FROM: THE WHITE HOUSE
April 16, 2015
Remarks by the President at the Wounded Warrior Project Soldier Ride Event
South Lawn
11:24 A.M. EDT
THE PRESIDENT: Good morning, everybody! (Applause.) What a gorgeous day. I will just point out, it is always beautiful at this particular event. It is gorgeous every single day. And I want to thank Vice President Biden and VA Secretary Bob McDonald for being here.
This is the sixth time that we’ve welcomed the Soldier Ride to the White House. It’s one of our favorite events of the year. You all know the story. Over 10 years ago, a young Long Island bartender, a civilian named Chris Carney, dreamed up the idea of biking coast-to-coast to raise money and support for our wounded warriors. And back then, he probably would not have predicted how far the Soldier Ride would go; how thousands of Americans would join the cause; how a nation would be inspired by all of you.
We’ve got a number of folks here who are currently serving or have served in uniform. We’ve got Army. (Hooah!) We’ve got Navy. (Applause.) Air Force. (Applause.) We’ve got Marines. (Oorah!) And we’ve got some Coast Guard.
AUDIENCE MEMBER: Yeah! (Laughter.)
THE PRESIDENT: That’s it, man. (Applause.)
We’ve got some extraordinary military families who support you every single mile. (Applause.) So we are among heroes here today -- all the riders, I just had a chance to say hi to them, and they look great. Don’t get too comfortable, though -- you’ve got a lot of miles ahead. This is just a pit stop so we can all cheer you on.
Just to give you some sense of who these riders are -- we’ve got heroes like Sergeant William Armstrong. Where’s William? There he is in the back. (Applause.) William was 24 years old and serving in Afghanistan when a roadside bomb tore the ligaments in his knee and broke the bones in his leg. As a lifelong distance runner, he was devastated that he might never run again. But he didn’t give up. His caretakers at Walter Reed got him a bike so he could get into shape. After a lot of surgeries and months of physical therapy, two weeks ago, William ran a marathon. (Applause.) And I want to quote what William said here. He said, “This Army put me back together,” he says. But it was being “with people with similar life experiences… that exhilarated and motivated me.” Thank you, William, for your incredible service. (Applause.)
We’ve got Specialist Teresa Ann Jackson. Where’s Teresa? There she is right there. (Applause.) Two years ago, while serving as a medic at Fort Campbell, Teresa fell ill with a rare disease that affected her arteries. Doctors had to amputate both her feet. She remembers the shock and isolation she and her husband felt afterwards. And again, I want to quote her: “I wasn’t expecting to be in a wheelchair at 30,” she says. And at first, her -- at her first Wounded Warrior event, she found a community of people who welcomed her, who understood what she was going through, who continue to support her today through her recovery. And today, Teresa wants to study to be a social worker so that she can give back to others. Teresa, we thank you. (Applause.)
And we’ve got Captain Vincent Cerchione. Where’s Vincent? There he is right there. (Applause.) In 2003, Vincent led a dozen soldiers of the 3rd Infantry Division into battle in Iraq, taking rocket fire on a daily basis. He served two tours there, and then came home with the kind of wound you can’t always see -- post-traumatic stress. But with courage and the support of his wife, Vincent reached out for help, which is what we want all of our warriors to do. He says that when he found the Wounded Warrior Project -- and I’m quoting here -- “It was the first time since I returned that I’d ever talked to anybody and felt like I wasn’t alone.” Vincent, you are never alone. And because of your service, we also know that we are never alone and we’re always safe. Thank you so much for everything you’ve done. (Applause.)
So that’s what these riders represent here today -- that sense of community and support and love for each other. And that’s what binds everyone who serves proudly under our flag and all the Americans who cheer you on. It’s our chance to say to all our returning heroes that you’re not alone, that we’ve got your back, we’re going to be with you every step of the way. We will be with you all that long journey that it often takes to recover every single mile.
You and all the men and women of our Armed Forces represent what’s best in America. And for me and Michelle and the girls, for Joe Biden and Jill, and I know Bob and his family, time with you has been some of the most inspiring parts of our jobs. We could not be prouder of you or more grateful to you and your families for everything you’ve done to protect our freedom.
And that’s why, as Commander-in-Chief, I’m going to keep doing everything in my power to make sure that we serve you as well as you serve us. That means getting you the care and benefits that you deserve and have earned, including wounds like traumatic brain injury and post-traumatic stress. It means making sure our veterans have the education and the jobs and opportunities that you have to have in order to get your shot at the American Dream that you helped to defend. It means recognizing and supporting the incredible families and caregivers who sacrifice so much. They serve as well. We’ve got to be there for those families.
So I want to encourage every American along the route to get out and cheer for these men and women. And I want all of our riders -- and all those that you’re riding for, including some who were left behind on the field of battle -- we want all of you to know that we’re not just going to be with you for three days and these 60 miles. As a nation, as Americans grateful for your sacrifices, we’re going to be with you on all the roads of your life ahead.
So God bless you and your families, all who serve. God bless America. With that, I’m going to do my favorite part which is blow the horn. (Laughter.) Let’s get this ride started. (Applause.)
END
11:30 A.M. EST
Saturday, April 18, 2015
Friday, April 17, 2015
U.S. CONGRATULATES PEOPLE OF ZIMBABWE ON THEIR INDEPENDENCE DAY
FROM: U.S. STATE DEPARTMENT
On the Occasion of the Republic of Zimbabwe's National Day
Press Statement
John Kerry
Secretary of State
Washington, DC
April 17, 2015
On behalf of President Obama and the American people, I congratulate the people of Zimbabwe as you mark 35 years of independence on April 18.
The United States is a steadfast friend of the Zimbabwean people. We are proud to work with you toward a future that is healthy, prosperous, and democratic for all your citizens.
I look forward to our continued engagement in areas of common interest over the coming year.
On the Occasion of the Republic of Zimbabwe's National Day
Press Statement
John Kerry
Secretary of State
Washington, DC
April 17, 2015
On behalf of President Obama and the American people, I congratulate the people of Zimbabwe as you mark 35 years of independence on April 18.
The United States is a steadfast friend of the Zimbabwean people. We are proud to work with you toward a future that is healthy, prosperous, and democratic for all your citizens.
I look forward to our continued engagement in areas of common interest over the coming year.
DOD REPORTS: ONGOING AIRSTRIKES AGAINST ISIL
FROM: U.S. DEFENSE DEPARTMENT
Coalition Continues Airstrikes Against ISIL in Syria, Iraq
Compiled from Combined Joint Task Force Operation Inherent Resolve News Releases
SOUTHWEST ASIA, April 16, 2015 – U.S. and coalition military forces have continued to attack Islamic State of Iraq and the Levant terrorists in Syria and Iraq, Combined Joint Task Force Operation Inherent Resolve officials reported today.
Officials reported details of the latest strikes, which took place between 8 a.m. yesterday and 8 a.m. today, local time, noting that assessments of results are based on initial reports.
Airstrikes in Syria
Attack and fighter aircraft conducted six airstrikes in Syria:
-- Near Hasakah, two airstrikes struck two ISIL tactical units, destroyed six ISIL fighting positions, an ISIL vehicle bomb, an ISIL tunnel and an ISIL bunker.
-- Near Kobani, four airstrikes struck two ISIL tactical units and destroyed six ISIL fighting positions.
Airstrikes in Iraq
Fighter, attack and remotely piloted aircraft conducted 17 airstrikes in Iraq, approved by the Iraqi Ministry of Defense:
-- Near Beiji, nine airstrikes struck two large and six smaller tactical units, destroyed two ISIL fighting positions and an ISIL heavy machine gun.
-- Near Fallujah, two airstrikes struck two ISIL tactical units and destroyed an ISIL bunker.
-- Near Mosul, an airstrike struck an ISIL staging area.
-- Near Ramadi, three airstrikes struck two ISIL tactical units and destroyed an ISIL armored personnel carrier.
-- Near Sinjar, an airstrike struck an ISIL tactical unit, destroyed an ISIL building, an ISIL mortar system and an ISIL fighting position.
-- Near Tal Afar, an airstrike struck an ISIL tactical unit, destroyed an ISIL heavy machine gun and an ISIL fighting position.
Part of Operation Inherent Resolve
The strikes were conducted as part of Operation Inherent Resolve, the operation to eliminate the ISIL terrorist group and the threat they pose to Iraq, Syria, the region, and the wider international community. The destruction of ISIL targets in Syria and Iraq further limits the terrorist group's ability to project terror and conduct operations, officials said.
Coalition nations conducting airstrikes in Iraq include the United States, Australia, Belgium, Canada, Denmark, France, Jordan, the Netherlands and the United Kingdom. Coalition nations conducting airstrikes in Syria include the United States, Bahrain, Canada, Jordan, Saudi Arabia and the United Arab Emirates.
Coalition Continues Airstrikes Against ISIL in Syria, Iraq
Compiled from Combined Joint Task Force Operation Inherent Resolve News Releases
SOUTHWEST ASIA, April 16, 2015 – U.S. and coalition military forces have continued to attack Islamic State of Iraq and the Levant terrorists in Syria and Iraq, Combined Joint Task Force Operation Inherent Resolve officials reported today.
Officials reported details of the latest strikes, which took place between 8 a.m. yesterday and 8 a.m. today, local time, noting that assessments of results are based on initial reports.
Airstrikes in Syria
Attack and fighter aircraft conducted six airstrikes in Syria:
-- Near Hasakah, two airstrikes struck two ISIL tactical units, destroyed six ISIL fighting positions, an ISIL vehicle bomb, an ISIL tunnel and an ISIL bunker.
-- Near Kobani, four airstrikes struck two ISIL tactical units and destroyed six ISIL fighting positions.
Airstrikes in Iraq
Fighter, attack and remotely piloted aircraft conducted 17 airstrikes in Iraq, approved by the Iraqi Ministry of Defense:
-- Near Beiji, nine airstrikes struck two large and six smaller tactical units, destroyed two ISIL fighting positions and an ISIL heavy machine gun.
-- Near Fallujah, two airstrikes struck two ISIL tactical units and destroyed an ISIL bunker.
-- Near Mosul, an airstrike struck an ISIL staging area.
-- Near Ramadi, three airstrikes struck two ISIL tactical units and destroyed an ISIL armored personnel carrier.
-- Near Sinjar, an airstrike struck an ISIL tactical unit, destroyed an ISIL building, an ISIL mortar system and an ISIL fighting position.
-- Near Tal Afar, an airstrike struck an ISIL tactical unit, destroyed an ISIL heavy machine gun and an ISIL fighting position.
Part of Operation Inherent Resolve
The strikes were conducted as part of Operation Inherent Resolve, the operation to eliminate the ISIL terrorist group and the threat they pose to Iraq, Syria, the region, and the wider international community. The destruction of ISIL targets in Syria and Iraq further limits the terrorist group's ability to project terror and conduct operations, officials said.
Coalition nations conducting airstrikes in Iraq include the United States, Australia, Belgium, Canada, Denmark, France, Jordan, the Netherlands and the United Kingdom. Coalition nations conducting airstrikes in Syria include the United States, Bahrain, Canada, Jordan, Saudi Arabia and the United Arab Emirates.
FACING CHALLENGES: THE U.S. DOD SHIFT TO ASIA-PACIFIC
Right: Defense Secretary Ash Carter speaks with Navy Adm. Samuel J. Locklear III at U.S. Pacific Command headquarters at Camp Smith, Hawaii April 12, 2015. Three days later, Locklear joined other Defense Department leaders on Capitol Hill for a hearing on maintaining the U.S. military’s technological edge. DoD photo by Navy Petty Officer 2nd Class Sean Hurt.
Asia-Pacific Shift Creates Opportunities, Security Needs
By Cheryl Pellerin
DoD News, Defense Media Activity
WASHINGTON, April 15, 2015 – The Defense Department’s ongoing rebalance to the thriving Asia-Pacific region comes with many opportunities and a few pressing requirements: to upgrade security relationships, maintain specific military capabilities and redouble efforts to boost U.S. technological superiority, defense officials said today.
Christine Wormuth, undersecretary of defense for policy, testified before the House Armed Services Committee on implications for aspects of the department’s Asia-Pacific rebalance of losing military technological superiority.
Joining the undersecretary were Navy Adm. Samuel J. Locklear III, commander of U.S. Pacific Command, and Army Gen. Curtis M. Scaparrotti, commander of U.S. Forces Korea.
The past seven years have been a time of tremendous change and opportunity for the Asia-Pacific region, Wormuth told the panel.
“As nations there rise and become more prosperous,” she said, “it's created a lot of opportunity at the same time that dynamism in the region has created a much more complex security environment in which we are now operating.”
Challenges in the Region
The department faces several challenges in the region, including those that come from China, she said.
“China's very rapid military modernization, its opaque defense budget, its actions in space and cyberspace and its behavior in places like the East and South China Seas,” she added, raise serious questions for the department.
China's expanding interests are a natural part of its rise, Wormuth said, but its behavior in the maritime domain, for example, has created friction for its neighbors.
“The government's efforts to incrementally advance its claims in the East and South China Seas and its extensive land reclamation activities, particularly the prospect of further militarizing those outposts, are very concerning to us,” she said.
China and North Korea
The United States and China are not allies, but they don’t have to be adversaries, Wormuth added, noting that the department is speaking with China about its concerning actions and about activities to improve understanding, especially through military-to-military engagement with the People’s Liberation Army.
Elsewhere in the region, she said, DoD’s greatest concern is North Korea's pursuit of ballistic missiles and its weapons of mass destruction program.
Other challenges in the region, Wormuth told the panel, “are magnified by a growing range of nontraditional threats, such as the increased flow of foreign fighters both to and from Asia, the trafficking of illegal goods and people, and devastating natural disasters such as the cyclone we saw last month in Vanuatu.”
DoD is focused on the rebalance along several lines of effort, Wormuth said.
Strengthening Security Relationships
These include strengthening security relationships with allies and partners, including Japan, South Korea, Australia and the Philippines, and strengthening new relationships in South and Southeast Asia. These include Singapore, Indonesia, Malaysia and Vietnam.
The department also is investing in its partnership with the 10-nation Association of Southeast Asian Nations, which leads an effort to build a more robust regional security architecture, the undersecretary said. The U.S-India relationship also is an important partnership, she added.
The department is updating its forward presence, putting more assets into the region and using its assets in new ways, Wormuth said.
“We've developed a more distributed model for our Marine Corps that is reducing our concentrated presence in Okinawa [by] relocating Marines to Australia, Guam, Hawaii and mainland Japan,” she added.
Sustaining the U.S. Technological Edge
The Navy is working on its rotational-presence concept, including being on track to have four littoral combat ships rotating through Singapore by 2017. Two ships are already there, the undersecretary said.
And the Army will initiate its first rotational deployment of a brigade combat team to the Korean Peninsula later this spring.
“We're making significant investments to sustain our American technological edge into the future in the air, land, sea and undersea domains,” Wormuth added, investing in precision munitions and working on new capabilities for operating freely in space and cyberspace.
In his remarks to the panel, Locklear said that the United States is a Pacific nation, but also an island nation.
“We rely very heavily on power projection, which means we have to be able to get the forces forward [and] sustain them forward,” he said.
U.S. forces “rely heavily on systems that several decades ago weren't even known about or thought about too much, and that exist now in the cyber world and in the space world,” Locklear said.
Dominant Military Power
Such systems also could reveal vulnerabilities that the department will have to pace with technological advancements, the admiral said.
“It's my assessment that we remain the most dominant military power in the world in all aspects,” Locklear said. “And I think that not a country in the world would disagree with that today, even though I think they would recognize that … the relative gap between how good we are versus how some of the other forces may be developing is shrinking.”
But Locklear said he believes the United States clearly has the best ships, the best submarines, the best aircraft carriers, “and the best people running them in the world.”
He added, “What’s important to me is making sure that the force we have, number one, is dominant … and it needs to be technologically superior across multiple domains.”
Relevant in All Domains
From space to cyber to air to integrated air and missile defense, to sea, maritime, subsurface maritime, the admiral said, there are technological challenges as all the militaries of the world get better in these domains. “We must continue apace to be relevant in the domains that allow us to project U.S. power in defense of U.S. interests,” he said.
In his remarks, Scaparrotti focused on the Korean Peninsula.
The North Koreans are developing asymmetric capabilities, he said, “and specifically orienting on what they consider to be some of our vulnerabilities, and through their development they are trying to close our dominance.”
Specific asymmetric capabilities that Scaparrotti said he thinks about most are North Korea’s ballistic missile capability and the continued ability to counter it, along with its intelligence, surveillance and reconnaissance capabilities.
Maintaining Dominance
“Many of our adversaries are becoming more proficient in determining how to work inside our capabilities -- our intelligence, surveillance and reconnaissance capabilities -- and also how to use deception and other means in order to limit the advantage we have today,” the general said.
The Defense Department has to continue to develop its capabilities, to change its posture, its concepts and its employment to ensure that we maintain dominance, Scaparrotti added.
“My top concern is that we will have little to no warning of a North Korean asymmetric provocation, which could start a cycle of action and counteraction leading to unintended escalation,” Scaparrotti said.
This underscores the need for the alliance to maintain a high level of readiness and vigilance, he added, noting that last year the alliance took significant steps to improve its capabilities and capacities to deter aggression and reduce operational risk.
