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Broken Banking

Philippine Government to Probe Marcos Daughter’s Offshore Trust

May 4th 2013

Caribbean Sea Shore

Philippine government officials said Friday that they will look into a media organization’s disclosure that the eldest daughter of the late dictator Ferdinand Marcos was a beneficiary of a secret offshore trust in the British Virgin Islands.

Maria Imelda Marcos Manotoc, more popularly known as Imee Marcos, did not report her offshore trust on asset disclosure statements that she’s required to file every year as a public official, according to a story released Thursday by the International Consortium of Investigative Journalists and the Philippine Center for Investigative Journalism.

She has been governor of Ilocos Norte province, her father’s traditional political bailiwick, since 2010, and was a member of the Philippine’s House of Representatives from 1998 to 2007.

“We are duty bound to investigate and, depending upon informed preliminary findings, decide whether to pursue the matter,” Andres Bautista, the chairman of the Presidential Commission on Good Government, told Agent France-Presse. The commission is tasked with recovering the Marcos family’s alleged ill-gotten wealth. Read more ..


Broken Banking

After Multi-Million Inheritance, Playboy Sachs Goes Offshore

April 29th 2013

International Currency 2

He's known as Brigitte Bardot’s husband, photographer, director, art collector. Now another aspect has come to light:  a man who set up an intricate offshore scheme to manage his vast fortune, a scheme that remained inscrutable to the fiscal authorities until the end.

The hand that governs everything must remain invisible. It certainly must not sign anything. That is why Hanswerner Schwenk, a private secretary in his 50s, sets off for the Pacific island of Rarotonga.

Meanwhile, the man behind the scenes can relax: in London, Paris or St. Tropez, on one of his many estates. His name must not appear in any official document, for such is the nature of an anonymous enterprise. Otherwise one would not need to bother with all the hassle, after all: the South Seas, the lawyers and all that secretiveness.

It is a strenuous trip for Schwenk, who lives in Munich. Rarotonga is situated about halfway between New Zealand and Hawaii, and it takes him more than 40 hours to get there from Germany. At least his local partner, the International Trust Corporation Ltd., has arranged for a hotel and a rental car. Hanswerner Schwenk’s mission: confirm with his signature that the share issue of the recently founded company Triton Ltd. proceeded in a lawful way. Read more ..


Broken Banking

French Banks Traded in Secrecy

April 27th 2013

International Currency 3

The “Offshore Leaks” files published around the world on April 4 show that, from the late 1990s until the end of the 2000s, two major French banks, BNP Paribas and Crédit Agricole, oversaw the creation of a large number of totally opaque offshore companies in the British Virgin Islands, Samoa and Singapore for clients in search of secrecy and lower tax rates.

These are the findings unearthed by the International Consortium of Investigative Journalists (ICIJ), which has been researching the story for over a year. According to these secret documents, BNP Paribas channels operations through its Singapore and Hong Kong subsidiaries, whereas Crédit Agricole relies on its Geneva-based Swiss subsidiary.

Both banks have set up companies through their Asian subsidiaries with the help of Portcullis TrustNet, a service provider that specializes in offshore business and turnkey companies (the famous “quick” companies that can be incorporated within 48 hours) for rich clients claiming to be domiciled in Asia and concealed by nominees. Read more ..


Broken Banking

Jailed Property Man Hid Assets Offshore During Divorce

April 25th 2013

One Million Dollars

Jailed British property developer Scot Young, an associate of Russian oligarch Boris Berezovsky, constructed a secret network of offshore companies to hold his assets during a multimillion-pound divorce battle, according to the International Consortium of Investigative Journalists (ICIJ's) research.

His story graphically demonstrates the way hideaways such as the British Virgin Islands (BVI) can be used by a man bent on cheating the law.

Young, 51, described as a fixer for the super-rich, rose suddenly from working-class origins in Dundee to occupy a $21 million Oxfordshire mansion and to throw his money about in spectacular fashion. He once bought his then wife, Michelle, a Range-Rover filled to the roof with couture dresses. For her 40th birthday, he gave her a $1.5 million necklace. Read more ..


The Defense Edge

Pentagon Claims $757 Million Overbilling by Contractor in Afghanistan

April 24th 2013

US troops in Iraq

The Pentagon allowed a private firm providing food and water to U.S. troops in Afghanistan to overbill taxpayers $757 million and awarded the company no-bid contract extensions worth more than $4 billion over three years, according to the Pentagon’s chief internal watchdog and congressional investigators.

The deal represented one of the largest U.S. military contracts in Afghanistan. But the Defense Logistics Agency, which was overseeing the contract, failed repeatedly to verify that the contractor’s invoices were accurate, an official in the Defense Department inspector general’s office said. "This has to be one of the prime poster childs for a government contract spun out of control," Rep. John Mica, R-Fla., said last week.

Mica and other members of the House Oversight and Governmental Reform Subcommittee on National Security expressed outrage at a hearing last week about the Pentagon’s handling of the deal, especially two contract extensions awarded amid a dispute between the government and the company over as much as $1 billion. Read more ..


Broken Banking

Faux Corporate Directors Stand in for Fraudsters, Despots and Spies

April 23rd 2013

International Currency 3

On November 14, 2006, a man going by the name Paul William Hampel was arrested at a Canadian airport on charges of being a Russian spy. Hampel’s carefully constructed identity portrayed him as a successful businessman, yet for a decade his company did no business.

