DOJ, eBAY INC., SETTLE "NO POACH" HIRING AGREEMENTS CASE

FROM:  U.S. JUSTICE DEPARTMENT 

Thursday, May 1, 2014

Justice Department Requires eBay to End Anti-competitive “No Poach” Hiring Agreements

Settlement Preserves Competition for High Tech Employees

The Department of Justice announced today that it has reached a settlement with eBay Inc. that prevents the company from entering into or maintaining agreements with other companies restraining employee recruitment and hiring.
         
The department’s Antitrust Division filed the proposed settlement in the U.S. District Court for the Northern District of California in San Jose.   If approved by the court, the settlement would resolve the department’s competitive concerns and the original lawsuit filed on Nov. 16, 2012.

In its lawsuit, the department alleged that senior executives and directors of eBay and Intuit entered into an agreement, beginning no later than 2006, that prevented each firm from recruiting employees from the other and that prohibited eBay from hiring Intuit employees that approached eBay.

In the high technology sector, employees with advanced or specialized skills are highly valued and sought after.   Companies often heavily recruit and hire experienced and capable employees of other technology firms, offering significantly better job opportunities or pay.   The agreement between eBay and Intuit diminished important competition between the firms to attract highly skilled technical and other employees to the detriment of affected employees who had less access to better job opportunities and higher pay.

“eBay’s agreement with Intuit served no purpose but to limit competition between the two firms for employees, distorting the labor market and causing employees to lose opportunities for better jobs and higher pay,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division.   “The proposed settlement resolves the department’s antitrust concerns and ensures that eBay will not engage in similar conduct in the future.”

Previously, in denying eBay’s motion to dismiss the case, the district court found that the agreement alleged by the department, if proven, would constitute a naked horizontal market allocation agreement that was manifestly anticompetitive and lacking in any redeeming virtue, and thus could be found per se unlawful.  

The proposed settlement would prohibit eBay from entering or maintaining anticompetitive agreements relating to employee hiring and retention for five years.   It would broadly prohibit eBay from entering, maintaining or enforcing any agreement that in any way prevents any person from soliciting, cold calling, recruiting, hiring or otherwise competing for employees.   eBay will also implement compliance measures tailored to these practices. Intuit is already subject to a similar consent decree, and for that reason was not a defendant in this case.

Today, the California Attorney General’s Office also filed a settlement in its related case, The People of the State of California v. eBay Inc., based on the same facts alleged in the department’s complaint.
 
This case and the proposed settlement arose out of a series of Antitrust Division investigations into employee recruitment practices at a number of high tech companies.   In September 2010, the Antitrust Division filed a civil antitrust lawsuit against six high tech firms– Adobe Systems Inc., Apple Inc., Google Inc., Intel Corporation, Intuit Inc. and Pixar–for antitrust violations arising from “no cold call” agreements.   In December 2010, the Antitrust Division filed a civil antitrust lawsuit against Lucasfilm Ltd. alleging antitrust violations involving similar activities restraining competition for employees.   In both cases, settlements were filed at the same time the lawsuits were filed resolving the department’s competitive concerns.   Today’s proposed settlement with eBay is substantially the same as the court-approved settlements in the two prior cases.

eBay Inc. is a California corporation with its principal place of business in San Jose.

The proposed settlement, along with the department’s competitive impact statement, will be published in The Federal Register, as required by the Antitrust Procedures and Penalties Act.   Any person may submit written comments concerning the proposed settlement within 60 days of its publication to James J. Tierney, Chief, Networks & Technology Enforcement Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street N.W., Suite 7100, Washington D.C. 20530.   At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.

SEC ANNOUNCES ENFORCEMENT ACTION AGAINST NYSE, AFFILIATES FOR COMPLIANCE FAILURE

FROM:  SECURITIES AND EXCHANGE COMMISSION 

The Securities and Exchange Commission today announced an enforcement action against the New York Stock Exchange and two affiliated exchanges for their failure to comply with the responsibilities of self-regulatory organizations (SROs) to conduct their business operations in accordance with Commission-approved exchange rules and the federal securities laws.  Also charged was the NYSE exchanges’ affiliated routing broker Archipelago Securities.

The NYSE exchanges agreed to settle the SEC’s charges by retaining an independent consultant and together with Archipelago Securities paying a $4.5 million penalty.

“The SEC regulates exchanges, in part, by reviewing rules proposed by the exchanges that govern exchange activities and allow market participants to decide how and where to place orders,” said Andrew J. Ceresney, director of the SEC’s Division of Enforcement.  “We will hold exchanges accountable if they fail to have rules governing their operations or fail to follow them.”

As SROs, the NYSE exchanges are required to conduct their operations in accordance and compliance with their own rules as well as the federal securities laws.  They are required to file all proposed rules and rule changes with the Commission, which publishes them for public comment, before they take effect.  This transparency enables all participants trading on the exchanges to understand how their orders are processed and executed.

According to the SEC’s order instituting settled administrative proceedings, the NYSE exchanges repeatedly engaged in business practices that either violated exchange rules or required a rule when the exchanges had none in effect.  For example, all of the NYSE exchanges used an error account maintained at Archipelago Securities to trade out of securities positions taken on as a result of their operations despite not having rules in effect that permitted them to maintain and use such an account.  In another example, NYSE Arca failed to execute a certain type of limit order under specified market conditions despite having a rule in effect that stated that NYSE Arca would execute such orders.

“The order highlights instances where the exchanges conducted business without a rule in place due to weak or inadequate policies and procedures,” said Antonia Chion, an associate director in the SEC’s Division of Enforcement.  “In other instances, the exchanges did not operate in compliance with their effective rules.  Both failures reflect a troubling lack of compliance with the requirements and obligations imposed on securities exchanges.”

The violations detailed in the SEC’s order occurred during periods of time from 2008 to 2012.  The SEC’s order finds that the NYSE exchanges violated Section 19(b) and 19(g) of the Securities Exchange Act of 1934 through misconduct that included the following:

NYSE, NYSE Arca, and NYSE MKT (formerly NYSE Amex) used an error account maintained at Archipelago Securities to assume and trade out of securities positions without a rule in effect that permitted such trading and in a manner inconsistent with their rules for the routing broker, which limited Archipelago Securities’ activity primarily to outbound and inbound routing of orders on behalf of those exchanges.

NYSE provided co-location services to customers on disparate contractual terms without an exchange rule in effect that permitted and governed the provision of such services on a fair and equitable basis.

NYSE operated a block trading facility (New York Block Exchange) that for a period of time did not function in accordance with the rules submitted by NYSE and approved by the SEC.

NYSE distributed an automated feed of closing order imbalance information to its floor brokers at an earlier time than was specified in NYSE’s rules.
NYSE Arca failed to execute Mid-Point Passive Liquidity Orders (MPLOs) in locked markets (where the bid and ask prices are the same) contrary to its exchange rule in effect at the time.

In addition, the SEC’s order finds that NYSE Arca accepted MPLOs in sub-penny amounts for National Market System stocks trading at over $1.00 per share, in violation of Rule 612(a) of Regulation NMS.

The SEC’s order further finds that Archipelago Securities failed to establish and maintain policies reasonably designed to prevent the misuse of material, nonpublic information in connection with error account trading.  Archipelago Securities also violated and failed to give the SEC timely notice of its violation of the net capital rule – a critical federal securities law provision intended to ensure that brokers and dealers remain solvent and can meet their financial obligations.  

Now wholly-owned subsidiaries of IntercontinentalExchange Inc., NYSE, NYSE Arca, NYSE MKT, and Archipelago Securities have consented to the SEC’s order without admitting or denying the findings.  They agreed to collectively pay the penalty of $4.5 million, and the NYSE exchanges agreed to complete significant undertakings including retaining an independent consultant to complete a comprehensive review of their policies and procedures for determining whether (1) a new business practice or a change to an existing business practice requires the filing with the SEC of a proposed rule or rule change, and (2) business practices requiring an exchange rule are conducted pursuant to and in accordance with an effective exchange rule.

The SEC’s investigation was conducted by Jason Litow, Vinyard Cooke, and Kevin Gershfeld.  The case was supervised by Yuri Zelinsky and Antonia Chion.

REMARKS: SECRETARY KERRY, AFRICAN FOREIGN MINISTERS MAKE REMARKS ON SOUTH SUDAN

FROM:  U.S. DEFENSE DEPARTMENT 

Remarks With Ethiopian Foreign Minister Tedros Adhanom, Kenyan Foreign Minister Amina Chawahir Mohamed, And Ugandan Foreign Minister Sam Kutesa After Their Meeting

Remarks

John Kerry

Secretary of State

Ethiopian Ministry of Foreign Affairs

Addis Ababa, Ethiopia

May 1, 2014

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SECRETARY KERRY: Thank you, folks. We just had a very positive meeting, laid out a strong agenda which we all agreed on which we’ll talk about later in the day when we have a little more time. But I think it’s clear that everybody is in agreement the killing must stop; that humanitarian access needs to be delivered; most importantly, a legitimate force that has an ability to help make peace needs to get on the ground as rapidly as possible. And we agreed on both the terms and timing and manner and size, and we need to go to work to make sure that happens. I think that’s a quick summary.

FOREIGN MINISTER TEDROS: Thank you.

SECRETARY KERRY: Anybody else?

