FORMER GOVERNMENT EMPLOYEE ADMITS TO TAKING BRIBES FROM CONTRACTORS

FROM: U.S. DEPARTMENT OF JUSTICE

Thursday, February 14, 2013
Georgia Woman Admits to Taking Bribes for the Award of Government Contracts

A former employee at the Marine Corps Logistics Base Albany pleaded guilty today to receiving bribes related to the award of contracts for machine products, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Michael J. Moore for the Middle District of Georgia.

Michelle Rodriguez, 32, of Albany, Ga., pleaded guilty before U.S. District Judge W. Louis Sands in the Middle District of Georgia to one count of bribery of a public official.

During her guilty plea, Rodriguez, who worked as a supply technician in the Maintenance Center Albany (MCA), admitted to participating in a scheme to award contracts for machine products to companies operated by Thomas J. Cole and Frederick Simon, both of whom pleaded guilty to bribery charges in January 2013.

According to court documents, the MCA is responsible for rebuilding and repairing ground combat and combat support equipment, much of which has been used in military missions in Afghanistan, Iraq and other parts of the world. To accomplish the scheme, Rodriguez would transmit bid solicitations to Simon by fax or email, usually following up with a text message specifying how much the company seeking the contract should bid. Simon, with Cole’s knowledge, would then bid the amount specified by Rodriguez on each order, which was normally higher than fair market value. Rodriguez was paid $75.00 cash per order. Rodriguez admitted during today’s hearing that she awarded Cole and Simon’s companies nearly 1,300 machine product orders, all in exchange for bribes.

Rodriguez also admitted that in 2011, she began routing some orders through a second company, owned by Cole, because the volume of orders MCA placed with the first company was so high. Rodriguez admitted receiving approximately $161,000 in bribes during the nearly two-year scheme. Cole and Simon previously admitted to personally receiving approximately $209,000 and $74,500 in proceeds from the scheme, respectively. Rodriguez, Cole and Simon all conceded that the total loss to the Department of Defense from overcharges associated with the machine product orders placed during the scheme was approximately $907,000.

At sentencing, Rodriguez faces a maximum potential penalty of 15 years in prison and a fine of twice the gross gain or loss from the offense. As part of her plea agreement with the United States, Rodriguez agreed to forfeit the bribe proceeds she received from the scheme, as well as to pay full restitution to the Department of Defense. The plea agreement also required her to resign her position at the MCA. Sentencing is scheduled for April 25, 2013.

MAN SENTENCED FOR SELLING MILLIONS IN FRAUDULENT RENEWABLE FUEL CREDITS

Fried Cheese Curds.  Credit:  Wikimedia Commons.

FROM: U.S. ENVIRONMENTAL PROTECTION AGENCY
Rodney Hailey Sentenced to More Than 12 Years in Prison for Selling $9 Million in Fraudulent Renewable Fuel Credits

Owner of "Clean Green Fuel" falsely claimed his company produced 23 million gallons of renewable fuel

WASHINGTON - U.S. District Judge William D. Quarles, Jr. sentenced Rodney R. Hailey, of Perry Hall, Md., today to nearly 12 years and six months in prison, followed by three years of supervised release, for selling $9 million in renewable fuel credits which he falsely claimed were produced by his company, Clean Green Fuel, LLC.

"When invalid renewable fuel credits are ‘produced’ and sold, it undermines the integrity of an important program designed by Congress to reduce the nation’s dependence on foreign oil and to grow the nation’s renewable energy industry," said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. "Today’s sentence shows that there are serious consequences, including jail time, for defrauding the renewable fuels program for personal gain."

"Any government program that is based on trust is vulnerable to a fraudster like Rodney Hailey," said U.S. Attorney Rod J. Rosenstein. "The only thing Rodney Hailey’s ‘Clean Green Fuel’ business produced was the dirty money he used to fund his lavish lifestyle."

Judge Quarles enhanced Hailey’s sentence upon finding that he obstructed justice by concealing, selling and spending assets that were protected by court order. Judge Quarles also ordered Hailey to pay restitution of approximately $ 42.2 million to over 20 companies and forfeit $9.1 million in proceeds from the fraud, including cars, jewelry, his home and bank accounts, already seized by the government.

Hailey, age 34, was convicted on Jun. 25, 2012, of eight counts of wire fraud, 32 counts of money laundering, and two counts of violating the Clean Air Act. He has been detained since the guilty verdict.

According to evidence presented at the six day trial, Hailey owned Clean Green Fuel, LLC, located in the Baltimore, Md. area. Hailey registered Clean Green Fuel with EPA under the Renewable Fuel Standard (RFS) program as a producer of bio-diesel fuel, a motor vehicle fuel derived from renewable resources. To encourage the production of renewable fuel and lessen the nation’s dependence on foreign oil, all oil companies that market petroleum in the U.S. are required to produce a given quantity of renewable fuel or to purchase credits, called renewable identification numbers (RINs) from producers of renewable fuels to satisfy their renewable fuel requirements.

Between March 2009 and December 2010, Hailey engaged in a massive fraud scheme, selling over 35 million RINs (representing 23 million gallons of bio-diesel fuel) to brokers and oil companies, when in fact Clean Green Fuel had produced no fuel at all and Hailey did not have a facility capable of producing bio-diesel fuel.

Federal law enforcement agents investigated the scheme after a Baltimore County police detective working with Maryland’s federal financial crimes task force received a report about the large number of luxury cars parked in front of Hailey’s house. The financial crimes task force contacted EPA’s Criminal Investigation Division and initiated a criminal investigation.

Two civil inspectors from EPA’s Air Enforcement Division visited Clean Green’s headquarters on Jul. 22, 2010, to inspect Hailey’s bio-diesel production facility, in response to a complaint alleging that Clean Green had been selling false RINs. Hailey was not able to provide an exact location for the bio-diesel fuel production facility, nor any records to support claims that Clean Green Fuel had produced bio-diesel fuel. When asked to explain his method of production, Hailey falsely stated that he paid employees and contractors to recover waste vegetable oil from 2,700 restaurants in the "Delmarva" area, a peninsula that includes parts of Delaware, Virginia and Maryland, and bring it to his production facility where he converted it to bio-diesel fuel. Hailey claimed that only the drivers who picked up the oil knew the names of the restaurants, and Hailey could not provide the names of the drivers.

Hailey made more than $9.1 million from selling the false RINs. Hailey used the proceeds of the scheme to purchase luxury vehicles, including BMWs, Mercedes Benz, a Rolls Royce Phantom, a Lamborghini, Ferrari, Maserati and others, as well as real estate and more than $80,000 in diamond jewelry. In all of these transactions, Hailey generally used cash or checks drawn on accounts he controlled to make the purchase, including a check for $645,330.15 to buy his home in Perry Hall, Md.

The loss to the traders and major energy companies who purchased Hailey’s false RINs is more than $40 million, but the loss also extends to small bio-diesel companies, many of which, as a result of Hailey’s scheme, were unable to sell their RINs and have been forced out of business.