Only months before his capture, the same apparatus used to create his alias was also employed by a very different spy agency - the U.S. Central Intelligence Agency —to build a secret prison in Lithuania, where U.S. agents interrogated suspected al-Qaeda terrorists.

Earlier again, it was used by the regime of former Iraqi dictator Saddam Hussein to cheat the Oil for Food program.

All three deceptions employed a common subterfuge: far-flung corporate entities used as anonymous fronts, with “executives” who lacked knowledge of what the firms were up to. The activities of these so-called nominee directors are a little noticed part of the world of secretive offshore finance that’s grown so vast that it touches more than 170 of the globe’s 206 countries, but it’s one that’s often drenched in intrigue. Read more ..


Broken Banking

Top Malaysian Politicians Use Offshore Secrecy

April 18th 2013

Malaysia city

Key members of the Malaysian government, their families, and well-heeled associates are among those owning secretive offshore companies in Singapore and the British Virgin Islands, according to a cache of leaked documents.

They include former prime minister Mahathir Mohamad's son Mirzan, Federal Territories and Urban Well-Being Minister Raja Nong Chik Zainal Abidin and Michael Chia, the alleged ‘bagman' for Sabah Chief Minister Musa Aman.

The files, which were obtained by the Washington-based International Consortium of Investigative Journalists (ICIJ) and examined by Malaysiakini, show more than 1,500 Malaysians owning offshore companies in Singapore – dubbed as the new Switzerland  – as well as the British Virgin Islands (BVI), an international tax haven. The ICIJ list comprises a curious mix of Forbes-listed tycoons, parliamentarians, retired politicians, civil servants and their spouses, members of royal families, famous and infamous businesspeople, underworld kingpins and even former beauty queens. Read more ..


Broken Banking

Son of Leading Pakistani Politician Tied To Secret Caribbean Company

April 17th 2013

Caribbean Sea Shore

The scandal-buffeted heir to one of Pakistan’s most powerful political dynasties, the Chaudhry family, owned a secret company in the British Virgin Islands he created with the help of Swiss bank UBS, according to documents obtained by the International Consortium of Investigative Journalists.

Moonis Elahi, son of Chaudhry Pervaiz Elahi, who has just stepped down as deputy prime minister, was the sole shareholder in an offshore company called Olive Grove Assets Ltd, created in 2006 in the British Virgin Islands according to corporate records reviewed by ICIJ. In 2008 Moonis Elahi won a seat in the Punjab Provincial Assembly.

Elahi was swept up in scandal in 2011 when government prosecutors accused him of obtaining illegal payments in an alleged land scam involving the government-owned National Insurance Company Limited (NICL). Read more ..


Broken Banking

Lawyers and Accountants Help Rich Manage Their Money

April 17th 2013

Indonesian-Beaches

The story of Portcullis TrustNet and its birthplace — the Cook Islands — is in many ways the story of the offshore system itself.

It’s a largely invisible world, a curious blend of the parochial and the global that’s made up of the minor personalities and politics inside each offshore jurisdiction — many with populations no larger than a small town.

But by establishing special zones, these tiny provinces have changed the face of international finance and business and impacted law enforcement, tax policies and political and economic transparency across the planet. Read more ..


Broken Banking

Secret Files Reveal Rothschild’s Offshore Domain

April 16th 2013

EU flag

Baron Elie de Rothschild, the guardian of the French branch of the famed Rothschild banking dynasty, built an offshore empire in the palm-fringed Cook Islands between 1996 and 2003. Rothschild, a businessman and arts patron who died in 2007 at the age of 90, constructed a complex network of offshore trusts and front companies, according to secret documents obtained by the International Consortium of Investigative Journalists (ICIJ) and reviewed by Le Monde. The complex nature of the financial arrangements in the Pacific islands and their near-total secrecy made it difficult to identify his hand in the offshore entities. The internal documents reveal at least 20 trusts and 10 holding companies were set up for Rothschild in the Cook Islands, an independent territory in the South Pacific with close ties to New Zealand. The trusts have typically opaque names, Anon Trust, followed by the Benon Trust (apparently set up by Rothschild’s daughter Nelly) and Denon Trust, being notable examples. Read more ..


Broken Banking

The Swiss Lawyers Who Help Europe’s Richest Families Park Their Wealth Offshore

April 16th 2013

Swiss Banks' Lawyers

Little did Zurich-based lawyer Peter Hafter imagine how things would turn out when he ordered a $2,700 offshore kit to create a front company in the Cook Islands on September 13, 1993. Twenty years on from that day, the fax he sent, the ensuing emails and all his business correspondence with Portcullis TrustNet in Rarotonga, the largest island in the archipelago, have been copied and passed on to journalists around the world. Nor did the lawyer imagine that the internal revenue service would then reopen the case of one of his clients, and yet that is precisely what the spokesperson for the tax authorities in Berne, Yvonne von Kauffungen, announced on Thursday. This announcement was triggered by the publication of a preview based on our investigations into two decades of correspondence between Portcullis TrustNet and Peter Hafter. Matin Dimanche and SonntagsZeitung have reviewed hundreds of pages of confidential documents that are part of a cache of 2.5 million files obtained by the International Consortium of Investigative Journalists – probably the largest set of confidential financial data ever disclosed to the media.  Read more ..