FOREIGN MINISTER TEDROS: Thank you. I think I agree with him. One thing that we have stressed is the deployment – as Secretary Kerry said, the deployment of the force as soon as possible. And I think with that, many of the other interests can be addressed. And I would like to use this opportunity, actually, on behalf of my colleagues and myself to thank Secretary Kerry, who is here today with us. But since the crisis started, he has been in contact regularly, frequent phone calls and good support, and we hope that support will continue, especially from him and the U.S. Government, and we really appreciate the support.

SECRETARY KERRY: Thank you.

FOREIGN MINISTER TEDROS: But there is an agreement now that we have to really be as aggressive as possible in order to have an impact on the ground in South Sudan, in order to (inaudible). Thank you.

SECRETARY KERRY: Thank you, Tedros.

FOREIGN MINISTER TEDROS: Merci.

SECRETARY KERRY: Thank you.

FOREIGN MINISTER TEDROS: Thank you. Thank you.

SECRETARY KERRY: Sam, thank you.

NATIONAL GUARD PROVIDES HELP AFTER TORNADO DAMAGE IN MISSISSIPPI

FROM:  U.S. DEFENSE DEPARTMENT 

GUARDSMEN PROVIDE RELIEF TO MISSISSIPPI RESIDENTS AFTER TORNADOES

An aerial view shows tornado damage to houses in Tupelo, Miss., April 28, 2014. Mississippi National Guard photo by U.S. Army Staff Sgt. Jessica McCormick.

An aerial view shows tornado damage to a home in Louisville, Miss., April 29, 2014, where about 50 Mississippi Guardsmen responded to help. Mississippi National Guard photo by U.S. Army Maj. Andy Thaggard.

UNLICENSED DOCTOR, OTHERS CONVICTED IN $14.9 MILLION MEDICARE FRAUD

FROM:  U.S. JUSTICE DEPARTMENT 

Wednesday, April 30, 2014

Detroit-Area Physical Therapist, Physical Therapy Assistant and Unlicensed Doctor Convicted in $14.9 Million Medicare Fraud Scheme

A federal jury in Detroit today convicted a physical therapist, physical therapy assistant and unlicensed doctor for their participation in a nearly $15 million Medicare fraud scheme.

Acting Assistant Attorney General David A. O’Neil of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Paul M. Abbate of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the Detroit Office of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Office of Investigations made the announcement.

Shahzad Mirza, 43, a physical therapist; Jigar Patel, 30, a physical therapy assistant; and Srinivas Reddy, 38, a foreign medical school graduate without a license to practice medicine were each found guilty of one count of conspiracy to commit health care fraud in connection with a scheme perpetrated from approximately July 2008 through September 2011 at Detroit area companies Physicians Choice Home Health Care LLC (Physicians Choice), Quantum Home Care Inc. (Quantum), First Care Home Health Care LLC (First Care), Moonlite Home Care Inc. (Moonlite) and Phoenix Visiting Physicians.  In addition, Mirza and Patel were each found guilty of two counts of health care fraud in connection with the submission of false claims to Medicare for home health services, and Reddy was found guilty of three counts of health care fraud in connection with the submission of false claims to Medicare for home health services and physician home visits.  Patel was found guilty of one count of money laundering in connection with his laundering of the proceeds of the fraud through his company MI Healthcare Staffing.

The defendants were charged in a superseding indictment returned Feb. 6, 2012.  Three other individuals charged in the indictment remain fugitives.

According to evidence presented at trial, Physicians Choice, Quantum, First Care and Moonlite operated a fraudulent scheme to bill Medicare for home health care services that were never provided.  The home health care companies paid kickbacks to recruiters who in turn paid Medicare beneficiaries cash and promised them access to narcotic prescriptions.  The conspirators created the company Phoenix Visiting Physicians, which employed unlicensed individuals, including Reddy, to visit patients and provide them with narcotic prescriptions as well as obtain the information necessary to fill out paperwork to refer them for medically unnecessary home health care services.

Evidence presented at trial showed that beneficiaries pre-signed medical paperwork that was provided to Patel and other physical therapist assistants to fill in with false information purporting to show that the care was provided, when it was not.  Patel, registered physical therapist Mirza and others would sign this paperwork as though they had provided services.  In the course of the conspiracy, Patel incorporated his own staffing company, MI Healthcare Staffing, through which he laundered proceeds of the fraud from home health care companies and a shell company owned and operated by his co-conspirators.

Physicians Choice and the related companies were paid nearly $15 million in the course of the conspiracy.

Sentencing for all three defendants has not yet been scheduled.

The investigation was led by the FBI and HHS-OIG, and was brought by the Medicare Fraud Strike Force, a joint effort of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.  The case was prosecuted by Assistant Chief Catherine K. Dick and Trial Attorneys Matthew C. Thuesen and Rohan A. Virginkar 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.

ASSISTANT SECRETARY BROWNFIELD'S REMARKS AT WILDLIFE CRIMINOLOGY SYMPOSIUM

FROM:   U.S. STATE DEPARTMENT 

Remarks at the Wildlife Criminology Symposium

Remarks

William R. Brownfield

Assistant Secretary, Bureau of International Narcotics and Law Enforcement Affairs

World Bank,

Washington, DC

April 23, 2014

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Thank you very much, Mr. Magrath and Mr. McCarthy. Ladies and gentlemen, I would like to open with my own personal note of thanks, not just to the two gentlemen seated up here with me, but to the entire World Bank. I say this with sincerity. The World Bank has done excellent work in managing, leading, and in many ways, pioneering the effort worldwide to address the crisis of illegal wildlife trafficking. I have this on the best authority on the entire planet – the United States Ambassador to Thailand, a woman to whom I have the unmitigated pleasure of being married for the past 30 years -- and her assessment this morning is that no organization has been more active and more effective in this effort in South East Asia than the World Bank.
Ladies and gentlemen, you may be asking yourselves the question, “What is Mr. Brownfield, a man who is known in the State Department as Mr. Drugs and Thugs, doing here to discuss the issue of international wildlife conservation, protection, and preservation?” My message for all of you is that I am here because there is a very important connection between what I do and what those in the conservation community do. We are talking about two communities that for the past 100, 1000, or 5000 years have not actually worked together a great deal. The conservation community is comprised of men and women who have done extraordinarily effective and noble work in protecting and preserving not dozens, not scores, but hundreds of species of life on our planet that would otherwise be as extinct today as the dinosaurs. To them, we all owe a tremendous debt of gratitude. On the other hand, there is the law enforcement community -- a community that while not traditionally dedicated to the conservation and preservation of species, is very dedicated and quite talented at the process by which we combat and eventually defeat criminal trafficking organizations. Our challenge, ladies and gentlemen – and what I submit to you is the unspoken theme of this symposium - is how to make these two communities work effectively together. That is our challenge for the 21^st century.

I know why I am doing this. I am doing this because two and a half years ago a woman looked at me with very firm eyes and said to me, “Brownfield, you are going to do counter-wildlife trafficking, whether you like it or not.” Her name was Hillary Rodham Clinton and I did what you would expect any Assistant Secretary of State to do under those circumstances -- I said ‘yes Ma’am, I will get right on it.’ And if any of you are wondering whether her departure and the arrival of her successor generated any change in this regard, may I offer you a personal anecdote? The only conversation that I have had with John Kerry that was, shall I say, “pointed,” over the last 14 months has been about how fast I was moving in order to make progress on the issue of wildlife trafficking. So that is why I am here.

Why are you here? I offer the following suggestions. One, you are here because if you did not come or did not focus on this issue, hundreds of species of our planet would be dead, eliminated forever, before this century is out. And second, law enforcers are now dealing with a criminal enterprise that is generating perhaps as much as $10 billion in criminal proceeds every year. Ten billion, ladies and gentlemen, that begins to be real money. You might actually want to begin to pay attention to an enterprise that is moving in an illegal and illicit manner, corrupting institutions and governments to the tune of $10 billion a year.

Ladies and gentlemen, I, like Mr. McCarthy, do not claim to be an expert on wildlife conservation or even on wildlife trafficking. I do think I know something about trafficking in general, and I know that there are certain elements common to each and every one of the trafficking industries. Whether it is cocaine and heroin, firearms, people, cut flowers, or wildlife, I know that first, in every case; there is a demand for the product, which produces a market. In every case, there will be a producer at the source region. Perhaps that producer is growing the product. Perhaps that producer is manufacturing the product. Perhaps that producer is butchering the product in order to traffic it. I know that every trafficking organization develops a logistics network – normally an extremely sophisticated logistics network, because it must move a product from one country across numerous national borders to get to the final market, and it must do so in an illicit manner. Every trafficked product eventually has a retail marketing system at the country of destination. And finally every trafficking network has a financial system that permits those involved in the enterprise eventually to convert their product into some form of cash or other marketable commodity that they can use in the open and licit market. This, law enforcers, is the challenge that we confront as we move down the road toward combatting illegal wildlife trafficking; while every product is different, there are not that many differences between how we will attack this problem and how we attack the problem of drugs or trafficking in persons or trafficking in firearms.

From the law enforcement perspective, we are not at a bad starting point. We do have international conventions, foremost among them CITES, but others as well, that give us the international authority or basis to cooperate and attack this problem. We have certain existing international organizations which have taken on this responsibility, such as Interpol and its regional subgroups, the United Nations Office on Drugs and Crime, the World Customs Organization, even ICCWC, as Leonard laid out. These international organizations or groupings give us natural allies and umbrellas beneath which we can operate. We have regional organizations that have taken on the mission: the OECD, APEC for the Pacific nations, ASEAN specifically for Southeast Asia, and the UN Crime Commission. We are not starting at point zero. Man has walked this path before us and we can take advantage of some of the institutions, the infrastructure, and the architecture that has already been built for us.
For those of us who are from the United States of America, and specifically the United States Government, we have a new weapon as of February of this year, when the President’s new National Strategy for Combatting Wildlife Trafficking came online. This Strategy is easily available online to anyone who may choose to access it.

