PRESIDENT OBAMA AND IRISH PRIME MINISTER KENNY MAKE REMARKS AFTER MEETING

FROM:  THE WHITE HOUSE 

Remarks by President Obama and Prime Minister Kenny of Ireland after Bilateral Meeting

Oval Office

11:15 A.M. EDT

PRESIDENT OBAMA:  Well, it is wonderful to have Taoiseach Kenny back here in the Oval Office.  This is one of my favorite times of year because I'm able to join with our friends from Ireland to celebrate the incredible bond that exists between our two countries.  I think it's fair to say that there are very few countries around the world where the people-to-people ties are so strong.

And in addition to sharing values and sharing a commitment to democracy, we also share these family ties that go back generations.  And I want to once again thank the people of Ireland for the incredible hospitality that they showed me and Michelle and the girls each time that we've had an opportunity to visit Ireland. 

I started the meeting today congratulating Taoiseach Kenny on the economic progress that's been made over the last several years in Ireland.  Obviously Ireland was hit hard by the financial crisis and problems with its banking system.  It required some very tough decisions that Taoiseach Kenny was willing to take.  But what we've now seen is Ireland emerge from its assistance program in a much stronger position on the global stage and in global markets.  And as a consequence, I think it's really well positioned to start building for the future and attracting businesses with a highly skilled and well-educated workforce. 

And there is tremendous investment by U.S. companies in Ireland.  There’s tremendous investment here in the United States by Irish companies.  We're an example of the mutually beneficial trade that can take place across the Atlantic.  And that's why we appreciate Taoiseach Kenny being a strong leader as we move forward on the Transatlantic trade agreement that is currently being negotiated between the United States and the EU.

We had an opportunity to discuss a range of global affairs.  Obviously on our minds right now is the situation in Ukraine.  Ireland has been a strong voice in the European Council for the need to send a clear message of support for Ukrainian democracy and self-determination, and a strong message to Russia that it should not violate the integrity and the sovereignty of its neighbor.  We continue to hope that there’s a diplomatic solution to be found, but the United States and Europe stand united not only in its message about Ukrainian sovereignty but also that there will be consequences if, in fact, that sovereignty continues to be violated.

We had an opportunity to discuss the fact that Ireland does tremendous work around the world on a whole range of issues.  It punches above its weight when it comes to humanitarian efforts.  We very much appreciate that. 

Closer to home, we both share an interest in seeing Northern Ireland continue to take the next steps that are necessary to finally bring an end to what so often has been a tragic history. I was disappointed, the U.S. government was disappointed that the All-Party Talks did not arrive at a final conclusion and agreement.  But we're urging the parties to continue to work and negotiate.  And I know that the good influence coming from Dublin will help to encourage that to move out of the past and get the kind of history that -- or the kind of future that Northern Ireland so richly deserves.

So I greatly appreciate, Taoiseach, your visit.  We look forward to a good lunch and I suspect some good Irish music.  And we will have a wonderful St. Patrick’s Day reception this afternoon.  The Taoiseach, I understand, has brought his children here this time, so they’ll be able to celebrate alongside us.  And to you and your delegation, thank you again for your friendship and support.

PRIME MINISTER KENNY:  Let me just say it's a privilege to be here in the Oval Office with the President to continue these traditions and discussions that we've had between our two countries.  I might say that on this occasion we did not have to have a detailed discussion about Ireland’s economy.  I was able to report to the President the progress our country has made in the last couple years.

The President spoke about the issues that we did discuss.  In addition to that, we also discussed the question of immigration reform, which is an issue for Ireland and for many other countries, and we hope to pursue those discussions down at the Capitol building later on with a number of other representatives.

So it's a privilege to be here.  It’s a great occasion for us.  And I've given the President a review of the attitude and the happenings at the European Council meeting, particularly in relation to the situation in Ukraine.  And we hope that the entirety of message and strength of feeling can prevent very difficult circumstances arising there.

I explained to him the European Council meeting presentation by the Ukrainian President, the discussion with the EPP Congress with Prime Minister Cameron in Downing Street earlier this week and our hopes that this matter can be resolved.

So, again, my privilege to be here on behalf of the Irish people to wish the President, the First Lady and his family every success in their onerous responsibilities with so many places around the world requiring the assistance of the United States.

PRESIDENT OBAMA:  Thank you.

Thank you, everybody.

Q    Will Vice President Biden come to Ireland?

PRESIDENT OBAMA:  You know, Biden wants to come to Ireland  -- he lobbies me every week to go to Ireland.  So I guarantee you he'll get there.  He'll get there.

Thank you, everybody.

Q    Will you come back to join us again?

PRESIDENT OBAMA:  Oh, I'd love -- tell everybody in Moneygall I said hi.

END 
11:22 A.M. EDT

SECRETARY KERRY'S REMARKS ON NINTH ANNIVERSARY OF LEBANON'S CEDAR REVOLUTION

FROM:  U.S. STATE DEPARTMENT 

Ninth Anniversary of the Cedar Revolution

Press Statement

John Kerry
Secretary of State

Washington, DC

March 14, 2014

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Today, the ninth anniversary of the Cedar Revolution, we remember the Lebanese people who took to the streets in mass demonstrations to demand sovereignty, freedom and true democracy for Lebanon. This peaceful revolution closed a long chapter of foreign domination of Lebanese politics and brought a new beginning to the people of Lebanon, as they sought accountability for the assassination of former Prime Minister Rafik Hariri and many others.
The work of the Cedar Revolution is not finished, and in the past nine years, new challenges have emerged that threaten Lebanon’s stability. We stand with the people of Lebanon as they continue to reject violence, extremism, and entanglement in foreign conflicts. We call on all parties to respect United Nations Security Council Resolution 1701 and Lebanon’s key political agreements, including the Taif Accord and the Baabda Declaration, which reinforce the strength, sovereignty, and independence of the Lebanese state.

The United States will continue to provide tangible economic and military support for Lebanon’s sovereignty and stability, including its assistance to the Lebanese Armed Forces and the Internal Security Forces. In the spirit of all those who peacefully assembled on March 14 nine years ago to insist on respect for Lebanon’s democratic traditions, we also look to Lebanon to hold this year’s presidential and parliamentary elections on time and in accordance with the Lebanese constitution.

SECRETARY OF STATE KERRY'S REMARKS ON ATTEMPT TO RESOLVE SITUATION IN UKRAINE

FROM:  U.S. STATE DEPARTMENT 

Press Availability in London

Press Availability

John Kerry
Secretary of State

The Churchill Hotel

London, United Kingdom

March 14, 2014

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SECRETARY KERRY: Good afternoon, everybody. President Obama, as you know, asked me to come to London in an effort to try to deescalate the situation in Ukraine. Today, Foreign Minister Lavrov and I engaged in a very in-depth, constructive dialogue on how to address legitimate concerns in the context of a unified, sovereign Ukraine. The United States strongly supports the interim government of Ukraine, and we continue to favor a direct dialogue between Ukraine and Russia as the very best way to try to resolve the crisis.

I came here in good faith with constructive ideas – which we did put forward, on behalf of President Obama – in order to try to restore and respect the sovereignty and territorial integrity of Ukraine, while addressing at the same time Russia’s legitimate concerns. Foreign Minister Lavrov and I talked for a good six hours, and the conversation was very direct, very candid, frank, and I say constructive because we really dug into all of Russia’s perceptions, their narrative, our narrative, our perceptions, and the differences between us.

I presented a number of ideas on behalf of the President, which we believe absolutely could provide a path forward for all the parties. However, after much discussion, the Foreign Minister made it clear that President Putin is not prepared to make any decision regarding Ukraine until after the referendum on Sunday. The United States position on that referendum, I must say, is clear and it’s clear today: We believe the referendum is contrary to the constitution of Ukraine, is contrary to international law, is in violation of that law, and we believe it is illegitimate, and as the President put it, illegal under the Ukrainian constitution. Neither we nor the international community will recognize the results of this referendum.

And we also remain deeply concerned about the large deployments of Russian forces in Crimea and along the eastern border with Russia, as well as the continuing provocations and some of the hooliganism of young people who’ve been attracted to cross the border and come into the east, as well as some of those who’ve lived there.

I was clear with Foreign Minister Lavrov that the President has made it clear there will be consequences if Russia does not find a way to change course. And we don’t say that as a threat, we say that as a direct consequence of the choices that Russia may or may not choose to make here. If Russia does establish facts on the ground that increase tensions or that threaten the Ukrainian people, then obviously that will beg an even greater response, and there will be costs.

President Obama and I could not be more convinced that there is a better way for Russia to pursue legitimate interests in Ukraine. We believe it is not insignificant that we acknowledge there are legitimate interests – historical, cultural, current strategic. These are real interests, and I think all of us who are joined together in the EU and extended contact group understand those interests and are prepared to respect them. But that requires also that Russia would respect the multilateral structure that has guided our actions since World War II and the need for all of us to try to resolve this challenge and to meet those interests through the international, multilateral legal norms, which should guide all of our behavior.