Broken Banking

Billionaires Among Thousands of Indonesians Found in Secret Offshore Documents

April 15th 2013

Indonesian-Beaches

Nine of Indonesia’s 11 richest families have found shelter in tropical tax havens, holding ownership of more than 190 offshore trusts and companies, secret records obtained by the International Consortium of Investigative Journalists show.

The nine families, worth an estimated $36 billion among them, are at the top of a wealthy class that dominates Indonesia’s politics and economy. Six were closely tied to the late dictator Suharto, who helped a special circle of Indonesians grow rich during his 31-year rule by granting economic fiefdoms to family and friends. The billionaires are among nearly 2,500 Indonesians found in the files of Singapore-headquartered offshore services provider Portcullis TrustNet, which ICIJ has been analyzing and began reporting on last week. Read more ..


Broken Banking

Offshore Tax Havens Became Traps for Investors

April 12th 2013

International Currency 2

A New York hedge fund manager allegedly swindles $12 million from a prominent Baltimore family. An Indiana couple is accused of bilking hundreds of customers by charging for free trials of cosmetic products. A financial manager in Texas promises 23-percent returns but absconds with $33.5 million of his investors’ money in a classic Ponzi scheme.

All three cases have one thing in common: money that ended up in offshore accounts and trusts set up in tax havens around the world.

The existence of the trusts surfaced during a joint examination of the offshore world by The Washington Post and the International Consortium of Investigative Journalists, a D.C-based nonprofit news organization. ICIJ obtained 2.5 million records of more than 120,000 companies and trusts created by two offshore companies, Commonwealth Trust Ltd. (CTL) in the British Virgin Islands and Portcullis TrustNet, which operates mostly in Asia and the Cook Islands, a South Pacific nation. The records were obtained by Gerard Ryle, ICIJ’s director, as a result of an investigation he conducted in Australia. Read more ..


Broken Banking

Dutch Banking Giants Helped Clients Go Offshore

April 11th 2013

International Currency 3

The Dutch banks ING and ABN Amro registered dozens of companies for their clients in offshore refuges with lovely beaches and low tax rates such as the British Virgin Islands, the Cook Islands and the Malaysian island of Labuan, an investigation by Dutch newspaper Trouw and the International Consortium of Investigative Journalists has found.

Trouw found the information in leaked documents and emails from two companies — Singapore-based Portcullis TrustNet and British Virgin Islands-based Commonwealth Trust Limited — that specialize in helping customers set up and manage companies in offshore centers known as havens for individuals who want to reduce their taxes. ING and ABN Amro said they have never been party to tax evasion. “The companies were set up for international clients and always in compliance with local and international laws,” ABN Amro said in a statement. Read more ..


Broken Immigration

Illegal Aliens Bypass U.S. Border Agents via Indian Reservations: GAO

April 10th 2013

US/Mex Border fence

Foreign nationals seeking to enter the United States illegally have been known to avoid Border Patrol screening procedures by surreptitiously crossing into areas between these ports of entry, including Indian reservations, many of which have been vulnerable to illicit cross-border threat activity, such as drug smuggling, according to the Department of Homeland Security officials in a report released on Friday. The Government Accountability Office was requested by U.S. lawmakers to investigate DHS's efforts to coordinate border security activities on Indian reservations. In complying with Congress' request, GAO researchers examined DHS's efforts to coordinate with tribal governments to address border security threats and vulnerabilities on Indian reservations. GAO investigators reported that they interviewed DHS officials at headquarters and conducted interviews with eight tribes, selected based on factors such as proximity to the border, and the corresponding DHS field offices that have a role in border security for these Indian reservations. While GAO cannot generalize its results from these interviews to all Indian reservations and field offices along the border, they provide examples of border security coordination issues. Read more ..


Broken Government

Government's Green Car Loan Program Appears to be Stalling

March 19th 2013

Flat Tire

A Department of Energy loan program, infused with $25 billion to spur a wave of fuel-efficient vehicles, has not closed a loan in two years and is likely to leave two-thirds of the money unspent amid fallout over the Solyndra debacle and other factors.

Those findings, revealed Friday in a U.S. Government Accountability Office report, rekindle questions over how effectively the Energy Department picks winners and losers for its lucrative green energy portfolio.

The audit focuses on DOE loan programs, including one known as ATVM — the Advanced Technology Vehicles Manufacturing program.

That program was pitched as part of a broader government campaign to spur innovative, clean technologies that would both rev up the economy and clean the environment. Under ATVM, the government would help bankroll electric cars and other fuel-saving initiatives; this seed money would, in turn, trigger a domino effect for industry and consumers.

Yet the last loan closed in March 2011, and just $8.4 billion has been spent so far in five projects. Read more ..


The Toxic Edge

EPA Unaware of Industry Ties on Cancer Review Panel

February 13th 2013

Drain to ocean

In September 2010, scientists at the Environmental Protection Agency came to a startling conclusion: Even a small amount of a chemical compound commonly found in tap water may cause cancer.