Steadfast Strategic Partner
“But our work is not done,” the general said. “In 2015, we will maintain this momentum by focusing on my top priority -- sustaining and strengthening the alliance -- with an emphasis on our combined readiness.”
Strengthening the alliance includes ensuring the rapid flow of ready forces into Korea in the early phases of hostilities, he said, and improving ISR capabilities and critical munitions.
Based on both nations’ national security strategies, Scaparrotti said, the United States will continue to be a steadfast strategic partner to South Korea, “and South Korea is poised to be a long-lasting and important ally to America.”
DEPUTY DEFENSE SECRETARY WORK SPEAKS ABOUT SPACE DOMAIN
Air Force Gen. John E. Hyten, commander of Air Force Space Command, right, and Secretary of the Air Force Deborah Lee James, center, greet Deputy Defense Secretary Bob Work as he arrives at the Scitor Complex to attend and speak at the Space Symposium in Colorado Springs, Colo., April 15, 2015. DoD photo by U.S. Air Force Master Sgt. Adrian Cadiz.
Work: Space Domain Presents Challenges, Threats
By Jim Garamone
DoD News, Defense Media Activity
ABOARD A U.S. MILITARY AIRCRAFT, April 16, 2015 – In a candid and passionate speech, Deputy Defense Secretary Bob Work yesterday asked members of the space community to help the United States maintain its edge in the space domain in the 21st century.
Work spoke to more than 200 people from industry and government at the annual Space Symposium in Colorado Springs, Colorado.
The space domain is an increasingly important area for the U.S. military, the U.S. government and the American people, the deputy secretary said.
‘Space Architecture Faces Increasing Risks’
“Space architecture faces increasing threats and together we must think about those challenges,” Work said in his speech.
The world is seeing a reemergence of strategic competition, which was dormant since the end of the Cold War, a senior defense official said, speaking on background.
Since the end of the Cold War, space has been a relatively benign environment, but that has changed, the official said. China, for example, tested an anti-satellite capability in January 2007, destroying one of its weather satellites as it traveled more than 500 miles above the Earth, the official said.
Russia also has capabilities that could reach into space, and the United States can no longer assume that space will not be contested, the official added.
Work stressed that the U.S. national security space architecture is resilient, but it is facing increasing threats, and America must think about and act on those challenges.
‘Space is Deeply Enmeshed in Our Force Structure’
“Space is deeply enmeshed in our force structure and is central to our way of deterring, assuring and warfighting,” the deputy secretary said.
The U.S. military cannot be complacent and must emphasize space control as challenges arise, he said.
Officials said that to maintain dominance in space, the United States “must consider all space assets, both classified and unclassified, as part of single constellation. And if an adversary tries to deny us the capability, we must be able to respond in an integrated, coordinated fashion.”
The deputy secretary stated the ultimate goal for the United States is to maintain space capabilities, through all phases of conflict, regardless of actions to deny the ultimate high ground.
The symposium was a perfect place for such a candid talk, the official said on background. Those in the space industry know they are important to the nation, “but it was a call for them to think hard about the future of national security in space.”
Work asked the audience to look at how the nation thinks of deterrence and stability in this emerging world where space assets might be held at risk.
“It was a really positive and candid interchange,” the official said. “It was not your average bureaucratic speech. [Work] was very animated and passionate about this issue. Space, cyber, [and] nuclear are core issues for us as a nation.”
Protecting Space Assets
In an environment where space assets are at risk, “you want to be able to be sure that the [space] community is thinking about how to protect them and the services they provide,” the official said. Industry and government must work together on the design and architecture of space systems, the official said, to make them perform better and make them less vulnerable.
Defense Secretary Ash Carter and Work have consistently stimulated strategic thinking in the department, and this has cut across all domains, the official said, noting a common factor in the domains is the contribution from space.
“You can’t be serious about strategic thinking and about deterrence in the 21st century if you are not talking about space,” the official said.
Looking at the core elements of what DoD does to defend America, its allies and its interests, it is clear that space is increasingly important, according to the official.
“Strategy dictates that if something is getting more important to core objectives it has to place higher on your hierarchy of needs,” the official said. “It’s important that we manage it in the right way.”
CDC REPORT SHOWS PUERTO RICO AS HAVING LOWER RATES OF NEW LUNG, BREAST CANCER
FROM: U.S. CENTERS FOR DISEASE CONTROL AND PREVENTION
Puerto Rico has lower rates of new cases of lung and breast cancer than the rest of US
Puerto Rico has the lowest incidence rate of new lung cancer compared with all other races and ethnic groups in the United States, according to a study published today in the Centers for Disease Control and Prevention's Morbidity and Mortality Weekly Report. The report also shows that Puerto Rico has a lower incidence rate of female breast cancer compared with U.S. non-Hispanic white and black women.
The report presents for the first time invasive cancer incidence rates for 2007–2011 among Puerto Rican residents by sex, age, cancer site, and region using U.S. Cancer Statistics data. Puerto Rico has similar incidence rates to U.S. populations for cancer of the colon and rectum. Cancers of the prostate (152 cases per 100,000 men), female breast (84 cases per 100,000 women), and colon and rectum (43 cases per 100,000 persons) are the most common cancer sites among Puerto Rico residents.
"These data underscore the importance of Puerto Ricans getting proper screening for breast, cervical, and colorectal cancer to identify them early when they are most treatable," said Guillermo Tortolero-Luna, M.D., Ph.D., director of Cancer Control and Populations Sciences at the University of Puerto Rico and a co-author of the paper.
The differences in reported cancer incidence rates between U.S. and Puerto Rican residents may be partly explained by differences in health behaviors and risk factors associated with cancers. For example, Puerto Rico has lower smoking rates than all American states (with the exception of Utah), which could explain the lower rates of lung cancer.
"We are encouraged to see lower lung cancer incidence rates in Puerto Rico than the rest of the U.S. However, we must remain diligent in our cancer control efforts to continue progress," said Blythe Ryerson, Ph.D., M.P.H., a lead epidemiologist in CDC's Division of Cancer Prevention and Control and an author of the paper. "We recommend all smokers quit for good."
Puerto Rico has lower rates of new cases of lung and breast cancer than the rest of US
Puerto Rico has the lowest incidence rate of new lung cancer compared with all other races and ethnic groups in the United States, according to a study published today in the Centers for Disease Control and Prevention's Morbidity and Mortality Weekly Report. The report also shows that Puerto Rico has a lower incidence rate of female breast cancer compared with U.S. non-Hispanic white and black women.
The report presents for the first time invasive cancer incidence rates for 2007–2011 among Puerto Rican residents by sex, age, cancer site, and region using U.S. Cancer Statistics data. Puerto Rico has similar incidence rates to U.S. populations for cancer of the colon and rectum. Cancers of the prostate (152 cases per 100,000 men), female breast (84 cases per 100,000 women), and colon and rectum (43 cases per 100,000 persons) are the most common cancer sites among Puerto Rico residents.
"These data underscore the importance of Puerto Ricans getting proper screening for breast, cervical, and colorectal cancer to identify them early when they are most treatable," said Guillermo Tortolero-Luna, M.D., Ph.D., director of Cancer Control and Populations Sciences at the University of Puerto Rico and a co-author of the paper.
The differences in reported cancer incidence rates between U.S. and Puerto Rican residents may be partly explained by differences in health behaviors and risk factors associated with cancers. For example, Puerto Rico has lower smoking rates than all American states (with the exception of Utah), which could explain the lower rates of lung cancer.
"We are encouraged to see lower lung cancer incidence rates in Puerto Rico than the rest of the U.S. However, we must remain diligent in our cancer control efforts to continue progress," said Blythe Ryerson, Ph.D., M.P.H., a lead epidemiologist in CDC's Division of Cancer Prevention and Control and an author of the paper. "We recommend all smokers quit for good."
SEC ALLEGES NEW YORK CITY-BASED FINANCIAL ADVISOR STOLE AT LEAST $20 MILLION
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
04/16/2015 02:55 PM EDT
The Securities and Exchange Commission today announced fraud charges against a New York City-based financial advisor accused of stealing at least $20 million from customers to fund his own brokerage accounts and then squandering the bulk of the money in highly unprofitable options trading.
The SEC alleges that Michael J. Oppenheim abused his position as a private client advisor at a global bank and persuaded some customers to withdraw millions of dollars out of their accounts by promising he would purchase safe and secure municipal bonds on their behalf. Instead, Oppenheim bought himself cashier’s checks and deposited them into his own brokerage account or his wife’s account that he controlled. Almost immediately after each theft and deposit, Oppenheim allegedly embarked on sizeable trading of stocks and options including Tesla, Apple, Google, and Netflix. Oppenheim typically lost the entire amount of each deposit, and his brokerage accounts currently show minimal cash balances. On occasions when his accounts did have positive cash balances, he allegedly wired money to bank accounts in his or his wife’s name. At least one outgoing wire was used to pay off a portion of his mortgage.
“We allege that Oppenheim promised his customers that he would invest their money in safe and secure investments, but he seized their funds and aggressively played the stock market in his own accounts,” said Amelia A. Cottrell, Associate Director of the SEC’s New York Regional Office.
In a parallel action, the U.S. Attorney’s Office for the Southern District of New York today announced criminal charges against Oppenheim.
According to the SEC’s complaint filed in federal court in Manhattan, Oppenheim took illicit steps to conceal his fraud. For instance, Oppenheim created false account statements when a customer asked for a statement reflecting his municipal bond holdings. Oppenheim simply pasted the customer’s name onto an account statement reflecting the holdings of another customer, and provided the fabricated statement to convince the customer that he had purchased the municipal bonds for his account as promised. In another instance, Oppenheim transferred money from one customer to another to replenish the amounts he had stolen earlier.
The SEC’s complaint charges Oppenheim, who lives in Livingston, N.J., with violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 as well as Sections 206(1) and 206(2) of the Investment Advisers Act of 1940. The SEC’s complaint seeks disgorgement of ill-gotten gains plus prejudgment interest and financial penalties as well as permanent injunctions barring future violations. The SEC’s complaint against Oppenheim names his wife Alexandra Oppenheim as a relief defendant for the purpose of recovering any customer funds transferred to her.
The SEC’s investigation, which is continuing, is being conducted by William Martin, Nancy Brown, Neil Hendelman, and Charles Riely of the New York Regional Office. The case is being supervised by Amelia A. Cottrell, and the SEC’s litigation will be led by Nancy Brown and William Martin. The New York Regional Office’s broker-dealer examination team of Michael Kress, Jennifer Fournier, and Ronald Sukhu assisted the investigation. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York, the Federal Bureau of Investigation, and the Financial Industry Regulatory Authority.
04/16/2015 02:55 PM EDT
The Securities and Exchange Commission today announced fraud charges against a New York City-based financial advisor accused of stealing at least $20 million from customers to fund his own brokerage accounts and then squandering the bulk of the money in highly unprofitable options trading.
The SEC alleges that Michael J. Oppenheim abused his position as a private client advisor at a global bank and persuaded some customers to withdraw millions of dollars out of their accounts by promising he would purchase safe and secure municipal bonds on their behalf. Instead, Oppenheim bought himself cashier’s checks and deposited them into his own brokerage account or his wife’s account that he controlled. Almost immediately after each theft and deposit, Oppenheim allegedly embarked on sizeable trading of stocks and options including Tesla, Apple, Google, and Netflix. Oppenheim typically lost the entire amount of each deposit, and his brokerage accounts currently show minimal cash balances. On occasions when his accounts did have positive cash balances, he allegedly wired money to bank accounts in his or his wife’s name. At least one outgoing wire was used to pay off a portion of his mortgage.
“We allege that Oppenheim promised his customers that he would invest their money in safe and secure investments, but he seized their funds and aggressively played the stock market in his own accounts,” said Amelia A. Cottrell, Associate Director of the SEC’s New York Regional Office.
In a parallel action, the U.S. Attorney’s Office for the Southern District of New York today announced criminal charges against Oppenheim.
According to the SEC’s complaint filed in federal court in Manhattan, Oppenheim took illicit steps to conceal his fraud. For instance, Oppenheim created false account statements when a customer asked for a statement reflecting his municipal bond holdings. Oppenheim simply pasted the customer’s name onto an account statement reflecting the holdings of another customer, and provided the fabricated statement to convince the customer that he had purchased the municipal bonds for his account as promised. In another instance, Oppenheim transferred money from one customer to another to replenish the amounts he had stolen earlier.
The SEC’s complaint charges Oppenheim, who lives in Livingston, N.J., with violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 as well as Sections 206(1) and 206(2) of the Investment Advisers Act of 1940. The SEC’s complaint seeks disgorgement of ill-gotten gains plus prejudgment interest and financial penalties as well as permanent injunctions barring future violations. The SEC’s complaint against Oppenheim names his wife Alexandra Oppenheim as a relief defendant for the purpose of recovering any customer funds transferred to her.
The SEC’s investigation, which is continuing, is being conducted by William Martin, Nancy Brown, Neil Hendelman, and Charles Riely of the New York Regional Office. The case is being supervised by Amelia A. Cottrell, and the SEC’s litigation will be led by Nancy Brown and William Martin. The New York Regional Office’s broker-dealer examination team of Michael Kress, Jennifer Fournier, and Ronald Sukhu assisted the investigation. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York, the Federal Bureau of Investigation, and the Financial Industry Regulatory Authority.
NSF ARTICLE ON PROBLEMS WITH SOME GREEN LAKES AND RIVERS
FROM: NATIONAL SCIENCE FOUNDATION
Earth Day is on the horizon. But is 'greener' always better?
Not when it's the bright green waters of algae-fouled lakes and rivers
Going green. On Earth Day and every day, being "greener" is linked with good things like lowering your carbon footprint and eating locally-grown foods.
But not when it comes to drinking or swimming in the bright green waters of lakes fouled by algae, says Hans Paerl, an environmental scientist at the University of North Carolina at Chapel Hill.
In freshwater lakes around the world, such algae blooms often result from an overabundance of what's known as cyanobacteria, or blue-green algae.
Cyanobacteria form widespread, very visible blooms that look like blue-green paint or scum floating on the water. They may be toxic to humans and other animals.
These filamentous bacteria clump into mats that cover a lake's surface from one shore to the other, using up oxygen in the water and eventually turning the lake's depths into a dead zone.
From Lake Taihu, China, to Lake Erie in the U.S.
It was June 2007, and water spouting from kitchen faucets in Wuxi, China, was pea-soup green. The water came from Taihu, China's third largest lake.
Cyanobacteria obscured the surface of the 900-square-mile lake and quickly overwhelmed the intake plant for the city of Wuxi's drinking water.
Chinese officials scooped 6,000 tons of algae from Taihu and diverted water from the Yangtze River to flush the lake. However, says Paerl, the bloom persisted. "It was fall when it finally abated."
Two weeks into the bloom, Paerl was in China, leaning over the side of a small boat to take samples of Taihu's scum.
He discovered that the algae is similar to that found in blooms in North Carolina's ponds, rivers and estuaries, and in many larger bodies of water such as Lake Erie, Lake Victoria and the Baltic Sea.
"Nowhere are the blooms worse than on Taihu, however," says Paerl, whose work is funded by an NSF Dimensions of Biodiversity grant. "Habitat for fish, crabs and other aquatic species is becoming endangered."
Ten million people also depend on Taihu for drinking water, fisheries and tourism.
Lake Erie on the border of the United States and Canada faces the same challenges.
In 2011, a record-breaking bloom of similar cyanobacteria to the species that plagued Taihu smothered Lake Erie, turning it a bright-green that showed up on satellite images.
At the bloom's peak in October, it expanded to more than 1,930 square miles, three times larger than any Lake Erie bloom on record.
New "recipe" for controlling algae blooms
The "recipe" for controlling the problem, says Paerl, "has been to reduce phosphorus finding its way into lakes from sources on land like fertilizers. That's based on the long-standing paradigm that phosphorus is the key nutrient limiting freshwater algae blooms."
But another element, nitrogen, flowing into lakes and rivers is increasing more rapidly than phosphorus. "It's led researchers to question whether both nitrogen and phosphorus should be controlled to stem the tide of proliferating algae blooms," says Paerl.
Lake Taihu, he says, is a "looking glass" for addressing such nutrient overenrichment and toxic algae blooms.
"Our NSF Dimensions of Biodiversity project is determining what roles specific nutrients like nitrogen and phosphorus play in the frequency and extent of algae blooms in lakes, and how they affect these ecosystems."
Data from experiments on the relationship between nutrients and algae blooms are being used to formulate a nutrient reduction management strategy. Scientists hope it will lead to the control of blooms in Taihu and other lakes.
The goal, Paerl says, is to find new ways of ensuring sustainable uses of lakes prone to blooms.
Other scientists involved in the research are Wayne Gardner of the University of Texas, Ferdi Hellweger of Northeastern University and Steven Wilhelm of the University of Tennessee.
"Harmful cyanobacteria blooms caused by excessive phosphorus and nitrogen are threatening freshwater lakes worldwide," says Simon Malcomber, lead NSF program director for Dimensions of Biodiversity, which is supported by NSF's Directorates for Biological Sciences and Geosciences.
"This research shows the importance of taking a holistic approach to understanding harmful cyanobacteria blooms," says Malcomber. "Only with an ecosystems approach can long-term successful sustainability strategies be formulated."
Chain of events links land and lake
The complex chain that leads to algae blooms in freshwater begins not in lakes but on land.