Foreign Minister Lavrov and I talked about that, and we talked about the other options that are available – options of dialogue, options of various contact meetings that could take place, options of international legal remedy, options of joint, multilateral efforts that would protect minorities, UN options, international human rights organization options, many options for the ways in which any challenges to the safety or security or rights of people could be addressed. We are certainly prepared to join in an effort to protect those rights, whether they be the rights of a Ukrainian living in the west, a Ukrainian living in the east, somebody of Russian language and Russian descent who might feel threatened. All minorities, all people should be protected.
Foreign Minister Lavrov and I agreed that we are going to stay in touch in the next days on Ukraine, as well as on the other issues of concern, which we are working on – Syria, Iran, and other challenges of mutual concern.

Before I close, I just want to reiterate what President Obama said in the Oval Office on Wednesday when he visited with Ukrainian Prime Minister Arseniy Yatsenyuk. The United States stands with the people of Ukraine in their desire to make their own choices about their future, and to be able to live their lives in a unified, peaceful, stable, and democratic Ukraine. The President said clearly that is our only interest. That is what drives us. Not a larger strategy, nothing with respect to Russia directly. We are interested in the people of Ukraine having the opportunity to have their country’s sovereignty and territorial integrity respected, as we would ask that to happen for any country.

So I will be briefing Prime Minister Yatsenyuk shortly, as well as all of our colleagues and counterparts in the EU and the members of the contact group. As soon as I leave here, I will engage in those briefings, and I look forward to taking a couple of questions.

MS. PSAKI: The first question is from Michael Gordon of The New York Times.

QUESTION: Mr. Secretary, as you noted, Russian troops are carrying out an extensive military exercise near Ukraine, and at the same time, the Russian Foreign Ministry said just today that the Kremlin reserves the right to protect what it calls compatriots’ lives in Ukraine. Did you obtain a clear assurance from Mr. Lavrov that Russia would not use these forces to intervene in eastern Ukraine? What – as they have in Crimea. What did they say is the purpose of this exercise? And has Russia abided by its obligations to provide OSCE nations with timely and accurate information about the size of the exercise, the types of forces involved, the purpose of the exercise? Have they done that for this current exercise and have they done that for the one immediate prior?

SECRETARY KERRY: Well, let me answer the second part of the question first. I don’t know whether or not they’ve made that notification. I’ve been wrapped up in these talks and I’ve been wrapped up in other talks, so I’m not aware of whether or not that notification was made.
But I can tell you, indeed, we talked about these exercises and we talked about the level of troops that are deployed, where they’re deployed, what the purpose is, and I raised very clearly the increased anxiety that is created within Ukraine as a consequence of this. And we talked about one of the proposals that we made – I’m not going to go into all of them, but one of the proposals we made discussed the possibility of drawing all forces back, reducing these tensions, returning to barracks, having a freeze on those kinds of deployments while the diplomacy is working.

I think, in fairness, that Foreign Minister Lavrov is going to report that proposal back to President Putin, as he did all – as he will all of the proposals that we put on the table this afternoon. He’s going to fly back, have that discussion with him, so the president will be well aware – President Putin – of all of the options that we’ve offered. But that was certainly one of the principal areas of discussion is this increased tension created by these additional deployments in Crimea as well as along the border of the east, and the need to try to reduce that kind of tension. And it’s our hope that they will take those necessary steps.
With respect to assurances, it’s my understanding this afternoon that Foreign Minister Lavrov gave assurances publicly with respect to their intent, but I think all of us would like to see actions, not words, that support the notion that people are moving in the opposite direction and, in fact, diminishing their presence. And I think right now, in this particular climate, given what has been happening, we really need to hear a more declarative policy in order to make clear where Russia is proceeding with respect to these troops and these exercises.

MS. PSAKI: Lara Jakes from AP.

QUESTION: Thank you. Mr. Secretary, you said last week that Crimea is Ukraine. Foreign Minister Lavrov just told reporters that Crimea is more important to Russia than Falklands is to Britain. Given that, did you get any indication from Mr. Lavrov that Russia would not annex Crimea in the event of a vote to secede? And if not, or even if so, why wouldn’t even greater autonomy for Crimea, as Kyiv said it will allow, why would it not set a dangerous precedent for the rest of the region in terms of appeasing Russia?

SECRETARY KERRY: Well, the issue of additional autonomy for Crimea has been one that has constantly been on the table – been on the table. It’s been on the table prior to Russia making these moves. So that’s really a decision for the Ukrainian Government to make, number one. Number two, in his visit to Washington, Prime Minister Yatsenyuk made it very clear they are prepared to provide additional autonomy, and they see that as no threat to the integrity and sovereignty of Ukraine. They in fact, I think, see it as strengthening it. But we don’t know definitively what President Putin is going to decide.

What was made clear today in the context of President Putin being unwilling to make any decisions regarding the next steps until the vote has been taken – what was made clear is that he has said that once that referendum vote is taken, he will make a decision with respect to what will happen. And I would say to him today, as I said to Foreign Minister Lavrov, that is a decision of enormous consequence with respect to the global community. We believe that a decision to move forward by Russia to ratify that vote officially within the Duma would in fact be a backdoor annexation of Crimea, and that it would be against international law, and frankly, fly in the face of every legitimate effort to try to reach out to Russia and others to say there is a different way to proceed, to protect the interests of Crimeans, to protect Russia’s interests, and to respect the integrity of Ukraine and the sovereignty of Ukraine.

We hope President Putin will recognize that none of what we’re saying is meant as a threat. It’s not meant as a – in a personal way. It is meant as a matter of respect for the international multilateral structure that we have lived by since World War II and for the standards of behavior about annexation, about secession, about independence and how countries come about it.
Here in Great Britain, the Parliament voted to legitimize a vote in Scotland about where Scotland would want to proceed. Under the constitution of Ukraine, the Ukrainian legislature in Kyiv would have to vote to legitimize a secession effort by any state or oblast or province or entity or autonomy – autonomous region of Ukraine. That hasn’t happened here. That’s why this runs against the constitution of Ukraine.

So we very much hope that President Putin will hear that we are not trying to challenge Russia’s rights or interests, it’s interest in protecting its people, its interests in its strategic position, its port agreement. None of those things are being threatened here. They can all be respected even as the integrity of Ukraine is respected, and we would hope that President Putin would see that there is a better way to address those concerns that he has that are legitimate, and we hope he will make that decision. He has decided not to make any other decision until that vote takes place on Sunday.

MS. PSAKI: The final question is from Jo Biddle of AFP.

QUESTION: Thank you. Mr. Secretary, Foreign Minister Lavrov just told reporters in London after your talks that there’s no common vision between the West and Russia on Ukraine, that international mediators are not needed in this situation, and that Russia will respect the results of Sunday’s referendum in Crimea. Despite your message just now to President Putin that this is not meant as a threat, do you believe that in fact that diplomacy is failing here and that they are just going to go ahead with what you just termed as a possible backdoor annexation of Crimea?
And is it now a fait accompli that on Monday we will see sanctions from the European Union and the United States? And what gives you confidence that even those sanctions will in any way change President Putin’s mind, given that this week we’ve seen the ruble falling and today again the Moscow stocks have been falling to a four-year low? Thank you.

SECRETARY KERRY: Well, I suspect the market in Russia, in Moscow, can be significantly affected by these choices. It already is being affected. And obviously, if there are going to be more sanctions, I think that’ll have an impact. But the reality is that President Putin’s statement that he will respect the vote offers him many options as to how he chooses to respect the vote. If the people of Crimea vote overwhelmingly, as one suspects they will, to affiliate or be associated with Russia, you can respect the vote by making sure that their autonomy is increased, that their needs that have prompted that vote are properly respected, without necessarily having to make a decision to annex.

So until that decision is made, I’m not going to interpret what it may or may not mean. I think it’s more important for the president – for President Putin to understand that we are prepared to respect his interests and rights, and that they can be fully respected, and that he can actually have a claim to have served his purpose of protecting the people that he is interested in protecting by augmenting their rights and by asserting his prerogatives at the end of this effort. So there are other options, and that’s what we’re continually trying to say. And until he has made his decision, those options are still on the table and alive, and we hope he will make a different set of choices.

With respect to – what was the other part of your question about the --

QUESTION: Whether there’ll be sanctions automatically --

SECRETARY KERRY: Well, with respect to the President and the European Community and everybody have said if the referendum takes place, there will be some sanctions. There’ll be some response, put it that way. If there’s greater diplomatic opportunity that could be pursued, and that is in fact on the table, then I’m confident whatever the response is would be calibrated accordingly. But if, on the other hand, a decision is made that’s negative and/or flies in the face of all of the rationale that the EU and others have put on the table for illegality, that will obviously demand some further response, which I’m confident both the EU and the United States will produce.

It is not our preference. It is not where we want to go. It is not what we are choosing as a first choice. But if the wrong choices are made, then there will be no choice but to respond appropriately because of the gravity of this breach of international standard, breach of international law, and challenge, frankly, to the global standard by which nations have been called on to try to behave.

And we believe that the consequences are consequences that could be felt in many other parts of the world. There are many places where people might take the wrong lesson from that, and I think many people are concerned about that.
Thank you all very, very much. Thank you.