The compound, hexavalent chromium, gained infamy in the Oscar-winning film Erin Brockovich, based on the David-vs.-Goliath legal duel between desert dwellers in Hinkley, Calif., and Pacific Gas & Electric Co. The film ends in Hollywood fashion, with the corporate polluter paying $333 million to people suffering from illnesses.

But in real life, the drama continues. More than 70 million Americans drink traces of chromium every day, according to the Environmental Working Group, a nonprofit research organization. And now, more than a decade after the film, EPA scientists cite “clear evidence” that the chemical compound, also known as chromium (VI), can cause cancer. The federal agency was poised to announce its findings in 2011, a step almost certain to trigger stricter drinking-water standards to prevent new cancers and deaths. Read more ..


Broken Banking

How US Tax Money Pays to Expand Shariah Economies

January 12th 2013

Iranian Rial Close-Up

Under Obama’s administration, the U.S. Agency for International Development, or USAID, bears little resemblance to the international aid agency that President John F. Kennedy initiated on Nov. 3, 1961. USAID’s stated goal was to further “America’s foreign policy interests in expanding democracy and free markets while also extending a helping hand to people struggling to make a better life, recover from a disaster or striving to live in a free and democratic country.”

However, upon issuing the first USAID loan guarantee of $1.15 million to an Islamic bank in Indonesia in August 2011, the agency’s blog justified the move, stating: “The finance guarantee agreement builds on President Obama’s speech in Cairo, which called for deeper engagement with the Muslim world.”

The development of Islamic banking was made possible by Malaysia. A recent Economist article, “Banking on the ummah,” reviewed the country’s Islamic banking industry and pointed out the lack of standardized regulations and transparency. But the piece ignored the country’s role in implementing the Muslim Brotherhood’s larger agenda to create a “parallel economy by first infiltrating and co-opting the Western economy.

Read more ..

The Battle for Syria

Israel Reportedly Stopped Syria Unit 450 from Deploying Chemical Bombs

January 9th 2013

IDF Soldiers

As fears surfaced that Syria could use chemical weapons against rebels and citizens in the country, Israel led the charge to halt the decisive action.

According to a report in the New York Times, in late November top Israeli commanders alerted the Pentagon to intelligence picked up by satellite that suggested Syrian troops were mixing chemicals at two storage sites, probably the deadly nerve gas sarin, and filling dozens of 500-pounds bombs that could be loaded on airplanes.

Soon after U.S. President Obama was informed, and officials told him that were the Syrians to use the weapons the U.S. might not be able to stop them. According to the Times, what followed next was a “a remarkable show of international cooperation” in which both opponents and supporters of Bashar al-Assad, such as China and Russia,  pressed Syria to halt whatever steps towards the use of chemical weapons the country might have been taking. Read more ..


Broken Campus

Notre Dame Case Highlights Complexities Of Campus Sexual Assault Investigations

January 8th 2013

Woman

Notre Dame’s high-profile re-emergence among college football’s elite has focused new attention on the university’s long-standing claims that it does things “the right way” — that football players are treated like anyone else on campus, with no special favors.

The boasts of lofty moral standards have long struck other schools’ fans as a bit sanctimonious. But they are getting fresh scrutiny now, in part because the bright lights of college football’s biggest stage have brought renewed attention to a two-year-old case involving a Notre Dame player and chilling allegations of sexual assault.

In August 2010, 19-year-old freshman Lizzy Seeberg accused the athlete of sexually assaulting her in his dorm. She filed a report with campus police, which sat on it for two weeks before even interviewing him. By then, Seeberg had committed suicide. Administrators would later convene a closed-door campus disciplinary hearing—three months after Seeberg’s death became national news—in which the player was found “not responsible.” In the university's only direct comment on the case, Notre Dame's president, the Rev. John I. Jenkins, told the South Bend Tribune in December 2010 that university police had conducted a "thorough and judicious investigation that followed the facts..." He acknowledged, however, that the inquiry could have been conducted "more quickly, perhaps." The player, who has not been publicly identified, reportedly has never missed a game, nor presumably will he miss tonight’s national championship contest with Alabama’s Crimson Tide. Meanwhile, a small but vocal number of critics are asking pointed questions about how this case was handled, and wondering aloud whether Notre Dame’s righteous rhetoric is really a fiction.

Read more ..

The New Egypt

Morsi Caught on Tape Refers to Jews as “The Descendants of Apes and Pigs”

January 4th 2013

Mohammed Morsi

In two separate  2010 interviews with Al-Quds TV in Lebanon, Egyptian President Mohamed Morsi makes disparaging remarks about Jews and dismisses peace negotiations between Israel and the Palestinian Arabs. In one interview, dated September 23, Morsi refers to Jews as “the descendants of apes and pigs.” During the interview, which was released by The Middle East Research Institute’s (MEMRI) today, Morsi also declares that peace negotiations are futile and promotes the use of force. “There should be military resistance within the land of Palestine against those criminal Zionists, who attack Palestine and the Palestinians,” he says.

In another interview, dated March 20th, Morsi continues to promote the use of force against Israel. “We must all realize that resistance is the only way to liberate the land of Palestine,” he says. Then he dismisses Israel’s right to exist. “The Zionists have no right to the land of Palestine. There is no place for them on the land of Palestine.”

