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List Blocks People From Flying Without Explanation Or Due Process

The American Civil Liberties Union today filed a first-of-its-kind lawsuit on behalf of 10 U.S. citizens and lawful residents who are prohibited from flying to or from the United States or over U.S. airspace because they are on the government's "No Fly List." None of the individuals in the lawsuit, including a disabled U.S. Marine Corps veteran stranded in Egypt and a U.S. Army veteran stuck in Colombia, have been told why they are on the list or given a chance to clear their names.

"More and more Americans who have done nothing wrong find themselves unable to fly, and in some cases unable to return to the U.S., without any explanation whatsoever from the government," said Ben Wizner, staff attorney with the ACLU National Security Project. "A secret list that deprives people of the right to fly and places them into effective exile without any opportunity to object is both un-American and unconstitutional."

The ACLU, along with its affiliates in Oregon, Southern California, Northern California and New Mexico, filed the lawsuit against the U.S. Department of Justice, the FBI and the Terrorist Screening Center in U.S. District Court for the District of Oregon. The plaintiffs on the case are:

• Ayman Latif, a U.S. citizen and disabled Marine veteran living in Egypt who has been barred from flying to the United States and, as a result, cannot take a required Veterans' Administration disability evaluation;
• Raymond Earl Knaeble, a U.S. citizen and U.S. Army veteran who is stuck in Santa Marta, Colombia after being denied boarding on a flight to the United States;
• Steven Washburn, a U.S. citizen and U.S. Air Force veteran who was prevented from flying from Europe to the United States or Mexico; he eventually flew to Brazil, from there to Peru, and from there to Mexico, where he was detained and finally escorted across the border by U.S. and Mexican officials;
• Samir Mohamed Ahmed Mohamed, Abdullatif Muthanna, Nagib Ali Ghaleb and Saleh A. Omar, three American citizens and a lawful permanent resident of the United States who were prevented from flying home to the U.S. after visiting family members in Yemen;
• Mohamed Sheikh Abdirahman Kariye, a U.S. citizen and resident of Portland, Oregon who was prevented from flying to visit his daughter who is in high school in Dubai;
• Adama Bah, a citizen of Guinea who was granted political asylum in the United States, where she has lived since she was two, who was barred from flying from New York to Chicago for work; and
• Halime Sat, a German citizen and lawful permanent resident of the United States who lives in California with her U.S.-citizen husband who was barred from flying from Long Beach, California to Oakland to attend a conference and has since had to cancel plane travel to participate in educational programs and her family reunion in Germany.

According to the ACLU's legal complaint, thousands of people have been added to the "No Fly List" and barred from commercial air travel without any opportunity to learn about or refute the basis for their inclusion on the list. The result is a vast and growing list of individuals who, on the basis of error or innuendo, have been deemed too dangerous to fly but who are too harmless to arrest.

"Without a reasonable way for people to challenge their inclusion on the list, there's no way to keep innocent people off it," said Nusrat Choudhury, a staff attorney with the ACLU National Security Project. "The government's decision to prevent people from flying without giving them a chance to defend themselves has a huge impact on people's lives - including their ability to perform their jobs, see their families and, in the case of U.S. citizens, to return home to the United States from abroad."

In addition to Wizner and Choudhury, attorneys on the case are Kevin Diaz and cooperating attorney Steven Wilker with the ACLU of Oregon; Ahilan Arulanantham, Jennie Pasquarella and cooperating attorney Reem Salahi with the ACLU of Southern California; Alan Schlosser and Julia Harumi Mass of the ACLU of Northern California; and Laura Ives of the ACLU of New Mexico. The Council on American-Islamic Relations consulted with Raymond Knaeble and directed him to the ACLU.

The ACLU's complaint is available online at: www.aclu.org/national-security/latif-et-al-v-holder-et-al-complaint.  More information about the ACLU's lawsuit is available online at: www.aclu.org/national-security/aclu-challenges-government-no-fly-list-0.

Detroit-area resident Emma King pleaded guilty today to engaging in a fraudulent medical testing scheme, announced the Departments of Justice and Health and Human Services (HHS).

King, 61, pleaded guilty today to one count of conspiracy to commit health care fraud before U.S. District Court Judge Patrick J. Duggan in the Eastern District of Michigan.  King faces a maximum penalty of 10 years in prison and a $250,000 fine.  A sentencing date has not yet been scheduled.

According to the plea documents, beginning in approximately September 2007, King began recruiting and transporting patients to a clinic called Ritecare LLC.  Ritecare, was owned and operated by co-conspirators and had locations in Detroit and Livonia, Mich.  King admitted that she and a co-conspirator paid kickbacks to Medicare beneficiaries that she recruited and transported to Ritecare.  According to the plea documents, the owners and operators of Ritecare were the source of the funds used by King to pay the Medicare beneficiaries she recruited.  King admitted that she would keep part of the funds she received from the owners and operators of Ritecare to secure patients as a kickback for referring the Medicare beneficiaries she recruited.  Typically, the owners of Ritecare would provide $100-$150 per patient King recruited, with King retaining $50-$75 of that amount for the referral.  

According to the plea documents, the patients King recruited had to subject themselves to medically unnecessary tests to receive the money.  Per instructions from the owners and operators of Ritecare, King admitted that she instructed the patients to claim they had certain symptoms to trigger medically unnecessary tests.  Consequently, the patients' medical records contained false symptoms allowing Ritecare to deceive Medicare as to the legitimacy and medical necessity of the tests it performed.  

King admitted that she was responsible for recruiting at least 269 patients to Ritecare.  Through her recruitment efforts, King caused the submission of approximately $940,760 in false or fraudulent billings by Ritecare.  Medicare paid approximately $533,643 on those claims.

Today's guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI's Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General's (OIG) Chicago Regional Office.

The case was prosecuted by Senior Trial Attorney John K. Neal and Trial Attorney Gejaa T. Gobena of the Criminal Division's Fraud Section.  The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division's Fraud Section and the U.S. Attorney's Office for the Eastern District of Michigan.  

Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 500 individuals who collectively have falsely billed the Medicare program for approximately $1.1 billion.  In addition, HHS's Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.

SOURCE U.S. Department of Justice

No on 17 intentionally trying to mislead voters. 'Parade of Horribles' Listed by Opponents in their Ballot Statements are Result of Current Auto Insurance Regulations, Not Prop. 17

Yes on 17, Californians for Fair Auto Insurance Rates, a coalition of consumers, businesses, senior organizations, taxpayer advocates and insurers, filed a lawsuit today in Sacramento Superior Court to force Proposition 17 opponents to make changes to their ballot arguments and ballot rebuttals and correct the patently false and misleading statements contained therein.

Proposition 17 on the June 8, 2010, California statewide ballot simply makes an existing persistency or "continuous coverage" discount portable, allowing customers to take it with them if they change insurance companies. Prop. 17 will mean more competition and choice in the auto insurance marketplace and will result in lower rates for drivers.

Prop 17 does not create a new discount. Thus any reductions in premiums or increases for those who are uninsured and do not maintain coverage are the result of current auto insurance regulations, not Prop 17.

Despite this, opponents of Prop 17 are intentionally misleading voters by repeatedly stating Proposition 17 creates new penalties. Statements to this effect appear throughout opponents' ballot arguments and rebuttals and are false and misleading. The "parade of horribles" cited in No on 17's ballot arguments are, in fact, already happening today, and exist under current regulations.

Ballot arguments and rebuttals appear in the Official Voter Information Guide compiled by the California Secretary of State and are distributed to every voter in California. Election law (Elec. Code Section 9092, Gov. Code  Section 88006) states that information in the voter guide must not contain "false and misleading" statements.

Opponents' ballot arguments and ballot rebuttals are available on the Secretary of State's website at www.sos.ca.gov.

"Proposition 17 simply allows responsible drivers who already qualify for a continuous coverage discount to take that discount with them if they change insurance companies. It does not create a new discount," said Kirk West, former president of the California Chamber of Commerce and co-chair of Californians for Fair Insurance rates (Cal-FAIR). 

West continued: "Throughout this campaign, opponents have misled and attempted to confuse voters. Their ballot arguments and rebuttals are more of the same statements. As authors of Proposition 103, they understand that the so-called "penalties" they speak of are attributable to current law and not to Prop. 17. Yet they are hiding behind false and misleading statements because they are afraid to acknowledge taking an anti-consumer position on Prop. 17 by opposing a measure that will result in more competition and more choice for more than 80% of California drivers who would benefit under Prop. 17."

Today, more than 80% of drivers maintain auto insurance and qualify for the persistency or continuous coverage discount, but can only get that discount from their current insurer. Thus, if a driver wants to switch to a new insurance company, he or she loses the discount and has to pay more.

Opponents' primary allegation against Prop. 17, made in a variety of ways in the ballot arguments and rebuttals, is that if Prop. 17 is passed and the continuous coverage discount is made portable, drivers seeking insurance who do not continuously maintain insurance coverage will pay more.

In fact, because the persistency or continuous coverage discount is being offered today, drivers who do not maintain continuous insurance coverage are today paying more to offset price reductions for those who do get the discount.