EPA recently proposed a voluntary quality assurance program to verify that RINs generated under the RFS program have been validly generated. EPA expects that this will promote greater liquidity in the transfer and use of RINs, helping to make the RFS program more efficient and effective.

SALMONELLA-TAINTED PEANUTS ALLEGEDLY DISTRIBUTED IN U.S.

Peanuts.  Credit:   Wikimedia Commons.

FROM: U.S. DEPARTMENT OF JUSTICE
Thursday, February 21, 2013
Former Officials and Broker of Peanut Corporation of America Indicted Related to Salmonella-Tainted Peanut Products

Allegations Include Mail and Wire Fraud, Introduction of Adulterated and Misbranded Food into Interstate Commerce with Intent to Defraud or Mislead, and Conspiracy

A 76-count indictment was unsealed yesterday charging four former officials of the Peanut Corporation of America (PCA) and a related company with numerous charges relating to salmonella-tainted peanuts and peanut products, the Justice Department announced today. Stewart Parnell, 58, of Lynchburg, Va.; Michael Parnell, 54, of Midlothian, Va.; and Samuel Lightsey, 48, of Blakely, Ga., have been charged with mail and wire fraud, the introduction of adulterated and misbranded food into interstate commerce with the intent to defraud or mislead, and conspiracy. Stewart Parnell, Lightsey and Mary Wilkerson, 39, of Edison, Ga., were also charged with obstruction of justice.

Also yesterday, an information filed against Daniel Kilgore, 44, of Blakely was unsealed. On the same day that charges against Kilgore were filed, he pleaded guilty to that information, which charged him with mail and wire fraud, the introduction of adulterated and misbranded food into interstate commerce with the intent to defraud or mislead, and conspiracy.

The investigation into the activity at PCA began in 2009, after the Food and Drug Administration and the U.S. Centers for Disease Control and Prevention traced a national outbreak of salmonella to a PCA plant in Blakely as the likely source. As alleged in the indictment, the Blakely plant was a peanut roasting facility where PCA roasted raw peanuts and produced granulated peanuts, peanut butter, and peanut paste; PCA sold these peanut products to its customers around the country.

The charging documents charge that Stewart Parnell, Michael Parnell, Lightsey and Kilgore participated in a scheme to manufacture and ship salmonella-contaminated peanuts and peanut products, and in so doing misled PCA customers. As alleged in the indictment, those customers ranged in size from small, family-owned businesses to global, multibillion-dollar food companies.

"When those responsible for producing or supplying our food lie and cut corners, as alleged in the indictment, they put all of us at risk," said Stuart F. Delery, who heads the Justice Department’s Civil Division. "The Department of Justice will not hesitate to pursue any person whose criminal conduct risks the safety of Americans who have done nothing more than eat a peanut butter and jelly sandwich."

Although PCA is now no longer in business, the allegations against each of the defendants arise from his or her conduct while at PCA and a related company. The following allegations are set forth in the indictment: Stewart Parnell was an owner and president of PCA; Michael Parnell, who worked at P.P. Sales, was a food broker who worked on behalf of PCA; Lightsey was the operations manager at the Blakely plant from on or about July 2008 through February 2009; and Wilkerson held various positions at the Blakely plant – receptionist, office manager and quality assurance manager – from on or about April 2002 through February 2009. As charged in the information, Kilgore served as operations manager of the PCA plant in Blakely from on or about June 2002 through May 2008.

"We all place a great deal of trust in the companies and individuals who prepare and package our food, often times taking it for granted that the public’s health and safety interests will outweigh individual and corporate greed," said Michael Moore, U.S. Attorney for the Middle District of Georgia. "Unfortunately and as alleged in the indictment, these defendants cared less about the quality of the food they were providing to the American people and more about the quantity of money they were gathering while disregarding food safety. This investigation was complex and extensive, and I credit the cooperation of our federal agencies with not only making sure that the cause of this outbreak was uncovered and the people responsible called to account, but also with working hard every day to make sure that parents across the country can feel confident that the food they are feeding their children is safe."

The charging documents allege that Stewart Parnell, Michael Parnell, Lightsey and Kilgore participated in several schemes by which they defrauded PCA customers about the quality and purity of their peanut products and specifically misled PCA customers about the existence of foodborne pathogens, most notably salmonella, in the peanut products PCA sold to them. As the charging documents allege, the members of the conspiracy did so in several ways – for example, even when laboratory testing revealed the presence of salmonella in peanut products from the Blakely plant, Stewart Parnell, Michael Parnell, Lightsey and Kilgore failed to notify customers of the presence of salmonella in the products shipped to them.

In addition, the charging documents allege that Stewart Parnell, Michael Parnell, Lightsey and Kilgore participated in a scheme to fabricate certificates of analysis (COAs) accompanying various shipments of peanut products. COAs are documents that summarize laboratory results, including results concerning the presence or absence of pathogens. As alleged in the charging documents, on several occasions these four defendants participated in a scheme to fabricate COAs stating that shipments of peanut products were free of pathogens when, in fact, there had been no tests on the products at all or when the laboratory results showed that a sample tested positive for salmonella.

After the salmonella outbreak that gave rise to this investigation, FDA inspectors visited the plant several times in January 2009. According to the indictment, the inspectors asked specific questions about the plant, its operations, and its history, and, in several instances, Stewart Parnell, Lightsey and Wilkerson gave untrue or misleading answers to these questions.

"The charges announced today show that if an individual violates food safety rules or conceals relevant information, we will seek to hold them accountable," said FDA Commissioner Margaret A. Hamburg, M.D. "The health of our families and the safety of our food system is too important to be thwarted by the criminal acts of any individual or company."

Stewart Parnell, Michael Parnell, and Samuel Lightsey are each charged with two counts of conspiracy; multiple counts of introducing adulterated food into interstate commerce with the intent to defraud; multiple counts of introducing misbranded food into interstate commerce with the intent to defraud; multiple counts of interstate shipment fraud; and multiple counts of wire fraud. Stewart Parnell, Lightsey and Wilkerson are also charged with multiple counts of obstruction of justice.

Kilgore pleaded guilty to one count of conspiracy to commit fraud, one count of conspiracy to introduce adulterated and misbranded food into interstate commerce, eight counts of introducing adulterated food into interstate commerce with the intent to defraud, six counts of introducing misbranded food into interstate commerce with the intent to defraud, eight counts of interstate shipment fraud, and five counts of wire fraud.

Mark F. Giuliano, Special Agent in Charge, FBI Atlanta Field Office, stated, "The FBI was brought in to this matter to provide additional resources and expertise to a complex and very serious investigation. We fully understand the victim impact as a result of this salmonella outbreak and will be asking to hear from other possible victims in this matter."
The case is being prosecuted by Trial Attorneys Patrick Hearn and Mary M. Englehart of the Consumer Protection Branch of the Civil Division of the Department of Justice and Assistant U.S. Attorney Alan Dasher of the Middle District of Georgia. Marietta Geckos, formerly a Trial Attorney with the Consumer Protection Branch, also worked on the prosecution. The case was investigated by the Food and Drug Administration’s Office of Criminal Investigations and the FBI.

