Saturday, October 4, 2014
MAN PLEADS GUILTY IN SHELL COMPANY HEALTH CARE FRAUD SCHEME
FROM: U.S. JUSTICE DEPARTMENT
Thursday, October 2, 2014
Shell Company Operator Pleads Guilty in Multi-Million Dollar Health Care Fraud and Money Laundering Scheme
A Florida managing member of a shell company pleaded guilty today in federal court in Tampa for his role in a multi-million dollar health care fraud and money laundering scheme.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney A. Lee Bentley III of the Middle District of Florida, Acting Special Agent in Charge Derrick Jackson of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office, and Special Agent in Charge Paul Wysopal of the FBI’s Tampa Field Office made the announcement.
Leonard Austin, 45, of Lake Worth, Florida, pleaded guilty in the U.S. District Court for the Middle District of Florida to conspiracy to commit money laundering of health care fraud proceeds. His sentencing date will be set at a later date by the court.
According to his plea agreement and factual proffer, from June 2010 through April 2014, Austin’s co-conspirators submitted $12 million in fraudulent claims to Medicare through three purported health clinics, Cornerstone Health Specialists of Lakeland, Florida, Summit Health Specialists P.L. of Tampa, Florida, and Coastal Health Specialists LLC of Lakeland and Melbourne, Florida. These fraudulent claims included claims resulting from illegal kickback arrangements and claims for radiology, audiology, neurology, and cardiology services that were never rendered. In fact, some of the services were purportedly provided to Medicare beneficiaries who actually had died before the supposed date of service. Medicare paid over $2,500,000 on the fraudulent claims.
Austin admitted that he and his co-conspirators attempted to conceal the funds by transferring funds through bank accounts for the clinics and Austin’s shell company, BONB LLC, aka BioScan, and other entities.
Four other defendants were indicted in this case on health care fraud and money laundering charges and are scheduled for a jury trial on April 6, 2015. An indictment is merely an accusation, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case is being investigated by HHS-OIG and the FBI and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and U.S. Attorney’s Office for the Middle District of Florida. This case is being prosecuted by Trial Attorney Christopher J. Hunter 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 NATO MILITARY COMMITTEE SAYS NATO IN TRANSFORMATION
FROM: U.S. DEFENSE DEPARTMENT
NATO Changes to Meet New Threats, Challenges
By Jim Garamone
DoD News, Defense Media Activity
WASHINGTON, Oct. 2, 2014 – Throughout its history, many people have forecast the death of the NATO alliance, but it has remained relevant and is set for another transformation, Danish Army Gen. Knud Bartels, the chairman of the NATO Military Committee, said today.
The chairman of the Military Committee directs the day-to-day business of the committee, NATO's highest military authority, and acts on its behalf, according to the NATO website.
NATO’s transformation will be an inherently different one than in the past, Bartels said at a Defense Writers’ Group breakfast.
Over its history, the alliance has transformed any number of times, Bartels said. The alliance went from a strategy of massive retaliation to one of flexible response. It went from a small Western alliance aimed at a single enemy to a large alliance of like-minded nations sharing and defending shared values. It went from a North Atlantic/European alliance to fighting a war in Central Asia. It has incorporated new capabilities like missile defense and focused on new defenses like operations in the cyber realm.
Transformation underway
Bartels sees a new transformation underway, but one that is fundamentally different than in the past.
“We are living in a world where everything takes place with emails, Twitter, Facebook, et cetera, et cetera,” he said. “This means that the long adaptation we have seen with our previous transformations will be an accelerated process, both at the military and political level.”
Threats will continue for the alliance, he said, and while it needs to look forward, it also needs to look to the past.
The challenge that Russia presents with its occupation of the Ukrainian region of Crimea and threats to eastern Ukraine is one example, Bartels said. Russia launched what is now being called a hybrid campaign against Ukraine.
The hybrid campaign, he said, is characterized by a mixture of conventional forces, unconventional forces, and information warfare.
Hybrid warfare not new
Bartels said hybrid warfare is not new. “You see the way the Soviet Union dealt with Finland during the first Soviet-Finnish War in 1939-1940,” he said. “If you see later on how the Soviet Union implemented its power in what became the Warsaw Pact. Maybe we have not been paying sufficient attention to it.”
The general said NATO knows how to counter such a campaign and is putting in place counters to the various tactics inherent in hybrid warfare.
One problem, he said, is the speed of decision-making on the Russian side. “This is characteristic of the system today and is a challenge to an alliance built on consensus of 28 [members],” Bartels said. “That needs to be addressed at the political level, but the summit at Wales made it quite clear that the allies are aware of the challenge and I am quite confident that the allies are ready to act accordingly when the necessity arises.”
Bartels said he addressed the threat in Vilnius, Lithuania, the site of the most recent meeting of the alliance’s Military Committee. Lithuania is one of the Baltic Republics once a part of the Soviet Union and a possible target of a Russian hybrid campaign.
“I expressed that should a nation or number of nations chose to challenge the integrity of the allies, they will be facing the full might of the most powerful military alliance in the world,” Bartels said. “I said it on purpose -- very clearly and very confident in Vilnius -- one of the Baltic States.”
General Petr Pavel, Chief of the General Staff of Armed Forces of the Czech Republic, was elected to succeed Bartels as the next chairman of the NATO Military Committee when Bartels is expected to step down in June 2015, according to the NATO website.