In other words, any reductions in premiums for drivers who qualify for the persistency discount, or the increase in premium for those who do not maintain continuous coverage, are products of existing regulations - not Proposition 17. 

Moreover, Proposition 17 adds new provisions to existing law that require insurers to offer the persistency discount even after lapses of coverage for up to 90 days for any reason other than nonpayment and for military service overseas; and Proposition 17 expressly does not limit an insurer's ability to offer additional grace periods for lapses. Current law offers none of these protections. As a result, repeated statements in the ballot arguments by opponents that Proposition 17 will increase rates for motorists are false and misleading. Any such increases are the result of existing law, not Proposition 17.

March 15, 2010, is the statutory deadline by which all June 2010 ballot argument challenges must be resolved. Prior to the deadline, Yes on 17 and No on 17 will meet in Sacramento Superior Court for oral argument in front of the judge assigned to this case. Since the suit was filed today no court date or judge has been assigned. There will be no ruling prior to oral argument. In past cases, the presiding judge has ruled from the bench immediately after oral arguments.

Background on ballot arguments and rebuttals in California

In ballot proposition campaigns in California, both the Yes side and No campaigns submit ballot arguments and ballot rebuttals for publication in the Official Voter Information Guide prepared by the California Secretary of State's Office.

Ballot arguments are submitted first. The Secretary of State then exchanges the arguments so each side can prepare a rebuttal to the main arguments for and against the proposition.

Rebuttals are in turn submitted, and then made available for public review along with the rest of the Official Voter Information Guide.

Proponents and opponents review ballot arguments and rebuttals and decide if they meet the California standard. If they do not meet the standard and contain false and misleading statements, lawsuits are permitted to ensure voters are not misled.

Ballot argument/rebuttal submission and litigation takes place months in advance of Election Day to allow time for potential litigation, printing and mailing the Voter Guide.

SOURCE Californians for Fair Auto Insurance Rates

Judge Rules Chicago Transit Authority Cannot Ban Computer and Video Game Ads

The United States District Court for the Northern District of Illinois granted the Entertainment Software Association (ESA) a preliminary injunction in its suit against the Chicago Transit Authority (CTA), the ESA said today. The case, which the ESA filed in July 2009, challenges CTA's prohibition of certain computer and video game advertisements as a violation of the guarantees of free speech under the First Amendment to the United States Constitution. In her opinion, Judge Rebecca R. Pallmeyer stated, "...the advertisements the CTA wishes to ban promote expression that has constitutional value and implicates core First Amendment concerns."

"This ruling is a win for Chicago's citizens, the video game industry and, above all, the First Amendment," said Michael D. Gallagher, president and CEO of the ESA, which represents U.S. computer and video game publishers. "It is our hope that the CTA sees the futility of pursuing this case further. To do so will waste taxpayer money and government resources. Chicago deserves better and we look forward to bringing this matter to an end."

ESA argued that CTA's Ordinance 008-147, which took effect in January 2009, unfairly targeted the entertainment software industry by prohibiting any advertisement that "markets or identifies a video or computer game rated 'Mature 17+' (M) or 'Adults Only 18+' (AO)." The ESA further contended the ordinance unconstitutionally "restricts speech in a public forum that is otherwise open to all speakers without a compelling interest for doing so." In addition, the ESA's complaint stated that the ordinance impermissibly discriminates on the basis of viewpoint and ignores less restrictive means of achieving the supposed ends of the ordinance. The court ruled that the ESA was likely to succeed on the merits of these claims at trial and, therefore, blocked enforcement of the ordinance until the case could be finally resolved.

The ESA also contended that the CTA's ordinance is unnecessary because game-related marketing is already subject to the Entertainment Software Rating Board's Advertising Review Council, which strictly regulates computer and video game advertisements that are seen by the general public. The Entertainment Software Rating Board assigns computer and video games ratings and content descriptors, which are both displayed on advertisements for those games.

The Entertainment Software Association is the U.S. association dedicated to serving the business and public affairs needs of companies publishing interactive games for video game consoles, handheld devices, personal computers, and the Internet. The ESA offers services to interactive entertainment software publishers including a global anti-piracy program, owning the E3 Expo, business and consumer research, federal and state government relations, First Amendment and intellectual property protection efforts. 

Captain Michael Dung Nguyen, 28, of Ft. Lewis, Wash., pleaded guilty today before U.S. District Court Judge Ancer L. Haggerty to the crimes of theft of government property and structuring financial transactions. Nguyen is scheduled for sentencing on March 1, 2010 at 9:30 a.m.

In pleading guilty to the offenses, Nguyen admitted that while on deployment to Iraq, he stole and converted to his own use approximately $690,000 in U.S. currency.

Nguyen gained access to the currency in his capacity as the Project Purchasing Officer in the 1st Battalion, 23rd Infantry Regiment of the U.S. Army. The currency was derived from Commander's Emergency Response Program (CERP) funds. CERP funds are the property of the United States and are managed by the Department of Defense. The currency was intended as payment for security contracts with the Sons of Iraq as well as humanitarian relief and reconstruction programs.

Nguyen transported the stolen currency into the District of Oregon by mailing it to himself at his family's Oregon residence prior to his return from Iraq. Shortly after he returned from Iraq, Nguyen opened new bank accounts at Bank of America, Washington Mutual Bank, America's Credit Union and Heritage Bank, and proceeded to deposit $387,550 of the stolen CERP currency into those accounts in Oregon and elsewhere. Between June 9, 2008 and Sept. 26, 2008, Nguyen made repeated deposits of stolen currency in a manner that was intended to evade federal reporting requirements for the deposit of large amounts of money.

After depositing the money in the accounts, Nguyen purchased a 2008 BMW and a 2009 Hummer H3T, in addition to purchasing computers, firearms, electronics and furniture. During the execution of a search warrant, investigators discovered over $300,000 in stolen CERP currency hidden in the attic of Nguyen's Portland family home.

At sentencing, the maximum penalty for each of the crimes of conviction is ten years in prison and a maximum fine of $500,000. In addition to pleading guilty, Nguyen agreed to forfeit all the stolen currency, as well as all of the personal property purchased with the stolen funds.

The investigation was initiated by the Portland office of the Internal Revenue Service, Criminal Investigation, following the discovery of large and frequent currency deposits and substantial expenditures above Captain Nguyen's legitimate income level. The investigation was joined by the FBI, the U.S. Army Criminal Investigation Division's Major Procurement Fraud Unit, and the Department of Defense's Criminal Investigative Service. The case is being prosecuted by Assistant U.S. Attorney Scott Erik Asphaug.

A former State Department employee was sentenced today to 12 months of probation for illegally accessing more than 75 confidential passport application files, Assistant Attorney General Lanny A. Breuer of the Criminal Division announced. William A. Celey, 28, of Washington, was also ordered to perform 50 hours of community service by U.S. Magistrate Judge Deborah A. Robinson in the District of Columbia. On July 10, 2009, Celey pleaded guilty to a one-count criminal information charging him with unauthorized computer access.

According to court documents, from August 2003 through July 2004, Celey worked as a contract employee for the State Department as a file assistant. According to plea documents, Celey admitted he had access to official State Department computer databases in the regular course of his employment, including the Passport Information Electronic Records System (PIERS), which contains all imaged passport applications dating back to 1994. The imaged passport applications on PIERS contain, among other things, a photograph of the passport applicant as well as certain personal information including the applicant's full name, date and place of birth, current address, telephone numbers, parent information, spouse's name and emergency contact information. These confidential files are protected by the Privacy Act of 1974, and access by State Department employees is strictly limited to official government duties.

In pleading guilty, Celey admitted that between June 22, 2004, and July 15, 2004, he logged onto the PIERS database and viewed the passport applications of more than 75 celebrities and their families, actors, models, musicians, athletes, record producers, family members, a politician and other individuals identified in the press. Celey admitted that he had no official government reason to access and view these passport applications, but that his sole purpose in accessing and viewing these passport applications was idle curiosity.

Celey is the sixth current or former State Department employee to plead guilty in this continuing investigation. On Sept. 22, 2008, Lawrence C. Yontz, a former Foreign Service Officer and intelligence analyst, pleaded guilty to unlawfully accessing nearly 200 confidential passport files. Yontz was sentenced on Dec. 19, 2008, to 12 months of probation and ordered to perform 50 hours of community service. On Jan. 14, 2009, Dwayne F. Cross, a former administrative assistant and contract specialist, pleaded guilty to unlawfully accessing more than 150 confidential passport files. On March 23, 2009, Cross was sentenced to 12 months of probation and ordered to perform 100 hours of community service. On Jan. 27, 2009, Gerald R. Lueders, a former Foreign Service Officer, watch officer and recruitment coordinator, pleaded guilty to unlawfully accessing more than 50 confidential passport files. Lueders was sentenced on July 8, 2009, to 12 months of probation and ordered to pay a $5,000 fine. On Aug. 17, 2009, Kevin M. Young, a contact representative, pleaded guilty to unlawfully accessing more than 125 confidential passport files. Young is scheduled to be sentenced on Dec. 9, 2009. On Aug. 26, 2009, Karak Busch, a former citizens services specialist, pleaded guilty to unlawfully accessing more than 65 confidential passport files. Busch is scheduled to be sentenced on Dec. 15, 2009.

