FROM: U.S. DEFENSE DEPARTMENT
Work Looks to Industry to Maintain Technology Edge
By Amaani Lyle
DoD News, Defense Media Activity
WASHINGTON, Nov. 19, 2014 – In remarks at the Defense One Summit here today, Deputy Secretary of Defense Robert O. Work stressed the importance of engaging industry, services and the Defense Business Board in maintaining the United States’ technological edge in coming years.
Work noted the challenge of balancing resources and requirements against the landscape of what he called an “especially chaotic” drawdown and a persistent continuing resolution over the past five years.
“The temporal aspects of this strategy are going to be much more challenging than in the past,” Work said. “And we’re going to have to do rapid prototyping … or we will continually lose ground.”
Budget Uncertainty Threatens Advances
Speaking on acquisition and technological advances, Work described the Defense Department’s focus across the decades, from the 1950’s nuclear weapons, 1960’s space, 1970’s stealth and microelectronics, 1980’s large-scale systems of systems into current systems that can face asymmetric challenges.
But efforts to increase base-level demonstrations, exercises and prototyping, Work said, can by stymied by budget uncertainties.
Work said that in response to those uncertainties, the department will seek to enhance its effectiveness through the Defense Business Board, which includes former chief executive officers, chief financial officers, chief operating officers and captains of industries.
“They’re now an operational arm directly associated with my deputy chief management officer and they’re going to help us benchmark against civilian business practices,” Work said.
So far, the DoD has been able to annually identify some $26 million in savings from duplication of contracts, administrative costs and other expenses over five years through these internal analyses, he said.
“That gave us great confidence that as we look at the broader defense agencies we were going to find significant savings,” Work said.
Thursday, November 20, 2014
SEC SUSPENDS TRADING IN EBOLA RELATED COMPANIES
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
11/20/2014 10:30 AM EST
The Securities and Exchange Commission today suspended trading in four companies that claim to be developing products or services in response to the Ebola outbreak, citing a lack of publicly available information about the companies’ operations.
The SEC simultaneously issued an investor alert warning about the potential for fraud in microcap companies purportedly involved in Ebola prevention, testing, or treatment, noting that scam artists often exploit the latest crisis in the news cycle to lure investors into supposedly promising investment opportunities.
The SEC Enforcement Division and its Microcap Fraud Task Force work to proactively identify microcap companies that are publicly disseminating information that appears inadequate or potentially inaccurate. The SEC has authority to issue trading suspensions against such companies. The companies whose trading was suspended today are Patchogue, N.Y.-based Bravo Enterprises Ltd., Monrovia, Calif.-based Immunotech Laboratories Inc., Toronto-based Myriad Interactive Media Inc., and Anaheim, Calif.-based Wholehealth Products Inc.
“We move quickly to protect investors when we see thinly-traded stocks being promoted with questionable information that make them ripe for pump-and-dump schemes,” said Elisha Frank, Co-Chair of the SEC Enforcement Division’s Microcap Fraud Task Force. “Fraudsters are constantly exploiting issues of public concern to tout a penny stock company supposedly in the business of addressing the latest crisis.”
Under the federal securities laws, the SEC can suspend trading in a stock for 10 days and generally prohibit a broker-dealer from soliciting investors to buy or sell the stock again until certain reporting requirements are met. More information about the trading suspension process is available in an SEC investor bulletin on the topic.
According to the SEC’s investor alert, similar to how natural disasters such as Hurricane Katrina and Hurricane Sandy have given rise to investment schemes for companies purportedly involved in cleanup efforts, con artists may perpetrate investment scams related to Ebola prevention or treatment efforts. The alert suggests that investors be wary about promises or guarantees of high investment returns with little or no risk, avoid solicitations with pressure to “buy RIGHT NOW,” and beware of unsolicited investment offers through social media.
11/20/2014 10:30 AM EST
The Securities and Exchange Commission today suspended trading in four companies that claim to be developing products or services in response to the Ebola outbreak, citing a lack of publicly available information about the companies’ operations.
The SEC simultaneously issued an investor alert warning about the potential for fraud in microcap companies purportedly involved in Ebola prevention, testing, or treatment, noting that scam artists often exploit the latest crisis in the news cycle to lure investors into supposedly promising investment opportunities.
The SEC Enforcement Division and its Microcap Fraud Task Force work to proactively identify microcap companies that are publicly disseminating information that appears inadequate or potentially inaccurate. The SEC has authority to issue trading suspensions against such companies. The companies whose trading was suspended today are Patchogue, N.Y.-based Bravo Enterprises Ltd., Monrovia, Calif.-based Immunotech Laboratories Inc., Toronto-based Myriad Interactive Media Inc., and Anaheim, Calif.-based Wholehealth Products Inc.
“We move quickly to protect investors when we see thinly-traded stocks being promoted with questionable information that make them ripe for pump-and-dump schemes,” said Elisha Frank, Co-Chair of the SEC Enforcement Division’s Microcap Fraud Task Force. “Fraudsters are constantly exploiting issues of public concern to tout a penny stock company supposedly in the business of addressing the latest crisis.”
Under the federal securities laws, the SEC can suspend trading in a stock for 10 days and generally prohibit a broker-dealer from soliciting investors to buy or sell the stock again until certain reporting requirements are met. More information about the trading suspension process is available in an SEC investor bulletin on the topic.
According to the SEC’s investor alert, similar to how natural disasters such as Hurricane Katrina and Hurricane Sandy have given rise to investment schemes for companies purportedly involved in cleanup efforts, con artists may perpetrate investment scams related to Ebola prevention or treatment efforts. The alert suggests that investors be wary about promises or guarantees of high investment returns with little or no risk, avoid solicitations with pressure to “buy RIGHT NOW,” and beware of unsolicited investment offers through social media.
PRESIDENT OBAMA'S REMARKS REGARDING REAUTHORIZATION OF CHILD CARE AND DEVELOPMENT BLOCK GRANT PROGRAM
FROM: THE WHITE HOUSE
November 19, 2014
Remarks by the President at Bill Signing
REMARKS BY THE PRESIDENT
AT SIGNING OF REAUTHORIZATION OF
THE CHILD CARE AND DEVELOPMENT BLOCK GRANT PROGRAM
Oval Office
11:58 A.M. EST
THE PRESIDENT: Well, as many of you know, one of my top priorities is making sure that we’ve got affordable, high-quality child care and early childhood education for our young people across the country. Today, I am pleased to sign a bill into law which is going to bring us closer to that goal -- that’s the reauthorization of the Child Care and Development Block Grant program. I want to thank bipartisan members of Congress who are here today.
This law is going to do several important things. It’s going to improve the quality of child care by requiring more training for caregivers and more enrichment for children. It’s going to improve child safety by instituting background checks for staff and better inspection of facilities. It’s going to give working parents a little more peace of mind -- if you receive subsidies to pay for your child care, you know that if you get a raise on your job or you find a job, your kids aren’t automatically losing their care because your status has changed midstream.
I first proposed legislation that accomplished some of these goals back in 2010. When we couldn’t get it through Congress, we began a rulemaking process to try to do this through executive efforts -- and Sylvia Burwell, the HHS Secretary, is here. Because the legislation has now passed, we are actually ending the rulemaking process because we’ve now got a law, and we’re going to be able to focus on implementing the law.
And I want to thank all the legislators here. It’s a good step forward. It shows that Democrats and Republicans, when it comes to making sure our kids are getting the best possible education, are united. And that’s good for our kids and that’s good for our country.
So with that, I’m going to make sure that I sign this properly, using all these pens.
(The bill is signed.)
END
November 19, 2014
Remarks by the President at Bill Signing
REMARKS BY THE PRESIDENT
AT SIGNING OF REAUTHORIZATION OF
THE CHILD CARE AND DEVELOPMENT BLOCK GRANT PROGRAM
Oval Office
11:58 A.M. EST
THE PRESIDENT: Well, as many of you know, one of my top priorities is making sure that we’ve got affordable, high-quality child care and early childhood education for our young people across the country. Today, I am pleased to sign a bill into law which is going to bring us closer to that goal -- that’s the reauthorization of the Child Care and Development Block Grant program. I want to thank bipartisan members of Congress who are here today.