HHS WORKS TO FIND TESTS FOR INFLUENZA, BETTER RESPONSE TO PANDEMIC
FROM: U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES
HHS pursues detection tests for influenza
Tests for influenza viruses to improve diagnosis and speed pandemic response
Potential tests to help doctors diagnose influenza sooner and more accurately will advance in development under contracts from the U.S. Department of Health and Human Services’ Office of the Assistant Secretary for Preparedness and Response (ASPR). The tests could help boost influenza pandemic preparedness by increasing diagnostic capabilities in near-patient care settings such as doctors’ offices, clinics, and hospitals.
One award will advance the development of a simple, low-cost molecular test under a 3.5-year, $12.9 million contract with Alere Inc., headquartered in Waltham, Massachusetts. The other award, to InDevR Inc., of Boulder, Colorado, will allow a biochip test to move forward under a two-year, $7.9 million contract with options to extend the contract up to $14.7 million over four years.
The tests use different technologies to detect influenza viruses and offer different levels of information about the viruses detected. Both tests would use swabs taken from a patient’s nasal passage.
Alere will develop its iNAT Influenza A&B test which could yield results within 15 minutes and show whether a patient has an infection caused by a seasonal influenza virus type A or B infection. The company will conduct studies necessary to submit for U.S. Food and Drug Administration clearance or approval, including a Clinical Laboratory Improvement Amendments waiver for iNAT, which would allow the rapid molecular test to be performed in the near-patient settings.
InDevR will develop its FluChip-8G test to identify seasonal influenza viruses and recognize novel flu viruses within four hours in near-patient settings. Currently, this type of detailed genetic testing is conducted in state, federal, or specialty laboratories, and can take days to complete. If successful during the first two years, InDevR will conduct clinical studies necessary to submit for clearance or approval from the FDA and will develop a fully automated version of the test.
“Administering fast and inexpensive tests at the point of care has tangible benefits to personal and public health, particularly in helping doctors prescribe the right therapy immediately,” said Robin Robinson, Ph.D., director of ASPR’s Biomedical Advanced Research and Development Authority (BARDA) whose office will oversee the development programs. “Prescribing medication or other therapies in a more targeted way is good stewardship and will be critical to reducing the risk of antimicrobial resistance.”
Distinguishing viral influenza infections from bacterial infections could aid doctors and patients in choosing the best treatment, and could reduce unnecessary antibiotic use, as antibiotics are ineffective in treating illness caused by viruses. In addition, testing for influenza viruses in doctors’ offices, clinics, and hospitals could improve use of precautions among patients and health care workers to reduce spread of influenza from person to person.
Improved tests available in more settings can alert doctors and public health authorities to community outbreaks of respiratory illness and signal new viruses causing illness. A new influenza virus to which people do not have immunity could potentially spread quickly and have pandemic potential.
To help prepare the United States for pandemics, BARDA also is supporting development of other diagnostic platforms, including a test to identify drug resistance in influenza, as well as new vaccine technology, antiviral drugs, low-cost, portable ventilators and other medical equipment and supplies.
BARDA is seeking additional proposals for advanced development of new drugs and products to diagnosis and treat illness. Proposals are accepted through the broad agency announcement BAA-BARDA-13-100-SOL-19, available on www.fbo.gov.
These new programs are part of BARDA’s comprehensive integrated portfolio approach to the advanced research and development, innovation, acquisition, and manufacturing of vaccines, drugs, diagnostic tools, and non-pharmaceutical products for public health emergency threats. These threats include chemical, biological, radiological, and nuclear agents, pandemic influenza, and emerging infectious diseases.
ASPR leads HHS in preparing the nation to respond to and recover from adverse health effects of emergencies, supporting communities’ ability to withstand adversity, strengthening health and response systems, and enhancing national health security. HHS is the principal federal agency for protecting the health of all Americans and providing essential human services, especially for those who are least able to help themselves. To learn more about HHS, visit hhs.gov.
To learn more about ASPR and preparedness, response and recovery from the health impacts of disasters, visit the HHS public health and medical emergency website, phe.gov. Information about influenza is available at flu.gov.
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CIVILIAN, 5 NATIONAL GUARD OFFICIALS CHARGED IN BRIBERY CASE
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, October 1, 2014
Five Army National Guard Officials and One Civilian Charged with Bribery
Four retired and one active-duty Army National Guard officials and one civilian have been charged for their alleged participation in bribery schemes related to the awarding of millions of dollars of Army National Guard marketing, retention and recruitment contracts. Two of the retired Army National Guard officials and the civilian pleaded guilty for their roles in the schemes.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Dana J. Boente of the Eastern District of Virginia, U.S. Attorney Loretta E. Lynch of the Eastern District of New York, Assistant Director in Charge Andrew McCabe of the FBI’s Washington Field Office, Special Agent in Charge Robert E. Craig Jr. of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office and Director Frank Robey of the U.S. Army Criminal Investigative Command’s Major Procurement Fraud Unit (Army-CID) made the announcement.
“As captured by its motto, the Army National Guard is ‘always ready, always there’ for the American people,” said Assistant Attorney General Caldwell. “Unfortunately, today’s charges expose National Guard officials who were ‘always ready’ to pocket bribes and ‘always there’ to take kickbacks. In return, the charged officials allegedly subverted the open bidding process and illegally steered millions of taxpayer dollars to the bribe-payers through marketing and advertising contracts. Corruption should know no place in American government, but least of all in the military that so honorably serves our country. The Criminal Division is committed to rooting out corruption wherever we find it, including in the military, so that we can ensure that no one is putting the public’s trust up for sale.”
