LEGAL : View Posts

WASHINGTON – As part of a combined $8.9 billion settlement with federal and state government agencies, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today announced a $963 million agreement with BNP Paribas SA (BNPP) to settle its potential liability for apparent violations of U.S. sanctions regulations. Today’s settlement resolves OFAC’s investigation into BNPP’s systemic practice of concealing, removing, omitting, or obscuring references to information about U.S.-sanctioned parties in 3,897 financial and trade transactions routed to or through banks in the United States between 2005 and 2012 in apparent violation of the Sudanese Sanctions Regulations, 31 C.F.R. part 538; the Iranian Transactions and Sanctions Regulations, 31 C.F.R. part 560; the Cuban Assets Control Regulations, 31 C.F.R. part 515; and the Burmese Sanctions Regulations, 31 C.F.R. part 537.

OFAC worked closely with its counterparts at the Board of Governors of the Federal Reserve System (Board of Governors), the U.S. Department of Justice (DOJ), the New York County District Attorney’s Office (DANY), and the New York State Department of Financial Services (NYDFS). Together, the agencies cooperated with France’s Autorité de Contrôle Prudentiel et de Résolution, and collaborated closely throughout the investigation to ensure a global settlement. Today’s OFAC settlement is being entered into simultaneously with the bank’s resolution of the matter with the Board of Governors, DOJ, DANY, and the NYDFS.

“Today’s settlement is OFAC’s largest-ever and reaffirms OFAC’s determination to aggressively enforce U.S. sanctions rules and regulations,” said OFAC Director Adam J. Szubin. “The settlement is the result of an interagency effort to investigate institutions that abuse the U.S. financial system and undermine U.S. sanctions programs. OFAC will continue to coordinate these efforts with other federal and state agencies in order to protect the U.S. financial infrastructure from the risks inherent in this type of illicit activity.”

The specific payment practices the bank utilized in order to process sanctions-related payments to or through the United States included omitting references to sanctioned parties; replacing the names of sanctioned parties with BNPP’s name or a code word; and structuring payments in a manner that did not identify the involvement of sanctioned parties in payments sent to U.S. financial institutions. While these payment practices occurred throughout multiple branches and subsidiaries of the bank, BNPP’s subsidiary in Geneva and branch in Paris facilitated or conducted the overwhelming majority of the apparent violations.

Under the settlement agreement, BNPP is required to put in place and maintain policies and procedures to minimize the risk of the recurrence of such conduct in the future. BNPP is also required to provide OFAC with copies of submissions to the Board of Governors relating to the OFAC compliance review that it will be conducting as part of its settlement with the Board of Governors.

BNPP’s $963 million settlement with OFAC will be deemed satisfied by the bank’s payment of that amount to DOJ for the same pattern of conduct.

This is courtesy of www.treasury.gov

In the Rose Garden this afternoon, President Obama reiterated his commitment to immigration reform and reproached House Republicans for their unwillingness to confront this important issue.

Speaking a year ago to the month when the Senate passed an immigration reform bill, the President outlined what Republican obstruction has meant over the past year:

We have fewer resources to strengthen our borders;
Businesses can still game the system by hiring undocumented workers — which punishes businesses that are playing by the rules and hurting the wages of hard-working Americans;
The best and brightest that come to study in the United States are still forced to leave, heading overseas and subsequently competing against our workers; and
Eleven million immigrants are still living in the shadows, instead of having the opportunity to earn their citizenship.
What’s more, “it’s meant the heartbreak of separated families,” the President stressed.

Meanwhile, the majority of Americans — ranging from law enforcement to labor to faith communities — continue to support immigration reform.

The bill passed by the Senate last year would strengthen our borders, grow our economy, and shrink our deficit. There are enough Republicans and Democrats that support immigration reform today to pass an immigration reform bill. “And Washington would solve a problem in a bipartisan way,” the President noted.

In President Obama’s remarks, he said that “Our country and our economy would be stronger today, if House Republicans had allowed a simple yes or no vote” on the Senate bill.

“Instead, they’ve proven again and again that they’re unwilling to stand up to the Tea Party in order to do what’s best for the country. And the worst part about it is, a bunch of them know better.”

Republicans have indicated that they intend to block a vote at least for the remainder of this year.

“Their argument seems to be that because the system’s broken, we shouldn’t make an effort to fix it. It makes no sense. It’s not on the level. It’s just politics. Plain and simple.”

–President Obama, 6/30/2014

Other Republicans are mad at the President because he has used his executive actions too broadly. The President quickly countered that argument:

This also makes no sense. I don’t prefer taking administrative action. I’d rather see permanent fixes to the issue we face. Certainly that’s true on immigration. I’ve made that clear multiple times. I would love nothing more than bipartisan legislation to pass the House, the Senate, land on my desk so I can sign it. That’s true about immigration, that’s true about the minimum wage, it’s true about equal pay. There are a whole bunch of things where I would greatly prefer Congress actually do something.
President Obama reiterated that “the failure of House Republicans to pass a darn bill is bad for our security, it’s bad for our economy, and it’s bad for our future.”

So where Congress fails to act, the President is going to continue to use his pen and his phone to fix the immigration system and keep our borders secure.

President Obama directed the Secretary of Homeland Security and the Attorney General to move additional resources to the border to ensure that dangerous criminals are kept our of this country and the public is protected. The President also directed Secretary Johnson and Attorney General Holder to start to identify additional administrative actions that can be taken to try to fix as much of the immigration system as possible on his own. “If Congress will not do their job, at least we can do ours,” the President said.

The President closed his remarks, talking about the upcoming holiday on Friday. He reminded us that one of the reasons we celebrate July 4th — and one of the things that makes this country great — is that we all came from somewhere else: That we are a nation of immigrants.

Our people come from every corner of the globe. That’s what makes us special. That’s what makes us unique. And throughout our history, we’ve come here in wave after wave from everywhere understanding that there was something about this place where the whole was greater than the sum of its parts; that all the different cultures and ideas and energy would come together and create something new.
We won this country’s freedom together. We built this country together. We defended this country together. It makes us special. It makes us strong. It makes us Americans. That’s worth celebrating. And that’s what I want not just House Republicans but all of us as Americans to remember.

This news is courtesy of www.whitehouse.gov

The Department of Justice announced today that it will require Martin Marietta Materials Inc. to divest one Oklahoma quarry and two Texas rail yards in order to proceed with its proposed $2.7 billion acquisition of Texas Industries Inc. The department said that, without the divestiture, the proposed acquisition likely would result in higher prices for purchasers of aggregate – crushed stone produced at quarries or mines – in parts of the Dallas metropolitan area.

The department’s Antitrust Division and the state of Texas filed a civil antitrust lawsuit today in the U.S. District Court for the District of Columbia to block the proposed transaction. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the department’s competitive concerns alleged in the lawsuit.

“Today’s proposed settlement will help ensure that aggregate purchasers in parts of the Dallas metropolitan area will continue to receive the benefits of vigorous competition,” said Bill Baer, Assistant Attorney General in charge of the department’s Antitrust Division. “Without the divestiture obtained by the Antitrust Division, customers would have likely faced higher prices as a result of this acquisition.”

Aggregate is used in a variety of applications, such as road construction, and for the production of ready mix concrete and asphalt.

The department said that the proposed merger would have likely resulted in increased prices for customers handling Texas Department of Transportation projects in parts of the Dallas metropolitan area. The Texas Department of Transportation – like many other state Departments of Transportation – sets specifications for the type of aggregate approved for use in those projects. In Dallas County and parts of the surrounding area, Martin Marietta and Texas Industries are two of the only three suppliers of Texas Department of Transportation-approved aggregate.

Under the terms of the proposed consent decree, Martin Marietta must divest its North Troy aggregate quarry in Mill Creek, Oklahoma, its rail yard in Dallas, and its rail yard in Frisco, Texas. All of these assets predominantly serve parts of the Dallas metropolitan area. Under the proposed settlement, the department’s Antitrust Division must approve the buyer of the divested assets.

Martin Marietta Materials Inc. is incorporated in North Carolina with its headquarters in Raleigh, North Carolina. Martin Marietta produces, distributes and/or markets aggregate for the construction industry in 29 states and it produces aggregate in Nova Scotia, Canada, and the Bahamas for distribution and sale at numerous terminals and yards along the East Coast of the United States. In 2013, Martin Marietta had net sales of $2.1 billion.

Texas Industries Inc. is incorporated in Delaware with its headquarters in Dallas. Texas Industries produces, distributes and/or markets aggregate in five states – Texas, Oklahoma, Louisiana, Arkansas and California. Texas Industries also produces asphalt concrete, ready mix concrete and cement. In 2013, Texas Industries had net sales of $800 million.

As required by the Tunney Act, the proposed consent decree, along with the department’s competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed decree during a 60-day comment period to Maribeth Petrizzi, Chief, Litigation II Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 8700, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.

This news is courtesy of www.justice.gov

WASHINGTON, D.C. — The Consumer Financial Protection Bureau (CFPB) is ordering GE Capital Retail Bank (GE Capital), now known as Synchrony Bank, to provide an estimated $225 million in relief to consumers harmed by illegal and discriminatory credit card practices. GE Capital must refund $56 million to approximately 638,000 consumers who were subjected to deceptive marketing practices. As part of the joint enforcement action by the CFPB and Department of Justice, GE Capital must also provide an additional $169 million to about 108,000 borrowers excluded from debt relief offers because of their national origin. This order represents the federal government’s largest credit card discrimination settlement in history.

“Today’s action will provide $225 million in relief to GE Capital credit card customers who were harmed by deceptive marketing or discrimination,” said CFPB Director Richard Cordray. “We will continue to take action against marketing tactics that trick consumers into buying credit card products they do not want or cannot use. Consumers also deserve to be treated fairly no matter where they live or what language they speak.”

“The blatant discrimination that occurred here is unlawful and will not be tolerated. Borrowers have the right to credit card terms that do not differ based on their national origin, and the settlement today sends the message that the Justice Department can and will vigorously enforce the law against lenders who violate that right,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division of the Department of Justice.

GE Capital changed its name to Synchrony Bank on June 2, 2014. GE Capital is a federal savings bank headquartered in Draper, Utah with assets totaling more than $39 billion. GE provides store-branded credit cards that are sold to consumers by merchants and retailers across the country. Today’s enforcement action related to credit card add-on products stems from a CFPB examination which was conducted between December 2012 and February 2013. The action related to the discriminatory credit card practices resulted from GE Capital’s self-reporting of the issue to the CFPB, which led to a joint investigation between the CFPB and the Department of Justice.

Deceptive Marketing
Bureau examiners identified several deceptive marketing practices used by GE Capital to promote its credit card add-on products. GE Capital offered five different debt cancellation add-on products: “Card Security,” “Account Security,” “Account Security Plus,” “Debt Security,” and “Debt Security Plus.” GE promoted these products as providing debt cancellation of a certain percent of the consumer’s balance in the event of certain hardships like involuntary unemployment or disability. The Bureau found that GE Capital’s telemarketers misrepresented these products to consumers in four main ways:

Marketed the product as free of charge: Telemarketers led consumers to believe they would not have to pay for these products as long as they paid off the balance on their billing statement. In fact, consumers could only avoid the fee in very specific circumstances, such as if the account was not in use or if the customer had paid off the balance prior to GE Capital issuing its monthly billing statement.

Failed to disclose consumers’ ineligibility: In calls with telemarketers, many consumers mentioned that they were retired or disabled, which would mean that they were not eligible for key benefits of the products. Even after hearing this, the telemarketers neglected to tell the consumers that they would not be eligible for key debt cancellation benefits, and the consumers bought the products without this important information.

