Rising wages in the US do not suggest the country’s jobs market is overheating, the Federal Reserve chairman said, as he defended his careful approach to lifting interest rates.

Jay Powell cited the experience of the 1990s as he argued an acceleration of wage growth need not trigger too much inflation. The link between tight labour markets and inflation has been “greatly reduced”, although not eliminated, in recent decades, he said.

His arguments suggest the Fed will continue to tread carefully as it withdraws its post-crisis stimulus — even as the US economy gathers momentum and financial markets surge.

Last week Mr Powell presided over a third rate rise this year and teed up another one for December, but he insisted his colleagues’ forecasts were pointing to only modestly restrictive policy down the road.

Fed officials have been picking up increasing anecdotal evidence of shortages of available workers as the US unemployment rate hovers at 3.9 per cent, with further declines predicted in the coming months. Wage growth has accelerated to its quickest pace in nine years while the US economy expanded at an annualised pace of more than 4 per cent in the second quarter.

Despite this robust backdrop, the Fed has continued to stick with its “gradual” programme of rate rises while downplaying risks that inflation could get out of hand.

The late 1990s episode of low unemployment saw wages rise faster than inflation plus productivity growth without an appreciable rise in inflation

Mr Powell said in Boston that it was “reasonable” to ask if recent forecasts, which suggest sub-4 per cent unemployment and inflation sticking resolutely close to the Fed’s 2 per cent target, were too good to be true. But he argued that a host of factors, including more credible monetary policy, have muted the so-called Phillips curve, which posits a link between inflation and the unemployment rate.

“This historically rare pairing of steady, low inflation and very low unemployment is testament to the fact that we remain in extraordinary times,” Mr Powell said.

He argued most measures do now point to an economy that is operating with “limited slack”, but he pointed out that those indicators are near levels that prevailed in the late 1990s or early 2000s, when core inflation remained below 2 per cent.

“Our best estimates . . . suggest that so long as inflation expectations remain anchored, a modest steepening of the Phillips curve would be unlikely to cause a significant rise in inflation or demand a disruptive policy tightening,” Mr Powell said.

The Fed chairman said officials are watching a wide array of indicators to assess whether there is a danger of the “revenge of the Phillips curve”, but he suggested those risks are limited. He added that the Fed was ready to “act with authority” if there is any sign of inflation expectations drifting materially up or down.

“The rise in wages is broadly consistent with observed rates of price inflation and labour productivity growth and therefore does not point to an overheating labour market,” Mr Powell said. “Further, higher wage growth alone need not be inflationary. The late 1990s episode of low unemployment saw wages rise faster than inflation plus productivity growth without an appreciable rise in inflation.”

Analysis US interest rates
Fed’s light touch on interest rates may require a firmer hand
Mr Powell’s message chimes with a speech in Jackson Hole, Wyoming, in August, in which he downplayed worries that the US could be overheating and praised the “risk-management” approach of Alan Greenspan, Fed chairman in the 1990s. That period saw the Fed waiting for clear evidence of higher inflation before lifting rates, rather than being overly pre-emptive.

Some of Mr Powell’s Fed colleagues have sounded more anxious about the risks of overheating. Eric Rosengren, the Boston Fed president, told the Financial Times last month that financial stability could be threatened if the Fed keeps borrowing costs too low and allows an overheating jobs market to encourage excessive risk-taking. He noted that past “boom-bust cycles” in the labour market had ended badly in the US.

Federal Reserve VP Describes The Limits Of Cryptocurrency Partnerships

To help kick off the two-day event, Jim Cunha, vice president of treasury and financial services at the Boston Fed, joined cryptocurrency leaders from around the industry to talk about the influence blockchain is having on the way people think about money, and how to make it.

In the course of a 20-minute conversation, Cunha detailed some of the early-stage blockchain experiments a few members of his team of 200 have undertaken using ethereum and Hyperledger Fabric. Cunha also explained how the branch of the U.S. central bank interacts with other currency issuers and startups to learn more about how blockchain works.

But the biggest obstacle Cunha says central banks face when it comes to embracing the speed and borderlessness of blockchain isn’t technological. Rather, the 30-year veteran of the Federal Reserve says that it's uncertainty about the security of the organizations building blockchain that has him most concerned.

“We use private companies all the time,” said Cunha, who has been at the central bank for more than 30 years. “I don’t know if we’ll ever do that with cryptocurrency.”

Many developers in the open-source blockchain ecosystem have opted to remain pseudonymous, and scams involving the technology have proved to be a successful way to make money on the technology. But for now Cunha is wasting no time exploring the technology from inside.

He mentioned several other projects, including the Monetary Authority of Singapore’s Project Ubin and Clearmatics Technology's Utility Settlement Coin, as examples of how central banks are being influenced by the cryptocurrency world.

In spite of Cunha's cautious take on how third-party cryptocurrency companies might directly partner with central banks, he also listed multiple central bank efforts, including work being done in Sweden, as examples of what he believes could someday result in a state-controlled fiat currency issued on a blockchain.

“I give it five years,” Cunha said.

At first glance, the issuance of a cryptocrrency with some of the price controls implemented by central banks may seem like a lot of unnecessary work to fix a system that works pretty well for many people as is. But another speaker at the event, Circle Internet Financial founder Jeremy Allaire, thinks the integration of crypto and fiat could lay the groundwork for new kinds of markets.

Last week Allaire formally launched USD Coin, a cryptocurrency powered by the public ethereum blockchain and backed by the U.S. dollar. Allaire argued that by backing the tokens with a more stable currency, he could first enable off-hours trading and eventually jump-start trading between markets around the world that are normally isolated.

Lending support to Cunha’s concerns, however, was a panel on how to fix cryptocurrency’s broken reputation. Speakers including Jalak Jobanputra, founder Future Perfect Ventures, Yin Wu, founder of Dirt Protocol, and Will Warren, co-founder of 0X, talked about how the run up in the price of many cryptocurrencies in 2017 and a proliferation of poorly vetted projects led to a resurgence of skepticism.

But to hedge such concerns, the panelists also reflected on distrust they see in the traditional financial sector, especially among Millennials. While Allaire sought to earn that trust by integrating the new technology with some of the old stability, panelists on a second panel focused on other possible solutions.

Speaking on a panel about whether crytpocurrency would ever make a viable means of exchange, Neha Narula, MIT’s director of digital currency, joined Tadge Dryja, a co-creator of the Lightning Network for speeding up bitcoin transactions, and Linda Xie, the founder of crypto-token venture capital firm Scalar Capital, to argue that new technology, not traditional currency, was the best way to widespread use.

One thing the speakers all had in common though was a focus on reimagining what monetary systems can look like from the ground up.

Meltem Demirors, the chief strategy officer of London-based crypto investment research firm CoinShares, proposed considering unconventional variables of a monetary system such as fairness, social access and equality of the system when imagining new ways to move money.

“We now have to work together to define the future of who has the right to print money and who has the right to define for us individually and collectively what has value,” Demirors concluded.

Israel Considers Batman Cryptocurrency to Fight Crime

In an effort to crack down on money laundering and tax evasion, the Israeli government may soon launch a state-supported cryptocurrency. Additionally, other factors indicate that the time is right for a crypto-shekel coin. Israel is in the midst of a cryptocurrency boom, fueled by the country's high tech sector and its cutting-edge blockchain research.

The crypto-shekel movement has been advanced by the finance ministry and Israel's central bank. Rumors are that the value of the digital currency would be pegged to the physical shekel. And every transaction would be recorded to a mobile phone, permitting quicker transactions.