Farmers often overfertilize their fields. The excess fertilizer, laden with nutrients like phosphorus and nitrogen, washes into creeks and rivers, where it's eventually carried to lakes.
"Nitrogen is necessary for increasing crop yields," says Paerl, "but plants are inefficient at taking it up. More fertilizer is often added than plants need."
Only a fraction of the nitrogen applied to soils ends up in crops; in some regions, it's less than 20 percent. The rest is on the loose.
When the excess eventually reaches freshwater, it fertilizes aquatic algae such as cyanobacteria--just as it encourages plants on land to grow. The algae proliferate, becoming massive blooms.
As the algae die, they fall to the lake's bottom and are digested by microorganisms. The process removes oxygen from the water, creating low-oxygen "dead zones," fish kills and tainted waters.
Extreme algae blooms: The new normal?
Are algae blooms in lakes around the world a new normal?
Scientists are working to find answers.
"This important work is linking the diversity and identity of algae with nitrogen cycling and harmful algal blooms in heavily affected freshwater lakes," says Mike Sieracki, Dimensions of Biodiversity program director in NSF's Division of Ocean Sciences.
This week at an NSF-funded workshop--Global Solutions to Regional Problems: Collecting Global Expertise to Address the Problem of Harmful Algal Blooms--researchers discussed the current science on algae blooms, and identified knowledge gaps in bloom prevention and mitigation.
"We hope that this workshop will lead to strategies to mitigate future blooms in waterbodies in the U.S. and around the world," says Bill Cooper, program director in NSF's Division of Chemical, Bioengineering, Environmental and Transport Systems.
Meeting topics included the biology of bloom-forming species, environmental factors underlying bloom formation, sensor development in bloom detection, prediction of blooms, and best practices for control.
"New nutrient reduction strategies," wrote Paerl and colleagues in the journal Science in October 2014, "should incorporate point and non-point sources, including nitrogen removal in wastewaters, optimization of fertilizer application, and erosion controls.
"An investment in joint phosphorus and nitrogen controls will counter the very high costs of harmful algal bloom events and the losses of freshwater resources worldwide."
It's the only way, Paerl says, to keep blooms of cyanobacteria and other algae in check. When it comes to lakes and rivers, streams and ponds, "going green" means anything but.
-- Cheryl Dybas, NSF
Earth Day is on the horizon. But is 'greener' always better?
Not when it's the bright green waters of algae-fouled lakes and rivers
Going green. On Earth Day and every day, being "greener" is linked with good things like lowering your carbon footprint and eating locally-grown foods.
But not when it comes to drinking or swimming in the bright green waters of lakes fouled by algae, says Hans Paerl, an environmental scientist at the University of North Carolina at Chapel Hill.
In freshwater lakes around the world, such algae blooms often result from an overabundance of what's known as cyanobacteria, or blue-green algae.
Cyanobacteria form widespread, very visible blooms that look like blue-green paint or scum floating on the water. They may be toxic to humans and other animals.
These filamentous bacteria clump into mats that cover a lake's surface from one shore to the other, using up oxygen in the water and eventually turning the lake's depths into a dead zone.
From Lake Taihu, China, to Lake Erie in the U.S.
It was June 2007, and water spouting from kitchen faucets in Wuxi, China, was pea-soup green. The water came from Taihu, China's third largest lake.
Cyanobacteria obscured the surface of the 900-square-mile lake and quickly overwhelmed the intake plant for the city of Wuxi's drinking water.
Chinese officials scooped 6,000 tons of algae from Taihu and diverted water from the Yangtze River to flush the lake. However, says Paerl, the bloom persisted. "It was fall when it finally abated."
Two weeks into the bloom, Paerl was in China, leaning over the side of a small boat to take samples of Taihu's scum.
He discovered that the algae is similar to that found in blooms in North Carolina's ponds, rivers and estuaries, and in many larger bodies of water such as Lake Erie, Lake Victoria and the Baltic Sea.
"Nowhere are the blooms worse than on Taihu, however," says Paerl, whose work is funded by an NSF Dimensions of Biodiversity grant. "Habitat for fish, crabs and other aquatic species is becoming endangered."
Ten million people also depend on Taihu for drinking water, fisheries and tourism.
Lake Erie on the border of the United States and Canada faces the same challenges.
In 2011, a record-breaking bloom of similar cyanobacteria to the species that plagued Taihu smothered Lake Erie, turning it a bright-green that showed up on satellite images.
At the bloom's peak in October, it expanded to more than 1,930 square miles, three times larger than any Lake Erie bloom on record.
New "recipe" for controlling algae blooms
The "recipe" for controlling the problem, says Paerl, "has been to reduce phosphorus finding its way into lakes from sources on land like fertilizers. That's based on the long-standing paradigm that phosphorus is the key nutrient limiting freshwater algae blooms."
But another element, nitrogen, flowing into lakes and rivers is increasing more rapidly than phosphorus. "It's led researchers to question whether both nitrogen and phosphorus should be controlled to stem the tide of proliferating algae blooms," says Paerl.
Lake Taihu, he says, is a "looking glass" for addressing such nutrient overenrichment and toxic algae blooms.
"Our NSF Dimensions of Biodiversity project is determining what roles specific nutrients like nitrogen and phosphorus play in the frequency and extent of algae blooms in lakes, and how they affect these ecosystems."
Data from experiments on the relationship between nutrients and algae blooms are being used to formulate a nutrient reduction management strategy. Scientists hope it will lead to the control of blooms in Taihu and other lakes.
The goal, Paerl says, is to find new ways of ensuring sustainable uses of lakes prone to blooms.
Other scientists involved in the research are Wayne Gardner of the University of Texas, Ferdi Hellweger of Northeastern University and Steven Wilhelm of the University of Tennessee.
"Harmful cyanobacteria blooms caused by excessive phosphorus and nitrogen are threatening freshwater lakes worldwide," says Simon Malcomber, lead NSF program director for Dimensions of Biodiversity, which is supported by NSF's Directorates for Biological Sciences and Geosciences.
"This research shows the importance of taking a holistic approach to understanding harmful cyanobacteria blooms," says Malcomber. "Only with an ecosystems approach can long-term successful sustainability strategies be formulated."
Chain of events links land and lake
The complex chain that leads to algae blooms in freshwater begins not in lakes but on land.
Farmers often overfertilize their fields. The excess fertilizer, laden with nutrients like phosphorus and nitrogen, washes into creeks and rivers, where it's eventually carried to lakes.
"Nitrogen is necessary for increasing crop yields," says Paerl, "but plants are inefficient at taking it up. More fertilizer is often added than plants need."
Only a fraction of the nitrogen applied to soils ends up in crops; in some regions, it's less than 20 percent. The rest is on the loose.
When the excess eventually reaches freshwater, it fertilizes aquatic algae such as cyanobacteria--just as it encourages plants on land to grow. The algae proliferate, becoming massive blooms.
As the algae die, they fall to the lake's bottom and are digested by microorganisms. The process removes oxygen from the water, creating low-oxygen "dead zones," fish kills and tainted waters.
Extreme algae blooms: The new normal?
Are algae blooms in lakes around the world a new normal?
Scientists are working to find answers.
"This important work is linking the diversity and identity of algae with nitrogen cycling and harmful algal blooms in heavily affected freshwater lakes," says Mike Sieracki, Dimensions of Biodiversity program director in NSF's Division of Ocean Sciences.
This week at an NSF-funded workshop--Global Solutions to Regional Problems: Collecting Global Expertise to Address the Problem of Harmful Algal Blooms--researchers discussed the current science on algae blooms, and identified knowledge gaps in bloom prevention and mitigation.
"We hope that this workshop will lead to strategies to mitigate future blooms in waterbodies in the U.S. and around the world," says Bill Cooper, program director in NSF's Division of Chemical, Bioengineering, Environmental and Transport Systems.
Meeting topics included the biology of bloom-forming species, environmental factors underlying bloom formation, sensor development in bloom detection, prediction of blooms, and best practices for control.
"New nutrient reduction strategies," wrote Paerl and colleagues in the journal Science in October 2014, "should incorporate point and non-point sources, including nitrogen removal in wastewaters, optimization of fertilizer application, and erosion controls.
"An investment in joint phosphorus and nitrogen controls will counter the very high costs of harmful algal bloom events and the losses of freshwater resources worldwide."
It's the only way, Paerl says, to keep blooms of cyanobacteria and other algae in check. When it comes to lakes and rivers, streams and ponds, "going green" means anything but.
-- Cheryl Dybas, NSF
STATE DEPARTMENT ISSUES FACT SHEET TOUTING NUCLEAR NON-PROLIFERATION TREATY
FROM: U.S. STATE DEPARTMENT
04/14/2015 08:22 AM EDT
Myths and Facts Regarding the Nuclear Non-Proliferation Treaty and Regime
Fact Sheet
Bureau of International Security and Nonproliferation
April 14, 2015
(1) Myth: The NPT has failed to prevent the spread of nuclear weapons.
The Nuclear Non-Proliferation Treaty (NPT) has enjoyed tremendous successes over the 45 years since its entry into force. The NPT is the most widely adhered to nuclear treaty in history. It has established an international legal framework against the proliferation of nuclear weapons to which 190 countries have subscribed. Among them are states that abandoned nuclear weapons or nuclear weapons programs with the NPT serving as an impetus. The vast majority of NPT parties meet their obligations and benefit every day from the security the Treaty provides. For the few that do not, the NPT provides a common international basis for resolving noncompliance where the actions of a country contravene the treaty’s principles.
(2) Myth: Not enough is being done to pursue nuclear disarmament.
When the NPT entered into force in 1970, the United States had a nuclear stockpile of over 26,000 nuclear weapons. By 2013 that number had been reduced by about 82 percent to 4,804 operationally deployed strategic nuclear warheads. From October 1993 through September 2013, the United States dismantled almost 10,000 nuclear warheads. Several thousand additional nuclear weapons are currently retired and awaiting dismantlement. Nuclear weapons reductions continue as we fulfill our obligations under the New Strategic Arms Reduction Treaty (New START). When the New START Treaty limits are reached in 2018, the United States and Russia will have reduced our respective operationally deployed strategic forces to 1,550 deployed strategic warheads, their lowest level since the 1950s. The United States has reaffirmed our commitment to additional arms control measures, and has proposed negotiations with Russia to achieve another one-third reduction in our strategic nuclear arsenals. We also remain committed to bringing into force the Comprehensive Nuclear Test Ban Treaty and we seek the immediate start to negotiations on a Fissile Material Cutoff Treaty.
Beyond nuclear arms control negotiations, we seek to broaden our cooperation with non-nuclear weapons states on disarmament verification issues through a new initiative, the International Partnership for Nuclear Disarmament Verification. This program aims to develop technical solutions to challenges involved in verifying future nuclear agreements.
(3) Myth: Modernization of nuclear weapons and related infrastructure is a step backwards on disarmament and inconsistent with NPT disarmament obligations.
The United States is committed not to pursue new nuclear warheads, and life extension programs will not provide for new military capabilities. U.S. stockpile stewardship and life extension programs are designed to service the existing nuclear arsenal in order to ensure it remains safe, secure, and effective so long as nuclear weapons exist. The United States is pursuing life extension for a number of warhead types that will enable us to eliminate many of the weapons we maintain in our stockpile as a hedge against technical contingencies.
Modernization of nuclear infrastructure has nothing to do with developing new nuclear weapons. These investments are needed to replace aging infrastructure that will allow us to safely, securely, and more rapidly reduce the total stockpile. Simply put, infrastructure modernization, stockpile stewardship, and life extension programs for U.S. warheads will contribute to and do not detract from progress on our NPT nuclear disarmament obligations.
(4) Myth: There is insufficient cooperation among the nuclear weapons states on promoting nuclear disarmament, nonproliferation and peaceful uses.
The NPT Nuclear Weapon States (P5) are working to strengthen implementation of all three pillars of the NPT. Since 2009, the P5 have met annually to jointly pursue an agenda of strengthening the global nuclear nonproliferation regime and have institutionalized regular dialogue on nuclear weapons-related issues. One notable result of these meetings has been development of a common reporting framework on implementation of the 2010 NPT Review Conference Action Plan. We are also pursuing technical work on nuclear terms and definitions that can help lay the foundation for future cooperation or agreements. P5 engagement is a long-term investment to strengthen and advance the NPT, build trust and create a stronger foundation to achieve the Treaty’s disarmament, nonproliferation and peaceful uses goals.
(5) Myth: Nuclear Weapons States are insensitive to the humanitarian impact of nuclear weapons.
This is simply not true. Underpinning all of our nonproliferation and disarmament efforts, stretching back decades, has been our clear understanding and recognition of the humanitarian consequences of the use of nuclear weapons. The United States remains firmly committed to the view that it is in the interest of all states that the 70-year record of non-use of nuclear weapons be extended indefinitely. The United States participated in the Conference on the Humanitarian Impact of Nuclear Weapons in Vienna, Austria, last December to reinforce the message that it is precisely because of the destructive power of nuclear weapons that we give the highest priority to ensuring these weapons remain safe and secure for as long as they exist. While we share some of the frustration with the slow pace of nuclear disarmament, we also recognize that the realization of a world without nuclear weapons will require significant changes in the international system. For this reason, the practical path of step-by-step, verifiable nuclear reductions remains the only realistic route to our shared goal of a nuclear weapons- free world.
(6) Myth: “Hair-trigger” alert status and failures to take proper care of nuclear weapons are accidents waiting to happen, and demonstrate the urgent need to eliminate all nuclear weapons.
U.S. nuclear forces are not on “hair-trigger” alert and the U.S. employs multiple, rigorous and redundant technical and procedural safeguards to protect against accidental or unauthorized launch. Only the President can authorize the employment of U.S. nuclear weapons and we are taking further steps to maximize decision time for the President in a crisis. These steps enhance stability before and during a crisis and avoid the instability and compressed decision times that are inherent to changes in alert status.
The United States is also actively working to reduce the numbers and role of nuclear weapons in our national security strategy. These steps include taking all of our non-strategic nuclear bombers and nuclear-capable heavy bombers off day-to-day alert, engaging in the practice of open-ocean targeting for ICBMs and SLBMs, and reducing the number of warheads each ICBM carries to a single warhead. Converting ICBMs to a single warhead makes these weapons less attractive targets and therefore more stabilizing. Continuing at-sea patrols for submarines carrying nuclear weapons have a similar effect.
(7) Myth: Export controls and discriminatory policies are impeding nuclear cooperation and preventing developing countries from exercising their inalienable right to the peaceful uses of nuclear energy.
The United States fully supports the right of all Parties to the NPT to use nuclear energy for peaceful purposes, in conformity with their nonproliferation obligations. An effective, transparent export control regime helps build confidence among states that assistance provided for peaceful nuclear development will not be diverted to illegal weapons purposes. The United States and other major supplier nations do not apply export controls in order to impede legitimate nuclear commerce. Rather, U.S. export controls are designed to maximize legitimate trade while raising barriers to high risk transfers that could result in the diversion or retransfer of U.S. technology, equipment and material to weapons purposes.
The United States actively lends support to NPT Parties that are in compliance with their NPT obligations to help them develop the infrastructure needed for peaceful nuclear applications and safe, secure, and safeguarded nuclear power programs. The United States is by far the largest contributor to IAEA peaceful use programs, including about $142 million in voluntary contributions to the Technical Cooperation program since 2010 and another $50 million toward the IAEA Peaceful Uses Initiative (PUI) that we helped launch. PUI programs have addressed the sustainable development needs of more than 120 Member States in areas such as human health, water resource management, food security, environmental protection, and nuclear power infrastructure development.
(8) Myth: The United States has a double standard with respect to opposing nuclear proliferation.
The United States remains committed to universality of the NPT and has consistently urged the few countries that have never signed the Treaty to accede as non-nuclear weapon states and in the interim to take actions that are supportive of NPT principles and provisions. We have also been consistent in advancing international efforts to hold NPT Parties to account for noncompliance with the Treaty – as President Obama said in his 2009 Prague Speech, rules must be binding, violations must be punished and words must mean something. We are very encouraged with process underway to address Iran’s noncompliance and we remain steadfast in our insistence that North Korea return to the NPT and IAEA safeguards and comply fully with its UN Security Council and nonproliferation obligations.
(9) Myth: The United States is not doing its part to promote a Middle East zone free of weapons of mass destruction.
The United States remains firmly committed to the goal of a Middle East free of weapons of mass destruction and their delivery systems. We continue to work with Russia, the UK, the UN and the Conference Facilitator, Ambassador Laajava, to convene the proposed conference to discuss a regional zone. We have supported five rounds of consultations between Israel and Arab states and encourage these talks to continue. Regional states bear the responsibility to reach consensus on arrangements for the conference. Efforts to turn the NPT process into a referendum on this issue should be rejected.
(10) Myth: Nuclear cooperation with India is inconsistent with the NPT.
Nothing in the U.S.-India Civil Nuclear Agreement or in the 2008 policy decision of the Nuclear Suppliers Group to enable civil nuclear cooperation with India violates the NPT. Such cooperation is permitted provided the supply of material or equipment is under safeguards. Under the parameters of the initiative, India committed to separate its civilian and military nuclear facilities and has placed all civilian-designated nuclear facilities under IAEA safeguards. All U.S. civil nuclear cooperation with India is subject to such safeguards, and cooperation on sensitive nuclear technologies is ruled out. India has also worked to bring its export controls into line with internationally-recognized standards and committed to continue its voluntary moratorium on nuclear testing and support negotiation of a fissile material cutoff treaty. These commitments constitute significant gains for global nonproliferation efforts.
