.
The African Union and its member states have demonstrated important leadership in responding to African conflicts through peacekeeping and preventive diplomacy to stop potential conflicts from becoming actual ones.
Peacekeeping, whether it is done by the United Nations or the African Union, or in some cases both, is only as strong as its troop and police contributors. Member states must be willing to contribute the needed troops and resources; and troop contributors must be willing to robustly carry out difficult mandates. We commend the African troop-contributing countries who have answered the call, again and again, to serve in peacekeeping operations and who have demonstrated a commitment to implement their mandates, including the protection of civilians.
While blue-helmeted United Nations peacekeeping is a critically important tool, it is not always the best tool to respond to a particular conflict. That is why so many of us have redoubled our efforts to support regional organizations’ capacity, including the African Union, to launch and support peace operations when they are needed and consistent with the Charter of the United Nations.
The Security Council has a unique role under the United Nations Charter but our decisions and actions should be taken in close consultation with all stakeholders, including member states, regional and sub-regional organizations, potential troop contributors, and decisions related to the deployment of UN or African Union peacekeeping missions must be made on a case-by-case basis, taking into account the unique circumstances of each particular situation. Enhancing the capacity of regional forces to respond is critical, but the ability of regional organizations to deploy peace operations must be seen as a complement to, of course, not a substitute for, the United Nations’ own ability to carry out robust peacekeeping operations.
Mr. President, we continue to be immensely grateful for Africa’s contributions to peacekeeping. In September of this year, Vice President Biden joined other leaders at a summit focused on generating new commitments to peacekeeping to ensure that the whole of the international community does more to share the burden.
We have made demonstrable progress in our cooperative efforts to deploy troops quickly to crisis areas when the need arises, but we are still too slow. Delay in our crisis response often means more unnecessary deaths. To be quicker and better, we must work more closely and collaboratively. That is why the United States is committed to improving the Security Council’s engagement with the African Union Peace and Security Council.
And in our effort to do better, to do more, and to do so more quickly, we should learn from the past. The recent transitions from African Union-led peacekeeping operations to United Nations-led operations in Mali and the Central African Republic demonstrate once again that the African Union is sometimes in a position to deploy troops to trouble spots much more quickly than others. Without the initial leadership of the AU and contributions of African, French, and other European troops in Mali and Central African Republic, far more civilians would have died over the past year in both countries.
This is why the United States has created the African Peacekeeping Rapid Response Partnership, which envisions a new investment of $110 million per year for 3-5 years to build the capacity of African forces to rapidly deploy peacekeepers in response to emerging conflict. Under this program, African partner nations will receive additional support and will commit to maintaining forces and equipment ready to rapidly deploy as part of UN or AU missions to respond to emerging crises.
The United States is also prepared to provide additional support, including training for headquarters staff and key enabler functions, such as engineers, to catalyze the AU’s efforts to establish its African Capacity for Immediate Response to Crisis, which is intended to facilitate the deployment of tactical battle groups of approximately 1,500 military personnel deployed by a lead nation or group of AU member states.
There has been some discussion today about the financing of peacekeeping operations. In order to be effective, peacekeeping operations must be accountable. And they must be accountable to the organization that has authorized and funded it. That is why we do not support assessing UN member states for the expenses of regional organizations. Such arrangements do not allow the United Nations to exercise critical and, indeed, essential oversight of complex operational undertakings.
However, it is also why we continue to champion and invest heavily in support for AU operations through voluntary contributions and bilateral assistance. Since 2009, the United States has committed to provide nearly $892 million to develop African peacekeeping capacity and strengthen African institutions.
Most recently, in 2013, the United States committed nearly $200 million toward training, equipping, sustaining, and airlifting African peacekeepers of the African-led International Support Mission in Mali. In the Central African Republic, we provided critical equipment and airlift to both the AU troops and French forces operating alongside them. And in Somalia, we have obligated more than $680 million to AMISOM on top of the more than $455 million in UN-assessed contributions for UNSOA that are attributable to the United States. Other partners such as the EU, through its African Peace Facility, have similarly provided very robust support, and we look for other partners doing the same.
In closing, I want to reiterate the depth of my government’s commitment to strengthening African responses to crises on the continent both bilaterally and through this Council.
Today, there are more than 67,000 African peacekeepers serving with the African Union and United Nations in Africa. Their contributions to peace cannot be overstated. They deserve more support from all of us to train, equip, and enable their deployment.
As President Obama said during our U.S.-Africa Leaders’ Summit held in August, “the United States is determined to be a partner in Africa’s success – a good partner, an equal partner, and a partner for the long term.”
I thank you, Mr. President.
SCIENTIST STUDYING ECONOMIC IMPACT OF INFECTIOUS DISEASES
FROM: NATIONAL SCIENCE FOUNDATION
Ebola, Dengue fever, Lyme disease: The growing economic cost of infectious diseases
Five new such diseases expected each year; strategies to reduce climate change adaptable to infectious diseases.
Emerging pandemic disease outbreaks such as Ebola increasingly threaten global public health and world economies, scientists say. We can expect five new such diseases each year, into the future.
And expect them to spread. The tropical disease dengue fever, for example, has made its way to Florida and Texas, seemingly to stay.
But the global response to infectious diseases is often too late to prevent major effects on health and economic growth, researchers believe.
According to the World Health Organization (WHO), the number of people infected with Ebola has surpassed 17,000, with more than 6,000 deaths. The World Bank now estimates that the two-year financial cost of Ebola may reach $32.6 billion and force some already suffering West African economies into a deep recession.
Growing economic cost of global disease outbreaks
Scientists at EcoHealth Alliance in New York and other organizations studied the economic cost of such global disease outbreaks.
Economists, disease ecologists and others collaborated on an in-depth economic analysis of strategies to address pandemic threats in a proactive way--rather than a reactive response to a crisis. The results are published in this week's issue of the journal Proceedings of the National Academy of Sciences (PNAS).
"Our research shows that new approaches to reducing emerging pandemic threats at the source would be more cost-effective than trying to mobilize a global response after a disease has emerged," says Peter Daszak, senior author of the paper and president of EcoHealth Alliance.
The researchers used economic modeling to analyze two strategies for a pandemic response: Current business-as-usual approaches that rely on global surveillance to identify new diseases in people, and new "mitigation" strategies to reduce the underlying drivers of emerging diseases and lower the risk of their emergence.
"Our economic modeling demonstrates that the new approach to dealing with disease emergence is the right strategy in the long-term," says Jamie Pike, an economist at EcoHealth Alliance and first author of the paper.
The results indicate that the strategy for pandemics needs to be coordinated on a global scale to be effective in reducing risk. And that mitigation strategies will be far more cost-effective in the long-term.
The results follow those reported in a September, 2014, paper in the journal EcoHealth, in which Daszak, Charles Perrings of Arizona State University, A. Marm Kilpatrick of the University of California at Santa Cruz, and colleagues show that economic epidemiology has the potential to improve predictions of the course of infectious diseases, and to support new approaches to management of such diseases.
Environmental change causing increase in number of new diseases
Ebola. West Nile virus. Lyme disease. All are infectious diseases spreading in animals, and in humans. Is our interaction with the environment somehow responsible for the increase in incidence of these diseases?
With 60 percent of all human diseases and 75 percent of all emerging infectious diseases involving animal-to-human transmission, the underlying factors that contribute to disease outbreaks are mostly related to environmental changes to global ecosystems, the scientists found. Deforestation and illegal wildlife trade are two culprits.
Large-scale environmental events alter the risks of emergence of viral, parasitic and bacterial diseases in humans and animals.
"Virtually all the world's terrestrial and aquatic communities have undergone dramatic changes in biodiversity due primarily to habitat transformations such as deforestation and agricultural intensification, invasions of exotic species, chemical contamination, and climate change events," says Sam Scheiner, National Science Foundation (NSF) program director for the joint NSF-NIH-USDA Ecology and Evolution of Infectious Diseases (EEID) Program, which funded the research.
Ebola epidemic highlights need to address infectious disease threats
"The current Ebola epidemic highlights the need to anticipate possible health threats from these changes," says Scheiner. "This study shows that the long-term economic benefits outweigh the short-term costs, not to mention the human benefits of preventing the next pandemic."
Rapid changes to the environment are resulting in a continuous year-by-year increase in the number of new diseases emerging, the researchers found.
"With continued pressure causing diseases to rise, we need to analyze the ecological and economic foundations of the risk, and identify economically effective strategies to reduce it," says David Finnoff, an economist at the University of Wyoming and co-author of the PNAS paper.
The paper highlights WHO International Health Regulations goals, and points out that the global capacity to achieve such targets needs to be addressed to deal with the continuous rise in the rate of new diseases.
Five new diseases each year into the future
"We show that we can expect more than five new emerging diseases each year into the future," says Daszak.
"With this continuous rise in the pandemic threat, and our increasing global connectivity, we are at a critical moment in history to act."
-- Cheryl Dybas, NSF
Ebola, Dengue fever, Lyme disease: The growing economic cost of infectious diseases
Five new such diseases expected each year; strategies to reduce climate change adaptable to infectious diseases.
Emerging pandemic disease outbreaks such as Ebola increasingly threaten global public health and world economies, scientists say. We can expect five new such diseases each year, into the future.
And expect them to spread. The tropical disease dengue fever, for example, has made its way to Florida and Texas, seemingly to stay.
But the global response to infectious diseases is often too late to prevent major effects on health and economic growth, researchers believe.
According to the World Health Organization (WHO), the number of people infected with Ebola has surpassed 17,000, with more than 6,000 deaths. The World Bank now estimates that the two-year financial cost of Ebola may reach $32.6 billion and force some already suffering West African economies into a deep recession.
Growing economic cost of global disease outbreaks
Scientists at EcoHealth Alliance in New York and other organizations studied the economic cost of such global disease outbreaks.
Economists, disease ecologists and others collaborated on an in-depth economic analysis of strategies to address pandemic threats in a proactive way--rather than a reactive response to a crisis. The results are published in this week's issue of the journal Proceedings of the National Academy of Sciences (PNAS).
"Our research shows that new approaches to reducing emerging pandemic threats at the source would be more cost-effective than trying to mobilize a global response after a disease has emerged," says Peter Daszak, senior author of the paper and president of EcoHealth Alliance.
The researchers used economic modeling to analyze two strategies for a pandemic response: Current business-as-usual approaches that rely on global surveillance to identify new diseases in people, and new "mitigation" strategies to reduce the underlying drivers of emerging diseases and lower the risk of their emergence.
"Our economic modeling demonstrates that the new approach to dealing with disease emergence is the right strategy in the long-term," says Jamie Pike, an economist at EcoHealth Alliance and first author of the paper.
The results indicate that the strategy for pandemics needs to be coordinated on a global scale to be effective in reducing risk. And that mitigation strategies will be far more cost-effective in the long-term.
The results follow those reported in a September, 2014, paper in the journal EcoHealth, in which Daszak, Charles Perrings of Arizona State University, A. Marm Kilpatrick of the University of California at Santa Cruz, and colleagues show that economic epidemiology has the potential to improve predictions of the course of infectious diseases, and to support new approaches to management of such diseases.
Environmental change causing increase in number of new diseases
Ebola. West Nile virus. Lyme disease. All are infectious diseases spreading in animals, and in humans. Is our interaction with the environment somehow responsible for the increase in incidence of these diseases?
With 60 percent of all human diseases and 75 percent of all emerging infectious diseases involving animal-to-human transmission, the underlying factors that contribute to disease outbreaks are mostly related to environmental changes to global ecosystems, the scientists found. Deforestation and illegal wildlife trade are two culprits.
Large-scale environmental events alter the risks of emergence of viral, parasitic and bacterial diseases in humans and animals.
"Virtually all the world's terrestrial and aquatic communities have undergone dramatic changes in biodiversity due primarily to habitat transformations such as deforestation and agricultural intensification, invasions of exotic species, chemical contamination, and climate change events," says Sam Scheiner, National Science Foundation (NSF) program director for the joint NSF-NIH-USDA Ecology and Evolution of Infectious Diseases (EEID) Program, which funded the research.
Ebola epidemic highlights need to address infectious disease threats
"The current Ebola epidemic highlights the need to anticipate possible health threats from these changes," says Scheiner. "This study shows that the long-term economic benefits outweigh the short-term costs, not to mention the human benefits of preventing the next pandemic."