The President’s National Strategy offers three areas of focus: first, strengthening enforcement of laws and regulations. That, ladies and gentlemen, is what I do for a living. I support law enforcement around the world.

Second, reducing demand for illegally trafficked wildlife. That, to a very considerable extent, is what the conservation community does for a living. However, I do predict that demand will drop rather substantially if, for instance, we tell most individuals that they could be sent to prison for 20 years for buying a rhino horn. I predict that the demand for rhino horn just might diminish a little bit as a result of law enforcement efforts.

The third area laid out in this strategy is building greater international and domestic cooperation. And, that is what both the conservation and the law enforcement communities do.
Now, despite the fact that I am widely referred to in the State Department as “drugs and thugs,” I am actually the Assistant Secretary for International Narcotics and Law Enforcement Affairs, or INL. We have $15 million that we are putting to wildlife trafficking in 2014. And, without going into detail, I am going to divide it into two basic categories. One, we are processing roughly $5 million through some of these international organizations that I just laid out for you. They have already developed programs that are transnational in scope and address the wildlife trafficking issue in an entire region. They need support, they need funds, they need resources. We are trying to provide some of that for them.

The remaining $10 million or so is going into programs with individual countries and governments. This is heavily focused at this time on Africa, and we will have cooperative and close programs with the Governments of Kenya and the Republic of South Africa. Some of the $10 million will be available for other regional programs and cooperation in southern Africa.
We have organized our work on this issue around four basic categories. The first is what we call “legislative framework.” The principle behind this is amazingly simple: it is very difficult to prosecute someone for wildlife trafficking if there is no law on the books that makes it a criminal offense. Judges get annoyed when prosecutors bring cases before them and the prosecutors cannot explain what law has been violated by the defendant. And, believe it or not, in many countries and regions around the world, there are not existing statutes on the books criminalizing this sort of activity or, in some cases; it is criminalized to such a minimal extent that it becomes the equivalent of a traffic offense or a failure to pay parking tickets. Creating the legislative framework must be the first plank in a successful strategy of combatting wildlife trafficking.

Our second organizational concept is support for law enforcement. In the United States of America, this is largely a ranger’s function, though not exclusively. The more we get into prosecutions, the more state and local law enforcement will become engaged, but trying to stop poachers and traffickers at the point of infraction is an expanded ranger function. By expanded, I mean that what these poor guys have to deal with are groups of people armed to the level of an infantry platoon – that degree of firepower. The prospect of coming in and enforcing the law with a nightstick and possibly a 9mm pistol puts local law enforcement in an extraordinarily difficult position. They need training, they need equipment, and in some instances, they need weaponry. That must be part of our challenge.

Our third organizational category includes prosecutors and courts. As you can well imagine, if we have identified them, arrested them, and brought them to court, but a prosecutor has no experience whatsoever on how to prosecute this particular type of crime, then we are not likely to have success. There is nothing that will kill a strategy and a policy more quickly than two or three losing cases that send the message out to everyone in the trafficking industry that “they can’t touch us even if they get us to court.”

Our fourth organizational category is cross-border cooperation. We do it through something we call wildlife enforcement networks – WENS. The principle behind this initiative is extremely simple. It is that governments that are neighbors or at least in the same region as each other stand to benefit from sharing intelligence and information and notifying each other about trafficking groups that seem to be moving across frontiers and borders. At times, regional partners might even plan and cooperate on joint operations and efforts. I can assure you that sophisticated wildlife trafficking organizations know exactly where the borders are located and know precisely how to take advantage of the border if country or government X is enforcing and government Y is not enforcing.

That is the plan. Has there been an impact? I would suggest that there has been. Let me offer three examples from the INL anti-wildlife trafficking initiative. First, recently, 28 governments and their law enforcement communities cooperated for one month in an exercise called COBRA II. This involved law enforcement communities and organizations from Asia, Africa, and North America. What did they accomplish in one month? More than 400 arrests and 350 seizures of illegally trafficked wildlife - and they learned in that month how to do it. They learned lessons from other law enforcement organizations as to what worked and what did not work. They also learned how to communicate with one another and learned new tactics, techniques, and technologies.

Second, in April 2013, the United Nations Crime Commission met and - with the eventual sponsorship of 20 different governments - passed a resolution that stated that wildlife trafficking is a “serious crime” in the United Nations system. Now, ladies and gentlemen, in UN speak, that is about as tough as you can get. They have given the tool and the weapon to any government that is prepared to take on the challenge, by saying the United Nations system and the world’s global community says that this act is a serious crime.

Third and finally, in November of last year, the government for which I work issued its first ever reward offer of the Transnational Organized Crime Rewards Program. Under the authority created by the President of the United States and supporting our Transnational Organized Crime Strategy, this reward program was designed to fill the gap between counterterrorism on one side and counternarcotics on the other side by creating the authority to offer rewards for the most serious participants in transnational organized crime. Who was the very first named suspected criminal under this authority? Ladies and gentleman, it was the organization known as the Xaysavang Network, under the leadership, we believe, of Mr. Keosavang, a citizen of Laos. We believe this organization is perhaps one of the world’s largest wildlife trafficking organizations. They traffic product from Asia and Africa in search of markets around the world.
We have offered $1 million to anyone who assists in taking down this trafficking network. It is symbolic, I acknowledge, but it is important symbolism to say that at the first opportunity we had to identify a transnational criminal organization and to put real money behind its dismantlement, we selected a wildlife trafficking organization. May I say to anyone in the Xaysavang network who may be listening today or in the future that this reward offer still stands. There is no rock beneath which you can hide; no tree behind which you may conceal yourself that will make that $1 million go away.

Ladies and gentlemen, may I mention one other program? I believe there are some academics in this room and I would like to draw you in to this conversation as well. There is a program that the State Department has been managing for several years. It’s kind of a cool program that we call the Diplomacy Lab. It works on the following concept. Neither the Department of State nor any other foreign ministry in the world has so many resources, so many people, so much money that it can do all of the research and analysis that it requires with its own employees. We want to draw in the academic world to this effort. We want to allow them the opportunity, whether they are undergraduate or graduate students or tenured professors, to do research and work that will have a direct, real-world impact on what we are doing. We identify areas and invite research and analysis in those areas. We had excellent success with this in areas related to my line of work, including corrections, prison management, community policing, and tribal courts. There have been a half-dozen of these sorts of research efforts which we absorb in the INL bureau, integrate into our programs and then attempt to apply in genuine programs in many countries around the world. May I suggest to you, academics, to look to the year 2014 for the opportunity to engage in several of these projects and programs that are related to illicit wildlife trafficking?

The problem of wildlife trafficking is not going to be solved today or even this year. It has taken us centuries and perhaps even millennia to get into this problem. It is going to take us some years as a human race to solve it. Yet we will solve the problem, step by step. We will do it together as two communities: a community that is dedicated to conservation and preservation and a community that is dedicated to the enforcement of our nations’ and our planet’s laws. We will do it because we can. We will do it because we must.

Leonard mentioned in his remarks the sound of a lioness mourning the loss of its cub. I come from the west Texas panhandle. I can assure you that I have never heard that sound. I hope I never do. But there is one sound of a mother mourning that, I suggest to you, I would not mind hearing at all. That would be the sound of a homo sapien mourning the departure of her poacher son as he begins several years of incarceration following his conviction and sentencing for wildlife trafficking. That is a vision that I would not mind associating myself with, because the more of that sort of mourning we hear, the less mourning we will hear from lionesses who have lost their cubs. Someday, if we do our jobs right and well, perhaps we’ll hear neither of those two sorts of mourning. Neither the lioness nor the elephant nor the rhino mother, mourning the loss of its young, nor the homo sapien mother mourning the departure of her poacher son. When that day comes, we will have succeeded.

I thank you very much; I look forward to further discussion.

FTC TESTIFIES BEFORE SENATE COMMITTEE REGARDING PRECIOUS METALS INVESTMENT SCAMS

FROM:  FEDERAL TRADE COMMISSION 

FTC Testifies on Precious Metals Investment Scams Before Senate Special Committee on Aging

In testimony before Congress, the Federal Trade Commission described its efforts to stop precious metals investment scams and inform consumers how to avoid them.

Testifying on behalf of the Commission before the Senate Special Committee on Aging, Dama Brown, Director of the FTC’s Southwest Region, said the agency is committed to protecting consumers from investment schemes that swindle money from people and often prey on older Americans’ concerns about the security of their retirement savings, particularly during periods of economic uncertainty.

Following the economic downturn in 2008, the testimony states, the FTC observed a proliferation of schemes that targeted financially-distressed consumers, including telemarketers offering precious metals as purported high-profit, low-risk investments. FTC cases have alleged that, to lure consumers into purchasing these investments, telemarketers claimed that the precious metals investments were certain to rise in price and the investments were safe because they were backed by physical metal.

According to the Commission, in reality, the telemarketers offered a highly leveraged, high-risk investment. Telemarketers allegedly failed to disclose that consumers were financing most of the investments’ purchase price and they were required to pay hefty fees. The terms of the investments rendered them highly risky and largely unprofitable.