These cases are being prosecuted by Trial Attorney Armando O. Bonilla of the Criminal Division's Public Integrity Section, headed by Section Chief William M. Welch II. The cases are being investigated by the State Department Office of Inspector General.

SOURCE U.S. Department of Justice

A lawsuit was filed in the U.S. District Court for the Northern District of Mississippi today challenging the constitutionality of the current size of the United States House of Representatives. The lawsuit argues that the provision in the United States Code (2 USC section 2a) that freezes the size of the House at 435 members is unconstitutional, egregiously violating the well-established principle of "one person, one vote" affirmed in multiple Supreme Court decisions. At the state level, the implication of "one person, one vote" means that each state must ensure a population variance of less than 1% across all its federal congressional districts so that voter equality is strictly maintained. At the national level, however, this principle has not been applied, and the population variance between the most under-represented congressional district and most over-represented district exceeds 80%. Fortunately, the current disparity and resulting inequity can be remedied by simply adding more members to the House of Representatives.

The five plaintiffs in the case each represent the five most under-represented states and include: Lisa Schea from Delaware, John Tyler Clemons from Mississippi, Jessica Wagner from Montana, Krystal Brunner from South Dakota and Frank Mylar from Utah. Not only do these five plaintiffs suffer from unconstitutionally diminished voting power, but so do all other qualified and registered voters throughout these states. The five most over-represented states are: Iowa, Nebraska, Rhode Island, West Virginia and Wyoming. "Our Constitution was crafted around the idea that all citizens deserve an equal voice in the decisions of their government," Clemons said. "If someone's vote in Iowa or Wyoming counts for more than mine, how is that equality?"

Apportionment.US, Inc. is the non-profit organization coordinating the lawsuit on behalf of the plaintiffs. "The foundation of our constitutional form of government in America is defined by 'We the People,' which demands equal representation across our entire Republic," said Scott Scharpen, founder and president of Apportionment.US. He added, "Whether you are a Democrat, Republican or Independent, working to achieve equal representation is the ultimate non-partisan, grassroots effort that is worthy of support from all Americans."

Despite the U.S. population more than tripling in the last 100 years (from less than 100 million to over 300 million people), the number of House representatives over the same time has remained identical at 435 members. Why has this inequity in voting rights and representation never been formally corrected or challenged? Scharpen answered, "It's not clear. While many scholars and political analysts have raised these important issues, this lawsuit is the first of its kind seeking to correct the inequity, which clearly violates the Framers' intent. We are committed to correcting the injustice perpetrated on the residents of these five states, but we are also working to ensure that both current and future generations of Americans across the land have a representative form of government that maintains structural equality for all."

If this lawsuit is successful, the court will require an increase in House membership to achieve appropriate voter equality across America, and bring about perhaps the most significant change in the federal government structure in nearly a century.

SOURCE Apportionment.US

The Office of the President and other White House officials are defendants in a free speech lawsuit filed by a prominent physician group, and a non-profit advocate for inner-city poor.

The White House has "unlawfully collected information on political speech," thereby illegally using the power of the White House to chill opposition to its plans for health care reform, according to the complaint filed in District Court for the District of Columbia, by the Association of American Physicians and Surgeons (AAPS) and the Coalition for Urban Renewal and Education (CURE)

The lawsuit was prompted by the White House solicitation for the public to report any "fishy" comments to 'flag@whitehouse.gov.' Although the White House slightly revised its data collection procedure last week, the email address still exists, the illegal activity continues, and is part of an "unlawful pattern and practice to collect and maintain information" on the exercise of free speech, which "continues in violation of the Privacy Act and First Amendment even if the Defendants terminate a particular information-collection component due to negative publicity."

The lawsuit outlines how the White House has employed a form of "bait-and-switch" tactic of accusing the Plaintiffs and other opponents of spreading misinformation about the Administration's goals for health care reform, and thereby refusing to 'come clean' about its real agenda.

The lawsuit outlines that the White House knew that the data collection would chill free speech, and in fact, intended to do just that:

        "43.  As part of their effort to advance the White House healthcare
        reform agenda, Defendants have accused opponents (including
        Plaintiffs) of spreading misinformation on issues such as whether
        (a) health reform would provide public funding for abortions, (b) put
        "death panels" in place to deny care to the elderly or infirm,
        (c) amount to a government takeover of healthcare, and (d) increase
        healthcare costs..the Defendants and the administration have spread
        misinformation, semantics, and disinformation on these topics.....

        "45.  By denying and continuing to deny that healthcare reform
        legislation includes "death panels" that make individual life-or-death
        decisions on the elderly or infirm, the Defendants and the current
        administration have ignored and implicitly denied and continue to
        ignore and implicitly to deny both that their healthcare reform agenda
        involves rationing healthcare..."

"My hate mail started shortly after the White House issued the 'fishy' request," said Kathryn Serkes, Director of Policy and Public Affairs for AAPS. "We were quite visible and vocal before then, so it doesn't seem like a coincidence. Who did they share their data with? With whom might they share it?"

AAPS and CURE demand that the White House remove all information already collected, and further, be prohibited from collecting any personal data in the future.

SOURCE Association of American Physicians and Surgeons (AAPS)

Lee William Dubois, a former Department of Defense (DoD) contractor, was sentenced today to three years in prison for his participation in a scheme to steal fuel worth approximately $39.6 million from the U.S. Army in Iraq, announced Assistant Attorney General of the Criminal Division Lanny A. Breuer and U.S. Attorney for the Eastern District of Virginia Dana J. Boente.

Dubois, 32, of Lexington, S.C., was sentenced today by U.S. District Court Judge Gerald Bruce Lee in the Eastern District of Virginia. Dubois had pleaded guilty to a one-count information charging him with theft of government property on Oct. 7, 2008. In connection with his plea, Dubois testified at the trial of his co-conspirator, Robert Jeffery, who was convicted by a jury on Aug. 11, 2009. Dubois also repaid to the U.S. government $450,000 that represented the illicit proceeds of the scheme.

In his plea, Dubois admitted that between July 2007 and May 2008, he and his co-conspirators, purportedly representing DoD contractors in Iraq, used fraudulently-obtained documents to enter the Victory Bulk Fuel Point (VBFP) in Camp Liberty, Iraq, and presented false fuel authorization forms to steal aviation and diesel fuel from the VBFP for subsequent sale on the black market. According to plea documents, the United States owns and operates the VBFP in support of Operation Iraqi Freedom. The VBFP supplies aviation and diesel fuel to both military units and U.S. government contractors operating in and around the VBFP. To retrieve and transport the stolen fuel from the VBFP, Dubois admitted he and his co-conspirators employed approximately 10 individuals to serve as drivers and escorts of the trucks containing the stolen fuel. These individuals were able to enter the VBFP illegally by using government-issued common access cards.

Dubois admitted he obtained the cards by falsely representing to the U.S. Army that the drivers and escorts were employees of a DoD contractor, when, in fact, they were not employed by any government contractors. In addition, Dubois admitted he went to the VBFP and presented false documents authorizing his co-conspirators to draw fuel. Dubois also admitted that for two months during the scheme, he served as the lead escort for the stolen fuel. According to information contained in the plea documents, during the course of the scheme, Dubois and his co-conspirators stole approximately 10 million gallons of fuel worth approximately $39.6 million. Dubois received at least $450,000 in personal profits from the subsequent sale of the fuel on the black market.

In related cases, Robert Jeffery was convicted on Aug. 11, 2009, after a two-day jury trial, of one count of conspiracy and one count of theft of government property for his role in the fuel theft. Robert Young and Michel Jamil each pleaded guilty to participating in the same scheme. The evidence at trial showed that Jeffery served as an escort for the fuel trucks and retrieved hundreds of thousands of gallons of fuel from the VBFP. Sentencing for Jeffery is scheduled for December 11, 2009.

Young, 56, a former captain in the U.S. Army, pleaded guilty on July 24, 2009. In his guilty plea, Young admitted that between October 2007 and May 2008, he and his co-conspirators used fraudulently-obtained documents to enter the VBFP and presented false fuel authorization forms to steal aviation and diesel fuel from the VBFP for subsequent sale on the black market. As a result of the scheme, Young received approximately $1 million in personal profits. Sentencing for Young is scheduled for Oct. 30, 2009.

Jamil, 59, pleaded guilty on July 27, 2009, with his role in the scheme. Jamil admitted that in March 2007, he and two of his co-conspirators arranged for the creation of a false Memorandum for Record (MFR) authorizing individuals to draw fuel from VBFP, purportedly on behalf of a company serving as a contractor to the U.S. government. Jamil admitted that he and his co-conspirators used this false MFR and others to steal large quantities of fuel from the U.S. Army for subsequent sale on the Iraqi black market. As a result of the scheme, Jamil admitted he received between $75,000 and $87,500 in profits. Sentencing is scheduled for Nov. 13, 2009.