This law is going to do several important things. It’s going to improve the quality of child care by requiring more training for caregivers and more enrichment for children. It’s going to improve child safety by instituting background checks for staff and better inspection of facilities. It’s going to give working parents a little more peace of mind -- if you receive subsidies to pay for your child care, you know that if you get a raise on your job or you find a job, your kids aren’t automatically losing their care because your status has changed midstream.
I first proposed legislation that accomplished some of these goals back in 2010. When we couldn’t get it through Congress, we began a rulemaking process to try to do this through executive efforts -- and Sylvia Burwell, the HHS Secretary, is here. Because the legislation has now passed, we are actually ending the rulemaking process because we’ve now got a law, and we’re going to be able to focus on implementing the law.
And I want to thank all the legislators here. It’s a good step forward. It shows that Democrats and Republicans, when it comes to making sure our kids are getting the best possible education, are united. And that’s good for our kids and that’s good for our country.
So with that, I’m going to make sure that I sign this properly, using all these pens.
(The bill is signed.)
END
FLORIDA HOSPITAL CEO PLEADS GUILTY FOR ROLE IN $67 MILLION MENTAL HEALTH CARE FRAUD CASE
FROM: U.S. JUSTICE DEPARTMENT
Tuesday, November 18, 2014
Miami-Area Hospital Chief Operating Officer Pleads Guilty in $67 Million Mental Health Care Fraud Scheme
The former chief operating officer of a Miami-area hospital pleaded guilty today for his role in a mental health care fraud scheme that resulted in the submission of more than $67 million in fraudulent claims to Medicare by a state-licensed psychiatric hospital located in Hollywood, Florida, that purported to offer both inpatient and outpatient mental health services.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Derrick Jackson of the U.S. Health and Human Services Office of Inspector General’s (HHS-OIG) Florida region made the announcement.
Christopher Gabel, 61, of Davie, Florida, the former Chief Operating Officer (COO) of Hollywood Pavilion LLC (HP), pleaded guilty before U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida to one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States and pay and receive health care kickbacks. Gabel was charged in an indictment returned on May 8, 2014.
According to Gabel’s admissions in connection with his guilty plea, between April 2003 and September 2012, HP submitted false and fraudulent claims to Medicare for treatment that was not medically necessary or not provided to patients. As COO during that time, Gabel supervised HP’s staff at both its inpatient and outpatient facilities, where Medicare beneficiaries were admitted to HP regardless of whether they qualified for mental health treatment, and were often admitted before seeing a doctor.
Gabel admitted that HP obtained Medicare beneficiaries from across the country by paying bribes and kickbacks to various patient brokers. Gabel instructed the patient brokers to falsify invoices and marketing reports in an effort to hide, and cover up the true nature of the bribes and kickbacks they were receiving from HP. From 2003 through August 2012, HP billed Medicare approximately $67 million for services that were not properly rendered, for patients that did not qualify for the services being billed, and for claims for patients who were procured through bribes and kickbacks. Medicare reimbursed HP nearly $40 million for those claims.
Karen Kallen-Zury, Daisy Miller, Michele Petrie and Christian Coloma were convicted at trial in June 2013 for their roles in this scheme. Kallen-Zury, HP’s former chief executive officer, was sentenced to 25 years in prison. Miller, the clinical director of HP’s inpatient facility, was sentenced to 15 years in prison; and Petrie, the head of HP’s intensive outpatient program, was sentenced to six years in prison. Coloma, the director of physical therapy for an entity associated with HP, was sentenced to 12 years in prison. Kallen-Zury, Miller and Petrie were ordered to pay nearly $40 million in restitution, and Coloma was ordered to pay more than $20 million in restitution.
The case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. The case is being prosecuted by Trial Attorneys Nicholas E. Surmacz, Andrew H. Warren and L. Rush Atkinson of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
Tuesday, November 18, 2014
Miami-Area Hospital Chief Operating Officer Pleads Guilty in $67 Million Mental Health Care Fraud Scheme
The former chief operating officer of a Miami-area hospital pleaded guilty today for his role in a mental health care fraud scheme that resulted in the submission of more than $67 million in fraudulent claims to Medicare by a state-licensed psychiatric hospital located in Hollywood, Florida, that purported to offer both inpatient and outpatient mental health services.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Derrick Jackson of the U.S. Health and Human Services Office of Inspector General’s (HHS-OIG) Florida region made the announcement.
Christopher Gabel, 61, of Davie, Florida, the former Chief Operating Officer (COO) of Hollywood Pavilion LLC (HP), pleaded guilty before U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida to one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States and pay and receive health care kickbacks. Gabel was charged in an indictment returned on May 8, 2014.
According to Gabel’s admissions in connection with his guilty plea, between April 2003 and September 2012, HP submitted false and fraudulent claims to Medicare for treatment that was not medically necessary or not provided to patients. As COO during that time, Gabel supervised HP’s staff at both its inpatient and outpatient facilities, where Medicare beneficiaries were admitted to HP regardless of whether they qualified for mental health treatment, and were often admitted before seeing a doctor.
Gabel admitted that HP obtained Medicare beneficiaries from across the country by paying bribes and kickbacks to various patient brokers. Gabel instructed the patient brokers to falsify invoices and marketing reports in an effort to hide, and cover up the true nature of the bribes and kickbacks they were receiving from HP. From 2003 through August 2012, HP billed Medicare approximately $67 million for services that were not properly rendered, for patients that did not qualify for the services being billed, and for claims for patients who were procured through bribes and kickbacks. Medicare reimbursed HP nearly $40 million for those claims.
Karen Kallen-Zury, Daisy Miller, Michele Petrie and Christian Coloma were convicted at trial in June 2013 for their roles in this scheme. Kallen-Zury, HP’s former chief executive officer, was sentenced to 25 years in prison. Miller, the clinical director of HP’s inpatient facility, was sentenced to 15 years in prison; and Petrie, the head of HP’s intensive outpatient program, was sentenced to six years in prison. Coloma, the director of physical therapy for an entity associated with HP, was sentenced to 12 years in prison. Kallen-Zury, Miller and Petrie were ordered to pay nearly $40 million in restitution, and Coloma was ordered to pay more than $20 million in restitution.
The case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. The case is being prosecuted by Trial Attorneys Nicholas E. Surmacz, Andrew H. Warren and L. Rush Atkinson of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
CHAIRMAN EXP-IM BANK SIGNS $1 BILLION MEMORANDUM OF UNDERSTANDING SUPPORTING CLEAN ENERGY EXPORTS TO INDIA
FROM: U.S. EXPORT-IMPORT BANK
Ex-Im Bank Chairman Hochberg Signs $1 Billion Memorandum of Understanding to Support U.S. Clean Energy Exports to India
Announces the MOU at the India-US Technology Summit in Noida
Washington, D.C. – Today, Export-Import Bank of the United States (Ex-Im Bank) Chairman Fred P. Hochberg signed a Memorandum of Understanding with Chairman K.S. Popli of the Indian Renewable Energy Development Agency (IREDA) that will explore options for utilizing up to $1 billion to finance the sale of U.S. clean energy exports to India.
Chairman Hochberg is visiting India this week to promote made-in-America exports in support of U.S. jobs.
The availability of Ex-Im Bank financing could translate into support for skilled jobs in the U.S. renewable energy sector while contributing to the Indian government’s recently-announced goal of providing 24-hour electricity to India’s 1.3 billion citizens by 2019, much of it set to come from renewable sources. In fact, Ex-Im Bank has authorized $353.4 million for U.S. renewable energy exports to India since 2009, and Ex-Im Bank was one of the top financiers of projects under the National Solar Mission Phase 1.
“When quality, reliable U.S. goods and services are brought to bear in high-demand markets like India, the benefits are felt in both of our countries,” said Chairman Hochberg. “This Memorandum of Understanding will reinforce the strong ties that America and India already share, create good-paying jobs on both of our shores, and further invigorate America’s clean energy industry while equipping India to meet its own ambitious energy goals.”
After signing the Memorandum, Chairman Hochberg travelled to Noida, India to attend and give remarks at the India-US Technology Summit. During his remarks, Chairman Hochberg highlighted the renewable energy MOU as evidence of the mutual benefits that can be realized by choosing quality U.S. goods.