04/14/2015 08:22 AM EDT
Myths and Facts Regarding the Nuclear Non-Proliferation Treaty and Regime
Fact Sheet
Bureau of International Security and Nonproliferation
April 14, 2015
(1) Myth: The NPT has failed to prevent the spread of nuclear weapons.
The Nuclear Non-Proliferation Treaty (NPT) has enjoyed tremendous successes over the 45 years since its entry into force. The NPT is the most widely adhered to nuclear treaty in history. It has established an international legal framework against the proliferation of nuclear weapons to which 190 countries have subscribed. Among them are states that abandoned nuclear weapons or nuclear weapons programs with the NPT serving as an impetus. The vast majority of NPT parties meet their obligations and benefit every day from the security the Treaty provides. For the few that do not, the NPT provides a common international basis for resolving noncompliance where the actions of a country contravene the treaty’s principles.
(2) Myth: Not enough is being done to pursue nuclear disarmament.
When the NPT entered into force in 1970, the United States had a nuclear stockpile of over 26,000 nuclear weapons. By 2013 that number had been reduced by about 82 percent to 4,804 operationally deployed strategic nuclear warheads. From October 1993 through September 2013, the United States dismantled almost 10,000 nuclear warheads. Several thousand additional nuclear weapons are currently retired and awaiting dismantlement. Nuclear weapons reductions continue as we fulfill our obligations under the New Strategic Arms Reduction Treaty (New START). When the New START Treaty limits are reached in 2018, the United States and Russia will have reduced our respective operationally deployed strategic forces to 1,550 deployed strategic warheads, their lowest level since the 1950s. The United States has reaffirmed our commitment to additional arms control measures, and has proposed negotiations with Russia to achieve another one-third reduction in our strategic nuclear arsenals. We also remain committed to bringing into force the Comprehensive Nuclear Test Ban Treaty and we seek the immediate start to negotiations on a Fissile Material Cutoff Treaty.
Beyond nuclear arms control negotiations, we seek to broaden our cooperation with non-nuclear weapons states on disarmament verification issues through a new initiative, the International Partnership for Nuclear Disarmament Verification. This program aims to develop technical solutions to challenges involved in verifying future nuclear agreements.
(3) Myth: Modernization of nuclear weapons and related infrastructure is a step backwards on disarmament and inconsistent with NPT disarmament obligations.
The United States is committed not to pursue new nuclear warheads, and life extension programs will not provide for new military capabilities. U.S. stockpile stewardship and life extension programs are designed to service the existing nuclear arsenal in order to ensure it remains safe, secure, and effective so long as nuclear weapons exist. The United States is pursuing life extension for a number of warhead types that will enable us to eliminate many of the weapons we maintain in our stockpile as a hedge against technical contingencies.
Modernization of nuclear infrastructure has nothing to do with developing new nuclear weapons. These investments are needed to replace aging infrastructure that will allow us to safely, securely, and more rapidly reduce the total stockpile. Simply put, infrastructure modernization, stockpile stewardship, and life extension programs for U.S. warheads will contribute to and do not detract from progress on our NPT nuclear disarmament obligations.
(4) Myth: There is insufficient cooperation among the nuclear weapons states on promoting nuclear disarmament, nonproliferation and peaceful uses.
The NPT Nuclear Weapon States (P5) are working to strengthen implementation of all three pillars of the NPT. Since 2009, the P5 have met annually to jointly pursue an agenda of strengthening the global nuclear nonproliferation regime and have institutionalized regular dialogue on nuclear weapons-related issues. One notable result of these meetings has been development of a common reporting framework on implementation of the 2010 NPT Review Conference Action Plan. We are also pursuing technical work on nuclear terms and definitions that can help lay the foundation for future cooperation or agreements. P5 engagement is a long-term investment to strengthen and advance the NPT, build trust and create a stronger foundation to achieve the Treaty’s disarmament, nonproliferation and peaceful uses goals.
(5) Myth: Nuclear Weapons States are insensitive to the humanitarian impact of nuclear weapons.
This is simply not true. Underpinning all of our nonproliferation and disarmament efforts, stretching back decades, has been our clear understanding and recognition of the humanitarian consequences of the use of nuclear weapons. The United States remains firmly committed to the view that it is in the interest of all states that the 70-year record of non-use of nuclear weapons be extended indefinitely. The United States participated in the Conference on the Humanitarian Impact of Nuclear Weapons in Vienna, Austria, last December to reinforce the message that it is precisely because of the destructive power of nuclear weapons that we give the highest priority to ensuring these weapons remain safe and secure for as long as they exist. While we share some of the frustration with the slow pace of nuclear disarmament, we also recognize that the realization of a world without nuclear weapons will require significant changes in the international system. For this reason, the practical path of step-by-step, verifiable nuclear reductions remains the only realistic route to our shared goal of a nuclear weapons- free world.
(6) Myth: “Hair-trigger” alert status and failures to take proper care of nuclear weapons are accidents waiting to happen, and demonstrate the urgent need to eliminate all nuclear weapons.
U.S. nuclear forces are not on “hair-trigger” alert and the U.S. employs multiple, rigorous and redundant technical and procedural safeguards to protect against accidental or unauthorized launch. Only the President can authorize the employment of U.S. nuclear weapons and we are taking further steps to maximize decision time for the President in a crisis. These steps enhance stability before and during a crisis and avoid the instability and compressed decision times that are inherent to changes in alert status.
The United States is also actively working to reduce the numbers and role of nuclear weapons in our national security strategy. These steps include taking all of our non-strategic nuclear bombers and nuclear-capable heavy bombers off day-to-day alert, engaging in the practice of open-ocean targeting for ICBMs and SLBMs, and reducing the number of warheads each ICBM carries to a single warhead. Converting ICBMs to a single warhead makes these weapons less attractive targets and therefore more stabilizing. Continuing at-sea patrols for submarines carrying nuclear weapons have a similar effect.
(7) Myth: Export controls and discriminatory policies are impeding nuclear cooperation and preventing developing countries from exercising their inalienable right to the peaceful uses of nuclear energy.
The United States fully supports the right of all Parties to the NPT to use nuclear energy for peaceful purposes, in conformity with their nonproliferation obligations. An effective, transparent export control regime helps build confidence among states that assistance provided for peaceful nuclear development will not be diverted to illegal weapons purposes. The United States and other major supplier nations do not apply export controls in order to impede legitimate nuclear commerce. Rather, U.S. export controls are designed to maximize legitimate trade while raising barriers to high risk transfers that could result in the diversion or retransfer of U.S. technology, equipment and material to weapons purposes.
The United States actively lends support to NPT Parties that are in compliance with their NPT obligations to help them develop the infrastructure needed for peaceful nuclear applications and safe, secure, and safeguarded nuclear power programs. The United States is by far the largest contributor to IAEA peaceful use programs, including about $142 million in voluntary contributions to the Technical Cooperation program since 2010 and another $50 million toward the IAEA Peaceful Uses Initiative (PUI) that we helped launch. PUI programs have addressed the sustainable development needs of more than 120 Member States in areas such as human health, water resource management, food security, environmental protection, and nuclear power infrastructure development.
(8) Myth: The United States has a double standard with respect to opposing nuclear proliferation.
The United States remains committed to universality of the NPT and has consistently urged the few countries that have never signed the Treaty to accede as non-nuclear weapon states and in the interim to take actions that are supportive of NPT principles and provisions. We have also been consistent in advancing international efforts to hold NPT Parties to account for noncompliance with the Treaty – as President Obama said in his 2009 Prague Speech, rules must be binding, violations must be punished and words must mean something. We are very encouraged with process underway to address Iran’s noncompliance and we remain steadfast in our insistence that North Korea return to the NPT and IAEA safeguards and comply fully with its UN Security Council and nonproliferation obligations.
(9) Myth: The United States is not doing its part to promote a Middle East zone free of weapons of mass destruction.
The United States remains firmly committed to the goal of a Middle East free of weapons of mass destruction and their delivery systems. We continue to work with Russia, the UK, the UN and the Conference Facilitator, Ambassador Laajava, to convene the proposed conference to discuss a regional zone. We have supported five rounds of consultations between Israel and Arab states and encourage these talks to continue. Regional states bear the responsibility to reach consensus on arrangements for the conference. Efforts to turn the NPT process into a referendum on this issue should be rejected.
(10) Myth: Nuclear cooperation with India is inconsistent with the NPT.
Nothing in the U.S.-India Civil Nuclear Agreement or in the 2008 policy decision of the Nuclear Suppliers Group to enable civil nuclear cooperation with India violates the NPT. Such cooperation is permitted provided the supply of material or equipment is under safeguards. Under the parameters of the initiative, India committed to separate its civilian and military nuclear facilities and has placed all civilian-designated nuclear facilities under IAEA safeguards. All U.S. civil nuclear cooperation with India is subject to such safeguards, and cooperation on sensitive nuclear technologies is ruled out. India has also worked to bring its export controls into line with internationally-recognized standards and committed to continue its voluntary moratorium on nuclear testing and support negotiation of a fissile material cutoff treaty. These commitments constitute significant gains for global nonproliferation efforts.
FTC BARS COMPANY FROM MAKING FALSE CLAIMS ABOUT APP THAT CAN DIAGNOSE MELONOMA RISK
FROM: U.S. FEDERAL TRADE COMMISSION
FTC Approves Final Order Barring Misleading Claims about App’s Ability to Diagnose or Assess the Risk of Melanoma
Following a public comment period, the Federal Trade Commission has approved a final consent order barring Health Discovery Corporation from making deceptive or unsupported claims that its app, MelApp, could help diagnose or assess consumers’ melanoma risk.
According to the FTC’s February 2015 complaint, MelApp instructed users to photograph a mole with a smartphone camera and input other information. It would then supposedly calculate the mole’s melanoma risk as low, medium, or high. The FTC charged that Health Discovery Corporation deceptively claimed the app accurately analyzed melanoma risk and could assess such risk in early stages, and that its accuracy was scientifically proven.
The final order settling the action bars the company from claiming that any device detects or diagnoses melanoma or its risk factors, or increases users’ chances of early detection, unless the representation is not misleading and is supported by competent and reliable scientific evidence. It also prohibits Health Discovery Corporation from making any other deceptive claims about a device’s health benefits or efficacy, or about the scientific support for any product or service, and requires the company to pay $17,963.
The Commission vote approving the final consent order and was 4-1, with Commissioner Maureen Ohlhausen voting no
FTC Approves Final Order Barring Misleading Claims about App’s Ability to Diagnose or Assess the Risk of Melanoma
Following a public comment period, the Federal Trade Commission has approved a final consent order barring Health Discovery Corporation from making deceptive or unsupported claims that its app, MelApp, could help diagnose or assess consumers’ melanoma risk.
According to the FTC’s February 2015 complaint, MelApp instructed users to photograph a mole with a smartphone camera and input other information. It would then supposedly calculate the mole’s melanoma risk as low, medium, or high. The FTC charged that Health Discovery Corporation deceptively claimed the app accurately analyzed melanoma risk and could assess such risk in early stages, and that its accuracy was scientifically proven.
The final order settling the action bars the company from claiming that any device detects or diagnoses melanoma or its risk factors, or increases users’ chances of early detection, unless the representation is not misleading and is supported by competent and reliable scientific evidence. It also prohibits Health Discovery Corporation from making any other deceptive claims about a device’s health benefits or efficacy, or about the scientific support for any product or service, and requires the company to pay $17,963.
The Commission vote approving the final consent order and was 4-1, with Commissioner Maureen Ohlhausen voting no
Thursday, April 16, 2015
EXPORT-IMPORT BANK CHAIRMAN PROMOTES TRADE LEGISLATION INTRODUCED IN CONGRESS
FROM: U.S. EXPORT IMPORT BANK
Export-Import Bank Chairman Fred P. Hochberg’s Statement on the Bipartisan Trade Priorities and Accountability Act of 2015
Washington, D.C. – Export-Import Bank Chairman and President Fred P. Hochberg issued the following statement today in reaction to the introduction of the Bipartisan Trade Priorities and Accountability Act of 2015:
“Trade promotion legislation is a critical bipartisan tool that will lead to expanded opportunity for U.S. exporters and the millions of American workers whose jobs depend on trade. As Ex-Im Bank pursues its mission of empowering U.S. businesses to take on stiff foreign competition and bring more good-paying jobs to our shores—and as more and more American small businesses join the ranks of direct exporters—TPA will ensure that the U.S. continues to have a strong voice in writing the rules of the road where global trade is concerned. With critical trade agreements such as the Trans-Pacific Partnership on the horizon, TPA will be essential to ensuring that the U.S. continues to compete on a level playing field, and that American workers will be able to seize the opportunities made possible by trade for generations to come.”
ABOUT EX-IM BANK:
Ex-Im Bank is an independent federal agency that supports and maintains U.S. jobs by filling gaps in private export financing at no cost to American taxpayers. The Bank provides a variety of financing mechanisms, including working capital guarantees and export credit insurance, to promote the sale of U.S. goods and services abroad. Ninety percent of its transactions directly serve American small businesses.
In fiscal year 2014, Ex-Im Bank approved $20.5 billion in total authorizations. These authorizations supported an estimated $27.5 billion in U.S. export sales, as well as approximately 164,000 American jobs in communities across the country.
Export-Import Bank Chairman Fred P. Hochberg’s Statement on the Bipartisan Trade Priorities and Accountability Act of 2015
Washington, D.C. – Export-Import Bank Chairman and President Fred P. Hochberg issued the following statement today in reaction to the introduction of the Bipartisan Trade Priorities and Accountability Act of 2015:
“Trade promotion legislation is a critical bipartisan tool that will lead to expanded opportunity for U.S. exporters and the millions of American workers whose jobs depend on trade. As Ex-Im Bank pursues its mission of empowering U.S. businesses to take on stiff foreign competition and bring more good-paying jobs to our shores—and as more and more American small businesses join the ranks of direct exporters—TPA will ensure that the U.S. continues to have a strong voice in writing the rules of the road where global trade is concerned. With critical trade agreements such as the Trans-Pacific Partnership on the horizon, TPA will be essential to ensuring that the U.S. continues to compete on a level playing field, and that American workers will be able to seize the opportunities made possible by trade for generations to come.”
ABOUT EX-IM BANK:
Ex-Im Bank is an independent federal agency that supports and maintains U.S. jobs by filling gaps in private export financing at no cost to American taxpayers. The Bank provides a variety of financing mechanisms, including working capital guarantees and export credit insurance, to promote the sale of U.S. goods and services abroad. Ninety percent of its transactions directly serve American small businesses.
In fiscal year 2014, Ex-Im Bank approved $20.5 billion in total authorizations. These authorizations supported an estimated $27.5 billion in U.S. export sales, as well as approximately 164,000 American jobs in communities across the country.
SECRETARY KERRY'S STATEMENT REGARDING TRADE PROMOTION AUTHORITY LEGISLATION
FROM: U.S. STATE DEPARTMENT
Bipartisan Congressional Trade Priorities and Accountability Act of 2015
Press Statement
John Kerry
Secretary of State
Washington, DC
April 16, 2015
Our nation’s prosperity and security are linked to the entire world. The introduction of the Trade Promotion Authority legislation today in Congress marks an important step in promoting both of those vital interests at the same time we create jobs at home and markets abroad.
I applaud Chairman Orrin Hatch, Ranking Member Ron Wyden, and Chairman Paul Ryan for providing a framework that would allow the United States and its global partners to complete two of the most significant trade agreements in the history of our country, the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (T-TIP) that together will encompass nearly two-thirds of the global economy.
When I was in the Senate, I consistently supported free trade agreements because I know that investment, innovation, and trade are not just the drivers of a strong economy, they are engines of a strong society. And today, as Secretary of State, I am even more convinced that these agreements enhance our American leadership in an interconnected world.
TPP and T-TIP are critical to American economic security, supporting higher paying jobs here at home while leveling the playing field for U.S. businesses abroad. TPP and T-TIP are vital to our national interests by cementing our ties to strategically vital regions and raising standards that are essential to American ideals and ingenuity, including strong environmental protections, high labor standards, a free and open internet, protection of intellectual property rights, and transparency. These agreements will also support U.S. leadership in establishing rules for the global system consistent with America’s longstanding commitment to democracy, freedom, open markets, and the rule of law.
I also welcome the introduction of legislation renewing the African Growth and Opportunity Act and the Generalized System of Preferences, which have been powerful drivers of global development and pillars of our economic and trade engagement with the developing world.
The United States must remain a leader in global trade, and not run the risk of being left on the sidelines while others set the course. I urge Congress to pass TPA without delay.
Bipartisan Congressional Trade Priorities and Accountability Act of 2015
Press Statement
John Kerry
Secretary of State
Washington, DC
April 16, 2015
Our nation’s prosperity and security are linked to the entire world. The introduction of the Trade Promotion Authority legislation today in Congress marks an important step in promoting both of those vital interests at the same time we create jobs at home and markets abroad.
I applaud Chairman Orrin Hatch, Ranking Member Ron Wyden, and Chairman Paul Ryan for providing a framework that would allow the United States and its global partners to complete two of the most significant trade agreements in the history of our country, the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (T-TIP) that together will encompass nearly two-thirds of the global economy.