The case is being prosecuted by Special Assistant U.S. Attorney Steve Linick, Deputy Chief of the Criminal Division's Fraud Section, and Fraud Section Trial Attorneys Andrew Gentin and Brigham Cannon. The investigation of this case was conducted by the U.S. Army Criminal Investigation Command, the Defense Criminal Investigative Service, the Washington Field Office of the FBI and members of the National Procurement Fraud Task Force and the International Contract Corruption Task Force (ICCTF).

The National Procurement Fraud Task Force, created in October 2006 by the Department of Justice, was designed to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in government contracting activity for national security and other government programs. The ICCTF is a joint law enforcement agency task force that seeks to detect, investigate and dismantle corruption and contract fraud resulting from U.S. Overseas Contingency Operations, including in Afghanistan, Iraq and Kuwait.

Source: US Dept. of Justice

Hansruedi Schumacher and Matthias Rickenbach, both of Switzerland, were indicted today for conspiring to defraud the United States, the Justice Department and Internal Revenue Service (IRS) announced. According to the indictment, Schumacher worked as an executive manager at Neue Zuercher Bank (NZB), a Swiss private bank located in Zurich, Switzerland. Rickenbach worked as a Swiss attorney who provided legal advice and services to U.S. clients. Both are alleged to have aided wealthy Americans conceal assets and income in Switzerland from United States authorities.

According to the indictment, Schumacher and Rickenbach helped wealthy American clients conceal their assets by establishing sham and nominee offshore entities to hide their U.S. clients' assets and income while allowing these clients to still control the assets and make investment decisions.

The indictment further alleges that Schumacher and Rickenbach regularly traveled to the United States to conduct banking and investment activities with their U.S. clients and that when they traveled they concealed their business activities in the United States by falsely representing to American authorities that they were traveling to the U.S. for personal reasons. While in the United States, the defendants would sometimes bring cash for their clients..

According to court documents, Schumacher and Rickenbach aided their wealthy American clients repatriate money back to the United States using several deceptive means. Schumacher and Rickenbach helped their clients obtain offshore credit cards and created sham loan documents. Additionally, Schumacher and Rickenbach falsified bank documents to generate the appearance that assets of their U.S. clients belonged to Swiss citizens, and they falsified documents to disguise their United States clients' repatriation of offshore funds as inheritances from foreign citizens.

According to court documents, Schumacher and Rickenbach discouraged their U.S. clients from voluntarily coming into compliance in the United States. Instead, the defendants encouraged their clients to transfer their assets from UBS, a large Swiss bank, to NZB, a smaller bank in Switzerland. The defendants told their clients that their assets and identification would be safer at NZB because they had no presence in the United States and was therefore less likely to be pressured by the American authorities to disclose the identities of their United States clients.

"The Justice Department will continue to investigate leads provided by U.S. taxpayers who have come forward to disclose foreign bank accounts and will prosecute those foreign bankers and banks who illegally helped U.S. clients evade taxes," said John A. DiCicco, Acting Assistant Attorney General of the Justice Department's Tax Division. "We encourage foreign banks to come forward and disclose their conduct immediately, before we learn about their criminal conduct from U.S. taxpayers."

"Today's Indictment is the latest prosecution in this District against foreign bankers and professionals who enabled and assisted wealthy Americans conceal their assets offshore," said Jeffrey H. Sloman, Acting U.S. Attorney for the Southern District of Florida. "As more Americans voluntarily come into compliance and face their financial obligations, more leads are being developed and new investigations are initiated. American taxpayers who sought to avoid taxes by hiding their assets in Swiss accounts are on notice that this investigation continues."

"This is another step in our ongoing effort to pursue hidden offshore assets -- no matter where they are located," said IRS Commissioner Doug Shulman. "We're in the early stages of our work to crack down on offshore tax evasion. Through our efforts, we are gaining access to more and more information on institutions and individuals involved in offshore tax evasion, and you can expect us to use all of our enforcement tools to stop this abuse. For people with hidden offshore assets, they have an opportunity to get right with the government. Time is quickly running out, and people should take advantage of our voluntary disclosure process before special provisions expire September 23."

Acting Assistant Attorney General DiCicco and Acting U.S. Attorney Sloman commended the investigative efforts of the IRS agents involved in this case. The prosecution is being handled by Senior Litigation Counsel Kevin M. Downing and Trial Attorney Michael P. Ben'Ary of the Tax Division, and Assistant U.S. Attorney Jeffrey A. Neiman.

U.S. citizens who have an interest in, or signature or other authority over, a financial account in a foreign country with assets in excess of $10,000 are required to disclose the existence of such account on Schedule B, Part III of their individual income tax return. Additionally, American citizens must file a Report of Foreign Bank and Financial Accounts, or F-Bar, with the U.S. Treasury, disclosing any financial account in a foreign country with assets in excess of $10,000 for which they have a financial interest in or signature authority, or other authority over.

Source: US Dept. of Justice

The U.S. Department of Labor has obtained a consent judgment and order requiring the former president of Chicago-based AA Capital Partners Inc. to restore $50 million in losses to five Michigan pension funds as restitution for misuse of the plans' assets to benefit the investment firm and himself. The judgment also bars defendant John Orecchio from serving in a fiduciary or service provider capacity to any employee benefit plan governed by the Employee Retirement Income Security Act (ERISA).

"Fiduciaries have a legal obligation to ensure plan assets are used only to pay benefits and reasonable expenses of a plan. Those who violate that trust will be held accountable for their actions," said Secretary of Labor Hilda L. Solis.

Although Orecchio has submitted proof of current inability to make restitution, the consent judgment requires him to submit annual financial statements to the Labor Department and to pay off the judgment as funds are received by him.

The Labor Department filed a lawsuit on April 10, 2008 against AA Capital Partners, its co-owner and president Orecchio, chief financial officer Mary Elizabeth Stevens, and affiliate AA Capital Liquidity Management, LLC for allegedly misusing plan assets and charging the plans excessive fees on investments. In July 2008, the department filed an amended complaint adding an additional count which alleged that plan assets were imprudently invested in a limited partnership created to invest in Xyience Inc., a Nevada corporation which manufactures and sells food, vitamins and beverages, even though a prudent investigation had not been conducted with respect to this investment strategy.

The pension plans that suffered losses as a result of Orecchio's actions covered more than 60,000 participants of the Carpenters Pension Trust Fund of Detroit and Vicinity, Operating Engineers Local No. 324 Pension Fund, Michigan Regional Council of Carpenters Annuity Fund, Millwrights' Local No. 1102 Supplemental Pension Fund, and Michigan Teamsters Joint Council #43 Pension Fund. As of April 30, 2006, the pension plans had total assets of approximately $3.1 billion.

At various times from 2002 to 2006, the defendants allegedly improperly used $25.9 million of the plans' assets to pay for, among other things, the operating expenses of the firm, renovations to a horse farm, and a strip club owned by Orecchio. In addition, they caused the plans to pay unauthorized fees to AA Capital.

AA Capital is a registered investment advisory firm to employee benefit plans, including ERISA-covered benefit plans. The firm created AA Capital Liquidity Management as the general partner for a fund that invested in real estate loans and entities that developed real property. In 2006, AA Capital was placed in the hands of a court-appointed receiver.

The Chicago Regional Office of the Labor Department's Employee Benefits Security Administration (EBSA) investigated this case. The suit was filed in federal district court in Chicago. Employers and workers can contact the Chicago office at 312-353-0900 or EBSA's toll-free number, 866-444-3272, for help with problems relating to private-sector health and pension plans.

Source: U.S. Department of Labor

Thirty-two people have been indicted for schemes to submit more than $16 million in false Medicare claims in the continuing operation of the Medicare Fraud Strike Force in Houston, Deputy Attorney General David W. Ogden and Deputy Secretary Bill Corr of the Department of Health and Human Services (HHS) announced today. The Strike Force in Houston is the fourth phase of a targeted criminal, civil and administrative effort against individuals and health care companies that fraudulently bill the Medicare program.

While the indictments were returned by a grand jury in Houston, individuals were arrested today in Houston, New York, Boston and Louisiana. In addition, Strike Force agents executed 12 search warrants at health care businesses and homes across the Houston area.

The joint DOJ-HHS Medicare Fraud Strike Force is a multi-agency team of federal, state and local investigators designed to combat Medicare fraud through the use of Medicare data analysis techniques and an increased focus on community policing. The fourth phase was announced in May 2009, with agents from FBI, HHS Office of the Inspector General (HHS-OIG), the Texas Attorney General's Medicaid Fraud Control Unit (MFCU), the Drug Enforcement Administration (DEA), Office of Personnel Management, Office of the Inspector General (OPM-OIG) and the Office of the Inspector General at the Railroad Retirement Board (RRB-OIG).