India ranks as the second-largest destination for U.S. exports supported by Ex-Im Bank financing, and claims more than $7.2 billion of the Bank’s credit exposure through FY 2014. Over the last five years, Ex-Im Bank has authorized an average of $1.4 billion per year to finance U.S. exports to India.
Ex-Im Bank Chairman Hochberg Signs $1 Billion Memorandum of Understanding to Support U.S. Clean Energy Exports to India
Announces the MOU at the India-US Technology Summit in Noida
Washington, D.C. – Today, Export-Import Bank of the United States (Ex-Im Bank) Chairman Fred P. Hochberg signed a Memorandum of Understanding with Chairman K.S. Popli of the Indian Renewable Energy Development Agency (IREDA) that will explore options for utilizing up to $1 billion to finance the sale of U.S. clean energy exports to India.
Chairman Hochberg is visiting India this week to promote made-in-America exports in support of U.S. jobs.
The availability of Ex-Im Bank financing could translate into support for skilled jobs in the U.S. renewable energy sector while contributing to the Indian government’s recently-announced goal of providing 24-hour electricity to India’s 1.3 billion citizens by 2019, much of it set to come from renewable sources. In fact, Ex-Im Bank has authorized $353.4 million for U.S. renewable energy exports to India since 2009, and Ex-Im Bank was one of the top financiers of projects under the National Solar Mission Phase 1.
“When quality, reliable U.S. goods and services are brought to bear in high-demand markets like India, the benefits are felt in both of our countries,” said Chairman Hochberg. “This Memorandum of Understanding will reinforce the strong ties that America and India already share, create good-paying jobs on both of our shores, and further invigorate America’s clean energy industry while equipping India to meet its own ambitious energy goals.”
After signing the Memorandum, Chairman Hochberg travelled to Noida, India to attend and give remarks at the India-US Technology Summit. During his remarks, Chairman Hochberg highlighted the renewable energy MOU as evidence of the mutual benefits that can be realized by choosing quality U.S. goods.
India ranks as the second-largest destination for U.S. exports supported by Ex-Im Bank financing, and claims more than $7.2 billion of the Bank’s credit exposure through FY 2014. Over the last five years, Ex-Im Bank has authorized an average of $1.4 billion per year to finance U.S. exports to India.
COMMITTEE STUDYING VIOLENCE EXPOSURE OF NATIVE AMERICAN AND ALASKA NATIVE CHILDREN MAKES RECOMMENDATIONS
FROM: U.S. JUSTICE DEPARTMENT
Tuesday, November 18, 2014
Committee Studying American Indian and Alaska Native Children Exposed to Violence Makes Recommendations to Justice Department
The Advisory Committee of the Attorney General’s Task Force on American Indian and Alaska Native Children Exposed to Violence released policy recommendations to the Justice Department today.
The report recommends a significant rebuilding of the current services provided to Indian Country, through increased partnering and coordination with tribes, and increased funding for programs to support American Indian and Alaska Native children. Each of the five chapters discusses the Advisory Committee’s findings and recommendations. The report provides the Advisory Committee’s vision for the development of effective, trauma informed, and culturally appropriate programs and services to protect American Indian and Alaska Native children exposed to violence.
“American Indian and Alaska Native children represent the future, and they face unprecedented challenges, including an unacceptable level of exposure to violence, which we know can have lasting and traumatic effects on body and mind,” said Attorney General Eric Holder. “We must understand these impacts well so we can pursue policies that bring meaningful change. That’s why I am deeply grateful for the work of this advisory committee and the continuing mission of this task force.”
Attorney General Eric Holder created the task force in 2013. It is composed of a federal working group that includes U.S. Attorneys and officials from the Interior and Justice Departments and a federal advisory committee of experts on American Indian studies, child health and trauma, victim services and child welfare. Former U.S. Sen. Byron Dorgan and Iroquois composer, singer and child advocate Joanne Shenandoah co-chaired the 13-member committee.
These recommendations are a culmination of the research and information gathered through four public hearings held between December 2013 and June 2014 in Bismarck, North Dakota; Scottsdale, Arizona; Fort Lauderdale, Florida; and Anchorage, Alaska, and five listening sessions in Arizona, Minneapolis and Alaska where over 600 people participated from over 62 Tribes and 15 States from across the nation. More than 70 experts and 60 community members testified at the hearings, addressing domestic and community violence in Indian Country; the pathway from victimization to the juvenile justice system; the roles of juvenile courts, detention facilities and the child welfare system; gang violence; and child sex trafficking.
The Task Force on American Indian and Alaska Native Children Exposed to Violence is part of the Attorney General’s Defending Childhood initiative. The task force is also a component of the Justice Department’s ongoing collaboration with leaders in American Indian and Alaska Native communities to improve public safety.
Tuesday, November 18, 2014
Committee Studying American Indian and Alaska Native Children Exposed to Violence Makes Recommendations to Justice Department
The Advisory Committee of the Attorney General’s Task Force on American Indian and Alaska Native Children Exposed to Violence released policy recommendations to the Justice Department today.
The report recommends a significant rebuilding of the current services provided to Indian Country, through increased partnering and coordination with tribes, and increased funding for programs to support American Indian and Alaska Native children. Each of the five chapters discusses the Advisory Committee’s findings and recommendations. The report provides the Advisory Committee’s vision for the development of effective, trauma informed, and culturally appropriate programs and services to protect American Indian and Alaska Native children exposed to violence.
“American Indian and Alaska Native children represent the future, and they face unprecedented challenges, including an unacceptable level of exposure to violence, which we know can have lasting and traumatic effects on body and mind,” said Attorney General Eric Holder. “We must understand these impacts well so we can pursue policies that bring meaningful change. That’s why I am deeply grateful for the work of this advisory committee and the continuing mission of this task force.”
Attorney General Eric Holder created the task force in 2013. It is composed of a federal working group that includes U.S. Attorneys and officials from the Interior and Justice Departments and a federal advisory committee of experts on American Indian studies, child health and trauma, victim services and child welfare. Former U.S. Sen. Byron Dorgan and Iroquois composer, singer and child advocate Joanne Shenandoah co-chaired the 13-member committee.
These recommendations are a culmination of the research and information gathered through four public hearings held between December 2013 and June 2014 in Bismarck, North Dakota; Scottsdale, Arizona; Fort Lauderdale, Florida; and Anchorage, Alaska, and five listening sessions in Arizona, Minneapolis and Alaska where over 600 people participated from over 62 Tribes and 15 States from across the nation. More than 70 experts and 60 community members testified at the hearings, addressing domestic and community violence in Indian Country; the pathway from victimization to the juvenile justice system; the roles of juvenile courts, detention facilities and the child welfare system; gang violence; and child sex trafficking.
The Task Force on American Indian and Alaska Native Children Exposed to Violence is part of the Attorney General’s Defending Childhood initiative. The task force is also a component of the Justice Department’s ongoing collaboration with leaders in American Indian and Alaska Native communities to improve public safety.
SEC CHARGES 3 STOCK PROMOTERS IN ALLEGED PUMP-AND-DUMP SCHEME
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
The Securities and Exchange Commission charged three penny stock promoters with conducting pump-and-dump schemes involving stocks they were touting in their supposedly independent newsletters.
The SEC alleges that Anthony Thompson, Jay Fung, and Eric Van Nguyen worked in coordinated fashion to gain control of a large portion of shares in the stock of microcap companies and then hyped those stocks in newsletters they distributed to prospective investors. After creating demand for the stock and increasing the value, they sold their holdings at the higher prices and earned significant profits. Once they stopped their promotional efforts, the demand for the stocks subsided and the prices dropped, leaving investors who had purchased the promoters’ shares with significant losses.
According to the SEC’s complaint filed in federal court in Manhattan, the newsletters published by Thompson, Fung, and Van Nguyen misleadingly stated that they “may” or “might” sell shares they owned when in reality their intentions always were to sell the stocks they were promoting. In fact, in some instances they already were selling the stocks to which they were saying “may” or “might” sell. They also failed to fully disclose in their newsletters the amounts of compensation they were receiving for promoting the stocks, cloaking the fact that they were coordinating their promotion of the penny stocks to deliberately increase the prices and dump their own shares.