Read more ..

The Edge of Health

Fructrose Slammed by Scientists on Obesity Epidemic

January 2nd 2013

Obese man

In a study examining possible factors regarding the associations between fructose consumption and weight gain, brain magnetic resonance imaging of study participants indicated that ingestion of glucose but not fructose reduced cerebral blood flow and activity in brain regions that regulate appetite, and ingestion of glucose but not fructose produced increased ratings of satiety and fullness, according to a preliminary study published in the January 2 issue of JAMA.

"Increases in fructose consumption have paralleled the increasing prevalence of obesity, and high-fructose diets are thought to promote weight gain and insulin resistance. Fructose ingestion produces smaller increases in circulating satiety hormones compared with glucose ingestion, and central administration of fructose provokes feeding in rodents, whereas centrally administered glucose promotes satiety," according to background information in the article. "Thus, fructose possibly increases food-seeking behavior and increases food intake." How brain regions associated with fructose- and glucose-mediated changes in animal feeding behaviors translates to humans is not completely understood. Read more ..


The Darkest Edge

Tax Breaks for Assault Rifle Manufacturing

January 2nd 2013

Shooter shooting AR15

Taxpayers across the country are subsidizing the manufacturers of assault rifles used in multiple mass killings, including the massacre of 20 children and six adults at an elementary school in Newtown, Conn. last month.

An examination of tax records shows that five companies that make semi-automatic rifles have received more than $19 million in tax breaks, most within with the past five years.

“I feel horrified at the power of the gun industry over our political system, that it could exert such influence,” said Newtown resident Barbara Richardson, who lives between the homes of one of the 6-year-old victims and the shooter. Saying she respects hunters who are ethical and good neighbors, she “absolutely [does] not” support taxpayer subsidies to help manufacture assault rifles: “They’re weapons of mass destruction.”
Read more ..

The Education Edge

Curfew Violations in Los Angeles Still Generate Thousands of Tickets Impacting Education

December 29th 2012

Downtown LA Neighborhood

Even as Los Angeles authorities continue efforts to reform school-discipline standards, fresh data show that police from the city’s biggest school district are continuing to ticket thousands of young students, especially minorities, at disproportionate rates that critics charge are putting them on a track for dropping out.

Citation rates for this year are little changed from 2011 data. Disclosure of the 2011 data this past spring led to federal civil-rights scrutiny and promises that policies at the Los Angeles Unified School District would be reviewed, and likely changed.

In 2011, children 14 or younger in the school district, the area’s biggest, were issued 43 percent of the nearly 10,200 tickets school police handed out to students for fighting, daytime-curfew violations and other minor infractions — indiscretions that community groups and judges have maintained might better be handled by school officials or referred directly to community-based counseling.

Read more ..

The Toxic Edge

Study Spotlights High Breast Cancer Risk for Plastics Workers

November 19th 2012

Smokestacks

For more than three decades, workers, most of them women, have complained of dreadful conditions in many of this city’s plastic automotive parts factories: Pungent fumes and dust that caused nosebleeds, headaches, nausea and dizziness. Blobs of smelly, smoldering plastic dumped directly onto the floor. “It was like hell,” says one woman who still works in the industry.

The women fretted, usually in private, about what seemed to be an excess of cancer and other diseases in the factories across the river from Detroit. “People were getting sick, but you never really thought about the plastic itself,” said Gina DeSantis, who has worked at a plant near Windsor for 25 years.

Now, workers like DeSantis are the focal point of a new study that appears to strengthen the tie between breast cancer and toxic exposures. The six-year study, conducted by a team of researchers from Canada, the United States and the United Kingdom, examined the occupational histories of 1,006 women from Ontario’s Essex and Kent counties who had the disease and 1,146 who didn’t. Adjustments were made for smoking, weight, alcohol use and other lifestyle and reproductive factors. Read more ..


The 2012 Vote

Obamacare Plagued by Conflict of Interest Charges

November 3rd 2012

medicine and money

The Obama administration is relying heavily on outside contractors to implement a core component of healthcare reform as it races to set up a federal health insurance marketplace before 2014. The fast-approaching deadline gives the administration little time to scrutinize private-sector partners for conflicts of interest.

The purchase of one of these contractors, Quality Software Services, Inc. (QSSI), by UnitedHealth Group, a major healthcare conglomerate, has sparked concerns about a potentially uneven playing field.
QSSI, a Maryland-based contractor, in January won a large contract to build a federal data services hub to help run the complex federal health insurance exchange. It will be working with several other contractors, including CGI Federal, Inc., to create the technological architecture for the exchange.

The quiet nature of the transaction, which was not disclosed to the Securities and Exchange Commission (SEC), has fueled suspicion among industry insiders that UnitedHealth Group may be gaining an advantage for its subsidiary, UnitedHealthcare. UnitedHealth Group’s acquisition has caught the attention of Sen. Orrin Hatch (R-Utah), the ranking member on the Senate Finance Committee. He has expressed alarm over what he calls a lack of transparency in setting up a national insurance marketplace covering more than 30 states. He asked Health and Human Services (HHS) Secretary Kathleen Sebelius in an Oct. 19 letter for a full account of contractors hired to set up the national exchange and a list of administration officials who signed off on those awards. Read more ..