At present, it's estimated that 22 percent of Israel's GDP is composed of deals that are off the books, cash-on-the-barrelhead payments and sordid criminal activities. A couple of recent incidents may provide the impetus to launch Israel's state-sponsored cryptocurrency.

Hebron's cybercrime division recently handed down an indictment in Israel against Hilmi Git, alleging that Git laundered more than $8 million through Bitcoin transactions. About 1,000 Bitcoins were seized. Prosecutors warn that the Git indictment is but the tip of the iceberg, involving a sophisticated gang of cyber-criminals using credit cards and identity theft to launder millions.

Git was quite bold and ran a website that included instructions on stealing credit cards and how to conceal the theft of money. Prosecutors even quoted Git as stating that he would steal money from "wherever I can."

The Git case is significant because the seizure of Bitcoins marks the first time that Israeli officials seized a cryptocurrency in a criminal case. Governments have discovered that Bitcoins are the preferred choice of criminals to launder money. Thus, the case is providing impetus to launch a crypto-shekel.

Another case involved Bank Hapoalim. The bank is under investigation by the US Department of Justice for assisting American citizens in evading taxes. The bank told shareholders earlier this year that it had set aside another $75 million to meet a possible settlement with the justice department. That brought the total settlement sum to $343 million thus far. The bank warned shareholders that the amount could climb higher.

Bank Leumi has already paid a $400 million settlement to the US Justice Department for aiding tax evasion.

The Bank of Israel has been lobbying Israeli lawmakers to tighten up the anti-money laundering laws. The central bank believes these laws will also hinder terrorist financing.

Others in the digital cash movement make the argument that private companies should launch a cryptocurrency because these companies are well versed in the nuances of bitcoins and the blockchain it operates on.

Bank of Hapoalim recently struck a deal with Microsoft to handle digital cash via blockchain and the Azure cloud. In another action that bolsters the argument for a private sector cryptocurrency, the Supreme Court of Israel recently shot down Bank Leumi for trying to close accounts that transacted business in cryptocurrencies. Both of these actions speak well for creating a cryptocurrency in the private sector.

It's important to realize that creating and controlling cryptocurrencies is attractive to countries because sovereign nations could take a bite from the cryptocurrency apple in every transaction. Sovereign nations could also require cryptocurrency exchanges to report large deposits. This control and additional state revenue will inspire nations to fight hard to create cryptocurrencies.

The time appears right for Israel to launch a state-sponsored cryptocurrency. The country's high tech sector is hitting on all cylinders, and creating an Israeli digital coin will add fuel to the tank. A cryptocurrency launch could also bring to heel the criminal gangs who are feasting off the vulnerabilities of the unregulated bitcoin market.

AmerisourceBergen to pay $625 million in U.S. civil fraud settlement

AmerisourceBergen Corp, one of the largest U.S. drug wholesalers, will pay $625 million to resolve civil fraud charges over the sale of syringes containing drugs for cancer patients, double billing, and providing kickbacks to doctors.

The settlement announced on Monday by the U.S. Department of Justice boosts AmerisourceBergen’s total payout to $885 million over its repackaging and distribution of pre-filled syringes that were not approved by the U.S. Food and Drug Administration.

In September 2017, the company’s AmerisourceBergen Specialty Group unit pleaded guilty to a related misdemeanor, and paid $260 million of criminal fines and forfeitures.

The Chesterbrook, Pennsylvania-based company also entered a five-year corporate integrity agreement to ensure compliance with federal health care rules. It set aside money for the entire civil settlement in its fiscal year ended Sept. 30, 2017.

AmerisourceBergen admitted that from January 2001 to January 2014, its Medical Initiatives Inc pharmacy unit in Alabama shipped millions of syringes for patients undergoing chemotherapy that contained drugs prepared in an unsterile environment.

Authorities said AmerisourceBergen would harvest “overfill” from the original vials of such drugs as Aloxi, Anzemet, Kytril and generic Kytril, Neupogen and Procrit used to combat side effects of chemotherapy, such as nausea and anemia.

That enabled the company to create more doses than it bought, and generate at least $99.6 million of extra profit, authorities said.

AmerisourceBergen was also accused of billing multiple doctors for individual vials, causing them to bill the government more than once, and paying kickbacks to induce doctors to buy drugs through the pre-filled syringe program.

“ABC placed corporate profits over patients’ needs, endangering the health of vulnerable cancer patients,” U.S. Attorney Richard Donoghue in Brooklyn, New York said in a statement.

New York Attorney General Barbara Underwood said $99.9 million of the payout will go to state Medicaid programs.

Four whistleblowers including Michael Mullen, a former chief operating officer at AmerisourceBergen Specialty Group, will share $99 million from the payout, lawyers for Mullen said.

AmerisourceBergen said in a statement that the settlement reflects its acknowledgment that some practices at the now-closed Medical Initiatives unit “were not consistent with AmerisourceBergen’s approach to corporate compliance.”

The company’s shares rose 57 cents to $92.79 on Monday.

Web Founder Launches Radical Startup to Take Back the Internet from Google & Facebook

“For people who want to make sure the Web serves humanity, we have to concern ourselves with what people are building on top of it,” Tim Berners-Lee told Vanity Fair last month. “I was devastated” he said while going through a litany of harmful and dangerous developments of the past three decades of the web.

That’s why “the Father of the World Wide Web” has launched a start-up that intends to end the dominance of Facebook, Google, and Amazon, while in the process letting individuals take back control of their own data.

Berners-Lee’s new online platform and company Inrupt is being described as a “personal online data store,” or pod, where everything from messages, music, contacts or other personal data will be stored in one place overseen by the user instead of an array of platforms and apps run by corporations seeking to profit off personal information. The project seeks “personal empowerment through data” and aims to “take back” the web, according to company statements.

The man who created the world wide web by implementing the first ever successful communication between a Hypertext Transfer Protocol (HTTP) client and server via the internet in 1989 lamented that his creation has been abused by powerful entities for everything mass surveillance to fake news to psychological manipulation to corporations commodifying individuals’ information.

But he’s long been at work on a new project to take the web back, described in depth by the business technology magazine Fast Company:

This week, Berners-Lee will launch, Inrupt, a startup that he has been building, in stealth mode, for the past nine months. Backed by Glasswing Ventures, its mission is to turbocharge a broader movement afoot, among developers around the world, to decentralize the web and take back power from the forces that have profited from centralizing it. In other words, it’s game on for Facebook, Google, Amazon.

“We have to do it now,” Berners-Lee said of the newly launched project. “It’s a historical moment.” He identified the main impetus behind his recent announcement that he’ll be going on sabbatical from his research professor post at MIT to work full-time on the project as the recent revelation that Facebook allowed political operatives to gain access to some 50 million users’ private data.

At MIT Berners-Lee has for years led a team on designing and building a decentralized web platform called ‘Solid’ — which will underlie the Inrupt platform. The Inrupt venture will serve as users’ first access to the new Solid decentralized web:

If all goes as planned, Inrupt will be to Solid what Netscape once was for many first-time users of the web: an easy way in. And like with Netscape, Berners-Lee hopes Inrupt will be just the first of many companies to emerge from Solid.

“I have been imagining this for a very long time,” says Berners-Lee.

As described on the Solid and Inrupt websites the new platform will allow users to have complete control over their information ‘pods’ (an acronym for “personal online data store”) — it is only they who will decide whether outside apps and sites will be granted access to it, and to what extent.

Unlike Facebook or Twitter where all user information ultimately resides in centralized data centers and servers under control of the companies, applications on Inrupt will compete for users based on the services they can offer, and only the users can grant these apps “views” into their data, making personal data instantly portable between similar applications.