“These criminal charges and guilty pleas reflect our continued commitment to rooting out public corruption wherever it occurs,” said U.S. Attorney Boente. “The public contracting process should be one of integrity and fairness, and these cases should send a strong message that public corruption will be vigorously prosecuted in the military as well as other areas of government.”
“This investigation has sadly reminded us that even some members of our military are willing to trade on the trust their country placed in them to line their pockets with the profits of corrupt activities,” said U.S. Attorney Lynch. “We and our law enforcement partners will constantly guard against and root out such corruption wherever we find it.”
Charles Sines, 56, of Stafford, Virginia, a retired colonel from the United States Army National Guard; Wesley Russell, 48, of Albany, Indiana, a retired lieutenant colonel from the Indiana Army National Guard; and Jason Rappoccio, 39, of Hampton, South Carolina, an active-duty sergeant first class from the Army National Guard are charged with conspiracy to solicit bribes and the solicitation of bribes. Russell and Rappoccio allegedly asked for and received bribes, and Sines allegedly provided bribes.
Robert Porter, 50 of Columbia, Maryland, a retired colonel from the Army National Guard, and Timothy Bebus, 44, of Forest Lake, Minnesota, a retired sergeant major of the Minnesota Army National Guard and owner of Mil-Team Consulting and Solutions LLC, each pleaded guilty in the Eastern District of Virginia in September 2014 to conspiracy to commit bribery and bribery of a public official. Julianne Hubbell, 45, of Brooklyn Park, Minnesota, a civilian who partnered with her brother, Bebus, as the vice president of operations of Mil-Team, also pleaded guilty in September 2014 to conspiracy to commit bribery. Sentencing hearings for Bebus and Hubbell are scheduled for Jan. 23, 2015, and for Porter on Jan. 30, 2015.
“The alleged steering of large government contracts is offensive to active duty, reserve and retired members of the National Guard Bureau who took an oath to support and defend the Constitution,” said FBI Assistant Director in Charge McCabe. “It is also offensive to average American citizens who trust their government and its contractors to use taxpayer money wisely. We urge anyone who has knowledge of corruption and abuse in federal government contracting to contact the FBI.”
“The Department of Defense places special trust and confidence in its service members, particularly those in positions to influence the expenditure of taxpayer dollars,” said DCIS Special Agent in Charge Craig. “Guardsmen hold a unique position in our society, representing both their state and military service. The alleged behavior uncovered in this investigation was a disservice to both, but in no way typical of those honorable women and men that serve in our Army and Air National Guard. Identifying and investigating fraud and public corruption remains the highest of priorities for the Defense Criminal Investigative Service. Alongside our law enforcement partners, we will continue to aggressively pursue allegations of fraud impacting Department of Defense resources.”
“We have highly-trained, Army CID special agents who are extremely talented and very capable of rooting out this type of corruption within our ranks,” said Army-CID Director Robey. “People must realize, both in and out of uniform, that fraud will not be tolerated within the Army and Department of Defense, and greed cannot and will not trump duty and honor.”
As set forth in the indictments and other publicly-filed documents, the National Guard Bureau is a joint activity of the U.S. Department of Defense (DOD), state Army National Guard units and the Departments of the Army and Air Force. The National Guard Bureau, located in Arlington, Virginia, oversees the distribution of federal funding provided to the Army National Guard and its state units.
The DOD provides millions of dollars of federal funds to the Army National Guard for, among other things, advertising, marketing and sponsorships in order to recruit new members. The National Guard Bureau uses these funds to promote the Army National Guard by entering into advertising, marketing and sponsorship contracts. For example, through advertising, marketing and sponsorship contracts, the National Guard was an official sponsor of Dew Tour, Warrior Dash, and American Motorcycle Association Supercross’s events, where recruiters handed out promotional items and recruited new members. The National Guard also had a contract to sponsor Michael Jordan’s AMA Superbike team.
The National Guard Bureau can avoid a competitive bid process by awarding these federally-funded marketing contracts to Small Business Administration (SBA) certified 8(a) companies, which are minority-owned businesses. The National Guard Bureau also provides a portion of the federal funds to the state units to allocate.
The indictments allege that Sines and Rappoccio evaded the competitive bid process by using 8(a) companies to award contracts in exchange for bribes.
According to allegations in the indictment against him, Sines founded a company, Financial Solutions, after retiring from the Army National Guard as a colonel. Sines allegedly paid Porter, a then-active-duty colonel in the Army National Guard, a percentage of all contracts that Porter steered to Financial Solutions through 8(a) companies. As the director of the National Guard Bureau’s Guard Strength Directorate, Porter had substantial influence over the awarding of National Guard Bureau contracts, and allegedly steered approximately $4.5 million worth of contracts to Sines and Financial Solutions.
The indictment against Russell alleges that, while on active duty as a lieutenant colonel in the Indiana Army National Guard, Russell demanded 15 percent of all profits that a private marketing company would receive from state Army National Guard units. In return for his 15 percent cut of the profits, Russell allegedly promoted and encouraged state Army National Guard units to purchase the marketing company’s products.
The indictment against Rappoccio, an active-duty sergeant first class in the Army National Guard, alleges that Bebus and Hubbell paid Rappoccio a $30,000 bribe for steering a contract worth approximately $3.7 million to an 8(a) company chosen by Bebus. In pleading guilty, Bebus and Hubbell admitted to paying this bribe. In an effort to conceal the bribe payment, Bebus, Hubbell and others allegedly arranged for the payment of $6,000 in cash to Rappoccio, and the remaining $24,000 was allegedly routed from a business account controlled by Hubbell to an account controlled by Bebus and Hubbell’s brother-in-law, and then provided to Rappoccio in the form of a cashier’s check to Rappoccio’s wife.