The Commission recently filed three law enforcement actions involving precious metals investment schemes, the testimony states. In addition to stopping the alleged scams, the Commission expects to return approximately $5 million to consumer victims. The testimony describes the schemes, the agency’s law enforcement actions, and its consumer education efforts, including providing information about how to avoid scams, what to know before investing in precious metals, coins, or other investments, and practical investment advice.

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

For information about investing in precious metals, read Investing in Gold, Investing in Bullion and Bullion Coins, and Investing in Collectible Coins.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them.

SWISS TAX EVASION ENABLER PLEADS GUILTY

FROM:  U.S. JUSTICE DEPARTMENT 

Wednesday, April 30, 2014

Swiss Offshore Tax Evasion Enabler Pleads Guilty

Josef Dörig, 72, of Switzerland, pleaded guilty today to conspiring to defraud the Internal Revenue Service (IRS) in connection with his work as the owner of a trust company in Switzerland.  Deputy Attorney General James Cole, Assistant Attorney General Kathryn Keneally for the Justice Department’s Tax Division, 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.  Dörig was charged in a one count superseding indictment on July 21, 2011.  Sentencing is set for Aug. 8, 2014, and Dörig faces a statutory maximum sentence of five years in prison.

“Today’s plea further pulls back the curtain on efforts by Swiss banks to help U.S. taxpayers evade taxes through the use of sham trusts and foundations,” said Deputy Attorney General Cole.  “Rest assured, the days of bank secrecy for U.S. tax cheats in Switzerland – and around the world – are numbered.”

“This plea sends a strong message to those who use or help others use offshore bank accounts to evade U.S. taxes,” said Assistant Attorney General Keneally.  “We are receiving information from a variety of sources and are committed to investigating and prosecuting this wrongdoing.”

“We will continue to investigate and prosecute banks and individuals who assist U.S. citizens in the evasion of income taxes with overseas accounts,” said U.S. Attorney Boente.  “The doors are quickly closing on this illegal activity.”

“Assisting American taxpayers to evade their tax obligations with the use of secret bank accounts held in sham entities violates the law, and we will find those who are doing it,” said Chief of IRS-Criminal Investigation Richard Weber.  “IRS-CI will pursue those who use anonymous offshore accounts to avoid paying their fair share.  IRS Criminal Investigation is proud to have shared our hallmark expertise in following the money trail in this and other increasingly sophisticated criminal schemes.”

In a statement of facts filed with the plea agreement, Dörig admitted that between 1997 and 2011, while owning and operating a trust company, 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 bank accounts held in the names of sham entities at a financial institution referred to in the superseding indictment as International Bank (IB), one of the biggest banks in Switzerland and one of the largest wealth managers in the world.

According to the statement of facts, from 1972 to 1996, Dörig worked for a subsidiary of IB.  The subsidiary formed, managed and maintained nominee tax haven entities.  Individuals concealed their assets by holding their accounts at IB in the names of these tax haven entities.  During this time, the subsidiary managed and maintained over 100 sham entities for U.S. taxpayers committing tax evasion.

Also included in the statement of facts, in 1997, executives at the subsidiary devised a plan to spin off all of these sham entities into a new trust company, Dörig Partner AG, to be owned and operated by Dörig, who was then an employee of the subsidiary.  Dörig was required to make his best efforts to keep the existing accounts at IB open and to ensure that any clients referred to him by IB would open new accounts at that institution.

According to the statement of facts, IB promoted Dörig Partner as a provider of various entity structures.  The phone list used in IB’s New York representative office identified Dörig Partner as an external trust expert.  Dörig Partner also sublet space from IB in an office tower where a private bank owned by IB was the major tenant.

As part of the conspiracy, Dörig traveled to the United States to introduce himself to new clients he had obtained as part of the spin-off.  In the following years, he traveled to the United States with bankers from IB, including his co-defendants Markus Walder, Marco Parenti-Adami and Michele Bergantino, to meet with existing and prospective clients who already had undeclared accounts at IB but had been identified by the IB’s bankers as potential candidates for the use of a structure.

According to the statement of facts, although Dörig ostensibly controlled both the structure and the account at IB, in practice, many of the U.S. taxpayers with undeclared accounts controlled the assets in those accounts by dealing directly with IB bankers, often without either the knowledge or consent of Dörig.

According to the statement of facts, in 2008, IB ordered Dörig Partner to close accounts for the structures they managed.  Dörig turned to an asset manager at a financial services firm in Zurich for assistance.  The financial services firm maintained a master account in its own name at a private bank in Gibraltar, and then opened sub-accounts for Dörig’s clients at that bank to which Dörig transferred the funds from the clients’ undeclared accounts at IB.  The financial services firm provided the Gibraltar bank only with the number associated with each sub-account and did not inform the bank of any information regarding the owners of the assets in the sub-accounts.

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

DOD REPORT TO CONGRESS STRESSES PROGRESS BY AFGHAN SECURITY FORCES

FROM:  U.S. DEFENSE DEPARTMENT 

Report Points to Afghan Progress, Challenges

By Jim Garamone

American Forces Press Service

WASHINGTON, April 30, 2014 – While Afghan security forces did an outstanding job protecting their people during the April election, they are not yet ready to shoulder the burden alone, according to the Defense Department’s congressionally mandated semiannual Report on Security and Stability in Afghanistan.

The report, released to Congress today, said Afghan forces grew in numbers and capabilities over the reporting period that ended March 31, and held their own against the insurgency.

Disrupting the April 5 election was an insurgent goal, yet their “territorial and kinetic capabilities remained static,” according to the report.

The election was a test of Afghan forces and the electoral process, and all reports indicate they did well. “The [Afghan national security forces] and Afghan election institutions laid the groundwork for a successful election, registering millions of voters and securing thousands of polling sites, with minimal international assistance,” the report said. “These preparations far surpassed Afghanistan’s efforts in the 2009 and 2010 elections.”

Afghan forces defended the election sites and prevented high-profile attacks across the country. Voter turnout was high.

The election is just one example of the real progress Afghanistan has made, the report says, noting that the government maintains control of the cities and all provincial capitals. Insurgent attacks are away from these centers. Polling data shows most Afghans view the security forces favorably. Afghan forces now conduct almost all operations independently.

American and coalition casualties are a quarter of what they were in 2010, the report says, and violence indicators are down from a year ago. These include a 2 percent drop in enemy-initiated attacks, an 8 percent drop in complex attacks and a 24 percent drop in improvised explosive device events.

Still, there are challenges. Logistics and sustainment capabilities lag well behind the operational progress. “Afghan National Army attrition was higher than its target, and corruption continued,” the report says. “Although the International Security Assistance Force continues to develop capabilities, [Afghan forces require] more time and effort to close four key high-end capability gaps that will remain after the ISAF mission ends on December 31, 2014: air support; intelligence enterprise; special operations; and Afghan security ministry capacity.”
International funding and coalition force assistance will be critical to sustaining the force after 2014, the report says. If a second-round runoff election is required -- and indications today are that it will be -- securing the runoff during the summer fighting season will test Afghan forces.

But uncertainties dog signs of progress. Afghan President Hamid Karzai’s refusal to sign the already negotiated bilateral security agreement with the United States means uncertainty for what follows the end of the International Security Assistance Force mission. No coalition country can forecast their post-2014 presence. The Taliban are trying to capitalize on the absence of an agreement to instill fear among Afghans.

While NATO planning has been for a post-2014 force to train and advise with 8,000 to 12,000 troops, President Barack Obama has not yet made any decision on the number of U.S. troops that may be kept in Afghanistan if the Afghan government signs the agreement.

Part of this effort is because of the lack of logistics expertise. From the ministries down to the tactical level, Afghanistan’s national government faced a major challenge in developing an effective, integrated logistics and sustainment system for the Afghan forces, the report says, adding that a lack of trained maintenance technicians, combined with a logistics system that struggled to resupply units in the field, adversely affected every component of Afghanistan’s security forces. Afghan forces relied on coalition forces for limited enabler support, particularly in the areas of close-air support, casualty evacuation, logistics, counter-IED, and intelligence, surveillance, and reconnaissance.

Problems in the government mean Afghanistan cannot capitalize on security gains. “Challenges in governance and sustainable economic development slowed the reinforcement and consolidation of security gains,” the report says. “Ongoing insurgent activity and influence inhibited economic development and improvements in governance. Predatory corruption, criminal patronage, weak rule of law, and reliance on the funding for the insurgency from narco-trafficking are factors which hindered the ability of the [Afghan forces and the national government’s local] governance structures to maintain a secure environment and provide essential service delivery.”

Immature infrastructure exacerbates these problems, the report adds.

THOMAS COUNTRYMAN'S REMARKS ON NUCLEAR WEAPONS RENUNCIATION BY UKRAINE

FROM:  U.S. STATE DEPARTMENT 

Twenty Years of Renunciation From Nuclear Weapons by Ukraine: Lessons Learned and Prospects of Nuclear Disarmament"

Remarks

Thomas M. Countryman

Assistant Secretary, Bureau of International Security and Nonproliferation

The Permanent Mission of Ukraine to the United Nations

New York City

April 28, 2014

---

Introduction
The 2014 PrepCom is an opportunity to strengthen the Nuclear Nonproliferation Treaty and to reinforce our shared responsibilities to uphold it. The United States remains committed to full implementation of the 2010 Review Conference Action Plan. Through this PrepCom we will build on the momentum of the successful 2010 Review Conference and PrepComs in 2012 and 2013. As we approach the 2015 NPT Review Conference, the United States looks to all States Parties to work together towards strengthening this critical treaty which has underpinned international security for nearly 45 years.