An indictment is merely an allegation, and every defendant is presumed innocent until proven guilty beyond a reasonable doubt.

THE COLORS OF MERCURY

FROM:  NASA
This colorful view of Mercury was produced by using images from the color base map imaging campaign during MESSENGER's primary mission. These colors are not what Mercury would look like to the human eye, but rather the colors enhance the chemical, mineralogical, and physical differences between the rocks that make up Mercury's surface.

Mercury,Image Credit-NASA-Johns Hopkins University Applied Physics Laboratory-Carnegie Institution of Washington

U.S. CONDEMS ALEPPO ATTACKS

FROM: U.S. DEPARTMENT OF STATE
United States Condemns Attacks on Aleppo
Press Statement
Victoria Nuland
Department Spokesperson, Office of the Spokesperson
Washington, DC
February 23, 2013

The United States Government condemns in the strongest possible terms the series of rocket attacks against Aleppo, most recently the attack using Scud missiles on an eastern district of the city late on Friday, February 22, that killed several dozen people. The Friday attack follows the assault on Aleppo of Tuesday, February 19, that destroyed several city blocks in the Jabal Badr district of Aleppo and injured hundreds of innocent civilians. These attacks, as well as other atrocities such as the strike against a field hospital earlier in the week, are only the latest demonstrations of the Syrian regime's ruthlessness and its lack of compassion for the Syrian people it claims to represent.

The Assad regime has no legitimacy and remains in power only through brute force. From the city of Deir Zour in the far eastern part of Syria to the mountains of Jebel Akrad near the Mediterranean, Syrians across the country have demanded that Assad, and the architects of his violent campaign, step aside and allow a Syrian-led political transition to begin so that the rights of all Syrians can be respected, and the country can begin to rebuild. The United States sees no indication that the brave Syrian people fighting against this aggression will accept these regime leaders, with the blood of so many Syrians on their hands, as part of a transition governing authority.

The United States has contributed $385 million to help Syrian refugees and citizens inside Syria who have been displaced by regime violence. As the regime strikes out against more and more civilians, we have increased our humanitarian aid in close coordination with Syrian activists, and we have urged other countries to do so as well. We also have helped local administrative councils, provincial revolution councils and the local coordination committees organize themselves to play their vital role in the revolution. We look forward to meeting soon with the leadership of the legitimate representative of the Syrian people, the Syrian Opposition Coalition, to discuss how the United States and other friends of the Syrian people can do more to help the Syrian people achieve the political transition that they demand and that they deserve

DRILLING ON MARS VIDEO

FROM: NASA
Drilling into Mars

This animation of NASA's Curiosity rover shows the complicated suite of operations involved in conducting the rover's first rock sample drilling on Mars and transferring the sample to the rover's scoop for inspection. The drilling and sample transfer took place on Feb. 8 and 20, 2013, or sols 182 and 193, Curiosity's 182nd and 193rd Martian days of operations.

Weekly Address: Congress Must Act Now to Stop the Sequester | The White House

Weekly Address: Congress Must Act Now to Stop the Sequester | The White House

REMARKS BY U.S. SECRETARY OF STATE KERRY AND JAPANESE FOREIGN MINISTER KISHIDA

FROM: U.S. STATE DEPARTMENT
Remarks With Japanese Foreign Minister Fumio Kishida Before Their Meeting
Remarks
John Kerry
Secretary of State
Treaty Room
Washington, DC
February 22, 2013


SECRETARY KERRY: Good afternoon, everybody. It’s my great pleasure to welcome the Foreign Minister of Japan, His Excellency Fumio Kishida. We’ve just come from an excellent meeting of the President and the Prime Minister of Japan, and I think it’s fair to say that almost every topic with respect to Japanese-American relations was discussed.

We meet now, two of the three strongest economies in the world, and we meet as very special friends in a very strong alliance, an alliance that I can say to you is really evolving into a global partnership and which is critical to the peace and security of the Asia Pacific.

I want to particularly thank the people of Japan and the leadership of Japan for their extraordinary cooperation on a number of global issues: on counterterrorism - the efforts with respect to Afghanistan; where Japan has been a major partner - efforts in Mali most recently; where we regret the loss of life and we particularly express our sympathies to Japan for the loss of 10 citizens at the In Amenas facility. And Japan has worked hard with respect to the issue of nuclear nonproliferation. They have been an important partner in reducing the level of fuel being used and bought, purchased from Iran. They’ve been important with respect to the enforcement of sanctions.

Japan is also a very important partner in efforts to try to reduce global greenhouse gas emissions, and the Prime Minister raised this issue in the conversation with the President. And Japan, importantly, has been part of the Major Economies Forum and the Clean Climate Coalition and other initiatives, and I think the Minister and I look forward to following up on the discussion that was initiated by the President and the Prime Minister earlier.

Just to underscore the importance of the relationship with Japan, obviously everybody has been aware of tensions around the Senkakus Islands, and I want to compliment Japan on the restraint that it has shown, its efforts to try to make sure that this does not flare up into a significant confrontation. And we make it clear with respect to the Republic of – the Democratic Republic of North Korea, which has recently engaged in very reckless behavior with its nuclear test, that we believe the alliance with Japan is strong, our security commitments with Japan are real and we stand behind them, and they are strong.

So I welcome the Foreign Minister here. There are a number of things that are less critical, I think, that we will be talking about, but I look forward to a good discussion. And most importantly, I look forward to this very important continued global alliance and partnership that we have built. Thank you for visiting us, Minister.

FOREIGN MINISTER KISHIDA: (Via interpreter) Let me start by saying that I appreciate the kind and powerful messages and words from Secretary Kerry with regard to Japan. Right after taking office as Secretary of State, we have had two opportunities so far to talk to each other over the phone, and this is our first meeting – face-to-face meeting, and certainly it is my pleasure to see you in person this time.

With Mr. Secretary, I certainly have looked forward to having discussions on the Japan-U.S. alliance, as well as how we respond to the situations in the Asia Pacific, in the Middle East, as well as the Sahel, and also how we look forward to working on global issues such as counterterrorism and also the issue of environment. And I certainly look forward to having a discussion, and also, by doing so, we would like to deepen our cooperation.

Just a while ago both Mr. Secretary and myself attended the Japan-U.S. summit meeting and during the meeting both leaders had a candid discussion to cover issues such as the economy, security affairs, as well as foreign policy challenges. And I would like to underscore that the meeting was indeed very meaningful. And right now we are going to have the Japan-U.S. foreign ministers meeting with Mr. Secretary, and by having this meeting we would like to do a follow-up based on the outcome of the discussion of the summit meeting. And also, we would like to have the exchange of opinions on the regional affairs.

Obviously, the Japan-U.S. alliance is a lynchpin of the – Japan’s foreign policy, and by working together hand in hand with Mr. Secretary, we would like to achieve progress in reinforcing the Japan-U.S. alliance. And once again, thank you very much for taking the time out to have the foreign ministers meeting today.

SECRETARY KERRY: Thank you very much. Thank you.