Rapid changes to the environment are resulting in a continuous year-by-year increase in the number of new diseases emerging, the researchers found.
"With continued pressure causing diseases to rise, we need to analyze the ecological and economic foundations of the risk, and identify economically effective strategies to reduce it," says David Finnoff, an economist at the University of Wyoming and co-author of the PNAS paper.
The paper highlights WHO International Health Regulations goals, and points out that the global capacity to achieve such targets needs to be addressed to deal with the continuous rise in the rate of new diseases.
Five new diseases each year into the future
"We show that we can expect more than five new emerging diseases each year into the future," says Daszak.
"With this continuous rise in the pandemic threat, and our increasing global connectivity, we are at a critical moment in history to act."
-- Cheryl Dybas, NSF
FORMER BOARD CHAIRMAN TO PAY OVER $378,000 TO SETTLE SEC CHARGES OF INSIDER TRADING
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23153 / December 9, 2014
Securities and Exchange Commission v. George H. Holley, et al., Civil Action No. 3:11-cv-00205-MLC-DEA (D.N.J.) filed January 13, 2011; Securities and Exchange Commissionv. Robert J. Hahn-Baiyor, Case No. 3:14-cv-07631-JAP-TJB (D.N.J.) filed December 8, 2014
The Securities and Exchange Commission announced today that on December 8, 2014, the Honorable Douglas E. Arpert of the United States District Court for the District of New Jersey entered a final judgment against defendant George H. Holley, the former Chairman of the Board of Directors of Home Diagnostics, Inc. The final judgment permanently enjoins Holley from violating certain antifraud provisions of the federal securities laws, permanently bars him from acting as an officer or director of a public company, and orders him to pay disgorgement of $66,100 plus prejudgment interest thereon, and a civil penalty in the amount of $312,440.
In its Complaint, the SEC alleged that, in 2010, Holley, who co-founded Home Diagnostics, tipped six of his friends, relatives, and employees with confidential information about the impending acquisition of Home Diagnostics by Nipro Corporation. Each of the tippees subsequently purchased HDI stock on the basis of Holley's tips and, following the public announcement of the acquisition, sold their HDI shares for a combined profit of over $260,000.
On August 8, 2012, Holley pleaded guilty to federal criminal charges of securities fraud in a parallel criminal action before the District Court for the District of New Jersey in United States v. George H. Holley, Crim. No. 11-0066-JAP (D.N.J.). On December 18, 2012, Holley was sentenced to three years of probation and fined $260,000.
The final judgment permanently enjoins Holley from future violations of Sections 10(b) and 14(e) of the Securities Exchange Act of 1934 and Rules 10b-5 and 14e-3 thereunder, the general antifraud and tender offer fraud provisions of the federal securities laws. In addition, the judgment against Holley permanently bars him from acting as an officer or director of a public company, and orders him to pay disgorgement of $66,100, plus prejudgment interest thereon, and a civil penalty in the amount of $312,440. Holley consented to the entry of the final judgment.
The Commission also announced today charges against Holley's first-cousin, Robert J. Hahn-Baiyor, for trading on the basis of inside information about the impending acquisition of Home Diagnostics that was tipped to him by Holley. In a Complaint filed in the United States District Court for the District of New Jersey, the SEC alleges that Hahn-Baiyor violated Sections 10(b) and 14(e) of the Securities Exchange Act of 1934 and Rules 10b-5 and 14e-3 thereunder,. Without admitting or denying the allegations in the SEC's Complaint against him, Hahn-Baiyor has consented to the entry of a final judgment that permanently enjoins him from future violations of the provisions of the federal securities laws that he is alleged to have violated and requires him to pay a civil penalty of $66,100. Hahn-Baiyor's settlement is subject to approval by the Court.
This concludes the litigation in SEC v. Holley. Previously, the court in SEC v. Holley had entered final judgments against co-defendants Steven V. Dudas and Phairot Iamnaita. In addition, on May 6, 2014, the Commission filed civil injunctive actions against three other tippees of Holley - John Campani, John Mullin, and Alan Posner - each of whom subsequently consented to the entry of final judgments ordering injunctive and monetary relief.
The SEC thanks the U.S. Attorney's Office for the District of New Jersey, the Federal Bureau of Investigation, and FINRA, for their cooperation and assistance in this matter.
Wednesday, December 17, 2014
WHITE HOUSE FACT SHEET ON CHANGING RELATIONS WITH CUBA
FROM: THE WHITE HOUSE
December 17, 2014
FACT SHEET: Charting a New Course on Cuba
Today, the United States is taking historic steps to chart a new course in our relations with Cuba and to further engage and empower the Cuban people. We are separated by 90 miles of water, but brought together through the relationships between the two million Cubans and Americans of Cuban descent that live in the United States, and the 11 million Cubans who share similar hopes for a more positive future for Cuba.
It is clear that decades of U.S. isolation of Cuba have failed to accomplish our enduring objective of promoting the emergence of a democratic, prosperous, and stable Cuba. At times, longstanding U.S. policy towards Cuba has isolated the United States from regional and international partners, constrained our ability to influence outcomes throughout the Western Hemisphere, and impaired the use of the full range of tools available to the United States to promote positive change in Cuba. Though this policy has been rooted in the best of intentions, it has had little effect – today, as in 1961, Cuba is governed by the Castros and the Communist party.
We cannot keep doing the same thing and expect a different result. It does not serve America’s interests, or the Cuban people, to try to push Cuba toward collapse. We know from hard-learned experience that it is better to encourage and support reform than to impose policies that will render a country a failed state. With our actions today, we are calling on Cuba to unleash the potential of 11 million Cubans by ending unnecessary restrictions on their political, social, and economic activities. In that spirit, we should not allow U.S. sanctions to add to the burden of Cuban citizens we seek to help.
Today, we are renewing our leadership in the Americas. We are choosing to cut loose the anchor of the past, because it is entirely necessary to reach a better future – for our national interests, for the American people, and for the Cuban people.
Key Components of the Updated Policy Approach:
Since taking office in 2009, President Obama has taken steps aimed at supporting the ability of the Cuban people to gain greater control over their own lives and determine their country’s future. Today, the President announced additional measures to end our outdated approach, and to promote more effectively change in Cuba that is consistent with U.S. support for the Cuban people and in line with U.S. national security interests. Major elements of the President’s new approach include:
Establishing diplomatic relations with Cuba-
The President has instructed the Secretary of State to immediately initiate discussions with Cuba on the re-establishment of diplomatic relations with Cuba, which were severed in January 1961.
In the coming months, we will re-establish an embassy in Havana and carry out high-level exchanges and visits between our two governments as part of the normalization process. As an initial step, the Assistant Secretary of State for Western Hemisphere Affairs will lead the U.S. Delegation to the next round of U.S.-Cuba Migration Talks in January 2015, in Havana.
U.S. engagement will be critical when appropriate and will include continued strong support for improved human rights conditions and democratic reforms in Cuba and other measures aimed at fostering improved conditions for the Cuban people.
The United States will work with Cuba on matters of mutual concern and that advance U.S. national interests, such as migration, counternarcotics, environmental protection, and trafficking in persons, among other issues.
Adjusting regulations to more effectively empower the Cuban people-
The changes announced today will soon be implemented via amendments to regulations of the Departments of the Treasury and Commerce. Our new policy changes will further enhance our goal of empowering the Cuban population.
Our travel and remittance policies are helping Cubans by providing alternative sources of information and opportunities for self-employment and private property ownership, and by strengthening independent civil society.
These measures will further increase people-to-people contact; further support civil society in Cuba; and further enhance the free flow of information to, from, and among the Cuban people. Persons must comply with all provisions of the revised regulations; violations of the terms and conditions are enforceable under U.S. law.
Facilitating an expansion of travel under general licenses for the 12 existing categories of travel to Cuba authorized by law-
General licenses will be made available for all authorized travelers in the following existing categories: (1) family visits; (2) official business of the U.S. government, foreign governments, and certain intergovernmental organizations; (3) journalistic activity; (4) professional research and professional meetings; (5) educational activities; (6) religious activities; (7) public performances, clinics, workshops, athletic and other competitions, and exhibitions; (8) support for the Cuban people; (9) humanitarian projects; (10) activities of private foundations or research or educational institutes; (11) exportation, importation, or transmission of information or information materials; and (12) certain export transactions that may be considered for authorization under existing regulations and guidelines.
Travelers in the 12 categories of travel to Cuba authorized by law will be able to make arrangements through any service provider that complies with the U.S. Treasury’s Office of Foreign Assets Control (OFAC) regulations governing travel services to Cuba, and general licenses will authorize provision of such services.
The policy changes make it easier for Americans to provide business training for private Cuban businesses and small farmers and provide other support for the growth of Cuba’s nascent private sector. Additional options for promoting the growth of entrepreneurship and the private sector in Cuba will be explored.
Facilitating remittances to Cuba by U.S. persons-
Remittance levels will be raised from $500 to $2,000 per quarter for general donative remittances to Cuban nationals (except to certain officials of the government or the Communist party); and donative remittances for humanitarian projects, support for the Cuban people, and support for the development of private businesses in Cuba will no longer require a specific license.
Remittance forwarders will no longer require a specific license.
Authorizing expanded commercial sales/exports from the United States of certain goods and services-
The expansion will seek to empower the nascent Cuban private sector. Items that will be authorized for export include certain building materials for private residential construction, goods for use by private sector Cuban entrepreneurs, and agricultural equipment for small farmers. This change will make it easier for Cuban citizens to have access to certain lower-priced goods to improve their living standards and gain greater economic independence from the state.
Authorizing American citizens to import additional goods from Cuba-
Licensed U.S. travelers to Cuba will be authorized to import $400 worth of goods from Cuba, of which no more than $100 can consist of tobacco products and alcohol combined.
Facilitating authorized transactions between the United States and Cuba-
U.S. institutions will be permitted to open correspondent accounts at Cuban financial institutions to facilitate the processing of authorized transactions.
The regulatory definition of the statutory term “cash in advance” will be revised to specify that it means “cash before transfer of title”; this will provide more efficient financing of authorized trade with Cuba.
U.S. credit and debit cards will be permitted for use by travelers to Cuba.
These measures will improve the speed, efficiency, and oversight of authorized payments between the United States and Cuba.
Initiating new efforts to increase Cubans’ access to communications and their ability to communicate freely-
Cuba has an internet penetration of about five percent—one of the lowest rates in the world. The cost of telecommunications in Cuba is exorbitantly high, while the services offered are extremely limited.
The commercial export of certain items that will contribute to the ability of the Cuban people to communicate with people in the United States and the rest of the world will be authorized. This will include the commercial sale of certain consumer communications devices, related software, applications, hardware, and services, and items for the establishment and update of communications-related systems.
Telecommunications providers will be allowed to establish the necessary mechanisms, including infrastructure, in Cuba to provide commercial telecommunications and internet services, which will improve telecommunications between the United States and Cuba.
Updating the application of Cuba sanctions in third countries-
U.S.-owned or -controlled entities in third countries will be generally licensed to provide services to, and engage in financial transactions with, Cuban individuals in third countries. In addition, general licenses will unblock the accounts at U.S. banks of Cuban nationals who have relocated outside of Cuba; permit U.S. persons to participate in third-country professional meetings and conferences related to Cuba; and, allow foreign vessels to enter the United States after engaging in certain humanitarian trade with Cuba, among other measures.
Pursuing discussions with the Cuban and Mexican governments to discuss our unresolved maritime boundary in the Gulf of Mexico-
Previous agreements between the United States and Cuba delimit the maritime space between the two countries within 200 nautical miles from shore. The United States, Cuba, and Mexico have extended continental shelf in an area within the Gulf of Mexico where the three countries have not yet delimited any boundaries.
The United States is prepared to invite the governments of Cuba and Mexico to discuss shared maritime boundaries in the Gulf of Mexico.
Initiating a review of Cuba’s designation as a State Sponsor of Terrorism-
The President has instructed the Secretary of State to immediately launch such a review, and provide a report to the President within six months regarding Cuba’s support for international terrorism. Cuba was placed on the list in 1982.