U.S. DEFENSE DEPATMENT CONTRACTS FOR MARCH 14, 2014

FROM:  U.S. DEFENSE DEPARTMENT 
CONTRACTS
 NAVY

Bath Iron Works, Bath, Maine, is being awarded a $642,583,946 modification to previously awarded contract (N00024-13-C-2305) to exercise options for construction of a DDG 51 class ship.  The modification also provides $79,400,000 in advanced procurement funding for the fiscal 2016-2017 ships.  Work will be performed in Bath, Maine (58.1 percent); Cincinnati, Ohio (6.5 percent); Walpole, Mass. (4.5 percent); South Portland, Maine (2 percent); York, Pa. (1.9 percent); Charlottesville, Va. (1.8 percent); Coatesville, Pa. (1.7 percent); Erie, Pa. (1 percent), and other locations less than one percent (22.5 percent) and is expected to be completed by July 2023.  Contract funds in the amount of $100,000,000 will expire at the end of the current fiscal year.  The Naval Sea Systems Command, Washington, D.C., is the contracting activity.

Huntington Ingalls Inc., Pascagoula, Miss., is being provided funding in the amount of $601,990,190 under previously awarded contract (N00024-13-C-2307) to fund construction and exercised options for one DDG 51 class ship in fiscal 2014.  The modification also provides $79,400,000 in advanced procurement funding for the fiscal 2016-2017 ships.  Work will be performed in Pascagoula, Miss. (56.3 percent); Cincinnati, Ohio (6.9 percent); Walpole, Mass. (4.5 percent); York, Pa. (1.9 percent); Camden, N.J. (1.4 percent); Erie, Pa. (1.3 percent); Charlottesville, Va. (1 percent), and other locations less than one percent (26.7 percent), and is expected to be completed by July 2023.  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.

ARMY

Leidos, Inc., Reston, Va., was awarded a $9,791,760 modification (P00003) to cost-plus-fixed-fee, sole-source contract W91CRB-13-C-0016 for information technology support services for the maintenance of existing Army Enterprise Equipping System systems.  Work will be performed in Reston, Va., with an estimated completion date of March 15, 2015.  Fiscal 2014 operations and maintenance, Army funds in the amoung of $7,791,760 and fiscal 2014 research, development, test and evaluation funds in the amount of $2,000,000 will be obligated at time of award.  U.S. Army Contracting Command-Aberdeen Div D, Aberdeen Proving Ground, Md., is the contracting activity.

Tikigaq Construction LLC*, Wasilla, Alaska, was awarded a $7,954,440 firm-fixed-price contract for the West Bank and vicinity Hurricane Storm Damage Risk Reduction System/Mississippi River Levee, Mississippi River and Tributaries Project.  Funding is from fiscal 2014, other appropriations and the performance location is Bell Chase, La.  The estimated date of completion is May 8, 2015.  Bids were solicited via the Web with 16 received.  The U.S. Army Corps of Engineers-New Orleans District, New Orleans, La., is the contracting activity (W912P8-14-C-0025).  

AIR FORCE

Exelis Inc. (LMGI), Clifton, N.J., has been awarded a not-to-exceed $75,281,878 firm-fixed-price, time and material, undefinitized contract award for ALQ-211(V)-9 Advanced Integrated Defensive Electronic Warfare System (AIDEWS) pod acquisition.  The contractor will provide 21 ALQ-211(V)-9 AIDEWS pods, associated support services, support equipment, countermeasures dispensing system integration and spares in support of the Turkish Air Force F-16D Block 50 program.  Work will be performed at Clifton, N.J., and is expected to be complete May 2017.  This award is the result of a source-directed, sole-source acquisition and is 100 percent foreign military sales for Turkey. Air Force Life Cycle Management Center/WNKCB, Robins Air Force Base, Ga., is the contracting activity (FA8540-14-C-0007).

MISSILE DEFENSE AGENCY

CORRECTION:  The contract announced March 13, 2014 to Lockheed Martin had an incorrect amount of total contract value increase.  The correct award is: Lockheed Martin Corp., Moorestown, N.J., is being awarded an $8,058,225 modification to previously awarded cost-plus fixed-fee contract (HQ0276-10-C-0003) to provide test support at the Aegis Ashore Missile Defense Test Complex.  As a result of this modification, the total contract value will increase from $328,635,159 to $336,693,384.  The work will be performed at the Pacific Missile Range Facility, Kekaha, Hawaii.  The period of performance is from contract award through Dec. 31, 2015.  Fiscal 2014 research, development, test and evaluation funds will be used to incrementally fund this effort.  The Missile Defense Agency, Dahlgren, Va., is the contracting activity.


*Small Business

West Wing Week 03/14/14 or, "What's Up, Captain America?"

ATTORNEY GENERAL HOLDER URGES CHANGES TO PENALTIES FOR LOW-LEVEL DRUG TRAFFICKERS

FROM:  U.S. JUSTICE DEPARTMENT 
 March 13, 2014

Attorney General Holder Urges Changes in Federal Sentencing Guidelines to Reserve Harshest Penalties for Most Serious Drug Traffickers

In Testimony to Sentencing Commission, Holder Endorses Proposal That Would Reduce the Average Sentence for Low-level Drug Offenders by Nearly a Year
In testimony delivered before the U.S. Sentencing Commission Thursday, Attorney General Eric Holder endorsed a proposed change to the Federal Sentencing Guidelines that would reserve the harshest penalties for the most serious drug offenders.

The Sentencing Commission proposal, first unveiled in January, would lower by two levels the base offense associated with various drug quantities involved in drug trafficking crimes. If adopted, the change would impact nearly 70% of all drug trafficking offenders and reduce the average sentence by 11 months, or nearly 18%, according to the Commission.

As an added result of the new proposal, the Commission projects that the Bureau of Prisons population would drop by 6,550 inmates at the end of five years.

“This straightforward adjustment to sentencing ranges – while measured in scope – would nonetheless send a strong message about the fairness of our criminal justice system,” Holder testified. “And it would help to rein in federal prison spending while focusing limited resources on the most serious threats to public safety.”

The move is Holder’s latest step to alter the federal government’s approach to dealing with nonviolent drug offenders. Last August, Holder announced his “Smart on Crime” initiative, which included a major change to the department’s charging policy intended to reserve strict, mandatory minimum sentences for high-level or violent drug traffickers.

The “Smart on Crime” initiative would help ease the nation’s overcrowded prison system. Today, the United States comprises just five percent of the world’s population but it incarcerates almost a quarter of the world’s prisoners. In 2010 alone, state and federal governments spent $80 billion on incarceration. And of the 216,000 current federal inmates, nearly half are serving time for drug-related crimes.

The Commission is expected to vote on the proposal endorsed by Holder in April. Until then, the Justice Department will direct prosecutors not to object if defendants in court seek to have the newly proposed guidelines applied to them during sentencing.

The complete text of the Attorney General’s statement to the Sentencing Commission, as prepared for delivery, is below.

Testimony by Attorney General Eric H. Holder, Jr.
U.S. Sentencing Commission
March 13, 2014

Chief Judge [Patti] Saris and Members of the Commission: good morning, and thank you for the invitation to appear before you to discuss our shared goals – and to provide the Justice Department’s views on proposed changes to the Federal Sentencing Guidelines related to certain drug trafficking crimes.

In particular, I appreciate the opportunity to speak in support of the amendments under consideration today.  The Justice Department strongly supports the Commission’s proposed change to the Drug Quantity Table.  If adopted, this amendment would lower by two levels the base offense levels associated with various drug quantities involved in drug trafficking crimes.  This would have the effect of modestly reducing guideline penalties for drug trafficking offenses while keeping the guidelines consistent with current statutory minimums – and continuing to ensure tough penalties for violent criminals, career criminals, or those who used weapons when committing drug crimes.

This straightforward adjustment to sentencing ranges – while measured in scope – would nonetheless send a strong message about the fairness of our criminal justice system.  And it would help to rein in federal prison spending while focusing limited resources on the most serious threats to public safety.  Let me be clear, my primary obligation as Attorney General is to ensure the safety of the American people.  The changes that I have implemented over the past year are designed to do exactly that – while making our system more fair and more efficient.

This proposed amendment is consistent with the “Smart on Crime” initiative I announced last August.  Its implementation would further our ongoing effort to advance commonsense criminal justice reforms.  And it would deepen the Department’s work to make the federal criminal justice system both more effective and more efficient when battling crime and the conditions and behaviors that breed it.

As it stands – and as this Commission has recognized – certain types of cases result in too many Americans going to prison for too long, and at times for no truly good public safety reason.  Although the United States comprises just five percent of the world’s population, we incarcerate almost a quarter of the world’s prisoners.  One in 28 American children currently has a parent behind bars.  State and federal governments spent a combined $80 billion on incarceration during 2010 alone.  And as you know – of the more than 216,000 current federal inmates – nearly half are serving time for drug-related crimes.

This focused reliance on incarceration is not just financially unsustainable – it comes with human and moral costs that are impossible to calculate.  That’s why, in recent years – under the leadership of President Obama and alongside members of this Commission; with the support of policymakers as well as prosecutors; and with the expertise of advocates and researchers, law enforcement officials, and government leaders on both sides of the aisle – we have taken significant steps to improve criminal justice policies and implement targeted reforms.  I am particularly proud of the work we did together to reduce the inappropriate and unjust 100-to-1 sentencing disparity between crack and powder cocaine – a disparity that this Commission had correctly found to be unjustifiable, and which President Obama alleviated with the signing of the Fair Sentencing Act in 2010.