SECRETARY OF DEFENSE PANETTA GIVES PRESS CONFERENCE AT NATO HEADQUARTERS

FROM: U.S. DEPARTMENT OF DEFENSE
Presenter: Secretary of Defense Leon E. Panetta February 22, 2013
Press Conference with Secretary Panetta at NATO Headquarters, Brussels, Belgium

SECRETARY OF DEFENSE LEON E. PANETTA: Let me begin by welcoming everyone to what should be my final press conference on this -- the last of my international trips as secretary. I've been saying that a lot lately, but my hope is that this time it really works.

Truthfully, I have appreciated the opportunity to be here and to be able to consult with my fellow NATO and ISAF defense ministers one last time as secretary of defense. And I should say that I deeply appreciate all of their -- their kind comments to me and also to Giampaolo. Both -- both Italians are going to be moving on.

Foremost on the agenda has been the mission in Afghanistan, which was the focus, as many of you know, of this morning's session and a key topic of my bilateral meetings over the last two days. In my discussions with the other ministers of defense, there is a strong consensus that our mission is succeeding, it's succeeding on the ground because of the growing role and capabilities that all of us have seen of the Afghan National Security Forces.

The ANSF are now in the lead for nearly 90 percent of combat operations. And they are on track to step into the lead for all of these operations by this spring. That has truly exceeded the expectations that were set at the Chicago summit last year, but it is as a result of their success in the field that General Allen, in particular, felt that we could make that transition in the spring.

This success led President Obama to accept General Allen's recommendation that the U.S. maintain a strong presence, once we've made this transition of combat control to the Afghans, that it was important for the United States to maintain a strong presence throughout the fighting season of 2013. What we're looking at is probably a presence in excess of 60,000 during the fighting season through the final transition of tranche five, which would take place in August of 2013.

Following that, sometime in the fall, we would then begin a drawdown that would take us to roughly about 50,000 by November, and then it would take us down, as the president indicated, to 34,000 by February of 2014. We would maintain that number through the election in order to provide and assist the Afghans in providing sufficient security for the elections. Once those elections were completed, we would then begin the final drawdown of our forces towards the end of 2014. I have full confidence that we'll be able to achieve our goal of giving the ANSF full responsibility for security nationwide by the end of 2014 and successfully complete this mission.

As my Italian father used to say in an old expression that he repeated oftentimes, "piano piano te va lontano," which means, "Step by step, you'll go a long way." And I think that's probably good advice for all of us as we approach this final period, hopefully, in the completion of the mission that we've been engaged in, in Afghanistan.

As we draw closer to the end of our combat mission, the alliance has also begun to discuss how to implement our strong commitment to the long-term security of Afghanistan. In particular, we discussed how we could best continue to support the ANSF, building on the commitments that nations made last year in Chicago.

That continued support includes enablers and the possibility of providing funding to extent the ANSF at the surge level of 352,000 through 2018, before moving towards what would then be, hopefully, a more sustainable number. That is seriously being considered by the president, and it's something we discussed with President Karzai when he came to Washington.

We also discussed how to transition to our new train, advise, and assist mission after 2014. Today, we ask NATO to begin planning for a range of options on the post-2014 posture that would provide for an effective regional presence, not only in Kabul, but at fixed sites in the north, the south, the east, and the west.

As the United States weighs our own force posture options and consults with the Afghan government on a post-2014 presence, we will continue to work very closely with ISAF nations, particularly the other regional lead nations, to continue to discuss a range of options with regards to what the NATO force will look like in that post-2014 period. And our goal is obviously to ensure the success of this new mission and the long-term stability of Afghanistan. We've made a commitment to a strong enduring presence, and we intend to stand by that commitment.

As I prepare to leave NATO headquarters, I can say that, among the things that I am most proud of as secretary is the success of our troops that have been able to achieve the kind of successful direction that we've been able to achieve on the ground in Afghanistan and the extraordinary unity and strength and resolve of ISAF.

I had the opportunities a number of times to go to Afghanistan. This last time, I went to Afghanistan, had the opportunity to meet with all of our military leaders in the field. And to a person, each of them said that -- that this mission was headed in the right direction, and they all expressed confidence in the growing capability of the Afghan force to be able to handle security and to take on the enemy.

We've laid the groundwork for how our nations can come together to resolve the security challenges of the 21st century, including emerging challenges like the threat posed by violent extremism in North Africa and cyber attacks. I think the ability of having pulled together this great alliance and the effort in Afghanistan can really serve us as a model for how we decide to take on other challenges in the world that will confront us.

To resolve these challenges together, we must really commit to acting together. And there's no question that in the current budget environment, with deep cuts in European defense spending, the kind of political gridlock that we're seeing in the United States right now with regards to our own budget, is putting at risk our ability to effectively act together.

As I prepare to step down as secretary of defense, I do fear that the alliance will soon be -- if it is not already -- stretched too thin. In our sessions devoted to these topics, the questions I asked my fellow ministers were simple. Will we let our nations retreat from our responsibilities in the face of growing budget constraints? Or will we demonstrate the kind of creativity and innovation and political will to develop and share the capabilities we must have in order to meet future security threats together as an alliance?

The choice for our allies is clear. And I want to commend Secretary General Rasmussen for his leadership in warning against the effect of budget cuts and in proposing new ideas, like the Connected Forces Initiative, that will help our militaries continue to train and operate together, even as our deployments to Afghanistan are reduced.

These are critical to ensuring the readiness of the alliance, which has to be the top priority in an unpredictable and crisis-prone world. I'd also like to commend the secretary general for making cyber a major area of focus for the next defense ministerial. It's a call that I made upon NATO that they should do. We have seen -- we are seeing continuing attacks in the cyber arena on the private sector, on the public sector, in the defense arena. This is, without question, the battlefield for the future, and it's an area that NATO needs to pay attention to.

Let me conclude by noting, as I did last month in a speech that I gave in London, that there is a generational shift that is occurring. I'm probably the last American secretary of defense to have direct memories of World War II. And our youngest men and women in uniform today were born after the end of the Cold War.

The bonds that formed the basis of our alliance were built on the basis of those 20th century conflicts. But over more than a decade of war in Afghanistan, I believe we have renewed those bonds for the 21st century and carried out the most enduring and effective alliance campaign since World War II. If we have the strength to carry those bonds forward, then I believe that we can realize our shared dream of a better and more peaceful and more secure world for future generations. Thank you.

GEORGE LITTLE: The secretary is pleased to take a few questions. We'll start with the Associated Press. Or we'll start with Bloomberg.

Q: Thank you, Mr. Secretary. Gopal Ratnam with Bloomberg News. Good luck to you as you leave and head back to your beloved California. I want to ask you two questions. This morning, the German defense minister has told reporters that you had expressed to him the U.S. would keep between 8,000 and 12,000 troops in Afghanistan post-2014. One, would you confirm that? And, second, in your discussions with your counterparts here in NATO, what kind of commitments do you ask of them post-2014? And what kind of promises have you got or what kind of concerns have they expressed to you about their commitments?

SEC. PANETTA: First of all, that report is not correct. We did discuss a range of options. And what we discussed was a range of options that would -- that would be directed to the NATO force overall, which includes both the U.S. force contribution that we would make, plus what other NATO countries would contribute, as well.