Addressing Cuba’s participation in the 2015 Summit of the Americas in Panama-
President Obama will participate in the Summit of the Americas in Panama. Human rights and democracy will be key Summit themes. Cuban civil society must be allowed to participate along with civil society from other countries participating in the Summit, consistent with the region’s commitments under the Inter-American Democratic Charter. The United States welcomes a constructive dialogue among Summit governments on the Summit’s principles.
Unwavering Commitment to Democracy, Human Rights, and Civil Society
A critical focus of our increased engagement will include continued strong support by the United States for improved human rights conditions and democratic reforms in Cuba. The promotion of democracy supports universal human rights by empowering civil society and a person’s right to speak freely, peacefully assemble, and associate, and by supporting the ability of people to freely determine their future. Our efforts are aimed at promoting the independence of the Cuban people so they do not need to rely on the Cuban state.
The U.S. Congress funds democracy programming in Cuba to provide humanitarian assistance, promote human rights and fundamental freedoms, and support the free flow of information in places where it is restricted and censored. The Administration will continue to implement U.S. programs aimed at promoting positive change in Cuba, and we will encourage reforms in our high level engagement with Cuban officials.
The United States encourages all nations and organizations engaged in diplomatic dialogue with the Cuban government to take every opportunity both publicly and privately to support increased respect for human rights and fundamental freedoms in Cuba.
Ultimately, it will be the Cuban people who drive economic and political reforms. That is why President Obama took steps to increase the flow of resources and information to ordinary Cuban citizens in 2009, 2011, and today. The Cuban people deserve the support of the United States and of an entire region that has committed to promote and defend democracy through the Inter-American Democratic Charter.
December 17, 2014
FACT SHEET: Charting a New Course on Cuba
Today, the United States is taking historic steps to chart a new course in our relations with Cuba and to further engage and empower the Cuban people. We are separated by 90 miles of water, but brought together through the relationships between the two million Cubans and Americans of Cuban descent that live in the United States, and the 11 million Cubans who share similar hopes for a more positive future for Cuba.
It is clear that decades of U.S. isolation of Cuba have failed to accomplish our enduring objective of promoting the emergence of a democratic, prosperous, and stable Cuba. At times, longstanding U.S. policy towards Cuba has isolated the United States from regional and international partners, constrained our ability to influence outcomes throughout the Western Hemisphere, and impaired the use of the full range of tools available to the United States to promote positive change in Cuba. Though this policy has been rooted in the best of intentions, it has had little effect – today, as in 1961, Cuba is governed by the Castros and the Communist party.
We cannot keep doing the same thing and expect a different result. It does not serve America’s interests, or the Cuban people, to try to push Cuba toward collapse. We know from hard-learned experience that it is better to encourage and support reform than to impose policies that will render a country a failed state. With our actions today, we are calling on Cuba to unleash the potential of 11 million Cubans by ending unnecessary restrictions on their political, social, and economic activities. In that spirit, we should not allow U.S. sanctions to add to the burden of Cuban citizens we seek to help.
Today, we are renewing our leadership in the Americas. We are choosing to cut loose the anchor of the past, because it is entirely necessary to reach a better future – for our national interests, for the American people, and for the Cuban people.
Key Components of the Updated Policy Approach:
Since taking office in 2009, President Obama has taken steps aimed at supporting the ability of the Cuban people to gain greater control over their own lives and determine their country’s future. Today, the President announced additional measures to end our outdated approach, and to promote more effectively change in Cuba that is consistent with U.S. support for the Cuban people and in line with U.S. national security interests. Major elements of the President’s new approach include:
Establishing diplomatic relations with Cuba-
The President has instructed the Secretary of State to immediately initiate discussions with Cuba on the re-establishment of diplomatic relations with Cuba, which were severed in January 1961.
In the coming months, we will re-establish an embassy in Havana and carry out high-level exchanges and visits between our two governments as part of the normalization process. As an initial step, the Assistant Secretary of State for Western Hemisphere Affairs will lead the U.S. Delegation to the next round of U.S.-Cuba Migration Talks in January 2015, in Havana.
U.S. engagement will be critical when appropriate and will include continued strong support for improved human rights conditions and democratic reforms in Cuba and other measures aimed at fostering improved conditions for the Cuban people.
The United States will work with Cuba on matters of mutual concern and that advance U.S. national interests, such as migration, counternarcotics, environmental protection, and trafficking in persons, among other issues.
Adjusting regulations to more effectively empower the Cuban people-
The changes announced today will soon be implemented via amendments to regulations of the Departments of the Treasury and Commerce. Our new policy changes will further enhance our goal of empowering the Cuban population.
Our travel and remittance policies are helping Cubans by providing alternative sources of information and opportunities for self-employment and private property ownership, and by strengthening independent civil society.
These measures will further increase people-to-people contact; further support civil society in Cuba; and further enhance the free flow of information to, from, and among the Cuban people. Persons must comply with all provisions of the revised regulations; violations of the terms and conditions are enforceable under U.S. law.
Facilitating an expansion of travel under general licenses for the 12 existing categories of travel to Cuba authorized by law-
General licenses will be made available for all authorized travelers in the following existing categories: (1) family visits; (2) official business of the U.S. government, foreign governments, and certain intergovernmental organizations; (3) journalistic activity; (4) professional research and professional meetings; (5) educational activities; (6) religious activities; (7) public performances, clinics, workshops, athletic and other competitions, and exhibitions; (8) support for the Cuban people; (9) humanitarian projects; (10) activities of private foundations or research or educational institutes; (11) exportation, importation, or transmission of information or information materials; and (12) certain export transactions that may be considered for authorization under existing regulations and guidelines.
Travelers in the 12 categories of travel to Cuba authorized by law will be able to make arrangements through any service provider that complies with the U.S. Treasury’s Office of Foreign Assets Control (OFAC) regulations governing travel services to Cuba, and general licenses will authorize provision of such services.
The policy changes make it easier for Americans to provide business training for private Cuban businesses and small farmers and provide other support for the growth of Cuba’s nascent private sector. Additional options for promoting the growth of entrepreneurship and the private sector in Cuba will be explored.
Facilitating remittances to Cuba by U.S. persons-
Remittance levels will be raised from $500 to $2,000 per quarter for general donative remittances to Cuban nationals (except to certain officials of the government or the Communist party); and donative remittances for humanitarian projects, support for the Cuban people, and support for the development of private businesses in Cuba will no longer require a specific license.
Remittance forwarders will no longer require a specific license.
Authorizing expanded commercial sales/exports from the United States of certain goods and services-
The expansion will seek to empower the nascent Cuban private sector. Items that will be authorized for export include certain building materials for private residential construction, goods for use by private sector Cuban entrepreneurs, and agricultural equipment for small farmers. This change will make it easier for Cuban citizens to have access to certain lower-priced goods to improve their living standards and gain greater economic independence from the state.
Authorizing American citizens to import additional goods from Cuba-
Licensed U.S. travelers to Cuba will be authorized to import $400 worth of goods from Cuba, of which no more than $100 can consist of tobacco products and alcohol combined.
Facilitating authorized transactions between the United States and Cuba-
U.S. institutions will be permitted to open correspondent accounts at Cuban financial institutions to facilitate the processing of authorized transactions.
The regulatory definition of the statutory term “cash in advance” will be revised to specify that it means “cash before transfer of title”; this will provide more efficient financing of authorized trade with Cuba.
U.S. credit and debit cards will be permitted for use by travelers to Cuba.
These measures will improve the speed, efficiency, and oversight of authorized payments between the United States and Cuba.
Initiating new efforts to increase Cubans’ access to communications and their ability to communicate freely-
Cuba has an internet penetration of about five percent—one of the lowest rates in the world. The cost of telecommunications in Cuba is exorbitantly high, while the services offered are extremely limited.
The commercial export of certain items that will contribute to the ability of the Cuban people to communicate with people in the United States and the rest of the world will be authorized. This will include the commercial sale of certain consumer communications devices, related software, applications, hardware, and services, and items for the establishment and update of communications-related systems.
Telecommunications providers will be allowed to establish the necessary mechanisms, including infrastructure, in Cuba to provide commercial telecommunications and internet services, which will improve telecommunications between the United States and Cuba.
Updating the application of Cuba sanctions in third countries-
U.S.-owned or -controlled entities in third countries will be generally licensed to provide services to, and engage in financial transactions with, Cuban individuals in third countries. In addition, general licenses will unblock the accounts at U.S. banks of Cuban nationals who have relocated outside of Cuba; permit U.S. persons to participate in third-country professional meetings and conferences related to Cuba; and, allow foreign vessels to enter the United States after engaging in certain humanitarian trade with Cuba, among other measures.
Pursuing discussions with the Cuban and Mexican governments to discuss our unresolved maritime boundary in the Gulf of Mexico-
Previous agreements between the United States and Cuba delimit the maritime space between the two countries within 200 nautical miles from shore. The United States, Cuba, and Mexico have extended continental shelf in an area within the Gulf of Mexico where the three countries have not yet delimited any boundaries.
The United States is prepared to invite the governments of Cuba and Mexico to discuss shared maritime boundaries in the Gulf of Mexico.
Initiating a review of Cuba’s designation as a State Sponsor of Terrorism-
The President has instructed the Secretary of State to immediately launch such a review, and provide a report to the President within six months regarding Cuba’s support for international terrorism. Cuba was placed on the list in 1982.
Addressing Cuba’s participation in the 2015 Summit of the Americas in Panama-
President Obama will participate in the Summit of the Americas in Panama. Human rights and democracy will be key Summit themes. Cuban civil society must be allowed to participate along with civil society from other countries participating in the Summit, consistent with the region’s commitments under the Inter-American Democratic Charter. The United States welcomes a constructive dialogue among Summit governments on the Summit’s principles.
Unwavering Commitment to Democracy, Human Rights, and Civil Society
A critical focus of our increased engagement will include continued strong support by the United States for improved human rights conditions and democratic reforms in Cuba. The promotion of democracy supports universal human rights by empowering civil society and a person’s right to speak freely, peacefully assemble, and associate, and by supporting the ability of people to freely determine their future. Our efforts are aimed at promoting the independence of the Cuban people so they do not need to rely on the Cuban state.
The U.S. Congress funds democracy programming in Cuba to provide humanitarian assistance, promote human rights and fundamental freedoms, and support the free flow of information in places where it is restricted and censored. The Administration will continue to implement U.S. programs aimed at promoting positive change in Cuba, and we will encourage reforms in our high level engagement with Cuban officials.
The United States encourages all nations and organizations engaged in diplomatic dialogue with the Cuban government to take every opportunity both publicly and privately to support increased respect for human rights and fundamental freedoms in Cuba.
Ultimately, it will be the Cuban people who drive economic and political reforms. That is why President Obama took steps to increase the flow of resources and information to ordinary Cuban citizens in 2009, 2011, and today. The Cuban people deserve the support of the United States and of an entire region that has committed to promote and defend democracy through the Inter-American Democratic Charter.
U.S. SUPPORTS RIGHT OF HAITIAN PEOPLE TO HAVE ELECTIONS
FROM: U.S. STATE DEPARTMENT
Elections in Haiti
Press Statement
John Kerry
Secretary of State
Washington, DC
December 16, 2014
As Haiti’s political leaders work to resolve the issue of delayed elections, the United States supports the right of the Haitian people to go to the polls to determine their future. Elections are essential for Haiti’s democratic development and for continued progress in post-earthquake reconstruction and development. We commend the work of Haiti's presidential advisory commission and welcome its recommendations as a basis to encourage consensus. We also commend President Martelly for his courageous efforts to resolve the deadlock and for his decision to accept the commission’s recommendations. Prime Minister Lamothe's announcement of his resignation is evidence of the Haitian executive branch’s commitment to resolve the situation. Haiti’s parliamentary and political leaders also have worked in earnest to maintain the integrity of Haiti’s democratic institutions. Recognizing the concessions made by all sides to resolve the impasse, the United States urges all parties to reach without delay a definitive agreement on all outstanding issues and to carry out that agreement in good faith. Too much progress has been made since the earthquake to risk going backwards now. The future of that progress is in the hands of Haiti’s leaders, and we urge them to negotiate a solution that will open the door for elections to be scheduled as soon as possible.