An indictment is merely an allegation, and the defendants are presumed innocent unless and until proven guilty.
The case is being investigated by the FBI’s Washington Field Office, with assistance from DCIS’s Mid-Atlantic Field Office and Army-CID’s Expeditionary Fraud Resident Agency’s Major Procurement Fraud Unit. The case is being prosecuted by Trial Attorney Alison L. Anderson of the Criminal Division’s Fraud Section, Assistant U.S. Attorney Jonathan Fahey of the Eastern District of Virginia and Assistant U.S. Attorneys Marisa Seifan and Martin Coffey of the Eastern District of New York.
Friday, October 3, 2014
LABOR SECRETARY PEREZ MAKES STATEMENT ON SEPTEMBER EMPLOYMENT NUMBERS
FROM: U.S. LABOR DEPARTMENT
Statement of US Labor Secretary Perez on September employment numbers
WASHINGTON —WASHINGTON – U.S. Secretary of Labor Thomas E. Perez issued the following statement about the September 2014 Employment Situation report released today:
“The nation’s economic recovery continued in September with the addition of 248,000 new jobs. It was the 55th consecutive month of private-sector job creation, during which time businesses have created 10.3 million jobs. In 2014, we have experienced the most robust year-to-date private-sector job growth since 1998. The unemployment rate fell to 5.9 percent, its lowest level since July 2008.
“Over the last year, there are 811,000 fewer people working part time for economic reasons. Hispanic unemployment now stands at 6.9 percent, a full two-percentage-point drop from a year ago. Hispanic poverty is also down significantly. And in 2013, overall childhood poverty had its largest year-to-year decrease since 1966.
“Things are unquestionably moving in the right direction, but we can do even better. The Labor Department and the Obama administration are working harder than ever not just to create more jobs and accelerate growth, but to strengthen the middle class and build an economy that works for everyone. Just this week, the Labor Department awarded more than $450 million to help community colleges train workers for the jobs of the 21st century – a bold long-term investment in our skills infrastructure similar to President Eisenhower’s interstate highway investment in our physical infrastructure nearly 60 years ago.
“On Wednesday, we helped nearly 200,000 workers get a raise, taking final steps to implement President Obama’s executive order increasing the minimum wage to $10.10 per hour for workers on federal service and construction contracts.
“And we recently invested in states’ capacity to explore paid leave policies. As long as we remain the only industrialized nation where paid leave is not the law of the land, we are hurting both our families and the economy. Our failure to lead on leave keeps women out of the labor force, which costs us in valuable human capital and economic activity.
“Six years after the near-collapse of the U.S. economy, we have come a long, long way. The new foundation for growth is in place. The challenge now is to expand opportunity further, to help more people benefit from this recovery, and to ensure that prosperity is broadly shared.”
PRESIDENT AND FIRST LADY EXTEND BEST WISHES TO MUSLIMS CELEBRATING EID AL-ADHA AND THOSE PERFORMING THE HAJJ
FROM: THE WHITE HOUSE
Statement by the President on Hajj and Eid al-Adha
Michelle and I would like to extend our best wishes to Muslims in the United States and around the world who are celebrating Eid al-Adha, and to congratulate those performing the Hajj this year.
As our Muslim neighbors and friends gather for Eid celebrations, Muslim Americans are among the millions of pilgrims joining one of the world’s largest and most diverse gatherings. Hajj brings together Muslims from around the world – Sunni and Shiite – to share in reverent prayer, side by side. It serves as a reminder that no matter one’s tribe or sect, race or religion, gender or age, we are equals in humanity.
On Eid, Muslims continue the tradition of donating to the poor and joining efforts with other faith communities in providing assistance to those suffering from hunger, sickness, oppression, and conflict. Their service is a powerful example of the shared roots of the world’s Abrahamic faiths and how our communities can come together in shared peace, with dignity and a sense of justice.
On behalf of the American people, we extend our warmest greetings during this holiday. May the prayers of peace made by the Hajj pilgrims and those of all faiths around the world be heard and granted. Eid Mubarak.
DEFENSE SECRETARY HAGEL, FRENCH DEFENSE MINISTER LE DRIAN HOLD NEWS CONFERENCE
FROM: U.S. DEFENSE DEPARTMENT |
| U.S. Defense Secretary Chuck Hagel and French Defense Minister Jean-Yves Le Drian conduct a news conference at the Pentagon, Oct. 2, 2014. Both leaders discussed the international effort underway to defeat ISIL. DoD photo by Glenn Fawcett |
Hagel Praises Historic Bonds, Current Coalition Ties With France
By Amaani Lyle
DoD News, Defense Media Activity
WASHINGTON, Oct. 2, 2014 – Defense Secretary Chuck Hagel welcomed French Minister of Defense Jean-Yves Le Drian to the Pentagon to reaffirm their mutual resolve to address a spectrum of issues, from terrorism to infectious disease control, the two leaders said in a joint news conference today.
The secretary lauded Le Drian for France’s leading role in the international coalition to degrade and destroy the terrorist group Islamic State of Iraq and the Levant, noting that France was the first nation to join the United States in conducting airstrikes against the terrorist network. The coalition has since grown to include 40 nations.
The fight against ISIL
“American and French forces will continue to work side by side to support Iraqi forces on the ground as French aircraft patrol the skies over Iraq and provide valuable intelligence, surveillance and reconnaissance on ISIL targets,” Hagel said.
