WHITE HOUSE FACT SHEET REGARDING OVERTIME PROTECTIONS

FROM:  THE WHITE HOUSE 
FACT SHEET: Opportunity for All: Rewarding Hard Work by Strengthening Overtime Protections

After weathering the Great Recession and through five years of hard work and determination, America is creating jobs and rebuilding our economy. But as a result of shifts that have taken hold over more than three decades, too many Americans are working harder than ever just to get by, let alone to get ahead.

President Obama believes that, in America, if you work hard and take responsibility, you should have the opportunity to succeed. That’s why he has pledged to make 2014 a year of action, working with Congress where they’re willing, but using his phone and his pen wherever he can to build real, lasting economic security for the middle class and those working hard to become a part of the middle class.

As part of that effort, today, President Obama is directing the Secretary of Labor to begin the process of addressing overtime pay protections to help make sure millions of workers are paid a fair wage for a hard day's work and rules are simplified for employers and workers alike.

Basic Overtime Protections Have Eroded

The overtime rules that establish the 40-hour workweek, a linchpin of the middle class, have eroded over the years.  As a result, millions of salaried workers have been left without the protections of overtime or sometimes even the minimum wage. For example, a convenience store manager or a  fast food shift supervisor or an office worker may be expected to work 50 or 60 hours a week or more, making barely enough to keep a family out of poverty, and not receive a dime of overtime pay. It’s even possible for employers to pay workers less than the minimum wage per hour.

The overtime and minimum wage rules are set in the Fair Labor Standards Act, originally passed by Congress in 1938, and apply broadly to private-sector workers. However, there are some exceptions to these rules, which the Department of Labor has the authority to define through regulation. One of the most commonly used exemptions is for “executive, administrative and professional” employees, the so-called “white collar” exemption.

Workers who are paid hourly wages or who earn below a certain salary are generally protected by overtime regulations, while those above the threshold who perform executive, professional or administrative duties are not.  That threshold has failed to keep up with inflation, only being updated twice in the last 40 years and leaving millions of low-paid, salaried workers without these basic protections. Specifically:

In 1975 the Department of Labor set the threshold below which white collar workers were entitled to overtime pay at $250 per week.
In 2004 that threshold was set at $455 per week (the equivalent of $561 in today's dollars). This is below today’s poverty line for a worker supporting a family of four, and well below 1975 levels in inflation adjusted terms.
Today, only 12 percent of salaried workers fall below the threshold that would guarantee them overtime and minimum wage protections (compared with 18 percent in 2004 and 65 percent in 1975).  Many of the remaining 88 percent of salaried workers are ineligible for these protections because they fall within the white collar exemptions.  Many recognize that these regulations are outdated, which is why states like New York and California have set higher salary thresholds.

At the same time, employers and workers alike have difficulty navigating the existing regulations, and many recognize that the rules should be modernized to better fit today’s economy.

Details of the Presidential Memorandum

Improving the overtime regulations consistent with the Memorandum the President will sign today could benefit millions of people who are working harder but falling further behind. The Fair Labor Standards Act protects over 135 million workers in more than 7.3 million workplaces nationwide.

The Presidential Memorandum instructs the Secretary of Labor to update regulations regarding who qualifies for overtime protection. In so doing, the Secretary shall consider how the regulations could be revised to:

 Update existing protections in keeping with the intention of the Fair Labor Standards Act.
Address the changing nature of the American workplace.
Simplify the overtime rules to make them easier for both workers and businesses to understand and apply.

PRESIDENT OBAMA MAKES REMARKS ON OVERTIME PAY

FROM:  THE WHITE HOUSE
Remarks by the President On Overtime Pay

East Room

2:27 P.M. EDT

THE PRESIDENT:  Thank you, everybody, thank you.  (Applause.)  Thank you so much.  Please.  Thank you, guys.  Please have a seat.

Well, welcome to the White House.  Before I get started, I just want to acknowledge somebody who is working so hard on behalf of America’s workers each and every day, our outstanding Secretary of Labor, Tom Perez.  So give him a big round of applause.  (Applause.)  There you go.  Tom must have brought some of his family with him.  (Laughter.)

We’ve got a lot of honored guests here.  We’ve got middle-class workers who rely on overtime pay.  We’ve got business owners who believe in treating their employees right both because it’s the right thing to do but also because it’s good for business.  And thanks to the hard work and resilience of Americans like the ones who are here today, our economy has been growing for a number of years now.

Our businesses have created more than 8.5 million new jobs over the last four years.  The unemployment rate is at the lowest it’s been in over five years.  But in many ways, the trends that have really battered middle-class families for decades have gotten worse, not better.  Those at the top are doing better than ever, but for the average family, wages have barely budged.  And too many Americans are working harder and harder just to get by.

So we’ve got to reverse those trends.  We’ve got to build an economy that works for everybody, not just for a few.  And we’ve got to restore the basic notion of opportunity that is at the heart of the American experience:  Opportunity for everyone; the belief that here in America, it doesn’t matter where you started, if you are willing to work hard and act responsibly, you’ve got a chance to get ahead.

So at my State of the Union at the beginning of the year I laid out an opportunity agenda to give more Americans a chance to succeed.  It’s got four parts.  Number one, making sure we’re creating more good jobs that pay good wages.  Number two, making sure that we’re training more Americans with the skills that are needed to fill those jobs.  Number three, making sure every child in America gets a world-class education.  And number four, which is what I’m going to be focusing on today, making sure that our economy rewards the hard work of every American.

Now, making work pay means making sure women earn equal pay for equal work.  (Applause.)  It means giving women the chance to have a baby without sacrificing jobs, or a day off to care for a sick child or parent without worrying about making ends meet.  It means making sure every American has access to quality, affordable health care that’s there when you need it.  So if there’s somebody out there that you know that doesn’t have health insurance, make sure they go on healthcare.gov -- (laughter) -- before March 31st.  That’s a priority.  (Applause.)  And it means wages and paychecks that help to support a family.

Profitable corporations like Costco see paying higher wages as way to reduce turnover and boost productivity.  And I’ve asked business owners to do what they can to give their employee a raise.  As some of you saw, I was at The Gap yesterday -- or the day before yesterday in Manhattan -- and fortunately Malia and Sasha liked the sweaters I bought them.  (Laughter.)  But part of what I wanted to highlight was the fact that, on its own, The Gap decided to give a raise to 64,000 employees across the country.

I’ve now called on Congress to give America a raise by raising the minimum wage to $10.10 an hour.  (Applause.)  And in this year of action, while Congress decides what it’s going to do -- whether it’s going to do anything about this issue -- and I hope that it does, and I know Democrats are pushing hard to get minimum wage legislation passed -- I’m going to do what I can on my own to raise wages for more hardworking Americans.  So a few weeks ago I signed an executive order requiring federal contractors to pay their employees a fair wage of at least $10.10 an hour.  Today, I’m going to use my pen to give more Americans the chance to earn the overtime pay that they deserve.

Overtime is a pretty simple idea:  If you have to work more, you should get paid more.  And if you want to know why it’s so important, just ask some of the folks here who are behind me.  Nancy Minor works at an oil refinery in Pennsylvania -- Nancy, raise your hand.  There you go.  Yes, give Nancy a big round of applause.  (Applause.)  So for the last 16 years, Nancy has been a single mom raising and educating four kids on her own, and that is not easy, as you might imagine.  She’s been able to do it, though, thanks in part to her overtime pay.

For more than 75 years, the 40-hour workweek and the overtime that comes with it have helped countless workers like Nancy get ahead.  And it means that when she’s asked to makes significant sacrifices on behalf of her company -- which she’s happy to do -- they’re also looking out for her, recognizing that that puts a strain on her family and -- having to get a babysitter and all kinds of things, adjustments that she has to make.  It’s just fair.  It’s just the right thing to do.