Elections in Haiti
Press Statement
John Kerry
Secretary of State
Washington, DC
December 16, 2014
As Haiti’s political leaders work to resolve the issue of delayed elections, the United States supports the right of the Haitian people to go to the polls to determine their future. Elections are essential for Haiti’s democratic development and for continued progress in post-earthquake reconstruction and development. We commend the work of Haiti's presidential advisory commission and welcome its recommendations as a basis to encourage consensus. We also commend President Martelly for his courageous efforts to resolve the deadlock and for his decision to accept the commission’s recommendations. Prime Minister Lamothe's announcement of his resignation is evidence of the Haitian executive branch’s commitment to resolve the situation. Haiti’s parliamentary and political leaders also have worked in earnest to maintain the integrity of Haiti’s democratic institutions. Recognizing the concessions made by all sides to resolve the impasse, the United States urges all parties to reach without delay a definitive agreement on all outstanding issues and to carry out that agreement in good faith. Too much progress has been made since the earthquake to risk going backwards now. The future of that progress is in the hands of Haiti’s leaders, and we urge them to negotiate a solution that will open the door for elections to be scheduled as soon as possible.
HOMELAND SECURITY AGENT RECEIVES PRISON TERM FOR IMPEDING GOVERNMENT CORRUPTION INVESTIGATIONS
FROM: U.S. JUSTICE DEPARTMENT
Monday, December 15, 2014
Former Special Agent in Charge of the Department of Homeland Security's Office of Inspector General Sentenced to More Than Three Years in Prison
A former Special Agent in Charge of the Department of Homeland Security - Office of Inspector General (DHS-OIG) was sentenced to 37 months in prison today for a scheme to falsify records and obstruct an internal DHS-OIG inspection, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Special Agent in Charge Christopher Combs of the FBI’s San Antonio Field Office. The sentence was imposed by U.S. District Judge Andrew S. Hanen of the Southern District of Texas.
“While leading an office responsible for investigating misconduct at other government agencies, Pedraza sought to impede and obstruct the investigation of his own office,” said Assistant Attorney General Caldwell. “Pedraza’s criminal conduct resulted in the premature closing of criminal cases without resolution, potentially endangering our national security and allowing others to escape justice. We will root out and prosecute corruption wherever it may be found, including within the ranks of federal law enforcement.”
Former DHS-OIG Special-Agent-in-Charge Eugenio Pedraza, 50, of McAllen, Texas, was found guilty following a four-day jury trial on March 14, 2014, of conspiring with three other special agents to falsify criminal investigative reports to impede an internal DHS-OIG inspection and obstruct the underlying criminal investigations. The jury also found Pedraza guilty of five counts of falsifying records.
DHS-OIG is responsible for investigating alleged criminal activity by DHS employees, including corruption by Customs and Border Protection (CBP) and Immigration and Customs Enforcement personnel affecting the integrity of the U.S. borders. Pedraza headed DHS-OIG’s McAllen Field Office (MCA) from January 2009 to January 2012.
According to evidence presented at trial, in September 2011, DHS-OIG conducted an internal inspection of the MCA to evaluate whether the agency’s investigative standards and policies were being followed. In anticipation of the internal inspection, Pedraza and at least three other DHS-OIG agents, including Special Agent Wayne Ball, engaged in a scheme to falsify investigative documents to make it appear that criminal investigations were being conducted in a timely fashion and in accordance with DHS-OIG standard operating procedures. The scheme’s purpose was to conceal severe lapses in DHS-OIG’s investigative standards and policies at the MCA and Pedraza’s failure to properly supervise agents and investigations. Court documents reflect that Pedraza, Ball, and other special agents wrote and signed false criminal investigative reports. Pedraza then approved the reports for inclusion in the official investigative case files.
For example, the evidence at trial showed that, at Pedraza’s direction, a special agent drafted false memoranda of activity (MOAs) to fill gaps of inactivity in a criminal investigation to which he was assigned. The criminal investigation had been initiated in March 2010 and concerned allegations that a CBP officer was assisting the unlawful smuggling of undocumented aliens and narcotics into the United States. Because the MOAs were intended to describe investigative activities that occurred when the drafting agent was either not present at the MCA or not employed by DHS-OIG at all, Pedraza directed the agent to attribute the investigative activity to Ball. Ball then signed and backdated the false MOAs. Pedraza also signed and backdated the false MOAs, which were then placed in the investigation’s case file in advance of the internal inspection. Upon discovery of the falsified reports, the criminal investigation had to be closed without resolution. According to evidence presented at trial, Pedraza similarly directed other special agents to falsify records related to at least four other criminal investigations.
On Jan. 17, 2013, Ball pleaded guilty to one count of conspiring with Pedraza and at least two other special agents to falsify records in federal investigations and obstruct an agency proceeding. Ball is scheduled to be sentenced on Jan. 7, 2015, by U.S. District Judge Hilda G. Tagle of the Southern District of Texas.
This case was investigated by the FBI’s San Antonio Field Office and is being prosecuted by Trial Attorneys Eric Gibson, Brian Kidd and J.P. Cooney of the Criminal Division’s Public Integrity Section.
Monday, December 15, 2014
Former Special Agent in Charge of the Department of Homeland Security's Office of Inspector General Sentenced to More Than Three Years in Prison
A former Special Agent in Charge of the Department of Homeland Security - Office of Inspector General (DHS-OIG) was sentenced to 37 months in prison today for a scheme to falsify records and obstruct an internal DHS-OIG inspection, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Special Agent in Charge Christopher Combs of the FBI’s San Antonio Field Office. The sentence was imposed by U.S. District Judge Andrew S. Hanen of the Southern District of Texas.
“While leading an office responsible for investigating misconduct at other government agencies, Pedraza sought to impede and obstruct the investigation of his own office,” said Assistant Attorney General Caldwell. “Pedraza’s criminal conduct resulted in the premature closing of criminal cases without resolution, potentially endangering our national security and allowing others to escape justice. We will root out and prosecute corruption wherever it may be found, including within the ranks of federal law enforcement.”
Former DHS-OIG Special-Agent-in-Charge Eugenio Pedraza, 50, of McAllen, Texas, was found guilty following a four-day jury trial on March 14, 2014, of conspiring with three other special agents to falsify criminal investigative reports to impede an internal DHS-OIG inspection and obstruct the underlying criminal investigations. The jury also found Pedraza guilty of five counts of falsifying records.
DHS-OIG is responsible for investigating alleged criminal activity by DHS employees, including corruption by Customs and Border Protection (CBP) and Immigration and Customs Enforcement personnel affecting the integrity of the U.S. borders. Pedraza headed DHS-OIG’s McAllen Field Office (MCA) from January 2009 to January 2012.
According to evidence presented at trial, in September 2011, DHS-OIG conducted an internal inspection of the MCA to evaluate whether the agency’s investigative standards and policies were being followed. In anticipation of the internal inspection, Pedraza and at least three other DHS-OIG agents, including Special Agent Wayne Ball, engaged in a scheme to falsify investigative documents to make it appear that criminal investigations were being conducted in a timely fashion and in accordance with DHS-OIG standard operating procedures. The scheme’s purpose was to conceal severe lapses in DHS-OIG’s investigative standards and policies at the MCA and Pedraza’s failure to properly supervise agents and investigations. Court documents reflect that Pedraza, Ball, and other special agents wrote and signed false criminal investigative reports. Pedraza then approved the reports for inclusion in the official investigative case files.
For example, the evidence at trial showed that, at Pedraza’s direction, a special agent drafted false memoranda of activity (MOAs) to fill gaps of inactivity in a criminal investigation to which he was assigned. The criminal investigation had been initiated in March 2010 and concerned allegations that a CBP officer was assisting the unlawful smuggling of undocumented aliens and narcotics into the United States. Because the MOAs were intended to describe investigative activities that occurred when the drafting agent was either not present at the MCA or not employed by DHS-OIG at all, Pedraza directed the agent to attribute the investigative activity to Ball. Ball then signed and backdated the false MOAs. Pedraza also signed and backdated the false MOAs, which were then placed in the investigation’s case file in advance of the internal inspection. Upon discovery of the falsified reports, the criminal investigation had to be closed without resolution. According to evidence presented at trial, Pedraza similarly directed other special agents to falsify records related to at least four other criminal investigations.
On Jan. 17, 2013, Ball pleaded guilty to one count of conspiring with Pedraza and at least two other special agents to falsify records in federal investigations and obstruct an agency proceeding. Ball is scheduled to be sentenced on Jan. 7, 2015, by U.S. District Judge Hilda G. Tagle of the Southern District of Texas.
This case was investigated by the FBI’s San Antonio Field Office and is being prosecuted by Trial Attorneys Eric Gibson, Brian Kidd and J.P. Cooney of the Criminal Division’s Public Integrity Section.
SEC CHARGES OIL AND GAS CO & EXECS IN STOCK PRICE MANIPULATION CASE
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
2/15/2014 02:10 PM EST
The Securities and Exchange Commission today charged a New Orleans-based oil-and-gas company and five executives with running a stock trading scheme in which they claimed to have struck oil in Belize in order to manipulate the price of the company’s stock as they illegally sold restricted shares to the public.
The SEC also charged a Houston-based attorney with facilitating the scheme by issuing false legal opinion letters that allowed free trading of the restricted company stock.
According to the SEC’s complaint filed in U.S. District Court for the Eastern District of Texas, Treaty Energy Company issued deceptive press releases touting drilling successes in Belize and Texas to induce investor demand for its unregistered stock, which was then illegally distributed to the public. The SEC alleges that Treaty Energy’s founder Ronald Blackburn and four company officers – Andrew V. Reid, Bruce A. Gwyn, Lee C. Schlesinger, and Michael A. Mulshine – obtained at least $3.5 million in illicit profits from the scheme.
“Treaty Energy professed to be in the oil-and-gas business, but its real business seems to have been misleading investors,” said David Peavler, Associate Director for Enforcement in the SEC’s Fort Worth Regional Office. “These company officers were behind press releases and SEC filings announcing drilling successes that were simply falsehoods designed to deceive the market and put investor money into their own pockets.”
The SEC’s complaint further alleges that Treaty Energy’s outside counsel Samuel Whitley abused his gatekeeper role and enabled the scheme by authoring improper legal opinion letters that allowed the company and its officers to illegally distribute unregistered stock to the public. Whitley was aware that Blackburn was running the company and Treaty Energy was abusing registration rules under the federal securities laws. Yet these facts did not deter him from issuing the opinion letters that allowed the scheme to proceed.
“This case highlights the importance of gatekeepers in the sale of securities. Attorneys and other gatekeepers have an obligation to stop frauds, not enable them by turning a blind eye,” said David Woodcock, Director of the SEC’s Fort Worth Regional Office.
According to the SEC’s complaint, the scheme had three basic components. The first part began in January 2012 when Blackburn directed Treaty Energy to issue a press release claiming that its purported oil strike in Belize contained an estimated five to six million barrels of recoverable oil. Treaty’s stock price shot up nearly 80 percent that day. However, the Belize government publicly refuted Treaty Energy’s purported oil strike the very next day, calling the company’s statement “false and misleading” and “irresponsible.” The SEC alleges that despite Belize’s denial, Blackburn and the company’s officers continued to mislead investors by claiming that Belize was merely downplaying an actual oil strike for strategic reasons.
The SEC alleges that the second part of the scheme entailed Treaty Energy’s failure to disclose in public filings from 2009 to 2013 that Blackburn – previously convicted of federal income tax evasion – actually controlled the company and was a de facto officer. The SEC alleges that Reid, Gwyn, Schlesinger, and Mulshine all knew Blackburn’s true role at the company, but intentionally kept this fact out of its disclosures to conceal from the public that a convicted felon was in charge.
According to the SEC’s complaint, the final part of the scheme got underway in November 2013 when Treaty Energy began offering investors working interests in a well in West Texas. Investors were enticed with claims that the working interests were low-risk and expected to yield a return of 111.42 percent over a 10-year period. The SEC alleges that Treaty Energy and its officers knew these claims were baseless because the well was producing only marginal amounts of oil. In fact, the well produced 235 total barrels from October 2013 to October 2014.
The SEC’s complaint charges Treaty Energy, Blackburn, Reid, Gwyn, Mulshine, and Schlesinger with securities fraud as well as violations of the registration and reporting violations of the federal securities laws. The SEC seeks disgorgement of ill-gotten gains with prejudgment interest plus financial penalties as well as penny stock bars, officer-and-director bars, and permanent injunctions against them. Reid and Gwyn are additionally charged with signing false certifications in Treaty Energy’s SEC filings, and Whitley is accused of securities registration violations.