These efforts, he added, enable Iraqi and Kurdish security forces to take the offensive against ISIL.
The two leaders also discussed ways to continue building and strengthening the coalition and supporting the new government of Iraq.
“The United States and France recognize the grave threat that ISIL poses to our shared regional interests and our citizens,” Hagel said.
He recounted the recent murder of a French hostage in Algeria, an incident he described as a “stark reminder of the deadly threats ISIL presents” to France and its allies.
Challenges in Africa
During their meeting today, the secretaries also focused on security challenges in North and West Africa, two regions Hagel said now face surges of violent extremism, instability and deadly infectious disease.
“France’s leadership in confronting extremist threats in the Sahel is particularly important as the United States continues to provide support to French operations in Mali, including airlift, refueling and intelligence cooperation,” he said.
Hagel also noted that the two nations will continue to coordinate efforts across the region in response to the Ebola crisis.
NATO a cornerstone of security
The defense secretary said that in discussions at the NATO summit in Wales last month, the two nations agreed on the importance of reinforcing NATO partnerships in Eastern Europe and strengthening the readiness and capabilities of the NATO alliance.
“A strong and united NATO will be critically important to assuring a Europe whole, free and at peace,” Hagel said. “That goal remains a cornerstone of America’s approach to global and transatlantic security.”
EXPORT-IMPORT BANK SAYS BILLION DOLLAR GUARANTEE OF PEMEX BONDS SUPPORTS U.S. JOBS
FROM: U.S. EXPORT-IMPORT BANK
Ex-Im Bank Supports U.S. Jobs Through $1 Billion Guarantee of Pemex Bonds To Be Issued in the Capital Markets
Guarantee of Pemex Bonds Will Support an Estimated 6,700 U.S. Jobs
Washington, D.C. – The Export-Import Bank of the United States (Ex-Im Bank) on Monday approved two authorizations totaling $1 billion in financing to support the export of U.S. goods and services to Petróleos Mexicanos (Pemex), Mexico's national oil-and-gas company.
Ex-Im Bank’s financing will support approximately 6,700 U.S. jobs, at both large and small businesses, according to Bank estimates derived from Departments of Commerce and Labor data and methodology.
“Capital-markets financing is an innovative and proven approach that helps to provide funding for Pemex’s purchases of made-in-America goods and services at no extra cost to the U.S. Treasury,” said Ex-Im Bank Chairman and President Fred P. Hochberg. ”With these authorizations, Ex-Im Bank is continuing to meet our mission to support U.S. exporters and their workers by helping to maintain American jobs in both large and small businesses around the country.”
This transaction is assisting in financing exports to Pemex of American-made oil-field and gas-field drilling services, drilling platforms, turbine generators, mud pumps, chemicals, spare parts, geophysical studies and safety equipment – among numerous other U.S.-produced goods and services.
One of the many U.S. small businesses that is benefiting from this Ex-Im Bank financing for Pemex is Checkpoint Pumps & Systems in Mandeville, La., near New Orleans. Checkpoint Pumps, a chemical-injection packages provider, is a single source for concept, engineering, manufacturing, testing and field service. The company has approximately 70 employees at its Mandeville facility and 30 additional employees at other locations worldwide.
“We confidently expect that Ex-Im Bank financing will play an even larger role in our growth within the expanding Latin American market in the coming years,” said David Cheadle, Checkpoint’s Latin American sales manager.
Pemex will issue Ex-Im Bank-guaranteed bonds in the capital markets to fund the purchases of these exports.
MARKETERS SETTLE FTC CHARGES OVER WEIGHT-LOSS CLAIMS REGARDING CAFFEINE-INFUSED CLOTHING
FROM: U.S. FEDERAL TRADE COMMISSION
Norm Thompson Outfitters and Wacoal America Settle FTC Charges Over Weight-Loss Claims for Caffeine-infused Shapewear
Two marketers of women’s “shapewear” undergarments have settled Federal Trade Commission charges that slimming claims for their caffeine-infused products were false and not substantiated by scientific evidence. The proposed orders settling the FTC’s complaints bar Norm Thompson Outfitters, Inc., and Wacoal America, Inc., from making false and unsubstantiated claims about their shapewear and require them to pay a total of more than $1.5 million for consumer refunds.
“Caffeine-infused shapewear is the latest ‘weight-loss’ brew concocted by marketers,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “If someone says you can lose weight by wearing the clothes they are selling, steer clear. The best approach is tried and true: diet and exercise.”
The FTC’s complaint against Norm Thompson Outfitters alleges the company deceptively advertised, marketed, and sold women’s undergarments infused with microencapsulated caffeine, retinol, and other ingredients, claiming the “shapewear” would slim and reshape the wearer’s body and reduce cellulite. The products, made with Lytess brand fabrics, were sold via mail order and on the company’s Norm Thompson Outfitters, Sahalie, Body Solutions, and Body*Belle websites.
Specifically, the FTC alleges that the company made claims that wearing its shapewear would eliminate or substantially reduce cellulite; reduce the wearer’s hip measurements by up to two inches and their thigh measurements by one inch; and reduce thigh and hip measurements “without any effort.” The complaint alleges that these claims are not true or substantiated by scientific evidence, and therefore violate the FTC Act.