And that -- those options are there. NATO will continue to do a planning process around those options. And we will be working with them as we develop the final decisions that the president makes with regards to our commitment to that enduring presence.

With regards to the 2014 period, we did describe that we felt it was important to develop this regional approach to be able to have a presence in some of the key areas in the northwest, east, and south, to be able to have a presence, obviously, in Kabul, that we would provide -- continue to provide enabling capabilities, particularly on a strategic level, with regards to those forces, and that we would continue to work with them to develop what the train, advise, and assist mission should look like. So we're going to be continuing to work on that.

And that was -- I have to say -- there was good receptivity among all of the ministers with regards to the broad elements that I described during this last session.

Q: (off mic)

SEC. PANETTA: Pardon me?

Q: (off mic)

SEC. PANETTA: All of -- all of the ministers, a number of the ministers spoke. And I have to say that all of the ministers who spoke indicated that they appreciated the outlines that we presented and that they, too, were committed to an enduring presence. So I feel very confident that we are going to get a number of nations to make that contribution for the enduring presence.

MR. LITTLE: Yes, sir?

Q: It's (inaudible) from German television ZDF. I just heard the same thing, that the minister of defense of Germany said 8,000 to 12,000, so I just would like to make that understandable for me. So you say altogether there might be 8,000 to 12,000, is the contribution of the U.S. troops even less than 8,000 to 12,000? Or -- and in which region would you like to place troops?

SEC. PANETTA: What -- what we discussed was a range of options. I don't want to go into particular numbers, because, frankly, we want -- we want to be able to have the flexibility to look at a range of options that we ought to have for our enduring presence. But I want to make very clear that the range of options we were discussing was with regards to the NATO force.

And the NATO force consists of both a U.S. presence, plus NATO contributions. And we didn't define specifics on that. Frankly, that remains to be determined as we go forward with the planning process.

MR. LITTLE: Now the Associated Press.

Q: All right, thank you. Thank you, Mr. Secretary. The discussion about extending and maintaining 352,000 Afghan troops for the next five years, can you talk a little bit about how you're going to be able to go to the U.S. Congress and defend something like that, when just the other day you had to issue public notice of furloughs for 800,000 civilian workers? How can you defend increasing this amount of spending when, obviously, the Defense Department in the United States is in deep financial problems?

SEC. PANETTA: Well, I think -- I mean, look, first and foremost, with regards to the crisis that we confront in the United States, the fact is, as I've said, that this, frankly, should not be a crisis. This is a -- this is a political crisis. It's not a crisis that relates to our capabilities within the budget that we've defined for the Defense Department.

And my hope is that -- that Congress does not allow sequester to take place. I think it would be, frankly, a very shameful and irresponsible act of political dysfunction if, in fact, that were to occur. The American people would be justly outraged to have people who they elect to office to protect them harm them by allowing sequester to take place.

So I guess my -- what I want to make clear is that sequester is -- is by no means -- doesn't reflect the budget that we have put in place to implement our strategy. It would be -- it would be truly an act of -- of irresponsibility if it happened.

And then I -- in terms of the consequences of sequester, I have to say, if sequester does take place, it could impact not only our readiness, but, frankly, the role that we would play with regards to the readiness of NATO, as well. So all of that would be impacted if that occurred.

Assuming that doesn't happen, then our view is that we -- you know, if the president makes the decision to continue the ANSF presence at 352,000, that that would be an investment that would be worth making, because it would allow us greater flexibility as we take down our troops, and it would allow us greater flexibility, frankly, to save in the funds that we now dedicate to the warfighting effort. And I think I can make that case to the Congress, that that would be an effective tradeoff.

MR. LITTLE: We have time for one more question. Yes, sir? And we'll wrap it up.

Q: (Inaudible), Tolo TV Afghanistan. Sir, most of the Afghans believe that the U.S. will abandon Afghanistan again when the combat mission finishes in Afghanistan. What type of guarantee you can give them, sir? Because on one hand, Taliban still pose a serious threat to the Afghan government, and the peace process is also not going well.

SEC. PANETTA: I -- you know, I want to make clear that -- that the United States and ISAF, the NATO -- the NATO countries that are involved in the ISAF effort, all of us are committed to supporting Afghanistan, not just now, but in the future. And that commitment is unwavering.

And the best example of that commitment is that we are going to maintain in excess of 60,000 troops there even after we've made the transition to the Afghans for combat responsibility. So we will maintain a significant presence there through a key fighting season and through the final transition of areas. And even as we draw down, we'll still maintain a significant presence there throughout the Afghan election.

And beyond that, we will maintain an enduring presence to be able to fulfill two key missions, to be able to train, assist and continue to support the Afghan army and defense force, and in addition to that, to conduct counterterrorism activities to make sure that Al Qaida and its affiliates never again are able to establish a safe haven there.

So I -- in the discussions I've had, both with President Karzai, with the defense minister, and with others, we have made very clear that we have a continuing and dedicated commitment to make sure that Afghanistan is a country that ultimately can govern and secure itself.

MR. LITTLE: Thank you, everyone. Have a good afternoon.

U.S. JOINS LAWSUIT AGAINST LANCE ARMSTRONG AND OTHERS



FROM: U.S. DEPARTMENT OF JUSTICE

Friday, February 22, 2013
United States Joins Lawsuit Alleging Lance Armstrong and Others Caused the Submission of False Claims to the U.S. Postal Service

The Department of Justice announced today that the government has joined a civil lawsuit alleging that Lance Armstrong, Johan Bruyneel and Tailwind Sports LLC and Tailwind Sports Corporation (Tailwind) submitted or caused the submission of false claims to the U.S. Postal Service (USPS) in connection with its sponsorship of a professional bicycle racing team by regularly employing banned substances and methods to enhance their performance, in violation of the USPS sponsorship agreements.

From 1996 through 2004, the USPS sponsored a professional cycling team owned by Tailwind and its predecessors. Lance Armstrong was the lead rider on the team, and between 1999 and 2004, he won six consecutive Tour de France titles as a member of the USPS-sponsored team. Johan Bruyneel was the directeur sportif, or manager, of the cycling team.

The sponsorship agreements gave the USPS certain promotional rights, including the right to prominent placement of the USPS logo on the cycling team’s uniform. Each of the agreements required the team to follow the rules of cycling’s governing bodies, which prohibited the use of certain performance enhancing substances and methods. Between 2001 and 2004 alone, the Postal Service paid $31 million in sponsorship fees.

The lawsuit joined today by the government alleges that riders on the USPS-sponsored team, including Armstrong, knowingly caused the USPS agreements to be violated by regularly employing banned substances and methods to enhance their performance. The lawsuit further alleges that Bruyneel knew that team members were using performance enhancing substances and facilitated the practice.

The government today notified the court that it is joining this lawsuit against Armstrong, Bruyneel and Tailwind, and will file its formal complaint within 60 days.