The 2012 Vote

South Dakota Campaign Funds Can Move Sideways

October 24th 2012

Money Stack

In South Dakota, the ease with which campaign cash moves around has mostly put power in the hands of those who already had it — the wealthy and the state's top elected officials. Because of lax regulations regarding how money can flow into and out of political action committees, political party funds and individual candidate funds, the state's top officeholders are able to legally skirt existing fundraising limits and get relatively large sums into campaign coffers with little effort.

The lack of oversight was, in part, responsible for the Rushmore State’s "F" grade for regulation of political finances from the State Integrity Investigation, released earlier this year.

South Dakota is one of 19 states with a system of campaign finance regulation that allows money to effectively move "sideways," says Ed Bender, executive director of the National Institute on Money in State Politics. South Dakota and 12 other states place no limits on what state parties or political action committees can give individual candidates, according to research done by the National Conference of State Legislatures. Another six states limit PAC contributions but not party contributions. Read more ..


The 2012 Vote

Pennsylvania Governor Benefited from Untraceable $1.5 Million Donation

October 18th 2012

Bundles of Money

At a campaign stop near Philadelphia early in his 2010 bid for governor, Republican Tom Corbett announced “we’ve got to raise money,” that it was the “number-one” priority. In an answer to his prayers, that same July day, a $1.5 million contribution arrived from — Wisconsin?

Officially, the donation was from the Wisconsin affiliate of a D.C.-based political organization called the Republican Governors Association. The $1.5 million could not travel directly from the RGA to Corbett. Pennsylvania law bans candidates from accepting corporate money and the RGA accepts millions of dollars from some of the nation’s largest businesses. 

Also, state law requires all non-individuals to establish PACs in Pennsylvania. In a single day, the $1.5 million gift traveled from the D.C.-based parent organization to the RGA Wisconsin PAC, to the RGA Pennsylvania PAC and finally to Corbett’s campaign account.

By the time the donation reached Corbett, it was impossible to identify the original source of the cash or whether the donation was permissible under state law. The well-traveled donation is a prime example of “an elaborate money-laundering scheme, which is legal,” used by the RGA with success in a number of races for governor in 2010, according to Pennsylvania Common Cause Executive Director Barry Kauffman. Read more ..


Oil Addiction

Texas Pollution Victims Seek Millions From Citgo

October 5th 2012

Citco Refinery

Fifteen residents of Corpus Christi, Texas — so sickened by pollution they have been deemed crime victims — are asking a federal judge to force Citgo Petroleum Corp. to set up multimillion-dollar trust funds to cover medical and relocation costs, in a case with national ramifications. A jury in 2007 convicted Citgo of criminal violations of the Clean Air Act, concluding that the company’s Corpus Christi refinery allowed toxic chemicals to drift from two large, uncovered storage tanks into a nearby neighborhood for a decade. The company was to have been sentenced last month; the Department of Justice has proposed a fine of slightly more than $2 million. Lawyers for the 15 residents, however, asked U.S. District Judge John D. Rainey to grant the residents crime-victim status so they could testify at the sentencing hearing and, perhaps, win compensation from Citgo. Rainey granted that status on Sept. 14 and postponed the hearing.

Read more ..

The Edge of Terrorism

National Intelligence Fusion Centers Have Been Useless--Senate Report

October 3rd 2012

National Fusion center

An alarming report published by the Department of Homeland Security in March 2010 called attention to the theft of dozens of pounds of dangerous explosives from an airport storage bunker in Washington state. Like many such warnings, it drew on information gathered by one of the department’s “fusion centers” created to exchange data among state, local and federal officials, all at a cost to the federal government of hundreds of millions of dollars.

There was just one problem with that report, and many others like it: the theft had occurred seven months earlier, and it had been highlighted within five days in a press release by the Justice Department’s Bureau of Alcohol, Tobacco, Firearms and Explosives, which was seeking citizen assistance in tracking down the culprits. The DHS report’s tardiness and its duplication of work by others has been a commonplace failing of work performed by fusion centers nationwide, according to a new investigation of the DHS-funded centers by the Senate Permanent Subcommittee on Investigations.

Read more ..

Iran's Nukes

Inside Iran's Nuclear Warhead

September 27th 2012

Edwin Black

Since the last century, Iran has been methodically pursuing the in-house capability of developing a missile-delivered nuclear bomb. The regime of President Mahmoud Ahmadinejad is now closer than ever and probably in the latter stages of perfecting an atomic bomb with a multipoint detonation mechanism, compact enough to insert into a Shahab-3 missile nosecone.

For years, the Obama administration, Western governments, the United Nations, and the International Atomic Energy Administration (IAEA) have been fully aware of the specific details of Tehran’s nuclear weapons program, down to the blueprints and names of the engineers. Whether or not Iran will complete the last leg of its decades-long journey toward a deliverable atomic bomb is still unknown. The difference in viewing the cannon is whether you are staring down the muzzle or observing it through a telescope from a perch six thousand miles away. Israel is peering into the muzzle, hence its assessment is different than Washington’s.

Protracted multilateral negotiations, crippling international sanctions, and even elaborate programs of sabotage have delayed but not derailed the nearly autarkic program. Now the world teeters at the brink of a regional war with profound global ramifications because the threat may have been ignored too long.