Failed to disclose that consumers were making a purchase: In many cases, the telemarketers did not make it clear that consumers were purchasing a product. Rather, they made it seem like the consumers were receiving a benefit, updating their accounts, or that the telemarketers were handling other administrative tasks. In these conversations, it was not obvious to consumers that they were buying something and would be charged a fee.

Marketed products as a limited time offer: Many customer service representatives falsely told consumers that these debt cancellation products were a “limited time offer.” In reality, nothing about the availability of these products was limited. However, leading consumers to believe they had a short timeframe to sign up may have created a false sense of pressure and pushed them to enroll in the products.

Discriminatory Credit Practices
GE Capital had two different promotions that allowed credit card customers with delinquent accounts to settle their balances by paying off a specific portion of their debt.

Statement Credit Offer: Customers with balances greater than $700, a credit score below 670, and whose minimum payment due was more than $150 were offered a credit of between $25 to $100 if they paid off their minimum amount due. This promotion ran from March 2010 to March 2012.

Settlement Offer: Customers with balances greater than $200, a credit score within certain thresholds, four or more payments overdue, and no payments in the past 90 days received offers to waive their remaining account balance if they paid between 25 percent and 55 percent of what was owed. This promotion ran from January 2009 to March 2012.

GE Capital did not extend these offers to any customer who indicated that they preferred to communicate in Spanish or had a mailing address in Puerto Rico, even if the customer met the promotion’s qualifications. This meant that Hispanic populations were unfairly denied the opportunity to benefit from these promotions. Such discrimination is in direct violation of the Equal Credit Opportunity Act (ECOA). The ECOA prohibits creditors from discriminating in any aspect of a credit transaction on the basis of characteristics such as race and national origin. In this case, the customers did not receive either offer in any language, including English, and did not know they were being discriminated against.

Enforcement Action
Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, the CFPB has the authority to take action against institutions engaging in unfair, deceptive, or abusive practices. The ECOA authorizes the CFPB and the DOJ to take action against creditors engaging in illegal discrimination. The CFPB is issuing a consent order as an administrative action covering both the deceptive marketing practices and the illegal discrimination. The DOJ’s settlement on discrimination was filed in the U.S. District Court for District of Utah. The CFPB’s order requires GE Capital:

End deceptive marketing practices:GE Capital must cease its deceptive marketing practices. GE Capital ended all telephone-based enrollments for all of the add-on products involved in today’s action in October 2012. GE Capital is prohibited from marketing or offering these products by telephone until it submits a compliance plan to the Bureau.

End illegal discrimination: GE Capital must end all discriminatory credit practices. GE Capital has included qualified customers who prefer to communicate in Spanish and customers with a mailing address in Puerto Rico in the settlement offer since March 2012. GE Capital completely discontinued the statement credit offer in March 2012.
Provide $225 million to harmed consumers: GE Capital must refund $56 million to the approximately 638,000 consumers who were affected by its deceptive marketing of the credit card add-on products. GE Capital must also provide $169 million in relief to about 108,000 borrowers excluded from debt relief offers because of their national origin. The $169 million represents the value of the offer that the consumer did not receive plus interest and indirect damages.

Conveniently provide consumer relief: Consumers do not need to take action to obtain their relief. If the consumers still have credit cards with GE Capital, they have received or will receive a credit to their accounts or a check. If they no longer have credit cards with GE Capital, they will receive or have received a check in the mail or have charged-off balances reduced by the amount of the relief. If the relief is greater than the consumer’s existing balance, the consumer will receive a check for the excess.

Notify credit reporting agencies of new information: For those consumers who did not receive the debt relief offers, GE Capital will work with credit reporting agencies to ensure that any negative information associated with the consumer’s GE Capital accounts as a result of these violations will be deleted from their credit history.

Forgive debt of accounts that did not receive debt relief offers: For the customers that did not receive debt relief offers because they preferred to communicate in Spanish or had a mailing address in Puerto Rico, if GE Capital had written off or sold their debt, that debt will be forgiven.

Pay a $3.5 million penalty: For its deceptive credit card marketing, GE Capital will make a $3.5 million penalty payment to the CFPB’s Civil Penalty Fund. With respect to the illegal discrimination, the Bureau is not assessing penalties based on a number of factors, including that the company self-reported the violation, self-initiated remediation for the harm done to affected consumers, and fully cooperated with the Bureau’s investigation.

The Bureau has ongoing supervisory authority over GE Capital and will continue to conduct examinations of GE Capital to ensure its compliance with federal consumer financial law.

This news is courtesy of www.consumefinance.gov

Pamela Morris, former secretary of a chapter of the Ku Klux Klan (KKK) in Ozark, Alabama, pleaded guilty today to committing perjury during a grand jury’s investigation into a racially motivated cross-burning in the U.S. District Court for the Middle District of Alabama.

Morris, 46, admitted in plea documents that on Feb. 20, 2013, she lied to a federal grand jury looking into a cross-burning committed by Steven Joshua Dinkle, Morris’s son and the leader of the local KKK, and Thomas Smith, another KKK member. On May 8, 2009, Dinkle and Smith burned a six-foot tall cross at the entrance to an African-American neighborhood in Ozark to threaten and intimidate residents. In sworn testimony before the grand jury, Morris made several false statements, including denying that she had been the secretary of the chapter or involved with the KKK at all.

In pleading guilty, Morris admitted that she had been an officer of the KKK and that her testimony denying any connection to the organization was false. She further acknowledged that she knew Dinkle had committed the cross-burning. In addition, Morris admitted that she testified falsely to prevent the grand jury from learning about other KKK members who had information relevant to the investigation.

A sentencing date has not yet been scheduled. Morris faces a statutory maximum sentence of five years in prison and a $250,000 fine.

Dinkle pleaded guilty on Feb. 3, 2014, to hate crime and obstruction of justice charges related to the cross-burning. On May 15, 2014, he was sentenced to serve 24 months in prison. Smith, Dinkle’s co-conspirator, pleaded guilty to conspiracy to interfere with housing rights on Dec. 6, 2013. He is scheduled to be sentenced on Aug. 19, 2014.

“Defendant Morris lied under oath blatantly and repeatedly to hinder an investigation into a cross-burning that was committed to intimidate an entire community,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “The department will continue to hold accountable not only those who commit such acts of violence, but also those who lie and obstruct the investigation into these crimes of intimidation.”

“Ms. Morris lied to the grand jury in an attempt to protect herself and to protect a cross burner,” said U.S. Attorney George L. Beck Jr. for the Middle District of Alabama. “When someone testifies in court they swear to tell the truth. Unfortunately, Ms. Morris lied. For our system of justice to protect the rights of all, those who testify before the grand jury must provide accurate and honest information. If someone fails to tell the truth while under oath, we will prosecute them.”

This case is being investigated by the FBI with the assistance of the Dale County Sheriff’s Office and the Ozark Police Department. The case is being prosecuted by Assistant U.S. Attorney Jerusha T. Adams of the Middle District of Alabama and Trial Attorney Chiraag Bains of the Civil Rights Division.

This news is courtesy of www.justice.gov

Following are UN Secretary-General Ban Ki-moon’s remarks at the launch of the Counter-Terrorism Implementation Task Force web portal, in New York today:

I thank you, Mr. President [John Ashe], for your leadership and initiative to organize this important event on counter-terrorism. Mr. President, if you allow me, I’d like to say a few words about the kidnapping of Turkish diplomats in Mosul, Iraq. I was shocked to hear that these terrorists have kidnapped the Consul General of Turkey and many diplomatic officers who are working in Mosul. This is totally unacceptable. As Secretary-General of the United Nations, I am condemning in the strongest possible terms such a terrorist attack against diplomatic officers. No such terrorist attack against diplomatic officers and civilians can be justified under any circumstances, under any reason. I’m urging the Government of Iraq and broadly the regional countries and the whole international community to be united to bring all these perpetrators to justice and to do all possible to have these diplomatic officers released safe and sound as soon as possible.

As we are discussing [this] very important topic this morning at the United Nations, I cannot express any further my shock. Yesterday, I issued another very strong statement condemning these terrorist attacks against Mosul, Iraq. Only after one day this happened again. Therefore, I’m urging that the whole international community must be united. We have to show strong commitment and solidarity to all these terrorists. And again, I count on [you], Mr. President, [for] your leadership, and all the members of the United Nations, [for] your continued commitment and leadership. Let’s work together to eliminate these terrorist attacks.

Again, ladies and gentlemen, I thank distinguished high-level representatives from Burkina Faso, Indonesia, Spain, Turkey and the United Republic of Tanzania for their participation. This Interactive Dialogue comes at an opportune time as a precursor to the Fourth Review of the UN Global Counter-Terrorism Strategy, which commences tomorrow. It gives me pleasure to note that my report on the implementation of the Global Counter-Terrorism Strategy has been well received by Member States. Many important recommendations of my report have been included in the draft resolution to be adopted at the end of the Review. A strong consensus-based resolution will set the direction of the UN’s work in countering terrorism going forward.

We meet in the immediate aftermath of yet another brazen terrorist attack. I offer my condolences once again to the families of the victims of the terrible assault at Karachi’s Jinnah International Airport. We see again the vital importance of strengthening national and international counter-terrorism efforts. Today we focus on how best to support victims of terrorism. It is fitting that we have with us here today Jason Pronyk, who is sitting with me and Mohammad Younus, here sitting together with us. They are all UN staff members who were severely wounded in the 2003 attack on our Canal Hotel Headquarters in Baghdad.

While the Global Strategy is a comprehensive and strategic plan of action, it is clear that more effort needs to be directed at combating the conditions that give rise to terrorism. Nothing can justify terrorism. No grievance or no cause can justify terrorist acts. But terrorism thrives when conflicts continue to simmer, or where rights are systematically violated, or where discrimination is institutionalized, or where there are few prospects of a secure and stable livelihood.

Our shared challenge is to ensure that terrorists do not find fertile ground to promote hate and intolerance. That means increasing our focus on de-radicalization, the rehabilitation of former terrorists and skills development for young people. Recent initiatives and conferences have generated a wealth of best practices and recommendations, and I urge all States to use those ideas to the fullest.

Any balanced and comprehensive strategy for combating terrorism must recognize that victims of terrorism are entitled to our support. Far too often, victims are left to suffer in silence as the world around them moves on even as their own lives have been upended. This only exacerbates their trauma. We must do more to protect the rights of victims of terrorism and provide the services they need.

The United Nations Victims of Terrorism Support Portal, developed by the Counter-Terrorism Implementation Task Force Office, is a major step in that direction. The Portal is a resource for thousands of victims, their families and communities, Governments and civil society organizations. It aims to promote understanding of the diverse needs of victims, and to offer guidance for addressing those needs effectively and comprehensively.

The launch of the Portal is meant to energize global efforts to support victims of terrorism. I thank the Government of Spain for its generous contribution towards its development. I encourage other Governments to contribute and help us to realize the Portal’s full potential.

We must collectively do more to ensure that our voices of compassion and tolerance are louder and have more impact. This will be critical to defeating terrorism and to making the world a safer place.

This news is courtesy of www.un.org

The Justice Department today released its latest compliance assessment of mental health services at the Los Angeles County Jails based on a memorandum of agreement (MOA) designed to protect the constitutional rights of prisoners with serious mental illness at the jails. The department concluded that, despite progress in some areas of the MOA, the county of Los Angeles fails to provide sufficient suicide prevention practices to protect prisoners from self-harm. The department also found that other serious deficiencies in the mental health care delivery system remain and combine with inadequate supervision and deplorable environmental conditions to deprive prisoners of constitutionally-required mental health care.