"Our Medicare Strike Force is striking back against health care fraud in all its forms and wherever it occurs. We will stop fraud as its happening, using real-time data analysis of Medicare billing records," said Deputy Attorney General David W. Ogden. "Those who commit health care fraud will not be allowed to steal money from American taxpayers. Anyone operating or considering operating a health care fraud scheme around the country should take notice that they will be held accountable."

"When criminals rip off Medicare beneficiaries, we all pay the price. These false Medicare schemes and scams are costing the taxpayers millions of dollars, harming Medicare beneficiaries and driving up the cost of health care, but thanks to this new innovative partnership and the hard work of our staff on the ground, we are starting to fight back against fraud in a big way. The Administration's HEAT initiative and our Strike Forces are making a big difference in a very short amount of time, returning millions back to the Medicare Trust in just a few months," said Bill Corr, Deputy Secretary of Health and Human Services and the top HHS official on the HEAT Team. "We are also working together across the federal government on important new innovations in the way we do business on the front end, to try and prevent crime like this from happening in the first place."

The Strike Force operations in Houston are another important step of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their joint efforts to reduce and prevent Medicare and Medicaid fraud through enhanced cooperation. The HEAT taskforce, co-chaired by Deputy Attorney Ogden and Deputy Secretary Corr, is made up of top-level law enforcement agents, prosecutors and staff from both Departments and their operating divisions. In the May 2009 announcement, Attorney General Eric Holder and Secretary Kathleen Sebelius announced the expansion of the Strike Force into Detroit and Houston to build upon existing partnerships between the agencies in a heightened effort to reduce fraud and recover taxpayer dollars.

Charges were unsealed today against 32 individuals who are accused of various Medicare fraud offenses, including conspiracy to defraud the Medicare program, and criminal false claims. The Strike Force operations in Houston have identified the primary fraud schemes as those related to false billing for "arthritis kits," power wheelchairs and enteral feeding supplies.

According to the indictments, the defendants charged today participated in schemes to submit claims to Medicare for products that were in fact medically unnecessary and oftentimes, never provided. In some cases, indictments allege that beneficiaries were deceased at the time they allegedly received the items. Collectively, the physicians, company owners and executives charged in the indictments are accused of conspiring to submit more than $16 million in false claims to the Medicare program.

"Americans deserve quality healthcare and have the right to expect that money expended on Medicare is not wasted," said U.S. Attorney Tim Johnson. "We will prosecute anyone who fraudulently obtains Medicare benefits at the expense of the truly needy."

"We will protect the Medicare program and its beneficiaries by stopping those who falsely bill for power wheelchairs, orthotic devices and other supplies that are not needed," said Daniel R. Levinson, Inspector General of the Department of Health & Human Services. "Today's arrests demonstrate the significant impact of the new HEAT strike force on combating fraud and abuse in the Houston area."

"We will continue to work together to combat those who corrupt the system and wish to line their pockets with taxpayer dollars," said Special Agent in Charge Richard C. Powers, FBI Houston Field Office. "Healthcare fraud strikes at the heart of our health care system and our economy."

Texas Attorney General Greg Abbott added: "Today's arrests reflect a concerted effort to crack down on those who defraud Texas taxpayers. We will continue working with our federal partners to uncover waste, fraud, and abuse in the Medicare and Medicaid systems."

Since the inception of Strike Force operations in March 2007 with phase one in South Florida, phase two in Los Angeles in May 2008, and phase three in Detroit in March 2009, the Strike Force has obtained indictments of more than 293 individuals and organizations that collectively have billed the Medicare program for more than $674 million. In addition, HHS's Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

Each of the three Houston Strike Force teams is led by a federal prosecutor from the U.S. Attorney's Office in Houston or the Criminal Division's Fraud Section. Each team has an agent from the FBI, HHS-OIG and the Texas Attorney General's MFCU. DEA, OPM-OIG and RRB-OIG also have agents on the teams.

The cases are being prosecuted by attorneys from the U.S. Attorney's Office, including Assistant U.S. Attorney Jennifer Lowery and Special Assistant U.S. Attorney Justin Blan, on detail from HHS-OIG, as well as from the Criminal Division's Fraud Section, including Assistant Chief John S. (Jay) Darden and Trial Attorneys Charles Reed, Katherine Houston, Anthony Burba and John Cunningham.

An indictment is merely an allegation, and defendants are presumed innocent until and unless proven guilty.

Source: U.S. Dept. of Justice

The following remarks were issued today by Attorney General Eric Holder:

Good morning and thank you for inviting me to join you today. It is a pleasure to be here among friends and colleagues, many of whom I've had the distinct pleasure of working with over the last 30 years during my time in the Department. There are too many familiar faces in the room to begin naming names, but as I have said many times in the last six months, it is great to be back.

These Leadership Conferences always present a great opportunity for us to learn from one another and for the Department to recognize your many significant accomplishments. This year's conference is even more special, as 2009 marks the 25th year of the Asset Forfeiture Program. I am very pleased to join you in this Silver Anniversary celebration, and I share your pride in the Asset Forfeiture Program's quarter-century of success.

I am also proud to be here today to honor the OCDETF Program, which is now in its 27th year. The OCDETF strategy recognizes that the most effective way to fight sophisticated criminal organizations is by leveraging the strengths, resources, and expertise of federal, state and local investigative and prosecutorial agencies. The OCDETF Program does this through the formation of prosecutor-led, multi-agency task forces that successfully target drug traffickers through cutting edge, intelligence-based analysis and investigative work.

Working together, the OCDETF and Asset Forfeiture Programs have a proven track record of destroying drug trafficking organizations by arresting and prosecuting their leadership and by seizing their financial infrastructure. I am delighted to be here today with the leaders of these great programs.

I'd like to begin by talking about OCDETF, which truly is the strategic centerpiece of the Department's counter-narcotics effort. When I served as United States Attorney, I was fortunate to lead the OCDETF effort here in Washington, DC, and experienced first-hand the field-level effectiveness of the Program. Later, as Deputy Attorney General, I saw just how powerful the OCDETF model could be on a nationwide basis. Now, as Attorney General, I am proud to support your continued success. Through your constant innovation and steadfast commitment to cooperation with our state and local partners, you have enhanced immeasurably our nation's counter-narcotics capabilities.

Two examples of OCDETF's innovative and cooperative approach demonstrate the effectiveness of the OCDETF strategy: (1) the establishment of the OCDETF Fusion Center; and (2) the creation of permanent, co-located OCDETF Strike Forces.

The OCDETF Fusion Center was established to address a pressing need for reliable, in-depth intelligence -- from both human and electronic sources -- to target and attack sophisticated international drug trafficking and money laundering organizations. Building on the OCDETF philosophy of cooperation and information-sharing, the Fusion Center brings together into a common database the unfiltered investigative information of each OCDETF member agency. Known as "Compass," this database allows analysts to connect investigative information from multiple agencies and to provide real-time analysis to agents and prosecutors in the field. The Fusion Center works in concert with the DEA-led Multi-Agency Special Operations Division to provide the most complete intelligence picture of criminal organizations currently available to U.S. law enforcement.

In recognition of the Fusion Center's effectiveness and the value of the Compass database, the International Organized Crime Intelligence and Operations Center -- or "IOC-2," as it is known -- recently entered into a partnership with the OCDETF Fusion Center. The IOC-2 will add important new data sources to the Compass database as well as new analysts into the OCDETF Fusion Center. Through this partnership, we will broaden our capability to attack organized crime in all its forms.

A second illustration of OCDETF's success is the creation of permanent, co-located OCDETF Strike Forces in Boston, New York, Atlanta, Tampa, San Juan, Houston, Phoenix, San Diego -- and soon in El Paso. Because they are both permanent and co-located, these strike forces foster close working relationships across agencies and facilitate multiple, wide-reaching, and highly effective multi-agency investigations. Moreover, these Strike Forces have taken innovative steps to leverage non-OCDETF resources to their great advantage. For example, working with the Asset Forfeiture Fund, OCDETF and the National Drug Intelligence Center have begun to place Document and Media Exploitation Teams in the Atlanta and Houston Strike Forces. These DOMEX teams allow Strike Force analysts and agents to capture and exploit evidence in complex, fast-paced investigations, and to develop trial exhibits for prosecutors quickly and effectively. We look forward to adding DOMEX teams to other co-located strike forces in the near future, beginning with those along the Southwest Border.

Collaborative and innovative efforts such as the OCDETF Fusion Center and the OCDETF Strike Forces are critically important if we are to succeed in our efforts to combat international drug traffickers and money launderers. The criminal organizations that OCDETF targets are as sophisticated as they are ruthless. Indeed, some of these groups have even aligned themselves with terrorist organizations. We have seen that Mexican drug cartels in particular, pose both a national security threat to Mexico and an organized crime threat to the United States. The cartels send seemingly endless supplies of cocaine, heroin, methamphetamine, marijuana and other illicit drugs across our borders and onto our streets. They operate seamlessly across local, state, and national boundaries. To combat this threat, we must also be seamless in our operations.