Here are the four determining factors, the dynamics of which will govern whether Israel launches a preemptive attack against Tehran’s massive nuclear infrastructure.

The four technological achievements are key to completing Tehran’s nuclear weapon are: 1) accretion of enough nuclear materials, highly enriched to 90 percent, to make the bomb; 2) machining that highly-enriched material into metal for a spheroid warhead so it can fit into a missile nosecone for detonation; 3) a trigger mechanism to initiate the atomic explosion at the precise moment of missile reentry; and, of course, 4) a reliable rocket delivery system to carry such a weapon. Read more ..


Broken Medicine

Growth of Electronic Medical Records Eases Path to Inflated Bills

September 20th 2012

medicine and money #2

Electronic medical records, long touted by government officials as a critical tool for cutting health care costs, appear to be prompting some doctors and hospitals to bill higher fees to Medicare for treating seniors.

The federal government’s campaign to wire up medicine started under President George W. Bush. But the initiative hit warp drive with a February 2009 decision by Congress and the Obama administration to spend as much as $30 billion in economic stimulus money to help doctors and hospitals buy the equipment needed to convert medical record-keeping from paper files. In the rush to get the program off the ground, though, federal officials failed to impose strict controls over billing software, despite warnings from several prominent medical fraud authorities. Now that decision could come back to haunt policy makers and taxpayers alike, an investigation has found. Read more ..


Broken Helathcare

Hospitals Grab At Least $1 Billion In Extra Fees For Emergency Room Visits

September 20th 2012

ER Entrance

Judging by their bills, it would appear that elderly patients treated in the emergency room at Baylor Medical Center in Irving, Texas, are among the sickest in the country — far sicker than patients at most other hospitals.

In 2008, the hospital billed Medicare for the two most expensive levels of care for eight of every 10 patients it treated and released from its emergency room — almost twice the national average, according to a Center for Public Integrity analysis. Among those claims, 64 percent of the total were for the most expensive level of care. But the charges may have more to do with billing practices than sicker patients. A Baylor representative conceded hospital billing for emergency room care “did not align with industry trends,” but said that the hospital since 2009 has reined in its charges.

The Texas hospital’s billing pattern is far from unique. Between 2001 and 2008, hospitals across the country dramatically increased their Medicare billing for emergency room care, adding more than $1 billion to the cost of the program to taxpayers, a Center investigation has found. The fees are based on a system of billing codes — so-called evaluation and management codes — that makes higher payments for treatments that require more time and resources.

Read more ..

Broken Healthcare

Complex Healthcare Billing Complexity Spawns Great New Industry

September 20th 2012

stethoscope

Eleven years ago, Dr. Kathryn Locatell’s testimony at a U.S. Senate hearing on alleged Medicare billing abuses generated a rush of media coverage, but little lasting reform. Locatell, a California physician, helped expose medical billing consultants who made a living teaching doctors how to use the billing system to reel in higher fees. The techniques ranged from billing for medical treatments that weren’t needed to packing a patient’s file with irrelevant details as a means to justify higher, more lucrative, Medicare billing codes. “The information presented to us at the seminars did not include any method of … ensuring that the services billed for were medically necessary,” Locatell testified at the June 2001 Senate Finance Committee hearing.

Read more ..

Broken Healthcare

How Doctors And Hospitals Have Collected Billions In Questionable Medicare Fees

September 16th 2012

medicine and money

Thousands of doctors and other medical professionals have steadily billed higher rates for treating elderly patients on Medicare over the last decade — adding $11 billion or more to their fees and signaling a possible rise in medical billing abuse, an investigation has found.

Medical groups argue that the fee hikes are justified because treating seniors has grown more complex and time-consuming, both due to new technology and declining health status. The rise in fees may also be a reaction, they say, to years of under-charging, and reflect more accurate billing. The fees are based on a system of billing codes that is structured to make higher payments for treatments that take more time and effort.

But an analysis of Medicare claims from 2001 through 2010 shows that over time, thousands of providers turned to more expensive Medicare billing codes, while spurning use of cheaper ones. They did so despite little evidence that Medicare patients as a whole are older or sicker than in past years, or that the amount of time doctors spent treating them on average was rising.

While it’s impossible to know precisely why doctors and hospitals moved to better-paying codes in recent years, it’s likely that the trend in part reflects “upcoding,” — the practice of charging for more extensive and costly services than delivered, according to Medicare experts, analysis of the data and a review of government audits. And Medicare regulators worry that the coding levels may be accelerating in part because of increased use of electronic health records, which make it easy to create detailed patient files with just a few mouse clicks. Many health policy experts have long believed that billing errors and abuses, from confusion over how to pick proper payment codes to outright overcharges, are common in Medicare. But the Center’s year-long examination has outlined their scope in an unprecedented manner, uncovering a range of costly medical coding mistakes and abuses that have plagued the government-paid health care plan for years and are worsening amid lax federal oversight.

Read more ..

The Edge of Terrorism

Hospitals Failing to Secure Dirty Bomb Materials

September 15th 2012

Cat Scan

Since the September 11 terrorist attacks, Americans have been haunted by the idea that terrorist groups around the world could set off a “dirty bomb” — a simple explosive device that would scatter radioactive material to the winds, devastating a city.