The Los Angeles County Jails system is the largest jail system in the country, housing approximately 19,000 pre-sentenced and sentenced prisoners in seven facilities throughout the county. The Los Angeles Sheriff’s Department operates the jails system and supports the delivery of mental health services within the jails by the county’s Department of Mental Health. In 2002, the department entered into the MOA with the county to resolve a long-standing civil investigation into conditions of confinement at the jails under the Civil Rights of Institutionalized Persons Act (CRIPA). The MOA gives the department access to personnel, documents and prisoners to evaluate the county’s compliance with the MOA. The department is assisted by expert consultants in correctional mental health care and suicide prevention, and provides ongoing technical assistance as part of its monitoring activities. The county has cooperated fully and openly with the department.

The comprehensive assessment released today confirms that certain conditions and practices have not been remedied under the MOA and continue to violate the constitutional rights of prisoners with mental illness. There have been 15 completed suicides at the jails in less than 30 months and the department concluded that some of the deaths may have been preventable with proper suicide prevention practices. The department’s assessment also reveals widespread lapses with regard to basic supervision of prisoners at risk; deficient mental health care for prisoners with clearly demonstrated needs; deplorable environmental conditions, most acutely at Men’s Central Jail; and a suicide review process that often includes inaccurate information and fails to remedy evident and repeated problems in order to prevent similar incidents in the future.

At the same time, the department’s assessment reveals that the county has achieved substantial compliance with certain aspects of the MOA. For example, the county has implemented nearly all provisions related to mental health screening at intake, developed a robust electronic medical records system, increased the number of clinical and support staff and ensured that custodial staff receive initial and ongoing training in the identification and custodial care of prisoners with mental illness. The county has demonstrated a sustained level of acceptable performance and improvement in these areas, which will no longer be subject to evaluation under the MOA.

“The Los Angeles County Jails have an obligation to provide conditions of confinement that do not offend the Constitution and to take reasonable measures to protect inmates from harm,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “Although the county has consulted with the Justice Department for years, our latest assessment reveals serious deficiencies that require further corrective action. We are hopeful that county officials will continue their long-standing cooperation to ensure that sustainable reforms are implemented fully.”

The department intends to enter into discussions with county officials from the Los Angeles County Sheriff’s Department and the county’s Department of Mental Health to address the results of the evaluation. The department expects that those MOA requirements that are in substantial compliance will terminate and no longer be subject to monitoring. The department will propose additional corrective action in the form of a court-enforceable agreement to address the remaining areas with serious deficiencies that violate prisoners’ constitutional rights. The department’s compliance letter includes a comprehensive list of recommended remedial measures that are designed to ensure adequate mental health treatment, supervision, suicide prevention and conditions of confinement for prisoners throughout the jails.

The challenges that the county faces in providing constitutionally adequate mental health services at the jail are driven in part by a rapid increase in the number of prisoners who are seriously mentally ill. The county has begun to take steps to expand diversion programs that will provide community supervision and treatment in a manner consistent with public safety. The department applauds these efforts.

CRIPA was enacted in 1980 to eradicate egregious and harmful conditions that result in a pattern or practice of civil rights violations in jails, prisons, juvenile justice facilities and other public institutions. CRIPA authorizes the department to investigate and, if necessary, initiate a civil action to guarantee the federal and constitutional rights of institutionalized persons.

The MOA is enforced by the Special Litigation Section of the Civil Rights Division and the U.S. Attorney’s Office for the Central District of California, Civil Division. A copy of the MOA can be obtained on the department’s website and additional information about the Civil Rights Division’s enforcement activities under CRIPA can be found at the division website .

This news is courtesy of www.justice.gov

Ashland Hospital Corp. d/b/a King’s Daughters Medical Center (KDMC) has agreed to pay $40.9 million to resolve allegations that it submitted false claims to the Medicare and Kentucky Medicaid programs for medically unnecessary coronary stents and diagnostic catheterizations and had prohibited financial relationships with physicians referring patients to the hospital, the Justice Department announced today.

Assistant Attorney General Stuart F. Delery of the Justice Department’s Civil Division, U.S. Attorney Kerry Harvey for the Eastern District of Kentucky and Special Agent in Charge Derrick L. Jackson at the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Kentucky region made the announcement.

“Hospitals that place their financial interests above the well-being of their patients will be held accountable,” said Assistant Attorney General Delery. “ The Department of Justice will not tolerate those who abuse federal health care programs and put the beneficiaries of these programs at risk by providing medically unnecessary care.”

The government alleged that, between 2006 and 2011, KDMC billed for numerous unnecessary coronary stents and diagnostic catheterizations performed by KDMC physicians on Medicare and Medicaid patients who did not need them. The government also alleged that the physicians falsified medical records in order to justify these unnecessary procedures, which allegedly generated millions of dollars in Medicare and Kentucky Medicaid reimbursements for KDMC.

“The conduct alleged in this matter is unacceptable, victimizing both taxpayers and patients,” said U.S. Attorney Harvey. “Treatment decisions motivated by financial gain undermine public confidence in our health care system and threaten vital federal programs upon which so many of our citizens rely. We will not relent in our efforts to protect the public from the sort of systematic misconduct alleged in this case.”

The settlement also resolves allegations that KDMC violated the Stark Law by paying certain cardiologists salaries that were unreasonably high and in excess of fair market value. The Stark Law is designed to limit the influence of money on physicians’ medical decision-making by prohibiting financial relationships between hospitals and referring physicians, unless these relationships meet certain designated exceptions.

In connection with this settlement, KDMC has agreed to enter into a Corporate Integrity Agreement with HHS-OIG, which obligates the hospital to undertake substantial internal compliance reforms and to commit to a third-party review of its claims to federal health care programs for the next five years.

“Medically unnecessary procedures can cause serious health issues, cost the taxpayers millions of dollars each year and drain the Medicare Trust Fund,” said Special Agent in Charge Jackson. “The OIG will continue to protect beneficiaries and hold health care providers accountable for improper claims.”

“This type of alleged conduct deceives individuals when they are seeking medical treatment and are vulnerable,” said Special Agent in Charge Perrye K. Turner of the FBI’s Louisville Field Division. “The level of funds involved in this matter is staggering. This money has been stolen from the patients and the taxpayers.”

The Commonwealth of Kentucky will receive approximately $1,018,380, which represents the state’s share of the recovered Medicaid funds. The Medicaid program is funded jointly by the federal and state governments.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $19 billion through False Claims Act cases, with more than $13.4 billion of that amount recovered in cases involving fraud against federal health care programs.

The investigation was conducted by the FBI, the HHS-OIG, the Kentucky Office of Attorney General, Medicaid Fraud and Abuse Control Unit, the Commercial Litigation Branch of the Department of Justice’s Civil Division and the U.S. Attorney’s Office for the Eastern District of Kentucky. The claims settled by this agreement are allegations only, and there has been no determination of liability.

This news is courtesy of www.justice.gov

A grand jury in the Western District of Pennsylvania (WDPA) indicted five Chinese military hackers for computer hacking, economic espionage and other offenses directed at six American victims in the U.S. nuclear power, metals and solar products industries.

The indictment alleges that the defendants conspired to hack into American entities, to maintain unauthorized access to their computers and to steal information from those entities that would be useful to their competitors in China, including state-owned enterprises (SOEs). In some cases, it alleges, the conspirators stole trade secrets that would have been particularly beneficial to Chinese companies at the time they were stolen. In other cases, it alleges, the conspirators also stole sensitive, internal communications that would provide a competitor, or an adversary in litigation, with insight into the strategy and vulnerabilities of the American entity.

“This is a case alleging economic espionage by members of the Chinese military and represents the first ever charges against a state actor for this type of hacking,” U.S. Attorney General Eric Holder said. “The range of trade secrets and other sensitive business information stolen in this case is significant and demands an aggressive response. Success in the global market place should be based solely on a company’s ability to innovate and compete, not on a sponsor government’s ability to spy and steal business secrets. This Administration will not tolerate actions by any nation that seeks to illegally sabotage American companies and undermine the integrity of fair competition in the operation of the free market.”

“For too long, the Chinese government has blatantly sought to use cyber espionage to obtain economic advantage for its state-owned industries,” said FBI Director James B. Comey. “The indictment announced today is an important step. But there are many more victims, and there is much more to be done. With our unique criminal and national security authorities, we will continue to use all legal tools at our disposal to counter cyber espionage from all sources.”

“State actors engaged in cyber espionage for economic advantage are not immune from the law just because they hack under the shadow of their country’s flag,” said John Carlin, Assistant Attorney General for National Security. “Cyber theft is real theft and we will hold state sponsored cyber thieves accountable as we would any other transnational criminal organization that steals our goods and breaks our laws.”

“This 21st century burglary has to stop,” said David Hickton, U.S. Attorney for the Western District of Pennsylvania. “This prosecution vindicates hard working men and women in Western Pennsylvania and around the world who play by the rules and deserve a fair shot and a level playing field.”

This news is courtesy of www.justice.gov

Credit Suisse AG pleaded guilty today to conspiracy to aid and assist U.S. taxpayers in filing false income tax returns and other documents with the Internal Revenue Service (IRS). The guilty plea by the Swiss corporation is the result of a years-long investigation by U.S. law enforcement authorities that has also produced indictments of eight Credit Suisse executives since 2011; two of those individuals have pleaded guilty so far.

The plea agreement, along with agreements made with state and federal partners, provides that Credit Suisse will pay a total of $2.6 billion – $1.8 billion to the Department of Justice for the U.S. Treasury, $100 million to the Federal Reserve, and $715 million to the New York State Department of Financial Services. The plea agreement was filed in the Eastern District of Virginia today. Earlier this year, Credit Suisse paid approximately $196 million in disgorgement, interest and penalties to the Securities and Exchange Commission (SEC) for violating the federal securities laws by providing cross-border brokerage and investment advisory services to U.S. clients without first registering with the SEC. That settlement with the SEC is also reflected in today’s plea agreement. Together, these actions by U.S. law enforcement and state and federal partners appropriately punish Credit Suisse for its past behavior in these matters.

The announcement was made by Attorney General Eric H. Holder, Deputy Attorney General James M. Cole, Assistant Attorney General Kathryn Keneally for the Justice Department’s Tax Division, U.S. Attorney Dana J. Boente for the Eastern District of Virginia, and Commissioner John Koskinen of the IRS.

“This case shows that no financial institution, no matter its size or global reach, is above the law,” said Attorney General Holder. “Credit Suisse conspired to help U.S. citizens hide assets in offshore accounts in order to evade paying taxes. When a bank engages in misconduct this brazen, it should expect that the Justice Department will pursue criminal prosecution to the fullest extent possible, as has happened here.”

As part of the plea agreement, Credit Suisse acknowledged that, for decades prior to and through 2009, it operated an illegal cross-border banking business that knowingly and willfully aided and assisted thousands of U.S. clients in opening and maintaining undeclared accounts and concealing their offshore assets and income from the IRS.

“Credit Suisse’s guilty plea is just the latest effort by the department to slam the door shut on undeclared bank accounts, phony trusts and other foreign schemes used by U.S. taxpayers to evade taxes,” said Deputy Attorney General Cole. “We will continue to hold to account the bankers, the brokers and other professionals in Switzerland and around the world as well as the institutions that trained and directed them to use bank secrecy laws to protect U.S. tax cheats.”