I thank our Ukrainian friends for hosting us today. As President Obama and Secretary Kerry have said, the United States strongly supports the sovereignty and territorial integrity of Ukraine. Last week, Vice President Biden traveled to Kyiv in order to demonstrate our solidarity with the Ukrainian people. He discussed how the United States is supporting the international community’s efforts to stabilize and strengthen Ukraine’s economy and assist Ukraine in political reform and uniting the country. The Vice President announced a U.S. package of assistance totaling $50 million to help Ukraine pursue political and economic reform and strengthen our partnership. He made clear that Ukraine has a difficult road ahead, but it will not walk this road alone. And today the United States announced that it will impose new targeted sanctions on a number of Russian individuals and entities and restricting licenses for certain U.S. exports to Russia.

Budapest Memorandum Commitments

In the 1994 Budapest Memorandum, the United States, Russia, and the United Kingdom made a commitment to respect the independence, sovereignty, and existing borders of Ukraine. The United States government remains committed to the Budapest Memorandum.
Our partnership with Ukraine goes back many years, and is particularly strong in the area of nonproliferation. We appreciate Ukraine’s continued leadership in this area.

Ukraine’s Nonproliferation Record

This year marks the twentieth anniversary of Ukraine’s historic decision to remove the third largest stockpile of nuclear weapons in the world from its territory and to accede to the Nuclear Nonproliferation Treaty as a non-nuclear-weapon state. Ukraine’s unwavering commitment to its obligations under the NPT demonstrates that when a country places itself squarely within the NPT and diligently adheres to all of the Treaty’s obligations, all nations benefit.
Since 1994, Ukraine has a strong record of supporting nuclear nonproliferation and threat reduction. With support from the “Nunn-Lugar” Cooperative Threat Reduction program, Ukraine dismantled an enormous stockpile of ICBMs, heavy bombers, and related delivery systems. In 2004, it began an augmented program with the U.S. Department of Defense that includes weapons of mass destruction proliferation prevention and border security initiatives. By hosting the multilateral Science and Technology Center in Ukraine (STCU), Ukraine has engaged over 20,000 scientists from the former Soviet weapons program in peaceful activities. The United States has been proud to be a partner in those efforts.

Ukraine brought its IAEA safeguards agreement into force in 1995; it signed the Additional Protocol in 2000 and brought it into force in 2006. Ukraine joined the Global Partnership against the spread of WMD in 2005, in 2007 it was one of the first countries to join the Global Initiative to Combat Nuclear Terrorism. Ukraine participated actively in all three Nuclear Security Summits. In 2012, Ukraine fulfilled its pledge to remove all highly enriched uranium from Ukraine, a highlight of the 2012 Summit.

In 2013, we extended the U.S.-Ukraine Cooperative Threat Reduction Umbrella Agreement for another seven years, as well as an agreement to increase safety and risk reduction at civilian nuclear facilities in Ukraine. Recent events in Ukraine underline the importance of bringing to closure to the legacy of Chernobyl by finishing construction of a landmark shelter to durably protect the population and environment, a project to which the United States has pledged approximately $337 million. Last month, a joint U.S. – Ukraine project to construct a Neutron Source Facility at the Kharkiv Institute for Physics and Technology was completed, providing Ukraine with new research capabilities and the ability to produce industrial and medical isotopes. In short, U.S. – Ukrainian cooperation on nuclear security and nonproliferation is broad and deep.

U.S. Commitment to Nonproliferation

We applaud Minister of Foreign Affairs Deshchytsia’s reaffirmation of Ukraine’s longstanding commitment to its nonproliferation obligations at the Nuclear Security Summit last month. Like Ukraine, the United States is committed to achieving the peace and security of a world without nuclear weapons. This is a central element of President Obama’s nuclear agenda. There is a long road ahead, but we are working to create the conditions for its eventual achievement. As President Obama said in Berlin in June, 2013, the United States can ensure its security and that of its allies while safely pursuing further nuclear reductions with Russia of up to one-third in the deployed strategic warhead level established in the New START Treaty.
As next steps toward nuclear disarmament, the United States remains committed to pursuing entry into force of the Comprehensive Nuclear-Test-Ban Treaty and consensus to start negotiations on a Fissile Material Cutoff Treaty.

I would like to highlight the work done at the P5 Conference earlier this month in Beijing toward implementing the Action Plan adopted at the 2010 NPT Review Conference
The NPT serves as a key element of international security and the basis for international nuclear cooperation. We will continue to address the serious challenges of cases of noncompliance with Treaty obligations, and will continue to support expanding access to the peaceful uses of nuclear energy. We look forward to a productive Preparatory Committee meeting, and reaffirm our commitment to ensuring the Treaty’s contributions to international peace and security are strengthened.

I thank our Ukrainian hosts again for today and congratulate them again on this important anniversary and their continued leadership within the NPT. I look forward to working with Ukraine, and with all other NPT Parties, over the coming weeks to ensure that the NPT remains strong.

As Secretary Kerry stated last week, the world will remain united for Ukraine.

U.S. CONGRATULATES PEOPLE OF REPUBLIC OF THE MARSHALL ISLANDS ON THEIR NATIONAL DAY

FROM:  U.S. STATE DEPARTMENT 

The Marshall Islands National Day

Press Statement

John Kerry

Secretary of State

Washington, DC

April 29, 2014

On behalf of President Obama and the people of the United States, I congratulate the citizens of the Republic of the Marshall Islands on the anniversary of your nation’s independence.

Our two countries share a long history of cooperation, mutual respect, and friendship. We look forward to continuing to work together on advancing human rights, strengthening economic development, enhancing regional security, mitigating environmental threats, and improving health and education services for all Marshallese citizens. We are grateful for the dedication and voluntary sacrifice of Marshallese serving in the U.S. Armed Forces as we work together promoting security and stability around the world.

Congratulations and warmest wishes for a year of progress, prosperity, and peace.

PRESIDENT OBAMA'S REMARKS ON RAISING MINIMUM WAGE

FROM:  THE WHITE HOUSE 

April 30, 2014

Remarks by the President on Raising the Minimum Wage

East Room

3:02 P.M. EDT

THE PRESIDENT:  Thank you, everybody.  Please have a seat.  Good afternoon.

AUDIENCE MEMBER:  Aloha!

THE PRESIDENT:  Aloha.  (Laughter.)  Got a Hawaiian guy here.

After 14 months since I’ve called on Congress to reward the hard work of millions of Americans like the ones who we have here today to raise the federal minimum wage, we saw this morning a majority of senators saying “yes,” but almost every Republican saying “no” to giving America a raise.

They blocked a bill –- sponsored by Senator Tom Harkin and Congressman George Miller, who is right here in front.  (Applause.)  A bill that would have gradually raised the minimum wage from $7.25 an hour to $10.10 an hour.  By preventing even a vote on this bill, they prevented a raise for 28 million hardworking Americans.   They said no to helping millions work their way out of poverty -- and keep in mind, this bill would have done so without any new taxes, or spending, or bureaucracy.  They told Americans like the ones who are here today that “you’re on your own” -– without even looking them in the eye.

We know these Americans.  We depend on them.  The workers who’d benefit from a minimum wage increase often work full-time, often in physically demanding jobs.  They average 35 years of age.  Most low-paying jobs are held by women.  But because Republicans in Congress said “no” to even allowing a vote on the floor of the Senate, these folks are going to have to wait for the raise they deserve.

Now the good news is outside of Washington folks aren’t waiting.  While Republicans have been deciding whether to even allow a minimum wage bill to even come up for a vote, you’ve seen 10 states and the District of Columbia go ahead and raise theirs.  (Applause.)  Yesterday, the Hawaii legislature voted to raise their minimum wage to $10.10 an hour.  Maryland did the same thing earlier this month -– and I know we’ve got some Maryland state legislators here today.  Thanks for the good work.  (Applause.)

So the actions that have been taken in just four states -- Maryland, Connecticut, Minnesota, and Hawaii -– means that over a million workers will see a raise.  What’s more, we’ve seen big companies like The Gap, and small businesses -- from a pizza joint in St. Louis to an ice cream parlor in Florida -- increasingly choosing to raise wages for their employees because they know it’s good business.  They know that it means employees are more likely to stay on the job, less turnover.  It means that they’re going to be more productive, and customers see the difference.  That’s one of the reasons I issued an executive order requiring employees on new federal contracts to be paid a fair wage of at least $10.10 an hour.  (Applause.)

So Americans have been way out in front of Congress on this issue.  In fact, about three in four Americans support raising the minimum wage.  And that’s because we believe that in the wealthiest nation on Earth, nobody who works full-time should ever have to raise a family in poverty.  That’s a basic principle.  (Applause.)  And at a time when those at the top are doing better than ever, while millions of Americans are working harder and harder just to get by, that three out of four Americans understands that America deserves a raise.