Unfortunately, today, millions of Americans aren’t getting the extra pay they deserve.  That’s because an exception that was originally meant for high-paid, white-collar employees now covers workers earning as little as $23,660 a year.  So if you’re making $23,000, typically, you’re not high in management.  If your salary is even a dollar above the current threshold, you may not be guaranteed overtime.  It doesn't matter if what you do is mostly physical work like stocking shelves, it doesn't matter if you’re working 50 or 60 or 70 hours a week -- your employer doesn't have to pay you a single extra dime.

And I think that’s wrong.  It doesn’t make sense that in some cases this rule actually makes it possible for salaried workers to be paid less than the minimum wage.  It’s not right when business owners who treat their employees fairly can be undercut by competitors who aren’t treating their employees right.  If you’re working hard, you’re barely making ends meet, you should be paid overtime.  Period.  Because working Americans have struggled through stagnant wages for too long.

Every day, I get letters from folks who just feel like they’re treading water.  No matter how hard they’re working -- they’re putting in long hours, they’re working harder and harder just to get by, but it’s always, at the end of the month, real tight.  Workers like the ones with me here today, they want to work hard.  They don’t expect a free lunch and they don’t expect to be fabulously wealthy, they just want a chance to get ahead.

So today, I’m taking action to help give more workers that chance.  I’m directing Tom Perez, my Secretary of Labor, to restore the common-sense principle behind overtime:  If you go above and beyond to help your employer and your economy succeed, then you should share a little bit in that success.  And this is going to make a real difference in the lives of millions of Americans, from managers in fast food and retail to office workers, cargo inspectors.  

And we’re going to do this the right way -- we’re going to consult with both workers and businesses as we update our overtime rules.  We’re going to work to simplify the system to it’s easier for employers and employees alike.  With any kind of change like this, not everybody is going to be happy, but Americans have spent too long working more and getting less in return.

So wherever and whenever I can make sure that our economy rewards hard work and responsibility, that it makes sure that it’s treating fairly the workers who are out there building this economy every day, that’s what I’m going to do.  What every American wants is a paycheck that lets them support their families, experience a little bit of economic security, pass down some hope and optimism to their kids.  That’s what we’re going to be fighting for.  That’s what I’m going to be fighting for as long as I’m President of the United States.

And with that, I’m going to sign this memo.  And I want to thank everybody for being here, especially the folks standing behind me.  (Applause.)

END
2:27 P.M. EDT

MAN SENTENCED FOR CYBER "SEXTORTION"

FROM:  U.S. JUSTICE DEPARTMENT 
Thursday, March 13, 2014
Maine Resident Sentenced for Engaging in Cyber “Sextortion” of New Hampshire Victim

John Bryan Villegas, 23, of Kittery, Maine, was sentenced today in federal court in New Hampshire to serve 33 months in prison for engaging in a type of cyber stalking known as “sextortion,” announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney John P. Kacavas of the District of New Hampshire.

On Sept. 18, 2013, Villegas pleaded guilty to an information charging him with one count of engaging in cyber stalking.   The information charges that Villegas attempted to extort a New Hampshire female into providing him with sexually explicit photographs and videos of her.   He sent her e-mail messages in which he threatened to publish on the internet – and distribute to the victim’s neighbors and work and social acquaintances – other sexually explicit photographs of the victim that were stored on her laptop computer, which had been recently stolen during a burglary of her residence.   On Jan. 9, 2014, Villegas pleaded guilty in New Hampshire state court to charges that he committed that burglary.

The case was investigated by the U.S. Secret Service and was prosecuted by Senior Trial Attorney Mona Sedky of the Computer Crime and Intellectual Property Section in the Justice Department’s Criminal Division and Assistant U.S. Attorney Arnold H. Huftalen of the District of New Hampshire.

The department would like to thank the Dover, N.H., and Kittery, Maine, police departments and the Naval Criminal Investigative Service for their cooperation.

U.S. EXTENDS CONGRATULATIONS TO POPE FRANCIS ON ELECTION ANNIVERSARY

FROM:  U.S. STATE DEPARTMENT 
On the Anniversary of the Election of His Holiness Pope Francis
Press Statement
John Kerry
Secretary of State
Washington, DC
March 13, 2014

On behalf of President Obama and the people of the United States, I extend heartfelt congratulations to His Holiness Pope Francis on the one-year anniversary of his historic election to the See of Rome.

I had the privilege two months ago to be the first Catholic Secretary of State to visit the Vatican since the United States established diplomatic relations with the Holy See three decades ago. As a former altar boy, I never imagined that I would one day cross the threshold of the Vatican as Secretary of State.

My first and formative sense of religion came from my parents, Richard and Rosemary. My parents taught me early that we are all put on this earth for something greater than ourselves. They taught me my faith and they taught me to live by it.

Millions of Americans share this devotion to a higher purpose and a commitment to help others. The relationship between the United States and the Holy See is built on that common foundation. The Holy Father’s emphasis on addressing poverty has brought much needed global attention to helping the neediest among us.

The values that unite us are many and include promoting human rights and religious freedom, protecting the environment, and fighting trafficking in persons and the exploitation of faith as a pretext for violence.

I am particularly appreciative of the Holy Father’s appeals for peace in the Middle East and support of Israeli–Palestinian negotiations.

Today, I join millions of Americans in offering congratulations to the Holy Father as he continues his work of leading the Catholic Church in our modern world.

SEC CHARGES LIONS GATE WITH GIVING INACCURATE DISCLOSURES TO STOP TAKEOVER

FROM:  U.S. SECURITIES AND EXCHANGE COMMISSION 
The Securities and Exchange Commission today charged motion picture company Lions Gate Entertainment Corp. with failing to fully and accurately disclose to investors a key aspect of its effort to thwart a hostile takeover bid.

Lions Gate agreed to pay $7.5 million and admit wrongdoing to settle the SEC’s charges.

According to the SEC’s order instituting settled administrative proceedings, Lions Gate’s management participated in a set of extraordinary corporate transactions in 2010 that put millions of newly issued company shares in the hands of a management-friendly director.  A purpose of the maneuver was to defeat a hostile tender offer by a large shareholder who had been locked in a battle for control of the company for at least a year.  However, Lions Gate failed to reveal that the move was part of a defensive strategy to solidify incumbent management’s control, instead stating in SEC filings that the transactions were part of a previously announced plan to reduce debt.  In fact, the company had made no such prior announcement.  Lions Gate also represented that the transactions were not “prearranged” with the management-friendly director, and failed to disclose the extent to which it planned and enabled the transactions with the expectation that the director would get the shares.

“Lions Gate withheld material information just as its shareholders were faced with a critical decision about the future of the company,” said Andrew J. Ceresney, director of the SEC’s Division of Enforcement.  “Full and fair disclosure is crucial in tender offers given that  shareholders rely heavily on corporate insiders to make informed decisions, especially in the midst of tender offer battles.”

According to the SEC’s order, the large shareholder had made several tender offers and acquired more than 37 percent of Lions Gate’s outstanding stock.  For its part, Lions Gate management believed that allowing the shareholder to control the company was not in the best interest of Lions Gate or its shareholders.  The company engaged in an active campaign to discourage shareholders from tendering their stock to the shareholder, and vigorously looked for a management ally to purchase available shares of Lions Gate stock.  Lions Gate went on to establish the basic framework for an extraordinary three-part set of transactions that would begin by exchanging $100 million in notes from a holder for new notes convertible to stock at a more favorable conversion rate.  The note holder would then sell the notes to the management-friendly director at a premium, and the director would then immediately convert the notes to shares.

According to the SEC’s order, the Lions Gate board of directors approved the transactions at a midnight board meeting on July 20, 2010, while facing an imminent tender offer from the large shareholder.  Completed in hours, these transactions allowed the friendly director to obtain control of approximately nine percent of the company’s outstanding stock, effectively blocking the takeover bid.