According to the statement of facts filed with the plea agreement, Credit Suisse employed a variety of means to assist U.S. clients in concealing their undeclared accounts, including by:

• assisting clients in using sham entities to hide undeclared accounts;
• soliciting IRS forms that falsely stated, under penalties of perjury, that the sham entities were the beneficial owners of the assets in the accounts;
• failing to maintain in the United States records related to the accounts;
• destroying account records sent to the United States for client review;
• using Credit Suisse managers and employees as unregistered investment advisors on undeclared accounts;
• facilitating withdrawals of funds from the undeclared accounts by either providing hand-delivered cash in the United States or using Credit Suisse’s correspondent bank accounts in the United States;
• structuring transfers of funds to evade currency transaction reporting requirements; and
• providing offshore credit and debit cards to repatriate funds in the undeclared accounts.

As part of the plea agreement, Credit Suisse further agreed to make a complete disclosure of its cross-border activities, cooperate in treaty requests for account information, provide detailed information as to other banks that transferred funds into secret accounts or that accepted funds when secret accounts were closed, and to close accounts of account holders who fail to come into compliance with U.S. reporting obligations. Credit Suisse has also agreed to implement programs to ensure its compliance with U.S. laws, including its reporting obligations under the Foreign Account Tax Compliance Act and relevant tax treaties, in all its current and future dealings with U.S. customers.

“Today’s plea by Credit Suisse is a significant step in our global enforcement against those who would avoid their tax obligations by hiding their assets in foreign bank accounts, and those financial institutions, bankers, and other professionals who facilitate this conduct,” said Assistant Attorney General Keneally for the Tax Division. “Credit Suisse has also changed its business operations to ensure that U.S. taxpayers will no longer be able to hide their assets at Credit Suisse, and provided the government with valuable information that will further our investigations.”

“This prosecution and plea should serve notice that secret accounts and assisting the evasion of income taxes has a high cost,” said U.S. Attorney Boente. “Concealing financial accounts from the U.S. government is not a legitimate part of wealth management or private banking services.”

“Pursuing international tax evasion is a priority area for IRS Criminal Investigation, and we will continue to follow the money here in the United States and around the world” said IRS Commissioner Koskinen. “I want to commend the special agents in IRS-Criminal Investigation for all of their hard work in this area and the close cooperation with the Department of Justice. Today’s guilty plea is another important milestone in ongoing law enforcement efforts to investigate the use of offshore accounts to evade taxes. People should no longer feel comfortable hiding their assets and income from the IRS.”

The Board of Governors of the Federal Reserve System is also announcing today that it has reached a resolution with Credit Suisse, by which Credit Suisse has agreed to a cease and desist order, certain remedial steps to ensure its compliance with U.S. law in its ongoing operations, and a civil monetary penalty of $100 million. Additionally, the New York State Department of Financial Services is announcing a similar resolution by which Credit Suisse has agreed to a cease and desist order and a monetary penalty of $715 million.

* * *

On Feb. 23, 2011, a grand jury in the Eastern District of Virginia returned an indictment charging four Credit Suisse employees – Marco Parenti Adami, a former Credit Suisse manager; Emanuel Agustino, a former Credit Suisse banker; Michele Bergantino. a former Credit Suisse banker; and Roger Schaerer, Credit Suisse’s former Representative Officer in its Representative Office in New York – with conspiring with other Swiss bankers and U.S. taxpayers to defraud the United States. On July 21, 2011, the grand jury returned a superseding indictment adding four additional defendants charged with the conspiracy to defraud the United States. The four new defendants were: Markus Walder, the former head of North America Offshore Banking at Credit Suisse; Süsanne D. Rüegg Meier, a former Credit Suisse manager; Andreas Bachmann, a former banker at Credit Suisse Fides, a subsidiary of Credit Suisse; and Josef Dörig, a former Credit Suisse Fides employee and owner/operator of a trust company. On March 12, 2014, Bachmann pleaded guilty to the superseding indictment in connection with his work as a banker at Credit Suisse Fides. On April 30, 2014, Dörig pleaded guilty to conspiring to defraud the IRS in connection with his role managing offshore entities used by U.S. taxpayers to conceal their accounts at Credit Suisse. Those pleas were accepted by U.S. District Judge Gerald Bruce Lee. Bachmann and Dörig each face maximum penalties of five years in prison when they are sentenced on Aug. 8, 2014.

This news is courtesy of www.justice.gov

The Department of Justice filed a lawsuit today against Con-Way Freight Inc. alleging that the company violated the Uniformed Services Employment and Reemployment Rights Act (USERRA) by failing to promptly reassign Naval Reservist Dale Brown to his former position as a driver with appropriate seniority once he notified the company that he had fully recovered from a temporary service-related medical disability.

According to the complaint, filed in the U.S. District Court for the Northern District of Illinois, Brown began working for Con-Way on Nov. 9, 1987, as a driver sales representative (DSR). In 2006, Brown was working at Con-Way’s Rock Island, Ill., facility when he deployed for active duty. While in Iraq, Brown suffered a serious shoulder injury in a truck accident during a night mission and returned to Con-Way in 2009 following an honorable discharge. Con-Way placed him in a lower-paying position due to medical restrictions that prevented him from returning to the DSR position. By 2012, Brown had made a full recovery and notified the company that he was able to resume work as a DSR without medical restrictions. Con-Way refused to return Brown to the DSR position and instead made him apply for open positions as they became available. Months later, Brown was eventually hired as a DSR, but, Con-Way treated him as a new employee with no seniority to bid on assignments. As a result, Brown effectively received a 40 percent reduction in pay compared to what he was earning as a DSR prior to his military leave. He also no longer has a regular work schedule because his seniority was not restored upon resinstatement and he must call in each day to see if and for how long he will work on a given day.

USERRA obligates employers to promptly reemploy returning servicemembers and place them as near as possible in the position that they would have been in absent military service, or a position of similar seniority, status and pay. For servicemembers like Brown who return with a service-connected disability, the reemployment obligation extends to providing accommodations to the servicemember, which can include a temporary position until the servicemember has recovered and is able to return to his or her proper reemployment position. Contrary to these requirements, Con-Way violated USERRA by treating Brown as a newly hired DSR, with no accrued seniority, rather than placing him in the position that he would have held had he not served his country and suffered a serious and debilitating injury that required temporary accomodation.

The lawsuit seeks an adjustment to Brown’s seniority date as a DSR to his pre-deployment date with back wages for Con-Way’s six month delay in reemploying Brown once he asked for reinstatement as a DSR following his medical clearance, and his inability to bid on desirable shifts and routes due to his lack of seniority.

“Employers have a legal obligation under USERRA to accommodate servicemembers who suffer a disability while serving their country,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “The Civil Rights Division is committed to protecting the rights of those who have served their country through military service.”

This case stems from a referral by the U.S. Department of Labor (DOL) following an investigation by the DOL’s Veterans’ Employment and Training Service. The case is being handled by the Employment Litigation Section of the Civil Rights Division.

This news is courtesy of www.justice.gov

WASHINGTON – The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today designated sixteen Russian government officials, members of the Russian leadership’s inner circle, including a Russian bank pursuant to Executive Order (E.O.) 13661, which was signed by President Obama on March 16, 2014. E.O. 13661 authorizes sanctions on, among others, officials of the Russian Government and any individual or entity that is owned or controlled by, that has acted for or on behalf of, or that has provided material or other support to, a senior Russian government official.

The sixteen individuals being sanctioned as Russian government officials are: Viktor Ozerov, Vladimir Dzhabarov, Evgeni Bushmin, Nikolai Ryzhkov, Sergei Zheleznyak, Sergei Mironov, Aleksandr Totoonov, Oleg Panteleev, Sergey Naryshkin, Victor Ivanov, Igor Sergun, Sergei Ivanov, Alexei Gromov, Andrei Fursenko, Vladimir Yakunin, and Vladimir Kozhin

Those being designated for acting for or on behalf of or materially assisting, sponsoring, or providing financial, material, or technological support for, or goods or services to or in support of, a senior official of the Government of the Russian Federation are: Gennady Timchenko, Arkady Rotenberg, Boris Rotenberg, Yuri Kovalchuk and Bank Rossiya. In addition to being designated for providing material support to Russian government officials, Bank Rossiya is also being designated for being controlled by designated inner circle member Kovalchuk.

“With its currency near an all-time low, its stock market down twenty percent this year and a marked rise in interest rates, Russia has already started to bear the economic costs of its unlawful effort to undermine Ukraine’s security, stability, and sovereignty,” said Under Secretary for Terrorism and Financial Intelligence David S. Cohen. “As President Obama has made clear, we will continue to impose costs in direct response to Russia’s provocative acts, even as we have made clear there is a path to de-escalate the situation in Ukraine that respects Ukraine’s sovereignty and territorial integrity and takes account of Russia’s legitimate interests.”

Russian Government Officials and Members of the Inner Circle:

Government Officials

The following sixteen individuals are being designated because they are officials of the Russian government. Although not the basis for the designation, several are also very close advisors to senior Russian government officials.

Viktor Ozerov is the Chairman of the Security and Defense Committee of the Federation Council of the Russian Federation. On March 1, 2014, Ozerov supported Russian President Vladimir Putin’s appeal regarding the use of the Russian Armed Forces in Ukraine.

Vladimir Dzhabarov is the First Deputy Chairman of the International Affairs Committee of the Federation Council of the Russian Federation. On March 1, 2014, Dzhabarov supported the Putin’s appeal regarding the use of the Russian Armed Forces in Ukraine.

Evgeni Bushmin is the Deputy Speaker of the Federation Council of the Russian Federation. On March 1, 2014, Bushmin publicly supported the deployment of Russian forces in Ukraine.

Nikolai Ryzhkov is a Senator in the Russian Upper House of Parliament (Federation Council). Ryzhkov publicly supported the deployment of Russian forces in Ukraine.

Sergei Zheleznyak is the Deputy Speaker of the State Duma of the Russian Federation.

Sergei Mironov is a Member of the Council of the State Duma, a Member of the State Duma Committee on Housing Policy and Housing and Communal Services, and Leader of the Fair Russia Faction in the Duma of the Russian Federation.

Aleksandr Totoonov is a Member of the Committee on Culture, Science, and Information, Federation Council of the Russian Federation. On March 1, 2014, Totoonov publicly supported the deployment of Russian forces in Ukraine.

Oleg Panteleev is the First Deputy Chairman of the Committee on Parliamentary Issues. On March 1, 2014, Panteleev publicly supported the deployment of Russian forces in Ukraine.

Sergey Naryshkin has been the Chairman of the Government Duma of the Federal Gathering of the Russian Federation since December, 2011. Additionally, he is a member of the National Security Council of the Russian Federation and of the United Russia party.

Victor Ivanov has been director of the Federal Drug Control Service (FSKN) of the Russian Federation since May 15, 2008; he was appointed as a member of the Security Council of the Russian Federation on May 25, 2008. Ivanov has served in a number of other government positions prior to that; he was Assistant to the President of the Russian Federation from 2004 – 2008; and Deputy Chief of the Administration of the Russian Federation from 2000 – 2004. Ivanov joined the KGB in 1977 and eventually rose to become the Deputy Director of the Federal Security Service. Ivanov is a close ally of Putin and served alongside Putin as the chief of staff of the St. Petersburg Mayor’s office in 1994 when Putin was first deputy head of the city’s administration.