“The main enhancement is that the web becomes a collaborative read-write space, passing control from owners of a server, to the users of that system. The Solid specification provides this functionality,” the Solid website says.

Berners-Lee explained to Fast Company one example currently under development that could radically changed a popular product that has been prone to overstepping privacy boundaries and compromising data:

For example, one idea Berners-Lee is currently working on is a way to create a decentralized version of Alexa, Amazon’s increasingly ubiquitous digital assistant. He calls it Charlie. Unlike with Alexa, on Charlie people would own all their data. That means they could trust Charlie with, for example, health records, children’s school events, or financial records. That is the kind of machine Berners-Lee hopes will spring up all over Solid to flip the power dynamics of the web from corporation to individuals.

With the weekend launch of Inrupt, developers across the globe this week will be invited to begin building their own decentralized apps through the Inrupt site. As its popularity grows the company will move forward to raise more funds, though it’s currently backed by a venture capital firm.

Yet as his latest interview notes, “his plans could impact billion-dollar business models that profit off of control over data. It’s not likely that the big powers of the web will give up control without a fight.”

When this major potential disruptor was noted, Berners-Lee shot back: “We are not talking to Facebook and Google about whether or not to introduce a complete change where all their business models are completely upended overnight. We are not asking their permission.”

The Federal Reserve Board has approved actions on Thursday by the Boards of Directors of the Federal Reserve Banks of New York and Minneapolis, increasing the discount rate (the primary credit rate) at the Banks from 2-1/2 percent to 2-3/4 percent, effective immediately.

FINRA Files to Update CAB Rule
This is the second rule amendment FINRA has issued to conform with FinCEN's customer due diligence requirements.

FINRA building in New York. FINRA building in New York.
The Financial Industry Regulatory Authority filed another proposed rule change with the Securities and Exchange Commission to amend its Capital Acquisition Broker (CAB) rule, Rule 331, to reflect the Treasury Department’s Financial Crimes Enforcement Network’s (FinCEN) adoption of a final rule on customer due diligence requirements for financial institutions.
This is the second rule amendment FINRA has issued to conform with FinCEN’s rule, which became effective on May 14.

The broker-dealer self-regulator amended Rule 3310, its Anti-Money Laundering Compliance Program rule, in May to reflect FinCEN’s adoption of its final CDD rule.
Regulatory Notice 18-19 alerted broker-dealers to ensure that their AML programs are updated, and applied to FINRA members that have not elected CAB status.

The new rule filing adds the CDD requirements to the CAB anti-money laundering rule.

Since CABs are subject to a separate rule set, FINRA needed to make an additional rule filing to conform the CAB anti-money laundering rule to FinCEN’s CDD requirements.
FINRA’s proposed amendments would require CABs’ anti-money laundering compliance programs to include risk-based procedures for conducting ongoing customer due diligence.

The ongoing customer due diligence element for AML programs includes understanding the nature and purpose of customer relationships for the purpose of developing a customer risk profile; conducting ongoing monitoring to identify and report suspicious transactions; and, on a risk basis, maintaining and updating customer information, according to FINRA.

Treasury’s FinCEN, which is responsible for administering the Bank Secrecy Act and its implementing regulations, issued the CDD Rule on May 11, 2016, to “clarify and strengthen customer due diligence for covered financial institutions, including broker-dealers.”

As Venezuelans go hungry, Trump targets food corruption
In this July 6, 2018 photo, employees of a government-supported cultural center receive boxes with subsided food distributed under a government program named "CLAP" in downtown Caracas, Venezuela. Some workers transfer the contents, cooking oil, flou
In this July 6, 2018 photo, employees of a government-supported cultural center receive boxes with subsided food distributed under a government program named "CLAP" in downtown Caracas, Venezuela. Some workers transfer the contents, cooking oil, flour, rice, canned tuna, to suitcases or backpacks for fear of becoming walking targets. (AP Photo/Fernando Llano)more +

The June meeting was conducted behind closed doors far from the klieg-light attention normally focused on Venezuela.

Around a U-shaped table in a hotel towering above the Panama Canal, U.S. Treasury Department officials distributed a list of suspected shell companies that they believe senior Venezuelan officials have used across the globe to siphon off millions of dollars from food import contracts amid widespread starvation in the oil-rich nation.

The two-day meeting, and several others that have taken place since April, are part of a sustained campaign by the Trump administration to pressure President Nicolas Maduro by striking at the wallets of the top officials in his socialist administration.

"They know we're after them, and they know we're after them on a multinational basis because we're beginning to see the networks morph and new shell companies stand up and existing ones wound down," Marshall Billingslea, the assistant Treasury secretary for terrorist financing, said in an interview on the sidelines of the meeting.

At that gathering, financial forensic investigators from the U.S. and three conservative Latin American allies — Mexico, Panama and Colombia — traced transactions by companies believed to be controlled by a government-connected businessman, according to several participants who spoke to The Associated Press on the condition of anonymity because the deliberations were private.

Since Donald Trump became president, dozens of senior Venezuelan officials, including Maduro himself, have been sanctioned by the Treasury Department over allegations of corruption, human rights abuses and drug trafficking.

Last year, Trump even threatened a "military option" to remove Maduro and, with senior aides and Latin American leaders, raised the possibility of invading the South American country. As the country's economic troubles mount, he has sought to rally regional pressure as well.

The focus on food is deliberate, said Billingslea, a key driver of U.S. policy toward Venezuela who led Trump's national security transition team.

A story published by the AP in 2016 revealed how senior Venezuelan officials and members of the military were enriching themselves by diverting money from food contracts. Since then, as hunger has spread, Maduro has moved to assert even greater control over food distribution, handing out monthly boxes of staples that critics label a form of dictatorial social control.

Maduro said he began distributing the so-called CLAP boxes — a Spanish acronym for Local Committees for Supply and Production — as a way to circumvent the "economic war" being waged by the U.S. and opponents seeking to oust him from power.

As Venezuela has fallen deeper into political and economic turmoil, the CLAP program has become a tenuous lifeline for millions of citizens suffering due to barren supermarket shelves and hyperinflation estimated by the International Monetary Fund to soon reach 1 million percent.

Critics say Maduro has essentially weaponized food, distributing the boxes primarily to government workers and supporters. According to an April survey by the local pollster Datanalisis, more than 60 percent of Venezuelan households said they received CLAP box in the previous three months — about the same percentage that helped re-elect the embattled leader in May presidential elections boycotted by the opposition.

The allegations are fueling calls from Latin American leaders, including the heads of Argentina, Colombia and Chile, for Maduro to be tried in an international court for crimes against humanity.

"This goes beyond just corruption," said Billingslea, who led the U.S. delegation to Panama with Kenneth Blanco, the director of the Treasury Department's financial crimes enforcement network. "This is literally looting the one social safety-net program left in Venezuela."

On a recent weeknight, word quickly spread among employees of a government-supported cultural center about the downtown Caracas location where they could collect their monthly CLAP ration. Within a few hours, everyone from museum curators to janitors waited in line to sign a clipboard before government loyalists slid a box across the table.

Once outside, some workers tore open the boxes, transferring the contents — cooking oil, flour, rice, canned tuna — to backpacks for fear of becoming walking targets in one of Latin America's most violent cities. Some said they planned to resell the food on the black market, where a single bag of sugar can easily fetch more than 100 times the heavily subsidized price of the entire CLAP box.

"When the food boxes first came out, we used to get a kilogram of meat or chicken, but we never saw that again," said Marcos Inojosa, an electrical technician who has been receiving the handout for about a year. "The president turns a blind eye and pretends that everything is working well. But everything is in the dumps."