 Just over a year ago, in an effort to take our collective work to a new level, I launched a targeted Justice Department review of the federal criminal justice system – to identify areas for improvement, and to seek ways to make the system more efficient, more effective, and more closely aligned with our highest ideals, while not sacrificing our duty to promote public safety.  Last August, I announced a new “Smart on Crime” initiative – based on the results of that review – and it is already allowing the Justice Department to make critical improvements; to conserve precious resources; to improve outcomes; and to disrupt the destructive cycle of poverty, incarceration, and crime that traps too many Americans and weakens entire communities.

 Among the key changes I mandated as part of this initiative is a modification of the Justice Department’s charging policies – to ensure that people convicted of certain low-level, nonviolent federal drug crimes will face sentences appropriate to their individual conduct – rather than stringent mandatory minimums, which will now be applied only to the most serious criminals.  The Commission’s proposed amendment to the Federal Sentencing Guidelines would help to further advance and institutionalize this work, controlling the federal prison population and ensuring just and proportional sentences.

I’m pleased to note that this approach enjoys significant bipartisan support on Capitol Hill, where a number of leaders, including Senators Patrick Leahy, Dick Durbin, and Mike Lee – along with Representatives Bobby Scott and Raul Labrador – have introduced legislation that would give judges more discretion in determining appropriate sentences for those convicted of certain crimes.  By reserving the most severe penalties for dangerous and violent drug traffickers, we can better promote public safety, deterrence, and rehabilitation while saving billions of dollars and strengthening communities.  And as my colleagues and I work with Congress to refine and pass this legislation, we are simultaneously moving forward with a range of other reforms.

We’re investing in evidence-based diversion programs – like drug treatment initiatives and veterans courts – that can serve as alternatives to incarceration in some cases.  We are working to reduce unnecessary collateral consequences for formerly incarcerated individuals seeking to rejoin their communities.  And we are building on innovative, data-driven reinvestment strategies that have in many cases been pioneered at the state level.

In recent years, no fewer than 17 states – supported by the Department’s Justice Reinvestment Initiative, and led by officials from both parties – have directed significant funding away from prison construction and toward evidence-based programs and services, like supervision and drug treatment, that are proven to reduce recidivism while improving public safety.  Rather than increasing costs, a new report – funded by the Bureau of Justice Assistance – projects that these 17 states will actually save $4.6 billion over a 10-year period.  Many have already seen drops in recidivism rates – as well as overall crime rates – even as their prison populations have declined.  And although the full impact of our justice reinvestment policies and other reforms remains to be seen, it’s clear that these efforts are bearing fruit – and showing significant promise across the country.

We can be encouraged by this ongoing work – which is enabling us to better promote public safety, deterrence, and rehabilitation while making our expenditures smarter and more productive.  Yet each of us is here this morning because we recognize that we cannot yet be satisfied.  And a great deal remains to be done.

By adopting these proposed amendments to the Federal Sentencing Guidelines, this Commission can take an important step to allow judges to make commonsense determinations; to provide legal professionals and law enforcement leaders with the 21st-century solutions they need to address 21st-century challenges; and to build on the progress we’ve already seen in constructing a criminal justice system that deters and punishes crime, keeps us safe, and ensures that those who have paid their debts have the chance to become productive citizens.

As the Commission considers these and other actions – and as you hear testimony from a diverse group of expert panelists over the course of today’s hearing – I urge you to seize this opportunity to make our criminal justice system more fair and to keep the American people more safe.

I look forward to continuing to work closely with each of you – and with leaders in Congress and throughout the Administration – to strengthen America’s criminal justice system and forge the more just society that everyone in this country deserves.

I thank you, once again, for the opportunity to appear before you today.  And I would be happy to take a few questions at this time.

OBAMA ADMINISTRATION THREATENS AID LOSS TO PREDATORY CAREER COLLEGES

FROM:  U.S. EDUCATION DEPARTMENT 
Obama Administration Takes Action to Protect Americans from Predatory, Poor-Performing Career Colleges

New 'gainful employment' proposal targets training programs that saddle students with debt but provide few opportunities for success.

The Obama Administration announced today new steps to address growing concerns about burdensome student loan debt by requiring career colleges to do a better job of preparing students for gainful employment—or risk losing access to taxpayer-funded federal student aid.

The proposed regulations released by the U.S. Department of Education will help to strengthen students' options for higher education by giving all career training programs an opportunity to improve, while stopping the flow of federal funding to the lowest-performing ones that fail to do so.

"Higher education should open up doors of opportunity, but students in these low-performing programs often end up worse off than before they enrolled: saddled by debt and with few—if any—options for a career," said U.S. Education Secretary Arne Duncan. "The proposed regulations address growing concerns about unaffordable levels of loan debt for students enrolled in these programs by targeting the lowest-performing programs, while shining a light on best practices and giving all programs an opportunity to improve."

To qualify for federal student aid, the law requires that most for-profit programs and certificate programs at non-profit and public institutions prepare students for gainful employment in a recognized occupation. Some of these programs, whether public, private, or for-profit, empower students to succeed by providing high-quality education and career training. But many of these programs, particularly those at for-profit colleges, are failing to do so—at taxpayers' expense and the cost of students' futures.

Students at for-profit colleges represent only about 13 percent of the total higher education population, but about 31 percent of all student loans and nearly half of all loan defaults. In the most recent data, about 22 percent of student borrowers at for-profit colleges defaulted on their loans within three years, compared to 13 percent of borrowers at public colleges.

Most students at for-profit gainful employment programs who graduated with an associate degree were also left with federal student loan debt, which averaged $23,590, while the majority of students at community colleges did not borrow. And of the for-profit gainful employment programs the Department could analyze and which could be affected by our action today, the majority—72 percent—produced graduates who on average earned less than high school dropouts.

In the Department's proposed regulations, career programs would need to meet key requirements to establish that they sufficiently prepare students for gainful employment.

Institutions must certify that all gainful employment programs meet applicable accreditation requirements and state or federal licensure standards.
All gainful employment programs must pass metrics to continue eligibility in the student financial aid program, including: the estimated annual loan payment of typical graduates does not exceed 20 percent of their discretionary earnings or 8 percent of their total earnings and the default rate for former students does exceed 30 percent.
Additionally, institutions must publicly disclose information about the program costs, debt, and performance of their gainful employment programs so that students can make informed decisions.
Background on the need for action and history of reform

Career training programs offer millions of Americans an opportunity to further their education so that they can pursue their dreams of gaining a well-paying job, owning a home, and providing for their family. These values are the cornerstone of the nation's economy and the gateway to the middle class.

For-profit colleges can receive up to 90 percent of their revenue from taxpayer dollars, with the additional revenue frequently coming from veterans' benefits and private student loans.

These students—including veterans—enrolled to become equipped for the workforce, but often they didn't get what they need. Instead, they found confusing or misleading information, excessive costs, poor quality, low completion rates, and programs that provide training for low-wage occupations or, in some cases, where there simply are no jobs.

Widespread concerns prompted the Obama Administration to embark on a multi-year negotiation with the higher education community over new regulations that ensure students are being prepared for gainful employment. Following last year's court decision, which affirmed the U.S. Department of Education's authority to regulate in this area in order to protect students and taxpayers, the Department undertook new efforts to make career training programs affordable pathways to good jobs.

"Success in career education should be measured by how many students graduate prepared for a good job with sufficient earnings," Duncan said. "While state attorneys general across the country and allies like the Consumer Financial Protection Bureau have taken steps in recent months to stop programs from preying on students, we know more can be done at the local, state, and federal level to stop this abuse."

Details of the New proposal to better prepare students for gainful employment

The proposed regulations follow on public hearings the Department held last year. The affected programs include nearly all programs at for-profit institutions, as well as certificate programs at public and private non-profit institutions, such as community colleges.

The Department has proposed a framework with three components: certification requirements, accountability metrics, and public disclosures. The proposal distinguishes programs that provide affordable training that leads to well-paying jobs from those programs that leave students with poor earnings prospects and relatively high amounts of debt, or which lead to high student loan default rates.

While all programs would have an opportunity to improve under the proposed regulations, those with the worst outcomes—high debt-to-earnings rates or high loan default rates—would lose eligibility to participate in federal student aid programs to protect students and taxpayers.

The proposed rule also increases transparency about gainful employment programs by requiring institutions to tell current and potential students about key outcomes, like average debt levels, earnings, loan repayment rates, loan default rates, and completion and withdrawal rates. This information would help students identify programs that may serve them best and help them make more informed decisions about their educational investment.

THE GENGHIS KHAN "WATER REIGN"

FROM:  NATIONAL SCIENCE FOUNDATION 

Climate of Genghis Khan's ancient time extends long shadow over Asia of today
Current drought in Mongolia could have serious consequences
Climate was very much on Genghis Khan's side as he expanded his Mongol Empire across northeastern Asia.

That link between Mongolia's climate and its human history echoes down the centuries, according to findings reported in this week's issue of the journal Proceedings of the National Academy of Sciences (PNAS).