Igor Sergun is the head of Russia’s military intelligence service (GRU) and is Deputy Chief of the General Staff.

Sergei Ivanov is the Chief of Staff of the Presidential Executive Office.

Alexei Gromov is the First Deputy Chief of Staff of the Presidential Executive Office.

Andrei Fursenko is an aide to the President of the Russian Federation and has been in that position since May 21, 2012. Fursenko has held a number of positions in the Government of the Russian Federation since 2001, including Minister of Education and Science from 2004 – 2012. Although not being designated for being a member of the Russian leadership’s inner circle, Fursenko first met Putin in 1993 and they remain closely associated.

Vladimir Yakunin was appointed as chairman of the board of the Russian state-owned company Russian Railways on June 15, 2005; he has remained as head of the company ever since. Yakunin is being designated because of his official position in the Russian government, but he is also a close confidant of Putin. Yakunin regularly consults with Putin on issues regarding the Russian Railways company. In addition, Yakunin accompanies Putin on many domestic and international visits. Yakunin met Putin while both were working in St. Petersburg. Yakunin decided to create a business center in the city and contacted Putin for his support. In addition, Yakunin became a member of the board of the Baltic Maritime Steamship Company on Putin’s instructions. Yakunin and Putin were also neighbors in the elite dacha community on the shore of Lake Komsomolsk and they served as cofounders of the Ozero Dacha Cooperative in November 1996.

Vladimir Kozhin was appointed the Head of Administration under the President of the Russian Federation by Putin on January 21, 2000. He has served continuously in that position until the present time. Kohzin is responsible for overseeing a staff of 60,000, over a hundred enterprises and institutions including the Kremlin and several other government buildings, and over four thousand vehicles. Kohzin’s positions have been variously referred to as Head of Administration, Head of the Presidential Affairs Office, Head of the Presidential Business Management Directorate of the Russian Federation, and head of the Presidential Property Management Directorate.

Members of the Inner Circle

The following individuals are being designated because each is controlled by, has acted for or on behalf of, or has provided material or other support to, a senior Russian government official.
Gennady Timchenko is one of the founders of Gunvor, one of the world’s largest independent commodity trading companies involved in the oil and energy markets. Timchenko’s activities in the energy sector have been directly linked to Putin. Putin has investments in Gunvor and may have access to Gunvor funds.

Arkady Rotenberg and Boris Rotenberg have provided support to Putin’s pet projects by receiving and executing high price contracts for the Sochi Olympic Games and state-controlled Gazprom. They have made billions of dollars in contracts for Gazprom and the Sochi Winter Olympics awarded to them by Putin. Both brothers have amassed enormous amounts of wealth during the years of Putin’s rule in Russia. The Rotenberg brothers received approximately $7 billion in contracts for the Sochi Olympic Games and their personal wealth has increased by $2.5 billion in the last two years alone.

Yuri Kovalchuk is the largest single shareholder of Bank Rossiya and is also the personal banker for senior officials of the Russian Federation including Putin. Kovalchuk is a close advisor to President Putin and has been referred to as one of his “cashiers.”

The following entity is being designated because it is controlled by, has acted for or on behalf of, or has provided material or other support to, senior Russian government officials.

Bank Rossiya (ОАО АБ РОССИЯ) is the personal bank for senior officials of the Russian Federation. Bank Rossiya’s shareholders include members of Putin’s inner circle associated with the Ozero Dacha Cooperative, a housing community in which they live. Bank Rossiya is also controlled by Kovalchuk, designated today. Bank Rossiya is ranked as the 17th largest bank in Russia with assets of approximately $10 billion, and it maintains numerous correspondent relationships with banks in the United States, Europe, and elsewhere. The bank reports providing a wide range of retail and corporate services, many of which relate to the oil, gas, and energy sectors.

As a result of Treasury’s action, any assets of the persons designated today that are within U.S. jurisdiction must be frozen. Additionally, transactions by U.S. persons or within the United States involving the individuals and entity designated today are generally prohibited.

Identifying Information

Name: Viktor Alekseevich Ozerov
DOB: January 5, 1958
POB: Abakan, Khakassia, Russia
Title: Chairman of the Security and Defense Committee of the Federation Council of the Russian Federation

Name: Vladimir Michailovich Dzhabarov
AKA: Vladimir Dzhabarov
DOB: September 29, 1952
Title: First Deputy Chairman of the International Affairs Committee of the Federation Council of the Russian Federation

Name: Evgeni Viktorovich Bushmin
AKA: Evgeny Bushmin
AKA: Yevgeny Bushmin
DOB: October 10, 1958
POB: Lopatino, Sergachiisky Region, Russia
Title: Deputy Speaker of the Federation Council of the Russian Federation

Name: Nikolai Ivanovich Ryzhkov
AKA: Nikolai Ryzhkov
DOB: September 28, 1929
POB: Duleevka, Donetsk Region, Ukraine
Title: Member of the Committee for Federal Issues, Regional Politics and the North of the Federation Council of the Russian Federation
Title: Senator in the Russian Upper House of Parliament

Name: Sergei Vladimirovich Zheleznyak
AKA: Sergei Zheleznyak
AKA: Sergey Zheleznyak
DOB: July 30, 1970
POB: Saint Petersburg, Russia
Title: Deputy Speaker of the State Duma of the Russian Federation

Name: Sergei Mikhailovich Mironov
AKA: Sergei Mironov
DOB: February 14, 1953
POB: Pushkin, Saint Petersburg, Russia
Title: Member of the Council of the State Duma, Member of the State Duma Committee on Housing Policy and Housing and Communal Services, and Leader of the Fair Russia Faction in the Duma of the Russian Federation

Name: Aleksandr Borisovich Totoonov
AKA: Alexander B. Totoonov
AKA: Alexander Totoonov
DOB: March 3, 1957
POB: Ordzhonikidze, North Ossetia, Russia
POB: Vladikavkaz, North Ossetia, Russia
Title: Member of the Committee on Culture, Science, and Information, Federation Council of the Russian Federation

Name: Oleg Evgenevich Panteleev
AKA: Oleg Panteleev
DOB: July 21, 1952
POB: Zhitnikovskoe, Kurgan Region, Russia
Title: First Deputy Chairman of the Committee on Parliamentary Issues

Name: Sergey Yevgenyevich Naryshkin
AKA: Sergei Naryshkin
DOB: October 27, 1954
POB: Saint Petersburg, Russia

Name: Victor Petrovich Ivanov
AKA: Viktor Ivanov
DOB: May 12, 1950
alt. DOB: 1952
POB: Novgorod, Russia

Name: Igor Dmitrievich Sergun
DOB: March 28, 1957
Title: Lieutenant General; Chief of the Main Directorate of the General Staff (GRU), Deputy
Chief of the General Staff

Name: Sergei Ivanov
AKA: Sergey Ivanov
DOB: January 31, 1953
POB: Saint Petersburg, Russia
Title: Chief of Staff of the Presidential Executive Office

Name: Alexei Gromov
DOB: 1960
POB: Zagorsk (Sergiev, Posad), Moscow Region, Russia
Title: First Deputy Chief of Staff of the Presidential Executive Office
Title: Presidential Administration Deputy Chief of Staff
Title: First Deputy Presidential Chief of Staff

Name: Andrei Alexandrovich Fursenko
AKA: Andrei Fursenko
AKA: Andrey Fursenko
DOB: July 17, 1949
POB: Saint Petersburg, Russia
Title: Aide to the President of the Russian Federation

Name: Vladimir Ivanovich Yakunin
DOB: June 30, 1948
POB: Zakharovo Village, Gus-Khrustalnyy Rayon, Vladimir Oblast, Russia
alt. POB: Melenki, Vladimir Oblast, Russia

Name: Vladimir Igorevich Kozhin
DOB: February 28, 1959
POB: Troitsk, Chelyabinsk Oblast, Russia
Name: Gennady Timchenko
AKA: Gennadiy Nikolayevich Timchenko
AKA: Gennady Nikolayevich Timchenko
AKA: Guennadi Timtchenko
Address: Geneva, Switzerland
DOB: November 9, 1952
POB: Leninakan, Armenia
alt. POB: Gyumri, Armenia
Nationality: Finland, Russia, Armenia

Name: Arkady Rotenberg
DOB: December 15, 1951
POB: Saint Petersburg, Russia

Name: Boris Rotenberg
DOB: January 3, 1957
POB: Saint Petersburg Russia

Name: Yuri Valentinovich Kovalchuk
AKA: Yury Valentinovich Kovalchuk
DOB: July 25, 1951
POB: Saint Petersburg, Russia

Name: Bank Rossiya
FKA: Aktsionerny BANK Russian Federation
Address: 2 Liter A Pl. Rastrelli, Saint Petersbrug, 191124, Russia
E-mail: bank@abr.ru
Web Site: www.abr.ru
SWIFT/BIC: ROSY RU 2P

The Department of Justice and the U.S. Environmental Protection Agency (EPA) announced today that Flint Hills Resources of Port Arthur has agreed to implement innovative technologies to control harmful air pollution from industrial flares and leaking equipment at the company’s chemical plant in Port Arthur, Texas. This settlement is part of EPA’s national effort to advance environmental justice by protecting communities such as Port Arthur that have been disproportionately impacted by pollution. The company is also required to pay a $350,000 penalty for Clean Air Act violations.

Once fully implemented, EPA estimates that the settlement will reduce emissions of volatile organic compounds (VOCs), including benzene and other hazardous air pollutants (HAPs), by an estimated 1,880 tons per year, and will reduce emissions of greenhouse gases by approximately 69,000 tons per year.

“This agreement reflects the Justice Department’s and the EPA’s commitment to alleviate the environmental and human health challenges faced by vulnerable communities,” said Acting Assistant Attorney General Robert G. Dreher of the Justice Department’s Environment and Natural Resources Division. “This settlement will mean cleaner, healthier air for residents of the Port Arthur area who continue to bear a disproportionate burden from the impacts of industrial pollution.”

“Communities like Port Arthur are a focus of our enforcement efforts as they have been hit hard by air pollution,” said Cynthia Giles, Assistant Administrator for EPA’s Office of Enforcement and Compliance Assurance. “ By working with EPA, Flint Hills has advanced new air pollution controls that will help EPA bring similar air quality improvements to other American communities. EPA will continue to focus on tough pollution controls and cutting edge technologies in order to reduce the burden of air pollution on Americans who need it most.”

The settlement requires Flint Hills to operate state‑of‑the‑art equipment to recover and recycle waste gases and to ensure that gases sent to flares are burned with 98 percent efficiency. The company has spent approximately $16 million to implement these required controls on industrial flares.

When the agreement is fully implemented, the company estimates it will spend $28 million to reduce “fugitive” pollutant emissions that may leak from valves, pumps, and other equipment. The company must monitor leaks more frequently, implement more aggressive repair practices, adopt innovative new practices designed to prevent leaks and replace valves with new “low emissions” valves or use packing material to reduce leaks.

To further mitigate pollution impacting the community, the company will spend $2 million on a diesel retrofit or replacement project that is estimated to reduce nitrogen oxides and particulate matter by a combined 85 tons, in addition to 39 tons of carbon monoxide, over the next 15 years. The company will also spend $350,000 to purchase and install technologies to reduce energy demand in low income homes.

For the past several years, Flint Hills has operated a system to monitor the ambient levels of the hazardous air pollutants benzene and 1,3-butadiene at the boundaries of the facility, also known as the “fence line.” The company has used the information collected to identify and reduce potential pollutant sources for communities living near the facility. In this settlement, Flint Hills has agreed to make its fence line monitoring data available online to the public.