Among those under scrutiny by the coalition of countries is an obscure Colombian businessman who struck gold selling to Maduro's government.

Alex Saab, from the Caribbean city of Barranquilla, was a major focus of the closed-door meetings in Panama City, the participants who spoke on condition of anonymity told the AP. At one point they even studied the movements of a U.S.-registered private jet to identify his current whereabouts: Caracas, Paris, or Lebanon.

Saab gained some prominence in 2011 after signing an agreement to build social housing for the Venezuelan government on behalf of a Colombia-based construction company. He appeared on Venezuelan state television alongside Maduro, the late President Hugo Chavez and then-Colombian President Juan Manuel Santos.

Investigators say Saab entered the food business through a Hong Kong-based company, Group Grand Ltd., which they say bears the hallmarks of a shell company, including no known track record in the food business, a rudimentary webpage that is now inaccessible and an address in Caracas shared with Saab's construction company.

Group Grand has been awarded contracts to provide at least 11.5 million CLAP boxes, according to a Venezuelan Food Ministry spreadsheet obtained by the AP.

Luisa Ortega, who was ousted as Venezuela's chief prosecutor and exiled last year after breaking with Maduro, has called for an investigation into Saab, alleging — so far without evidence — that he and Group Grand are fronts for Maduro

Billingslea would not discuss specific individuals or entities on the task force's radar, but said going after what he believes is money stolen from food imports by Maduro and first lady Cilia Flores is a top priority.

Prosecutors in both Miami and Colombia have been investigating Saab for more than a year, four U.S. and Colombian officials with knowledge of those investigations told the AP. All spoke on the condition of anonymity because of the sensitive political nature of the ongoing probe.

Saab's Miami-based lawyer, Richard Diaz, rejected allegations of any wrongdoing, saying that Saab has been subjected to undue scrutiny and harsh media coverage because of false testimony leveled against him. He said that if the U.S. had cause to believe the allegations were possibly true, his client would have been charged long ago.

Saab said in a statement that he is being targeted by government opponents looking to sabotage the economy.

"Instead, they should be thankful that despite so much bad press and international blockade there are still businessmen willing to invest and believe in the country," he said.

The U.S. Treasury estimates that at least 70 percent of the CLAP program is being gutted by corruption, citing evidence of overbilling.

Among the transactions that have raised red flags is a September 2017 invoice presented to Venezuela's food ministry by Group Grand for $41 million worth of powdered milk at a price of $6,950 per metric ton, or more than double the market price at the time. A copy of the invoice was provided to the AP.

"Never have we seen prices that high, not even in times of crisis," said Roger Figueroa, president of the Venezuelan dairy industry's lobby group.

A study conducted by Figueroa's group also found that the powdered milk distributed in the CLAP boxes regularly contained a third of government-mandated protein levels and twice the level of recommended carbohydrates.

The investigative cooperation between the U.S. and other countries began about a year ago at the urging of Trump officials, and already has yielded some results.

On May 17, three days before Maduro was re-elected, then-Colombian President Santos, acting on information provided by the U.S., announced the seizure of 15 shipping containers filled with more than 25,000 CLAP boxes stamped with Chavez's image and containing beetle-infested rice and other spoiled food.

In testimony to police obtained by the AP, the owner of a Colombian company said he was hired by another firm to assemble and ship the boxes to Venezuela's Corporation of Foreign Trade, or Corpovex, which had for years been under the stewardship of an air force general.

A U.S. Treasury advisory last year warned American banks about the risks of doing business with Venezuelan clients, citing Corpovex as a vehicle frequently used by corrupt officials for embezzling state funds through shell companies.

The seized CLAP shipment, which was valued at over $500,000, was never sent. It spoiled sitting on the docks because the firm that ordered it, a Portuguese company called Agrovarius, said its bank accounts had been frozen and it could not pay its bills, according to the police testimony.

Little is known about Agrovarius, which is located behind a high white wall in a Lisbon suburb. One of the company's listed owners, Joao Rosa, denied having anything to do with the Colombian shipment and insisted all the company's vendors had been paid.

Agrovarius also was implicated in what has come to be called the so-called pork revolution, which took place last Christmas when angry Venezuelans took to the streets when Maduro failed to deliver on a promise to provide thousands of free hams to poor neighborhoods.

Maduro accused Portugal's government of "sabotaging" the holiday gift, but the long-established Portuguese meatpacker Raporal pinned the blame on Agrovarius, saying it was never paid the more than 6 million euros needed to supply Venezuela's government with the meat.

A spokesman for Raporal said the company is now suing Agrovarius for breach of contract. Rosa said Agrovarius had nothing to do with the botched Christmas ham shipment.

Billingslea, meanwhile, said that Maduro has repeatedly sought to deflect blame for his own mismanagement and refusal to address mounting hunger.

"If they really wanted to feed people, they'd let in the foreign aid that's been offered," he said.

German watchdog calls for Deutsche Bank to crack down on money laundering

Deutsche Bank has previously been hit with fines over failures in its anti-money laundering efforts (Source: Getty)
Germany’s financial regulator, BaFin, has called on sector giant Deutsche Bank (DB) to take action against money laundering and terrorist financing, appointing a special auditor to monitor its progress.

In a statement, BaFin called on the bank to adopt “appropriate internal safeguards” and “comply with general due diligence obligations”. It said it had appointed a “special representative” to “report on the implementation progress and evaluate it”.

It is the first time a special auditor has been appointed to monitor a German lender. BaFin’s statement did not contain additional information about the timeframe for the process.

EU and state regulators monitor and develop legislation to try and prevent bank services being used for illegal activities, of which money laundering a terrorism financing are the most prominent. Know your customer (KYC) regulations are used by banks to verify customers as a measure against fraud and have become a core part of global anti-money laundering practices.

In August, Reuters reported that DB had uncovered shortcomings in its ability to fully identify clients and the source of their wealth, citing internal documents. In January 2017, the bank agreed to pay US and UK regulators $630m (£479.7m) over artificial trades that had been used to launder $10bn out of Russia. It was hit with a further $41m fine from the US Federal Reserve later that year over failings in its money-laundering detection services.

In a statement, DB said: “We have the strong commitment to operate within regulatory compliant practices for the identification of our clients (KYC). We are in agreement with the BaFin that we have to improve these processes in the Corporate & Investment Bank further. The bank will work together with the BaFin and the special auditor KPMG to fulfill the regulatory requirements as soon as possible and within the given time frame."

Nineteen people were arrested for allegedly distributing meth in the Waco area.

The Department of Justice said Thursday that nineteen people were arrested for their alleged involvement in the distribution of methamphetamine in the area.

Officials said that the suspects were believed to be responsible for the local distribution of large amounts of meth. They were all charged with conspiracy to possess with intent to distribute.

Nine pounds of meth were seized during the investigation.

The Waco police, DEA, FBI, Texas Department of Public Safety, U.S. Marshal's Service and the McLennan County Sheriff's Office all assisted in the investigation and arrest.

The following individuals were arrested:

Rene Lopez, 42
Peter Nino, 34
Brandon Stout, 34
Lloyd Gatlin, 44
Justin Hernandez, 31
Cruz Oviedo, 26
Kyle Baker, 33
Juli Aleman, 41
Devito Dembinsky, 30
Benito Rodriguez, 37
Decedreon Miller, 38
Ricky Rivera, 43
Julian Rivera, 39
Shauna Gilstrap, 39
James McMillion, 54
Brent May, 55
Sandra Oviedo, 25
Jesus Lopez, 41
Nicholas Caufield, 43

U.S. Blockade Stalks Cuba Worldwide

United Nations, Sep 22. -The U.S. blockade to Cuba lurks today on anywhere in the world, warned the island's diplomatic mission to the UN in a press release, in which it exposes numerous financial obstacles.