“Investors should be very wary of penny stock promotions like these, which promise quick and vast riches to those who are purportedly lucky enough to invest,” said Andrew M. Calamari, Director of the SEC’s New York Regional Office. “In this case, the promoters violated a specific legal requirement that they accurately disclose all compensation they were receiving for promoting the stock and the fact that they were simultaneously selling the stock while urging the investing public to buy it.”
According to the SEC’s complaint, the three promoters conducted five separate schemes that resulted in more than $10 million in ill-gotten gains. The penny stocks they manipulated were Blast Applications Inc., Smart Holdings Inc., Blue Gem Enterprise Inc., Lyric Jeans Inc., and Mass Hysteria Entertainment Company Inc. Thompson, who lives in Bethesda, Md., distributed several electronic penny stock promotion newsletters with such names as FreeInvestmentReport.com and OxofWallStreet.com. Fung, who resides in Delray Beach, Fla., distributed his newsletters at such websites as PennyPic.com, and Van Nguyen was typically based in Canada and distributed electronic penny stock promotion newsletters on such websites as UnrealStocks.com and InsanePicks.com.
“Thompson, Fung, and Van Nguyen repeatedly staged coordinated promotional campaigns to manipulate stock prices and score their own paydays while defrauding investors,” said Sanjay Wadhwa, Senior Associate Director for Enforcement in the SEC’s New York Regional Office.
The SEC’s complaint names two relief defendants for the purposes of recovering money in their possession that resulted from the schemes. Thompson’s wife Kendall Thompson received $200,000 in proceeds from one of the stock manipulation schemes. John Babikian, who operated a penny stock promotion business primarily from a website named AwesomePennyStocks.com, received $1 million as a result of one of the schemes. In a separate SEC case involving a different scheme, a court ordered $3.73 million in sanctions against Babikian.
The SEC’s complaint charges Thompson, Fung, and Van Nguyen with violating the antifraud and anti-touting provisions of the federal securities laws and related rules. The SEC is seeking disgorgement of ill-gotten gains from the schemes plus prejudgment interest and penalties as well as permanent injunctions against further violations of the securities laws.
Thompson and Fung also were named in a separate SEC case for their roles in a Florida-based scheme in which they promoted a penny stock in their newsletters without adequately disclosing they were selling their shares in the same stock and receiving compensation for their promotional efforts. A court issued a final judgment requiring them to pay more than $1 million combined.
The SEC’s investigation was conducted by Peter Pizzani, Timothy Nealon, Michael Osnato, and Thomas P. Smith Jr. of the SEC’s New York Regional Office, and the case was supervised by Mr. Wadhwa. The SEC’s litigation will be led by Howard A. Fischer. The SEC appreciates the assistance of the Manhattan District Attorney’s Office and the Financial Industry Regulatory Authority.
The Securities and Exchange Commission charged three penny stock promoters with conducting pump-and-dump schemes involving stocks they were touting in their supposedly independent newsletters.
The SEC alleges that Anthony Thompson, Jay Fung, and Eric Van Nguyen worked in coordinated fashion to gain control of a large portion of shares in the stock of microcap companies and then hyped those stocks in newsletters they distributed to prospective investors. After creating demand for the stock and increasing the value, they sold their holdings at the higher prices and earned significant profits. Once they stopped their promotional efforts, the demand for the stocks subsided and the prices dropped, leaving investors who had purchased the promoters’ shares with significant losses.
According to the SEC’s complaint filed in federal court in Manhattan, the newsletters published by Thompson, Fung, and Van Nguyen misleadingly stated that they “may” or “might” sell shares they owned when in reality their intentions always were to sell the stocks they were promoting. In fact, in some instances they already were selling the stocks to which they were saying “may” or “might” sell. They also failed to fully disclose in their newsletters the amounts of compensation they were receiving for promoting the stocks, cloaking the fact that they were coordinating their promotion of the penny stocks to deliberately increase the prices and dump their own shares.
“Investors should be very wary of penny stock promotions like these, which promise quick and vast riches to those who are purportedly lucky enough to invest,” said Andrew M. Calamari, Director of the SEC’s New York Regional Office. “In this case, the promoters violated a specific legal requirement that they accurately disclose all compensation they were receiving for promoting the stock and the fact that they were simultaneously selling the stock while urging the investing public to buy it.”
According to the SEC’s complaint, the three promoters conducted five separate schemes that resulted in more than $10 million in ill-gotten gains. The penny stocks they manipulated were Blast Applications Inc., Smart Holdings Inc., Blue Gem Enterprise Inc., Lyric Jeans Inc., and Mass Hysteria Entertainment Company Inc. Thompson, who lives in Bethesda, Md., distributed several electronic penny stock promotion newsletters with such names as FreeInvestmentReport.com and OxofWallStreet.com. Fung, who resides in Delray Beach, Fla., distributed his newsletters at such websites as PennyPic.com, and Van Nguyen was typically based in Canada and distributed electronic penny stock promotion newsletters on such websites as UnrealStocks.com and InsanePicks.com.
“Thompson, Fung, and Van Nguyen repeatedly staged coordinated promotional campaigns to manipulate stock prices and score their own paydays while defrauding investors,” said Sanjay Wadhwa, Senior Associate Director for Enforcement in the SEC’s New York Regional Office.
The SEC’s complaint names two relief defendants for the purposes of recovering money in their possession that resulted from the schemes. Thompson’s wife Kendall Thompson received $200,000 in proceeds from one of the stock manipulation schemes. John Babikian, who operated a penny stock promotion business primarily from a website named AwesomePennyStocks.com, received $1 million as a result of one of the schemes. In a separate SEC case involving a different scheme, a court ordered $3.73 million in sanctions against Babikian.
The SEC’s complaint charges Thompson, Fung, and Van Nguyen with violating the antifraud and anti-touting provisions of the federal securities laws and related rules. The SEC is seeking disgorgement of ill-gotten gains from the schemes plus prejudgment interest and penalties as well as permanent injunctions against further violations of the securities laws.
Thompson and Fung also were named in a separate SEC case for their roles in a Florida-based scheme in which they promoted a penny stock in their newsletters without adequately disclosing they were selling their shares in the same stock and receiving compensation for their promotional efforts. A court issued a final judgment requiring them to pay more than $1 million combined.
The SEC’s investigation was conducted by Peter Pizzani, Timothy Nealon, Michael Osnato, and Thomas P. Smith Jr. of the SEC’s New York Regional Office, and the case was supervised by Mr. Wadhwa. The SEC’s litigation will be led by Howard A. Fischer. The SEC appreciates the assistance of the Manhattan District Attorney’s Office and the Financial Industry Regulatory Authority.
Wednesday, November 19, 2014
U.S. CONGRATULATES PEOPLE OF MONACO ON THEIR NATIONAL DAY
FROM: U.S. STATE DEPARTMENT
Statement on the Occasion of Monaco's National Day
Press Statement
John Kerry
Secretary of State
Washington, DC
November 18, 2014
On behalf of President Obama and the people of the United States, I congratulate the people of Monaco as you celebrate your 158th National Day, la Fête du Prince, on November 19.
The United States and Monaco have enjoyed a long and productive relationship, made possible by the person-to-person bonds that unite the American and Monégasque people.
I am particularly grateful for Monaco’s participation in the “Our Ocean Conference” on June 16, and for His Serene Highness Prince Albert II’s keynote remarks. Prince Albert is a leading voice in the global effort to protect our environment and stop the march of climate change. I commend all of Monaco for your unwavering commitment to environmental issues.
We also look forward to continuing to work with you on other vital issues such as marine pollution, women and children’s rights, and education.
On this special occasion, I send best wishes for peace and prosperity in the year ahead.
Statement on the Occasion of Monaco's National Day
Press Statement
John Kerry
Secretary of State
Washington, DC
November 18, 2014
On behalf of President Obama and the people of the United States, I congratulate the people of Monaco as you celebrate your 158th National Day, la Fête du Prince, on November 19.
The United States and Monaco have enjoyed a long and productive relationship, made possible by the person-to-person bonds that unite the American and Monégasque people.