The complaint, filed by DOJ on behalf of EPA at the same time as the settlement, alleges that the company improperly operated its steam-assisted flaring devices in a way that emitted excess amounts of VOCs, including benzene and other hazardous air pollutants. It also alleges violations of EPA regulations designed to limit emissions from leaking equipment.

The measures required by the settlement will cut emissions of pollutants that can cause significant harm to public health. VOCs are a key component in the formation of smog or ground-level ozone, a pollutant that irritates the lungs, exacerbates diseases such as asthma, and can increase susceptibility to respiratory illnesses, such as pneumonia and bronchitis. Chronic exposure to benzene, which EPA classifies as a carcinogen, can cause numerous health impacts, including leukemia and adverse reproductive effects in women.

Today’s settlement is part of EPA’s national effort to reduce emissions of toxic air pollutants, with a particular focus on industrial flares and leaks from equipment. Improper operation of an industrial flare can emit hundreds of tons of hazardous pollutants into the air. EPA encourages companies to flare less, and when they do flare, to fully burn the harmful chemicals found in the waste gas.

Flint Hills’ plant in Port Arthur manufactures chemicals that are used in a variety of products, including medical devices, automotive parts and appliance components. The Port Arthur facility has the capacity to produce nearly 1.4 billion pounds of ethylene and 700 million pounds of propylene annually.

NEW YORK, NY, – Today, Toyota announced that it reached an agreement with the U.S. Attorney’s Office for the Southern District of New York to resolve its investigation initiated in February 2010 into the communications and decision-making processes related to the company’s 2009-2010 recalls to address potential “sticking” accelerator pedals and floor mat entrapment. As part of the agreement, Toyota will make a payment totaling $1.2 billion.

“At the time of these recalls, we took full responsibility for any concerns our actions may have caused customers, and we rededicated ourselves to earning their trust,” said Christopher P. Reynolds, chief legal officer, Toyota Motor North America. “In the more than four years since these recalls, we have gone back to basics at Toyota to put our customers first.”

Reynolds continued: “We have made fundamental changes across our global operations to become a more responsive company – listening better to our customers’ needs and proactively taking action to serve them.

“Specifically, we have taken a number of steps that have enabled us to enhance quality control, respond more quickly to customer concerns, strengthen regional autonomy and speed decision-making. And, we’re committed to continued improvement in everything we do to keep building trust in our company, our people and our products. Importantly, Toyota addressed the sticky pedal and floor mat entrapment issues with effective and durable solutions, and we stand behind the safety and quality of our vehicles.

“Entering this agreement, while difficult, is a major step toward putting this unfortunate chapter behind us. We remain extremely grateful to our customers who have continued to stand by Toyota. Moving forward, they can be confident that we continue to take our responsibilities to them seriously,” Reynolds concluded.

Among the substantive actions the company has voluntarily taken since the recalls are:

• Launching rapid-response teams to investigate customer concerns quickly;

• Committing $50 million in 2011 to launch Toyota’s Collaborative Safety Research Center in Ann Arbor, Michigan to partner with more than 16 universities and institutions across North America on safety advances that will be shared to benefit the entire auto industry and society;

• Expanding its network of field quality offices to improve customer responsiveness;

• Enhancing regional autonomy, including naming the first American CEO of Toyota’s North American Region as well as Chief Quality Officers for North America and other principal regions – all of whom have direct lines to President Akio Toyoda;

• Improving its quality control process; and

• Extending the new vehicle development cycle by four weeks to help ensure reliability and safety.

Under the agreement, the Government agrees to defer prosecution and then dismiss its case, as long as Toyota makes the required monetary payment, abides by the terms of the agreement and continues to cooperate with the Government. The agreement also provides for an independent monitor to review policies and procedures relating to Toyota’s safety communications process, its process for internally sharing vehicle accident information and its process for preparing and sharing certain technical reports.

Toyota will record $1.2 billion in after-tax charges against earnings in the fiscal year ending March 31, 2014 for costs relating to the above agreement.
About Toyota
Toyota (NYSE:TM), the world’s top automaker and creator of the Prius, is committed to building vehicles for the way people live through our Toyota, Lexus and Scion brands. Over the past 50 years, we’ve built more than 25 million cars and trucks in North America, where we operate 14 manufacturing plants (10 in the U.S.) and directly employ more than 40,000 people (more than 32,000 in the U.S.). Our 1,800 North American dealerships (1,500 in the U.S.) sold more than 2.5 million cars and trucks (more than 2.2 million in the U.S.) in 2013 – and about 80 percent of all Toyota vehicles sold over the past 20 years are still on the road today.

Toyota partners with philanthropic organizations across the country, with a focus on education, safety and the environment. As part of this commitment, we share the company’s extensive know-how garnered from building great cars and trucks to help community organizations and other nonprofits expand their ability to do good.

This news is courtesy of www.toyota.com

The Department of Justice has frozen more than $458 million in corruption proceeds hidden in bank accounts around the world by former Nigerian dictator Sani Abacha and conspirators. A civil forfeiture complaint unsealed today in the United States District Court in the District of Columbia seeks recovery of more than $550 million in connection with the largest kleptocracy forfeiture action brought in the department’s history.

The restraint of funds announced today includes approximately $313 million in two bank accounts in the Bailiwick of Jersey and $145 million in two bank accounts in France. In addition, four investment portfolios and three bank accounts in the United Kingdom with an expected value of at least $100 million have also been restrained, but the exact amounts in the accounts will be determined at a later date.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.

“General Abacha was one of the most notorious kleptocrats in memory, who embezzled billions from the people of Nigeria while millions lived in poverty,” said Acting Assistant Attorney General Raman. “This is the largest civil forfeiture action to recover the proceeds of foreign official corruption ever brought by the department. Through our Kleptocracy Initiative, we are seizing the assets of foreign leaders who steal funds that properly belong to the citizens they serve. Today’s action sends a clear message: we are determined and equipped to confiscate the ill-gotten riches of corrupt leaders who drain the resources of their countries.”

“We will not let the U.S. banking system be a tool for dictators to hide their criminal proceeds,” said Assistant Director in Charge Parlave. “This action demonstrates the FBI’s ability to combat international corruption and money laundering by seizing the assets of those involved. I want to thank the special agents, financial analysts and prosecutors whose hard work over the years resulted in today’s announcement.”

The over $458 million in frozen funds and the additional assets named in the complaint represent the proceeds of corruption during and after the military regime of General Abacha, who assumed the office of the president of the Federal Republic of Nigeria through a military coup on Nov. 17, 1993, and held that position until his death on June 8, 1998. The complaint alleges that General Abacha, his son Mohammed Sani Abacha, their associate Abubakar Atiku Bagudu and others embezzled, misappropriated and extorted billions from the government of Nigeria and others, then laundered their criminal proceeds through the purchase of bonds backed by the United States using U.S. financial institutions.

As alleged in the complaint, General Abacha and others systematically embezzled billions of dollars in public funds from the Central Bank of Nigeria on the false pretense that the funds were necessary for national security. The conspirators withdrew the funds in cash and then moved the money overseas through U.S. financial institutions. General Abacha and his finance minister also allegedly caused the Government of Nigeria to purchase Nigerian government bonds at vastly inflated prices from a company controlled by Bagudu and Mohammed Abacha, generating an illegal windfall of more than $282 million. In addition, General Abacha and his associates allegedly extorted more than $11 million from a French company and its Nigerian affiliate in connection with payments on government contracts. Funds involved in each of these schemes were allegedly laundered through the United States.

The complaint seeks to forfeit bank accounts and investment portfolios with funds located in Bailiwick of Jersey, France and the United Kingdom. On Feb. 25 and 26, 2014, U.S. arrest warrants for the assets were enforced in Jersey and France though mutual legal assistance requests and in the United Kingdom through litigation brought pursuant to the U.K. Civil Jurisdiction and Judgments Act. The complaint also seeks to forfeit five corporate entities registered in the British Virgin Islands.

This case was brought under the Kleptocracy Asset Recovery Initiative by a team of dedicated prosecutors in the Criminal Division’s Asset Forfeiture and Money Laundering Section, working in partnership with federal law enforcement agencies to forfeit the proceeds of foreign official corruption and, where appropriate, return those proceeds to benefit the people harmed by these acts of corruption and abuse of office. Individuals with information about possible proceeds of foreign corruption located in or laundered through the United States should contact federal law enforcement or send an email to kleptocracy@usdoj.gov.

The investigation was conducted by the FBI. The case is being prosecuted by Trial Attorney Elizabeth Aloi and Assistant Deputy Chief Daniel Claman of the Criminal Division’s Asset Forfeiture and Money Laundering Section, with substantial support from the Criminal Division’s Office of International Affairs. The department appreciates the extensive assistance provided by the Governments of Jersey, France and the United Kingdom in this investigation.

This Press Release is courtesy of www.justice.gov

WASHINGTON – Credit Suisse opened Swiss accounts for over 22,000 U.S. customers with assets that, at their peak, totaled roughly $10 billion to $12 billion, the vast majority of which were hidden from U.S. authorities, but U.S. law enforcement officials have been slow to collect the unpaid taxes or hold accountable the tax evaders and bank involved, according to the findings of a two-year investigation by the U.S. Senate Permanent Subcommittee on Investigations.

In connection with the investigation, the Subcommittee is releasing a 175-page bipartisan staff report [2MB pdf] detailing how Swiss banks aided and abetted tax evasion by their U.S. customers, using Credit Suisse, Switzerland’s second largest bank, as a case study. The subcommittee will hold a hearing at 9:30 a.m. Wednesday at which witnesses from Credit Suisse and the Justice Department are scheduled to appear.

“The battle against tax havens using secrecy laws to facilitate U.S. tax evasion has bogged down, causing a huge loss to our treasury,” said Sen. Carl Levin, D-Mich., the subcommittee chairman. “The Credit Suisse case study shows how a Swiss bank aided and abetted U.S. tax evasion, not only from behind a veil of secrecy in Switzerland, but also on U.S. soil by sending Swiss bankers here to open hidden accounts. In response, the Department of Justice has failed to use the U.S. legal tools that won the UBS case and has instead used treaty requests for U.S. client names, relying on Swiss courts with predictably poor results. It’s time to ramp up the collection of taxes due from tax evaders on the billions of dollars hidden offshore.”

“For too long, international financial institutions like Credit Suisse have profited from their offshore tax haven schemes while depriving the U.S. economy of billions of dollars in tax revenues by facilitating U.S. tax evasion,” said Senator John McCain, ranking member of the subcommittee. “As federal regulators begin to crack down on these banks’ illicit practices, it is imperative that they use every legal tool at their disposal to hold these banks fully accountable for willfully deceiving the U.S. government and seek penalties that will deter similar misconduct in the future.”

The subcommittee held a series of hearings in 2008 and 2009 into how banks including UBS, Switzerland’s largest, colluded with U.S. tax evaders, aided by Switzerland’s bank secrecy laws. UBS acknowledged its wrongdoing at a subcommittee hearing and later identified thousands of previously undisclosed U.S. accounts to the IRS, including providing U.S. client names.

The latest report outlines how Credit Suisse engaged in similar conduct from at least 2001 to 2008, sending Swiss bankers into the United States to recruit U.S. customers, opening Swiss accounts that were not disclosed to U.S. authorities, including accounts opened in the name of offshore shell entities, and servicing Swiss accounts here in the United States without leaving a paper trail.