The SEC’s order finds that Lions Gate then failed to meet its disclosure obligations.  First, Lions Gate stated in a July 20 press release and 8-K filing that the transactions were done to reduce the company’s debt, and failed to disclose the effort to foil the takeover bid.  Furthermore, Lions Gate management knew that a large, direct sale of stock from the company to the friendly director would have required prior approval from its shareholders under a New York Stock Exchange (NYSE) rule.  After the transactions, NYSE contacted Lions Gate to inquire whether the transactions violated the NYSE rule requiring shareholder approval.  In response to the NYSE inquiry, Lions Gate said it would disclose additional information.  In its subsequent tender offer filings made to the SEC in September, Lions Gate represented that the note exchange was not part of a prearranged plan to get shares to the management-friendly director.

Among the facts admitted by Lions Gate, reflecting the extent to which the company planned and enabled the transactions, include:

Lions Gate did not announce a plan to reduce total debt prior to issuing the press release on July 20, 2010.
Lions Gate amended its insider trading policy at the midnight board meeting to allow the friendly director to immediately convert the notes to stock.
Lions Gate approved the friendly director’s last-minute request to change the conversion price.
Lions Gate allowed the friendly director to review the new note terms, term sheet, and exchange agreement before they were provided to the note holder.
Lions Gate failed to include other required information in its tender offer filings, including the fact that the friendly director converted the notes at favorable price resulting in the director owning a near 9 percent interest in Lions Gate.
The SEC’s order finds that Lions Gate violated Sections 13(a) and 14(d) of the Securities Exchange Act of 1934 and Rules 12b-20 13a-11, and 14d-9.  In addition to the financial penalty, the order requires Lions Gate to cease and desist from future violations.

The SEC’s investigation was conducted by Nicholas A. Brady with assistance from Jeffrey T. Infelise.  The case was supervised by Anita B. Bandy and Moira T. Roberts.

CARGO UNLOADED FROM SOYUZ TMA-10M SPACECRAFT

FROM: NASA 
Engineers document cargo as it is unloaded from the Soyuz TMA-10M spacecraft after it landed with Expedition 38 Commander Oleg Kotov of the Russian Federal Space Agency, Roscosmos, and Flight Engineers: Mike Hopkins of NASA, and, Sergey Ryazanskiy of Roscosmos, near the town of Zhezkazgan, Kazakhstan on Tuesday, March 11, 2014. Hopkins, Kotov and Ryazanskiy returned to Earth after five and a half months onboard the International Space Station where they served as members of the Expedition 37 and 38 crews. Image Credit-NASA-Bill Ingalls.

WHITE HOUSE PRESS SECRETARY'S STATEMENT ON VISIT BY IRISH PRIME MINISTER KENNY

FROM:  THE WHITE HOUSE
Statement by the Press Secretary on the Visit of Irish Prime Minister Enda Kenny

President Obama will welcome Prime Minister (Taoiseach) Enda Kenny of Ireland to the White House on Friday, March 14.  The United States and Ireland share a strong bilateral relationship; deep cultural, historic, and people-to-people bonds; and a shared commitment to advancing peace, security, and prosperity in the world.  In the morning, the Vice President will host the Taoiseach for breakfast at the Naval Observatory, and the President will meet with the Taoiseach in the Oval Office.  Subsequently, the President and the Vice President will attend the traditional St. Patrick’s Day lunch at the U.S. Capitol.  In the early evening, the President and the First Lady will host a reception to celebrate their sixth St. Patrick’s Day at the White House.  During the reception, the President and Kenny will participate in the annual Shamrock ceremony started under President Truman.

Also on March 14, the Vice President will meet with First Minister Peter Robinson and deputy First Minister Martin McGuinness of Northern Ireland at the White House to discuss progress toward building a peaceful and prosperous future for the people of Northern Ireland.

REMARKS: PRESIDENT OBAMA AND UKRAINE PRIME MINISTER YATSENYUK

FROM:  THE WHITE HOUSE 

Remarks by President Obama and Ukraine Prime Minister Yatsenyuk after Bilateral Meeting

Oval Office

3:30 P.M. EDT

PRESIDENT OBAMA:  It is a pleasure to welcome Prime Minister Yatsenyuk to the Oval Office, to the White House. 

I think all of us have seen the courage of the Ukrainian people in standing up on behalf of democracy and on the desire that I believe is universal for people to be able to determine their own destiny.  And we saw in the Maidan how ordinary people from all parts of the country had said that we want a change.  And the Prime Minister was part of that process, showed tremendous courage, and upheld the principles of nonviolence throughout the course of events over the last several months.

Obviously, the Prime Minister comes here during a very difficult time for his country.  In the aftermath of President Yanukovych leaving the country, the parliament, the Rada, acted in a responsible fashion to fill the void, created a inclusive process in which all parties had input, including the party of former President Yanukovych.  They have set forward a process to stabilize the country, take a very deliberate step to assure economic stability and negotiate with the International Monetary Fund, and to schedule early elections so that the Ukrainian people, in fact, can choose their direction for the future.  And the Prime Minister has managed that process with great skill and great restraint, and we’re very much appreciative of the work that he has done. 

The most pressing challenge that Ukraine faces at the moment, however, is the threat to its territorial integrity and its sovereignty.  We have been very clear that we consider the Russian incursion into Crimea outside of its bases to be a violation of international law, of international agreements of which Russia is a signatory, and a violation of the territorial integrity and sovereignty of Ukraine.  And we have been very firm in saying that we will stand with Ukraine and the Ukrainian people in ensuring that that territorial integrity and sovereignty is maintained. 

I think we all recognize that there are historic ties between Russia and Ukraine, and I think the Prime Minister would be the first one to acknowledge that.  And I think the Prime Minister and the current government in Kyiv has recognized and has communicated directly to the Russian Federation their desire to try to manage through this process diplomatically.  But what the Prime Minister I think has rightly insisted on is, is that they cannot have a country outside of Ukraine dictate to them how they should arrange their affairs.  And there is a constitutional process in place and a set of elections that they can move forward on that, in fact, could lead to different arrangements over time with the Crimean region, but that is not something that can be done with the barrel of a gun pointed at you.

And so Secretary Kerry is in communications with the Russian government and has offered to try to explore with his counterpart, Foreign Minister Lavrov, a diplomatic solution to this crisis.  We are in close communication with the Ukrainian government in terms of how we might proceed going forward.  But we will continue to say to the Russian government that if it continues on the path that it is on then not only us, but the international community -- the European Union and others -- will be forced to apply a cost to Russia’s violations of international law and its encroachments on Ukraine. 

There’s another path available, and we hope that President Putin is willing to seize that path.  But if he does not, I’m very confident that the international community will stand strongly behind the Ukrainian government in preserving its unity and its territorial integrity.

Let me just make two final points.  Obviously, because of the political turmoil, the economic situation in Ukraine has become more challenging, not less.  And that’s why I’m very proud that not only as critical members of the International Monetary Fund, the IMF, we are working with the Prime Minister and his team in a package that can help to institute necessary reforms inside of the Ukraine, but also help to stabilize the situation so that people feel confident that in their daily lives they can meet their basic necessities.

We’re also asking Congress to act promptly to deliver on an aid package, including a $1 billion loan guarantee that can help smooth the path for reform inside of Ukraine and give the Prime Minister and his government the capacity to do what they need to do as they are also organizing an election process.  So I would just ask both Democrats and Republicans, who I know are unified in their support of Ukraine, to move quickly to give us the support that we need so that we can give the Ukrainian people the support that they need.

And then, finally, Mr. Prime Minister, I would ask that you deliver a message on behalf of the American people to all the Ukrainian people, and that is that we admire their courage; we appreciate their aspirations.  The interests of the United States are solely in making sure that the people of Ukraine are able to determine their own destiny.  That is something that here in the United States we believe in deeply.  I know it’s something that you believe in deeply as well.  And you can rest assured that you will have our strong support as you move forward during these difficult times. 

Thank you.

PRIME MINISTER YATSENYUK:  Thank you, Mr. President.  And we highly appreciate the support that you have given to the Ukrainian people.  And my country feels that the United States stands by the Ukrainian people. 