For example, on February 12th, 2018, it was announced that five Indian banks refused to make a transfer from the United Nations Development Program (UNDP) office in Cuba to Ankur Scientific Energy Technologies LTD because of blockade regulations.

Also the same month, the Malaysian subsidiary of the U.S. Company ADT received instructions from its head office to refuse to renew the contract for security services to the Cuban embassy in that country, because the island is a territory under U.S. sanctions, according to the text.

In June 2017, the Office of Foreign Assets Control (OFAC) imposed a fine of 87,255 dollars on the American Honda Finance Corporation, due to the fact that one of its subsidiaries in Canada approved and financed 13 car leasing agreements between the Cuban embassy in that country and a Honda concessionaire in Ottawa.

Also, the press release states that OFAC prohibited in September 2017 a donation of medicines to the NGO 'Caritas in Cuba', because the ship carrying the cargo belonged to the U.S. Company Norwegian Cruise Line Holdings Ltd.

Later, in November, OFAC fined BCC Corporate S.A., a Belgian subsidiary of the US Company Alpha Card Group, 291,825 dollars for selling credit cards from 2009 to 2014 used to make purchases in Cuba.

On December 27th, 2017, the Inter-American Development Bank blocked funds for an academic agreement between Cuba and the Polytechnic School of Chimborazo, Ecuador, also due to the U.S. blockade.

So far, the U.S. blockade is the most unjust, severe and prolonged system of unilateral sanctions applied against any country, since it was instituted on February 3rd, 1962, by John F. Kennedy, the 35th president of the United States.

In November 2017, the U.S. Departments of Commerce, Treasury and State issued new regulations and provisions to strengthen the extraterritorial application of the blockade and intensify the persecution of financial transactions and banking-credit operations with Cuba on a global scale

Baltimore And Texas Men Indicted For Alleged $364 Million Ponzi Scheme—One Of The Largest Ever Charged In Maryland
Scheme Believed to Have Over 400 Victims Nationwide, Including Individual, Family Offices, and Investment Groups – FBI Seeking Information Regarding Additional Victims; SEC has Filed Related Civil Complaint
Baltimore, Maryland – A federal grand jury has indicted three men on charges of conspiracy, wire fraud, identity theft, and money laundering, arising from an alleged $364 million investment fraud scheme. The indictment was returned under seal on September 11, 2018, and unsealed on September 18, 2018, upon the arrests of the defendants. Charged in the indictment are:

Kevin B. Merrill, age 53, of Towson, Maryland;

Jay B. Ledford, age 54, of Westlake, Texas and Las Vegas, Nevada; and

Cameron R. Jezierski, age 28, of Fort Worth, Texas.

The indictment was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Gordon B. Johnson of the Federal Bureau of Investigation, Baltimore Field Office. A related enforcement action and complaint was announced by the U.S. Securities and Exchange Commission Co-Director of Enforcement Stephanie Avakian.

“Federal prosecutors, FBI agents, and our SEC partners together interrupted an ongoing fraud scheme, with the potential to victimize even more people. According to the indictment, the defendants lured investors through an elaborate web of lies, duping them into paying millions of dollars into this Ponzi scheme,” said U.S. Attorney Robert K. Hur. “Most of these investors are just learning that they have been victimized. The effects of this kind of fraud can be devastating. We urge anyone who thinks they may be a victim to contact the FBI at MerrillLedford@fbi.gov (link sends e-mail).”

“The FBI takes our responsibility to investigate and pursue those who commit fraud for personal gain very seriously,” said Special Agent in Charge Gordon B. Johnson of the FBI’s Baltimore Division. “We will continue working with our law enforcement partners to hold accountable those who use illegal means and criminal behavior to take advantage of others. We are committed to protecting investors from the illegal and deceptive practices Mr. Merrill and Ledford used to defraud investors out of their hard earned money and savings.”

According to the fourteen-count indictment, beginning in January 2013, the defendants perpetrated a Ponzi scheme to defraud investors of more than $364 million. The scheme was revealed with the arrests and unsealing of the indictment. Specifically, the indictment alleges that Merrill and Ledford invited investors to join them in purchasing consumer debt portfolios. “Consumer debt portfolios” are defaulted consumer debts to banks/credit card issuers, student loan lenders, and car/truck financers which are sold in batches called “portfolios” to third parties which attempt to collect on the debts. The defendants falsely represented to investors that they would use the investors’ money to buy consumer debt portfolios and make money for them by (1) collecting the payments that people made on their debts or (2) selling the portfolios for a profit to third party debt buyers--in a practice called “flipping.” According to the related complaint filed by the SEC, the victim investors included small business owners, restauranteurs, construction contractors, retirees, doctors, lawyers, accountants, bankers, talent agents, professional athletes, and financial advisors, located in Maryland, Washington, D.C., Northern Virginia, Las Vegas, Texas, and elsewhere.

The indictment alleges that in order to induce investors to participate, the defendants falsely represented who they were buying the debt portfolios from and how much they were paying for the portfolios; whether they were investing their own funds, and their track record of success. At times, according to the indictment, there was no underlying debt portfolio purchased with the investors’ money. To conceal the truth, the defendants created imposter companies with names similar to actual consumer debt sellers or brokers and opened bank accounts in the names of those imposter companies. In addition, to lend credibility to the transactions, the defendants created false portfolio overviews, sales agreements which used the names and forged signatures of actual employees of the sellers, created false collections reports, and falsified bank wire transfer records and bank statements.

Further, the indictment alleges that the defendants falsely represented that the monies they paid to investors were “proceeds” from collections and/or flipping debt portfolios, when in fact, the proceeds were paid from funds provided by other investors. The indictment alleges that Merrill, Ledford, and Jezierski personally enriched themselves and concealed their diversion of $73 million of investors’ funds to purchase and renovate high end homes in Maryland, Texas, Nevada, and Florida, purchase luxury automobiles, jewelry, boats, and a share in a jet plane, gamble $25 million at casinos, and support a lavish lifestyle.

The indictment seeks to forfeit nine properties, 26 luxury cars, one boat, interest in an aircraft, a life insurance policy, seven and nine carat diamond rings, and a 23 carat diamond bracelet, which were allegedly purchased with proceeds of the scheme to defraud.

If convicted, Merrill, Ledford, and Jezierski each face a maximum of 20 years in prison for the wire fraud conspiracy and for each of five counts of wire fraud. Merrill and Ledford each also face 20 years in prison for an additional two counts of wire fraud, as well as 20 years in prison for a money laundering conspiracy, and for each of four counts of money laundering. Finally, Merrill and Ledford face a mandatory two years in prison, consecutive to any other sentence, for identity theft. The defendants also face possible fines of $250,000, or twice the gross gain, for the wire fraud conspiracy and for each count of wire fraud and money laundering. Merrill and Ledford face an additional fine of $500,000, or twice the value of the property, for the money laundering conspiracy.

The SEC has filed a parallel civil complaint in this matter.

If you believe you may have been a victim, or have information concerning these charges, please email MerrillLedford@fbi.gov (link sends e-mail) and complete a brief questionnaire. Your responses are voluntary. You may be contacted by the FBI

An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.