But climate may no longer be the boon it was during the latter, wetter part of Genghis Khan's reign. The early years were marked by drought.

Mongolia's current drought conditions could have serious consequences for the Asia region's human and other inhabitants.

The discovery linking ancient and modern history hinges on wood. Trees provide an extensive climate record in their rings.

The tree rings' tales of ebbs and flows in water availability show that Genghis Khan took power during a severe drought, says Amy Hessl, a geographer at West Virginia University and co-author of the paper.

But, the scientists found, the rapid expansion of Genghis Khan's empire coincided with the wettest period in the region during the last millennium.

"Through a careful analysis of tree-ring records spanning eleven centuries, the researchers have provided valuable information about a period of great significance," says Tom Baerwald, a program director for the National Science Foundation's (NSF) Dynamics of Coupled Natural and Human Systems (CNH) Program, which funded the research.

CNH is one of NSF's Science, Engineering and Education for Sustainability (SEES) programs. CNH is supported by NSF's Directorates for Geosciences; Biological Sciences; and Social, Behavioral & Economic Sciences.

"The results also provide insights into the complex interactions of climate, vegetation and human activity in semi-arid regions today," Baerwald says.

Though political realities would also have played into Genghis Khan's power grab, the regional climate at the time appears to have supported his empire's expansion.

The climate provided literal horsepower as armies and their horses fed off the fertile, rain-fed land.

"Such a strong and unified center would have required a concentration of resources that only higher productivity could have sustained, in a land in which extensive pastoral production does not normally provide surplus resources," the paper states.

While the ramifications for past history are significant, so, too, are they for today's.

The scientists believe that human-caused warming may have exacerbated the current drought in central Mongolia, similar to the drought that coincided with Genghis Khan's initial rise to power.

"If future warming overwhelms increased precipitation, episodic 'heat droughts' and their social, economic and political consequences will likely become more common in Mongolia and Inner Asia," according to the paper.

Hessl co-authored the report with scientists Neil Pederson of the Lamont-Doherty Earth Observatory, Nachin Baatarbileg of the National University of Mongolia, Kevin Anchukaitis of the Woods Hole Oceanographic Institution and Nicola Di Cosmo of the Institute for Advanced Study.

-NSF-
Media Contacts
Cheryl Dybas, NSF

BROTHERS FOUND GUILTY OF INSIDER TRADING

FROM:  SECURITIES AND EXCHANGE COMMISSION 
Jury in Cleveland Finds Brothers Engaged in Insider Trading

The Securities and Exchange Commission has obtained a favorable verdict from a jury in the Northern District of Ohio finding that Andrew W. Jacobs of Lancaster, Pa., and his brother Leslie J. Jacobs II of Cleveland, Ohio, committed insider trading in connection with the December 2009 tender offer for Chattem Inc., a Chattanooga, Tenn.-based distributor of pharmaceutical products.

In its complaint, the SEC alleged that A. Jacobs provided L. Jacobs material nonpublic information about the tender offer and that L. Jacobs then traded on the basis of the information he received from his brother.  A. Jacobs learned of the tender offer in a confidential conversation with his brother-in-law, who at the time was a Chattem executive.  The executive, with whom A. Jacobs had been friends since business school, requested that A. Jacobs keep their discussion confidential, and he agreed to do so.  Nonetheless, the next day, A. Jacobs called his brother L. Jacobs and told him that Chattem was going to be acquired.  A few days later, L. Jacobs purchased 2000 shares of Chattem, and he sold those shares after the public announcement of the acquisition for an illicit profit of $49,457.21.

After a six-day trial, the jury yesterday found in favor of the SEC on the claims under Section 14(e) of the Securities Exchange Act of 1934 and Rule 14e-3 thereunder.  These provisions prohibit insider trading in connection with a tender offer.  The jury found in favor of the defendants on the claims under Sections 10(b) of the Exchange Act and Rule 10b-5 thereunder.

The trial was presided over by U.S. District Judge Solomon Oliver Jr.  The court will now decide what remedies are warranted based on the jury’s verdict.  In its complaint, the SEC sought permanent injunctions, disgorgement with prejudgment interest, and civil monetary penalties pursuant to Section 21A of the Exchange Act.  The SEC also sought an officer and director bar against A. Jacobs, who was a high-level executive of a public company at the time of the tip.  The case was tried by Kristin B. Wilhelm and Joshua A. Mayes of the SEC’s Atlanta Regional Office and Stephan J. Schlegelmilch of the SEC’s headquarters in Washington, D.C.

WORLD ENGAGEMENT BY CONFLICT AND STABILIZATION OPERATIONS

FROM:  U.S. STATE DEPARTMENT 
03/13/2014 07:08 AM EDT
CSO at Two Years: Engaging Around the World
Report
Bureau of Conflict and Stabilization Operations
Washington, DC
March 13, 2014
Breaking Cycles of Violence

The State Department’s Bureau of Conflict and Stabilization Operations (CSO) was created in 2011 to improve the effectiveness and coherence of the U.S. government in conflict situations.

Conflict prevention and crisis response is a vital diplomatic specialty--complementing traditional practices. Focusing on strategically significant countries, CSO believes in taking advantage of the astonishing advances in communications and data gathering and fully realizing the potential of women, young people, and other emerging local leaders. The vast energy generated by expressions of citizen power can move the world toward a brighter tomorrow, if fresh ideas and new alliances steer history toward that promise.

CSO breaks cycles of violence through locally grounded analysis that focuses on a top-priority opportunity to address conflict. When we began, we set three goals:

Make an impact in three or four countries important to the United States.
Build a respected team and trusted partnerships.vellaveve
Be innovative and agile.
By employing tools and expertise to fortify the Department in three areas related to conflict (analysis, strategy, and operations), CSO aims to connect policy and practice. Working with colleagues throughout the State Department and the interagency, CSO strives to forge a common U.S. government understanding of each conflict. The Bureau is now positioned to play a catalytic role as America’s civilian power furthers global peace and prosperity.

Progress in First Four Top-Priority Countries
Kenya is a vital East African ally, and Kenyans and international partners were committed to a peaceful 2013 election. In the previous election season, five years earlier, more than 1,300 people died and 350,000 were displaced. This time Kenyans lost 20 citizens and officials. By mobilizing dozens of apolitical institutions and connecting civil society to the police in new ways, the U.S., its partners, and especially Kenyans, “helped prevent a repeat of the violence we saw five years ago,” Secretary Kerry said.

Bringing the moderate Syrian opposition together and helping them serve the public is a central U.S. objective. Operating from Turkey, CSO has provided opposition activists and local councils with equipment (almost 1,100 recipients), training (more than 1,300 participants), and funding. This assistance has helped Syrians establish 11 independent radio and two TV stations (available to 80 percent of the population), build their resilience under regime and extremist threat, improve their effectiveness and coordination, provide local security, and prepare to serve as democratic leaders and civil administrators. Though the war continues and the regime remains entrenched, many of the opposition councils that we are working with are addressing essential needs.

Honduras has the world’s highest homicide rate, and citizens have lost confidence in their government. CSO has promoted grassroots advocacy and a strategic communications plan to empower civil society groups and encourage government security officials to become more responsive and transparent. Such efforts have helped reduce public fear and shine a light on successful citizen-led efforts to tackle crime. An unprecedented coalition was instrumental in the dismissal of a problematic attorney general and corrupt police, a decline in crime and murder in targeted neighborhoods, and a peaceful election day in November 2013.

In Burma, the challenge is decades of conflict between the government and ethnic minority groups. Creating trust among all Burmese is a priority for U.S. Ambassador Derek Mitchell, and we have helped broaden the constituency for peace, particularly in Kayah State, and strengthen moderate voices in Rakhine State, where animosities between Buddhists and Muslims remain notably high.

Making a Difference in Additional Engagements
In four Central African nations, the United States is determined to end the reign of terror created by Joseph Kony’s Lord’s Resistance Army. Working closely with the host governments and their armed forces, as well as with civil society, the African Union, the UN, the U.S. military, and NGOs, CSO has helped generate significant defections and weaken the LRA. Nigeria, Africa’s most populous country, faces growing violence. As the February 2015 elections approach, the volatile and oil-rich Niger Delta, with its youthful population of 25 million, is a center of concern. With State Department assistance, creative and influential Nigerians have teamed up to mobilize public opinion. Through the dynamic use of an exploding mass media market, they are challenging the narrative that “violence pays” and are promoting non-violent problem-solving between communities and government.

In Bangladesh, home to 180 million people, violence and instability are major problems. The country is struggling to manage a youth bulge, religious-based exclusion, and violent expression with tired political leaders. With the embassy’s guidance, CSO is addressing threats to minority groups.

A new president’s commitment to end the three-decade Casamance conflict in Senegal prompted CSO to deploy a retired ambassador dedicated to helping the government develop and implement a comprehensive peace platform. This has increased public pressure on key actors, spurred negotiations with rebels, enlisted support from the international community, and allowed for safe progress on development projects. A de facto ceasefire has held since late 2012 as negotiations move ahead.