Mr. President, it’s all about the freedom.  We fight for our freedom.  We fight for our independence.  We fight for our sovereignty.  And we will never surrender. 

My country has faced a number of challenges.  The military one is a key challenge today, and we urge Russia to stick to its international obligations, to pull back its military into barracks, and to start the dialogue with no guns, with no military, with no tanks, but with the diplomacy and political tools.

On behalf of my government, I would like to reiterate that we are absolutely ready and open for talks with the Russian Federation.  We adhere to all international obligations.  And we as the state of Ukraine will fulfill all bilateral and multilateral international treaties. 

On the economic side, Mr. President, we highly appreciate the support of the United States and the decision to guarantee $1 billion loan for the Ukrainian economy.  You know that we resumed talks with the IMF.  We do understand that these are tough reforms, but these reforms are needed for the Ukrainian state.  And we are back on track in terms of delivering real reforms in my country. 

As I already informed you, probably in the nearest future, next week or in 10 days, Ukraine is to sign a political part of  -- association agreement with the European Union, and we want to be very clear that Ukraine is and will be a part of the Western world, and our Russian partners have to realize that we are ready to make a new type or to craft a new type of our relationship where Ukraine is a part of the European Union, but Ukraine is a good friend and partner of Russia.

So much will depend on whether Russia wants to have this talk and whether Russia wants to have Ukraine as a partner or as a subordinate.  As I already indicated, we will never surrender and we will do everything in order to preserve peace, stability, and independence of my country.  And we appreciate your personal support, the support of your government, support of the American people to the Ukrainian people. 

Thank you, Mr. President.

PRESIDENT OBAMA:  Mr. Prime Minister, thank you very much.

Q    (Inaudible.)

PRESIDENT OBAMA:  Julie, we completely reject a referendum patched together in a few weeks with Russian military personnel basically taking over Crimea.  We reject its legitimacy.  It is contrary to international law.  It is contrary to the Ukrainian constitution. 

I know that we've heard from the Russian Federation this notion that these kinds of decisions are often made in other places, and they’ve even analogized it to Scotland or other situations of that sort.  In each of those cases that they’ve cited, decisions were made by a national government through a long, lengthy, deliberative process.  It's not something that happens in a few days, and it's not something that happens with an outside army essentially taking over the region.

As you just heard the Prime Minister indicate, the people of Ukraine recognize historic ties with the people of Russia.  The Prime Minister you just heard say, repeat what he said often, which is they’re prepared to respect all international treaties and obligations that they are signatories to, including Russian basing rights in Crimea.  The issue now is whether or not Russia is able to militarily dominate a region of somebody else’s country, engineer a slapdash referendum, and ignore not only the Ukrainian constitution but a Ukrainian government that includes parties that are historically in opposition with each other -- including, by the way, the party of the previous President.

So we will not recognize, certainly, any referendum that goes forward.  My hope is, is that as a consequence of diplomatic efforts over the next several days that there will be a rethinking of the process that's been put forward. 

We have already put in place the architecture for us to apply financial and economic consequences to actions that are taken.  But our strong preference is to resolve this diplomatically.  And as you heard the Prime Minister say, this idea that somehow the Ukrainian people are forced to choose between good relations with the West or good relations with Russia, economic ties with the West or economic ties with Russia, is the kind of zero-sum formulation that in the 21st century, with a highly integrated, global economy, doesn’t make any sense and is not in the interests of the Ukrainian people. 

I actually think, in the end, it's not in the interests of Russia either.  Russia should be thinking about how can it work with Ukraine to further strengthen its economic ties and trade and exchanges with Europe.  That will make Russia stronger, not weaker.  But obviously Mr. Putin has some different ideas at this point. 

We do not know yet what our diplomatic efforts will yield, but we'll keep on pressing.  In the meantime, the main message I want to send is that we are highly supportive of a government in Kyiv that is taking on some very tough decisions, is committed to law and order, inclusivity, committed to the rights of all Ukrainian people, and is committed to fair and free elections that should settle once and for all any questions that there may be about what’s transpired since former President Yanukovych left the country. 

And the most important thing to remember is this is up to the Ukrainian people.  It's not up to the United States.  It's not up to Russia.  It's up to the Ukrainian people to make a decision about how they want to live their lives.  That's what all of us should support.  And certainly that's the reason why I'm so pleased to have the Prime Minister here today. 

                     END            3:46 P.M. EDT       

PRESIDENT OBAMA'S MESSAGE TO CONGRESS ON CONTINUATION OF NATIONAL EMERGENCY REGARDING IRAN

FROM:  THE WHITE HOUSE 
Message to the Congress -- Continuation of the National Emergency with Respect to Iran

TO THE CONGRESS OF THE UNITED STATES:

Section 202(d) of the National Emergencies Act (50 U.S.C. 1622(d)) provides for the automatic termination of a national emergency unless, within 90 days prior to the anniversary date of its declaration, the President publishes in the Federal Register and transmits to the Congress a notice stating that the emergency is to continue in effect beyond the anniversary date. In accordance with this provision, I have sent to the Federal Register for publication the enclosed notice stating that the national emergency with respect to Iran that was declared on March 15, 1995, is to continue in effect beyond March 15, 2014.

The crisis between the United States and Iran resulting from the actions and policies of the Government of Iran has not been resolved. The Joint Plan of Action (JPOA) between the P5+1 and Iran went into effect on January 20, 2014, for a period of 6 months. This marks the first time in a decade that Iran has agreed to and taken specific actions to halt its nuclear program and to roll it back in key respects. In return for Iran's actions on its nuclear program, the P5+1, in coordination with the European Union, are taking actions to implement the limited, temporary, and reversible sanctions relief outlined in the JPOA.

Nevertheless, certain actions and policies of the Government of Iran are contrary to the interests of the United States in the region and continue to pose an unusual and extraordinary threat to the national security, foreign policy, and economy of the United States. For these reasons, I have determined that it is necessary to continue the national emergency declared with respect to Iran and to maintain in force comprehensive sanctions against Iran to deal with this threat.

BARACK OBAMA

WHITE HOUSE RELEASES STATEMENT OF G-7 LEADERS ON UKRAINE

FROM:  THE WHITE HOUSE 
Statement of G-7 Leaders on Ukraine

We, the leaders of Canada, France, Germany, Italy, Japan, the United Kingdom, the United States, the President of the European Council and the President of the European Commission, call on the Russian Federation to cease all efforts to change the status of Crimea contrary to Ukrainian law and in violation of international law.  We call on the Russian Federation to immediately halt actions supporting a referendum on the territory of Crimea regarding its status, in direct violation of the Constitution of Ukraine.

Any such referendum would have no legal effect.  Given the lack of adequate preparation and the intimidating presence of Russian troops, it would also be a deeply flawed process which would have no moral force.  For all these reasons, we would not recognize the outcome.

Russian annexation of Crimea would be a clear violation of the United Nations Charter; Russia’s commitments under the Helsinki Final Act; its obligations to Ukraine under its 1997 Treaty of Friendship, Cooperation and Partnership; the Russia-Ukraine 1997 basing agreement; and its commitments in the Budapest Memorandum of 1994.  In addition to its impact on the unity, sovereignty and territorial integrity of Ukraine, the annexation of Crimea could have grave implications for the legal order that protects the unity and sovereignty of all states.  Should the Russian Federation take such a step, we will take further action, individually and collectively.

We call on the Russian Federation to de-escalate the conflict in Crimea and other parts of Ukraine immediately, withdraw its forces back to their pre-crisis numbers and garrisons, begin direct discussions with the Government of Ukraine, and avail itself of international mediation and observation offers to address any legitimate concerns it may have.  We, the leaders of the G-7, urge Russia to join us in working together through diplomatic processes to resolve the current crisis and support progress for a sovereign independent, inclusive and united Ukraine.  We also remind the Russian Federation of our decision to suspend participation in any activities related to preparation of a G-8 Sochi meeting  until it changes course and the environment comes back to where the G-8 is able to have a meaningful discussion.