Merrill and Ledford each had an initial appearance in U.S. District Court in Baltimore and Las Vegas, respectively, on September 18, 2018, and were ordered to be detained. Jezierski also had his initial appearance in Las Vegas and was released under the supervision of U.S. Pretrial Services. Merrill is scheduled to have a detention hearing on Thursday, September 20th at 3:30 p.m. Jezierski is expected to have his initial appearance in Maryland on September 24, 2018, and Ledford is expected to be brought to Maryland for a court appearance at a later date.

United States Attorney Robert K. Hur commended the FBI in Baltimore, Dallas, Las Vegas and Tampa, and the Federal Housing Finance Agency, Office of the Inspector General for their work in this investigation. Mr. Hur thanked Assistant U.S. Attorneys Joyce K. McDonald and Martin J. Clarke, who are prosecuting the criminal case.

Why the FBI Mysteriously Closed That New Mexico Observatory
An observatory in New Mexico was mysteriously closed this month while the FBI investigated and now we know why. No, it wasn't aliens.

For the past two weeks, an observatory in New Mexico has drawn worldwide attention, but not because of its research. Since September 6, the Sunspot Solar Observatory has been closed and evacuated for mysterious reasons, with FBI agents and a Blackhawk helicopter seen patrolling the site.

Both the FBI and the agency that manages the observatory, the Association of Universities for Research in Astronomy (AURA), refused to comment on the nature of the shutdown at the time, beyond saying it was a "security issue." Due to the scientific nature of the facility, speculation ranged from the first detection of alien life to some covert operation.

Finally, AURA has released a statement clarifying, in part, the reason for the closure. And while it's less exciting than the most outlandish theories, at least it's an answer. According to the organization, the observatory was closed due to “criminal activity” on the premises. From a press release:

“AURA has been cooperating with an on-going law enforcement investigation of criminal activity that occurred at Sacramento Peak. During this time, we became concerned that a suspect in the investigation potentially posed a threat to the safety of local staff and residents. For this reason, AURA temporarily vacated the facility and ceased science activities at this location.”

AURA also gives an answer for why it was so tight-lipped, even though no aliens were involved:

“We recognize that the lack of communications while the facility was vacated was concerning and frustrating for some. However, our desire to provide additional information had to be balanced against the risk that, if spread at the time, the news would alert the suspect and impede the law enforcement investigation. That was a risk we could not take.”

According to the release, the emergency is over and the observatory is re-opening later this week.

According to the Federal Reserve's G.19 Consumer Credit report, America's outstanding revolving debt – mostly credit card debt – was closing in on $1.04 trillion as of June 2018. How will we pay all that money back? An increasing number of Americans may not be able to do so.

ValuePenguin analyst Joe Resendiz calls credit card defaults "a cause for concern." Resendiz highlighted increased second-quarter credit card default numbers for both JPMorgan and Bank of America as disturbing points amid generally good reports.

The second quarter 2018 Household Debt and Credit Report from the New York Federal Reserve backs up some of these concerns. At 6% of all consumer debt, credit card debt remains firmly in third place for all non-mortgage consumer debt behind student loans (11%) and auto loans (9%). However, the sheer number of credit card accounts – approximately 480 million, over four times the number of auto loan accounts and over five times the number of mortgage loans – provides an opportunity for the default numbers to rise.

Defaults are well below the 2009 peak, when 6.77% of credit cards were in default and over 13% of credit card balances were delinquent by ninety days or more. Credit card defaults in the second quarter of 2018 decreased slightly, from 2.54% in the first quarter to 2.47%. However, Federal Reserve data shows the default rate has been on a slow increase since the 2.12% trough in the first two quarters of 2015.

Consider that the credit card default rate is rising during an economic recovery. What will happen when the economy eventually contracts?

Consumer spending has been robust, but with wages staying relatively flat, it's possible that too many Americans are displaying their optimism by increasing their spending on credit – charging more than they can realistically afford to pay.

It's insightful to compare the delinquencies transition rates in different types of consumer debt. New York Fed data shows that the percentage of credit card account balances with missed payments (over thirty days delinquent) rose sharply in the second half of 2016 and stayed above 6% of balances while other forms of delinquencies (mortgages, auto loans, student loans, and home equity loans) stayed flat or decreased slightly.

The same pattern follows into ninety-day delinquencies and above, with credit cards rising in late 2016 and remaining at higher levels. Perhaps our economic boom is riding on excessive use of credit.

ValuePenguin calculated the average credit card debt at $9,333 for Americans who carry a balance. However, the credit burden can be far greater for those at the lower end of the economic spectrum. For the lowest income quintile (households making $24,999 or less annually), the average credit card debt was only $3,000 – but that's 12% of the household income for the highest incomes in that group. Burdens for the upper end of the other income groups (up to $160,000) is below 10%.

Given that credit card debt is generally the highest interest debt that most people hold, it's easy for lower-income Americans to be caught in a debt spiral that eventually leads to default.

If your credit situation is getting out of control, take steps to reign it in now. Start with a realistic budget that gives you a surplus at the end of the month. Cut expenses as necessary to get to that surplus, and then apply the surplus to paying down your debt.

The credit card default club may be growing, but it's not really a club you want to join. The dues will be painful.

If you want to reduce your interest payments and lower your debt, join MoneyTips.

Real Estate Broker Gets Prison for $3.5 Million 'Shotgun' Loan Scheme

A New York real estate broker who pleaded guilty in a loan scheme that defrauded banks of $3.5 million will be heading to prison.

Michael Arroyo, 60, was sentenced Thursday to 21 months in prison and five years of supervised release for conspiracy to commit bank fraud by “shotgunning,” or submitting several loan applications to different banks at the same time in order to fraudulently acquire multiple home equity lines of credit.

Arroyo and co-conspirator Rafael Popoteur, 67, of New Jersey obtained loans of more than $500,000 on residential properties in New York and New Jersey from multiple banks between 2012 and 2014, according to Department of Justice officials.

Arroyo, Popoteur, and other real estate brokers put up the residences as collateral when the properties were either already being used as collateral with another lender or were already subject to senior liens not yet recorded, federal officials said.

Popoteur, who also pleaded guilty to conspiracy to commit bank fraud, was sentenced to three years of supervised release, including one year of house arrest.

FINRA Targets Cryptocurrency Firm Marketing HempCoins for Selling Unregistered Securities

FINRA’s case against Rocky Mountain Ayre regarding its sale of the cryptocurrency called HempCoin might finally settle the issue on whether the token is a security or not.

Financial regulators in the United States are now taking steps to ensure that firms engaged in cryptocurrency-related activities operate within the confines of the law. In a recent move, the Financial Industry Regulatory Authority (FINRA) is accusing Rocky Mountain Ayre President Timothy Tilton Ayre of selling unregistered securities in connection with the company’s sale of HempCoin cryptos.

Accused of Repackaging HempCoin as Securities

Financial Industry Regulatory Authority is charging Timothy Ayre with securities fraud and unlawful distribution of unregistered securities, according to TechCrunch. Ayre is listed as the president, CFO, secretary, treasurer and director of Rocky Mountain Ayre, Inc. (RMTN), a Delaware-based holding company that partnered with Tahionic Soft SRL to put up BitLocation, a company that offers retail businesses a means to trade cryptos and become cryptocurrency locations, according to data from The Wall Street Journal.

FINRA accused Ayre of trying to entice the public from Jan. 2013 to Oct. 2016 to invest in his company, Rocky Mountain Ayre, by purchasing HempCoin, which Ayre claimed as “the first minable coin backed by marketable securities,” according to a Yahoo Finance article. FINRA said that after Ayre purchased the coin’s rights in June 2015, he “repackaged it as a security that was backed by RMTN as a common stock.” Ayre was also reported as having given his assurance that each HempCoin is equivalent to 0.10 shares of RMTN common stock.