The SEC’s investigation was conducted by Samantha Martin, Keith Hunter, and Joann Harris of the Fort Worth Regional Office. The SEC’s litigation will be led by Jessica Magee.
2/15/2014 02:10 PM EST
The Securities and Exchange Commission today charged a New Orleans-based oil-and-gas company and five executives with running a stock trading scheme in which they claimed to have struck oil in Belize in order to manipulate the price of the company’s stock as they illegally sold restricted shares to the public.
The SEC also charged a Houston-based attorney with facilitating the scheme by issuing false legal opinion letters that allowed free trading of the restricted company stock.
According to the SEC’s complaint filed in U.S. District Court for the Eastern District of Texas, Treaty Energy Company issued deceptive press releases touting drilling successes in Belize and Texas to induce investor demand for its unregistered stock, which was then illegally distributed to the public. The SEC alleges that Treaty Energy’s founder Ronald Blackburn and four company officers – Andrew V. Reid, Bruce A. Gwyn, Lee C. Schlesinger, and Michael A. Mulshine – obtained at least $3.5 million in illicit profits from the scheme.
“Treaty Energy professed to be in the oil-and-gas business, but its real business seems to have been misleading investors,” said David Peavler, Associate Director for Enforcement in the SEC’s Fort Worth Regional Office. “These company officers were behind press releases and SEC filings announcing drilling successes that were simply falsehoods designed to deceive the market and put investor money into their own pockets.”
The SEC’s complaint further alleges that Treaty Energy’s outside counsel Samuel Whitley abused his gatekeeper role and enabled the scheme by authoring improper legal opinion letters that allowed the company and its officers to illegally distribute unregistered stock to the public. Whitley was aware that Blackburn was running the company and Treaty Energy was abusing registration rules under the federal securities laws. Yet these facts did not deter him from issuing the opinion letters that allowed the scheme to proceed.
“This case highlights the importance of gatekeepers in the sale of securities. Attorneys and other gatekeepers have an obligation to stop frauds, not enable them by turning a blind eye,” said David Woodcock, Director of the SEC’s Fort Worth Regional Office.
According to the SEC’s complaint, the scheme had three basic components. The first part began in January 2012 when Blackburn directed Treaty Energy to issue a press release claiming that its purported oil strike in Belize contained an estimated five to six million barrels of recoverable oil. Treaty’s stock price shot up nearly 80 percent that day. However, the Belize government publicly refuted Treaty Energy’s purported oil strike the very next day, calling the company’s statement “false and misleading” and “irresponsible.” The SEC alleges that despite Belize’s denial, Blackburn and the company’s officers continued to mislead investors by claiming that Belize was merely downplaying an actual oil strike for strategic reasons.
The SEC alleges that the second part of the scheme entailed Treaty Energy’s failure to disclose in public filings from 2009 to 2013 that Blackburn – previously convicted of federal income tax evasion – actually controlled the company and was a de facto officer. The SEC alleges that Reid, Gwyn, Schlesinger, and Mulshine all knew Blackburn’s true role at the company, but intentionally kept this fact out of its disclosures to conceal from the public that a convicted felon was in charge.
According to the SEC’s complaint, the final part of the scheme got underway in November 2013 when Treaty Energy began offering investors working interests in a well in West Texas. Investors were enticed with claims that the working interests were low-risk and expected to yield a return of 111.42 percent over a 10-year period. The SEC alleges that Treaty Energy and its officers knew these claims were baseless because the well was producing only marginal amounts of oil. In fact, the well produced 235 total barrels from October 2013 to October 2014.
The SEC’s complaint charges Treaty Energy, Blackburn, Reid, Gwyn, Mulshine, and Schlesinger with securities fraud as well as violations of the registration and reporting violations of the federal securities laws. The SEC seeks disgorgement of ill-gotten gains with prejudgment interest plus financial penalties as well as penny stock bars, officer-and-director bars, and permanent injunctions against them. Reid and Gwyn are additionally charged with signing false certifications in Treaty Energy’s SEC filings, and Whitley is accused of securities registration violations.
The SEC’s investigation was conducted by Samantha Martin, Keith Hunter, and Joann Harris of the Fort Worth Regional Office. The SEC’s litigation will be led by Jessica Magee.
U.S. HAS PLAN TO HANDLE EBOLA MEDICAL WASTE
FROM: U.S. TRANSPORTATION DEPARTMENT
U.S. Department of Transportation Approved Special Permit for the Safe Transport of Ebola Infected Medical Waste for Disposal
WASHINGTON—The U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) in coordination with the Centers for Disease Control and Prevention (CDC) announced that it has issued an emergency special permit allowing a Lake Forest, Ill.-based company to transport large quantities of Ebola-contaminated waste from Texas Health Presbyterian Hospital Dallas for disposal.
The special permit will cover all of Texas, not just waste originating at Texas Health Presbyterian Hospital Dallas, which is beneficial should another diagnosed case present itself in the state. The special permit also extends to the removal of household hazardous material, including the patient’s home. Special permits are issued to individual companies to ensure that each holder is fit to conduct the activity authorized. PHMSA has been in proactive discussions with CDC to prepare guidance to address emerging issues elsewhere in the United States should they develop.
The special permit issued today offers Stericycle, Inc. two alternative options for packaging the waste material prior to transport. Both options require a series of inner and outer packaging and the application of a CDC-authorized disinfectant to the inner packaging. The special permit also provides instructions for operation controls during transport, and requires the carrier to maintain a written spill response plan with guidelines for protecting employees and decontaminating any released material in the event of an accident. For more information about the special permit, please click here.
The Hazardous Materials Regulations authorizes the issuance of special permits that allow a company or individual to package or ship hazardous materials in a manner that varies from existing regulations but maintains an equivalent level of safety. Solid materials contaminated with the Ebola virus are classified as Category A infectious substances according to the Hazardous Materials Regulations. Current safety regulations governing the transport of Category A infectious substances require packaging that may not be always suited for the transport of larger quantities of contaminated waste. The treatment of Ebola patients creates a relatively large quantity of contaminated medical waste.
While the U.S. Department of Transportation’s PHMSA approves the special permit to Stericycle, the contract for services is between the company and Texas Health Presbyterian Hospital Dallas. All questions related to the terms of the contract and operational logistics such as the costs, the times of pick up, disposal locations, the volume of materials, etc. should be answered by the state of Texas health officials or the hospital.
DOT 94-14
Friday, October 3, 2014
U.S. Department of Transportation Approved Special Permit for the Safe Transport of Ebola Infected Medical Waste for Disposal
WASHINGTON—The U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) in coordination with the Centers for Disease Control and Prevention (CDC) announced that it has issued an emergency special permit allowing a Lake Forest, Ill.-based company to transport large quantities of Ebola-contaminated waste from Texas Health Presbyterian Hospital Dallas for disposal.
The special permit will cover all of Texas, not just waste originating at Texas Health Presbyterian Hospital Dallas, which is beneficial should another diagnosed case present itself in the state. The special permit also extends to the removal of household hazardous material, including the patient’s home. Special permits are issued to individual companies to ensure that each holder is fit to conduct the activity authorized. PHMSA has been in proactive discussions with CDC to prepare guidance to address emerging issues elsewhere in the United States should they develop.
The special permit issued today offers Stericycle, Inc. two alternative options for packaging the waste material prior to transport. Both options require a series of inner and outer packaging and the application of a CDC-authorized disinfectant to the inner packaging. The special permit also provides instructions for operation controls during transport, and requires the carrier to maintain a written spill response plan with guidelines for protecting employees and decontaminating any released material in the event of an accident. For more information about the special permit, please click here.
The Hazardous Materials Regulations authorizes the issuance of special permits that allow a company or individual to package or ship hazardous materials in a manner that varies from existing regulations but maintains an equivalent level of safety. Solid materials contaminated with the Ebola virus are classified as Category A infectious substances according to the Hazardous Materials Regulations. Current safety regulations governing the transport of Category A infectious substances require packaging that may not be always suited for the transport of larger quantities of contaminated waste. The treatment of Ebola patients creates a relatively large quantity of contaminated medical waste.
While the U.S. Department of Transportation’s PHMSA approves the special permit to Stericycle, the contract for services is between the company and Texas Health Presbyterian Hospital Dallas. All questions related to the terms of the contract and operational logistics such as the costs, the times of pick up, disposal locations, the volume of materials, etc. should be answered by the state of Texas health officials or the hospital.
DOT 94-14
Friday, October 3, 2014
SEC CHARGES U.S. TECH FIRM IN CASE INVOLVING PAYMENTS TO CHINESE GOVERNMENT OFFICIALS
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
The Securities and Exchange Commission today charged a Billerica, Mass.-based global manufacturer of scientific instruments with violating the Foreign Corrupt Practices Act (FCPA) by providing non-business related travel and improper payments to various Chinese government officials in an effort to win business.
An SEC investigation found that Bruker Corporation lacked sufficient internal controls to prevent and detect approximately $230,000 in improper payments out of its China-based offices that falsely recorded them in books and records as legitimate business and marketing expenses. The payments enabled Bruker to realize approximately $1.7 million in profits from sales contracts with state-owned entities in China whose officials received the improper payments.
Bruker, which self-reported its misconduct and provided extensive cooperation during the SEC’s investigation, agreed to pay approximately $2.4 million to settle the SEC’s charges.
“Bruker’s lax internal controls allowed employees in its China offices to enter into sham ‘collaboration agreements’ to direct money to foreign officials and send officials on sightseeing trips around the world,” said Kara Brockmeyer, Chief of the SEC Enforcement Division’s FCPA Unit. “The company has since taken significant remedial steps to revise its compliance program and enhance internal controls over travel and contract approvals.”
According to the SEC’s order instituting a settled administrative proceeding, a Bruker office in China paid more than $111,000 to Chinese government officials under 12 suspicious collaboration agreements contingent on state-owned entities providing research on Bruker products or using Bruker products in demonstration laboratories. The collaboration agreements did not specify the work product that the state-owned entities had to provide in order to be paid, and no work product was actually provided to the Bruker office by the state-owned entities. Certain collaboration agreements were executed directly with a Chinese government official rather than the state-owned entity itself, and in some cases Bruker’s office paid the official directly.
According to the SEC’s order, the other improper payments involved reimbursements to Chinese government officials for leisure travel to the United States, Czech Republic, Norway, Sweden, France, Germany, Switzerland, and Italy. These officials often were responsible for authorizing the purchase of Bruker products, and the leisure trips typically followed business-related travel for the officials funded by the company. For example, Bruker paid for the purported training expenses of a Chinese government official who signed the sales contract on behalf of a state-owned entity, but the payment actually was reimbursement for sightseeing, tour tickets, shopping, and other leisure activities in Frankfurt and Paris. Bruker also funded some trips for Chinese government officials that had no legitimate business component. For example, two Chinese government officials received paid travel to New York despite the lack of any Bruker facilities there, and also to Los Angeles where they engaged in sightseeing activities.
The SEC’s order finds that Bruker violated the internal controls and books and records provisions of the Securities Exchange Act of 1934. The company agreed to pay $1,714,852 in disgorgement, $310,117 in prejudgment interest, and a $375,000 penalty. Bruker consented to the order without admitting or denying the findings, and the SEC considered the company’s significant remedial acts as well as its self-reporting and cooperation with the investigation when determining a settlement.
The SEC’s investigation was conducted by Asita Obeyesekere and Mark Albers of the Boston Regional Office. The case was supervised by Paul G. Block of the FCPA Unit.
The Securities and Exchange Commission today charged a Billerica, Mass.-based global manufacturer of scientific instruments with violating the Foreign Corrupt Practices Act (FCPA) by providing non-business related travel and improper payments to various Chinese government officials in an effort to win business.
An SEC investigation found that Bruker Corporation lacked sufficient internal controls to prevent and detect approximately $230,000 in improper payments out of its China-based offices that falsely recorded them in books and records as legitimate business and marketing expenses. The payments enabled Bruker to realize approximately $1.7 million in profits from sales contracts with state-owned entities in China whose officials received the improper payments.
Bruker, which self-reported its misconduct and provided extensive cooperation during the SEC’s investigation, agreed to pay approximately $2.4 million to settle the SEC’s charges.