I know that all of you are up to the challenge. Since the inception of the Consolidated Priority Organization Target (or "CPOT") List in 2002, your OCDETF investigations have dismantled 39 CPOT organizations and have disrupted 20 more. Further, you have dismantled or disrupted more than 1,160 CPOT-linked organizations. The success of your operations is impressive, but not surprising. We can expect to achieve these kinds of results when we work together in innovative ways.

Together with OCDETF, the Asset Forfeiture Program has made, and continues to make, a critical difference in the fight against crime. Through your work, the Asset Forfeiture Program provides vitally important funding for law enforcement as well as resources that can be invested in community-changing programs such as "Weed and Seed." And of course, by seizing criminals' assets, you reduce the incentive to commit crime by taking money out of the hands of dangerous drug dealers and terrorists -- money that now works for law enforcement.

As with the OCDETF Program, the success of the Asset Forfeiture Program is a direct result of your hard work and your unfailing commitment to cooperation and collaboration at all levels and across all organizational lines. As Deputy Attorney General, it was my privilege to testify before Congress in support of asset forfeiture legislation. In that testimony, I emphasized the critical role that asset forfeiture plays not only in the fight against illegal drugs, but in the broader fight against other types of crime. Almost ten years to the day since that testimony -- and, appropriately, on the 25th anniversary of the Asset Forfeiture Program -- I am proud to say that the Asset Forfeiture Program remains a critical part of the Department's efforts to reduce and deter criminal activity.

Since 1984, more than $13 billion in net federal forfeiture proceeds have been deposited into the Justice Assets Forfeiture Fund. During this same period, more than $4.5 billion has been equitably shared with more than 8,000 state and local law enforcement agencies nationwide, thereby supplementing their constrained resources without further taxing the public. Once left with no real opportunity to recover their losses, crime victims are now recouping greater sums than ever before. Approximately $500 million in payments have been paid to more 39,000 victims in fiscal year 2008 alone.

Yet, the impact of forfeiture is greater than just money. When we look back on the last 25 years of the program, we see a forfeiture regime that has been transformed from a collection of centuries-old laws designed to fight pirates, enforce customs laws and fight illegal contraband, into an array of modern law enforcement tools designed to combat 21st century criminals both at home and abroad. We now have the ability to deprive global criminals of their ill-gotten gains, to seize the instrumentalities of their trade, and to use the power of asset forfeiture to destroy their illegal enterprises.

Operation Honor Student, a case that will be honored here later tonight, illustrates the power of asset forfeiture and its devastating effect on organized criminal activity. In that case, a task force led by the Rhode Island U.S. Attorney's Office, the Asset Forfeiture and Money Laundering Section of the Criminal Division, and the Food and Drug Administration's Office of Criminal Investigations obtained the forfeiture of $2.7 million from the accounts of GeneScience, one of the largest biopharmaceutical companies in China that had been involved in the illegal distribution of Human Growth Hormone into the United States. To accomplish this forfeiture, the task force employed a new statutory vehicle -- 18 U.S.C. section 981(k) -- which permitted the Government to seize the funds, physically located in China, from the corresponding accounts of Chinese banks in New York. This was the first use of section 981(k), enacted as part of the USA Patriot Act, against a Chinese entity, and its success has helped pave the way for subsequent investigations using this groundbreaking authority.

But not to minimize these impressive legal results, the true impact of Operation Honor Student lies in its practical effect on the illegal hGH market in the United States. Task force agents estimate that at the time of the investigation, GeneScience manufactured approximately 90% of the hGH being illegally sold and distributed in the United States. As a direct result of this seizure, GeneScience has stopped all shipments to the United States. So, through the use of a section 981(k) seizure, we were able to eliminate a supplier that represented 90% of an illegal drug market. Ninety percent.

Asset forfeiture plays a critical role not only in drug cases, but across the law enforcement spectrum -- from national security investigations, to securities fraud cases, to healthcare scams. And, of course, we cannot forget the most important -- and sometimes least heralded -- purposes of our Asset Forfeiture Program -- which is to make a meaningful difference in the lives crime victims by recovering stolen funds and property and returning them to their rightful owners.

When we look at the successes of both the Asset Forfeiture Program and the OCDETF Program, I cannot help but think about the possibilities, and challenges, for the next 25 years of these vitally important initiatives. While we have made great strides, international drug traffickers and money launderers continue to threaten our country. Criminal enterprises and terrorist networks continue to misuse our financial system for nefarious purposes. We can and we must do more. I am confident that under the leadership of those assembled here today, we will succeed.

The analysts, agents, and prosecutors of the OCDETF and Asset Forfeiture Programs are among the most talented and dedicated professionals in all of law enforcement. You protect this country day in and day out from the scourge of drugs and violence, and you do it with professionalism, creativity, and passion. I am proud to lead the Department of Justice, and am proud of each of you. Thank you for all that you do. Keep up the great work.

Source: U.S. Dept. of Justice

John Reece Roth, 72, of Knoxville, Tenn., was sentenced to 48 months in prison for violating the Arms Export Control Act by conspiring to illegally export, and actually exporting, technical information relating to a U.S. Air Force (USAF) research and development contract.

The sentencing, which was announced by U.S. Attorney Russ Dedrick of the Eastern District of Tennessee and David Kris, Assistant Attorney General for National Security, took place in U.S. District Court in Knoxville before Judge Thomas Varlan, Jr. A former University of Tennessee professor, Roth will serve a term of two years supervised release after completing his prison term.

The illegal exports by Dr. Roth of technical information, known as "technical data," related to his illegal disclosure and transport of restricted military information associated with the USAF contract to develop specialized plasma technology for use on an advanced form of an unmanned aerial vehicle (UAV), also known as a drone.

The illegal exports of military technical information involved specific information about advanced plasma technology that had been designed and was being tested for use on the wings of drones operating as weapons or surveillance systems. The Arms Export Control Act prohibits the export of defense-related materials, including the technical data, to a foreign national or a foreign nation.

After a trial in September 2008, Dr. Roth was convicted of conspiring with Atmospheric Glow Technology, Inc., a Knoxville technology company, of unlawfully exporting in 2005 and 2006 fifteen different "defense articles" to a citizen of the People's Republic of China in violation of the Arms Export Control Act. This law prohibits the export of defense-related materials, including the technical data, to a foreign national or a foreign nation. These defense articles related to different specific military technical data that had been restricted and was associated with the USAF project to develop plasma technology for use on weapons system drones.

Dr. Roth was also convicted of one count of wire fraud relating to defrauding the University of Tennessee of his honest services by illegally exporting sensitive military information relating to this USAF research and development contract.

The Federal Bureau of Investigation (FBI) led the investigation and was joined in its efforts by U.S. Immigration and Customs Enforcement (ICE), the U.S. Air Force Office of Special Investigations, and the Department of Commerce's Office of Export Enforcement. The case was prosecuted by Assistant U.S. Attorneys Jeffrey Theodore and Will Mackie of the U.S. Attorney's Office for the Eastern District of Tennessee.

U.S. Attorney Dedrick commended the efforts of the special agents from the agencies supporting the investigation. He noted that this case was quickly brought to trial and sentencing through the excellent work of the Department of Justice's National Security Division and the Assistant U.S. Attorneys and support staff from his office. Dedrick added, "This case should send a stern warning to those who would betray the trust of our nation by violating the export control laws by providing our military information to foreign nationals."

David Kris, Assistant Attorney General for National Security, stated, "I applaud the agents and prosecutors who worked tirelessly to bring about this result. The illegal export of restricted military data represents a serious threat to national security. We know that foreign governments are actively seeking this information for their own military development. Today's sentence should serve as a warning to anyone who knowingly discloses restricted military data in violation of our laws."

FBI Special Agent in Charge Richard Lambert added: "Safeguarding sensitive military technology vital to our nation's defense remains a top priority of the FBI. We are grateful to the University of Tennessee for its invaluable partnership in this important investigation."

Source: U.S. Dept. of Justice

On the day that President Obama holds his first summit with Saudi Arabian King Abdullah in Riyadh, the 9/11 Families United to Bankrupt Terrorism charged that recent actions by his administration would enable five of the king's closest relatives to escape accountability for their role in financing and materially supporting the September 11, 2001, terrorist attacks. In response to the administration's action, the 9/11 families released allegations made in 2002 of the Saudi royal family's sponsorship and support of al Qaeda that the families believe have been ignored by the Obama Administration.

On May 29, the president's top lawyer before the Supreme Court, Solicitor General Elena Kagan, filed a brief arguing that it would be "unwarranted" for the Supreme Court to even hear cases brought by the 9/11 families charging that five Saudi princes knowingly and intentionally provided financial support to al Qaeda waging war on America. By urging the high court to not review lower court decisions dismissing these cases, the Obama Administration took the side of the Saudi princes over thousands of family members and survivors of the 9/11 attacks seeking justice and accountability in U.S. courts.

"This is a betrayal of our fundamentally American right to have our day in court," said Mike Low of Batesville, Ark., father of Sara Low, an American Airlines flight attendant who died on board Flight 11. "It sacrifices the principles of justice, transparency, accountability and security, which our case embodies, in order to accommodate the political pleadings of a foreign government on behalf of a handful of members of its monarchy."