FBI: Wisconsin postal worker stole money from thousands of letters

A postal worker was arrested in Wisconsin after she was caught stealing thousands of letters to pay bills.

Sunday, September 16, 2018 08:55AM

A Wisconsin postal worker has been fired after the FBI caught her stealing mail.

Investigators found more than 6,000 opened envelopes in the woman's car. Some of the mail dated back to March 2017. Much of it was intended for people celebrating birthdays and special occasions.

Agents said the postal worker was caught in a sting that involved a $20 bill in an envelope. When the envelope was opened, it sent a signal to agents, who arrested the worker.

The postal worker told investigators she used the stolen money to take care of her children and pay bills.

Ex-CEO of Crypto Company Sentenced to Prison for Fraud, Fined $9 Million

The former CEO of a cryptocurrency company has been sentenced to prison time and ordered to pay $9 million in restitution due to his company’s role in a major Ponzi scheme that cost hundreds of investors millions of dollars. The hearing comes as the U.S. government and regulatory agencies step up their crackdown on cryptocurrency-related fraud.

A District Court Judge in Connecticut sentenced 33-year-old Josh Garza to a 21-month prison sentence followed by six months of house arrest for his role in a Ponzi scheme based around the issuance of a cryptocurrency – called PayCoin – which entitled investors to a portion of another company’s mining profits.

The scheme was conducted between May of 2014 and January of 2015 through four companies owned by Garza. These companies sold the rights and access to cryptocurrency mining operations and allowed investors to buy a portion of these operations through “PayCoin “and “Hashlets,” which claimed to give investors the rights to a portion of the profits from the mining operations.

John Durham, the U.S. District Attorney for Connecticut, spoke about the scheme, saying that “hashlet customers, or investors, were buying the rights to profit from a slice of the computing power owned by the companies.”

Although the operation seems legitimate on the surface, Garza made multiple claims that should have raised red flags for investors, including the guarantee that the price of the virtual currency wouldn’t drop below $20 per unit, because the company would prop the price using their $100 million digital currency reserve.

After pleading guilty for defrauding investors and committing wire fraud, Garza was ordered to pay full restitution to all the investors that had lost their entire investments after the operations were found to be illegitimate. The judge required that Garza pay all the investors a total of $9,182,000 in restitution and was sentenced to 21 months in prison.

Garza’s Sentencing Comes as the US Government Increases Its Crackdown on Cryptocurrency Scams
This past week, a New York federal judge ruled that Initial Coin Offerings (ICOs) fall under the umbrella of securities offerings, opening up the gates for the Securities and Exchange Commission (SEC) to move to shut down fraudulent, or potentially fraudulent, ICO operations.

The ruling came about in a case regarding a man who has defrauded ICO investors by claiming, and providing falsified evidence, that the virtual currency was physically backed by diamonds and real estate.

Judge Raymond Dearie, the judge handling the case, commented on his ruling, saying that:

“Congress’ purpose in enacting the securities laws was to regulate investments, in whatever form they are made and by whatever name they are called… Stripped of the 21st-century jargon, including the defendant’s own characterization of the offered investment opportunities, the challenged indictment charges a straightforward scam, replete with the common characteristics of many financial frauds.”

Following this ruling, the SEC immediately moved to shut down and charge two cryptocurrency scams that were defrauding investors. The first company charged was TokenLot, a self-described ICO superstore, that was charged with operating as an unregistered broker-dealer. The TokenLot team cooperated fully with the SEC, which led to light charges.

The second company that was shut down by the SEC was a cryptocurrency hedge fund, called Crypto Asset Management LP, that had falsely claimed to investors that it was the first fully regulatory compliant crypto hedge fund. The operator of this fund, Timothy Enneking, had taken over $3 million from investors, and more than 40% of his fund’s investments were considered as securities by the SEC.

It is likely that the SEC and other regulatory authorities in the U.S. will continue to crackdown on cryptocurrency-related scams in the near future.

House of Representatives Passes FinCEN Bill that Targets Virtual Currencies

The House of Representatives has approved the “FinCEN Improvement Act of 2018,” sponsored by Rep. Ed Perlmutter (HR 6411). The bill was passed on a voice vote indicating strong bi-partisan support in the House.

The legislation requires the Department of the Treasury’s Financial Crimes Enforcement Network (or FinCEN) to work with foreign financial intelligence units to thwart the use of virtual currencies, such as Bitcoin, potentially used by terrorist groups for illicit activity and money laundering.

The current language of the bill states;

“Although the use and trading of virtual currencies are legal practices, some terrorists and criminals, including international criminal organizations, seek to exploit vulnerabilities in the global financial system and are increasingly using emerging payment methods such as virtual currencies to move illicit funds.”

In effect, the legislation requires FinCEN to focus more of its efforts on emerging technologies including cryptocurrencies. FinCEN’s current mission is to “safeguard the financial system from illicit use and combat money laundering and promote national security through the collection, analysis, and dissemination of financial intelligence and strategic use of financial authorities.”

Financial Services Committee Chairman Jeb Hensarling commented on the passage of the bill in the House;

“I’m pleased to see these important measures pass the House today to bring greater accountability and transparency to the Federal Reserve and to move the Committee’s efforts to thwart terrorism forward by ensuring appropriate processes are in place to protect our financial networks from unwarranted use by illicit, terrorist groups.”

The bill now migrates over to the Senate for further consideration.

"Businesses generally remained optimistic about the near-term outlook, though most districts noted concern and uncertainty about trade tensions - particularly though not only among manufacturers," said the report, which gathers accounts from local contacts nationwide.

"A number of districts noted that such concerns had prompted businesses to scale back or postpone capital investment."

The report said "six of the 12 districts" pointed to instances where the lack of available workers was eating into sales caused employers to delay projects.

"Wage growth was mostly characterised as modest or moderate."

Survey respondents said Mr Trump's trade wars had driven up prices for manufacturers and others, which companies planned to begin passing onto consumers, while also causing prices for key commodities like soy beans to plummet.

Farmers were particularly worried in the St. Louis region.

"Farmers continued to express concerns over low agricultural commodity prices resulting from the trade dispute between China and the United States," according to the report.

"Contacts in Missouri and Indiana indicated that farmers did not lock in pre-tariff pricing for a majority of their soy bean crop, leaving them exposed to current market conditions."

China, the largest purchaser of US soy exports, slapped stinging retaliatory tariffs on American exports of the crop, counterpunching against Mr Trump's tariffs on US$50 billion in Chinese-made industrial and technological goods that Washington says have benefited from theft of intellectual property, subsidies and state intervention.

Farmers, retailers and manufacturers have mounted an increasingly robust lobbying campaign against Trump's trade wars, vowing a full-court press against them in advance of November's hard-fought midterm elections.

Word of businesses holding up investment helped send Wall Street lower following a midday rally, with stocks ending near flat in New York.

Miami financial adviser pleads guilty in Petroecuador money laundering case
Some of the laundered money was allegedly used to purchase South Florida real estate

A Miami financial adviser pleaded guilty for his role in an international money laundering scheme where top officials of Ecuador’s state oil company allegedly used some of the proceeds to buy South Florida real estate.

Jose Larrea pleaded guilty in Miami on Tuesday before a U.S. District Judge to one count of conspiracy to commit money laundering, according to a release from the U.S. Attorney’s office. The plea is part of an ongoing investigation into an extensive bribery scheme used to pay several Petroecuador and other Ecuadorian government officials in order to secure contracts, according to a court motion.