When I was in the Senate, I consistently supported free trade agreements because I know that investment, innovation, and trade are not just the drivers of a strong economy, they are engines of a strong society. And today, as Secretary of State, I am even more convinced that these agreements enhance our American leadership in an interconnected world.
TPP and T-TIP are critical to American economic security, supporting higher paying jobs here at home while leveling the playing field for U.S. businesses abroad. TPP and T-TIP are vital to our national interests by cementing our ties to strategically vital regions and raising standards that are essential to American ideals and ingenuity, including strong environmental protections, high labor standards, a free and open internet, protection of intellectual property rights, and transparency. These agreements will also support U.S. leadership in establishing rules for the global system consistent with America’s longstanding commitment to democracy, freedom, open markets, and the rule of law.
I also welcome the introduction of legislation renewing the African Growth and Opportunity Act and the Generalized System of Preferences, which have been powerful drivers of global development and pillars of our economic and trade engagement with the developing world.
The United States must remain a leader in global trade, and not run the risk of being left on the sidelines while others set the course. I urge Congress to pass TPA without delay.
PRESIDENT OBAMA'S STATEMENT ON HOLOCAUST REMEMBRANCE DAY
FROM: THE WHITE HOUSE PRESIDENT
April 16, 2015
Statement by the President on Holocaust Remembrance Day
Today, with heavy hearts, we remember the six million Jews and the millions of other victims of Nazi brutality who were murdered during the Holocaust.
Yom HaShoah is a day to reaffirm our responsibilities to ourselves and future generations. It is incumbent upon us to make real those timeless words, “Never forget. Never again.” Yet, even as we recognize that mankind is capable of unspeakable acts of evil, we also draw strength from the survivors, the liberators, and the righteous among nations who represented humanity at its best.
With their example to guide us, together we must firmly and forcefully condemn the anti-Semitism that is still far too common today. Together we must stand against bigotry and hatred in all their forms. And together, we can leave our children a world that is more just, more free, and more secure for all humankind.
SEC FILES FILES CHARGES IN FLORIDA-BASED MICROCAP STOCK SCHEME
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23242 / April 16, 2015
Securities and Exchange Commission v. eCareer Holdings, Inc., eCareer, Inc., Joseph J. Azzata, Dean A. Esposito, Joseph DeVito, and Frederick J. Birks, et al., Civil Action No. 9:15-CV-80446-JIC-COHN (S.D. Fla.)
SEC Halts Microcap Scheme in South Florida
The Securities and Exchange Commission announced that on April 7, 2015, it filed fraud charges and sought an asset freeze against the operators of a South Florida-based microcap scheme, including three boiler room brokers caught trying to conceal from investors that they have been barred from the industry. That same day, the Honorable James I. Cohn, United States District Judge for the Southern District of Florida, entered, among other things, a temporary restraining order, and a freeze of the defendants' and relief defendants' assets.
The SEC alleges that investors were defrauded in cold calls placed to investors through a boiler room spearheaded by Dean A. Esposito of Boca Raton, Fla., Joseph DeVito of Brooklyn, N.Y., and Frederick Birks of Orlando, Fla. These brokers and their sales agents were hired by Joseph J. Azzata of Boca Raton, Fla., CEO of eCareer Holdings, Inc., to sell unregistered stock shares in the company. Investors were told their money would be used as working capital to develop eCareer's online job staffing business, however about 30 percent of investor proceeds has been diverted to pay exorbitant fees to the brokers and sales agents. These payments were mischaracterized in eCareer's corporate filings as dispensed to third parties for consulting and advisory services rather than to the sales agents. Company filings and offering materials also misrepresented that eCareer shares would be sold only to accredited investors when in reality stock has been pitched and sold to people not necessarily meeting that definition, including some non-accredited investors aged 85 to 98 years old.
According to the SEC's complaint unsealed on April 9, 2015, Esposito, DeVito, and Birks were subjects of a prior SEC enforcement action that resulted in them being barred from acting as a broker or dealer or participating in any offering of a penny stock. Therefore, they were prohibited from earning transaction-based compensation from the sale of eCareer's stock. In an attempt to circumvent these prohibitions and disguise the true nature of their compensation, Esposito, DeVito, and Birks and their companies entered into agreements typically signed by Azzata that miscategorized their compensation as advisory fees and finder's fees.
The SEC alleges that eCareer, Azzata, Esposito, DeVito, and Birks fraudulently raised more than $11 million in funds from more than 400 investors since August 2010. In addition to approximately $3.5 million paid out of investor funds in the form of undisclosed exorbitant fees, Azzata diverted $650,000 to pay expenses related to his motorsports hobby as well as other family expenditures such as private school tuition for his children and shopping bills for his wife. Corporate filings by eCareer falsely claimed that private offering funds were used for working capital purposes and concealed Azzata's misappropriation of investor proceeds.
The SEC's complaint charges eCareer, Azzata, Esposito, DeVito and Birks with violating Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933 as well as Section 10(b) of the Securities Exchange Act of 1934 along with Rule 10b-5. The SEC's complaint also charges eCareer Holdings, Inc. for its violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-1, and 13a-13, and the complaint charges Azzata for aiding and abetting and control person liability for eCareer's violations among other violations. The SEC seeks disgorgement of ill-gotten gains, prejudgment interest, and financial penalties among other relief for investors. The court has granted the SEC's request for a temporary restraining order and temporary asset freeze, and temporarily barred Azzata from serving as an officer or director of eCareer Holdings and voting the company's shares.
The SEC also suspended trading in shares of eCareer Holdings due to questions that have arisen about the accuracy and adequacy of publicly disseminated information in its filings. More information about the trading suspension process is available in an SEC investor bulletin on the topic.
The SEC's investigation, which is continuing, is being conducted by Linda S. Schmidt and Fernando Torres in the Miami Regional Office. The case is being supervised by Jason R. Berkowitz, and the SEC's litigation is being led by Christopher E. Martin. The SEC appreciates the assistance of Florida's Office of Financial Regulation.
Litigation Release No. 23242 / April 16, 2015
Securities and Exchange Commission v. eCareer Holdings, Inc., eCareer, Inc., Joseph J. Azzata, Dean A. Esposito, Joseph DeVito, and Frederick J. Birks, et al., Civil Action No. 9:15-CV-80446-JIC-COHN (S.D. Fla.)
SEC Halts Microcap Scheme in South Florida
The Securities and Exchange Commission announced that on April 7, 2015, it filed fraud charges and sought an asset freeze against the operators of a South Florida-based microcap scheme, including three boiler room brokers caught trying to conceal from investors that they have been barred from the industry. That same day, the Honorable James I. Cohn, United States District Judge for the Southern District of Florida, entered, among other things, a temporary restraining order, and a freeze of the defendants' and relief defendants' assets.
The SEC alleges that investors were defrauded in cold calls placed to investors through a boiler room spearheaded by Dean A. Esposito of Boca Raton, Fla., Joseph DeVito of Brooklyn, N.Y., and Frederick Birks of Orlando, Fla. These brokers and their sales agents were hired by Joseph J. Azzata of Boca Raton, Fla., CEO of eCareer Holdings, Inc., to sell unregistered stock shares in the company. Investors were told their money would be used as working capital to develop eCareer's online job staffing business, however about 30 percent of investor proceeds has been diverted to pay exorbitant fees to the brokers and sales agents. These payments were mischaracterized in eCareer's corporate filings as dispensed to third parties for consulting and advisory services rather than to the sales agents. Company filings and offering materials also misrepresented that eCareer shares would be sold only to accredited investors when in reality stock has been pitched and sold to people not necessarily meeting that definition, including some non-accredited investors aged 85 to 98 years old.
According to the SEC's complaint unsealed on April 9, 2015, Esposito, DeVito, and Birks were subjects of a prior SEC enforcement action that resulted in them being barred from acting as a broker or dealer or participating in any offering of a penny stock. Therefore, they were prohibited from earning transaction-based compensation from the sale of eCareer's stock. In an attempt to circumvent these prohibitions and disguise the true nature of their compensation, Esposito, DeVito, and Birks and their companies entered into agreements typically signed by Azzata that miscategorized their compensation as advisory fees and finder's fees.
The SEC alleges that eCareer, Azzata, Esposito, DeVito, and Birks fraudulently raised more than $11 million in funds from more than 400 investors since August 2010. In addition to approximately $3.5 million paid out of investor funds in the form of undisclosed exorbitant fees, Azzata diverted $650,000 to pay expenses related to his motorsports hobby as well as other family expenditures such as private school tuition for his children and shopping bills for his wife. Corporate filings by eCareer falsely claimed that private offering funds were used for working capital purposes and concealed Azzata's misappropriation of investor proceeds.
The SEC's complaint charges eCareer, Azzata, Esposito, DeVito and Birks with violating Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933 as well as Section 10(b) of the Securities Exchange Act of 1934 along with Rule 10b-5. The SEC's complaint also charges eCareer Holdings, Inc. for its violations of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-1, and 13a-13, and the complaint charges Azzata for aiding and abetting and control person liability for eCareer's violations among other violations. The SEC seeks disgorgement of ill-gotten gains, prejudgment interest, and financial penalties among other relief for investors. The court has granted the SEC's request for a temporary restraining order and temporary asset freeze, and temporarily barred Azzata from serving as an officer or director of eCareer Holdings and voting the company's shares.
The SEC also suspended trading in shares of eCareer Holdings due to questions that have arisen about the accuracy and adequacy of publicly disseminated information in its filings. More information about the trading suspension process is available in an SEC investor bulletin on the topic.
The SEC's investigation, which is continuing, is being conducted by Linda S. Schmidt and Fernando Torres in the Miami Regional Office. The case is being supervised by Jason R. Berkowitz, and the SEC's litigation is being led by Christopher E. Martin. The SEC appreciates the assistance of Florida's Office of Financial Regulation.
DEFENSE SECRETARY CARTER MEETS WITH IRAQI DEFENSE MINISTER TO REAFFIRM COMMITMENT
Right: Defense Secretary Ash Carter, center left, hosts an honor cordon to welcome Iraqi Defense Minister Khalid al-Obeidi, center right, to the Pentagon, April 14, 2015. DoD photo by Army Sgt. 1st Class Clydell Kinchen.
Carter, Iraqi Defense Minister Reaffirm Commitment
DoD News, Defense Media Activity
WASHINGTON, April 15, 2015 – Bilateral cooperation and progress in countering the Islamic State of Iraq and the Levant terrorists highlighted a meeting at the Pentagon yesterday between Defense Secretary Ash Carter and Iraqi Defense Minister Khalid al-Obeidi.
In a statement summarizing the meeting, Pentagon officials said the two leaders reaffirmed their commitment to degrading and ultimately defeating ISIL, focusing on the next steps in the effort.
Carter also congratulated Obeidi on Iraq's successful retaking of Tikrit and reiterated the Defense Department's strong support for Iraqi-led counter-ISIL efforts, officials said. The secretary also emphasized the importance of inclusive governance and respect for local populations in Tikrit and all areas liberated from ISIL control, they added.
Equipping Efforts, Support for Forces
The two defense leaders also coordinated views on current U.S. equipping efforts, the statement said, and discussed how the United States can best support the Iraqi security forces, Kurdish peshmerga and Sunni tribal fighters.
“Both leaders expressed hopes that this productive meeting would lay the foundation for further cooperation between the armed services of the U.S. and Iraq,” the statement said.
PRESIDENT OBAMA'S REMARKS ON EBOLA BEFORE MEETING WITH WEST AFRICAN LEADERS
FROM: THE WHITE HOUSE
April 15, 2015
Remarks by the President Before Meeting with West African Leaders on Ebola
CABINET ROOM
10:45 A.M. EDT
THE PRESIDENT: Well, I want to welcome Presidents Sirleaf, Koroma and Condé. The United States has a long partnership with Liberia and Sierra Leone and Guinea -- partnerships that prove to be critical in the fight against Ebola. We’re here to assess progress today and to look ahead.
We begin by noting the incredible losses that took place in all three countries. More than 10,000 people have died from Ebola -- men, women and children. On behalf of the American people, we want to express our deepest condolences to the families and recognize how challenging this has been for all the countries involved.
Under extraordinary circumstances, the people of these three countries have shown great courage and resolve, treating and taking care of each other, especially children and orphans. The United States has been proud to lead an international effort to work with these three countries in a global response.
Last week, there were fewer than 40 new cases, so we’ve seen major progress. In Liberia right now, there are zero cases. In Sierra Leone and Guinea combined, there were fewer than 40 new cases last week and that’s around the lowest number in a year. Now we’re focused on a shared goal, and that is getting to zero. We can’t be complacent. This virus is unpredictable.
We have to be vigilant, and the international community has to remain fully engaged in a partnership with these three countries until there are no cases of Ebola in these countries. Health systems also have to be rebuilt to meet daily needs -- vaccines for measles, delivering babies safely, treating HIV/AIDS and malaria. And with our Global Health Security Agenda, we intend to do more to prevent future epidemics.
So the Ebola epidemic has been also an economic crisis. That’s part of the reason why these three presidents are here. They’re going to be meeting with a number of the multilateral institutions -- the IMF and World Bank here in Washington. There’s the challenge of restoring markets and agricultural growth, promoting investment and development. So I’m going to be looking forward to hearing from them on how the United States can stand shoulder to shoulder with them to work hard to take this crisis and turn it into an opportunity to rebuild even stronger than before: To strengthen administrative systems, public health systems, to continue the work that they’ve done in rooting out corruption, reinforcing democratic institutions -- all of which will be the foundation stones for long-term progress and prosperity.
So Madam President, Mr. Presidents, we are very grateful for the hard work that you’ve done. We’re proud to partner with you and we intend to see this through until the job is done.
Thank you, everybody.
END
April 15, 2015
Remarks by the President Before Meeting with West African Leaders on Ebola
CABINET ROOM
10:45 A.M. EDT
THE PRESIDENT: Well, I want to welcome Presidents Sirleaf, Koroma and Condé. The United States has a long partnership with Liberia and Sierra Leone and Guinea -- partnerships that prove to be critical in the fight against Ebola. We’re here to assess progress today and to look ahead.
We begin by noting the incredible losses that took place in all three countries. More than 10,000 people have died from Ebola -- men, women and children. On behalf of the American people, we want to express our deepest condolences to the families and recognize how challenging this has been for all the countries involved.
Under extraordinary circumstances, the people of these three countries have shown great courage and resolve, treating and taking care of each other, especially children and orphans. The United States has been proud to lead an international effort to work with these three countries in a global response.
Last week, there were fewer than 40 new cases, so we’ve seen major progress. In Liberia right now, there are zero cases. In Sierra Leone and Guinea combined, there were fewer than 40 new cases last week and that’s around the lowest number in a year. Now we’re focused on a shared goal, and that is getting to zero. We can’t be complacent. This virus is unpredictable.
We have to be vigilant, and the international community has to remain fully engaged in a partnership with these three countries until there are no cases of Ebola in these countries. Health systems also have to be rebuilt to meet daily needs -- vaccines for measles, delivering babies safely, treating HIV/AIDS and malaria. And with our Global Health Security Agenda, we intend to do more to prevent future epidemics.
So the Ebola epidemic has been also an economic crisis. That’s part of the reason why these three presidents are here. They’re going to be meeting with a number of the multilateral institutions -- the IMF and World Bank here in Washington. There’s the challenge of restoring markets and agricultural growth, promoting investment and development. So I’m going to be looking forward to hearing from them on how the United States can stand shoulder to shoulder with them to work hard to take this crisis and turn it into an opportunity to rebuild even stronger than before: To strengthen administrative systems, public health systems, to continue the work that they’ve done in rooting out corruption, reinforcing democratic institutions -- all of which will be the foundation stones for long-term progress and prosperity.
So Madam President, Mr. Presidents, we are very grateful for the hard work that you’ve done. We’re proud to partner with you and we intend to see this through until the job is done.
Thank you, everybody.
END
PRESIDENT'S STATEMENT ON FIX TO MEDICARE PHYSICIAN PAYMENT SYSTEM
FROM: THE WHITE HOUSE
April 14, 2015
Statement by the President on the Passage of a Permanent Fix to the Medicare Physician Payment System
I applaud the Members of Congress from both parties who came together to pass the Medicare Access and CHIP Reauthorization Act.
Nearly every year for the past 13 years, physicians have faced the possibility of an arbitrary cut in their payments from Medicare unless Congress passed a so-called “doc fix.” In my budget, I called for putting a permanent end to this annual manufactured crisis to ensure that doctors will not face a sudden drop in their pay. This bill is consistent with that proposal – it’s a milestone for physicians, and for the seniors and people with disabilities who rely on Medicare for their health care needs.
This bill also strengthens our country’s health care system for the long term. It more directly rewards providers for better-quality care. It creates incentives to encourage physicians to participate in new, innovative payment models that could further reduce the growth in Medicare spending while preserving access to care. And it extends the Children’s Health Insurance Program, which has provided coverage to millions of American children.
This bipartisan bill will protect health coverage for millions of Americans, and I will be proud to sign it into law. I hope Congress builds on this good work by finding more ways to make sure every American has access to the quality, affordable health care they deserve.
April 14, 2015
Statement by the President on the Passage of a Permanent Fix to the Medicare Physician Payment System
I applaud the Members of Congress from both parties who came together to pass the Medicare Access and CHIP Reauthorization Act.