I am particularly grateful for Monaco’s participation in the “Our Ocean Conference” on June 16, and for His Serene Highness Prince Albert II’s keynote remarks. Prince Albert is a leading voice in the global effort to protect our environment and stop the march of climate change. I commend all of Monaco for your unwavering commitment to environmental issues.
We also look forward to continuing to work with you on other vital issues such as marine pollution, women and children’s rights, and education.
On this special occasion, I send best wishes for peace and prosperity in the year ahead.
U.S. CONGRATULATES PEOPLE OF LATVIA ON THEIR INDEPENDENCE DAY
FROM: U.S. STATE DEPARTMENT
Statement on the Occasion of Latvia's National Day
Press Statement
John Kerry
Secretary of State
Washington, DC
November 17, 2014
On behalf of President Obama and the people of the United States, I congratulate the people of Latvia on the 96th anniversary of your independence on November 18.
Earlier this year, the United states joined with you to honor the 25th anniversary of the Baltic Way. We remembered watching in awe as millions of Latvians, Estonians, and Lithuanians linked arms and formed a human chain hundreds of miles long -- connecting Riga, Tallinn, and Vilnius. It was an inspiring act of humanity, one that gave hope to millions of people living under the Iron Curtain.
Today, your unbreakable spirit, determination, and entrepreneurial character are the foundations of your success. You are an example for people around the world who want to be free.
As NATO Allies, the United States remains committed to Latvia's security. We are proud to work closely with you to advance issues including energy security, the Transatlantic Trade and Investment Partnership, and stopping human trafficking.
We look forward to deepening our Transatlantic partnership as Latvia prepares to take over the rotating Presidency of the Council of the European Union this January.
As you celebrate this day, please know that the United States will always stand with you as a faithful friend and ally.
Statement on the Occasion of Latvia's National Day
Press Statement
John Kerry
Secretary of State
Washington, DC
November 17, 2014
On behalf of President Obama and the people of the United States, I congratulate the people of Latvia on the 96th anniversary of your independence on November 18.
Earlier this year, the United states joined with you to honor the 25th anniversary of the Baltic Way. We remembered watching in awe as millions of Latvians, Estonians, and Lithuanians linked arms and formed a human chain hundreds of miles long -- connecting Riga, Tallinn, and Vilnius. It was an inspiring act of humanity, one that gave hope to millions of people living under the Iron Curtain.
Today, your unbreakable spirit, determination, and entrepreneurial character are the foundations of your success. You are an example for people around the world who want to be free.
As NATO Allies, the United States remains committed to Latvia's security. We are proud to work closely with you to advance issues including energy security, the Transatlantic Trade and Investment Partnership, and stopping human trafficking.
We look forward to deepening our Transatlantic partnership as Latvia prepares to take over the rotating Presidency of the Council of the European Union this January.
As you celebrate this day, please know that the United States will always stand with you as a faithful friend and ally.
SECRETARY HAGEL SAYS RUSSIA'S ACTIONS "DANGEROUS AND IRRESPONSIBLE"
Right: Defense Secretary Chuck Hagel talks to U.S. Marines assigned to the 2nd Marine Expeditionary Force (Forward) on Camp LeJeune, N.C., Nov. 18. 2014. DoD Photo by U.S. Marine Corps Sgt. Cassandra Flowers
Secretary: Russia’s Actions ‘Dangerous And Irresponsible’
By Nick Simeone
DoD News, Defense Media Activity
WASHINGTON, Nov. 18, 2014 – Defense Secretary Chuck Hagel today called Russia’s actions in Ukraine “dangerous and irresponsible” and said the tensions provoked by Moscow have probably done more to unify NATO than anything else in years.
“It has brought the world together in a way where they are isolating themselves by their actions,” Hagel said of Russia, as he took questions from Marines during a visit to North Carolina’s Camp Lejeune.
‘Very Dangerous’ Actions
One service member asked the defense secretary if he envisioned the United States becoming more involved in the Russia-Ukraine conflict. Russia’s actions toward Ukraine, as well as stepped-up Russian military air flights over European airspace and plans for similar flights over the Gulf of Mexico are “very dangerous,” Hagel said.
“The violations of sovereignty and international law that the Russians have perpetuated continue to require responses,” the defense secretary said. The United States is working with NATO “in shifting our entire rotational rapid deployment focus,” he added.
U.S. European Command chief Air Force Gen. Philip M. Breedlove , who is also NATO’s supreme allied commander for Europe, has said Russian military equipment continues to flow across the border into Ukraine, something Russia denies.
CANADIAN CEO EXTRADITED IN CASE INVOLVING NEW JERSEY SUPERFUND SITE
FROM: U.S. JUSTICE DEPARTMENT
Monday, November 17, 2014
Canadian Executive Extradited on Major Fraud Charges Involving a New Jersey Environmental Protection Agency Superfund Site
John Bennett, a Canadian national, was extradited Friday from Canada on a charge of participating in a conspiracy to pay kickbacks and commit fraud at the U.S. Environmental Protection Agency (EPA)-designated Superfund site Federal Creosote, located in Manville, New Jersey. He was also charged with a related count for major fraud against the United States related to contracts obtained at the Federal Creosote site, the Department of Justice announced today.
Bennett was the former Chief Executive Officer with Bennett Environmental Inc., a Canadian-based company that treated and disposed of contaminated soil. According to a felony indictment filed in the U.S. District Court for the District of New Jersey on Aug. 31, 2009 Bennett carried out the conspiracy by providing kickbacks to Gordon McDonald, the project manager at the Federal Creosote site, in order to influence the award of sub-contracts at the site and inflate the prices charged to the EPA by the prime contractor. The kickbacks were in the form of money transferred by wire to a co-conspirator’s shell company, lavish cruises for senior officials of the prime contractor, and various entertainment tickets. The department said the conspiracy began at least as early as December 2001 and continued until approximately August 2004.
The clean-up at Federal Creosote is partly funded by the EPA. Under an interagency agreement between the EPA and the Army Corps of Engineers, prime contractors oversaw the removal, treatment and disposal of contaminated soil as well as other operations at the Federal Creosote site.
Bennett arrived in the District of New Jersey, in Newark, on Nov. 14, 2014 and made his initial appearance today in the U.S. District Court for the District of New Jersey in Newark.
“The defendant is charged with thwarting the government’s competitive contracting practices,” said Assistant Attorney General Bill Baer of the Department of Justice’s Antitrust Division. “This extradition demonstrates our resolve to pursue those who undermine competition. And it is yet another example of our longstanding cooperation with our enforcement colleagues in Canada’s Department of Justice, which helps ensure that those who subvert competition in the United States and elsewhere are brought to justice.”
The fraud conspiracy that Bennett is charged with carries a maximum penalty of five years in prison and a $250,000 fine. The major fraud against the United States charge carries a maximum penalty of 10 years in prison and a $1 million criminal fine for individuals. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
As a result of the department’s investigation, three companies, including Bennett Environmental Inc., and eight individuals have pleaded guilty. Bennett’s co-conspirator, Gordon McDonald, was convicted on Sept. 30, 2013, on 10 counts, including the two charges pending against Bennett. McDonald was sentenced on March 4, 2014 to a 14-year term of imprisonment.
The investigation was conducted by the Antitrust Division’s New York Field Office, the EPA Office of Inspector General and the Internal Revenue Service Criminal Investigation with assistance from the Antitrust Division’s Foreign Commerce Section and the Criminal Division’s Office of International Affairs.
Monday, November 17, 2014
Canadian Executive Extradited on Major Fraud Charges Involving a New Jersey Environmental Protection Agency Superfund Site
John Bennett, a Canadian national, was extradited Friday from Canada on a charge of participating in a conspiracy to pay kickbacks and commit fraud at the U.S. Environmental Protection Agency (EPA)-designated Superfund site Federal Creosote, located in Manville, New Jersey. He was also charged with a related count for major fraud against the United States related to contracts obtained at the Federal Creosote site, the Department of Justice announced today.