"With this filing, the Obama Administration has constructed a convoluted legal rationale to justify a political decision to curry favor with the Saudi royal family," said Ron Motley, counsel for the 9/11 families. "However, the legal straw house they built collapses with the faintest breeze of logic, legal analysis, or common sense."

"We trust that the Supreme Court, after it has reviewed the law, the facts and the evidence, will reject the Obama Administration's wrongheaded opinion and agree to give the 9/11 family members the day in court they deserve," Motley said.

To illustrate both the injustice of the Obama Administration's Supreme Court filing and the many holes in its legal reasoning, the family members released the specific allegations they originally made on what the princes did to provide financial and material support to Osama bin Laden, al Qaeda and the Taliban in the years and months leading up to September 11, 2001.

Specifically, the families' lawsuit alleges that:

• Prince Turki al Faisal al Saud, past head of Saudi intelligence, coordinated Saudi financial and logistical support for al Qaeda, Osama bin Laden and the Taliban. In July 1998, Prince Turki brokered an agreement between these parties in which the Saudis provided al Qaeda and the Taliban with generous financial assistance in exchange for a pledge by bin Laden and the Taliban that al Qaeda would not attack the Saudi royal family.(1)
• Prince Mohamed al Faisal al Saud headed the Islamic bank Dar al Maal al Islami, which provided global financial services and financing to al Qaeda and Osama bin Laden.(2)
• Prince Sultan Bin Abdulaziz al Saud, whose responsibilities included overseeing Islamic charitable funding in Saudi Arabia, funded al Qaeda through personal contributions to Islamic charities known to support bin Laden and his terrorist organization.(3)
• Prince Naif bin Abdulaziz al Saud, who has long supported Palestinian suicide bombers, provided pay-off money to al Qaeda. His oversight of al Qaeda front charity al Haramain allowed it to support bin Laden and al Qaeda unabated.(4)
• Prince Salman bin Abdul Aziz al Saud has a long history of funding Islamic extremists through his work as chairman of the General Donation Committee for Afghanistan. In this capacity, Prince Salman made substantial personal contributions to al Qaeda front charities with the full knowledge the charities were misappropriating funds and involved in terrorist activities.(5)

(More detailed allegations are contained in the attached chart.)

In the face of these allegations, Motley charged that the legal flaws in the Obama Administration's filing are all the more egregious.

For example, the solicitor general concedes that the Saudi princes as individual officials are not entitled to immunity under the Foreign Sovereign Immunities Act (FSIA). But even though the government has never previously expressed any notion of offering the Saudi princes any immunity for their alleged terrorist involvement, the administration urges that the Supreme Court should nonetheless treat the Princes as though they are immune anyway because of vague "non-statutory principles articulated by the Executive." This makes clear the Obama Administration is more concerned with the foreign relations consequences of making the Saudi princes answer for their donations to al Qaeda than with allowing the 9/11 families their fair day in court to address the princes' accountability for their conduct.

Moreover, even if the Saudi princes knowingly and intentionally gave money to al Qaeda waging war on America, the solicitor general argued that does not qualify for the "domestic tort exception" to sovereign immunity because the Saudi Princes did not give their money "within the United States." The solicitor general says it is not enough if the Saudis gave money to al Qaeda only from abroad. According to the solicitor general's argument, in order to strip immunity from the Saudi princes, "the foreign state's act or omission -- not that of any third party -- must occur in the United States."

The solicitor general further argues that U.S. courts cannot exercise personal jurisdiction over the Saudi Princes who gave money to al Qaeda because they were not "primary wrongdoer[s]" -- according to the solicitor general -- as they engaged in only "indirect funding of al Qaeda." But excusing the princes as not "primary wrongdoers" is in direct conflict with a recent Seventh Circuit ruling in the terror litigation context.(6) In this case, known as Boim v. Holy Land Foundation, the Seventh Circuit held that all those who donate money to known terrorist groups are themselves engaging in terrorism -- and thus "primary violators" subject to "primary liability" under the Anti-Terrorism Act section 2333. Boim further cautioned: "Nor should donors to terrorism be able to escape liability because terrorists and their supporters launder donations through a chain of intermediate organizations. Donor A gives to innocent-appearing organization B which gives to innocent-appearing organization C which gives to Hamas. As long as A either knows or is reckless in failing to discover that donations to B end up with Hamas, A is liable."(7)

The administration filing's bottom line, according to Motley, is that an official of any foreign country not "designated as a state sponsor of terrorism" is immune from suit as long as that official gave money "outside the United States" to terrorists -- even where those terrorists are waging a declared war causing massive death and destruction inside the United States. "This is an absurd misinterpretation of the law that, if carried to its logical extreme, could let all of al Qaeda's bankrollers off the hook," Motley charged. "If allowed to stand as the Obama administration's brief urges, the lower court's decision would allow terrorist financiers to stand at the borders of our nation providing all means of terrorist support, while snubbing their noses at our time honored judicial system of accountability."

The plaintiffs further allege that "Osama bin Laden and al Qaeda have publicly and proudly proclaimed direct responsibility for [prior] multiple atrocities in furtherance of international terrorism. Direct attacks on Americans intensified in 1998 after Osama bin Laden issued this 'fatwa,' stating: 'We -- with God's help -- call on every Muslim who believes in God and wishes to be rewarded to comply with God's order to kill the Americans and plunder their money wherever and whenever they find it.'"(8)

Motley said he was especially shocked that the solicitor general justified not holding foreign officials who give money to the 9/11 terrorists to account in an American court by repeating the same error made by the late District Judge Richard Conway Casey and the Second Circuit when they ruled plaintiffs' well-pleaded allegations were "inadequa[te]" and "conclusory" to show the Princes knew that they were funneling money to al Qaeda. "This is utter nonsense," Motley said, noting the specific detail of the allegations made, all of which allegedly show that the princes gave money to al Qaeda waging declared jihad on America, knowing that al Qaeda was targeting death and destruction on America.(9)

"What the solicitor general and the lower courts ignore is that the plaintiffs brought this suit to hold the defendants -- a handful of royals, other financiers, bin Laden, al Qaeda, and certain charities, banks and other organizations they own and control -- responsible for this insidious form of terrorism which cloaks itself behind the face of royal state titles and legitimacy," Motley said.

Osama bin Laden and his al Qaeda network do not exist in a vacuum, he explained. They could not plan, train and act on such a massive scale without significant financial power, coordination and backing.(10)

Select sources reporting Saudi Arabia is an important funding source for Islamic Extremism:

• United States Congress Senate Select Committee on Intelligence and United States Congress House Permanent Select Committee on Intelligence Joint Inquiry into Intelligence Community Activities before and after the Terrorist Attacks of September 11, 2001: Report of the U.S. Senate Select Committee on Intelligence and U.S. House Permanent Select Committee on Intelligence Together with Additional Views.
• Terrorist Financing. Report of an Independent Task Force Sponsored by the Council on Foreign Relations, October 2002. Available at www.cfr.org/pdf/Terrorist_Financing_TF.pdf and Update on the Global Campaign Against Terrorist Financing. Second Report of an Independent Task Force on Terrorist Financing Sponsored by the Council on Foreign Relations, June 15, 2004. See www.cfr.org/pdf/Revised_Terrorist_Financing.pdf.
• Hearing Before the Subcommittee on the Middle East and Central Asia of the Committee on International Relations House of Representatives One Hundred Eighth Congress Second Session March 24, 2004 Serial No. 108-109.
• International Affairs: Information on U.S. Agencies' Efforts to Address Islamic Extremism, GAO-05-852 (Washington: D.C.: United States Government Accountability Office, Sept. 2005).
• Iraq Study Group (U.S.), et al. The Iraq Study Group Report. 1st authorized ed. New York: Vintage Books, 2006.
• Testimony of Lee S. Wolosky Partner, Boies, Schiller & Flexner LLP U.S. House of Representatives Committee on Foreign Affairs September 18, 2007.
• U.S. State Department 2007 International Narcotics Control Strategy Report.
• Testimony of U.S. Department of the Treasury Undersecretary for Terrorism and Financial Intelligence Stuart A. Levey before the Senate Finance Committee, April 1, 2008.
• H. R. 1288 Saudi Arabia Accountability Act of 2009 111th Congress 1st Session.

              Allegations that the Saudi Princes Named as Defendants
               Provided Financial and Material Support to al Qaeda

    Source: Third Amended Complaint, Thomas E. Burnett, Sr., et al. vs. Al
    Baraka Investment & Development Corporation, et al., Case No. 03-CV-9849
    (GBD) as consolidated in In Re: Terrorist Attacks on September 11, 2001,
    Case No. 03-MDL-1570 (GBD), paragraphs 340, 344-346, 348-350.
    This can be viewed at www.motleyrice.com/terrorism/relevant_documents.asp.