Nearly every year for the past 13 years, physicians have faced the possibility of an arbitrary cut in their payments from Medicare unless Congress passed a so-called “doc fix.” In my budget, I called for putting a permanent end to this annual manufactured crisis to ensure that doctors will not face a sudden drop in their pay. This bill is consistent with that proposal – it’s a milestone for physicians, and for the seniors and people with disabilities who rely on Medicare for their health care needs.
This bill also strengthens our country’s health care system for the long term. It more directly rewards providers for better-quality care. It creates incentives to encourage physicians to participate in new, innovative payment models that could further reduce the growth in Medicare spending while preserving access to care. And it extends the Children’s Health Insurance Program, which has provided coverage to millions of American children.
This bipartisan bill will protect health coverage for millions of Americans, and I will be proud to sign it into law. I hope Congress builds on this good work by finding more ways to make sure every American has access to the quality, affordable health care they deserve.
WHITE HOUSE FACT SHEET: U.S.-IRAQ COOPERATION
FROM: THE WHITE HOUSE
FACT SHEET: U.S.-Iraq Cooperation
The strategic partnership between the United States and the Republic of Iraq spans a wide-range of sectors, consistent with the U.S.-Iraq Strategic Framework Agreement. Below is a selection of key areas of cooperation that demonstrates the expansiveness of this important bilateral relationship.
Defense and Security: The United States and Iraq are committed to promoting stability in Iraq and the region through an enduring partnership that supports our goal to degrade and ultimately destroy ISIL, enhances Iraqi defense capabilities, re-establishes the security of Iraq’s borders, modernizes its forces, and supports Iraq’s contributions to regional security.
The United States and Iraq have made progress in the fight to degrade and ultimately destroy ISIL. In the past eight months, more than 1,900 U.S. and coalition airstrikes have blunted ISIL’s momentum in Iraq and degraded its military capability. As a result of this coordinated effort ISIL has lost control of approximately 25 to 30 percent of the populated areas it had seized in Iraq. Iraqi forces have retaken critical areas of the country, including the Mosul Dam, Sinjar Mountain, Diyala, Tikrit, and areas near Kirkuk. In both Iraq and Syria, over 3,200 U.S. and coalition strikes have damaged or destroyed over 5,780 ISIL targets including 75 tanks and 285 Humvees in ISIL control, 1,166 ISIL fighting positions, and 151 oil infrastructure-related targets that ISIL operated.
Teams of U.S. and coalition personnel are supporting efforts to advise and assist Iraqi Security Forces (ISF), including Peshmerga forces, in planning military operations, intelligence sharing, integrating air support and land operations, managing logistics, command and control of forces, and communications. These teams are also assisting the Iraqi government as they train and equip Sunni tribal fighters as recruits into the Popular Mobilization Forces in Anbar and Ninewa provinces.
Since the fall of 2014, the United States has delivered essential equipment to Iraq as a critical component of the coalition fight against ISIL, including: over 100 million rounds of ammunition, 62,000 small arms systems, 1,700 Hellfire missiles, and six M1A1 tanks. In addition, the U.S. provided to the Government of Iraq 250 Mine-Resistant Ambush Protected (MRAP) vehicles in December 2014 and January 2015, 25 of which were subsequently provided to Kurdish forces in Erbil. The Peshmerga received 1,000 Anti-Tank Missiles that were delivered through the Government of Iraq. As of this week, an additional 50 MRAPs with mine rollers will be on their way to Iraq. In addition to ammunition and vehicles, the United States has also delivered over 12,000 rifles, body armor, helmets, and first aid kits – the equivalent of roughly 5-6 brigades’ worth of individual soldier weapons and equipment. The United States continues to work with the Government of Iraq to deliver their F-16 fighter aircraft to Iraq, and there are currently 30 Iraqi Air Force pilots in the training pipeline.
Deliveries and donations from coalition countries have also been critical to the equipping effort. The coalition has conducted over 70 flights carrying over 5 million pounds of materiel donated by 17 countries, to support the Government of Iraq’s fight against ISIL.
The $1.6-billion Iraq Train and Equip Fund (ITEF) has enabled the United States to provide training and equipment to the ISF, including Peshmerga troops and tribal volunteers, with strong support from coalition partners. Four Building Partner Capacity sites have been established, in Al Asad, Besmayah, Taji, and Erbil - and almost 6,500 ISF, including Peshmerga, have already completed instruction, with more than 4,900 currently in training. Additional equipment funded by ITEF has also begun to arrive in Iraq including individual soldier gear and weapons. Armored vehicles, communications systems, and other equipment and munitions to support roughly 20,000 Iraqi fighters will follow shortly.
Foreign Military Financing (FMF)—grants for the acquisition of U.S. defense equipment, services, and training—will continue to support the long-term development of ISF capabilities. Since 2013, $771 million in FMF and more than $2.5 million in International Military Education and Training has gone towards the development of Iraq’s military. FMF has supported ISF logistics capacity building, professionalization and training, platform-specific sustainment, border security, and equipment to support Iraqi counter terrorism forces.
Political, Diplomatic, and Humanitarian Assistance: The United States supports Iraq’s efforts to develop an inclusive government that promotes security, prosperity and human rights for all Iraqis, and to enhance ties with its regional neighbors.
The United States is providing an additional $205 million in humanitarian assistance to assist millions of Iraqi civilians – both refugees in the region and internally displaced persons within the country – who have been affected by ISIL attacks and previous instability, providing them with food, shelter, water, medical services, cash assistance, and other essential goods and services. It will help displaced persons and refugees obtain legal documentation, strengthen child protection, and improve management at IDP camps. With this new funding, the United States has provided more than $407 million in humanitarian assistance to the Iraqi people since the start of fiscal year 2014.
The United States is working closely with Iraq and coalition members to help Iraq develop a plan to stabilize areas liberated from ISIL-control and to identify resources to support Iraqi stabilization efforts and facilitate their delivery. In March, a team of stabilization experts from the United States joined experts from the coalition and the United Nations in a conference with the Government of Iraq to assess the government’s readiness to address the immediate needs of liberated areas.
Strengthening Iraq’s federal system is a key plank of Prime Minister Abadi’s national program, and is a key pillar of the Government of Iraq’s strategy to improve governance and stabilize the country. The U.S. Agency for International Development's (USAID's) Service Delivery Project (Taqadum) supports the Government of Iraq's efforts to decentralize responsibilities for service delivery from three central ministries, which serves as a model from which other national ministries can emulate. We are also committed to supporting inclusive governance in Iraq and promoting reconciliation. The State Department is targeting over $17 million in fiscal year 2014 funding for programs which include activities to address human rights and rule of law as well as atrocities prevention and accountability issues – key areas for building reconciliation and contributing to the stabilization of Iraq.
Energy: The United States and Iraq are committed to the secure, efficient, resilient, and transparent development of Iraq’s electricity, oil, and gas sectors in an effort to build a strong economy that is capable of meeting the needs of the Iraqi people and bringing greater stability to world markets.
The United States and the Government of Iraq, acting pursuant to a 2013 Memorandum of Understanding, have developed a Joint Action Plan to address energy cooperation and the protection of critical infrastructure. In April 2015, the United States and Iraq completed the first phase of the Work Plan for Critical Energy Infrastructure Protection, which prioritizes strategic projects for U.S. and Iraqi collaboration in securing Iraq’s energy infrastructure.
The Department of Commerce’s Commercial Law Development Program brought together U.S. and international experts to share their natural gas contracting expertise with contract specialists in Iraq’s Ministry of Oil and Ministry of Electricity in March 2014.
Trade & Finance: The United States and Iraq support the development of a prosperous and diversified Iraqi economy that is integrated into the global economic system and also efforts to partner on programs to develop Iraq’s economy, expand bilateral trade, enhance macroeconomic and fiscal stability, and protect Iraqi financial institutions from exploitation by ISIL.
During the inaugural Trade and Investment Framework Agreement meeting in March 2014, Iraq and the United States addressed trade issues that would improve the U.S. – Iraq bilateral trade and investment relationship. Iraq committed to improving its business climate, and the United States– through a series of ongoing capacity building and training engagements across Iraq’s relevant Ministries – remains committed to support these efforts.
U.S. companies remain actively engaged in Iraq. U.S. goods exports to Iraq increased by approximately 4.2 percent and U.S. imports from Iraq rose 3 percent from 2013 to 2014. Several U.S. franchises established or expanded branches in Iraq. The cities of Houston and Basrah have strengthened their bilateral trade as well as their educational and cultural exchanges through the existing Basrah – Houston City Partnership.
In July 2014 the Central Bank of Iraq issued directives to Iraqi financial institutions within ISIL-held territory to cease financial activity. The Department of the Treasury continues to engage with the Central Bank of Iraq to ensure these directives are implemented and restrict ISIL’s access to the Iraqi and international financial systems.
In response to a request from the Iraqi Ministry of Finance, the United States is planning to provide targeted technical expertise on public financial management issues pending Congressional approval of funding. The program will help the Government of Iraq mitigate the fiscal impacts arising from ISIL’s attacks and a precipitous drop in oil prices.
The United States and Iraq are eager to spur private sector development in Iraq. USAID's Administrative Reform project (Tarabot) works with Iraqi ministries to streamline regulations and improve procurement processes in order to better manage resources and create business opportunities.
Education and Culture: The United States and Iraq strongly support a strengthened Iraqi higher education system, the preservation and promotion of Iraq’s rich cultural heritage, and expansion of educational, cultural, and professional exchanges between our nations.
During the 2013-2014 academic year, nearly 1,500 Iraqi students attended U.S. universities, an increase of 33 percent over the previous year. The United States continues to work with the Iraqi government to expand its networks of partner institutions and increase its engagement with U.S. universities.
Each year approximately 500 Iraqis participate in U.S. government academic, cultural, and professional exchange programs.
From 2010-2014, the Iraq University Linkage Program linked seven U.S. universities with seven Iraqi universities to develop curricula, train faculty, improve English language training capacity, and create career centers to facilitate job placement.
The United States returned to the Government of Iraq numerous items of cultural heritage that had been removed unlawfully from Iraq and seized by Department of Homeland Security agents, including the sculptured head in the style of the Assyrian King Sargon II. U.S. funding in support of the Iraqi Institute for the Conservation of Antiquities and Heritage (IICAH) has provided technical expertise in a variety of preservation areas to Iraqi antiquities specialists from throughout the country.
The United States supported major renovations to the galleries, storerooms, laboratories, and climate control systems of the Iraq Museum in Baghdad, which has just reopened to the Iraqi public. Through the Ambassador’s Fund for Cultural Preservation, the State Department has invested nearly $3 million since 2010 in emergency stabilization and conservation of the Ishtar gate and other major structures and artifacts in Babylon.
FACT SHEET: U.S.-Iraq Cooperation
The strategic partnership between the United States and the Republic of Iraq spans a wide-range of sectors, consistent with the U.S.-Iraq Strategic Framework Agreement. Below is a selection of key areas of cooperation that demonstrates the expansiveness of this important bilateral relationship.
Defense and Security: The United States and Iraq are committed to promoting stability in Iraq and the region through an enduring partnership that supports our goal to degrade and ultimately destroy ISIL, enhances Iraqi defense capabilities, re-establishes the security of Iraq’s borders, modernizes its forces, and supports Iraq’s contributions to regional security.
The United States and Iraq have made progress in the fight to degrade and ultimately destroy ISIL. In the past eight months, more than 1,900 U.S. and coalition airstrikes have blunted ISIL’s momentum in Iraq and degraded its military capability. As a result of this coordinated effort ISIL has lost control of approximately 25 to 30 percent of the populated areas it had seized in Iraq. Iraqi forces have retaken critical areas of the country, including the Mosul Dam, Sinjar Mountain, Diyala, Tikrit, and areas near Kirkuk. In both Iraq and Syria, over 3,200 U.S. and coalition strikes have damaged or destroyed over 5,780 ISIL targets including 75 tanks and 285 Humvees in ISIL control, 1,166 ISIL fighting positions, and 151 oil infrastructure-related targets that ISIL operated.
Teams of U.S. and coalition personnel are supporting efforts to advise and assist Iraqi Security Forces (ISF), including Peshmerga forces, in planning military operations, intelligence sharing, integrating air support and land operations, managing logistics, command and control of forces, and communications. These teams are also assisting the Iraqi government as they train and equip Sunni tribal fighters as recruits into the Popular Mobilization Forces in Anbar and Ninewa provinces.
Since the fall of 2014, the United States has delivered essential equipment to Iraq as a critical component of the coalition fight against ISIL, including: over 100 million rounds of ammunition, 62,000 small arms systems, 1,700 Hellfire missiles, and six M1A1 tanks. In addition, the U.S. provided to the Government of Iraq 250 Mine-Resistant Ambush Protected (MRAP) vehicles in December 2014 and January 2015, 25 of which were subsequently provided to Kurdish forces in Erbil. The Peshmerga received 1,000 Anti-Tank Missiles that were delivered through the Government of Iraq. As of this week, an additional 50 MRAPs with mine rollers will be on their way to Iraq. In addition to ammunition and vehicles, the United States has also delivered over 12,000 rifles, body armor, helmets, and first aid kits – the equivalent of roughly 5-6 brigades’ worth of individual soldier weapons and equipment. The United States continues to work with the Government of Iraq to deliver their F-16 fighter aircraft to Iraq, and there are currently 30 Iraqi Air Force pilots in the training pipeline.
Deliveries and donations from coalition countries have also been critical to the equipping effort. The coalition has conducted over 70 flights carrying over 5 million pounds of materiel donated by 17 countries, to support the Government of Iraq’s fight against ISIL.
The $1.6-billion Iraq Train and Equip Fund (ITEF) has enabled the United States to provide training and equipment to the ISF, including Peshmerga troops and tribal volunteers, with strong support from coalition partners. Four Building Partner Capacity sites have been established, in Al Asad, Besmayah, Taji, and Erbil - and almost 6,500 ISF, including Peshmerga, have already completed instruction, with more than 4,900 currently in training. Additional equipment funded by ITEF has also begun to arrive in Iraq including individual soldier gear and weapons. Armored vehicles, communications systems, and other equipment and munitions to support roughly 20,000 Iraqi fighters will follow shortly.
Foreign Military Financing (FMF)—grants for the acquisition of U.S. defense equipment, services, and training—will continue to support the long-term development of ISF capabilities. Since 2013, $771 million in FMF and more than $2.5 million in International Military Education and Training has gone towards the development of Iraq’s military. FMF has supported ISF logistics capacity building, professionalization and training, platform-specific sustainment, border security, and equipment to support Iraqi counter terrorism forces.
Political, Diplomatic, and Humanitarian Assistance: The United States supports Iraq’s efforts to develop an inclusive government that promotes security, prosperity and human rights for all Iraqis, and to enhance ties with its regional neighbors.
The United States is providing an additional $205 million in humanitarian assistance to assist millions of Iraqi civilians – both refugees in the region and internally displaced persons within the country – who have been affected by ISIL attacks and previous instability, providing them with food, shelter, water, medical services, cash assistance, and other essential goods and services. It will help displaced persons and refugees obtain legal documentation, strengthen child protection, and improve management at IDP camps. With this new funding, the United States has provided more than $407 million in humanitarian assistance to the Iraqi people since the start of fiscal year 2014.
The United States is working closely with Iraq and coalition members to help Iraq develop a plan to stabilize areas liberated from ISIL-control and to identify resources to support Iraqi stabilization efforts and facilitate their delivery. In March, a team of stabilization experts from the United States joined experts from the coalition and the United Nations in a conference with the Government of Iraq to assess the government’s readiness to address the immediate needs of liberated areas.
Strengthening Iraq’s federal system is a key plank of Prime Minister Abadi’s national program, and is a key pillar of the Government of Iraq’s strategy to improve governance and stabilize the country. The U.S. Agency for International Development's (USAID's) Service Delivery Project (Taqadum) supports the Government of Iraq's efforts to decentralize responsibilities for service delivery from three central ministries, which serves as a model from which other national ministries can emulate. We are also committed to supporting inclusive governance in Iraq and promoting reconciliation. The State Department is targeting over $17 million in fiscal year 2014 funding for programs which include activities to address human rights and rule of law as well as atrocities prevention and accountability issues – key areas for building reconciliation and contributing to the stabilization of Iraq.
Energy: The United States and Iraq are committed to the secure, efficient, resilient, and transparent development of Iraq’s electricity, oil, and gas sectors in an effort to build a strong economy that is capable of meeting the needs of the Iraqi people and bringing greater stability to world markets.
The United States and the Government of Iraq, acting pursuant to a 2013 Memorandum of Understanding, have developed a Joint Action Plan to address energy cooperation and the protection of critical infrastructure. In April 2015, the United States and Iraq completed the first phase of the Work Plan for Critical Energy Infrastructure Protection, which prioritizes strategic projects for U.S. and Iraqi collaboration in securing Iraq’s energy infrastructure.
The Department of Commerce’s Commercial Law Development Program brought together U.S. and international experts to share their natural gas contracting expertise with contract specialists in Iraq’s Ministry of Oil and Ministry of Electricity in March 2014.
Trade & Finance: The United States and Iraq support the development of a prosperous and diversified Iraqi economy that is integrated into the global economic system and also efforts to partner on programs to develop Iraq’s economy, expand bilateral trade, enhance macroeconomic and fiscal stability, and protect Iraqi financial institutions from exploitation by ISIL.