After the UBS scandal broke, Credit Suisse began a series of Exit Projects, and took five years to close Swiss accounts held by 18,900 U.S. clients, leaving just 3,500 U.S. customers still with the bank. Credit Suisse also conducted an internal investigation, but produced no report and identified no leadership failures that allowed the bank to become involved in tax evasion. Despite, in 2011, indictment of seven of its bankers and a DOJ letter notifying the bank that it was itself an investigation target, Credit Suisse has not been held legally accountable by DOJ, and none of its bankers has stood trial.

Despite earlier testimony pledging to use important U.S. legal tools such as grand jury subpoenas and John Doe summonses to obtain the names of U.S. tax evaders, the investigation found that DOJ had failed to use them, choosing instead to file treaty requests with little success. In the past five years, DOJ has not sought to enforce a single grand jury subpoena against a Swiss bank, has not assisted in the filing of a single John Doe summons to obtain client names or account information in Switzerland, and has prosecuted only one Swiss bank, Wegelin &Co., despite more than a dozen under investigation for facilitating U.S. tax evasion. In addition, over the past five years, DOJ has obtained information, including U.S. client names, for only 238 undeclared Swiss accounts out of the tens of thousands opened offshore.

The report also outlines Swiss efforts to preserve bank secrecy by enacting legislation limiting the ability of U.S. treaty requests to obtain U.S. client names, and insisting that a 2013 Swiss bank amnesty program set up by DOJ to issue non-prosecution agreements will not require Swiss banks to disclose U.S. client names.

“Ending tax evasion through offshore accounts is important for our fiscal health,” Levin said. “More importantly, ending these abuses is critical to the fairness of our tax system.”

The Subcommittee investigation reaches several findings of fact:

(1) Bank Practices that Facilitated U.S. Tax Evasion. From at least 2001 to 2008, Credit Suisse employed banking practices that facilitated tax evasion by U.S. customers, including by opening undeclared Swiss accounts for individuals, opening accounts in the name of offshore shell entities to mask their U.S. ownership, and sending Swiss bankers to the United States to recruit new U.S. customers and service existing Swiss accounts without creating paper trails. At its peak, Credit Suisse had over 22,000 U.S. customers with Swiss accounts containing assets that exceeded 12 billion Swiss francs.

(2) Inadequate Bank Response. Credit Suisse’s efforts to close undeclared Swiss accounts opened by U.S. customers took more than five years, failed to identify how many were undeclared accounts hidden from U.S. authorities, and fell short of identifying any leadership failures or lessons learned from its legally-suspect U.S. cross border business.

(3) Lax U.S. Enforcement. Despite the passage of five years, U.S. law enforcement has failed to prosecute more than a dozen Swiss banks that facilitated U.S. tax evasion, failed to take legal action against thousands of U.S. persons whose names and hidden Swiss accounts were disclosed by UBS, and failed to utilize available U.S. legal means to obtain the names of tens of thousands of additional U.S. persons whose identities are still being concealed by the Swiss.

(4) Swiss Secrecy. Since 2008, Swiss officials have worked to preserve Swiss bank secrecy by intervening in U.S. criminal investigations to restrict document production by Swiss banks, pressuring the United States to construct a program for issuing non-prosecution agreements to hundreds of Swiss banks while excusing those banks from disclosing U.S. client names, enacting legislation creating new barriers to U.S. treaty requests seeking U.S. client names, and managing to limit the actual disclosure of U.S. client names to only a few hundred names over five years, despite the tens of thousands of undeclared Swiss accounts opened by U.S. clients evading U.S. taxes.

Based on those findings, the report makes the following recommendations:

(1) Improve Prosecution of Tax Haven Banks and Hidden Offshore Account Holders. To ensure accountability, deter misconduct, and collect tax revenues, the Department of Justice should use available U.S. legal means, including enforcing grand jury subpoenas and John Doe summons in U.S. courts, to obtain the names of U.S. taxpayers with undeclared accounts at tax haven banks. DOJ should hold accountable tax haven banks that aided and abetted U.S. tax evasion, and take legal action against U.S. taxpayers to collect unpaid taxes on billions of dollars in offshore assets.

(2) Increase Transparency of Tax Haven Banks That Impede U.S. Tax Enforcement. U.S. regulators should use their existing authority to institute a probationary period of increased reporting requirements for, or to limit the opening of new accounts by, tax haven banks that enter into deferred prosecution agreements, non-prosecution agreements, settlements, or other concluding actions with law enforcement for facilitating U.S. tax evasion, taking into consideration repetitive or cumulative misconduct.

(3) Streamline John Doe Summons. Congress should amend U.S. tax laws to streamline the use of John Doe summons procedures to uncover the names of taxpayers using offshore accounts and other means to evade U.S. taxes, including by allowing a court to approve more than one John Doe summons related to the same tax investigation.

(4) Close FATCA Loopholes. To obtain systematic disclosure of undeclared offshore accounts used to evade U.S. taxes, the U.S. Treasury and IRS should close gaping loopholes in FATCA regulations that have no statutory basis, including provisions that allow financial institutions to ignore account information stored on paper, and allow foreign financial institutions to treat offshore shell entities as non-U.S. entities even when beneficially owned and controlled by U.S. persons.

(5) Ratify Revised Swiss Tax Treaty. The U.S. Senate should promptly ratify the 2009 Protocol to the U.S.-Switzerland tax treaty to take advantage of improved disclosure standards.

This Press Release is courtesy of www.senate.gov

WASHINGTON – The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today designated Juanita del Carmen Rios Hernandez and her medical supply company Distribuidora e Importadora de Productos Medicos del Norte as specially designated narcotics traffickers pursuant to the Foreign Narcotics Kingpin Designation Act (Kingpin Act). Juanita del Carmen Rios Hernandez is the spouse of Mexican drug lord Miguel Angel Trevino Morales, a leader of Los Zetas drug cartel, who is jailed in Mexico and faces multiple federal indictments in the United States for narcotics and money laundering violations. Prior to his arrest, Miguel Trevino Morales, along with his brother, Omar Trevino Morales, directed the vast drug trafficking activities of Los Zetas, one of Mexico’s most violent and powerful drug trafficking organizations.

Juanita del Carmen Rios Hernandez owns and operates Distribuidora e Importadora de Productos Medicos del Norte, a company involved in the importation, distribution, and sale, of medical supplies in Monterrey, Nuevo Leon, Mexico. Juanita del Carmen Rios Hernandez incorporated this company in 2009 and is its principal shareholder. Today’s action, pursuant to the Kingpin Act, prohibits U.S. persons from conducting financial or commercial transactions with Juanita del Carmen Rios Hernandez or her company, and freezes any assets she or her company may have under U.S. jurisdiction.

“OFAC will be relentless in sanctioning Los Zetas’ leadership and associates to weaken and ultimately collapse the financial infrastructure of this ruthless cartel,” said OFAC Director Adam J. Szubin. “This action builds on the consistent efforts of Treasury and our U.S. and Mexican law enforcement partners to target those operating on behalf of Los Zetas.”

The President identified Los Zetas as a significant foreign narcotics trafficker pursuant to the Kingpin Act in April 2009. On July 24, 2011, the President named Los Zetas a significant Transnational Criminal Organization in the Annex to Executive Order 13581 (Blocking Property of Transnational Criminal Organizations). OFAC designated Los Zetas leaders Miguel and Omar Trevino Morales on July 20, 2009, and March 24, 2010, respectively. On July 15, 2013, Mexican authorities arrested Miguel Trevino Morales. Today’s action was undertaken with the support of the Government of Mexico.

Los Zetas distribute narcotics and launder tens of millions of dollars in illicit proceeds from international drug sales. Today’s action is OFAC’s fifth designation in a string of actions since last year aimed at Los Zetas leadership. In 2013, Treasury aggressively targeted Los Zetas with four separate designation actions. On August 1, 2013, Treasury designated Carolina Fernandez Gonzalez, wife of Zeta boss Omar Trevino Morales, her father, Jesus Fernandez de Luna, and his cattle sales company, Compania Ganadera 5 Manantiales. Omar Trevino Morales established this company for his wife and her father-in-law as a money laundering front to be used by Los Zetas. Through this and other actions, Treasury exposed various aspects of Los Zetas activities, including its bulk cash and drug smuggling operations, its international financial operations, and the businesses used by Los Zetas leaders to launder their illicitly gained funds.

Earlier, in 2012, OFAC designated Francisco Colorado Cessa and his oil services company, ADT Petroservicios, for laundering Los Zetas drug proceeds through the purchase of valuable quarter horses for Miguel Trevino Morales and Omar Trevino Morales. These designations were made in coordination with money laundering charges filed against Colorado Cessa and others in the Western District Court of Texas, Austin Division. In 2013, Colorado Cessa was convicted and sentenced to a 20-year prison term.

Internationally, OFAC has designated more than 1,300 individuals and entities linked to 103 drug kingpins since June 2000. OFAC designations are part of an ongoing effort to apply financial measures against significant foreign narcotics traffickers and their organizations worldwide. Penalties for violations of the Kingpin Act range from civil penalties of up to $1.075 million per violation to more severe criminal penalties. Criminal penalties for corporate officers may include up to 30 years in prison and fines up to $5 million. Criminal fines for corporations may reach $10 million. Other individuals face up to 10 years in prison and fines pursuant to Title 18 of the United States Code for criminal violations of the Kingpin Act.

This Press Release is courtesy of www.treasury.gov

Pharmaceutical company Endo Health Solutions Inc. and its subsidiary Endo Pharmaceuticals Inc. (Endo) have agreed to pay $192.7 million to resolve criminal and civil liability arising from Endo’s marketing of the prescription drug Lidoderm for uses not approved as safe and effective by the Food and Drug Administration (FDA), the Justice Department announced today. The resolution includes a deferred prosecution agreement and forfeiture totaling $20.8 million and civil false claims settlements with the federal government and the states and the District of Columbia totaling $171.9 million. Endo Pharmaceuticals Inc. is a Delaware corporation headquartered in Malvern, Pa.

“FDA’s drug approval process is designed to ensure that companies market their products for uses that are proven to be safe and effective,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “We will hold accountable those who circumvent that process in pursuit of financial gain.”

In a criminal information filed today in the Northern District of New York, the government charged that, between 2002 and 2006, Endo Pharmaceuticals Inc. introduced into interstate commerce Lidoderm that was misbranded under the Federal Food, Drug and Cosmetic Act (FDCA). The FDCA requires a company, such as Endo Pharmaceuticals Inc., to specify the intended uses of a product in its new drug application to the FDA. Once approved, a drug may not be introduced into interstate commerce for unapproved or “off-label” uses until the company receives FDA approval for the new intended uses. During the period of 2002 to 2006, Lidoderm was approved by the FDA only for the relief of pain associated with post-herpetic neuralgia (PHN), a complication of shingles. The information alleges that, during the relevant time period, the Lidoderm distributed nationwide by Endo Pharmaceuticals Inc. was misbranded because its labeling lacked adequate directions for use in the treatment of non-PHN related pain, including low back pain, diabetic neuropathy and carpal tunnel syndrome. These uses were intended by Endo Pharmaceuticals Inc. but never approved by the FDA. The information further alleges that certain Endo Pharmaceuticals Inc. sales managers provided instruction to certain sales representatives concerning how to expand sales conversations with doctors beyond PHN and encouraged promotion of Lidoderm in workers’ compensation clinics.