A few months ago, I got a letter from a woman named Sheila Artis.  And Sheila lives in Lilburn, Georgia and at the time she was working two jobs -- making $8 an hour at each job.  As Sheila wrote, “I do not have days off, I have hours off.”  But she kept going to work every day because she wanted to be able to afford college tuition for her daughter.  And so she wrote to me and said, “I do not want a pot of gold.  All I want is to pay for college and pay my bills in full every month.”  That's all she’s looking for.  Doesn't expect to get wealthy, just wants to be able to pay the bills at the end of every month, be able to act responsibly, meet her responsibilities based on her own hard work.

People like Sheila deserve a fair shot.  So far Republicans in Congress disagree.  In fact, some of them want to scrap the minimum wage entirely.  One House Republican said, “It’s outlived its usefulness.  I’d vote to repeal the minimum wage.”  A Senate Republican said he doesn’t think the minimum wage helps the middle class.

This is a very simple issue.  Either you’re in favor of raising wages for hardworking Americans, or you’re not.  Either you want to grow the economy from the middle out and the bottom up so that prosperity is broad-based, or you think that top-down economics is the way to go.

Republicans in Congress have found the time to vote more than 50 times to undermine or repeal the health care bill for millions of working families.  Earlier this month, they voted for a budget that would give the wealthiest Americans a massive tax cut while forcing deep cuts to investments that help middle-class families.  But they won’t raise wages for millions of working families when three-quarters of Americans support it?  That makes no sense.  And on top of that, they’ve blocked our efforts to make sure women receive equal pay for equal work.  They’ve stood in the way as we’ve fought to extend unemployment insurance for parents who need a little help supporting their families while they’re out looking for work.  Republicans have failed to dismantle the Affordable Care Act, and they’ve increasingly failed to do anything when it comes to helping people who work hard get ahead.

If there’s any good news here, it’s that Republicans in Congress don’t get the last word on this or any issue -- you do, the American people, the voters.  (Applause.)  Change is happening, whether Republicans in Congress like it or not. And so my message to the American people is this:  Do not get discouraged by a vote like the one we saw this morning.  Get fired up.  Get organized.  Make your voices heard.  (Applause.)  And rest assured, I’m going to keep working with you and Leader Nancy Pelosi and other members of Congress who are here today to raise wages for hardworking Americans.  It’s the right thing to do.  (Applause.)

If your member of Congress doesn’t support raising the minimum wage, you’ve got to let them know they’re out of step, and that if they keep putting politics ahead of working Americans, you’ll put them out of office.  Tell them to reconsider.  Tell them it’s time for $10.10.  You can tweet at them -- use hashtag #1010Means.  Let them know how raising the minimum wage would help you, or your family, or somebody that you know.  And while you’re at it, tell them to restore unemployment insurance for Americans who are trying to support their families right now while they look for work.  (Applause.)  Extending this lifeline of unemployment insurance would actually strengthen the economy and create jobs, and give millions of Americans across the country a sense of hope.

In the meantime, I’m going to keep offering my support to every business owner, and mayor, and governor, and county official, and legislator, and organization that’s working to give America a raise.  Because change does not come from Washington, it comes to Washington from all the folks out there who are working hard.  Americans want the people they send here to set aside the old political arguments and move this country forward.  With enough determination and enough persistence, the American people will ultimately win out.

So thank you, God bless you.  God bless the United States of America.  (Applause.)

U.S. DEFENSE DEPARTMENT CONTRACTS FOR APRIL 30, 2014

FROM:  U.S. DEFENSE DEPARTMENT 

CONTRACTS

ARMY

TMG Services*, Cleveland, Ohio (W9127S-14-D-6000); Aerostar SES LLC*, Oak Ridge, Tenn. (W9127S-14-D-6001); Zieson Construction Co., LLC*, Topeka, Kan. (W9127S-14-D-6002) were awarded a $200,000,000 firm-fixed-price, indefinite-delivery/indefinite-quantity, multiple award task order contract for designing and building repairs to the infrastructure for U.S. Air Force Medical Service healthcare facilities nationwide. Funding and work performance location will be determined with each order. Estimated completion date is April 29, 2017. Bids were solicited via the Internet with 25 received. U.S. Army Corps of Engineers, Little Rock, Ark., is the contracting activity.

JCB Inc., Pooler, Ga., was awarded a $39,446,851 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for procurement of an estimated 90 High Mobility Engineer Excavators-Type-I (HMEE-I) and vehicle attachments. Funding and work performance location will be determined with each order. Estimated completion date is Dec. 29, 2017. Bids were solicited via the Internet with one received. Army Contracting Command, Warren, Mich., is the contracting activity (W56HZV-14-D-0066).

Columbia Helicopters Inc.*, Aurora, Ore., was awarded a $30,552,180 firm-fixed-price contract for the after rotor head and the forward rotor head for the Chinook weapons system. The minimum quantity (combined for the rotor heads) is ten and the maximum quantity is 198. Funding and performance location will be determined with each order. Estimated completion date is April 24, 2019. Bids were solicited via the Internet with two received. Army Contracting Command, Redstone Arsenal, Ala., is the contracting activity (W58RGZ-14-D-0078).
Kongsberg Defence & Aerospace, Kongsberg, Norway, was awarded a $29,702,000 modification (P00079) to contract W15QKN-12-C-0103 for depot support for the Common Remotely Operated Weapon Station. Fiscal 2014 operations and maintenance, Army funds in the amount of $29,702,000 were obligated at the time of the award. Work will be performed at in Johnstown, Pa., with an estimated completion date of Aug. 16, 2017. Army Contracting Command, Picatinny Arsenal, N.J., is the contracting activity.

Hellfire Systems LLC, Orlando, Fla., was awarded a $28,408,525 modification (P00083) to foreign military sales contract (Saudi Arabia, Indonesia, Jordan) W31P4Q-11-C-0242 for 372 Hellfire II air-to-ground tactical containerized models: AGM-114R, AGM-114R-3, and AGM-114P-4A. Fiscal 2012, 2013 and 2014 other procurement funds in amount of $28,408,525 are being obligated at award. Work will be performed at Orlando, Fla., with an estimated completion date of Nov. 30, 2016. Army Contracting Command, Redstone Arsenal, Ala., is the contracting activity.

Longbow LLC, Orlando, Fla., was awarded a $25,197,219 modification (P00006) to contract W58RGZ-12-C-0049 for the production of seventeen radar electronics units and unmanned aerial system tactical common data link assemblies, a P4.00 software upgrade, and associated gold standard hardware for production testing. Fiscal 2013 other procurement funds in the amount of $25,197,239 were obligated at the time of the award. Estimated completion date is July 31, 2015. Work will be performed in Orlando, Fla. Army Contracting Command, Redstone, Ala., is the contracting activity.

L-3 Communications Corp., Muskegon, Mich., was awarded a $10,533,875 modification (P00122) to contract W56HZV-09-C-0098 for 26,752 hours for systems technical support for the Bradley transmission. Fiscal 2014 research, development, technology, and evaluation funds in the amount of $10,408,156 and fiscal 2010 other procurement funds in the amount of $125,719 were obligated at the time of the award. Estimated completion date is June 30, 2015. Work will be performed Muskegon, Mich. Army Contracting Command, Warren, Mich., is the contracting activity.

ARMTEC, Coachella, Calif., was awarded a $9,900,000 firm-fixed-price, indefinite-delivery, sole-source contract to design, develop, maintain and manufacture systems using combustible and consumable type products technology for the Army Research, Development and Engineering Command. Funding and work performance location will be determined with each order. Estimated completion date is May 1, 2019. One bid was solicited and one received. Army Contracting Command, Picatinny Arsenal, N.J., is the contracting activity (W15QKN-14-D-0004).

Value Management Strategies Inc.*, Escondido, Calif. (W912DR-14-D-0001); Strategic Value Solutions Inc.* Independence, Mo. (W912DR-14-D-0002) were awarded a $9,000,000 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for architectural and engineering management service for the U.S. Army Corps of Engineers, Baltimore District Military, Environmental and Civil Works programs throughout the North Atlantic Division. Funding and work performance location will be determined with each order. Estimated completion date is April 29, 2019. Two bids were solicited and two received. U.S. Army Corps of Engineers, Baltimore, Md., is the contracting activity.

DEFENSE LOGISTICS AGENCY

SupplyCore*, Rockford, Ill., has been awarded a maximum $200,000,000 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for maintenance, repair, and operations tailored logistics support prime vendor programs. This is a competitive acquisition, and seven offers were received. This is a five-year base contract with no options. Location of performance is Illinois with a May 1, 2019 performance completion date. Using services are Army, Navy, Air Force, and Marine Corps. Type of appropriation is fiscal 2014 through fiscal 2019 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pa., (SPM8EG-14-D-0002).

Signature Flight Support Corp., Newport News, Va., has been awarded a maximum $15,088,634 fixed-price with economic-price-adjustment contract for fuel. This is a competitive acquisition, and two offers were received. This is a four-year base contract with no options. Locations of performance are Virginia and California with a March 31, 2018 performance completion date. Using services are Army, Navy, Air Force, Marine Corps, and federal civilian agencies. Type of appropriation is fiscal 2013 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Va., (SP0600-14-D-0017).