SWISS BANKER PLEADS GUILTY TO CONSPIRACY IN U.S. TAX EVADER CASE

FROM:  U.S. JUSTICE DEPARTMENT 
Wednesday, March 12, 2014
Swiss Banker Pleads Guilty to Conspiring with U.S. Tax Evaders, Other Swiss Bankers and Bank Management
Defendant Helped U.S. Customers Conceal Assets in Secret Swiss Bank Accounts and Tax Havens

Andreas Bachmann, 56, of Switzerland, pleaded guilty today to conspiring to defraud the Internal Revenue Service (IRS) in connection with his work as a banking and investment adviser for U.S. customers.

Deputy Attorney General James Cole, Assistant Attorney General for the Justice Department’s Tax Division Kathryn Keneally, Acting U.S. Attorney Dana J. Boente for the Eastern District of Virginia and IRS-Criminal Investigation Chief Richard Weber made the announcement after the plea was accepted by U.S. District Judge Gerald Bruce Lee.

“Today’s plea is just the latest step in our wide-ranging investigations into Swiss banking activities and demonstrates the Department of Justice's commitment to global enforcement against those that facilitate offshore tax evasion,” said Deputy Attorney General Cole.  “We fully expect additional developments over the course of the coming months.”

Bachmann was charged in a one-count superseding indictment on July 21, 2011, and faces a maximum penalty of five years in prison when he is sentenced on Aug. 8, 2014.

In a statement of facts filed with the plea agreement, Bachmann admitted that between 1994 and 2006, while working as a relationship manager in Switzerland for a subsidiary of an international bank, he engaged in a wide-ranging conspiracy to aid and assist U.S. customers in evading their income taxes by concealing assets and income in secret Swiss bank accounts.

As part of that conspiracy, Bachmann traveled to the United States twice each year to provide banking services and investment advice to his U.S. customers.  As a matter of practice, prior to traveling to the United States, Bachmann notified his executive management, including the head of the subsidiary’s private bank in Zurich and the chief executive officer of the subsidiary, of the planned trip and its objectives.

Although Bachmann had been informed of limitations under U.S. law on his ability to provide investment advice to U.S. account holders regarding U.S. securities, the highest ranking executive at the subsidiary was aware that Bachmann was violating U.S. law.  According to the statement of facts, Bachmann was effectively told by the chief executive officer for the subsidiary, “Mr. Bachmann, you know what we expect of you, don’t get caught.”

According to the statement of facts, Bachmann also engaged in cash transactions while traveling in the United States.  In the course of arranging meetings with U.S. customers, some clients would request that Bachmann either provide them with cash as withdrawals from their undeclared accounts or take cash from them as a deposit to their undeclared accounts.  As part of that process, Bachmann agreed to receive cash from U.S. customers and used that cash to pay withdrawals to other U.S. clients.  In one instance, Bachmann received $50,000 in cash from one U.S. customer in New York City and intended to deliver the money to another U.S. client in Southern Florida.  Airport officials in New York discovered the cash but let Bachmann keep the money after questioning him.  The client in Florida refused to take the money after the client learned about the questioning by New York airport officials, and Bachmann returned to Switzerland with the $50,000 in cash in his checked baggage.  Bachmann advised the executive management of the subsidiary about the incident with the cash.

Bachmann also understood that a number of his U.S. customers concealed their ownership and control of foreign financial accounts by holding those accounts in the names of nominee tax haven entities, or structures, which were frequently created in the form of foreign partnerships, trusts, corporations or foundations.

Bachmann dealt with Josef Dӧrig, a co-defendant, regarding the formation and/or maintenance of structures for U.S. customers, among others.  In approximately 1997, the international bank instructed Dӧrig to form his own company specializing in the formation and management of nominee tax haven entities because it was “too risky” to have Dörig perform that work from inside the international bank.  The international bank then directed the subsidiary and others to use Dӧrig and his Swiss trust company, Dӧrig Partner AG, as the preferred choice for the formation and management of structures.

This case is being investigated by IRS-Criminal Investigation.  Assistant U.S. Attorney Mark D. Lytle and Tax Division Trial Attorneys Mark F. Daly, Nanette L. Davis and Jason Poole are prosecuting the case.

U.S. DEFENSE DEPARTMENT CONTRACTS FOR MARCH 12, 2014

FROM:  U.S. DEFENSE DEPARTMENT 
CONTRACTS
NAVY

General Dynamics National Steel and Shipbuilding Co., San Diego, Calif., is being awarded a $128,500,000 modification to previously awarded contract (N00024-09-C-2229) to accomplish the detail design and construction of the Mobile Landing Platform (MLP) 3 Afloat Forward Staging Base (AFSB).  This modification will provide the detail, design and construction efforts to convert the MLP 3 to an AFSB variant.  Work will be performed in San Diego, Calif., and is expected to be completed by October 2015.  Fiscal 2012, 2013 and 2014 national defense sealift funds in the amount of $95,093,500 will be obligated at time of award.  Contract funds will not expire at the end of the current fiscal year.  The Naval Sea Systems Command, Washington, D.C., is the contracting activity.

Interstate Electronics Corp., Anaheim, Calif., is being awarded an $8,911,790 modification under previously awarded cost-plus-fixed-fee, cost-plus-incentive-fee contract (N00030-14-C-0006) to exercise option line items for a new technology refresh of the C-Band Pulse Doppler Radar (RADAR-C) Transmitter and replacement of the Navy Mobile Instrumentation Ship Communication System in support of Trident II flight tests.  These option line items provide for, but are not limited to, engineering services (system engineering, design and development), system testing, verification and validation, logistics and full system documentation in order to achieve Flight Test Instrumentation Steady State for Strategic Systems Programs flight test mission support.  The maximum dollar value of the option line items is $8,911,790.  Work will be performed in Anaheim, Calif. (80 percent); Cape Canaveral, Fla. (18 percent); and San Jose, Calif. (2 percent), and work is expected to be completed March 15, 2016.  Fiscal 2014 other procurement, Navy contract funds in the amount of $8,911,790 will be obligated at the time of award and will not expire at the end of the current fiscal year.  This contract was a sole source acquisition pursuant to 10 U.S.C. 2304(c)(1).  The Department of the Navy, Strategic Systems Programs, Washington, D.C., is the contracting activity.

ARMY

Northrop Grumman Technical Service Inc., Herdon, Va., was awarded a $30,793,383 modification (P00010) to contract W9124B-13-C-0005 for continued logistic support services.  Fiscal 2014 operations and maintenance, Army funds in the amount of $30,793,383 were obligated at the time of the award.  Estimated completion date is Jan. 31, 2015.  Work will be performed at Fort Irwin, Calif.  Army Contracting Command, Fort Irwin, Calif., is the contracting activity.

DRS Technical Services Inc, Herndon, Va., was awarded a $30,271,266 hybrid firm-fixed price, cost-plus fixed-fee and cost reimbursable multi-year contract to operate control and maintain satellite communications between the continental United States and worldwide locations.  It will also provide help desk and field operations support.  Fiscal 2014 operations and maintenance, Army funds in the amount of $30,271,266 were obligated at the time of the award.  Estimated completion date is March 11, 2017.  Bids were solicited via the Internet with four received. Work will be performed in Rock Island, Ill., Afghanistan, Kuwait, and Germany.  Army Contracting Command, Rock Island, Ill., is the contracting activity (W52P1J-14-C-0026).

DEFENSE LOGISTICS AGENCY

API LLC**, Camuy, Puerto Rico, has been awarded a maximum $11,716,450 modification (P00102) exercising the first option period on a one-year base contract (SPM1C1-13-D-1037) with four one-year option periods for permethrin Army combat uniform coats.  This is a firm-fixed-price contract.  Location of performance is Puerto Rico with a March 18, 2015 performance completion date.  Using military service is Army.  Type of appropriation is fiscal 2014 through fiscal 2015 defense working capital funds.  The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pa.