“Bruker’s lax internal controls allowed employees in its China offices to enter into sham ‘collaboration agreements’ to direct money to foreign officials and send officials on sightseeing trips around the world,” said Kara Brockmeyer, Chief of the SEC Enforcement Division’s FCPA Unit. “The company has since taken significant remedial steps to revise its compliance program and enhance internal controls over travel and contract approvals.”
According to the SEC’s order instituting a settled administrative proceeding, a Bruker office in China paid more than $111,000 to Chinese government officials under 12 suspicious collaboration agreements contingent on state-owned entities providing research on Bruker products or using Bruker products in demonstration laboratories. The collaboration agreements did not specify the work product that the state-owned entities had to provide in order to be paid, and no work product was actually provided to the Bruker office by the state-owned entities. Certain collaboration agreements were executed directly with a Chinese government official rather than the state-owned entity itself, and in some cases Bruker’s office paid the official directly.
According to the SEC’s order, the other improper payments involved reimbursements to Chinese government officials for leisure travel to the United States, Czech Republic, Norway, Sweden, France, Germany, Switzerland, and Italy. These officials often were responsible for authorizing the purchase of Bruker products, and the leisure trips typically followed business-related travel for the officials funded by the company. For example, Bruker paid for the purported training expenses of a Chinese government official who signed the sales contract on behalf of a state-owned entity, but the payment actually was reimbursement for sightseeing, tour tickets, shopping, and other leisure activities in Frankfurt and Paris. Bruker also funded some trips for Chinese government officials that had no legitimate business component. For example, two Chinese government officials received paid travel to New York despite the lack of any Bruker facilities there, and also to Los Angeles where they engaged in sightseeing activities.
The SEC’s order finds that Bruker violated the internal controls and books and records provisions of the Securities Exchange Act of 1934. The company agreed to pay $1,714,852 in disgorgement, $310,117 in prejudgment interest, and a $375,000 penalty. Bruker consented to the order without admitting or denying the findings, and the SEC considered the company’s significant remedial acts as well as its self-reporting and cooperation with the investigation when determining a settlement.
The SEC’s investigation was conducted by Asita Obeyesekere and Mark Albers of the Boston Regional Office. The case was supervised by Paul G. Block of the FCPA Unit.
Tuesday, December 16, 2014
U.S. CONDEMNS TALIBAN ATTACKS ON SCHOOL IN PAKISTAN
FROM: U.S. DEFENSE DEPARTMENT
U.S. Stands With Pakistanis, Afghans Against Taliban
By Jim Garamone
DoD News, Defense Media Activity
WASHINGTON, Dec. 16, 2014 – The United States condemns the deadly Taliban attack on a Pakistani school and remains committed to bringing stability to the Afghanistan-Pakistan region, Navy Rear Adm. John Kirby said today, emphasizing that the end of the NATO combat mission does not mean an end to U.S. involvement in the region.
The attack on the school in Peshawar is the latest manifestation of the savagery of the Taliban, Kirby said, noting that Pakistan remains a front-line state in the battle against terrorism and extremists and has suffered major casualties in the struggle against the Taliban. While U.S.-Pakistani relations have been rocky at times over the past decade, both countries share the fight, the admiral said, and added that today’s terrorist attack will not change that.
“I think we have certainly made it clear to Pakistan that we’re willing to help in the wake of this attack should they want or need any,” the admiral said. “There’s been no request for U.S. assistance. But we’ve certainly made it obvious that we’re willing to assist in any way we can.”
The attack on the school killed more than 140 children and teachers.
Across the border in Afghanistan the mission will change, Kirby said, but American and partner nations will continue their commitment to Afghan stability.
With Afghan forces now in charge of security, reporters asked Kirby whether they would be able to defend against an attack like the one in Pakistan. “The Afghan national security forces are very capable,” Kirby said. “They are already leading security operations in their country, and for all intents and purposes, are … conducting all the combat missions inside Afghanistan.”
Afghan forces secured both national elections this year and while there has been an upsurge in violence in Kabul, Afghan forces have handled the situations well, he noted. Officials expected the recent spate of Taliban attacks inside the capital as the NATO mission transitions. Kirby said the attacks are a Taliban tactic to “divert attention from the fact that real progress has been made and that Afghanistan is a more safe and secure environment than it was even just six months ago.”
Afghanistan is still a dangerous place, the admiral said, but no one is walking away from it.
U.S. Stands With Pakistanis, Afghans Against Taliban
By Jim Garamone
DoD News, Defense Media Activity
WASHINGTON, Dec. 16, 2014 – The United States condemns the deadly Taliban attack on a Pakistani school and remains committed to bringing stability to the Afghanistan-Pakistan region, Navy Rear Adm. John Kirby said today, emphasizing that the end of the NATO combat mission does not mean an end to U.S. involvement in the region.
The attack on the school in Peshawar is the latest manifestation of the savagery of the Taliban, Kirby said, noting that Pakistan remains a front-line state in the battle against terrorism and extremists and has suffered major casualties in the struggle against the Taliban. While U.S.-Pakistani relations have been rocky at times over the past decade, both countries share the fight, the admiral said, and added that today’s terrorist attack will not change that.
“I think we have certainly made it clear to Pakistan that we’re willing to help in the wake of this attack should they want or need any,” the admiral said. “There’s been no request for U.S. assistance. But we’ve certainly made it obvious that we’re willing to assist in any way we can.”
The attack on the school killed more than 140 children and teachers.
Across the border in Afghanistan the mission will change, Kirby said, but American and partner nations will continue their commitment to Afghan stability.
With Afghan forces now in charge of security, reporters asked Kirby whether they would be able to defend against an attack like the one in Pakistan. “The Afghan national security forces are very capable,” Kirby said. “They are already leading security operations in their country, and for all intents and purposes, are … conducting all the combat missions inside Afghanistan.”
Afghan forces secured both national elections this year and while there has been an upsurge in violence in Kabul, Afghan forces have handled the situations well, he noted. Officials expected the recent spate of Taliban attacks inside the capital as the NATO mission transitions. Kirby said the attacks are a Taliban tactic to “divert attention from the fact that real progress has been made and that Afghanistan is a more safe and secure environment than it was even just six months ago.”
Afghanistan is still a dangerous place, the admiral said, but no one is walking away from it.
U.S. CONGRATULATES PEOPLE OF KAZAKHSTAN ON THEIR INDEPENDENCE DAY
FROM: U.S. STATE DEPARTMENT
Anniversary of Kazakhstan's Independence Day
Press Statement
John Kerry
Secretary of State
Washington, DC
December 16, 2014
On behalf of President Obama and the people of the United States, I congratulate the people of Kazakhstan as you celebrate your Independence Day on December 16.
The United States was the first country in the world to recognize your independence in 1991. Our friendship has only grown stronger since that day twenty three years ago.
I was honored to host Foreign Minister Irlan Idrisov recently in Washington, D.C. It was clear to both of us that we share an interest in bolstering economic ties, securing a reliable energy future, and maintaining regional and global security. We will continue to work with Kazakhstan’s government officials, civil society, and private sector leaders to improve human rights and help build a more stable, secure, democratic, and prosperous future.
As you celebrate this special day, I wish all of the Kazakhstani people peace and prosperity in the coming year.
Anniversary of Kazakhstan's Independence Day
Press Statement
John Kerry
Secretary of State
Washington, DC
December 16, 2014
On behalf of President Obama and the people of the United States, I congratulate the people of Kazakhstan as you celebrate your Independence Day on December 16.
The United States was the first country in the world to recognize your independence in 1991. Our friendship has only grown stronger since that day twenty three years ago.
I was honored to host Foreign Minister Irlan Idrisov recently in Washington, D.C. It was clear to both of us that we share an interest in bolstering economic ties, securing a reliable energy future, and maintaining regional and global security. We will continue to work with Kazakhstan’s government officials, civil society, and private sector leaders to improve human rights and help build a more stable, secure, democratic, and prosperous future.
As you celebrate this special day, I wish all of the Kazakhstani people peace and prosperity in the coming year.
SECRETARY KERRY'S PRESS AVAILABILITY IN LONDON
FROM: U.S. STATE DEPARTMENT
Press Availability in London
Press Availability
John Kerry
Secretary of State
London, United Kingdom
December 16, 2014
SECRETARY KERRY: Afternoon, everybody. Thanks for being here. Obviously, the last few days have been fairly intensive set of discussions, and we’ve covered a lot of ground, so I thought it was important to try to bring everybody up to speed on the road journeyed and the road ahead.
Before I do, though, I want to address, for a moment, the tragic events that have taken place over the course of the last 24 hours that have hit our friends in Australia and in Pakistan.
The news of the brazen murder of more than 120 innocent students in Peshawar is devastating. And as a father, I know exactly how hard it is when you send kids out of house into the world, to school or anywhere, and particularly in today’s world. Mothers and fathers send their kids to school to learn and to be safe and to dream and to find opportunity. And particularly at this military school in Pakistan, they sent their kids there with the hope and dreams of serving their country. Instead, today they are gone, wiped away by Taliban assassins who serve a dark and almost medieval vision, and the opposite of everything that those mothers and fathers wanted for their children.
The images are absolutely gut-wrenching: young children carried away in ambulances, a teacher burned alive in front of the students, a house of learning turned into a house of unspeakable horror. And Prime Minister Sharif said, “These are my children. It is my loss.” Well, this morning, wherever you live, wherever you are, those are our children, and this is the world’s loss. This act of terror angers and shakes all people of conscience, and we condemn it in the strongest terms possible. The perpetrators must be brought to justice. And we pledge our full support to the people of Pakistan in this difficult hour and we will help them in any way that we possibly can.
Likewise, our friends in Sydney are also especially on our minds. The United States, obviously, in recent memory, has come face to face with horrific violence on our own soil, and we have seen our citizens held hostage and murdered in faraway places for the most nihilistic, devastatingly negative purposes. So we know in a very personal way what our ally Australia is going through at this very moment. And we grieve with Australia and with the families of all those terrorized, injured, and killed.
And even though we’re at opposite ends of the globe, the United States and Australia are united not just in an alliance, but we are deeply united by our values and our friendship and our years of cooperation together. Our countries and our people are strong. And Australian law enforcement and security forces are about as good as it gets. I spoke this morning with Foreign Minister Julie Bishop and told her that the United States stands ready to provide whatever appropriate assistance we can as Australian authorities determine the facts of the case, assist the victims, and hold accountable anyone and everyone responsible for this act of terror.
The attacks in Peshawar and Sydney underscore that threats locally are also threats globally. In today’s world, next door is everywhere. And that’s why the United States is engaged in more places with more partners on more issues than ever before, and we are committed with all those allies and partners to standing up to extremism and to the extremists themselves.
And make no mistake, we are just as committed to finding ways to help solve the challenges of the Middle East and of other places of extremism and of terrorist activity because we know too well that while it’s difficult work, it’s also the only course that has any possibility of taking us towards stability, towards prosperity, towards a future. And so we will remain committed to this effort.
Over the past few days, I’ve had very candid and constructive conversations with Russian Foreign Minister Lavrov, Secretary of State of the Holy See Cardinal Parolin, with Israeli Prime Minister Netanyahu yesterday in Rome, with EU High Representative Mogherini, and with my counterparts from Jordan, Egypt, the United Kingdom, France, and Germany. And I will do the same today, the same kinds of conversations today, with Palestinian leaders who are here in London, with the Arab League Secretary-General Elaraby and his delegation who have come on behalf of the Arab League.
Now obviously, a focus of these conversations has been our deep concern about the situation on the ground in Israel and in the West Bank and the mounting calls from the international community to pursue diplomatic measures to try to address it. I want to be very clear: This isn’t the time to detail private conversations or speculate on a UN Security Council resolution that hasn’t even been tabled, no matter what pronouncements are made publicly about it. Many of us share a deep sense of urgency about this, given the constant threat of escalation and the dangers of a downward spiral of violence.
But we’re also very mindful that we have to carefully calibrate any steps that are taken for this difficult moment in the region. We all understand the challenges that are presented by this conflict. We all understand that there are pent-up frustrations on both sides and they run deep. We all know the risk of escalation. It’s constant and it’s real. And that is why it is imperative to lower the temperature, end the tension, so that we have an opportunity to find a path that Israelis and Palestinians both want so desperately, which is a path that leads out of the current predicament and actually provides people with an opportunity to touch, to feel, to see and know that there really is a prospect for genuine peace.