NAVY

Contracting Solutions International LLC,* Tulsa, Okla. (N62645-14-D-5023); Distinctive Spectrum Healthcare Joint Venture,* Largo, Md. (N62645-14-D-5024); Protégé Health Services LLC,* Newington, Va. (N62645-14-D-5025); Saratoga Medical Center Inc.,* Fairfax, Va. (N62645-14-D-5026); TIST Corp., Inc.,* San Antonio, Texas (N62645-14-D-5027), are each being awarded a 36-month, firm-fixed price, indefinite-delivery/indefinite-quantity, multiple award task order contract for various nursing services that include the labor bands of advanced practice nurse and nursing. The aggregate not-to-exceed amount for these multiple award contracts combined is $27,693,133. The five contractors will have the opportunity to bid on each individual task order. Work will be performed at military treatment facilities in the Southeast region of the United States to include: Naval Hospital Jacksonville, Fla. (25 percent); Naval Health Clinic Corpus Christi, Texas (25 percent); Naval Hospital Pensacola, Fla. (25 percent); Naval Hospital Camp Lejeune, N.C. (10 percent); Naval Hospital Beaufort, S.C. (3 percent); Naval Hospital Cherry Point, N.C. (3 percent); Naval Health Clinic Charleston, S.C. (3 percent); Navy Medicine Operational Training Center Pensacola, Fla. (3 percent); and any associated branch clinics (3 percent). Work performed under these contracts is expected to be completed Sept. 30, 2017. Fiscal 2015 defense health program funds in the amount of $1,999,801 will be obligated at the time of award and the funds will expire at the end of the current fiscal year. Funding is predominantly from the Defense Health Program; however, other funding initiatives such as psychological health/traumatic brain injury, overseas contingency operations and wounded, ill, and injured may be used. These are all one-year funding types. These contracts were solicited via a multiple award electronic request for proposals as a 100 percent small business set-aside; 55 offers were received. The Naval Medical Logistics Command, Fort Detrick, Md., is the contracting activity.

The Boeing Co., St. Louis, Mo., is being awarded $26,725,000 for cost-plus-incentive-fee delivery order 0080 against a previously issued basic ordering agreement (N00019-11-G-0001) to provide seven flight critical engineering changes proposals for fracture and maintenance critical areas of the F/A-18 A-D airframe under the Service Life Extension Program Phase C1 effort. Work will be performed in St. Louis, Mo. (55 percent) and El Segundo, Calif. (45 percent), and is expected to be completed in July 2015. Fiscal 2013 and 2014 aircraft procurement, Navy funds in the amount of $13,095,250 will be 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 activity.
COLSA Corp., Huntsville, Ala., is being awarded a potential $25,607,908 indefinite-delivery/indefinite-quantity, cost-plus-fixed-fee contract to support the Space and Naval Warfare Systems Center Pacific (SSC Pacific) Integrated Voice Networks Branch to provide telephony network support. This is one of two contracts awarded: both awardees will have the opportunity to compete for task orders during the ordering period. This three-year contract including two, one-year option periods, which, if exercised, would bring the potential ceiling value of this award to an estimated $43,071,400. Work will be performed at SSC Pacific facilities, on Navy ships, and at other government sites in San Diego, and work is expected to be completed April 29, 2017. Fiscal 2014 operations and maintenance, Navy and other procurement, Navy funds in the amount of $25,000 will be obligated at the time of award, and will not expire at the end of the current fiscal year. This contract was competitively procured via full and open solicitation and publication on the Federal Business Opportunities website and the SPAWAR e-Commerce Central website. Three proposals were received and two were selected for award. SSC Pacific, San Diego, Calif., is the contracting activity (N66001-14-D-0100).

Engineering Services Network Inc., Arlington, Va., is being awarded a potential $24,530,896 indefinite-delivery/indefinite-quantity, cost-plus-fixed-fee contract to support the Space and Naval Warfare Systems Center Pacific (SSC Pacific) Integrated Voice Networks Branch to provide telephony network support. This is one of two contracts awarded: both awardees will have the opportunity to compete for task orders during the ordering period. This three-year contract including two, one-year option periods, which, if exercised, would bring the potential ceiling value of this award to an estimated $41,213,375. Work will be performed at SSC Pacific facilities, on Navy ships, and at other government sites in San Diego, and work is expected to be completed April 29, 2017. Fiscal 2014 operations and maintenance, Navy and other procurement, Navy funds in the amount of $25,000 will be obligated at the time of award, and will not expire at the end of the current fiscal year. This contract was competitively procured via full and open solicitation and publication on the Federal Business Opportunities website and the SPAWAR e-Commerce Central website. Three proposals were received and two were selected for award. SSC Pacific, San Diego, Calif., is the contracting activity (N66001-14-D-0101).

Ball Aerospace Technologies Inc., Boulder, Colo., is being awarded a $23,933,170 firm-fixed-price contract for “Stalker” or long range electro-optical/infrared/laser range finder (SLREOSS) production. SLREOSS is used with the NATO Seasparrow Missile System MK 57 on the MK 9 Tracker Illuminator System. Work will be performed in Broomfield, Colo., and is expected to be completed by April 2016. Fiscal 2014 other procurement, Navy and fiscal 2014 research, development, test and evaluation funding in the amount of $13,419,877 will be obligated at time of award and will not expire at the end of the current fiscal year. This contract was not competitively procured in accordance with 10 U.S.C. 2304 (c)(1), as implemented by FAR 6.302-1 - only one responsible source and no other supplies or services will satisfy agency requirements. The Naval Sea Systems Command, Washington D.C., is the contracting activity (N00024-14-C-5412).

Logos Technologies Inc.*, Fairfax, Va., is being awarded a $23,648,907 cost-plus-fixed-fee contract for field service representatives, operators, and analysts required to support Persistent Ground Surveillance Systems Kestrel systems deployed outside of the continental United States for the U.S. Army. Work will be performed in Fairfax, Va. (68 percent); Afghanistan (28 percent); and Raleigh, N.C. (4 percent), and is expected to be completed in December 2014. Fiscal 2014 operations and maintenance, Army funds in the amount of $1,500,000 are being obligated at time of award, all of which will expire at the end of the current fiscal year. This contract was not competitively procured pursuant to 10 U.S.C. 2304(c)(1). The Naval Air Warfare Center Aircraft Division, Lakehurst, N.J., is the contracting activity (N68335-14-C-0196).

Brady GCE II*, San Diego, Calif., is being awarded a maximum amount $20,000,000 firm-fixed-price, indefinite-delivery/indefinite-quantity architect-engineering (A-E) contract for A-E services for comprehensive environmental response, Compensation Liability Act, Resource Conservation and Recovery Act, underground storage tank studies and environmental engineering support services at Navy and Marine Corps installations in the Naval Facilities Engineering Command Southwest (NAVFAC SW) area of responsibility (AOR). No task orders are being issued at this time. All work will be performed at various Navy and Marine Corps installations in California (90 percent); Arizona (3 percent); Nevada (3 percent); Colorado (2 percent); Utah (1 percent), and other Department of Defense installations in the NAVFAC SW AOR (1 percent). The term of the contract is not to exceed 60 months with an expected completion date of April 2019. Fiscal 2014 environmental restoration, Navy contract funds in the amount of $5,000 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 eight proposals received. The Naval Facilities Engineering Command, Southwest, San Diego, Calif., is the contracting activity (N62473-14-D-1405).

Raytheon Missile Systems, Tucson, Ariz., is being awarded a $6,553,058 cost-plus-fixed-fee contract for calendar years 2014-2016 Evolved Seasparrow Missile (ESSM) depot and intermediate level maintenance, all-up-round recertifications, and special maintenance tasks. This contract will provide for the repair, maintenance and recertification of ESSM Missiles, sections, assemblies, subassemblies, components and test or support equipment. This contract includes options which, if exercised, would bring the cumulative value of this contract to $15,007,740. Work will be performed in Tucson, Ariz. (89 percent), Camden, Ark. (8 percent), Huntsville, Ala. (2 percent), and Andover, Mass. (1 percent), and is expected to be completed by December 2016. Fiscal 2014 other procurement, Navy and fiscal 2014 operations and maintenance, Navy funding in the amount of $4,379,678 is being obligated at time of award. Contract funds in the amount of $500,000 will expire at the end of the current fiscal year. This contract was not competitively procured in accordance with 10 U.S.C. 2304 (c)(1), as implemented by FAR 6.302-1 - only one responsible source and no other supplies or services will satisfy agency requirements. The Naval Sea Systems Command, Washington D.C., is the contracting activity (N00024-14-C-5411).

AIR FORCE

Georgia Tech Applied Research Corp., Atlanta, Ga., has been awarded a $19,999,676 delivery order (0269) on the SENSIAC indefinite-delivery/indefinite-quantity, cost-plus-fixed-fee, sole source (HC1047-05-D-4000) for Systems Engineering, Modeling & Simulation, and Scientific Studies & Analysis Support on Emerging Threats Affecting National Security and DoD Acquisition Process. SENSIAC will provide recommendations for specified areas of study, United States/allies capability gaps concerning the threats, and how the U.S. should posture itself to counter these threats in order to favorably shape the battlespace. The work will be performed in Atlanta, Ga., and work is expected to be complete by Dec. 6, 2015. Fiscal 2014 operations and maintenance and research and development funds in the amount of $2,384,604 are being obligated at time of award. Air Force Installation Contracting Agency/KD, Offutt Air Force Base, Neb., is the contracting activity.