Bennett was the former Chief Executive Officer with Bennett Environmental Inc., a Canadian-based company that treated and disposed of contaminated soil. According to a felony indictment filed in the U.S. District Court for the District of New Jersey on Aug. 31, 2009 Bennett carried out the conspiracy by providing kickbacks to Gordon McDonald, the project manager at the Federal Creosote site, in order to influence the award of sub-contracts at the site and inflate the prices charged to the EPA by the prime contractor. The kickbacks were in the form of money transferred by wire to a co-conspirator’s shell company, lavish cruises for senior officials of the prime contractor, and various entertainment tickets. The department said the conspiracy began at least as early as December 2001 and continued until approximately August 2004.
The clean-up at Federal Creosote is partly funded by the EPA. Under an interagency agreement between the EPA and the Army Corps of Engineers, prime contractors oversaw the removal, treatment and disposal of contaminated soil as well as other operations at the Federal Creosote site.
Bennett arrived in the District of New Jersey, in Newark, on Nov. 14, 2014 and made his initial appearance today in the U.S. District Court for the District of New Jersey in Newark.
“The defendant is charged with thwarting the government’s competitive contracting practices,” said Assistant Attorney General Bill Baer of the Department of Justice’s Antitrust Division. “This extradition demonstrates our resolve to pursue those who undermine competition. And it is yet another example of our longstanding cooperation with our enforcement colleagues in Canada’s Department of Justice, which helps ensure that those who subvert competition in the United States and elsewhere are brought to justice.”
The fraud conspiracy that Bennett is charged with carries a maximum penalty of five years in prison and a $250,000 fine. The major fraud against the United States charge carries a maximum penalty of 10 years in prison and a $1 million criminal fine for individuals. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
As a result of the department’s investigation, three companies, including Bennett Environmental Inc., and eight individuals have pleaded guilty. Bennett’s co-conspirator, Gordon McDonald, was convicted on Sept. 30, 2013, on 10 counts, including the two charges pending against Bennett. McDonald was sentenced on March 4, 2014 to a 14-year term of imprisonment.
The investigation was conducted by the Antitrust Division’s New York Field Office, the EPA Office of Inspector General and the Internal Revenue Service Criminal Investigation with assistance from the Antitrust Division’s Foreign Commerce Section and the Criminal Division’s Office of International Affairs.
EXPORT-IMPORT BANK CHAIRMAN PROMOTES U.S. EXPORTS TO INDIA
FROM: U.S. EXPORT-IMPORT BANK
Ex-Im Bank Chairman Hochberg Visits India to Promote Made-in-America Exports
Washington, D.C. – Export-Import Bank of the U.S. (Ex-Im Bank) Chairman Fred P. Hochberg is visiting India this week to promote made-in-America exports in support of U.S. jobs.
“The U.S. and India share complementary aspirations when it comes to our economic future,” said Chairman Hochberg. “When quality American goods and services are deployed to buyers in India, their nation benefits from increased capacity and a reliable foundation for long-term economic growth—and the U.S. benefits by creating new jobs back home.”
Today, Chairman Hochberg delivered comments at a roundtable hosted by the U.S.-India Business Council, where he discussed energy growth, especially when it comes to the renewable energy sector, and infrastructure expansion in India and what role U.S. companies can play in both. He also addressed similar subjects at the Federation of Indian Chambers of Commerce and Industry later in the day.
In addition, Chairman Hochberg held a lunch with Indian businesswomen, to learn more about the challenges and opportunities they have in starting and growing a business in the country.
Throughout his trip, Chairman Hochberg has also taken the opportunity to highlight how Ex-Im Bank’s financing tools have enabled American businesses both large and small to export their products to India.
Some examples include:
Polyguard, of Ennis, Texas, employs 120 people and manufactures corrosion-preventing and waterproof linings for industrial processes and pipelines. The company utilizes Ex-Im trade credit insurance and is exporting to 34 countries. Since making use of Ex-Im insurance, the company’s export sales have increased by more than 230 percent.
Preferred Popcorn of Chapman, Nebraska is a small-business vendor that exports popcorn, concessions supplies, and coconut oil to India and other international markets. Started in 1998, the company currently employs 40 people in Nebraska, Indiana, Illinois, Ohio, and Kentucky. Since its founding, the company has relied upon Ex-Im Bank products and now fills orders in 60 countries around the globe. As a consistent policy holder of Ex-Im Bank export credit insurance, Preferred Popcorn has watched its sales mount to $43 million, 50 percent of which are export-related. Moreover, Ex-Im Bank support has translated into approximately 25 new jobs.
Tomorrow, Chairman Hochberg will attend and give keynote remarks at the India-U.S. Technology Summit. The Summit will be an opportunity for businesses, research institutions and government agencies from both countries to exchange ideas and forge new partnerships to increase trade and investment in the knowledge sector. Chairman Hochberg’s remarks will focus on the mutual benefits that can be realized by choosing quality U.S. goods and American innovation.
Ex-Im Bank Chairman Hochberg Visits India to Promote Made-in-America Exports
Washington, D.C. – Export-Import Bank of the U.S. (Ex-Im Bank) Chairman Fred P. Hochberg is visiting India this week to promote made-in-America exports in support of U.S. jobs.
“The U.S. and India share complementary aspirations when it comes to our economic future,” said Chairman Hochberg. “When quality American goods and services are deployed to buyers in India, their nation benefits from increased capacity and a reliable foundation for long-term economic growth—and the U.S. benefits by creating new jobs back home.”
Today, Chairman Hochberg delivered comments at a roundtable hosted by the U.S.-India Business Council, where he discussed energy growth, especially when it comes to the renewable energy sector, and infrastructure expansion in India and what role U.S. companies can play in both. He also addressed similar subjects at the Federation of Indian Chambers of Commerce and Industry later in the day.
In addition, Chairman Hochberg held a lunch with Indian businesswomen, to learn more about the challenges and opportunities they have in starting and growing a business in the country.
Throughout his trip, Chairman Hochberg has also taken the opportunity to highlight how Ex-Im Bank’s financing tools have enabled American businesses both large and small to export their products to India.
Some examples include:
Polyguard, of Ennis, Texas, employs 120 people and manufactures corrosion-preventing and waterproof linings for industrial processes and pipelines. The company utilizes Ex-Im trade credit insurance and is exporting to 34 countries. Since making use of Ex-Im insurance, the company’s export sales have increased by more than 230 percent.
Preferred Popcorn of Chapman, Nebraska is a small-business vendor that exports popcorn, concessions supplies, and coconut oil to India and other international markets. Started in 1998, the company currently employs 40 people in Nebraska, Indiana, Illinois, Ohio, and Kentucky. Since its founding, the company has relied upon Ex-Im Bank products and now fills orders in 60 countries around the globe. As a consistent policy holder of Ex-Im Bank export credit insurance, Preferred Popcorn has watched its sales mount to $43 million, 50 percent of which are export-related. Moreover, Ex-Im Bank support has translated into approximately 25 new jobs.
Tomorrow, Chairman Hochberg will attend and give keynote remarks at the India-U.S. Technology Summit. The Summit will be an opportunity for businesses, research institutions and government agencies from both countries to exchange ideas and forge new partnerships to increase trade and investment in the knowledge sector. Chairman Hochberg’s remarks will focus on the mutual benefits that can be realized by choosing quality U.S. goods and American innovation.
SEC SANCTIONS TWO FORMER DEFENSE CONTRACTOR EMPLOYEES FOR FOREIGN CORRUPT PRACTICES ACT VIOLATIONS
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
November 17, 2014
The Securities and Exchange Commission sanctioned two former employees in the Dubai office of a U.S.-based defense contractor for violating the Foreign Corrupt Practices Act (FCPA) by taking government officials in Saudi Arabia on a “world tour” to help secure business for the company. The two employees later falsified records in an attempt to hide their misconduct.
Stephen Timms and Yasser Ramahi, who worked in sales at FLIR Systems Inc., agreed to settle the SEC’s charges and pay financial penalties. The SEC’s investigation is continuing.
“This case shows we will pursue employees of public companies who think it is acceptable to buy foreign officials’ loyalty with lavish gifts and travel,” said Andrew J. Ceresney, Director of the SEC Enforcement Division. “By making illegal payments and causing them to be recorded improperly, employees expose not only their firms but also themselves to an enforcement action.”