The complaint against Wacoal America contains similar allegations. It charges that the company’s iPants supposedly slimmed the body and reduced cellulite. Specifically, the company made false and unsubstantiated claims that wearing iPants would: substantially reduce cellulite; cause a substantial reduction in the wearer’s thigh measurements; and destroy fat cells, resulting in substantial slimming. The complaint alleges that these claims are not true or substantiated by scientific evidence, and therefore also violate the FTC Act.
The proposed administrative consent orders settling the charges against Norm Thompson Outfitters and Wacoal America ban the companies from claiming that any garment that contains any drug or cosmetic causes substantial weight or fat loss or a substantial reduction in body size. In addition, the companies are prohibited from making claims that any drug or cosmetic reduces or eliminates cellulite or reduces body fat, unless they are not misleading and can be substantiated by competent and reliable scientific evidence.
Finally, the orders require Norm Thompson Outfitters and Wacoal America to pay $230,000 and $1.3 million, respectively, that the FTC can use to provide refunds to consumers who bought the caffeinated shapewear.
Consumers should carefully evaluate advertising claims for weight-loss products. For more information, see the FTC’s guidance for consumers of products and services advertised for Weight Loss & Fitness.
The FTC is a member of the National Prevention Council, which provides coordination and leadership at the federal level regarding prevention, wellness, and health promotion practices. This case advances the National Prevention Strategy’s goal of increasing the number of Americans who are healthy at every stage of life.
The Commission vote to issue the complaints and accept the proposed consent orders was 5-0 in each case. The FTC will publish a description of the consent agreement packages in the Federal Register shortly. The agreements will be subject to public comment for 30 days, beginning today and continuing through October 29, 2014, after which the Commission will decide whether to make the proposed consent orders final.
Interested parties can submit written comments on the proposed settlements with Norm Thompson Outfitters and Wacoal America electronically or in paper form by following the instructions in the “Invitation To Comment” part of the “Supplementary Information” section of the Federal Register notice.
NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $16,000.
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.
TWO DETROIT-AREA RESIDENTS CHARGED IN HOME-HEALTH KICKBACK SCHEME
FROM: U.S. JUSTICE DEPARTMENT
Tuesday, September 30, 2014
Two Defendants Charged in Connection with Detroit-Area Home Health Kickback Scheme
Assistant Attorney General Leslie R. Caldwell 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, Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Chicago Regional Office, and Acting Special Agent in Charge Jarod Koopman, of the Internal Revenue Service - Criminal Investigation (IRS-CI) Detroit Field Office, made the announcement.
Sophia Eggleston, 52, of Farmington Hills, Michigan, and Sekne Ali, 48, of Dearborn, Michigan, were charged in a four-count indictment, unsealed today, with conspiracy to violate the Anti-Kickback Statute and substantive violations of the Anti-Kickback Statute. The indictment alleges that both defendants recruited Medicare beneficiaries to two home health agencies in Oakland County, Michigan – Prestige Home Health Services Inc. and Royal Home Health Care Inc. – and were paid kickbacks for the patient referrals. Both agencies purported to provide in-home health care services to Medicare beneficiaries.
The charges contained in an indictment are merely accusations, and a defendant is presumed innocent unless and until proven guilty.
This case was investigated by the FBI, HHS-OIG and IRS-CI 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 Eastern District of Michigan. This case is being prosecuted by Trial Attorneys Niall M. O’Donnell and James P. McDonald 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.
FORMER WELLS FARGO EMPLOYEES ACCUSED OF RATINGS CHANGE ASSOCIATED RESEARCH TO MAKE INSIDER TRADES
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
Two Former Wells Fargo Employees Charged With Insider Trading in Advance of Research Reports Containing Ratings Changes
09/29/2014 12:05 PM EDT
The Securities and Exchange Commission today announced insider trading charges against two former Wells Fargo employees involved in an alleged scheme to profit by buying or short selling a stock before research analyst reports were published containing a ratings change.
Research analysts typically produce reports with a recommendation or rating of a stock or other security they’ve reviewed. When an analyst alters a prior view on the prospects of a security, a new report is issued with a ratings change. The SEC’s Enforcement Division alleges that while Gregory T. Bolan Jr. worked as a research analyst at Wells Fargo, he tipped a trader at the firm, Joseph C. Ruggieri, in advance of several market-moving ratings upgrades or downgrades that he made in certain securities. The tips enabled Ruggieri to generate more than $117,000 in profits.
“Instead of abiding by firm policies that specifically prohibited trading ahead of published research, Ruggieri used information obtained from Bolan to make profitable trades in advance of six separate research reports,” said Sanjay Wadhwa, Senior Associate Director of the SEC’s New York Regional Office. “The repeated nature of these violations demonstrates an utter disregard for our insider trading laws.”
According to the SEC’s order instituting a litigated proceeding before an administrative law judge, Bolan also tipped a close friend with nonpublic information about his upcoming ratings changes. The friend, who is now deceased, generated approximately $10,000 in profits in a personal brokerage account by trading ahead of three ratings changes.
“Bolan gave two traders a sneak preview into his upcoming ratings changes and provided them an unfair and illegal advantage on the rest of the markets,” said Daniel M. Hawke, Chief of the SEC Enforcement Division’s Market Abuse Unit.
The SEC’s Enforcement Division alleges that after receiving Bolan’s tips, Ruggieri either purchased the relevant company’s stock ahead of Bolan’s upgrades or sold the stock short ahead of Bolan’s downgrades. Ruggieri closed his overnight positions in those securities for a profit shortly after Bolan’s ratings changes were made public and the stock prices had moved. From April 2010 to March 2011, Bolan published a total of eight research reports with a ratings change or initiation of coverage with an “outperform” or “underperform” rating. Ruggieri traded profitably ahead of six of these reports in a manner that did not fit in his typical trading pattern. Aside from this trading ahead, Ruggieri had only a handful of overnight positions in securities that had been rated within the six months prior to his trading.