An Emphasis on Analysis, Priorities, and Fast, Adaptable Practice
CSO starts its engagements with joint, rapid, locally-grounded conflict analysis. Data-driven products draw on diverse sources, including diplomatic intelligence and media reports, “big data” platforms, polling, local interviews, and international expertise. Prioritized strategies then target the causes of instability and address high-risk periods such as political transitions and peace negotiations.

Rapid implementation requires host-country partners. CSO seeks to amplify local initiatives by managing nearly $100 million in programs (in FY2013). Working with an embassy, regional bureaus, and others, we use these funds to ground theory in practice.

Real-time monitoring and evaluation enable us to adjust our plans. In Honduras, we saw an important new fiscal initiative get bogged down. In Kenya we should have mobilized already-active religious leaders, youth, civic activists, and police officers earlier. Better anticipation, greater speed, and improved partnership mechanisms are among recurring challenges. So is the need to provide “the right person, in the right place, at the right time,” which is the goal of our new Civilian Response Network.

Finally, communications is central to diplomacy, and CSO is using both traditional media outlets and social media to break cycles of violence in Syria, Honduras, Nigeria, and elsewhere.

In every place CSO works, we count on partners, starting with our colleagues within the State Department and USAID and at the Department of Defense. In Syria, for example, our U.S. partners include the Bureau of Near Eastern Affairs, the Office of Transition Initiatives, the U.S.-Middle East Partnership Initiative, and the Bureau of Democracy, Human Rights and Labor. We rely on allies such as the UK, Denmark, and Canada to support training and other efforts. CSO reaches out to civil society organizations like Sant’Egidio, the Rome-based Catholic lay organization that is at the heart of the campaign to bring a negotiated peace to the Casamance. Host-country partners, such as la Alianza por la Paz y Justicia (Alliance for Peace and Justice) in Honduras, are vital if the initiatives that CSO helps build are to endure. Often, new groups converge to increase their impact, as Champions of Peace did in Kenya.

A Commitment to Improvement
The support our teams have received from more than 20 U.S. ambassadors and their embassies is the best evidence that crisis response and conflict reduction are centerpieces of U.S. diplomacy. Increasingly, colleagues are turning to CSO for assistance in breaking cycles of violence. To build an enduring contributor to U.S. foreign policy, CSO understands that constant learning, close partnerships, and innovation are essential.

FORMER VA PSYCHIATRIST SENTENCED IN MEDICARE FRAUD CASE

FROM:  U.S. JUSTICE DEPARTMENT 
Thursday, March 13, 2014
Former Veterans Affairs Psychiatrist Sentenced for Medicare Fraud

A licensed psychiatrist formerly employed by the Department of Veterans Affairs (VA) was sentenced today to serve 18 months in prison for falsely claiming to provide at-home services to Medicare beneficiaries.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Loretta E. Lynch of the Eastern District of New York and Special Agent in Charge Thomas O’Donnell of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) made the announcement.

Dr. Mikhail L. Presman, 56, of Brooklyn, N.Y., was sentenced by Judge I. Leo Glasser in the Eastern District of New York.   Presman was sentenced to serve three years of supervised release following his prison term and ordered to forfeit $1.2 million and pay restitution to Medicare.

According to court documents, from Jan. 1, 2006, through May 10, 2013, Presman submitted approximately $4 million in Medicare claims for home treatment of Medicare beneficiaries notwithstanding his full-time salaried position as a psychiatrist at the VA hospital in Brooklyn.   Presman did not provide any treatment to a substantial number of the beneficiaries he claimed to have treated.   For example, Presman submitted claims to Medicare for home medical visits at locations within New York City even though he was physically located in China at the time of these purported home visits.   Presman also submitted claims to Medicare for 55 home medical visits to beneficiaries who were hospitalized on the date of the purported visits.
The case was investigated by the HHS-OIG, with assistance from the VA Office of Inspector General, and brought as part of the Medicare Fraud Strike Force, under the supervision of the U.S. Attorney’s Office for the Eastern District of New York and the Criminal Division’s Fraud Section.   The case was prosecuted by Trial Attorney Bryan D. Fields of the Fraud Section and Assistant United States Attorney Patricia E. Notopoulos of the Eastern District of New York.

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 & Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

U.S. DEFENSE DEPARTMENT CONTRACTS FOR MARCH 13, 2014

FROM:  U.S. DEFENSE DEPARTMENT 
CONTRACTS 

NAVY

Exelis Inc., Clifton, N.J., is being awarded a $91,701,414 modification to a previously awarded firm-fixed-price contract (N00019-12-C-0002) to exercise an option for the manufacture and delivery of 42 AN/ALQ-214(V)4 on-board jammer (OBJ) systems.  The AN/ALQ-214(V)4/5 is an OBJ component of the integrated defensive electronic counter measures system.  It is a self-protection radio frequency (RF) countermeasures system used by Navy F/A-18C/D/E/F strike fighter aircraft against RF guided surface-to-air and air-to-air threats (missiles).  Work will be performed in Clifton, N.J. (31 percent); San Jose, Calif. (26 percent); San Diego, Calif. (11 percent); Rancho Cordova, Calif. ( 5 percent);  Mountain View, Calif. (4 percent); Hudson, N.H. (2 percent); West Springfield, Mass.(2 percent); and various locations within the United States (19 percent); and is expected to be completed in November 2016.  Fiscal 2013 and 2014 aircraft procurement, Navy funds in the amount of $91,701,414 are being obligated at time of award, none of which will expire at the end of the current fiscal year.  The Naval Air Systems Command, Patuxent River, Md., is the contracting.

Cardno TEC-Leidos LLC, Charlottesville, Va., is being awarded a maximum $50,000,000 firm-fixed-price, indefinite-delivery/indefinite-quantity architect-engineering contract for range sustainability services for military training range complexes and assets for various locations and environmental planning for National Environmental Policy Act and Executive Order 12114, Environmental Effects Abroad of Major Federal Actions with the preponderance of work involving Navy training range complexes within the Atlantic Fleet area of responsibility (AOR) and may also include work on ranges and installations around the world.  The work to be performed provides services of an interdisciplinary team required to support the Tactical Training Theater Assessment and Planning (TAP) Program.  The TAP program is intended to ensure the sustainability of Navy training ranges and operating areas to support warfighter readiness around the world.  Task order 0001 is being awarded at $10,000 as the minimum guarantee.  All work will be performed at various Navy and Marine Corps facilities and other government facilities within the NAVFAC Atlantic AOR including, but not limited to Virginia (50 percent), California (20 percent), Washington (20 percent), and Arizona (10 percent).  The term of the contract is not to exceed 60 months with an expected completion date of March 2019.  Fiscal 2014 operations and maintenance, Navy contract funds in the amount of $10,000 are obligated on this award and will expire at the end of the current fiscal year.  This contract was competitively procured via the Navy Electronic Commerce Online website, with five proposals received.  The Naval Facilities Engineering Command, Atlantic, Norfolk, Va., is the contracting activity (N62470-14-D-9003).

Lockheed Martin Corp., Baltimore, Md., is being awarded a $22,235,508 modification to previously awarded contract (N00024-11-C-2300) to exercise options for class service efforts and special studies, analyses and reviews for the Littoral Combat Ship (LCS) program.  Lockheed Martin will provide engineering and design services as well as affordability efforts to reduce LCS acquisition and lifecycle costs.  Work will be performed in Hampton, Va. (32 percent); Marinette, Wis. (27 percent); Moorestown, N.J. (22 percent), and Washington, D.C. (19 percent), and is expected to be completed by March 2015.  Fiscal 2013 shipbuilding and conversion, Navy contract funds in the amount of $4,000,000 will be obligated at time of award and will not expire at the end of the current fiscal year.  The Naval Sea Systems Command, Washington, D.C., is the contracting activity.

Honeywell Technology Solutions Inc., Columbia, Md., is being awarded $13,122,763 for time and material task order 0003 under a previously awarded indefinite-delivery/indefinite-quantity contract (M67704-13-D-0020) to support the U.S. Marine Corps, Afghanistan Retrograde and Redeployment Operations/Maintenance/Preservation Packaging and Packing Support.  Work will be performed in Afghanistan, and is expected to be completed March 2015.  Fiscal 2014 operations and maintenance, Marine Corps funds in the amount of $11,024,637 will be obligated at the time of award.  Contract funds in the amount of $6,561,382 will not expire at the end of the current fiscal year.  This contract was competitively procured with 19 proposals solicited via the Marine Corps Logistics Support Services Unrestricted Suite-Task Area 9; with eight offers received.  The Marine Corps Logistics Command, Albany, Ga., is the contracting activity.

Whiting-Turner Contracting Co., Towson, Md., is being awarded a $12,177,926 modification to increase the maximum dollar value of task order 0009 under a previously awarded firm-fixed-price contract (N40080-10-D-0494) for the design, bid-build repairs to building facades (phase 1) and windows (phase 2) for Rickover Hall at the Naval Support Activity, U.S. Naval Academy, Annapolis, Md.  The work to be performed under this modification provides for the replacement of windows and curtain walls, providing temporary facilities and incidental related work.  The contractor shall provide all labor, supervision, materials, equipment, tools, parts, supplies, and transportation to perform all work described in the specifications.  After award of this modification, the total cumulative task order value will be $17,319,816.  Work will be performed in Annapolis, Md., and is expected to be completed by March 17, 2016.  Fiscal 2014 restoration and modernization contract funds in the amount of $12,177,926 are being obligated on this award and will expire at the end of the current fiscal year.  The Naval Facilities Engineering Command, Washington, Washington, D.C., is the contracting activity.