MISSILE DEFENSE AGENCY

Northrop Grumman Space and Missions Systems, Colorado Springs, Colo. is being awarded A $750,000,000 in-scope contract modification (P00023) to previously awarded indefinite-delivery/indefinite-quantity contract to increase the estimated contract maximum from $2,500,000,000 to $3,250,000,000.  The contract remains a ten (10) year contract with an ordering period from Nov. 21, 2005 through Nov. 21, 2015.  The contract is a hybrid omnibus contract performing predominantly research, development, test and evaluation services for the development of the Ballistic Missile Defense System’s Command, Control, Battle Management, and Communications; the support infrastructure including all information technology; facilities; ground and flight test; warfighter wargames and exercises; modeling and simulation; several operational cells including the Ballistic Missile Defense Network Operations and Security Center, the Joint Functional Command Component for Integrated Missile Defense, and the 100th Missile Defense Brigade. Places of performance under the contract are worldwide but mainly support the Missile Defense Integration and Operations Center, Colorado Springs, Colo. Also supported are the Missile Defense Agency sites in Huntsville, Ala., the National Capital Region, and Dahlgren, Va.  No task order is being issued as a result of this award. No funds are being obligated as all funding takes place at the task order level. The Missile Defense Agency, Colorado Springs, Colo. is the contracting activity (#H95001-10-D-0001).

*Small Business
**Small Disadvantaged Business

NATO COMMANDER GEN. DUNFORD BRIEFS SENATE ON PROGRESS IN AFGHANISTAN

FROM:  U.S. DEFENSE DEPARTMENT 
Dunford Briefs Senate on Progress in Afghanistan
By Jim Garamone
American Forces Press Service

WASHINGTON, March 12, 2014 – By any measure, the U.S. and NATO campaign in Afghanistan has been successful, but that success will be jeopardized if international troops must withdraw at the end of the year, said the commander of the NATO-led International Security Assistance Force and of U.S. forces in Afghanistan said here today.

Marine Corps Gen. Joseph F. Dunford Jr. told the Senate Armed Services Committee today that operations in Afghanistan have been successful in preventing al-Qaida and other terror groups from using the nation as a haven and staging ground.

But this progress is fragile, he added, and Afghanistan will need international trainers and some counterterrorism help to maintain progress.

American and international forces have helped Afghanistan develop security forces that have taken the lead throughout the country. Afghan forces did well against a determined enemy in the 2013 fighting season and stand poised to run a safe and secure election next month, the general said.

ISAF has transitioned from a combat role to a support role, Dunford said, and the 33,600 international troops from 49 countries in Afghanistan have focused on a “train, advise and assist” mission. “Currently,” he added, “ISAF advisors are re-orienting their focus away from developing combat skills to now developing the capabilities and institutions needed for the [Afghan national security forces’] long-term sustainability.”

With none months left in the ISAF campaign, NATO and partner forces will focus on supporting Afghan forces as they prepare for the fighting season, political transition, and security transition in December, when they will assume full responsibility for Afghanistan’s security, Dunford told the senators.

Planners also will continue to posture the force in preparation for NATO’s post-2014 train, advise and assist mission, dubbed Operation Resolute Support, which will address gaps in capabilities that are necessary for the Afghan forces to become self-sustainable.

The security forces still have problems, Dunford said. In 2013, Afghan forces relied on NATO forces for enablers, particularly in close air support, casualty evacuation, logistics, and countering roadside bombs, as well as in intelligence, surveillance, and reconnaissance, the general said. “The [Afghan forces] also suffered high casualties and instances of poor leadership, but impressively remained a cohesive and resilient fighting force,” he added.

The security forces had a very high-profile success when they secured the Loya Jirga -- a national council of community elders and leaders -- in November. The council brought 3,000 Afghan leaders to the national capital of Kabul to discuss the U.S.-Afghanistan bilateral security agreement. Terror networks and the Taliban had vowed to disrupt the meeting, but they were unsuccessful.

“On balance, after watching the [Afghan forces] respond to a variety of challenges over the past year, I do not believe the Taliban-led insurgency represents an existential threat to [the Afghan government or Afghan security forces],” Dunford said.

But NATO and partner nations must remain for Operation Resolute Support, the general said. Afghan President Hamid Karzai has refused to sign the agreement, and President Barack Obama has directed the U.S. military to develop plans for a full withdrawal from Afghanistan by the end of the year in the absence of a signed agreement.

“Without the Resolute Support mission, the progress made to date will not be sustainable,” he said. “A limited number of advisors will be required in 2015 to continue the train, advise, and assist mission.” Specifically, he said, the advisors will look at aviation, intelligence, special operations and building the capability to run security departments.

Without this help, Dunford said, Afghan forces will deteriorate. Al-Qaida and like-minded organizations would see an opportunity to again establish bases in Afghanistan, and that would be a threat to the United States and America’s national interests, the general told the senators.

Fortunately, Dunford said, all of the Afghan presidential candidates favor signing the bilateral security agreement and continued affiliation with NATO. He told the senators that he sees a force of between 8,000 and 12,000 in the country, with most involved in the train, advise, assist role and some limited counterterrorism operations.

U.S. MOVES A DOZEN F-16s TO POLAND "IN LIGHT OF SITUATION IN UKRAINE"

FROM:  U.S. DEFENSE DEPARTMENT 
Spokesman: F-16 Augmentation Continues U.S.-Poland Partnership
By Army Sgt. 1st Class Tyrone C. Marshall Jr.
American Forces Press Service

WASHINGTON, March 12, 2014 – A dozen more F-16s and 300 personnel based at Aviano Air Base, Italy, will augment the U.S. aviation detachment at Lask Air Base, Poland, a Pentagon spokesman announced today.

Defense Secretary Chuck Hagel announced last week that the United States would augment the aviation detachment in light of the situation in Ukraine, and Army Col. Steven Warren provided details today in a meeting with reporters.

Warren said 12 F-16 Fighting Falcons and associated personnel from the 555th Fighter Squadron at Aviano are expected to arrive in Poland by the end of the week. “This enhancement marks another milestone in the rotational deployment of U.S. military aircraft that we began in late 2012,” he added.

Hagel met with Polish Defense Minister Tomasz Siemoniak on March 9 to consider options for locations, with U.S. European Command deciding on the number of aircraft, Warren told reporters earlier this week. Previously planned rotations will continue, he said today, with this augmentation serving as an addition to those already scheduled.

“It’s consistent with the enduring partnership between the U.S. and Poland,” Warren said. “Augmenting this aviation detachment was a deliberate choice to demonstrate to our allies that U.S. commitments to our collective defense responsibilities are credible and remain in force. The work we’re doing with Poland does just that.”

7 CONVICTED BY JURY IN $97 MILLION MEDICARE FRAUD

FROM:  U.S. JUSTICE DEPARTMENT 
Wednesday, March 12, 2014
Jury Convicts All Seven Defendants in $97 Million Medicare Fraud Scheme

A federal jury in Houston today convicted two owners of a former Houston mental health care company, Spectrum Care P.A. (Spectrum), several of its employees and the owners of certain Houston group care homes for their participation in a $97 million Medicare fraud scheme.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Kenneth Magidson of the Southern District of Texas, Special Agent in Charge Stephen L. Morris of the FBI’s Houston Field Office and Special Agent in Charge Mike Fields of the Dallas Regional Office of HHS’s Office of Inspector General (HHS-OIG), the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU), Special Agent in Charge Joseph J. Del Favero of the Chicago Field Office of the Railroad Retirement Board, Office of Inspector General (RRB-OIG) and Special Agent in Charge Scott Rezendes of Field Operations of the Office of Personnel Management’s Office of Inspector General (OPM-OIG) made the announcement following a jury trial before U.S. District Judge Vanessa Gilmore in the Southern District of Texas.