The SEC’s Enforcement Division alleges that by engaging in the misconduct described in the SEC’s order, Bolan and Ruggieri willfully violated Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. The administrative proceeding will determine what relief, if any, is in the public interest against Bolan and Ruggieri, including disgorgement of ill-gotten gains, prejudgment interest, financial penalties, and other remedial measures.
The SEC’s investigation was conducted by Sandeep M. Satwalekar, Charles D. Riely, and John Marino of the SEC’s Market Abuse Unit in New York, as well as Peter A. Lamore and Alexander M. Vasilescu of the New York Regional Office. The case has been supervised by Mr. Hawke and Mr. Wadhwa. The SEC’s litigation will be led by Mr. Vasilescu and Mr. Satwalekar.
The SEC appreciates the assistance of the Financial Industry Regulatory Authority.
Thursday, October 2, 2014
U.S. CONGRATULATES PEOPLE OF GERMANY ON THEIR NATIONAL DAY
FROM: U.S. STATE DEPARTMENT
Germany's National Day
Press Statement
John Kerry
Secretary of State
Washington, DC
October 2, 2014
On behalf of President Obama and the people of the United States, I congratulate the people of Germany as you celebrate the Day of German Unity on October 3.
I will always have a personal connection to Germany. When my father served in Berlin as a Foreign Service Officer after World War II, I learned to speak German and came to love the culture, architecture, and beauty of the country.
Just last year, on my first trip abroad as Secretary, I returned to Berlin and walked its streets – past the Reichstag, past the Brandenburg Gate. I marveled not just at the miles Germany has traveled, but at the journey we have traveled together since the fall of the Berlin Wall almost twenty five years ago.
Today, the ties that bind the United States and Germany remain stronger than ever. Our partnership is critical for promoting security and stability in Afghanistan, the Middle East, and beyond. Germany is our largest trading partner in Europe, and we look forward to deepening those ties as we work together for an ambitious Transatlantic Trade and Investment Partnership.
On this anniversary, we give thanks for Germany’s many contributions to the prosperity and security of Europe and to the wider world.
SECRETARY KERRY MAKES REMARKS WITH VIETNAMESE DEPUTY PRIME MINISTER AND FOREIGN MINISTER MINH
FROM: U.S. STATE DEPARTMENT
Remarks With Vietnamese Deputy Prime Minister and Foreign Minister Pham Binh Minh Before Their Meeting
Remarks
John Kerry
Secretary of State
Benjamin Franklin Room
Washington, DC
October 2, 2014
SECRETARY KERRY: Thank you. Well, good morning, everybody. It’s my distinct pleasure to welcome the Deputy Prime Minister and Foreign Minister Pham Binh Minh, who I have known for many, many years. I first met him when he was a student in Boston at Tufts University, Fletcher, and we’ve seen each other many times since in my journeys to Vietnam and in his work over here.
It’s fair to say that in the first year of our comprehensive partnership, we have now made significant progress on the civilian 123 nuclear program, on the Proliferation Security Agreement, as well as on economic and other issues that are important to both of our countries.
And we still have things that we’re working on. One of the things that we want to try to conclude is the Trans-Pacific Partnership trade agreement, and Vietnam is working very hard with us in order to be able to do that. We continue to talk about issues in the bilateral relationship – human rights, economic development, private company ability to be able to do business. These are all important things. And I look forward to a good discussion today, and I’m delighted to welcome Pham Binh Minh here to have this dialogue.
Thank you. Thank you, sir.
DEPUTY PRIME MINISTER MINH: Thank you very much.
SECRETARY KERRY: Want to say anything?
DEPUTY PRIME MINISTER MINH: Good morning. Thank you, Mr. Secretary, for inviting me to visit officially the United States. Since the establishment of the comprehensive partnership, we have recorded many achievements in all fields – economic, political, security, defense, and other areas.
So I come to United States today to meet and to work with U.S. colleagues to review the bilateral relations between the two countries. I’m looking forward to have the fruitful discussions on bilateral issues, how to deepen our relation, and also discuss the regional and international issues of our mutual interest. Thank you.
SECRETARY KERRY: Thank you, sir, very much. Thank you. Thank you all very much.
DEPUTY PRIME MINISTER MINH: Thank you.
23 YEAR OLD BOMB PLOTTER SENTENCED TO SERVE 30 YEARS IN PRISON
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, October 1, 2014
Convicted Bomb Plotter Sentenced to 30 Years
PORTLAND, Oregon. – Mohamed Osman Mohamud, 23, who was convicted in 2013 of attempting to use a weapon of mass destruction (explosives) in connection with a plot to detonate a vehicle bomb at an annual Christmas tree lighting ceremony in Portland, was sentenced today to serve 30 years in prison, followed by a lifetime term of supervised release.
Mohamud, a naturalized U.S. citizen from Somalia and former resident of Corvallis, Oregon, was arrested on Nov. 26, 2010, after he attempted to detonate what he believed to be an explosives-laden van that was parked near the tree lighting ceremony in Portland. The arrest was the culmination of a long-term undercover operation, during which Mohamud was monitored closely for months as his bomb plot developed. The device was in fact inert, and the public was never in danger from the device.