Alion Science and Technology Corp., McLean, Va., has been awarded a $14,138,642 delivery order (0063) on the AMMTIAC indefinite-delivery/indefinite-quantity, cost-plus-fixed-fee, sole-source contract (FA4600-06-D-0003) for operational safety, suitability and effectiveness materials improvement program. AMMTIAC's goal is to increase C-5 aircraft safety and mission readiness while reducing maintenance requirements and cost. The work will be performed at Warner Robins Air Logistics Complex, Robins Air Force Base, Ga., various U.S. Air Force locations, and at the AMMTIAC contractor facilities, and is expected to be complete by Dec. 29, 2016. Fiscal 2014 operations and maintenance and defense working capital funds funds in the amount of $2,075,098 are being obligated at time of award. AFICA/KD, Offutt Air Force Base, Neb., is the contracting activity.

Flight Safety Services Corp., Centennial, Colo., has been awarded an $11,787,928 firm-fixed-price modification (P00071) to FA8223-11-C-0003 for student aircrew training. The contract modification provides instructors to teach aircrew initial qualification courses, refresher courses, upgrade courses and others to fully qualify C-5 aircrews in all mission design series versions. This affects five training locations: Dover Air Force Base (AFB), Del., Travis AFB, Calif., Lackland AFB, Texas, Westover Air Reserve Base, Mass., and Martinsburg Air National Guard Base, W.Va., and the work is expected to be completed March 31, 2015 This effort also provides new student aircrew training pricing matrices for the remainder of the contract. Fiscal 2014 operations and maintenance funds in the amount of $8,860,395 are being obligated at time of award. Agile Combat Support, Simulators Division, Wright-Patterson AFB, Ohio, is the contracting activity.

Qinetiq North America Inc., Waltham, Mass., has been awarded a maximum $7,750,000 indefinite-delivery/indefinite-quantity contract for the Battlefield Air Targeting Man-Aided Knowledge II (BATMAN II)-Advanced Technology Demonstration Program, and a $218,128 cost-plus-fixed-fee task order for BATMAN II. The BATMAN II program is designed to focus on advancing technologies relevant to the special operators of the Air Force. The complex nature of the ground operations conducted by Battlefield Airmen require advanced technologies to reduce fatigue and workload in austere environments, increase mission effectiveness, reduce tactical decision making time and errors, and enhance situational awareness. The technologies developed under the BATMAN II program will focus on accelerating the development, demonstration, and assessment timeline of critical, mission capabilities. Work will be performed in Waltham, Mass., and is expected to be completed by April 30, 2020. Task order 0001 is expected to be completed by April 30, 2015. The award is the result of a competitive acquisition, and five offers were received. Fiscal 2014 research and development funds in the amount of $218,128 are to be obligated at time of award. Air Force Research Laboratory, Human Effectiveness-Biosciences Protection Contracting, Wright-Patterson Air Force Base, Ohio, is the contracting activity (FA8650-14-D-6529 and Task Order 0001).

Northrop Grumman Corp., Aerospace Systems, El Segundo, Calif., has been awarded a $6,567,841 modification (P00264) to F19628-00-C-0100 for radar system development and demonstration schedule extension. The contract modification is for Multi-Platform Radar Technology Insertion Program (MP-RTIP) radar system development and demonstration alignment with the Global Hawk Block 40 program schedule. Work will be performed at El Segundo, Calif., and is expected to be completed on Aug. 31, 20 14. Fiscal 2013 research and development funds in the amount of $3,843,413 are being obligated at time of award. Air Force Life Cycle Management Center, Hanscom Air Force Base, Mass., is the contracting activity.

DEFENSE ADVANCED RESEARCH PROJECTS AGENCY

Lockheed Martin Advanced Technologies Lab, Cherry Hill, N.J., has been awarded a $13,362,252 modification (P00016) to previously awarded contract (HR0011-11-C-0033) to incorporate new add work, Phase 3, to the DARPA Behavioral Learning for Adaptive Electronic Warfare (BLADE) program. The modification brings the estimated face value of the contract to $29,367,326 from $16,005,074. The objectives of the Phase 3 BLADE program are to refine and technically mature algorithms and software developed during Phase 2 of the program and to apply them in tactically relevant environments and timeframes on tactical military electronic attack platforms. The program will culminate in over-the-air and on-the-move testing and valuation of the BLADE system in an operationally representative environment. Work will be performed in Cherry Hill, N.J. (64.2 percent), Blacksburg, Va. (3.3 percent), Fort Wayne, Ind. (28.7 percent), and California, Md. (3.8 percent), and is expected to be completed by October 2015. Fiscal 2014 research and development funds in the amount of $8,000,000 will be obligated at the time of the award. The contracting activity is DARPA, Arlington, Va.

U.S. SPECIAL OPERATIONS COMMAND

Cyberspace Solutions of Reston, Va., is being awarded a $35,556,730 firm-fixed-price contract for intelligence analyst support, in support of U.S. Special Operations Command. The work will be conducted at multiple locations in the United States and overseas and is expected to be completed May 1, 2015. Fiscal 2014 operation and maintenance funds in the amount of $1,000,000 are being obligated at time of award. This contract was awarded through a competitive Service Disabled Veteran Owned Small Business set-aside with 15 proposals received. U.S. Special Operations Command, Tampa, Fla., is the contracting activity (H92222-14-C-0019).

*Small Business

NASA'S CURIOSITY MARS ROVER LOOKS AT TARGET

FROM:   NASA 

This image from the Navigation Camera (Navcam) on NASA's Curiosity Mars rover shows a sandstone slab on which the rover team has selected a target, "Windjana," for close-up examination and possible drilling.  The target is on the approximately 2-foot-wide (60-centimeter-wide) rock seen in the right half of this view.  The Navcam's left-eye camera took this image during the 609th Martian day, or sol, of Curiosity's work on Mars (April 23, 2014). The rover's name is written on the covering for a portion of the robotic arm, here seen stowed at the front of the vehicle. The sandstone target's informal name comes from Windjana Gorge in Western Australia.  If this target meets criteria set by engineers and scientists, it could become the mission's third drilled rock and the first that is not mudstone. The rock is within a waypoint location called "the Kimberley," where sandstone outcrops with differing resistance to wind erosion result in a stair-step pattern of layers.  Windjana is within what the team calls the area's "middle unit," because it is intermediate between rocks that form buttes in the area and lower-lying rocks that show a pattern of striations. NASA's Jet Propulsion Laboratory, a division of the California Institute of Technology, Pasadena, manages the Mars Science Laboratory Project for NASA's Science Mission Directorate, Washington. JPL designed and built the project's Curiosity rover and the rover's Navcam.  NASA's Curiosity Mars Rover Inspects Site Image Credit-NASA-JPL-Caltech.

MAN SENTENCED IN $4 MILLION HOME LOAN MODIFICATION SCAM

FROM:  U.S. JUSTICE DEPARTMENT 

Thursday, April 24, 2014

Maryland Man Sentenced for Defrauding Thousands of Homeowners in $4 Million Nationwide Home Loan Modification Scam

A Maryland man was sentenced today to serve one year and a day in prison for defrauding thousands of homeowners in a $4 million nationwide home loan modification scheme.

Acting Assistant Attorney General David A. O’Neil of the Justice Department’s Criminal Division, U.S. Attorney Carmen M. Ortiz of the District of Massachusetts and Special Inspector General for the Troubled Asset Relief Program (SIGTARP) Christy Romero made the announcement.

Brian Kelly, 37, of Forest Hill, was sentenced by U.S. District Court Judge Rya W. Zobel of the District of Massachusetts and ordered to serve three years of supervised release following his prison term.   Restitution will be determined at a later date.

Kelly pleaded guilty on May 2, 2013, to one count of conspiracy, nine counts of mail fraud and nine counts of wire fraud.

According to court records, Kelly and others, operating under the name Home Owners Protection Economics Inc. (HOPE), made a series of misrepresentations to induce struggling homeowners to pay HOPE $400 to $2,000 in up-front fees in exchange for HOPE’s help obtaining federally funded home loan modifications.   Kelly was one of HOPE’s more successful salespeople, receiving approximately $24,000 after arranging fraudulent home loan modifications totaling approximately $180,000.

Also according to court documents, the conspirators misrepresented that, with HOPE’s assistance, the homeowner was guaranteed to receive a loan modification under the Home Affordable Modification Program (HAMP), which is part of the Troubled Asset Relief Program (TARP) and is a federally funded mortgage-assistance program.   For example, the defendants routinely claimed that the homeowner had already been approved for a loan modification, provided phony “approval codes,” quoted new (and wholly fictitious) mortgage terms and due dates, touted their 98 percent past success rate and claimed that they were “underwriters” or were otherwise affiliated with the homeowners’ mortgage companies.   HOPE also claimed that it would offer homeowners refunds in the unlikely event that they did not receive a loan modification.

According to court documents, in exchange for the up-front fees, HOPE sent its customers, including homeowners in Massachusetts, a do-it-yourself application package, which was virtually identical to the application that the government provides free of charge.   The HOPE customers had no advantage in the application process, and, in fact, most of their applications were denied.   Through these misrepresentations, HOPE was able to persuade thousands of homeowners to pay more than $4 million in fees.

Two co-defendants, Christopher S. Godfrey, 44, of Delray Beach, Fla., and Dennis Fischer, 42, of Highland Beach, Fla., were convicted after trial and were each sentenced on Feb. 20, 2014, to serve 84 months in prison.  A third co-defendant, Vernell Burris, Jr., 54, of Coconut Creek, Fla, pleaded guilty and was sentenced on Feb. 25, 2014, to serve a year and a day in prison.

The case was investigated by SIGTARP and is being prosecuted by Senior Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Adam Bookbinder in the District of Massachusetts’s Computer Crimes Unit.