Thankfully, that threat has never materialized. But the government’s watchdog is sounding alarms that terrorists looking to acquire the radioactive materials for such an attack could find them easily and unsecured at hundreds of hospitals around the country.

A report released Tuesday by General Accountability Office has found that only one out of every five hospitals that use high-risk nuclear isotopes for diagnosis and treatment have the recommended safeguards needed to secure the materials. Over 1,500 hospitals in the U.S. use radiological sources that could be turned into dirty bombs, according to the National Nuclear Security Administration (NNSA), which shares purview over nuclear technologies with the Nuclear Regulatory Commission.  NNSA has spent $105 million to upgrade security at 321 hospitals, but the agency warns it will take until 2025 to upgrade all of the hospitals on their list. Read more ..


The Afganistan War

IG: Afghan Fuel Records Go Missing

September 15th 2012

Stryker ICV

What happened to almost $475 million worth of oil destined for the Afghan National Army – that’s what the Special Investigator General for Afghanistan Reconstruction (SIGAR) would like to know.

Unfortunately, the inspectors may never find out.  According to the report released Monday, more than four years of financial records that the Department of Defense was supposed to keep to track this spending are either missing or so poorly kept that even gathering basic information, such as the location and size of fuel sites, was not possible.

The report concludes that the Department of Defense agency in charge of tracking the oil “does not have accurate or supportable information on how much U.S. funds are needed for [Army] fuel, where and how the fuel is actually used, or how much fuel has been lost or stolen.”

Inspectors found that records from October 2006 to March 2011 were shredded improperly, a violation of DOD policies that made it impossible for auditors to track what happened to the hundreds of millions of dollars’ worth of oil.  DOD also “could not provide more than half” of the documents requested from March 2011 onward. Read more ..


The Weapon's Edge

How an 82-Year-Old Exposed Security Lapses at Nuclear Facilities

September 15th 2012

Y-12

The hammering on the wall of America’s premier storage vault for nuclear-weapons grade uranium in pitch-darkness six weeks ago was loud enough to be heard by security guards. But they assumed incorrectly that workmen were making an after-hours repair, and blithely ignored it.

Minutes earlier, a perimeter camera had caught an image of intruders — not workmen — breaching an eight-foot high security fence around the sensitive facility outside Knoxville, Tenn. But the guard operating the camera had missed it. A different camera stationed over another fence — also breached by the intruders — was out of service, a defect the protective force had ignored for 6 months.

In theory, the pounding might have been the work of a squad of terrorists preparing to plant a powerful explosive in the wall of the Highly Enriched Uranium Materials Facility (HEUMF), a half-billion dollar vault that stores the makings of more than 10,000 nuclear bombs. Instead, it was a group of three peace activists, including an 82-year old nun, armed only with flashlights, binoculars, bolt cutters, bread, flowers, a Bible, and several hammers. Read more ..


The Nuclear Edge

Will Egypt Go Nuclear?

September 14th 2012

Nuclear waste overseas

Though Egypt does not currently have a nuclear energy program, that reality could soon change. Newly elected President Mohammed Mursi made clear that Egypt wishes to create a civilian nuclear energy program. Also of concern are statements made by leaders of Mursi’s party, the Muslim Brotherhood, who call for Egypt to pursue a nuclear weapons program. It is presently unclear whether the new president is sincere about his desire for peaceful nuclear energy or if he concurs with his ideological brethren.

Egypt does not currently possess a nuclear energy program, one that could potentially be diverted for weapons purposes. Several factors can be attributed for this reality, including previous leadership priorities, supplier-based constraints, financial difficulties, and safety concerns. Egypt is a member of the Treaty on the Non-Proliferation of Nuclear Weapons and is the leading proponent of establishing a nuclear weapons-free Middle East. This policy, however, may be changing. Egyptian President Mohammed Mursi recently told a group of Egyptian expatriates living in China that “Cairo is considering renewing the Egyptian nuclear program, which will be purely for civilian purposes, to provide clean energy to the citizens of Egypt.” During that trip, Mursi requested $3 billion from the Chinese to build “power plants.” Read more ..


Broken Labor

Fishing Deaths Mount, But Government Slow To Cast Safety Net For Deadliest Industry

August 30th 2012

Fisherman Jumps in Water for Safety Drill
Fisherman Jumps in Water for Safety Drill

Veteran fisherman Fred Mattera stands atop a fishing trawler at the Point Judith Harbor, seagulls squawking by and a fishy mist in the air, and instructs the seven mostly young, tattooed men standing before him to pull on life-safety immersion suits that cover them from foot to head, to zip up and plunge feet first into the water. Then two groups of fishermen interlock like centipedes and take turns paddling backward until they reach a life raft where, going smallest man first, they pull in one by one.

This is survival training, and the plunge-and-rescue dry run is meant to gird the fishermen for the real thing, which comes too often in an industry beset by a high death rate and fragile federal net of protection.

Commercial fishing is the deadliest vocation in the United States. Four years running, from 2007 to 2010, the Bureau of Labor Statistics ranked commercial fishing as the most dangerous occupation in the United States. From 2000 to 2010, the industry’s death rate was 31 times greater than the national workplace average. Read more ..



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