FLIR is headquartered in Oregon and produces thermal imaging, night vision, and infrared cameras and sensor systems. According to the SEC’s order instituting a settled administrative proceeding, FLIR entered into a multi-million dollar contract to provide thermal binoculars to the Saudi government in November 2008. Timms and Ramahi were the primary sales employees responsible for the contract, and also were involved in negotiations to sell FLIR’s security cameras to the same government officials. At the time, Timms was the head of FLIR’s Middle East office in Dubai and Ramahi reported to him.
The SEC’s order finds that Timms and Ramahi traveled to Saudi Arabia in March 2009 and provided five officials with expensive luxury watches during meetings to discuss several business opportunities. Timms and Ramahi believed these officials were important to sales of both the binoculars and the security cameras. A few months later, they arranged for key officials, including two who received watches, to embark on what Timms referred to as a “world tour” of personal travel before and after they visited FLIR’s Boston facilities for a factory equipment inspection that was a key condition to fulfillment of the contract. The officials traveled for 20 nights with stops in Casablanca, Paris, Dubai, Beirut, and New York City. There was no business purpose for the stops outside of Boston, and the airfare and hotel accommodations were paid for by FLIR. Prior to providing the gifts and travel to the Saudi Arabian officials, Ramahi and Timms each had taken FCPA training at the company that specifically identified luxury watches and side trips as prohibited gifts.
According to the SEC’s order, when FLIR’s finance department flagged the expense reimbursement request for the watches during an unrelated review of expenses in the Dubai office and questioned the $7,000 cost, Timms and Ramahi obtained a second, fabricated invoice showing a cost of 7,000 Saudi Riyal (approximately $1,900 in U.S. dollars) instead of the true cost of $7,000 in U.S. dollars. They directed FLIR’s local third-party agent to provide false information to the company to back up their story that the original submission was merely a mistake. Ramahi and Timms also falsely claimed that FLIR’s payment for the world tour had been a billing mistake by FLIR’s travel agent, and again used false documentation and FLIR’s third-party agent to bolster their cover-up efforts.
Timms and Ramahi are U.S. citizens who reside in Thailand and the United Arab Emirates respectively. The SEC’s order finds that they violated the anti-bribery provisions of Section 30A of the Securities Exchange Act of 1934 and the internal controls and false records provisions of Section 13(b)(5) and Rule 13b2-1 of the Exchange Act. The SEC’s order further finds that Timms and Ramahi caused FLIR’s violations of the books and records provisions of Section 13(b)(2)(A) of the Exchange Act. Without admitting or denying the findings, Timms and Ramahi consented to the entry of the order and agreed to pay financial penalties of $50,000 and $20,000 respectively.
The SEC’s investigation is being conducted by FCPA Unit members Cameron P. Hoffman and Tracy L. Davis in the San Francisco office. The SEC appreciates the assistance of the Justice Department’s Fraud Section, the U.S. Attorney’s Office for the District of Massachusetts, the Federal Bureau of Investigation, and the United Arab Emirates Securities and Commodities Authority.
November 17, 2014
The Securities and Exchange Commission sanctioned two former employees in the Dubai office of a U.S.-based defense contractor for violating the Foreign Corrupt Practices Act (FCPA) by taking government officials in Saudi Arabia on a “world tour” to help secure business for the company. The two employees later falsified records in an attempt to hide their misconduct.
Stephen Timms and Yasser Ramahi, who worked in sales at FLIR Systems Inc., agreed to settle the SEC’s charges and pay financial penalties. The SEC’s investigation is continuing.
“This case shows we will pursue employees of public companies who think it is acceptable to buy foreign officials’ loyalty with lavish gifts and travel,” said Andrew J. Ceresney, Director of the SEC Enforcement Division. “By making illegal payments and causing them to be recorded improperly, employees expose not only their firms but also themselves to an enforcement action.”
FLIR is headquartered in Oregon and produces thermal imaging, night vision, and infrared cameras and sensor systems. According to the SEC’s order instituting a settled administrative proceeding, FLIR entered into a multi-million dollar contract to provide thermal binoculars to the Saudi government in November 2008. Timms and Ramahi were the primary sales employees responsible for the contract, and also were involved in negotiations to sell FLIR’s security cameras to the same government officials. At the time, Timms was the head of FLIR’s Middle East office in Dubai and Ramahi reported to him.
The SEC’s order finds that Timms and Ramahi traveled to Saudi Arabia in March 2009 and provided five officials with expensive luxury watches during meetings to discuss several business opportunities. Timms and Ramahi believed these officials were important to sales of both the binoculars and the security cameras. A few months later, they arranged for key officials, including two who received watches, to embark on what Timms referred to as a “world tour” of personal travel before and after they visited FLIR’s Boston facilities for a factory equipment inspection that was a key condition to fulfillment of the contract. The officials traveled for 20 nights with stops in Casablanca, Paris, Dubai, Beirut, and New York City. There was no business purpose for the stops outside of Boston, and the airfare and hotel accommodations were paid for by FLIR. Prior to providing the gifts and travel to the Saudi Arabian officials, Ramahi and Timms each had taken FCPA training at the company that specifically identified luxury watches and side trips as prohibited gifts.
According to the SEC’s order, when FLIR’s finance department flagged the expense reimbursement request for the watches during an unrelated review of expenses in the Dubai office and questioned the $7,000 cost, Timms and Ramahi obtained a second, fabricated invoice showing a cost of 7,000 Saudi Riyal (approximately $1,900 in U.S. dollars) instead of the true cost of $7,000 in U.S. dollars. They directed FLIR’s local third-party agent to provide false information to the company to back up their story that the original submission was merely a mistake. Ramahi and Timms also falsely claimed that FLIR’s payment for the world tour had been a billing mistake by FLIR’s travel agent, and again used false documentation and FLIR’s third-party agent to bolster their cover-up efforts.
Timms and Ramahi are U.S. citizens who reside in Thailand and the United Arab Emirates respectively. The SEC’s order finds that they violated the anti-bribery provisions of Section 30A of the Securities Exchange Act of 1934 and the internal controls and false records provisions of Section 13(b)(5) and Rule 13b2-1 of the Exchange Act. The SEC’s order further finds that Timms and Ramahi caused FLIR’s violations of the books and records provisions of Section 13(b)(2)(A) of the Exchange Act. Without admitting or denying the findings, Timms and Ramahi consented to the entry of the order and agreed to pay financial penalties of $50,000 and $20,000 respectively.
The SEC’s investigation is being conducted by FCPA Unit members Cameron P. Hoffman and Tracy L. Davis in the San Francisco office. The SEC appreciates the assistance of the Justice Department’s Fraud Section, the U.S. Attorney’s Office for the District of Massachusetts, the Federal Bureau of Investigation, and the United Arab Emirates Securities and Commodities Authority.
DOD ANNOUNCES ALLEGED DRUG CARTEL LEADER EXTRADITED FROM MEXICO TO U.S.
FROM: U.S. JUSTICE DEPARTMENT
Monday, November 17, 2014
Alleged Leader of a Mexican Drug Cartel Extradited to United States
One of the alleged leaders of the Beltran Leyva Organization, a Mexican drug-trafficking cartel responsible for importing multi-ton quantities of cocaine and methamphetamine into the United States, was extradited to the United States from Mexico on Nov. 15, 2014, and will be making an initial appearance this afternoon before U.S. Magistrate Judge Alan Kay of the District of Columbia.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Assistant Director Joseph S. Campbell of the FBI’s Criminal Investigative Division, New York Division Special Agent in Charge James J. Hunt of the Drug Enforcement Administration (DEA) and Executive Associate Director Peter T. Edge of U.S. Immigration and Customs Enforcement Homeland Security Investigations (ICE HSI) made the announcement.
“Over the past two decades, the Beltran Leyva Cartel has distributed tens of thousands of kilograms of dangerous narcotics and engaged in a campaign of violence that sparked drug wars and jeopardized public safety across North America,” said Assistant Attorney General Caldwell. “Today’s extradition of alleged kingpin Alfredo Beltran Leyva is an important step toward stamping out an organization that has ruined the lives of so many. The Justice Department is committed to working with our international partners to bring the rest of the organization to justice.”