At sentencing, United States District Court Judge Garr M. King, who presided over Mohamed’s 14-day trial, said “the intended crime was horrific,” and that the defendant, even though he was presented with options by undercover FBI employees, “never once expressed a change of heart.” King further noted that the Christmas tree ceremony was attended by up to 10,000 people, and that the defendant “wanted everyone to leave either dead or injured.” King said his sentence was necessary in view of the seriousness of the crime and to serve as deterrence to others who might consider similar acts.
“With today’s sentencing, Mohamed Osman Mohamud is being held accountable for his attempted use of what he believed to be a massive bomb to attack innocent civilians attending a public Christmas tree lighting ceremony in Portland,” said John P. Carlin, Assistant Attorney General for National Security. “The evidence clearly indicated that Mohamud was intent on killing as many people as possible with his attack. Fortunately, law enforcement was able to identify him as a threat, insert themselves in the place of a terrorist that Mohamud was trying to contact, and thwart Mohamud’s efforts to conduct an attack on our soil. This case highlights how the use of undercover operations against would-be terrorists allows us to engage and disrupt those who wish to commit horrific acts of violence against the innocent public. The many agents, analysts, and prosecutors who have worked on this case deserve great credit for their roles in protecting Portland from the threat posed by this defendant and ensuring that he was brought to justice.”
“This trial provided a rare glimpse into the techniques Al Qaeda employs to radicalize home-grown extremists,” said Amanda Marshall, U.S. Attorney for the District of Oregon. “With the sentencing today, the court has held this defendant accountable. I thank the dedicated professionals in the law enforcement and intelligence communities who were responsible for this successful outcome. I look forward to our continued work with Muslim communities in Oregon who are committed to ensuring that all young people are safe from extremists who seek to radicalize others to engage in violence.”
According to the trial evidence, in February 2009, Mohamud began communicating via e-mail with Samir Khan, a now-deceased al Qaeda terrorist who published Jihad Recollections, an online magazine that advocated violent jihad, and who also published Inspire, the official magazine of al-Qaeda in the Arabian Peninsula. Between February and August 2009, Mohamed exchanged approximately 150 emails with Khan. Mohamud wrote several articles for Jihad Recollections that were published under assumed names.
In August 2009, Mohamud was in email contact with Amro Al-Ali, a Saudi national who was in Yemen at the time and is today in custody in Saudi Arabia for terrorism offenses. Al-Ali sent Mohamud detailed e-mails designed to facilitate Mohamud’s travel to Yemen to train for violent jihad. In December 2009, while Al-Ali was in the northwest frontier province of Pakistan, Mohamud and Al-Ali discussed the possibility of Mohamud traveling to Pakistan to join Al-Ali in terrorist activities. Mohamud responded to Al-Ali in an e-mail: “yes, that would be wonderful, just tell me what I need to do.” Al-Ali referred Mohamud to a second associate overseas and provided Mohamud with a name and email address to facilitate the process.
In the following months, Mohamud made several unsuccessful attempts to contact Al-Ali’s associate. Ultimately, an FBI undercover operative contacted Mohamud via email under the guise of being an associate of Al-Ali’s. Mohamud and the FBI undercover operative agreed to meet in Portland in July 2010. At the meeting, Mohamud told the FBI undercover operative he had written articles that were published in Jihad Recollections. Mohamud also said that he wanted to become “operational.” Asked what he meant by “operational,” Mohamud said he wanted to put an explosion together, but needed help.
According to evidence presented at trial, at a meeting in August 2010, Mohamud told undercover FBI operatives he had been thinking of committing violent jihad since the age of 15. Mohamud then told the undercover FBI operatives that he had identified a potential target for a bomb: the annual Christmas tree lighting ceremony in Portland’s Pioneer Courthouse Square on Nov. 26, 2010. The undercover FBI operatives cautioned Mohamud several times about the seriousness of this plan, noting there would be many people at the event, including children, and emphasized that Mohamud could abandon his attack plans at any time with no shame. Mohamud indicated the deaths would be justified and that he would not mind carrying out a suicide attack on the crowd.
According to evidence presented at trial, in the ensuing months Mohamud continued to express his interest in carrying out the attack and worked on logistics. On Nov. 4, 2010, Mohamud and the undercover FBI operatives traveled to a remote location in Lincoln County, Oregon, where they detonated a bomb concealed in a backpack as a trial run for the upcoming attack. During the drive back to Corvallis, Mohamud was asked if was capable looking at all the bodies of those who would be killed during the explosion. In response, Mohamud noted, “I want whoever is attending that event to be, to leave either dead or injured.” Mohamud later recorded a video of himself, with the assistance of the undercover FBI operatives, in which he read a statement that offered his rationale for his bomb attack.
On Nov. 18, 2010, undercover FBI operatives picked up Mohamud to travel to Portland to finalize the details of the attack. On Nov. 26, 2010, just hours before the planned attack, Mohamud examined the 1,800 pound bomb in the van and remarked that it was “beautiful.” Later that day, Mohamud was arrested after he attempted to remotely detonate the inert vehicle bomb rked near the Christmas tree lighting ceremony
This case was investigated by the FBI, with assistance from the Oregon State Police, the Corvallis Police Department, the Lincoln County Sheriff’s Office and the Portland Police Bureau. The prosecution was handled by Assistant U.S. Attorneys Ethan D. Knight and Pamala Holsinger from the U.S. Attorney’s Office for the District of Oregon. Trial Attorney Jolie F. Zimmerman, from the Counterterrorism Section of the Justice Department’s National Security Division, assisted.
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