"The Postal Service contract with Tailwind required the team to enter cycling races, wear the Postal Service logo, and follow the rules banning performance enhancing substances – rules that Lance Armstrong has now admitted he violated," said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Civil Division of the Department of Justice. "Today’s action demonstrates the Department of Justice’s steadfast commitment to safeguarding federal funds and making sure that contractors live up to their promises."

"Lance Armstrong and his cycling team took more than $30 million from the U.S. Postal Service based on their contractual promise to play fair and abide by the rules – including the rules against doping," said Ronald C. Machen Jr., U.S. Attorney for the District of Columbia. "The Postal Service has now seen its sponsorship unfairly associated with what has been described as ‘the most sophisticated, professionalized, and successful doping program that sport has ever seen.’ This lawsuit is designed to help the Postal Service recoup the tens of millions of dollars it paid out to the Tailwind cycling team based on years of broken promises. In today’s economic climate, the U.S. Postal Service is simply not in a position to allow Lance Armstrong or any of the other defendants to walk away with the tens of millions of dollars they illegitimately procured."

"The Postal Service conducts business with many different contractors and subcontractors, with a large majority of them providing a much needed service and fulfilling their contractual duties. It is critical that public confidence in contractor performance remains high. When that public trust is compromised, as occurred in this case, the Office of Inspector General will fully investigate," said David C. Williams, Inspector General, U.S. Postal Service, and Office of Inspector General.

"The Postal Service strongly supports intervention by the Department of Justice in this matter and a vigorous pursuit of this case," said Postal Service General Counsel and Executive Vice President Mary Anne Gibbons. "The defendants agreed to play by the rules and not use performance enhancing drugs. We now know that the defendants failed to live up to their agreement, and instead knowingly engaged in a pattern of activity that violated the rules of professional cycling and, therefore, violated the terms of their contracts with the Postal Service. For that reason, the Postal Service fully agrees with the decision by the Department of Justice to seek appropriate damages under the False Claims Act."

For many years, including during the USPS sponsorships, Armstrong and others repeatedly denied that the team used performance enhancing substances or methods. Yet on Oct. 10, 2012, the U.S. Anti-Doping Agency (USADA) issued a report concluding that Armstrong used banned performance enhancing substances starting in at least 1998 and continuing throughout his professional career, and that he pressured and helped his teammates to engage in similar conduct. Accordingly, USADA disqualified all of his competitive results since Aug. 1, 1998, including his seven Tour de France victories, and banned him from sport for life pursuant to the World Anti-Doping Code.

In a recently-televised interview with Oprah Winfrey, Armstrong contradicted his earlier denials and admitted that he used banned substances and methods throughout his career, starting in the mid-1990s. In particular, he admitted having engaged in banned practices during each of his seven Tour de France victories, including the six he won as a USPS rider. Armstrong explained that he avoided detection by anti-doping authorities by carefully timing his use of banned drugs so that they would leave his system prior to his undergoing cycling’s required periodic drug testing.

The lawsuit joined by the United States was filed by Floyd Landis, a former rider and teammate of Armstrong on the USPS sponsored team from 2002 through 2004. The lawsuit was filed under the False Claims Act, which imposes liability on those who submit false claims for government funds, and provides for the recovery of three times the government’s damages, plus civil penalties. The False Claims Act contains a qui tam or whistleblower provision, which permits private parties to sue on behalf of the United States for false claims and share in any recovery. The False Claims Act permits the government to investigate the allegations and intervene, or decline to intervene in the whistleblower’s lawsuit. While the government notified the court that it was joining the lawsuit’s allegations as to Armstrong, Bruyneel, and Tailwind, it advised the court that it was not intervening in the case as to several other defendants named in the complaint.

Principal Deputy Assistant Attorney General Delery and U.S. Attorney Machen commended the coordinated effort of the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the District of Columbia, and the USPS Office of Inspector General and Office of General Counsel, in their investigation of this matter.

The lawsuit, filed in the U.S. District Court for the District of Columbia, is captioned United States ex rel. Landis v. Tailwind Sports Corporation, et al. The claims made in the complaint are only allegations and do not constitute a determination of liability. Trial Attorney Robert Chandler of the Department of Justice’s Civil Division and Assistant U.S. Attorneys Darrell Valdez and Mercedeh Momeni of the U.S. Attorney’s Office for the District of Columbia are representing the government.

NEW YORK MERCANTILE EXCHANGE, INC., CHARGED IN CONNECTION WITH DISCLOSURE OF CUSTOMER TRADES CASE

FROM: U.S. COMMODITY FUTURES TRADING COMMISSION 

CFTC Charges CME Group’s New York Mercantile Exchange and Two Former Employees with Disclosing Material Nonpublic Information about Customer Trades

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today filed an enforcement action charging the New York Mercantile Exchange, Inc. (CME NYMEX), which is owned and operated by the CME Group, and two former CME NYMEX employees, William Byrnes and Christopher Curtin, with violating the Commodity Exchange Act and CFTC Regulations through the repeated disclosures of material nonpublic customer information over of period of two and one-half years to an outside commodity broker who was not authorized to receive the information.

The CFTC’s Complaint, filed on February 21, 2013, in the U.S. District Court for the Southern District of New York, alleges that Byrnes and Curtin worked on the CME ClearPort Facilitation Desk and were responsible for facilitating customer transactions reported for clearing through the CME ClearPort electronic system. The Complaint alleges that at least from in or about February 2008 to September 2010, Byrnes knowingly and willfully disclosed material nonpublic information about CME NYMEX trading and customers, including about trades cleared through CME ClearPort, to a commodity broker on at least 60 occasions. The Complaint further alleges that between May 2008 and March 2009, Curtin knowingly and willfully disclosed the same type of information to the same commodity broker on at least 16 additional occasions. The nonpublic customer information unlawfully disclosed by Byrnes and Curtin in conversations — often captured on tape — included details of recently executed trades, the identities of the parties to specific trades, the brokers involved in trades, the number of contracts traded, the prices paid, the structure of particular transactions, and the trading strategies of market participants, according to the Complaint.

The Complaint alleges that the CME NYMEX and the two former employees violated the Commodity Exchange Act and CFTC Regulations, which specifically prohibit the disclosures of this type of customer information.

The CFTC’s Complaint also alleges that in July 2009, a market participant complained to CME NYMEX that the participant believed nonpublic information about trades cleared through CME ClearPort had been disclosed by a CME NYMEX employee named "Billy." Although a CME NYMEX Managing Director who investigated the market participant’s complaint identified "Billy" to be William Byrnes, CME NYMEX did not then question Byrnes, and Byrnes’s illegal disclosures continued for over a year, until at least September 2010. Ultimately, CME NYMEX terminated Byrnes’s employment in December 2010 after yet another market participant complained to CME NYMEX about disclosures of nonpublic customer information. Curtin had previously left CME NYMEX voluntarily.

In its continuing litigation, the CFTC seeks civil monetary penalties, trading and registration bans, and a permanent injunction prohibiting further violations of the federal commodities laws, as charged.

CFTC Division of Enforcement staff responsible for this case include Patrick Daly, James Wheaton, David W. MacGregor, Lenel Hickson, Stephen J. Obie, and Vincent A. McGonagle.