Physicians Mansour Sanjar, 81, and Cyrus Sajadi, 66, the owners of Spectrum, were each convicted of conspiracy to commit health care fraud and conspiracy to pay kickbacks as well as related counts of health care fraud and paying illegal kickbacks.  Adam Main, 33, a physician’s assistant, was convicted of conspiracy to commit health care fraud and related counts of health care fraud.   Shokoufeh Hakimi, 66, administrator of Spectrum, was convicted of conspiracy to commit health care fraud, conspiracy to pay kickbacks and a related count of paying an illegal kickback.   Chandra Nunn, 35, a group home owner, was also convicted of conspiracy to commit health care fraud, conspiracy to pay and receive kickbacks and related counts of receiving illegal kickbacks.   Sharonda Holmes, 40, a patient recruiter, was convicted of conspiracy to pay and receive kickbacks and a related count of receiving an illegal kickback.   Shawn Manney, 51, a group home owner, was convicted of conspiracy to pay and receive illegal kickbacks.

According to evidence presented at trial, Sanjar and Sajadi orchestrated and executed a scheme to defraud Medicare beginning in 2006 and continuing until their arrest in December 2011.  Sanjar and Sajadi owned Spectrum, which purportedly provided partial hospitalization program (PHP) services.  A PHP is a form of intensive outpatient treatment for severe mental illness.   The Medicare beneficiaries for whom Spectrum billed Medicare for PHP services did not qualify for or need PHP services.  Sanjar, Sajadi, Main and Moore signed admission documents and progress notes certifying that patients qualified for PHP services, when in fact, the patients did not qualify for or need PHP services.  Sanjar and Sajadi also billed Medicare for PHP services when the beneficiaries were actually watching movies, coloring and playing games–activities that are not covered by Medicare.

Evidence presented at trial showed that Sanjar, Sajadi and Hakimi paid kickbacks to Nunn, Holmes, Manney and other group care home operators and patient recruiters in exchange for delivering ineligible Medicare beneficiaries to Spectrum.  In some cases, the patients received a portion of those kickbacks.  According to evidence presented at trial, Spectrum billed Medicare for approximately $97 million in services that were not medically necessary and, in some cases, werenot provided.

Sanjar, Sajadi and Nunn are scheduled to be sentenced on Sept. 8, 2014.   Main, Hakimi, Holmes and Manney are scheduled to be sentenced on Sept. 15, 2014.

The case was investigated by the FBI, HHS-OIG, Texas MFCU, RRB-OIG and OPM-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Texas.   The case is being prosecuted by Assistant Chief Laura M.K. Cordova and Trial Attorneys Jonathan T. Baum and William S.W. Chang of the Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,700 defendants who have collectively billed the Medicare program for more than $5.5 billion.  In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

HOME SECURITY COMPANY SETTLES FTC CHARGES IT CALLED CONSUMERS LISTED ON "DO NOT CALL REGISTRY"

FROM   FEDERAL TRADE COMMISSION 
FTC Reaches Settlement With Home Security Company that Called Millions of Consumers on the National Do Not Call Registry

The Federal Trade Commission, with the assistance of the U.S. Department of Justice, has settled a complaint against a Massachusetts-based home security company that illegally called millions of consumers on the FTC’s National Do Not Call (DNC) Registry to pitch home security systems.

According to the FTC, Versatile Marketing Solutions (VMS), under the guidance of its owner, Jasjit Gotra, called millions of consumers whose names and phone numbers VMS bought from lead generators. The lead generators claimed that those consumers had given VMS permission to contact them about the installation of a free home security system, but in reality, they had not. In its complaint, the FTC alleges that the defendants’ tactics violated the Commission’s Telemarketing Sales Rule.

The sales leads were obtained by illegal means through rampant use of robocalls from “Tom with Home Protection,” fake survey calls, and calls to phone numbers on the National Do Not Call Registry. According to the complaint, VMS subsequently called these consumers without first checking to see if they had registered their telephone numbers on the DNC Registry.

In addition, the complaint alleges that VMS ignored warning signs that the lead generators were engaged in illegal telemarketing practices. For example, many consumers contacted by VMS complained that they had not given the company permission to call, nor had they given permission to receive a robocall. Despite mounting complaints, VMS continued buying leads from the same lead generators, and calling consumers using those leads.

“Companies that use lead generators must exercise due diligence when they buy lists of phone numbers,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection, “or else they can be on the hook for illegal telemarketing. Relying on a say-so that the numbers were obtained legally, or that the consumers have agreed to be called, even if their numbers are on the Do Not Call Registry, isn’t enough.”  

According to the complaint, between November 2011 and July 2012, VMS made more than two million calls to consumers to try to sell home security goods and services. Of those calls, at least one million were to phone numbers listed on the DNC Registry, and more than 100,000 were to consumers who had previously told VMS not to call them again – another violation of the DNC rules.

The stipulated final court order settling the charges prohibits VMS and Gotra from making abusive telemarketing calls and from calling any consumer whose number is on the DNC Registry, unless they can prove that they have received written permission to make the call or that they have an established business relationship with that consumer. Further, it bars defendants from calling any consumer who has previously told VMS not to call them again. The order also places restrictions on how defendants can obtain and use lead-generated phone numbers in the future.

Finally, the order imposes a $3.4 million penalty judgment against the defendants, with all but $320,700 suspended due to their inability to pay. The entire amount will become due if the defendants are found to have misrepresented their financial condition.

The court settlement announced today resolves the FTC’s complaint against Versatile Marketing Solutions, Inc. also doing business as VMS Alarms, VMS, Alliance Security, and Alliance Home Protection; and its owner, Jasjit Gotra.

The Commission vote authorizing the staff to refer the civil penalty complaint to the Department of Justice, and to approve the proposed consent decree, was 4-0. The DOJ filed the complaint and proposed consent decree on behalf of the Commission in U.S. District Court for the District of Massachusetts on March 10, 2014. The proposed consent decree is subject to court approval.

NOTE: The Commission authorizes the filing of a complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. Consent judgments have the force of law when signed by a district court judge.

OWNER TRADING COMPANY PLEADS GUILTY TO DEFRAUDING INVESTORS OF OVER $30 MILLION

FROM:  SECURITIES AND EXCHANGE COMMISSION 
Former Owner of a Massachusetts-Based Trading Company Pleads Guilty to Multi-Million Dollar Fraud Scheme

The Securities and Exchange Commission announced today that on March 7, 2014, the former owner of Massachusetts-based Boston Trading and Research, LLC (BTR), pled guilty to charges stemming from his role in an investment scheme that defrauded more than 1,000 investors out of more than $30 million.

Craig A. Karlis, 53, of Hopkinton, MA, pled guilty before U.S. District Court Senior Judge Mark L. Wolf, to nine counts of wire fraud and two counts of filing false tax documents.  His sentencing is currently scheduled for June 2, 2014 at 3:00 p.m.  His business partner, Ahmet Devrim Akyil, 41, formerly of Hingham, MA, was charged with 10 counts of wire fraud.  According to a March 7, 2014 press release issued by the United States Attorney’s Office for the District of Massachusetts (USAO), Akyil left the United States for Turkey in 2009 and remains a fugitive.  The USAO unsealed an indictment charging Karlis and Akyil with criminal violations on October 28, 2010.

Also on October 28, 2010, the Commission filed a civil injunctive action in federal district court in Massachusetts against BTR, and its principals Ahmet Devrim Akyil and Craig Karlis for fraudulently raising millions of dollars from investors in a purported foreign currency (Forex) trading venture. Among other things, the Commission alleges that the defendants misappropriated some investor funds and lost the vast majority of remaining investor funds through Forex trading activity after promising investors that most of their funds were protected from such trading losses.

According to the Complaint, BTR collapsed in September 2008 due to significant losses accrued as a result of concealed trading far past the stop loss limits promised to investors. Ultimately, BTR distributed the remaining funds, which accounted for only approximately 10% of account balances, to its investors.

The Commission’s complaint, which is pending, alleges that BTR, Akyil, and Karlis violated Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933, and Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.  The Commission seeks the entry of a permanent injunction, disgorgement of ill-gotten gains plus pre-judgment interest, and the imposition of civil monetary penalties against BTR, Akyil, and Karlis.