During the inaugural Trade and Investment Framework Agreement meeting in March 2014, Iraq and the United States addressed trade issues that would improve the U.S. – Iraq bilateral trade and investment relationship. Iraq committed to improving its business climate, and the United States– through a series of ongoing capacity building and training engagements across Iraq’s relevant Ministries – remains committed to support these efforts.
U.S. companies remain actively engaged in Iraq. U.S. goods exports to Iraq increased by approximately 4.2 percent and U.S. imports from Iraq rose 3 percent from 2013 to 2014. Several U.S. franchises established or expanded branches in Iraq. The cities of Houston and Basrah have strengthened their bilateral trade as well as their educational and cultural exchanges through the existing Basrah – Houston City Partnership.
In July 2014 the Central Bank of Iraq issued directives to Iraqi financial institutions within ISIL-held territory to cease financial activity. The Department of the Treasury continues to engage with the Central Bank of Iraq to ensure these directives are implemented and restrict ISIL’s access to the Iraqi and international financial systems.
In response to a request from the Iraqi Ministry of Finance, the United States is planning to provide targeted technical expertise on public financial management issues pending Congressional approval of funding. The program will help the Government of Iraq mitigate the fiscal impacts arising from ISIL’s attacks and a precipitous drop in oil prices.
The United States and Iraq are eager to spur private sector development in Iraq. USAID's Administrative Reform project (Tarabot) works with Iraqi ministries to streamline regulations and improve procurement processes in order to better manage resources and create business opportunities.
Education and Culture: The United States and Iraq strongly support a strengthened Iraqi higher education system, the preservation and promotion of Iraq’s rich cultural heritage, and expansion of educational, cultural, and professional exchanges between our nations.
During the 2013-2014 academic year, nearly 1,500 Iraqi students attended U.S. universities, an increase of 33 percent over the previous year. The United States continues to work with the Iraqi government to expand its networks of partner institutions and increase its engagement with U.S. universities.
Each year approximately 500 Iraqis participate in U.S. government academic, cultural, and professional exchange programs.
From 2010-2014, the Iraq University Linkage Program linked seven U.S. universities with seven Iraqi universities to develop curricula, train faculty, improve English language training capacity, and create career centers to facilitate job placement.
The United States returned to the Government of Iraq numerous items of cultural heritage that had been removed unlawfully from Iraq and seized by Department of Homeland Security agents, including the sculptured head in the style of the Assyrian King Sargon II. U.S. funding in support of the Iraqi Institute for the Conservation of Antiquities and Heritage (IICAH) has provided technical expertise in a variety of preservation areas to Iraqi antiquities specialists from throughout the country.
The United States supported major renovations to the galleries, storerooms, laboratories, and climate control systems of the Iraq Museum in Baghdad, which has just reopened to the Iraqi public. Through the Ambassador’s Fund for Cultural Preservation, the State Department has invested nearly $3 million since 2010 in emergency stabilization and conservation of the Ishtar gate and other major structures and artifacts in Babylon.
INVESTOR ADVOCATE RICK FLEMING ON SMART REGULATION
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
The Importance of Smart Regulation
Rick A. Fleming, Investor Advocate
U.S. Securities and Exchange Commission[1]
NASAA Public Policy Conference
Mayflower Renaissance Hotel
Keynote Luncheon
Washington, D.C.
April 14, 2015
Thank you, [Bill Beatty], for the nice introduction, and for the opportunity to come back and visit many old friends.
Thanks, also, to all of you who participated in the 19(d) meetings this morning.[2] This is an important opportunity for state and federal collaboration, and I would remind my new friends at the SEC that Section 19(d) of the Securities Act provides for much more than a once-a-year gathering. It envisions an atmosphere in which the states are considered partners in certain types of rulemakings, not mere commenters.[3]
Today, I want to talk about the business of regulating, and why it is so important that you do your jobs well. Of course, the views I express are my own and do not necessarily reflect those of the Commission, the Commissioners, or my colleagues on the Commission staff.
As you know, many people start with an assumption that all regulation is bad for business. Some lobbyists and politicians in D.C. certainly believe this, and while they may pay lip service to investor protection, the result of their consistent policy positions would leave investors naked and hungry. I am also aware that, sadly, some of your bosses back home harbor a fundamental belief that your work is an impediment to economic growth.
Unfortunately, we sometimes contribute to this misconception. Over the course of my career, I have often given speeches in which I have portrayed securities regulation as a balancing act between capital formation and investor protection, and I’ve illustrated the point by showing a picture of a scale with capital formation on one side and investor protection on the other. But, I’ve come to believe in a better illustration—one in which investor protection is portrayed as the foundation upon which capital formation is built. In reality, regulation allows capital formation to flourish by giving investors the confidence they need to invest.
The key is that regulation must be smart. Dumb regulation manifests itself in a variety of ways: it puts pointless burdens on business, fails to reflect changing technology, is overly protective of turf, or, even worse, leaves investors as sheep to be sheared. Smart regulation, in contrast, provides a sufficient level of protection to bolster confidence without needlessly burdening the regulated entities.
As you can attest, state regulators are often characterized as bastions of dumb regulation. Unfortunately, you don’t have to look hard to find examples of practices that feed the reputation. However, in large part, states are the places where smart regulation can flourish. You are closer to Mom and Pop investors, closer to small businesses, and in tune with the needs of both. New ideas can be tested and, when necessary, can more easily be discarded.
Often, smart regulation requires coordination between states and a willingness to give up some of your own preferences in order to foster consistent rules from state to state. Toward that end, I applaud your adoption of the coordinated review program for offerings conducted under the new Regulation A.[4] This program is forward-thinking and a potential game-changer in state regulation.
However, smart regulation doesn’t always look the same in every state. For example, while I was General Counsel for the Office of the Kansas Securities Commissioner, I wrote a rule called the Invest Kansas Exemption.[5] It was the first of what could be characterized as an intrastate crowdfunding exemption. It was designed to allow small-dollar offerings to an entire community of interest, without a prohibition on general solicitation. I was comfortable adopting the exemption in a rural state, where the investors and promoters likely know each other, but I would have recommended more conditions on the exemption in a more urban state where the investors and promoters would likely be strangers.
The theme of this conference is “Progress Through Innovation,” and I think state and provincial regulators have an important role to play in promoting economic progress. By innovating in the ways you regulate, whether through multijurisdictional coordination or unique intrastate exemptions, you can spur innovation and entrepreneurship in your states and provinces. And you also provide a layer of protection that investors need, which gives them the confidence to invest in the offerings you oversee.
Because your role is so important, the states need to stay in the game and retain relevancy. Investors are counting on you. And, if they stop to think about it, small businesses are counting on you, too.
Now, let’s take a moment to consider the importance of smart regulation within a much broader context. Let’s look at the really big picture. Here in the U.S., we are motivated by an idea called the “American Dream.” This is a fundamental belief that a person, through hard work, can improve their socio-economic status. NASAA members and their constituents from Canada and Mexico also dream of economic upward mobility, though they no doubt call it something different.
Any parent with grown children has probably preached several times—over groans of protest and eye-rolling—how those children can achieve economic success. It starts with a good education, where we obtain not only knowledge, but we learn to play well with others, get things done on time, and develop other marketable skills. The next step is getting a job, working hard, doing the types of things no one else wants to do, and hopefully catching a break or two along our career path. Then, once the income starts coming in, we must learn to live within our means and become savers. Finally, if we want to put those savings to work for us, we become investors and begin to accumulate wealth.
Imagine, if you will, what happens if everyone in America, or everyone in Canada, or everyone in Mexico, begins to follow those steps. Imagine the powerful economic engine that is created when everyone in a society is striving to work hard, save money, and invest for the future.
But, consider with me what happens when something goes awry. Suppose a person has done all the right things. She has worked hard in school and received a good education, then worked hard in a job and managed to work her way up, overcoming the various obstacles that life threw her way. She gave up a lot of instant gratification in order to save for the future, and she built up a nice nest egg for retirement. Then, on the eve of that retirement, somebody comes along and steals the nest egg from her, or engages in unethical practices that cause her to suffer significant losses.
This is why we have securities laws. J.N. Dolley, the author of the first blue sky law, was a banker who had seen customers withdraw money from banks to chase higher yields by investing in copper mines, Central American plantations, irrigation projects, or other wildcat stocks. Dolley believed that “at least ninety-five percent of all the money put in those stocks was irretrievably lost,” so he proposed a set of statutes to require governmental review of securities offerings.[6]
We still need those laws today. Those in this room, more than most others, are familiar with the devastation brought about by securities fraud. How many in this room have seen retirees go back to work after being fleeced? How many have seen marriages end? How many have seen victims turn to suicide? Don’t ever forget how important your jobs are.
Now, in case you aren’t depressed enough, let’s look at this from a collective viewpoint. If all Americans are getting a good education, working hard, saving money, and investing, we have a powerful economic engine, but what happens if something occurs that makes us lose hope in the American Dream — for example, the stock market crash of 1929?
This is why the federal government began to regulate the sale of securities. After the stock market crashed, a Congressional investigation revealed widespread manipulation of the markets and rampant insider trading.[7] As a result of the crash, people began to hoard their money and the economic engine lost steam in a rather dramatic fashion. Thus, when President Franklin D. Roosevelt recommended the passage of what became known as the Securities Act of 1933, he expressed his desire to “give impetus to honest dealing in securities and thereby bring back public confidence.”[8] The point of the ’33 Act, then, was not to punish businesses for getting us into the Great Depression, but rather to get us out of the Depression by restoring investor confidence. This new regulatory structure gave us a foundation upon which capital formation could occur.
Fast forward to the 21st Century and the financial crisis of 2008. As a result of the crisis, median household net worth fell almost 39 percent.[9] At least three significant factors contributed to the loss of net worth. Home values fell almost 29 percent from their peak in April 2006 to the end of the recession in June 2009, wiping out about $9 trillion in home equity.[10] Stock values plunged, too. The S&P 500 lost 55 percent of its value between its high in October 2007 and its trough in March 2009.[11] Finally, unemployment peaked at about 10 percent in October 2009 and stayed above 8 percent for 3 years.[12]
Although the economy has improved significantly in recent years, these hits to ordinary Americans continue to have a significant impact on our faith in the American Dream. According to a New York Times poll last December, less than two-thirds of Americans (64 percent) now believe they could be born poor, work hard, and get rich in America.[13] This percentage has declined steadily since 2011, which was after the worst of the crisis, when 81 percent still believed it.[14] That’s a 17 percent decline in just a few years.
In addition, almost half of Americans now expect future generations to be worse off. Another one-fourth think future generations will wind up being “about the same,” which means that only about one-fourth of Americans expect future generations to have better lives.[15] And, according to a November NBC/Wall Street Journal poll, 56 percent of Americans think the country’s economic and political systems are stacked against people like them.[16]
This loss of hopefulness, I believe, presents one of the greatest challenges of our time. And I don’t come here today to suggest that it’s up to you to solve all of our problems. Just as you were not in a position to create this mess, you aren’t realistically in a position to solve everything.
But, don’t minimize the importance of the things you can do. Through smart and innovative regulation, you can spur economic development on a level playing field. And your visibility as local cops on the beat will be a reassuring presence to those who have become cynical of the system.
I hope I’ve set the table for the rest of your conference by highlighting for you the importance of the topics you will be discussing. In many ways, you are guardians of hopes and dreams of the people in your state. For their sake, I encourage you to maintain your vigilance, maintain your zeal, and keep up the fight.
Thank you.
[1] The Securities and Exchange Commission, as a matter of policy, disclaims responsibility for any private publication or statement by any of its employees. The views expressed herein are those of the author and do not necessarily reflect the views of the Commission or of the author’s colleagues on the Commission staff.
[2] Section 19(d) of the Securities Act of 1933, 15 U.S.C. § 77s(d), requires the Commission to conduct an annual conference and other meetings as may be necessary with any association of state-level securities regulators, self-regulatory organizations, agencies, and private organizations involved in capital formation, in order to achieve maximum effectiveness and uniformity in federal and state regulatory standards with minimum interference with the business of capital formation.
[3] “The purpose of [subsection 19(d)] is to engender cooperation between the Commission, any such association of State securities officials, and other duly constituted securities associations in the following areas: (A) the sharing of information regarding the registration or exemption of securities issues applied for in the various States; (B) the development and maintenance of uniform securities forms and procedures; and (C) the development of a uniform exemption from registration for small issuers which can be agreed upon among several States or between the States and the Federal Government.” Securities Act Section 19(d)(2), 15 U.S.C. § 77s(d).
[4] NASAA Coordinated Review Program for Regulation A Offerings, available at http://www.nasaa.org/industry-resources/corporation-finance/coordinated-review/regulation-a-offerings/.
[5] Kan. Admin. Reg. 81-5-21, as modified by Special Order dated June 21, 2013.
[6] Will Payne, How Kansas Drove Out a Set of Thieves, SATURDAY EVENING POST, Dec. 2, 1911.
[7] Larry Bumgardner, A Brief History of the 1930s Securities Laws in the United States—And the Potential Lessons for Today, The Journal of Global Business Management, available at http://www.jgbm.org/page/5%20Larry%20Bumgardner.pdf.
[8] Message from the President—Regulation of Security Issues, Presented to Senate Mar. 28, 1933, 77 Cong.Rec. 937 (1933).
[9] U.S. Government Accountability Office, Financial Regulatory Reform: Financial Crisis Losses and Potential Impacts of the Dodd-Frank Act (Jan. 2013) (hereinafter GAO Report), at 20 (citing Federal Reserve Survey of Consumer Finances).
[10] Id. at 20-21.
[11] Steve Santiago, Should Investors Over Age 50 Own Stocks?, BANKRATE, available at http://www.bankrate.com/finance/financial-literacy/do-stocks-make-sense-for-the-50-plus-crowd-1.aspx
[12] GAO Report, at 17.
[13] Andrew Ross Sorkin and Megan Thee-Brenan, Many Feel the American Dream Is Out of Reach, Poll Shows, N.Y. Times, Dec. 10, 2014, available at http://dealbook.nytimes.com/2014/12/10/many-feel-the-american-dream-is-out-of-reach-poll-shows/?_r=0
[14] Id.
[15] Chris Cillizza, Work Hard, Get Rich? Maybe Not Anymore, THE WASHINGTON POST, Dec. 11, 2014.
[16] Americans of All Stripes Agree: The System Is Stacked Against Them, WALL STREET JOURNAL, Nov. 20, 2014.
The Importance of Smart Regulation
Rick A. Fleming, Investor Advocate
U.S. Securities and Exchange Commission[1]
NASAA Public Policy Conference
Mayflower Renaissance Hotel
Keynote Luncheon
Washington, D.C.
April 14, 2015
Thank you, [Bill Beatty], for the nice introduction, and for the opportunity to come back and visit many old friends.
Thanks, also, to all of you who participated in the 19(d) meetings this morning.[2] This is an important opportunity for state and federal collaboration, and I would remind my new friends at the SEC that Section 19(d) of the Securities Act provides for much more than a once-a-year gathering. It envisions an atmosphere in which the states are considered partners in certain types of rulemakings, not mere commenters.[3]
Today, I want to talk about the business of regulating, and why it is so important that you do your jobs well. Of course, the views I express are my own and do not necessarily reflect those of the Commission, the Commissioners, or my colleagues on the Commission staff.
As you know, many people start with an assumption that all regulation is bad for business. Some lobbyists and politicians in D.C. certainly believe this, and while they may pay lip service to investor protection, the result of their consistent policy positions would leave investors naked and hungry. I am also aware that, sadly, some of your bosses back home harbor a fundamental belief that your work is an impediment to economic growth.
Unfortunately, we sometimes contribute to this misconception. Over the course of my career, I have often given speeches in which I have portrayed securities regulation as a balancing act between capital formation and investor protection, and I’ve illustrated the point by showing a picture of a scale with capital formation on one side and investor protection on the other. But, I’ve come to believe in a better illustration—one in which investor protection is portrayed as the foundation upon which capital formation is built. In reality, regulation allows capital formation to flourish by giving investors the confidence they need to invest.
The key is that regulation must be smart. Dumb regulation manifests itself in a variety of ways: it puts pointless burdens on business, fails to reflect changing technology, is overly protective of turf, or, even worse, leaves investors as sheep to be sheared. Smart regulation, in contrast, provides a sufficient level of protection to bolster confidence without needlessly burdening the regulated entities.
As you can attest, state regulators are often characterized as bastions of dumb regulation. Unfortunately, you don’t have to look hard to find examples of practices that feed the reputation. However, in large part, states are the places where smart regulation can flourish. You are closer to Mom and Pop investors, closer to small businesses, and in tune with the needs of both. New ideas can be tested and, when necessary, can more easily be discarded.
Often, smart regulation requires coordination between states and a willingness to give up some of your own preferences in order to foster consistent rules from state to state. Toward that end, I applaud your adoption of the coordinated review program for offerings conducted under the new Regulation A.[4] This program is forward-thinking and a potential game-changer in state regulation.