They want – everybody that I have talked to keeps talking to me – all the leaders on both sides keep talking to me about how they want a safe and secure future, and obviously, more hope for their people. All of the reasons that we engaged so intensely one year ago, a little more than that, and all the reasons that Prime Minister Netanyahu and President Abbas were willing to engage – those reasons are even more compelling today. The status quo is unsustainable for both parties and for the region.
And no people should have to endure a barrage of rockets in the thousands or the threat of a terrorist jumping out of a tunnel armed with a tranquilizer, drugs, and handcuffs in order to snatch them out of the night and drag them back into another place where they can hold them hostage. No one should have to endure either of those things. But the Israelis saw that firsthand during the course of the Gaza conflict. And likewise, no community should have to endure the loss of thousands of its citizens, including hundreds of women and children, as the Palestinians experienced during the same conflict, during – due to the choices that Hamas made that led them nowhere.
The ongoing unrest of the last weeks has brought new tensions to all sides. And earlier this month, two Israelis were stabbed as they shopped for groceries in the West Bank. Two more were axed to death while praying. And we were all devastated and shocked by the acid attack against an Israeli family last week. Palestinians have mourned the death of a Palestinian official, Ziad Abu Ein, and they have suffered indefensible price tag attacks, so-called price tag attacks, including the recent burning of a mosque near Ramallah.
The cycle of violence leads to more violence and to nowhere. Peace is the only prospect, and people need to fight for it. Getting to a better place is obviously not easy, but the alternative is more of the violence and the suffering that no people anywhere should have to accept as the daily fare of their lives, as the price of being born Israeli or Palestinian. And we are focused – we, the United States, and our allies and our friends in Europe and in the Arab community are all focused on a different path. Our friends are focused on a path that could lead to a different future, and we will never hesitate to fight to go down that path.
And that is why the United States and our partners will remain deeply engaged not just with the Israelis and the Palestinians, but on the other conflict – conflicts, plural, that dominated our discussions during the course of this week.
In Syria and Iraq, a historically broad coalition composed of countries from five continents is taking on Daesh, a vicious terrorist organization whose sheer evil clearly knows no bounds. And I engaged in a conversation with Foreign Minister Lavrov regarding the need for a political settlement, which he also agrees is the only solution, as do others in the region and all of our European allies.
And in Ukraine, the international community continues to stand up for the principle that a nation has the right to determine its own future, that no matter how powerful and aggressive its neighbor, its borders should be sovereign and should be integral and respected.
Now obviously, there is no shortage, therefore, of challenges, and I’ve only scratched the surface in those that I’ve listed. There is, of course, Libya, Somali, and the Sahel, the Maghreb and Yemen and Afghanistan, and you can run a longer list, yes. And we are engaged in all of those places trying to find a better path forward.
But even as we look down this difficult road that’s before us and consider the complicated choices that we face, we simply cannot lose sight of the fact that that hard road leads to a better place. I’m convinced of that. The United States recognizes the deeply felt aspiration for peace shared by the vast majority of Israelis and Palestinians, and we will continue to work with our friends and partners to find a path to the goal that we all share for a more peaceful and stable region.
So with that, I’d be happy to take some questions. And I don’t know who’s up or --
MS. HARF: Yeah. Our first – is it on? Oh, yes. Our first question’s from Nicole Gaouette of Bloomberg, and the mike will come to you.
QUESTION: Thanks for giving us this time, Mr. Secretary. In the past, the U.S. has simply blocked resolutions at the UN that it feels threaten or undermine Israel. This time, you’ve made this trip to Europe to discuss various proposals with your counterparts. Can you tell us what has changed that’s led you to do this? And mindful of your concern about discussing details about resolutions, could you tell us what the U.S. would like to see or would need to see in a resolution to support it?
And finally, given the challenges that the U.S. has faced in trying to broker a Mideast peace deal over these many years, is it time for the process to become more of a multilateral affair? Thank you.
SECRETARY KERRY: Well, let me answer the last first. It’s always been a multilateral affair. There were always countries that are involved in it, but the United States clearly has a unique role to play as a result of our longtime friendship and relationship with Israel, and the role that we have played historically with respect to Camp David, Oslo and so forth. In the end, though, this isn’t up to the international community or others. This has to be decided by the parties. The parties have to want this more than anybody outside, and the parties have to make key decisions that can lead to the resolution.
Now, coming back to the first part of the questions, right now, what we’re trying to do is have a constructive conversation with everybody to find the best way to go forward in order to create the climate; the atmosphere; the political space, if you will, to be able to go back to negotiations and resolve this politically. Now, clearly, in the beginning of an election and in the middle of an election, it’s very difficult and complicated because we believe very deeply that nobody should somehow interfere or do something that might be perceived of as interfering in the course of that election, and we want to find the most constructive way of doing something that therefore will not have unintended consequences, but also can stem the violence.
It’s a particularly sensitive moment because we understand the frustrations of Palestinians. We understand the frustrations of the Palestinian Authority and President Abbas and those who are pushing hard, because they don’t see another course at this moment. So the key is to try to find out whether or not there are other options, other ways, other courses; could something be done that helps to respect the process that the Israelis are about to undergo, simultaneously respecting the needs of the region to de-escalate the tensions and avoid confrontation?
That’s what we hope to achieve, that’s what these discussions are all about, and we will continue to have these discussions this afternoon and on into the next days. But we’ve made no determinations other than that about any – about language, approaches, specific resolutions, any of that. We haven’t made any determinations.
MS. HARF: Great. And the final question is from Jo Biddle of AFP. Please wait for the mike.
QUESTION: Thank you very much, Mr. Secretary. If I could just ask you to turn our attention to Russia, today, the ruble is falling and crashing to unprecedented lows against the dollar. Was this what the United States and the European sanctions were intended to do – weaken the ruble and thereby weaken Putin and hope he changes course in Ukraine? And now that the Russian people are facing real economic hardship, is it the right time for more sanctions in order to try to force a de-escalation in Ukraine, or should Moscow be given some breathing space in order to prevent an economic meltdown which could have an effect on the global economy?
And just turning back to what you mentioned – and you talked about the Taliban, the attack in Peshawar today, and the hostage-taking in the cafe in Sydney yesterday – what is your assessment of the rising threat level from Islamic extremism around the world? Is it now, would you agree, at one of its highest levels ever, despite the United States efforts to try and counterattack this? And how could governments around the world protect their people from what seems to be a growing trend towards lone wolf attacks? Thank you.
SECRETARY KERRY: Well, obviously, everybody has taken note of what has happened with respect to the ruble in the last days and the pressures on it, and it goes without saying that the purpose of the European-U.S.-et al effort with respect to sanctions was to make it clear to Russia, to President Putin, that there are costs attached to the unilateral annexation of Crimea and the continued support for separatists within Ukraine and the violation of Ukraine’s territorial sovereignty and integrity, and the sanctions set out to do that. I don’t think that what is happening is just related to the sanctions. I think it is much broader, more complicated than that. It has to do with other issues with respect to the Russian economy, and oil prices, obviously, have also played a significant role in this. So there are a lot of combined factors, but the sanctions were clearly intended to invite President Putin to make a different set of choices.
Now, these sanctions could have been lifted months ago. These sanctions could be lifted in a matter of weeks or days, depending on the choices that President Putin takes. And we have been crystal clear – when I say “we,” the European community and the United States and others joined together have been crystal clear that their sole purpose here is to restore the international norm with respect to behavior between nations with respect for borders and respect for sovereignty and respect for the rights of people to determine their future not at the barrel of a gun, but through the ballot box.
Let me say that Russia has made constructive moves in the last days and there are some indications that whether it is the line of control negotiation or the calm that is, in fact, in place in a number of places, the withdrawal of certain people, there are signs of constructive choices. And that can only be helpful, hopefully. And our hope is that in the days ahead we can get a clear, defined path by all parties, where everybody understands what each is doing and living up to agreements and in moving to de-escalate this situation. That has always been our goal. And I’m confident that as rapidly as that can happen, you will see Europe and the United States respond with respect to the sanctions that are in place today.
We do not want the people of Russia to be hurt here. This is not our goal. None of what we are doing is targeted specifically against the people. But yes, collaterally, of course, they are caught up in the choices that their government makes and it does have an impact. We understand that. But that’s not the goal or purpose.
QUESTION: Please, on the (inaudible) on the fight against the Islamists?
SECRETARY KERRY: Oh, on the fight against extremism, is the threat – no, I’m not going to say – the threat is what the threat is. There’s always been a threat of lone wolves, from the day that those terrorists drove their airplanes into the World Trade Center and crashed in Pennsylvania, and crashed into the Pentagon, we’ve had warnings of lone wolf activities. We’ve had warnings of sleeper cells. We’ve had warnings. And there have been many, many attempts over the course of the last years. The New York attempt for a bombing in Times Square, the Christmas bomber on an airplane, and so forth. But because of great work between our countries and terrific intelligence sharing, we were able to prevent those things from happening.
But it’s always very difficult. If somebody decides they want to die, it’s very hard to prevent every situation from occurring. So I’m not going to categorize on the scale, but everybody knows that Daesh is busy using the internet to proselytize, to entice, to lie, to put out propaganda, to try to influence minds of people who may be influenceable. And so that does present a threat, and people, unfortunately, everywhere need to be sort of aware of their surroundings, more alert than we’d like to be or want to be in the context of everyday life, but that’s where we are right now.
But as I said last week, we are making progress in the initial stages of halting Daesh’s progress in Iraq, of beginning to change their behavior, of attacking their command and control, of attacking their facilities and denying them supplies, of beginning to cut off financing, beginning to reduce the flow of foreign fighters, and so we have to be tough and courageous and stay the course here. And I’m confident that people are prepared to do that, and I know that our friends in Pakistan and in Australia are tough and strong and prepared to stay the course. So it’s very unfortunate when this happens, but it is done precisely for the kind of effect that it gets, which is questions at a press conference and fears that are spread in various parts of the world.
MS. HARF: Thank you, everyone.
SECRETARY KERRY: Thank you all very much. Appreciate it.
Press Availability in London
Press Availability
John Kerry
Secretary of State
London, United Kingdom
December 16, 2014
SECRETARY KERRY: Afternoon, everybody. Thanks for being here. Obviously, the last few days have been fairly intensive set of discussions, and we’ve covered a lot of ground, so I thought it was important to try to bring everybody up to speed on the road journeyed and the road ahead.
Before I do, though, I want to address, for a moment, the tragic events that have taken place over the course of the last 24 hours that have hit our friends in Australia and in Pakistan.
The news of the brazen murder of more than 120 innocent students in Peshawar is devastating. And as a father, I know exactly how hard it is when you send kids out of house into the world, to school or anywhere, and particularly in today’s world. Mothers and fathers send their kids to school to learn and to be safe and to dream and to find opportunity. And particularly at this military school in Pakistan, they sent their kids there with the hope and dreams of serving their country. Instead, today they are gone, wiped away by Taliban assassins who serve a dark and almost medieval vision, and the opposite of everything that those mothers and fathers wanted for their children.
The images are absolutely gut-wrenching: young children carried away in ambulances, a teacher burned alive in front of the students, a house of learning turned into a house of unspeakable horror. And Prime Minister Sharif said, “These are my children. It is my loss.” Well, this morning, wherever you live, wherever you are, those are our children, and this is the world’s loss. This act of terror angers and shakes all people of conscience, and we condemn it in the strongest terms possible. The perpetrators must be brought to justice. And we pledge our full support to the people of Pakistan in this difficult hour and we will help them in any way that we possibly can.
Likewise, our friends in Sydney are also especially on our minds. The United States, obviously, in recent memory, has come face to face with horrific violence on our own soil, and we have seen our citizens held hostage and murdered in faraway places for the most nihilistic, devastatingly negative purposes. So we know in a very personal way what our ally Australia is going through at this very moment. And we grieve with Australia and with the families of all those terrorized, injured, and killed.