In a deferred prosecution agreement to resolve the charge, Endo Pharmaceuticals Inc. admitted that it intended that Lidoderm be used for unapproved indications and that it promoted Lidoderm to health care providers for those unapproved indications. Under the terms of the deferred prosecution agreement, Endo Pharmaceuticals Inc. will pay a total of $20.8 million in monetary penalties and forfeiture. Endo Pharmaceuticals Inc. further agreed to implement and maintain a number of enhanced compliance measures, including making publicly available the results of certain clinical trials and requiring an annual review and certification of its compliance efforts by the Chief Executive Officer of its parent company, Endo Health Solutions. The deferred prosecution agreement will not be final until accepted by the U.S. District Court for the Northern District of New York.

“The safety and efficacy of drugs must be shown by science, not sales pitches,” said U.S. Attorney for the Northern District of New York Richard S. Hartunian. “Drugs marketed for intended uses not approved by the FDA are misbranded because their labeling lacks adequate directions for those uses. This settlement emphasizes that public health is protected by labeling based on product performance, rather than profitability, and promotes enhanced efforts to ensure compliance with all requirements.”

In addition, Endo agreed to settle its potential civil liability in connection with its marketing of Lidoderm. The government alleged that, from March 1999 through December 2007, Endo caused false claims to be submitted to federal health care programs, including Medicaid, a jointly funded federal and state program, by promoting Lidoderm for unapproved uses, some of which were not medically accepted indications and, therefore, were not covered by the federal health care programs. Of the $171.9 million Endo has agreed to pay to resolve these civil claims, Endo will pay $137.7 million to the federal government and $34.2 million to the states and the District of Columbia.

“Off-label marketing can undermine the doctor-patient relationship and adversely influence the clear and honest judgment of doctors that their patients rely on and trust,” said U.S. Attorney for the Eastern District of Pennsylvania Zane D. Memeger. “Pharmaceutical companies have a legal obligation to promote their drugs for only FDA-approved uses. This obligation takes precedence over the company’s bottom line.”

“The settlement announced today demonstrates the government’s continued scrutiny of pharmaceutical companies that interfere with FDA’s mission of ensuring that drugs are safe and effective for the American public,” said Special Agent in Charge of the FDA’s Office of Criminal Investigations’ New York Field Office Mark Dragonetti. “We will continue to work with our law enforcement partners to investigate and prosecute pharmaceutical companies that disregard the drug approval process and jeopardize the public health by engaging in the nationwide distribution of misbranded products.”

“Endo Pharmaceutical enriched themselves at the expense of the public,” said Special Agent in Charge Andrew W. Vale of the Albany Division of the Federal Bureau of Investigation. “Patients will search for drug therapies to assist in pain management, and they deserve the right to drugs approved for such use. The FBI will continue to work with our federal partners to investigate companies such as Endo Pharmaceuticals to ensure patients are safe.”

Also as part of the settlement, Endo Pharmaceuticals Inc. has agreed to enter into a Corporate Integrity Agreement (CIA) with the Department of Health and Human Services Office of Inspector General that requires Endo to implement measures designed to avoid or promptly detect conduct similar to that which gave rise to this resolution. Among other things, the CIA requires Endo to implement an internal risk assessment and mitigation program and requires numerous internal and external reviews of promotional and other practices. The CIA also requires key executives and individual board members to sign certifications about compliance, and it requires the company to publicly report information about its financial arrangements with physicians.

“By marketing Lidoderm for uses not covered by federal health care programs, Endo profited at the expense of taxpayers and could have put patients at risk,” said Inspector General of the U.S. Department of Health and Human Services Daniel R. Levinson. “Under our CIA, Endo agrees to promote its products legally, while board members and top executives are specifically held accountable for compliance.”

The civil settlement resolves three lawsuits pending in federal court in the Eastern District of Pennsylvania under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring civil actions on behalf of the government and to share in any recovery. The actions were filed by Peggy Ryan, a former Lidoderm sales representative, Max Weathersby, another former Lidoderm sales representative and Gursheel S. Dhillon, a physician. The whistleblowers’ share of the settlement has not been determined.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $19 billion through False Claims Act cases, with more than $13.4 billion of that amount recovered in cases involving fraud against federal health care programs.

The civil settlement was handled by the U.S. Attorney’s Office for the Eastern District of Pennsylvania and the Civil Division’s Commercial Litigation Branch. The criminal case was handled by the U.S. Attorney’s Office for the Northern District of New York and the Civil Division’s Consumer Protection Branch. These matters were investigated by the Federal Bureau of Investigation, the Food and Drug Administration Office of Criminal Investigation, the Department of Health and Human Services Office of Inspector General Office of Investigations, the Defense Criminal Investigative Service of the Department of Defense, the U.S. Postal Service Office of Inspector General and the Office of Personnel Management Office of Inspector General with assistance from the Department of Health and Human Services Office of Counsel to the Inspector General and Office of General Counsel and Center for Medicare and Medicaid Services, the Food and Drug Administration’s Office of Chief Counsel and the National Association of Medicaid Fraud Control Units.

This Press Release is courtesy of www.justice.gov

Dear Compatriots!

Ukraine has just lived through the most glorious and the most tragic moments in its modern history. We have impressed the whole world with our powerful peaceful actions for the protection of our rights and freedoms and our own European choice. In this fight we have stuck together and became stronger as a modern political nation. But we have paid an extremely high price for the victory over dictatorship. Instead of listening to and considering legitimate and fair requirements of the society, the criminal and bloody regime of Yanukovych was brutally and cold-bloodedly killing and crippling civilians. According to the official and shocking data of the Ministry of Health Care, at least 88 have died. Let us honor their bright memory with a nation-wide minute’s silence.

The unseen cruelty and atrocity of the dictatorship regime did not stop the citizens. They have selflessly protected their rights and won at the expense of their lives. The bloody regime has fallen due to courage, heroism and self-sacrifice of the Maydan heroes.

In view of the Yanukovych’s escape from the capital and the fact that he has actually withdrawn himself from performing the constitutional powers, the Verkhovna Rada of Ukraine has assumed full responsibility for the situation in the country; dismissed Yanukovych from office; and set early elections of the President of Ukraine for May, 25, 2014.
Thereat, with the constitutional majority of votes, the Parliament has resumed the Constitution in the version of 2004 that was illegally abolished by Yanukovych in 2010. We have limited the dictatorship powers of the Head of the state and returned to the parliamentary-presidential republic. On this basis, the new parliamentary majority that will form the new Government of Ukraine will be established in the nearest days. Until that time, the Verkhovna Rada has mandated me, as its Chairman, to coordinate the work of the Cabinet of Ministers in the condition when the significant majority of government officials have vanished.

The Constitution in the renewed version of 2004 stipulates that under the absence of the President his duties shall be performed by the Chairman of the Verkhovna Rada. Under present circumstances, this is necessary for resuming functioning of the executive power and holding fair and transparent elections of the President.

In order to secure order, the Verkhovna Rada has appointed the acting Minister of Internal Affairs and authorized persons over the activity of the Prosecutor’s Office, the Defence Ministry and the Security Service. It means that the powers of structure no longer threaten life, health and safety of the citizens of Ukraine.
Our primarily task for today is to stop confrontation, resume control and order in the country; bring special units and internal forces to the places of their temporary deployment; guarantee peace and calm; prevent new victims, local confrontation and mob punishment. We have to toughly resist any manifestations of separatism and attacks on the territorial integrity of Ukraine.

There is no sense in telling about the situation in the economy – you can feel it with your own pockets. It is difficult to call things left by Yanukovych and Azarov even a ruin. On the background of recovery in the global economy, the Ukrainian one goes down the drain and is in the pre-default condition. Recovery of economy is the mission of a new governmental team that will be finally formed after the presidential elections. The task of a new Government is to stop county’s sliding into the abyss; stabilize exchange rate; guarantee timely payment of salaries, pensions, scholarships; return the trust of investors; promote development of enterprises; and create new workplaces.
Our another priority lies in returning to the course of European integration. This is where Maydan has begun. We have to return to the family of European countries.

We realize the importance of relations with the Russian Federation and we are ready for a dialogue with Russian leadership in order to build relations with this county on a new, really equal and neighborhood basis that recognizes and considers the European choice of Ukraine.

I hope that this is the choice that will be upheld during the presidential elections on May 25, 2014. We guarantee: these elections will fully correspond to the highest European standards. They will be free and fair. Everyone will have the right to freely make his/her choice and elect a decent, at his/her opinion, President of Ukraine.

I would like to separately address those compatriots who voted for Yanukovych during the elections, those who have become disillusioned, and those who still remain his sympathizers. Do not consider his as your personal failure that ended with a bloody drama, as your defeat! He has first of all betrayed you, those who believed in his “better life already today”. I hope that the majority of you have already seen the television images of Mezhyhirya, which is open now, and have realized what for this person has needed the post of a president. I believe that you will find a decent candidacy during free and democratic elections, and we will do everything possible to guarantee and protect your choice.

I would like to repeat what I have said during my election: I did not strife for these posts and powers and after the executive power is resumed I am ready to resign immediately. As the Chairman of the Verkhovna Rada I will do my best to preserve order, peace, harmony in Ukraine in order to return our country to the democratic an European way of development.

Glory to Ukraine! Glory to heroes!

This Press Release is courtesy of http://rada.gov.ua/en/news/top_news/88093.html

The Justice Department announced the filing of a lawsuit today against the State of Rhode Island and the Rhode Island Department of Corrections (RIDOC) alleging that the defendants are engaged in a pattern or practice of employment discrimination against African-Americans and Hispanics in violation of Title VII of the Civil Rights Act of 1964 (Title VII). Specifically, the lawsuit challenges the defendants’ use of a written examination and a video examination to screen and select applicants for entry-level correction officer (CO) positions at RIDOC as part of the department’s ongoing efforts to ensure that state and local government employers utilize non-discriminatory assessment tools in their hiring practices.

The complaint, filed in the U.S. District Court for the District of Rhode Island, alleges that the defendants require applicants for entry-level CO positions at RIDOC to undertake a multi-step selection process that includes, among other things, a written examination and a video examination taken on the same day. The complaint further alleges that the manner in which the defendants use the written and video examinations as part of their multi-step selection process disproportionately screens out African-American and Hispanic applicants, resulting in an unjustified disparate impact against these applicants.

Title VII not only prohibits intentional discrimination on the basis of race, color, sex, national origin and religion, but also prohibits employment practices that result in a disparate impact upon a protected group, unless the employer can prove that such practices validly predict an applicant’s ability to perform a job or there is a less discriminatory alternative that the employer can use. The department’s complaint states that the manner in which the defendants use the written and video examinations violates Title VII because such use is not “job related or consistent with business necessity,” as the law requires, and does not validly enable the employer to identify those applicants who are qualified for entry-level CO positions at RIDOC.

The department shares the goal of enabling public employers to hire qualified applicants to perform their critical public safety functions. In light of its findings and this shared goal, the department is seeking a court order requiring the defendants to stop using the challenged written and video examinations, develop selection procedures for entry-level CO positions at RIDOC that comply with Title VII and provide make-whole relief including, where appropriate, offers of hire, back pay and retroactive seniority, to African-Americans and Hispanics who have been or will be harmed as a result of the defendants’ use of the challenged examinations.

“Bringing an end to practices that have an unjustified discriminatory impact on the basis of race or national origin is a major priority of the Department of Justice,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “Employers must be able to show that examinations like those at issue here, that disproportionately screen out large numbers of African-American and Hispanic applicants, validly distinguish between qualified and unqualified applicants for the job. Otherwise, the examinations will not serve the employer’s purposes and will violate the law.”

This Press Release is courtesy of www.justice.gov