RECENT U.S. NAVY PHOTOS

FROM: U.S. NAVY
The Nimitz-class aircraft carrier USS Dwight D. Eisenhower (CVN 69) pulls away from the pier at Naval Station Norfolk for a deployment to support maritime security operation and theater security cooperation efforts in the U.S. 5th and 6th Fleet areas of responsibility, Feb. 21. (U.S. Navy photo by Mass Communication Specialist 2nd Class Ryan D. McLearnon-Released)

An MV-22 Osprey assigned to Marine Medium Tiltrotor Squadron (VMM) 265 takes off from the amphibious assault ship USS Bonhomme Richard (LHD 6) as another Osprey prepares for take-off. (U.S. Navy photo by Mass Communication Specialist 2nd Class Jerome D. Johnson-Released)

NATO MINISTERS DISCUSS TROOP STRENGTH IN AFGHANISTAN

Photo:  U.S. Drawdown In Afghanistan.  U.S. Army Photo.

FROM: U.S. DEPARTMENT OF DEFENSE
NATO Ponders Afghan Troop Strength, Official Says
By Karen Parrish
American Forces Press Service

BRUSSELS, Feb. 21, 2013 - NATO defense ministers gathered here are considering proposals to keep the number of Afghan national security forces at 325,000 for the next five years, according to a NATO official.

Defense Secretary Leon E. Panetta is here this week for the gathering of NATO defense ministers and representatives of non-NATO partner nations.

The official spoke to reporters on background, because the alliance and the Afghan government are still in discussions about the issue, and no final decision is expected soon.

Member nations fully realize that now, as the alliance enters a new phase of operations in Afghanistan and prepares to cut back on coalition troop strength, "we need to ensure that the Afghans are confident about the future," the official said.

Two narratives common among the Afghan people are working against success for coalition and Afghan forces, the official said: that coalition forces are there as occupiers, or that NATO will abandon Afghanistan after the transition to Afghan security lead is complete in 2014.

While the coalition has achieved "extraordinary progress" in defeating the Taliban and building Afghan forces, he said, it's now critical to address the Afghans' uncertainty.

Afghan soldiers and police are effective in their missions, but are increasingly distracted by fears about their personal futures, the official said. Coalition forces don't have to worry about whether they'll have a job, or get a paycheck, from year to year, he noted, but Afghan forces do.

If NATO can give Afghanistan's people solid assurances of the alliance's continued commitment beyond 2014, he said, "that's the one thing left, now, to advance the campaign forward."

U.S. State Department Daily Press Briefing - February 22, 2013

Daily Press Briefing - February 22, 2013

West Wing Week: 02/22/13 or “A Single Sacred Word: Citizen” | The White House

West Wing Week: 02/22/13 or “A Single Sacred Word: Citizen” | The White House

HHS SAYS HEALTH CARE OPTION COMPARISONS BEGIN IN 2014

Ambulances.  Credit:  U.S. Air Force.

FROM: U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health care law allows consumers to easily find and compare options starting in 2014
New rule will expand mental health and substance use disorder benefits to 62 million Americans

Department of Health and Human Services (HHS) Secretary Kathleen Sebelius today announced a final rule that will make purchasing health coverage easier for consumers. The policies outlined today will give consumers a consistent way to compare and enroll in health coverage in the individual and small group markets, while giving states and insurers more flexibility and freedom to implement the Affordable Care Act.

"The Affordable Care Act helps people get the health insurance they need," said Secretary Sebelius. "People all across the country will soon find it easier to compare and enroll in health plans with better coverage, greater quality and new benefits."

Today’s rule outlines health insurance issuer standards for a core package of benefits, called essential health benefits, that health insurance issuers must cover both inside and outside the Health Insurance Marketplace. Through its standards for essential health benefits, the final rule released today also expands coverage of mental health and substance use disorder services, including behavioral health treatment, for millions of Americans.

A new report by HHS, also released today, details how these provisions will expand mental health and substance use disorder benefits and federal parity protections for 62 million more Americans.

In the past, nearly 20 percent of individuals purchasing insurance didn’t have access to mental health services, and nearly one third had no coverage for substance use disorder services. The rule seeks to fix that gap in coverage by expanding coverage of these benefits in three distinct ways:
By including mental health and substance use disorder benefits as Essential Health Benefits
By applying federal parity protections to mental health and substance use disorder benefits in the individual and small group markets
By providing more Americans with access to quality health care that includes coverage for mental health and substance use disorder services
To give states the flexibility to define essential health benefits in a way that would best meet the needs of their residents, this rule also finalizes a benchmark-based approach. This approach allows states to select a benchmark plan from options offered in the market, which are equal in scope to a typical employer plan. Twenty-six states selected a benchmark plan for their state, and the largest small business plan in each state will be the benchmark for the rest.

The rule additionally outlines actuarial value levels in the individual and small group markets, which helps to distinguish health plans offering different levels of coverage. Beginning in 2014, plans that cover essential health benefits must cover a certain percentage of costs, known as actuarial value or "metal levels." These levels are 60 percent for a bronze plan, 70 percent for a silver plan, 80 percent for a gold plan, and 90 percent for a platinum plan. Metal levels will allow consumers to compare insurance plans with similar levels of coverage and cost-sharing based on premiums, provider networks, and other factors. In addition, the health care law limits the annual amount of cost sharing that individuals will pay across all health plans – preventing insured Americans from facing catastrophic costs associated with an illness or injury.

Policies in today’s rule also provide more information on accreditation standards for qualified health plans (QHPs) that will be offered through the Health Insurance Marketplaces (also known as Exchanges), one-stop shops that will provide access to quality, affordable private health insurance choices.

Together, these provisions will help consumers compare and select health plans in the individual and small group markets based on what is important to them and their families. People can make these choices knowing these health plans will cover a core set of critical benefits and can more easily compare the level of coverage based on a uniform standard. Further, these provisions help expand choices and competition on the Marketplaces.

DEPUTY DEFENSE SECRETARY CARTER WARNS OF CHAOS

FROM: U.S. DEPARTMENT OF DEFENSE

Spending Cuts Would Cause Chaos, Carter Says
By Jim Garamone
American Forces Press Service

WASHINGTON, Feb. 21, 2013 - Deep, across-the board spending cuts scheduled to take effect March 1 would cause chaos for the Defense Department, Deputy Defense Secretary Ashton B. Carter said in a televised interview yesterday.

Carter told Judy Woodruff on "PBS Newshour" that the department will do what it can to minimize disruptions should the cuts kick in, but it can do only so much.

"We don't have a lot of flexibility, and we don't have a lot of time in that regard," Carter said.

A "sequestration" mechanism in budget law requires DOD to cut $46 billion in spending from March 1 until the Sept. 30 end of the fiscal year unless Congress comes up with an alternative that would stop sequestration from triggering. This comes on top of $487 billion in defense spending reductions already programmed over 10 years, and Pentagon officials have noted that operating under continuing resolutions in the absence of a fiscal year budget complicates matters.