ARMY

Boh Bros. Construction Co., LLC., New Orleans, La., was awarded a $76,267,513 firm-fixed-price contract for the Southeast Louisiana Urban Flood Control Project, Louisiana Avenue Improvements.  Fiscal 2014 other appropriations in the amount of $76,267,513 will be obligated at award. Work is to be performed in New Orleans, La., with an estimated completion date is October 17, 2017.  Bids were solicited via the Web with three bids received.  The U.S. Army Corps of Engineers – New Orleans District, New Orleans, La., is the contracting activity (W912P8-14-C-0022).


BWAY Corp., Atlanta, Ga., was awarded a $47,207,822 fixed-price with economic-price-adjustment contract for M2A2 ammunition containers.  Funding and work performance location will be determined with each order.  Estimated completion date is Sept. 30, 2019.  Bids were solicited via the web with one received.  Army Contracting Command, Rock Island Arsenal, Ill., is the contracting activity (W52P1J-14-D-0006).

Longbow LLC, Orlando, Fla., was awarded a $25,504,554 modification (P00045) to foreign military sales contract W58RGZ-06-C-0134 for initial spares, peculiar ground support equipment, integrated logistics support, management, and production line spares in support of the Royal Saudi Land Forces Aviation Command.  Fiscal 2014 other procurement funds in the amount of $25,504,554 were obligated at the time of the award.  Estimated completion date is June 30, 2016.  Work will be performed in Orlando, Fla.  Army Contracting Command, Redstone Arsenal, Ala., is the contracting activity.

AIR FORCE

L-3 Communications Integrated Systems, Waco, Texas, has been awarded a $38,000,000 modification (P00009) for an existing firm-fixed-price contract (FA8625-13-C-6597) for C-27J spare parts for the Australian military. The contract modification incorporates purchase of non-long-lead critical parts; this is a modification of a pre-existing undefinitized contract action that purchased long-lead spare parts.  The work will be performed at Waco, Texas, and is expected to be completed by March 2015.  This modification relates to 100 percent foreign military sales for Australia.  Air Force Life Cycle Management Center/WLVK, Wright-Patterson Air Force Base, Ohio, is the contracting activity.

Lockheed Martin Global Inc., Orlando, Fla., has been awarded a $24,000,000 indefinite-delivery/indefinite-quantity contract for training and technology transfer in accordance with security assistance agreements and or security cooperation programs as necessary for international C-130J maintenance training requirements for the Iraqi Air Force.  Work will be performed at New Al-Muthana Air Base, Iraq (also known as Baghdad International Airport Complex), and work is expected to be completed by Jan. 31, 2017.  This award is a sole-source award and is 100 percent foreign military sales for Iraq.  338 Security Contracting Squadron, Joint Base San Antonio, Randolph Air Force Base, Texas, is the contracting activity (FA3002-14-D-0004).

DEFENSE LOGISTICS AGENCY

Altitude Technologies, doing business as Chinook Medical Gear Inc.*, Durango, Colo., has been awarded a maximum $28,636,252 modification (P00006) exercising the second option period on a one-year base contract (SPM2D0-12-D-0003) with seven one-year option periods for various medical and surgical products.  This is a fixed-price with economic-price-adjustment, indefinite-delivery/indefinite-quantity contract.  Location of performance is Colorado with an April 3, 2015 performance completion date.  Using military services are Army, Navy, Air Force, Marine Corps and federal civilian agencies.  Type of appropriation is fiscal 2014 war-stopper funds.  The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pa.

CORRECTION:   The contract announced March 4, 2014 to Universal Sodexho had the incorrect modification and length of time on the contract. The correct announcement should read:
Universal Sodexho, Tacoma, Wash., has been awarded a maximum $10,800,000 exercising the sixth modification (P00027) on a three-month bridge contract (SPM500-05-D-BP07) with three one-year option periods for maintenance, repair and operations supplies for the Korea Region. This is a firm-fixed-price, indefinite delivery/indefinite quantity contract. Location of performance is Washington with a June 30, 2014 performance completion date. Using military services are Army, Navy, Air Force and Marine Corps. Type of appropriation is fiscal 2014 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pa.

DEFENSE ADVANCED RESEARCH PROJECTS AGENCY

L-3 Communications Corp., Salt Lake City, Utah, has been awarded a $16,458,470 cost-plus-fixed-fee contract.  The work will support the DARPA mobile hotspots program for phases 2 and 3 (if option is exercised).  If successful, the phase 2 effort is expected to deliver a solution consisting of radio and router pods for mounting on Shadow unmanned aerial vehicles, with all mobile hotspots subsystems wholly contained within the pods.  Work will be performed in Salt Lake City, Utah (73.9%); North Hampton, Mass. (11.7%); Fort Lee, N.J. (4.7%); Malibu, Calif. (3.6%); Nashua, N.H. (1.7%); Guthrie, Okla. (1.8%); Springville, Utah (2.5%).  The estimated completion date is March 12, 2015.  Fiscal 2013 and 2014 research and development funds are being obligated at time of award.  The contracting activity is DARPA, Arlington, Va., (HR0011-14-C-0047).

MISSILE DEFENSE AGENCY

Lockheed Martin Corp., Moorestown, N.J., is being awarded an $8,058,225 modification to previously awarded cost-plus fixed-fee contract (HQ0276-10-C-0003) to provide test support at the Aegis Ashore Missile Defense Test Complex.  As a result of this modification, the total contract value will increase from $301,550,229 to $309,608,454.  The work will be performed at the Pacific Missile Range Facility, Kekaha, Hawaii.  The period of performance is from contract award through Dec. 31, 2015.  Fiscal 2014 research, development, test and evaluation funds will be used to incrementally fund this effort.  The Missile Defense Agency, Dahlgren, Va., is the contracting activity.

*Small Business

DOJ SEEKS RESTRAINING ORDER STOPPING OHIO FROM EXCESSIVE SECLUSION OF BOYS WITH MENTAL HEALTH NEEDS

FROM:  U.S. JUSTICE DEPARTMENT 
Wednesday, March 12, 2014

Justice Department Seeks Temporary Restraining Order to Stop Ohio Department of Youth Services from Excessively Secluding Boys with Mental Health Needs
Today, the Justice Department sought a federal court order temporarily restraining the Ohio Department of Youth Services (DYS) from unlawfully secluding boys with mental health needs in its juvenile correctional facilities.  The requested order would require DYS to abide by safeguards in its use of seclusion until a final ruling on the claims that DYS’ seclusion practices violate the constitutional rights of boys in DYS custody.  In conjunction with its request for a temporary restraining order, the department sought to expand its existing complaint regarding the Scioto Juvenile Correctional Facility, to include claims of unlawful seclusion at all of the DYS facilities.

The department’s request for a restraining order detailed the state’s excessive use of seclusion, including the following information:
·          In the second half of 2013, the state imposed a total of almost 60,000 hours of seclusion on 229 boys with mental health needs;
·          One boy spent 1,964 hours in seclusion over six months; the state gave another boy 21 straight days of seclusion;
·          Ten boys at one facility spent over 10 percent of their time in custody in seclusion;
·          While secluded, several boys were on suicide watch, had suicidal thoughts or hurt themselves.
“The Ohio Department of Youth Services must stop violating the rights of youth in its custody through unlawful seclusion,” said Acting Assistant Attorney General Jocelyn Samuels for the Justice Department’s Civil Rights Division.  “The way in which Ohio uses seclusion to punish youth with mental health needs, victimizes one of the most vulnerable groups in our society.”

“Ohio’s juvenile correctional facilities must comply with the Eighth and 14th Amendments,” said U.S. Attorney Carter Stewart for the Southern District of Ohio.  “We will remain vigilant in protecting the constitutional rights of all our citizens, particularly young people and those with mental illness.”

“The facts in this case reveal a serious disregard for the rights of young people with mental health needs in Ohio’s custody,” said U.S. Attorney Steven M. Dettelbach for the Northern District of Ohio.  “The Ohio Department of Youth Services has a responsibility to ensure the health and safety of these young people, including providing appropriate mental health treatment, so that they can overcome challenging behaviors and return to the community to become successful adults.”

Following an investigation under the Violent Crime Control and Law Enforcement Act of 1994 and the Civil Rights of Institutionalized Persons Act (CRIPA), the Justice Department issued findings in May 2007 detailing significant constitutional deficiencies regarding use of physical force, grievance investigation and processing and use of seclusion.  In June 2008, the department entered into a consent decree with the state to correct these deficiencies at the Scioto Juvenile Correctional Facility.  However, the recent discovery that DYS continued to unlawfully seclude boys with mental health needs at Scioto Juvenile Correctional Facility and had moved boys to other DYS facilities also using unlawful seclusion prompted the department today to seek a temporary restraining order and an order allowing it to add the remaining DYS facilities to its complaint.

This case is being litigated by attorneys from the Special Litigation Section of the Civil Rights Division, the U.S. Attorney’s Office for the Southern District of Ohio and the U.S. Attorney’s Office for the Northern District of Ohio.