And even though we’re at opposite ends of the globe, the United States and Australia are united not just in an alliance, but we are deeply united by our values and our friendship and our years of cooperation together. Our countries and our people are strong. And Australian law enforcement and security forces are about as good as it gets. I spoke this morning with Foreign Minister Julie Bishop and told her that the United States stands ready to provide whatever appropriate assistance we can as Australian authorities determine the facts of the case, assist the victims, and hold accountable anyone and everyone responsible for this act of terror.
The attacks in Peshawar and Sydney underscore that threats locally are also threats globally. In today’s world, next door is everywhere. And that’s why the United States is engaged in more places with more partners on more issues than ever before, and we are committed with all those allies and partners to standing up to extremism and to the extremists themselves.
And make no mistake, we are just as committed to finding ways to help solve the challenges of the Middle East and of other places of extremism and of terrorist activity because we know too well that while it’s difficult work, it’s also the only course that has any possibility of taking us towards stability, towards prosperity, towards a future. And so we will remain committed to this effort.
Over the past few days, I’ve had very candid and constructive conversations with Russian Foreign Minister Lavrov, Secretary of State of the Holy See Cardinal Parolin, with Israeli Prime Minister Netanyahu yesterday in Rome, with EU High Representative Mogherini, and with my counterparts from Jordan, Egypt, the United Kingdom, France, and Germany. And I will do the same today, the same kinds of conversations today, with Palestinian leaders who are here in London, with the Arab League Secretary-General Elaraby and his delegation who have come on behalf of the Arab League.
Now obviously, a focus of these conversations has been our deep concern about the situation on the ground in Israel and in the West Bank and the mounting calls from the international community to pursue diplomatic measures to try to address it. I want to be very clear: This isn’t the time to detail private conversations or speculate on a UN Security Council resolution that hasn’t even been tabled, no matter what pronouncements are made publicly about it. Many of us share a deep sense of urgency about this, given the constant threat of escalation and the dangers of a downward spiral of violence.
But we’re also very mindful that we have to carefully calibrate any steps that are taken for this difficult moment in the region. We all understand the challenges that are presented by this conflict. We all understand that there are pent-up frustrations on both sides and they run deep. We all know the risk of escalation. It’s constant and it’s real. And that is why it is imperative to lower the temperature, end the tension, so that we have an opportunity to find a path that Israelis and Palestinians both want so desperately, which is a path that leads out of the current predicament and actually provides people with an opportunity to touch, to feel, to see and know that there really is a prospect for genuine peace.
They want – everybody that I have talked to keeps talking to me – all the leaders on both sides keep talking to me about how they want a safe and secure future, and obviously, more hope for their people. All of the reasons that we engaged so intensely one year ago, a little more than that, and all the reasons that Prime Minister Netanyahu and President Abbas were willing to engage – those reasons are even more compelling today. The status quo is unsustainable for both parties and for the region.
And no people should have to endure a barrage of rockets in the thousands or the threat of a terrorist jumping out of a tunnel armed with a tranquilizer, drugs, and handcuffs in order to snatch them out of the night and drag them back into another place where they can hold them hostage. No one should have to endure either of those things. But the Israelis saw that firsthand during the course of the Gaza conflict. And likewise, no community should have to endure the loss of thousands of its citizens, including hundreds of women and children, as the Palestinians experienced during the same conflict, during – due to the choices that Hamas made that led them nowhere.
The ongoing unrest of the last weeks has brought new tensions to all sides. And earlier this month, two Israelis were stabbed as they shopped for groceries in the West Bank. Two more were axed to death while praying. And we were all devastated and shocked by the acid attack against an Israeli family last week. Palestinians have mourned the death of a Palestinian official, Ziad Abu Ein, and they have suffered indefensible price tag attacks, so-called price tag attacks, including the recent burning of a mosque near Ramallah.
The cycle of violence leads to more violence and to nowhere. Peace is the only prospect, and people need to fight for it. Getting to a better place is obviously not easy, but the alternative is more of the violence and the suffering that no people anywhere should have to accept as the daily fare of their lives, as the price of being born Israeli or Palestinian. And we are focused – we, the United States, and our allies and our friends in Europe and in the Arab community are all focused on a different path. Our friends are focused on a path that could lead to a different future, and we will never hesitate to fight to go down that path.
And that is why the United States and our partners will remain deeply engaged not just with the Israelis and the Palestinians, but on the other conflict – conflicts, plural, that dominated our discussions during the course of this week.
In Syria and Iraq, a historically broad coalition composed of countries from five continents is taking on Daesh, a vicious terrorist organization whose sheer evil clearly knows no bounds. And I engaged in a conversation with Foreign Minister Lavrov regarding the need for a political settlement, which he also agrees is the only solution, as do others in the region and all of our European allies.
And in Ukraine, the international community continues to stand up for the principle that a nation has the right to determine its own future, that no matter how powerful and aggressive its neighbor, its borders should be sovereign and should be integral and respected.
Now obviously, there is no shortage, therefore, of challenges, and I’ve only scratched the surface in those that I’ve listed. There is, of course, Libya, Somali, and the Sahel, the Maghreb and Yemen and Afghanistan, and you can run a longer list, yes. And we are engaged in all of those places trying to find a better path forward.
But even as we look down this difficult road that’s before us and consider the complicated choices that we face, we simply cannot lose sight of the fact that that hard road leads to a better place. I’m convinced of that. The United States recognizes the deeply felt aspiration for peace shared by the vast majority of Israelis and Palestinians, and we will continue to work with our friends and partners to find a path to the goal that we all share for a more peaceful and stable region.
So with that, I’d be happy to take some questions. And I don’t know who’s up or --
MS. HARF: Yeah. Our first – is it on? Oh, yes. Our first question’s from Nicole Gaouette of Bloomberg, and the mike will come to you.
QUESTION: Thanks for giving us this time, Mr. Secretary. In the past, the U.S. has simply blocked resolutions at the UN that it feels threaten or undermine Israel. This time, you’ve made this trip to Europe to discuss various proposals with your counterparts. Can you tell us what has changed that’s led you to do this? And mindful of your concern about discussing details about resolutions, could you tell us what the U.S. would like to see or would need to see in a resolution to support it?
And finally, given the challenges that the U.S. has faced in trying to broker a Mideast peace deal over these many years, is it time for the process to become more of a multilateral affair? Thank you.
SECRETARY KERRY: Well, let me answer the last first. It’s always been a multilateral affair. There were always countries that are involved in it, but the United States clearly has a unique role to play as a result of our longtime friendship and relationship with Israel, and the role that we have played historically with respect to Camp David, Oslo and so forth. In the end, though, this isn’t up to the international community or others. This has to be decided by the parties. The parties have to want this more than anybody outside, and the parties have to make key decisions that can lead to the resolution.
Now, coming back to the first part of the questions, right now, what we’re trying to do is have a constructive conversation with everybody to find the best way to go forward in order to create the climate; the atmosphere; the political space, if you will, to be able to go back to negotiations and resolve this politically. Now, clearly, in the beginning of an election and in the middle of an election, it’s very difficult and complicated because we believe very deeply that nobody should somehow interfere or do something that might be perceived of as interfering in the course of that election, and we want to find the most constructive way of doing something that therefore will not have unintended consequences, but also can stem the violence.
It’s a particularly sensitive moment because we understand the frustrations of Palestinians. We understand the frustrations of the Palestinian Authority and President Abbas and those who are pushing hard, because they don’t see another course at this moment. So the key is to try to find out whether or not there are other options, other ways, other courses; could something be done that helps to respect the process that the Israelis are about to undergo, simultaneously respecting the needs of the region to de-escalate the tensions and avoid confrontation?
That’s what we hope to achieve, that’s what these discussions are all about, and we will continue to have these discussions this afternoon and on into the next days. But we’ve made no determinations other than that about any – about language, approaches, specific resolutions, any of that. We haven’t made any determinations.
MS. HARF: Great. And the final question is from Jo Biddle of AFP. Please wait for the mike.
QUESTION: Thank you very much, Mr. Secretary. If I could just ask you to turn our attention to Russia, today, the ruble is falling and crashing to unprecedented lows against the dollar. Was this what the United States and the European sanctions were intended to do – weaken the ruble and thereby weaken Putin and hope he changes course in Ukraine? And now that the Russian people are facing real economic hardship, is it the right time for more sanctions in order to try to force a de-escalation in Ukraine, or should Moscow be given some breathing space in order to prevent an economic meltdown which could have an effect on the global economy?
And just turning back to what you mentioned – and you talked about the Taliban, the attack in Peshawar today, and the hostage-taking in the cafe in Sydney yesterday – what is your assessment of the rising threat level from Islamic extremism around the world? Is it now, would you agree, at one of its highest levels ever, despite the United States efforts to try and counterattack this? And how could governments around the world protect their people from what seems to be a growing trend towards lone wolf attacks? Thank you.
SECRETARY KERRY: Well, obviously, everybody has taken note of what has happened with respect to the ruble in the last days and the pressures on it, and it goes without saying that the purpose of the European-U.S.-et al effort with respect to sanctions was to make it clear to Russia, to President Putin, that there are costs attached to the unilateral annexation of Crimea and the continued support for separatists within Ukraine and the violation of Ukraine’s territorial sovereignty and integrity, and the sanctions set out to do that. I don’t think that what is happening is just related to the sanctions. I think it is much broader, more complicated than that. It has to do with other issues with respect to the Russian economy, and oil prices, obviously, have also played a significant role in this. So there are a lot of combined factors, but the sanctions were clearly intended to invite President Putin to make a different set of choices.
Now, these sanctions could have been lifted months ago. These sanctions could be lifted in a matter of weeks or days, depending on the choices that President Putin takes. And we have been crystal clear – when I say “we,” the European community and the United States and others joined together have been crystal clear that their sole purpose here is to restore the international norm with respect to behavior between nations with respect for borders and respect for sovereignty and respect for the rights of people to determine their future not at the barrel of a gun, but through the ballot box.
Let me say that Russia has made constructive moves in the last days and there are some indications that whether it is the line of control negotiation or the calm that is, in fact, in place in a number of places, the withdrawal of certain people, there are signs of constructive choices. And that can only be helpful, hopefully. And our hope is that in the days ahead we can get a clear, defined path by all parties, where everybody understands what each is doing and living up to agreements and in moving to de-escalate this situation. That has always been our goal. And I’m confident that as rapidly as that can happen, you will see Europe and the United States respond with respect to the sanctions that are in place today.
We do not want the people of Russia to be hurt here. This is not our goal. None of what we are doing is targeted specifically against the people. But yes, collaterally, of course, they are caught up in the choices that their government makes and it does have an impact. We understand that. But that’s not the goal or purpose.
QUESTION: Please, on the (inaudible) on the fight against the Islamists?
SECRETARY KERRY: Oh, on the fight against extremism, is the threat – no, I’m not going to say – the threat is what the threat is. There’s always been a threat of lone wolves, from the day that those terrorists drove their airplanes into the World Trade Center and crashed in Pennsylvania, and crashed into the Pentagon, we’ve had warnings of lone wolf activities. We’ve had warnings of sleeper cells. We’ve had warnings. And there have been many, many attempts over the course of the last years. The New York attempt for a bombing in Times Square, the Christmas bomber on an airplane, and so forth. But because of great work between our countries and terrific intelligence sharing, we were able to prevent those things from happening.
But it’s always very difficult. If somebody decides they want to die, it’s very hard to prevent every situation from occurring. So I’m not going to categorize on the scale, but everybody knows that Daesh is busy using the internet to proselytize, to entice, to lie, to put out propaganda, to try to influence minds of people who may be influenceable. And so that does present a threat, and people, unfortunately, everywhere need to be sort of aware of their surroundings, more alert than we’d like to be or want to be in the context of everyday life, but that’s where we are right now.
But as I said last week, we are making progress in the initial stages of halting Daesh’s progress in Iraq, of beginning to change their behavior, of attacking their command and control, of attacking their facilities and denying them supplies, of beginning to cut off financing, beginning to reduce the flow of foreign fighters, and so we have to be tough and courageous and stay the course here. And I’m confident that people are prepared to do that, and I know that our friends in Pakistan and in Australia are tough and strong and prepared to stay the course. So it’s very unfortunate when this happens, but it is done precisely for the kind of effect that it gets, which is questions at a press conference and fears that are spread in various parts of the world.
MS. HARF: Thank you, everyone.
SECRETARY KERRY: Thank you all very much. Appreciate it.
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