Defense Secretary Leon E. Panetta notified Congress yesterday that the department is preparing to place almost all of its 800,000 civilian employees on unpaid furlough for one day a week through the rest of the fiscal year. These are not faceless bureaucrats who simply shuffle paper, Carter said.

"They repair our ships. They maintain our aircraft," Carter said. "That's who these people are, and 44 percent of them are veterans. It's a terrible thing to have to deprive them of some of their income."

If sequestration triggers, operations and maintenance -- the primary funding that ensures readiness -- will be particularly affected. The department will ensure units deploying to Afghanistan will receive the training needed to succeed. But this will rob other units readying for other missions, Carter said.

"That's just a mathematical fact of doing sequester," he added. "This is very damaging to national security."

In planning for sequestration, the Navy already has postponed sending an aircraft carrier to the Persian Gulf to join one already there, to ensure there will be enough ready carriers to dispatch to other critical areas if required.

"In everything we do, we're really trying to keep on protecting the country and delivering the defense under these circumstances," Carter said.

Press Briefing | The White House

Press Briefing | The White House

STATE DEPARTMENT OFFICIAL'S COMMENTS ON POSTHARVEST LOSS AND FOOD SECURITY

FROM: U.S. DEPARTMENT OF STATE
Food Security and Minimizing Postharvest Loss
Remarks
Robert D. Hormats
Under Secretary for Economic Growth, Energy, and the Environment
Marshall Center East Auditorium
Washington, DC
February 19, 2013

Thank you for participating in today’s conference on post-harvest losses. In particular, I would like to thank many of you here today. Your work to reduce post-harvest losses and support food security and sustainability throughout the globe is critical. Finding and supporting efforts to stop post-harvest food loss has been a high priority for me since I took this job over three years ago.

Especially because the measures to avoid post-harvest losses are within reach if we and other countries take bold action.

The scale of post-harvest food loss is tragic. Nearly one-third of global agricultural production never makes it to the consumer or arrives in poor condition. Beyond the threat to food security, post-harvest losses adversely affect farmers and consumers in the lowest income groups. And, post-harvest food losses are a waste of valuable farming inputs, such as water, energy, land, labor, and capital. Having lived in East Africa earlier in my life, I saw the magnitude of post-harvest food losses in that region, and the tragic repercussions for human hunger, loss of farmer income, and harm to economic growth.

I have discussed the importance of reducing post-harvest losses in my meetings with leaders in India, Africa, and other parts of the world—and, indeed, at the G-8 and at APEC. Post-harvest losses can be reduced through:
The development and dissemination of regionally-appropriate technologies and techniques, and
Adoption of policies and incentives for investment in post-harvest infrastructure.
Developing New Technologies and Techniques

First, it’s important to develop technologies and techniques to reduce post-harvest losses that are appropriate to the needs of local communities. Needs vary widely, depending on crop type, region, weather, and other variables. There is no one-size-fits-all solution. The U.S. government is taking a comprehensive approach to helping countries solve the problem of post-harvest food loss. This includes, the Obama Administration’s Feed the Future initiative, which promotes a series of programs to reduce post-harvest losses. In Ghana, for example, Feed the Future is improving grain storage through better technology and processing techniques.

And, at the 2012 G8 Summit at Camp David, President Obama, other G8 leaders, and leaders from African partner countries launched the New Alliance for Food Security and Nutrition.

The Alliance emphasizes engaging more partners from the private sector in these efforts and taking bold steps to reduce post-harvest food losses.

Indeed, a number of world-class companies, such as ADM, Cargill, Ingersoll-Rand, and Walmart, have already successfully deployed food storage and preservation technologies in several regions of the world. These companies are making a difference—supporting local farmers by efficiently moving their food products to store shelves with little loss.

In addition, companies such as ADM, NGO and individual donors, and many others are investing in universities and research institutions—such as at the University of Illinois and at the University of California, Davis—to carry out cutting-edge research programs, some of which you will hear more about during today’s program.

Several entrepreneurs have also stepped up to develop new technologies and approaches to reduce food loss. I recently met with Promethean Power Systems—a start-up co-founded by an MIT graduate and a Boston entrepreneur. They have partnered with an Indian company called Icelings to develop a solar-powered refrigeration system for transporting fruits and vegetables from rural farms to city markets. Technologies like this will improve the livelihoods of farmers in India by reliably getting their produce to market and will help consumers by increasing the availability of food. In June 2012, Secretary Clinton awarded the Promethean-Icelings partnership the first ever grant of the U.S.-India Science and Technology Endowment Fund.

There are many examples of new technologies and techniques being developed to reduce post-harvest food loss. These innovative solutions are essential.

Policies and Incentives to Invest in Post-Harvest Loss Mitigation

But even with the right technology solutions, many countries lack meaningful incentives, affordable financing options, and necessary government policies to encourage farmers to adopt efficient practices. Many countries lack the incentives for retailers to invest in equipment, facilities, and stores needed to reduce food loss and broaden market opportunities. And, government policies and regulations in some countries make it difficult for investments to be profitable. That’s why—in addition to developing new technologies and techniques—it is critical that governments adopt policies that encourage greater investment in post-harvest storage and distribution network infrastructures.

Some important progress is being made.

I recently returned from a trip to India, where I met with government officials who have taken steps to open India’s multi-brand retail sector to encourage foreign direct investment. This policy shift was aimed, in part, at building modern food supply chains, developing cold storage infrastructure, and improving overall agricultural efficiency and sustainability in India. Foreign direct investment in the multi-brand retail sector—as well as the development of India’s own storage and distribution industry and post-harvest technologies—are critical for India’s overall economic growth prospects as well as for the success of its agricultural sector.

Indian Prime Minister Manmohan Singh explained that an organized and efficient retail sector "will help to ensure that a third of our fruits and vegetables, which at present are wasted because of storage and transit losses, actually reach the consumer." Prime Minister Singh makes a compelling point—one that was echoed in my meetings with the Global Cold Chain Alliance’s India Division and the Agra Cold Storage Owners Association.

I have heard similar sentiments in other parts of the world. The need for investment in post-harvest infrastructure is clear and present. It’s time to remove bottlenecks and unlock business investment. The Department of State, USAID, and others in the U.S. government are working with foreign governments across the globe to help facilitate and make viable investment in post-harvest infrastructure.

Meeting the food demands of an ever-increasing world population presents a major challenge for the 21st century. Among the most important and efficient ways to improve food security, nutrition, and incomes for millions of small farmers is to make certain that every bushel of wheat, liter of milk, or kilogram of rice that is produced is stored properly and delivered efficiently from farm to table. A great deal of work is being done to improve agricultural productivity in a sustainable way around the world. But, at the same time, we must also work to ensure that goods produced by farmers actually have good markets and reach consumers in good condition. It’s high time to make solving the problem of post-harvest food losses an urgent global priority—and to make such losses a thing of the past.

Success will improve the food security of hundreds of millions of people around the world, boost the incomes of millions of small holder farmers in villages and towns throughout the world’s developing and emerging countries, and represent a giant step forward to better conserve our planet’s natural resources.

Thank you.

Beating birth defects before pregnancy

Beating birth defects before pregnancy