DOD CHIEF WORRIES SEQUESTRATION MAY PUT AT RISK U.S ROLE AS GUARANTOR OF GLOBAL SECURITY

FROM:  U.S. DEFENSE DEPARTMENT  
By Jim Garamone
American Forces Press Service

WASHINGTON, March 13, 2014 – If sequestration begins again in fiscal year 2016, the U.S. military will not be able to carry out defense strategy, Defense Secretary Chuck Hagel told the House Appropriations Committee’s defense subcommittee this morning.

A return to sequester would put at risk "America's traditional role as a guarantor of global security, and ultimately our own security," Hagel said.

Events in Europe over the past few weeks underscore the need for American involvement, Hagel said. President Barack Obama's fiscal 2015 defense budget request reflects that reality, he added, and sustains U.S. commitments and leadership at a very defining time.

"I believe this budget has to be far more than a set of numbers or just a list of decisions," the secretary said. "It is a statement of values. It's a statement of priorities. It's a statement of our needs. It's a statement of our responsibilities."
The budget request is realistic, Hagel said, and prepares the military to defend the nation at a time of increasing uncertainty throughout the world.

From the troop side, Hagel discussed compensation reform. The department is committed to providing service members fair compensation, he emphasized, "as well as the training and the tools and the edge they will always need to succeed in battle and return home safely.”

"To meet those obligations under constrained budgets, we need some modest adjustments to the growth in pay and benefits,” the secretary said. “All these savings will be reinvested in training and equipping our troops. And there are no proposals to change retirement in this budget."

The Defense Department will continue to recommend pay increases, Hagel said, but they will not be as substantial as in past years. The department will continue subsidizing off-base housing costs, he added, but not at 100 percent, as it is today. DOD will pay about 95 percent, he said, and it will be phased in over the next several years.

The budget request includes a provision to reduce subsidies for military commissaries. "We are not shutting down commissaries," Hagel explained. "We recommend gradually phasing out some subsidies, but only for domestic commissaries that are not in remote areas."

Finally, the secretary said, the Defense Department recommends simplifying and modernizing the three TRICARE military health plan systems by merging them into one, with modest increases in copays and deductibles for military retirees and family members that encourage them more fully to use the most affordable means of care. "Active duty personnel will still receive care that is entirely free," he said.

STANDING READY TO DEFEND U.S TERRITORY

FROM:  U.S. DEFENSE DEPARTMENT 
Northcom, NORAD Stand Ready to Defend Nation, Commander Says
By Claudette Roulo
American Forces Press Service

WASHINGTON, March 13, 2014 – The Bipartisan Budget Act of 2013 provided an important reprieve by enabling short-term readiness fixes and selected program buybacks of significant importance, the commander of North American Aerospace Defense Command and U.S. Northern Command said today.

But the challenges posed by sequestration and the Budget Control Act remain, Army Gen. Charles H. Jacoby Jr. told members of the Senate Armed Services Committee.

The Defense Department’s ability to plan and decide strategically and find innovative solutions to complex national security challenges is hampered by the budget uncertainty, he said.
“The recent Bipartisan Budget Act only postpones, but does not eliminate, the risks to our future readiness and ability to meet the missions specified in the defense strategic guidance of 2012,” Jacoby said before calling on Congress to find a permanent fix.

The department made a “hard choice” when it implemented the furlough of civilian employees as a cost-cutting measure, the general said. “This decision compromised morale, unsettled families and caused us to break a bond of trust -- one that is absolutely critical to the accomplishment of our mission,” he added.
Equally unsettling, Jacoby said, is that NORAD's ability to execute its primary mission has been subjected to increased risk due to the degradation of Air Force combat readiness.

“With the vigilance and the support of Air Combat Command and the [U.S. Air Forces in Europe], we've been able to sustain our effective day-to-day posture, but that comes at the cost of overall U.S. Air Force readiness, which continues to hover at 50 percent,” the general said.

Threats to national security are becoming more diffuse and less attributable, the general noted. Ultimately, he said, crises elsewhere in the world can rapidly manifest themselves in the United States and make the nation more vulnerable.
“While we stand constant vigil against asymmetric network threat activities, Russian actions in the Ukraine demonstrate that symmetric threats remain,” Jacoby said. “Al-Qaida and transnational criminal networks continue to adapt, and they do so much more quickly than we do.”

To deter and defeat these globally networked threats, the United States must prioritize its support to its partners in the law enforcement community and the international community, the general said.

And, “tangible evidence of North Korean and Iranian ambitions confirms that a limited ballistic missile threat to the homeland has matured from a theoretical to a practical consideration,” he added.

Northcom and NORAD are working with the Missile Defense Agency to address concerns about the potential for proliferation of these lethal technologies, Jacoby said. Together, the three agencies are investing in a “tailored solution to address the challenges that advancing missile technologies impose on our ballistic missile defense system architecture,” he noted.

Northcom and NORAD are working together to address a variety of other challenges, the general said. As seasonal ice decreases, for example, the Arctic is evolving into an increasingly important strategic issue, he told the Senate panel.
“Therefore, we continue to work with our premier Arctic partner, Canada, and other stakeholders to develop our communications domain awareness infrastructure and presence in order to enable safety, security, and defense in the far north,” Jacoby said.

Maintaining an in-depth defense of the nation requires partnerships with neighboring countries, the general said.

“Our futures are inextricably bound together. And this needs to be a good thing in the security context,” he said. “The stronger and safer they are, the stronger our partnerships, the safer we all are collectively. And this creates our common, competitive security advantage for North America.”

Northcom also stands ready to respond to national security events and to support the federal response to man-made or natural disasters, he said.

“Our challenge remains to not be late to need,” the general said. “The men and women of Northcom and NORAD proudly remain vigilant and ready, as we stand watch over North America and adapt to the uncertainty of the global security environment and fiscal realities.”

SEC GETS ASSET FREEZE AGAINST MICROCAP STOCK PROMOTER

FROM:  SECURITIES AND EXCHANGE COMMISSION 

The Securities and Exchange Commission today announced fraud charges and an emergency asset freeze against a promoter behind a platform of affiliated microcap stock promotion websites.

The SEC alleges that John Babikian used AwesomePennyStocks.com and its related site PennyStocksUniverse.com, collectively “APS,” to commit a brand of securities fraud known as “scalping.”  The APS websites disseminated e-mails to approximately 700,000 people shortly after 2:30 p.m. Eastern time on the afternoon of Feb. 23, 2012, and recommended the penny stock America West Resources Inc. (AWSRQ).  What the e-mails failed to disclose among other things was that Babikian held more than 1.4 million shares of America West stock, which he had already positioned and intended to sell immediately through a Swiss bank.  The APS emails immediately triggered massive increases in America West’s share price and trading volume, which Babikian exploited by unloading shares of America West’s stock over the remaining 90 minutes of the trading day for ill-gotten gains of more than $1.9 million.

According to documents filed simultaneously with the SEC’s complaint in federal court in Manhattan, Babikian was actively attempting to liquidate his U.S. assets, which he holds in the names of alter ego front companies.  He was seeking to wire the proceeds offshore.  The Honorable Paul A. Crotty granted the SEC’s emergency request to preserve these assets by issuing an asset freeze order.

“The Enforcement Division, including its Microcap Fraud Task Force, is intensely focused on the scourge of microcap fraud and is aggressively working to root out microcap fraudsters who make their living by preying on unwitting investors,” said Andrew J. Ceresney, Director of the SEC’s Division of Enforcement.

“By obtaining today’s emergency asset freeze, we have thwarted Babikian’s attempts to liquidate and expatriate assets that should be used to return his ill-gotten gains and pay appropriate penalties,” said Stephen L. Cohen, Associate Director of the SEC’s Division of Enforcement in Washington, D.C.

According to the SEC’s complaint, America West’s stock was both low-priced and thinly traded prior to Babikian’s mass dissemination of the APS e-mails promoting it.  America West’s trading volume in 2011 averaged approximately 15,400 shares per day.  There was not a single trade in America West stock on Feb. 23, 2012, before the touting e-mails were sent.  However, in the immediate aftermath of Babikian’s e-mail launch, more than 7.8 million shares of America West stock was traded in the next 90 minutes as America West’s share price hit an all-time high.  Absent the fraudulent touts, Babikian could not have sold more than a few thousand shares at an extremely lower share price.

The court’s order, among other things, freezes Babikian’s assets, temporarily restrains him from further similar misconduct, requires an accounting, prohibits document alteration or destruction, and expedites discovery.  Pursuant to the order, the SEC has taken immediate action to freeze Babikian’s U.S. assets, which include the proceeds of the sale of a fractional interest in an airplane that Babikian had been attempting to have wired to an offshore bank, two homes in the Los Angeles area, and agricultural property in Oregon.

The SEC’s investigation, which is continuing, has been led by Andrew R. McFall, John P. Lucas, Robert W. Nesbitt and supervised by J. Lee Buck II.  The case will be litigated by Matthew P. Cohen and Michael J. Roessner.  The SEC appreciates the assistance of the Quebec Autorité des Marchés Financiers, Financial Industry Regulatory Authority, and OTC Markets Group Inc.