“The arrest and extradition of Alfredo Beltran Leyva represents a significant milestone in combating transnational criminal organizations,” said FBI Assistant Director Campbell. “It is through collaborative efforts with our law enforcement partners that the United States will stem the tide of this continuing threat.”
“For years Alfredo Beltran Leyva, along with his brothers, was responsible for not only smuggling tons of cocaine to the United States, but also for the violence that has plagued the lives of Mexican citizens,” said DEA Special Agent in Charge Hunt. “His extradition to the United States is an example of a commitment to international cooperation and the rule of law.”
“The illegal drugs distributed throughout the United States by the Beltran Levya Cartel ruined countless lives in this country and sowed violence and chaos throughout Mexico,” said HSI Executive Associate Director Edge. “The arrest and extradition of Alfredo Beltran Levya to face justice here for his crimes is a great victory for ICE HSI and our partner agencies.”
Alfredo Beltran Levya, 43, was indicted on Aug. 24, 2012, for international narcotics trafficking conspiracy in connection with his leadership role in theinternational drug-trafficking cartel bearing his family name.
According to a motion for pretrial detention filed by prosecutors, between the early 1990s until his January 2008 arrest by Mexican law enforcement, Beltran Levya allegedly led the Beltran Levya Organization with his brothers Hector Beltran Levya and Arturo Beltran Levya, the latter of whom was killed in a December 2009 shootout with the Mexican army. Since the 1990s, the Beltran Levya Organization, together with the Sinaloa Cartel, allegedly directed a large-scale drug transportation network, shipping multi-ton quantities of cocaine from South America, through Central America and Mexico, and finally into the United States via land, air and sea. The organization also employed “sicarios,” or hitmen, who allegedly carried out hundreds of acts of violence, including murders, kidnappings, tortures and violent collections of drug debts, at the direction of the organization.
Following the January 2008 arrest of Alfredo Beltran Leyva by Mexican law enforcement authorities, the Beltran Leyva Organization severed its relationship with the Sinaloa Cartel, which was blamed for the arrest. This resultedin a violent war between the two drug cartels, and the murder of thousands of citizens in Mexico, including numerous law enforcement officers and officials.
On May 30, 2008, the President added the Beltran Leyva Organization to the Department of Treasury’s Office of Foreign Asset Control’s Specially Designated Nationals and Blocked Persons list pursuant to the Foreign Narcotics Kingpin Designation Act. On Aug. 20, 2009, the President specifically designated Beltran Leyva as a specially designated drug trafficker under the same Kingpin Act.
The charges in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
The investigation is led by the FBI’s El Paso Office, in partnership with the DEA’s New York Field Division and HSI’s New York Office, as part of the Organized Crime Drug Enforcement Task Force. This case is being prosecuted by the Criminal Division’s Narcotic and Dangerous Drugs Section, with the assistance of the Criminal Division’s Office of International Affairs. The Justice Department thanks the government of Mexico for their assistance in this extradition.
Monday, November 17, 2014
Alleged Leader of a Mexican Drug Cartel Extradited to United States
One of the alleged leaders of the Beltran Leyva Organization, a Mexican drug-trafficking cartel responsible for importing multi-ton quantities of cocaine and methamphetamine into the United States, was extradited to the United States from Mexico on Nov. 15, 2014, and will be making an initial appearance this afternoon before U.S. Magistrate Judge Alan Kay of the District of Columbia.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Assistant Director Joseph S. Campbell of the FBI’s Criminal Investigative Division, New York Division Special Agent in Charge James J. Hunt of the Drug Enforcement Administration (DEA) and Executive Associate Director Peter T. Edge of U.S. Immigration and Customs Enforcement Homeland Security Investigations (ICE HSI) made the announcement.
“Over the past two decades, the Beltran Leyva Cartel has distributed tens of thousands of kilograms of dangerous narcotics and engaged in a campaign of violence that sparked drug wars and jeopardized public safety across North America,” said Assistant Attorney General Caldwell. “Today’s extradition of alleged kingpin Alfredo Beltran Leyva is an important step toward stamping out an organization that has ruined the lives of so many. The Justice Department is committed to working with our international partners to bring the rest of the organization to justice.”
“The arrest and extradition of Alfredo Beltran Leyva represents a significant milestone in combating transnational criminal organizations,” said FBI Assistant Director Campbell. “It is through collaborative efforts with our law enforcement partners that the United States will stem the tide of this continuing threat.”
“For years Alfredo Beltran Leyva, along with his brothers, was responsible for not only smuggling tons of cocaine to the United States, but also for the violence that has plagued the lives of Mexican citizens,” said DEA Special Agent in Charge Hunt. “His extradition to the United States is an example of a commitment to international cooperation and the rule of law.”
“The illegal drugs distributed throughout the United States by the Beltran Levya Cartel ruined countless lives in this country and sowed violence and chaos throughout Mexico,” said HSI Executive Associate Director Edge. “The arrest and extradition of Alfredo Beltran Levya to face justice here for his crimes is a great victory for ICE HSI and our partner agencies.”
Alfredo Beltran Levya, 43, was indicted on Aug. 24, 2012, for international narcotics trafficking conspiracy in connection with his leadership role in theinternational drug-trafficking cartel bearing his family name.
According to a motion for pretrial detention filed by prosecutors, between the early 1990s until his January 2008 arrest by Mexican law enforcement, Beltran Levya allegedly led the Beltran Levya Organization with his brothers Hector Beltran Levya and Arturo Beltran Levya, the latter of whom was killed in a December 2009 shootout with the Mexican army. Since the 1990s, the Beltran Levya Organization, together with the Sinaloa Cartel, allegedly directed a large-scale drug transportation network, shipping multi-ton quantities of cocaine from South America, through Central America and Mexico, and finally into the United States via land, air and sea. The organization also employed “sicarios,” or hitmen, who allegedly carried out hundreds of acts of violence, including murders, kidnappings, tortures and violent collections of drug debts, at the direction of the organization.
Following the January 2008 arrest of Alfredo Beltran Leyva by Mexican law enforcement authorities, the Beltran Leyva Organization severed its relationship with the Sinaloa Cartel, which was blamed for the arrest. This resultedin a violent war between the two drug cartels, and the murder of thousands of citizens in Mexico, including numerous law enforcement officers and officials.
On May 30, 2008, the President added the Beltran Leyva Organization to the Department of Treasury’s Office of Foreign Asset Control’s Specially Designated Nationals and Blocked Persons list pursuant to the Foreign Narcotics Kingpin Designation Act. On Aug. 20, 2009, the President specifically designated Beltran Leyva as a specially designated drug trafficker under the same Kingpin Act.
The charges in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
The investigation is led by the FBI’s El Paso Office, in partnership with the DEA’s New York Field Division and HSI’s New York Office, as part of the Organized Crime Drug Enforcement Task Force. This case is being prosecuted by the Criminal Division’s Narcotic and Dangerous Drugs Section, with the assistance of the Criminal Division’s Office of International Affairs. The Justice Department thanks the government of Mexico for their assistance in this extradition.
Tuesday, November 18, 2014
FTC APPROVES FINAL CONSENT SETTLING CHRGES REGARDING MADE IN USA BRAND, LLC
FROM: U.S. FEDERAL TRADE COMMISSION
FTC Approves Final Consent Settling Charges that Made in USA Brand, LLC Deceived Consumers
Following a public comment period, the Federal Trade Commission has approved a final consent order settling charges that a company providing a “Made in USA” certification seal to marketers did so without verifying the companies’ Made in USA claims, or disclosing that the companies had certified themselves.
First announced in July 2014, the settlement prohibits Made in USA Brand, LLC’s deceptive claims, and bars the company from providing the marketers it certifies with the means to deceive consumers.
The Commission vote to approve the final order in this case was 5-0.
FTC Approves Final Consent Settling Charges that Made in USA Brand, LLC Deceived Consumers
Following a public comment period, the Federal Trade Commission has approved a final consent order settling charges that a company providing a “Made in USA” certification seal to marketers did so without verifying the companies’ Made in USA claims, or disclosing that the companies had certified themselves.
First announced in July 2014, the settlement prohibits Made in USA Brand, LLC’s deceptive claims, and bars the company from providing the marketers it certifies with the means to deceive consumers.
The Commission vote to approve the final order in this case was 5-0.
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