However, smart regulation doesn’t always look the same in every state. For example, while I was General Counsel for the Office of the Kansas Securities Commissioner, I wrote a rule called the Invest Kansas Exemption.[5] It was the first of what could be characterized as an intrastate crowdfunding exemption. It was designed to allow small-dollar offerings to an entire community of interest, without a prohibition on general solicitation. I was comfortable adopting the exemption in a rural state, where the investors and promoters likely know each other, but I would have recommended more conditions on the exemption in a more urban state where the investors and promoters would likely be strangers.
The theme of this conference is “Progress Through Innovation,” and I think state and provincial regulators have an important role to play in promoting economic progress. By innovating in the ways you regulate, whether through multijurisdictional coordination or unique intrastate exemptions, you can spur innovation and entrepreneurship in your states and provinces. And you also provide a layer of protection that investors need, which gives them the confidence to invest in the offerings you oversee.
Because your role is so important, the states need to stay in the game and retain relevancy. Investors are counting on you. And, if they stop to think about it, small businesses are counting on you, too.
Now, let’s take a moment to consider the importance of smart regulation within a much broader context. Let’s look at the really big picture. Here in the U.S., we are motivated by an idea called the “American Dream.” This is a fundamental belief that a person, through hard work, can improve their socio-economic status. NASAA members and their constituents from Canada and Mexico also dream of economic upward mobility, though they no doubt call it something different.
Any parent with grown children has probably preached several times—over groans of protest and eye-rolling—how those children can achieve economic success. It starts with a good education, where we obtain not only knowledge, but we learn to play well with others, get things done on time, and develop other marketable skills. The next step is getting a job, working hard, doing the types of things no one else wants to do, and hopefully catching a break or two along our career path. Then, once the income starts coming in, we must learn to live within our means and become savers. Finally, if we want to put those savings to work for us, we become investors and begin to accumulate wealth.
Imagine, if you will, what happens if everyone in America, or everyone in Canada, or everyone in Mexico, begins to follow those steps. Imagine the powerful economic engine that is created when everyone in a society is striving to work hard, save money, and invest for the future.
But, consider with me what happens when something goes awry. Suppose a person has done all the right things. She has worked hard in school and received a good education, then worked hard in a job and managed to work her way up, overcoming the various obstacles that life threw her way. She gave up a lot of instant gratification in order to save for the future, and she built up a nice nest egg for retirement. Then, on the eve of that retirement, somebody comes along and steals the nest egg from her, or engages in unethical practices that cause her to suffer significant losses.
This is why we have securities laws. J.N. Dolley, the author of the first blue sky law, was a banker who had seen customers withdraw money from banks to chase higher yields by investing in copper mines, Central American plantations, irrigation projects, or other wildcat stocks. Dolley believed that “at least ninety-five percent of all the money put in those stocks was irretrievably lost,” so he proposed a set of statutes to require governmental review of securities offerings.[6]
We still need those laws today. Those in this room, more than most others, are familiar with the devastation brought about by securities fraud. How many in this room have seen retirees go back to work after being fleeced? How many have seen marriages end? How many have seen victims turn to suicide? Don’t ever forget how important your jobs are.
Now, in case you aren’t depressed enough, let’s look at this from a collective viewpoint. If all Americans are getting a good education, working hard, saving money, and investing, we have a powerful economic engine, but what happens if something occurs that makes us lose hope in the American Dream — for example, the stock market crash of 1929?
This is why the federal government began to regulate the sale of securities. After the stock market crashed, a Congressional investigation revealed widespread manipulation of the markets and rampant insider trading.[7] As a result of the crash, people began to hoard their money and the economic engine lost steam in a rather dramatic fashion. Thus, when President Franklin D. Roosevelt recommended the passage of what became known as the Securities Act of 1933, he expressed his desire to “give impetus to honest dealing in securities and thereby bring back public confidence.”[8] The point of the ’33 Act, then, was not to punish businesses for getting us into the Great Depression, but rather to get us out of the Depression by restoring investor confidence. This new regulatory structure gave us a foundation upon which capital formation could occur.
Fast forward to the 21st Century and the financial crisis of 2008. As a result of the crisis, median household net worth fell almost 39 percent.[9] At least three significant factors contributed to the loss of net worth. Home values fell almost 29 percent from their peak in April 2006 to the end of the recession in June 2009, wiping out about $9 trillion in home equity.[10] Stock values plunged, too. The S&P 500 lost 55 percent of its value between its high in October 2007 and its trough in March 2009.[11] Finally, unemployment peaked at about 10 percent in October 2009 and stayed above 8 percent for 3 years.[12]
Although the economy has improved significantly in recent years, these hits to ordinary Americans continue to have a significant impact on our faith in the American Dream. According to a New York Times poll last December, less than two-thirds of Americans (64 percent) now believe they could be born poor, work hard, and get rich in America.[13] This percentage has declined steadily since 2011, which was after the worst of the crisis, when 81 percent still believed it.[14] That’s a 17 percent decline in just a few years.
In addition, almost half of Americans now expect future generations to be worse off. Another one-fourth think future generations will wind up being “about the same,” which means that only about one-fourth of Americans expect future generations to have better lives.[15] And, according to a November NBC/Wall Street Journal poll, 56 percent of Americans think the country’s economic and political systems are stacked against people like them.[16]
This loss of hopefulness, I believe, presents one of the greatest challenges of our time. And I don’t come here today to suggest that it’s up to you to solve all of our problems. Just as you were not in a position to create this mess, you aren’t realistically in a position to solve everything.
But, don’t minimize the importance of the things you can do. Through smart and innovative regulation, you can spur economic development on a level playing field. And your visibility as local cops on the beat will be a reassuring presence to those who have become cynical of the system.
I hope I’ve set the table for the rest of your conference by highlighting for you the importance of the topics you will be discussing. In many ways, you are guardians of hopes and dreams of the people in your state. For their sake, I encourage you to maintain your vigilance, maintain your zeal, and keep up the fight.
Thank you.
[1] The Securities and Exchange Commission, as a matter of policy, disclaims responsibility for any private publication or statement by any of its employees. The views expressed herein are those of the author and do not necessarily reflect the views of the Commission or of the author’s colleagues on the Commission staff.
[2] Section 19(d) of the Securities Act of 1933, 15 U.S.C. § 77s(d), requires the Commission to conduct an annual conference and other meetings as may be necessary with any association of state-level securities regulators, self-regulatory organizations, agencies, and private organizations involved in capital formation, in order to achieve maximum effectiveness and uniformity in federal and state regulatory standards with minimum interference with the business of capital formation.
[3] “The purpose of [subsection 19(d)] is to engender cooperation between the Commission, any such association of State securities officials, and other duly constituted securities associations in the following areas: (A) the sharing of information regarding the registration or exemption of securities issues applied for in the various States; (B) the development and maintenance of uniform securities forms and procedures; and (C) the development of a uniform exemption from registration for small issuers which can be agreed upon among several States or between the States and the Federal Government.” Securities Act Section 19(d)(2), 15 U.S.C. § 77s(d).
[4] NASAA Coordinated Review Program for Regulation A Offerings, available at http://www.nasaa.org/industry-resources/corporation-finance/coordinated-review/regulation-a-offerings/.
[5] Kan. Admin. Reg. 81-5-21, as modified by Special Order dated June 21, 2013.
[6] Will Payne, How Kansas Drove Out a Set of Thieves, SATURDAY EVENING POST, Dec. 2, 1911.
[7] Larry Bumgardner, A Brief History of the 1930s Securities Laws in the United States—And the Potential Lessons for Today, The Journal of Global Business Management, available at http://www.jgbm.org/page/5%20Larry%20Bumgardner.pdf.
[8] Message from the President—Regulation of Security Issues, Presented to Senate Mar. 28, 1933, 77 Cong.Rec. 937 (1933).
[9] U.S. Government Accountability Office, Financial Regulatory Reform: Financial Crisis Losses and Potential Impacts of the Dodd-Frank Act (Jan. 2013) (hereinafter GAO Report), at 20 (citing Federal Reserve Survey of Consumer Finances).
[10] Id. at 20-21.
[11] Steve Santiago, Should Investors Over Age 50 Own Stocks?, BANKRATE, available at http://www.bankrate.com/finance/financial-literacy/do-stocks-make-sense-for-the-50-plus-crowd-1.aspx
[12] GAO Report, at 17.
[13] Andrew Ross Sorkin and Megan Thee-Brenan, Many Feel the American Dream Is Out of Reach, Poll Shows, N.Y. Times, Dec. 10, 2014, available at http://dealbook.nytimes.com/2014/12/10/many-feel-the-american-dream-is-out-of-reach-poll-shows/?_r=0
[14] Id.
[15] Chris Cillizza, Work Hard, Get Rich? Maybe Not Anymore, THE WASHINGTON POST, Dec. 11, 2014.
[16] Americans of All Stripes Agree: The System Is Stacked Against Them, WALL STREET JOURNAL, Nov. 20, 2014.
Wednesday, April 15, 2015
READOUT: VP BIDEN'S CALL WITH NIGERIAN PRESIDENT ELECT BUHARI
FROM: THE WHITE HOUSE
April 15, 2015
Readout of the Vice President’s Call with Nigerian President-Elect Buhari
Vice President Biden spoke with Nigerian President-elect Muhammadu Buhari to congratulate him on his victory in the recent Nigerian elections and affirm that the United States stands ready to expand collaboration with Nigeria on issues of common concern, including economic and security matters. The Vice President commended President-elect Buhari for his leadership in helping to ensure the elections were conducted peacefully and urged him to continue to foster a smooth, inclusive, and peaceful transition with President Jonathan. The Vice President expressed the United States’ support for Nigeria’s efforts to counter Boko Haram, recover hostages held by the group, and protect civilian populations. The Vice President also expressed the willingness of the United States to partner more closely with Nigeria to strengthen its economy.
April 15, 2015
Readout of the Vice President’s Call with Nigerian President-Elect Buhari
Vice President Biden spoke with Nigerian President-elect Muhammadu Buhari to congratulate him on his victory in the recent Nigerian elections and affirm that the United States stands ready to expand collaboration with Nigeria on issues of common concern, including economic and security matters. The Vice President commended President-elect Buhari for his leadership in helping to ensure the elections were conducted peacefully and urged him to continue to foster a smooth, inclusive, and peaceful transition with President Jonathan. The Vice President expressed the United States’ support for Nigeria’s efforts to counter Boko Haram, recover hostages held by the group, and protect civilian populations. The Vice President also expressed the willingness of the United States to partner more closely with Nigeria to strengthen its economy.
AG HOLDER'S STATEMENT ON 75TH ANNIVERSARY OF NAACP LEGAL DEFENSE FUND
FROM: U.S. JUSTICE DEPARTMENT
Tuesday, April 14, 2015
Attorney General Holder Statement on the 75th Anniversary of the NAACP Legal Defense Fund
Attorney General Eric Holder released the following statement on the 75th anniversary of the NAACP Legal Defense Fund:
“On behalf of the United States Department of Justice, I congratulate the NAACP Legal Defense and Educational Fund on 75 years of passionate legal advocacy and extensive educational outreach in its tireless pursuit of equality and justice throughout the nation. Since 1940, the NAACP LDF has stood at the forefront of America’s struggle to ensure that equality under the law is protected by the law. From the historic victory in Brown v. Board of Education, achieved under the leadership of legendary founder Thurgood Marshall, to the wide-ranging efforts of the visionaries who continue to build on Brown’s promise today, the NAACP LDF has made once-unimaginable progress in expanding democracy, drawing attention to persistent disparities, and securing the more just society that all Americans deserve. As this vital organization celebrates 75 years of civil rights achievements, I look forward to all that it will accomplish in the days and years to come.”
Tuesday, April 14, 2015
Attorney General Holder Statement on the 75th Anniversary of the NAACP Legal Defense Fund
Attorney General Eric Holder released the following statement on the 75th anniversary of the NAACP Legal Defense Fund:
“On behalf of the United States Department of Justice, I congratulate the NAACP Legal Defense and Educational Fund on 75 years of passionate legal advocacy and extensive educational outreach in its tireless pursuit of equality and justice throughout the nation. Since 1940, the NAACP LDF has stood at the forefront of America’s struggle to ensure that equality under the law is protected by the law. From the historic victory in Brown v. Board of Education, achieved under the leadership of legendary founder Thurgood Marshall, to the wide-ranging efforts of the visionaries who continue to build on Brown’s promise today, the NAACP LDF has made once-unimaginable progress in expanding democracy, drawing attention to persistent disparities, and securing the more just society that all Americans deserve. As this vital organization celebrates 75 years of civil rights achievements, I look forward to all that it will accomplish in the days and years to come.”
U.S. DOD REPORTS ON AIRSTRIKES AGAINST ISIL IN SYRIA, IRAQ
FROM: U.S. DEFENSE DEPARTMENT
Coalition Continues Airstrikes Against ISIL in Syria, Iraq
From a Combined Joint Task Force Operation Inherent Resolve News Release
SOUTHWEST ASIA, April 15, 2015 – U.S. and coalition military forces have continued to attack Islamic State of Iraq and the Levant terrorists in Syria and Iraq, Combined Joint Task Force Operation Inherent Resolve officials reported today.
Officials reported details of the latest strikes, which took place between 8 a.m. yesterday and 8 a.m. today, local time, noting that assessments of results are based on initial reports.
Airstrikes in Syria
Attack and fighter aircraft conducted six airstrikes in Syria:
-- Near Hasakah, two airstrikes struck two ISIL tactical units and destroyed six ISIL fighting positions, an ISIL vehicle bomb, an ISIL tunnel and an ISIL bunker.
-- Near Kobani, four airstrikes struck two ISIL tactical units and destroyed six ISIL fighting positions.
Airstrikes in Iraq
Fighter, attack and remotely piloted aircraft conducted 17 airstrikes in Iraq, approved by the Iraqi Ministry of Defense:
-- Near Beiji, nine airstrikes struck two large and six smaller tactical units and destroyed two ISIL fighting positions and an ISIL heavy machine gun.
-- Near Fallujah, two airstrikes struck two ISIL tactical units and destroyed an ISIL bunker.
-- Near Mosul, an airstrike struck an ISIL staging area.
-- Near Ramadi, three airstrikes struck two ISIL tactical units and destroyed an ISIL armored personnel carrier.
-- Near Sinjar, an airstrike struck an ISIL tactical unit and destroyed an ISIL building, an ISIL mortar system and an ISIL fighting position.
-- Near Tal Afar, an airstrike struck an ISIL tactical unit and destroyed an ISIL heavy machine gun and an ISIL fighting position.
Part of Operation Inherent Resolve
The strikes were conducted as part of Operation Inherent Resolve, the operation to eliminate the ISIL terrorist group and the threat they pose to Iraq, Syria, the region, and the wider international community. The destruction of ISIL targets in Syria and Iraq further limits the terrorist group's ability to project terror and conduct operations, officials said.
Coalition nations conducting airstrikes in Iraq include the United States, Australia, Belgium, Canada, Denmark, France, Jordan, the Netherlands and the United Kingdom. Coalition nations conducting airstrikes in Syria include the United States, Bahrain, Canada, Jordan, Saudi Arabia and the United Arab Emirates.
Coalition Continues Airstrikes Against ISIL in Syria, Iraq
From a Combined Joint Task Force Operation Inherent Resolve News Release
SOUTHWEST ASIA, April 15, 2015 – U.S. and coalition military forces have continued to attack Islamic State of Iraq and the Levant terrorists in Syria and Iraq, Combined Joint Task Force Operation Inherent Resolve officials reported today.
Officials reported details of the latest strikes, which took place between 8 a.m. yesterday and 8 a.m. today, local time, noting that assessments of results are based on initial reports.
Airstrikes in Syria
Attack and fighter aircraft conducted six airstrikes in Syria:
-- Near Hasakah, two airstrikes struck two ISIL tactical units and destroyed six ISIL fighting positions, an ISIL vehicle bomb, an ISIL tunnel and an ISIL bunker.
-- Near Kobani, four airstrikes struck two ISIL tactical units and destroyed six ISIL fighting positions.
Airstrikes in Iraq
Fighter, attack and remotely piloted aircraft conducted 17 airstrikes in Iraq, approved by the Iraqi Ministry of Defense:
-- Near Beiji, nine airstrikes struck two large and six smaller tactical units and destroyed two ISIL fighting positions and an ISIL heavy machine gun.
-- Near Fallujah, two airstrikes struck two ISIL tactical units and destroyed an ISIL bunker.
-- Near Mosul, an airstrike struck an ISIL staging area.
-- Near Ramadi, three airstrikes struck two ISIL tactical units and destroyed an ISIL armored personnel carrier.
-- Near Sinjar, an airstrike struck an ISIL tactical unit and destroyed an ISIL building, an ISIL mortar system and an ISIL fighting position.
-- Near Tal Afar, an airstrike struck an ISIL tactical unit and destroyed an ISIL heavy machine gun and an ISIL fighting position.
Part of Operation Inherent Resolve
The strikes were conducted as part of Operation Inherent Resolve, the operation to eliminate the ISIL terrorist group and the threat they pose to Iraq, Syria, the region, and the wider international community. The destruction of ISIL targets in Syria and Iraq further limits the terrorist group's ability to project terror and conduct operations, officials said.
Coalition nations conducting airstrikes in Iraq include the United States, Australia, Belgium, Canada, Denmark, France, Jordan, the Netherlands and the United Kingdom. Coalition nations conducting airstrikes in Syria include the United States, Bahrain, Canada, Jordan, Saudi Arabia and the United Arab Emirates.
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