AGENT ORANGE HEALTH CONCERNS RAISED BY CREWS OF C-123 PROVIDER AIRCRAFT

       Fairchild C-123K Provider  U.S. Air Force

FROM:  DEPARTMENT OF VETERANS AFFAIRS 

Agent Orange Residue on Post-Vietnam War Airplanes

Some Veterans who were crew members on C-123 Provider aircraft, formerly used to spray Agent Orange during the Vietnam War, have raised health concerns about exposure to residual amounts of herbicides on the plane surfaces.
Responding to these concerns, VA asked the Institute of Medicine to study possible health effects. Results are expected in late 2014.
If you have health concerns, talk to your health care provider or local VA Environmental Health Coordinator.

Testing for Agent Orange residue on planes

The U.S. Air Force (USAF) collected and analyzed numerous samples from C-123 aircraft to test for Agent Orange. USAF's risk assessment report (April 27, 2012) (2.3 MB, PDF) found that potential exposures to Agent Orange in C-123 planes used after the Vietnam War were unlikely to have put aircrew or passengers at risk for future health problems. The report’s three conclusions:
There was not enough information and data to conclude how much individual persons would have been exposed to Agent Orange.

It is expected that exposure to Agent Orange in these aircraft after the Vietnam War was lower than exposure during the spraying missions in Vietnam.

Potential Agent Orange exposures were unlikely to have exceeded standards set by regulators or to have put people at risk for future health problems.
How Veterans may have been exposed

During the Vietnam War, the U.S. Air Force used C-123 aircraft to spray Agent Orange to clear jungles that provided enemy cover in Vietnam. At the end of the spraying campaign in 1971, the remaining C-123 planes were reassigned to reserve units in the U.S. for routine cargo and medical evacuation missions spanning the next 10 years.

Crew members aboard one of these post-Vietnam C-123 planes reported smelling strong odors, which raised concerns about Agent Orange exposure – but Agent Orange is odorless. These odors may have come from various chemicals associated with aircraft.

Health effects of Agent Orange residue

The health effects of exposure to Agent Orange residue on airplanes differ from direct contact with liquid Agent Orange. In liquid or spray form, Agent Orange can enter the body through inhalation or ingestion (such as hand-to-mouth contact or getting into food). But in the dry form – for example, adhered to a surface – Agent Orange residue cannot be inhaled or absorbed through the skin, and would be difficult to ingest.

The potential for health effects depends on the amount of Agent Orange present, as well as its ability to enter the body.

After reviewing available scientific reports in 2011 and 2012, VA concluded that the exposure potential in these planes was extremely low and therefore, the risk of long-term health effects is minimal. If crew exposure did occur, it is unlikely that sufficient amounts of dried Agent Orange residue could have entered the body to have caused harm.

We will continue to review new scientific information on this issue as it becomes available.

We’ve also asked the Institute of Medicine of the National Academy of Sciences, an independent non-governmental organization, to study possible health effects from Agent Orange in C-123 post-Vietnam crew members. Results are expected in late 2014.

Research studies on Agent Orange

Research on the health effects of Agent Orange has been extensive and it continues. Diverse populations have been studied, including herbicide sprayers and manufacturers, other Vietnam-era Veterans, and those exposed during industrial accidents. This information helps us to determine what potential health effects may be related to different levels of exposure.

Find out more about research on health effects of Agent Orange.
Health concerns?

If you have health concerns about Agent Orange, talk to your health care provider or local VA Environmental Health Coordinator.
Not enrolled in the VA health care system? Find out if you qualify for VA health care.

Compensation benefits for health problems

The risk of long-term health problems from exposure to Agent Orange residue on post-Vietnam C-123 airplanes is minimal. Veterans may file a claim for disability compensation for health problems they believe are related to exposure to Agent Orange residue on post-Vietnam C-123 airplanes. Veterans must show on a factual basis that they were exposed in order to receive disability compensation for diseases related to Agent Orange exposure.

FORMER PUERTO RICO LAW ENFORCEMENT OFFICERS SENTENCED FOR HEROINE SMUGGLING SCHEME

FROM:  U.S. JUSTICE DEPARTMENT 
Thursday, March 6, 2014
Two Former Puerto Rico Law Enforcement Officers Sentenced for Scheme to Smuggle Heroin to Inmates

A former state marshal and a correctional officer in Puerto Rico were sentenced today for attempting to smuggle heroin to inmates in exchange for payment, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Rosa Emilia Rodríguez-Vélez of the District of Puerto Rico.

Joel Torres-Velazquez, 49, of Guánica, Puerto Rico, was sentenced to serve 37 months in prison, followed by three years of supervised release, by U.S. District Judge Francisco A. Besosa of the District of Puerto Rico.   He pleaded guilty on Nov. 6, 2013, to a one-count indictment charging him with attempt to distribute a controlled substance.

Jessica Moreno-Alicea, 39, of Ponce, Puerto Rico, was sentenced to serve 37 months in prison, followed by four years of supervised release, by U.S. District Judge Daniel R. Dominguez of the District of Puerto Rico.   She pleaded guilty on Dec. 6, 2013, to a one-count indictment charging her with attempt to distribute a controlled substance.

Torres-Velazquez was paid $600 to deliver a package of heroin to an inmate at the Ponce Superior Court, where Torres-Velazquez worked as a state marshal.   On March 30, 2011, Torres-Velazquez met with an undercover agent, who he believed was a drug dealer, and was given what he believed to be a package of heroin.   He delivered the purported heroin to an inmate in the courthouse that same day.

Moreno was paid $800 to deliver a package of heroin to an inmate at the Ponce State Penitentiary, where Moreno worked as a correctional officer.   On Feb. 3, 2011, Moreno met with an undercover agent, who she believed was a drug dealer, and was given what she believed to be heroin.   She delivered the purported heroin to an inmate in the prison on Feb. 8, 2011.

The case was investigated by the FBI’s San Juan Division.   The case was prosecuted by Assistant U.S. Attorney Hector Ramirez-Carbó of the District of Puerto Rico and Trial Attorney Menaka Kalaskar of the Criminal Division’s Public Integrity Section.

HHS SAYS HEALTH INSURANCE MARKETPLACE ENROLLMENT HITS 4.2 MILLION

FROM:  DEPARTMENT OF HEALTH AND HUMAN SERVICES 
Enrollment in the Health Insurance Marketplace climbs to 4.2 million in February
27 percent of February Federal Marketplace enrolled are young adults

Enrollment in the Health Insurance Marketplace continued to rise in February to a five-month total of 4.2 million.

As in January, the percent of young adults who selected a Marketplace plan was 3 percentage points higher than it was from October through December (27 percent versus 24 percent).  Based on enrollment patterns in other health care programs, it is expected that more people will sign up as we get closer to the March 31st deadline.

“Over 4.2 million Americans have signed up for affordable plans through the Marketplace,” said HHS Secretary Kathleen Sebelius. “Now, during this final month of open enrollment our message to the American people is this: you still have time to get covered, but you’ll want to sign up today – the deadline is March 31st.”

Key findings from today’s report include:

More than 4.2 million (4,242,300) people selected Marketplace plans from Oct. 1, 2013, through Mar. 1, 2014, including 1.6 million in the State Based Marketplaces and 2.6 million in the Federally-facilitated Marketplace. About 943,000 people enrolled in the Health Insurance Marketplace plans in the February reporting period, which concluded March 1, 2014.
Of the more than 4.2 million:
55 percent are female and 45 percent are male;
31 percent are age 34 and under;
25 percent are between the ages of 18 and 34;
63 percent selected a Silver plan (up one percentage point over the prior reporting period), while 18 percent selected a Bronze plan (down one point); and
83 percent selected a plan and are eligible to receive Financial Assistance (up one point).
Today’s report details state-by-state information where available.  In some states, only partial datasets were available.

The report features cumulative data for the five-month reporting period because some people apply, shop, and select a plan across monthly reporting periods.  Enrollment is measured as those who selected a plan.