    TAC Paragraph,    Specific Allegation
     Page
    97-99, pp.        Prince Mohamed al Faisal al Saud was the CEO of the
     244-245; 342,    Islamic bank Dar al Maal al Islami ("DMI") which
     p. 309; 364,      provided financing and financial services to al Qaeda
     p. 315

    340, p. 309       Prince Turki al Faisal al Saud had an ongoing
                       relationship with Osama bin Laden from the time that
                       they first met in Islamabad, Pakistan at the Saudi
                       embassy, during the Soviet Union's occupation of
                       Afghanistan.

    342, p. 309-310   Prince Abdullah al Faisal bin Abdulaziz al Saud,
                       Prince Naif bin Abdulaziz al Saud and Prince Salman
                       bin Abdul Aziz al Saud

                       have provided material support to Osama bin Laden and
                       al Qaeda. They also aided, abetted and materially
                       sponsored OBL and al Qaeda

    344, p. 310       Prince Turki, who headed the Royal Families
                       intelligence service for 25 years and met personally
                       with Osama bin Laden at least 5 times, guided the
                       Saudi intelligence service to provide substantial
                       financial and material support to the Taliban in or
                       about 1995.

    345, p. 310       Al Qaeda financier Mohammed Zouaydi had close
                       financial ties to Prince Turki and Prince Mohammed al
                       Faisal.

    346, pp. 310-311  According to a senior Taliban official, Prince Turki
                       was the facilitator of money transfers to the Taliban
                       and al Qaeda.

    347. p. 311       In 1996, a group of Saudi princes met with prominent
                       Saudi businessmen in Paris and agreed to continue
                       financially contributing and otherwise supporting
                       Osama bin Laden's terrorist network.

    348, p. 311       In July of 1998, a meeting occurred in Kandahar,
                       Afghanistan that led to an agreement between certain
                       Saudis and the Taliban. The participants were Prince
                       Turki, the Taliban leaders, and senior Pakistani
                       intelligence officers of the ISI and representatives
                       of Osama bin Laden. The agreement reached stipulated
                       that Osama bin Laden and his followers would not use
                       the infrastructure in Afghanistan to subvert the
                       royal families' control of Saudi government. In
                       return, the Saudis would make sure that no demands
                       for the extradition of terrorist individuals, such as
                       Osama bin Laden, and/or for the closure of terrorist
                       facilities and camps. Prince Turki also promised to
                       provide oil and generous financial assistance to both
                       the Taliban in Afghanistan and Pakistan. After the
                       meeting, 400 new pick-up trucks arrived in Kandahar
                       for the Taliban, still bearing Dubai license plates.

    349, p. 311       Prince Turki was instrumental in arranging a meeting
                       in Kandahar between Iraqi senior intelligence
                       operative, the Ambassador to Turkey Faruq al-Hijazi,
                       and Osama bin Laden, in December of 1998.

    350, p. 311       Saudi Intelligence, directed by Prince Turki until
                       August 2001, served as a facilitator of Osama bin
                       Laden's network of charities, foundations, and other
                       funding sources.

    354, p. 312       Prince Sultan has been involved in the sponsorship of
                       international terrorism through the IIRO and other
                       Saudi-funded charities.

    357-358. p. 313   King Fahd set up a Supreme Council of Islamic Affairs,
                       headed by his brother Prince Sultan to centralize,
                       supervise and review aid requests from Islamic
                       groups. This council was established to control the
                       charity financing and look into ways of distributing
                       donations to eligible Muslim groups. Consequently, as
                       Chairman of the Supreme Council, Prince Sultan could
                       not have ignored the ultimate destinations of
                       charitable funding, and could not have overlooked the
                       role of the Saudi charitable entities identified
                       herein in financing the al Qaeda terrorist
                       organization.

    359, pp. 313-314  Despite that responsibility and knowledge, Prince
                       Sultan personally funded several Islamic charities
                       over the years that sponsor, aid, abet or materially
                       support Osama bin Laden and al Qaeda: the
                       International Islamic Relief Organization (and its
                       financial fund Sanabel el-Khair), al-Haramain, Muslim
                       World League, and the World Assembly of Muslim Youth.
                       Despite that responsibility and knowledge, Prince
                       Sultan personally funded several Islamic charities
                       over the years that sponsor, aid, abet or materially
                       support Osama bin Laden and al Qaeda: the
                       International Islamic Relief Organization (and its
                       financial fund Sanabel el-Khair), al-Haramain, Muslim
                       World League, and the World Assembly of Muslim Youth.

    360, p. 314       Prince Sultan's role in the IIRO's financing is of
                       significance. Since the IIRO's creation in 1978,
                       Prince Sultan participated by donations and various
                       gifts to the charity. In 1994 alone, he donated
                       $266,652 to the Islamic International Relief
                       Organization. Since 1994, the amount funneled by
                       Prince Sultan into IIRO is reported to be $2,399,868.
                       Prince Sultan's role in directly contributing to and
                       in the oversight of IIRO evidences his material
                       sponsorship, aiding and abetting of international
                       terrorism. Prince Sultan maintains close relations
                       with the IIRO organization headquarters and knew or
                       should have known these assets were being diverted to
                       al Qaeda.

    361-362, p. 314   Prince Sultan is also a regular donator to the World
                       Assembly of Muslim Youth ( "WAMY"). WAMY was founded
                       in 1972 in a Saudi effort to prevent the "corrupting"
                       ideas of the western world influencing young Muslims.
                       With official backing it grew to embrace 450 youth
                       and student organizations with 34 offices worldwide.
                       WAMY has been officially identified as a "suspected
                       terrorist organization" by the FBI since 1996 and has
                       been the subject of numerous governmental
                       investigations for terrorist activities.

    370-371, p. 317;  Prince Abdullah al Faisal is the majority owner of
     372-373, p. 317   Alfaisaliah Group, also known as al Faisal Group
                       Holding Co. According to FBI records 9/11 hijacker
                       Hani Saleh H. Hanjour, his brother Abdulrahman Saleh
                       Hanjour, living in Tucson, Arizona, and 9/11 suspect
                       Abdal Monem Zelitny had registered addresses in Taif,
                       Saudi Arabia that correspond with an Alfaisaliah
                       Group branch office.

    374-375, p. 317   Prince Abdullah al Faisal's accountant in Jeddah,
                       Saudi Arabia was Defendant Muhammed Galeb Kalaje
                       Zouaydi, convicted in Spain for financing al Qaeda
                       operations in Europe. Zouaydi set up Spanish
                       companies established during the time he was staying
                       in Saudi Arabia and working for Prince Abdullah al
                       Faisal, between 1996 and 2000. Zouaydi laundered
                       Saudi money through Spain to an al Qaeda cell in
                       Germany. Eye witnesses place Zouaydi in Prince
                       Abdullah al Faisal's office in Jeddah.

    381, p. 319       Prince Naif, who has a long history of supported for
                       Palestinian suicide martyrs and Palestinian terrorist
                       organizations, has provided material support to al
                       Qaeda, including providing monetary payoffs to al
                       Qaeda.

    382, p. 319       Prince Naif, who is the Saudi Minister of Interior and
                       heads the Saudi Committee for Relief to Afghans,
                       supervised the activities of Defendant charity Al
                       Haramain Foundation, which materially supported al
                       Qaeda and the Taliban.

    392-399, pp.      In 1993, Prince Salman bin Abdul Aziz al Saud founded
     321-323           Saudi High Commission charity. The charity's Bosnian
                       offices were found to have sponsored al Qaeda members
                       and materially supported al Qaeda.

    400, pp. 323-324  Prince Salman has a history of funding Islamic
                       extremism. In 1980, Prince Salman was named Chairman
                       of the General Donation Committee for Afghanistan.

    401, p. 324       In 1999, Prince Salman made a donation of $400,000
                       during a fund-raising event organized for Bosnia
                       Herzegovina and Chechnya by Defendants International
                       Islamic Relief Organization, World Assembly of Muslim
                       Youths, and Al-Haramain Foundation.

    404-407,          Despite evidence of misappropriation of charitable
     pp.324-325        funds by directors of the Saudi High Commissions
                       Bosnian chapter, Prince Salman knowingly failed to
                       take appropriate action regarding the management and
                       distribution of funds.

(1)Third Amended Complaint, Thomas E. Burnett, Sr., et al. vs. Al Baraka Investment & Development Corporation, et al., Case No. 03-CV-9849 (GBD) as consolidated in In Re: Terrorist Attacks on September 11, 2001, Case No. 03-MDL-1570 (GBD), paragraphs 340, 344-346, 348-350. This can be viewed at www.motleyrice.com/terrorism/relevant_documents.asp.

(2)TAC paragraphs 97-99, 242, 244-245, 364.

(3)TAC paragraphs 354, 357-362.

(4)TAC paragraphs 342, 381-382.

(5)TAC paragraphs 392-401, 404-407.

(6)See Boim v. Holy Land Found., 549 F.3d 685 (7th Cir. 2008) (en banc).

(7)Id. at 701-702.

(8)TAC, p. 12.

(9)TAC.

(10)TAC.

SOURCE 9/11 Families/Burnett vs. Al Barak