Larrea admitted to conspiring with his co-defendant, Frank Roberto Chatburn Ripalda, a dual U.S. and Ecuadorian citizen who also lives in Miami, as well as others to conceal the proceeds of the scheme, including bribes paid to Petroecuador officials, the release said.

Federal officials said Larrea admitted to wiring more than $1 million from his own U.S.-based bank account to other U.S. bank accounts. Larrea made the wire transfers to conceal a bribery scheme in an attempt to retain existing contracts and win new business with Petroecuador. Larrea’s attorney, Ana Davide, did not immediately respond to a request for comment.

Larrea is now the fourth person to plead guilty in the case. Two former officials of Petroecuador, who received bribe payments, and a contractor have pleaded guilty so far for their connections to the illegal activity. One of the former officials, Marcelo Reyes Lopez, was sentenced in July to four years and five months in prison for his role in the scheme.

Lopez allegedly bought six South Florida properties with the laundered money between 2013 and 2014 for a total of $3.5 million, according to court documents. The properties are:

11316 Northwest 79th Lane, Doral: a four-bedroom, three-bathroom house
14340 Southwest 156th Avenue, Miami: a three-bedroom, two-bathroom house
16711 Collins Avenue, Unit 1902, Sunny lsles Beach: a two-bedroom, two-bathroom condo
605 South Ocean Drive, Hollywood: a three-bedroom, two-bathroom house
609 South Ocean Drive, Hollywood: a multifamily complex
345 Monroe Street, Unit 1-4, Hollywood: a multifamily complex
Larrea’s codefendant, Chatburn, was charged in April with one count of conspiring to violate the Foreign Corrupt Practices Act, one count of violating the act, one count of conspiring to commit money laundering and two counts of money laundering. Chatburn has pleaded not guilty, and his trial is currently set for Oct. 15.

Federal prosecutors are trying to seize three properties tied to Chatburn: a five-bedroom home at 110 Venetian Way in Miami Beach, a five-bedroom house at 321 West Rivo Alto in Miami Beach and a two-bedroom condo at 2627 South Bayshore Drive in Coconut Grove.

Larrea’s guilty plea follows another ongoing money laundering investigation. In that case, federal officials are alleging top executives of Venezuela siphoned $1.2 billion from its state oil fund, PDVSA, to purchase South Florida real estate. The U.S. Attorney’s Office claims at least 16 pieces of South Florida property are tied to the defendants of that scheme, one of which was a condo in the Porsche Design Tower in Sunny Isles.

State of the Union 2018: Stronger anti-money laundering supervision for a stable banking and financial sector – Questions and Answers

The Commission proposed today to further strengthen the supervision of EU financial institutions to better address money-laundering and terrorist financing threats.

While the EU has strong anti-money laundering rules in place, recent cases involving money laundering in some EU banks have raised concerns that those rules are not always supervised and enforced effectively across the EU. This creates risks for the integrity and reputation of the European financial sector, but may also have financial stability implications for specific banks.

As part of the broader efforts to complete Banking Union by risk reduction and risk sharing and develop Capital Markets Union, decisive action must be taken to ensure that anti-money laundering rules are effectively supervised across the EU, and different authorities cooperate closely with each other.

Therefore, the European Commission proposes today to amend the Regulation on the European Banking Authority (EBA) in order to strengthen the EBA's role and give it the necessary tools and resources to ensure effective cooperation and convergence of supervisory standards.

This is part of a broader strategy to strengthen the EU framework for prudential and anti-money laundering supervision for financial institutions, which the Commission is setting out in a Communication. It consists of legislative and non-legislative measures to make anti-money laundering supervision more effective and improve the cooperation between prudential and anti-money laundering supervisors.

These measures will contribute to promoting the integrity of the EU's financial system, ensuring financial stability and protection from financial crime.

What are today's anti-money laundering rules and how do supervisory authorities manage associated risks?

The EU has a strong legal framework for preventing and fighting money laundering and terrorist financing in place. Financial institutions as well as other entities are required to put in place internal systems to identify, assess and manage money-laundering risks related to their business. The supervisory framework for combating money laundering is based on the Anti-Money Laundering Directive, which also applies to a number of actors outside the financial services sector. While the rules are set at European level, their enforcement is carried out by national authorities.

The fifth revision of the Anti-Money Laundering Directive is an important step forward towards a stronger supervision of money-laundering issues in the EU. The Directive sets up a system for better cooperation and exchange of information between money-laundering and prudential supervisors. It also provides for the conclusion of a Memorandum of Understanding between the money laundering supervisors and the European Central Bank for the exchange of information.

Why is additional action on supervision required?

Despite this strengthened legislative framework, several recent cases of money laundering in European banks have given rise to concerns about weaknesses and gaps in the implementation of the legislative framework by the EU's network of different supervisors, in relation to three issues in particular:

Delayed and insufficient supervisory actions to tackle weaknesses in financial institutions' anti-money laundering risk management;

shortcomings with respect to cooperation and information sharing both at domestic level, between prudential and anti-money laundering authorities, and between authorities in different Member States;

lack of common arrangements for the cooperation with third countries in relation to the anti-money laundering supervision of financial institution.

In the EU, the supervision of compliance with anti-money laundering legislation is carried out at national level.

In the Banking Union, the Single Supervisory Mechanism (SSM) is tasked with the direct supervision of significant banks. At the same time, for the prudential aspects relevant to money laundering supervision, it has to apply and rely on national legislation transposing EU Directives in the relevant Member State.

At EU level, the European Supervisory Authorities (the European Banking Authority, the European Securities and Markets Authority, the European Insurance and Occupational Pensions Authority) have the mandate to ensure that the Union's prudential and anti-money laundering rules are applied consistently, efficiently and effectively. However, this is just one of the many tasks these authorities have to carry out. In addition, supervisors are subject to differently transposed national rules, as prudential requirements in legislation have not been supplemented with harmonised guidance.

What changes to the current anti-money laundering framework does the Commission propose?

In order to address the shortcomings identified and further reduce risks in the EU financial system, the Commission proposes, updating its previous proposals on the European Supervisory Authorities, to introduce a set of targetedamendments to the existing legislation on prudential supervision and the regulatory framework of the European Supervisory Authorities.

To ensure high quality anti-money laundering supervision and effective coordination among different authorities across all Member States, anti-money laundering responsibilities in the financial sector will be entrusted specifically to one of the three European Supervisory Authorities, namely the European Banking Authority (EBA), as it is in the banking sector that money-laundering and terrorist financing risks are the most likely to have a systemic impact.

The Commission proposes to clarify the EBA's mandate in the context of anti-money laundering in order to make it more explicit and more comprehensive, accompanied by a clear set of tasks, corresponding powers and adequate resources.

What is the role of the European Banking Authority under the new rules?

On the basis of existing tools and powers of the Authorities, as amended by the pending proposal to review the European Supervisory Authorities, the Commission proposes to give the European Banking Authority (EBA) a more explicit and comprehensive mandate to ensure that risks of money laundering and terrorist financing in the Union's financial system are effectively and consistently incorporated into the supervisory strategies and practices of all relevant authorities.

The amended Regulation will:

ensure that breaches of anti-money laundering rules are consistently investigated: the EBA will be able to request national anti-money laundering supervisors to investigate potential material breaches and to request them to consider targeted actions - such as sanctions;

provide that the national anti-money laundering supervisors comply with EU rules and cooperate properly with prudential supervisors. The EBA's existing powers will be reinforced so that, as a last resort if national authorities do not act, the EBA will be able to address decisions directly to individual financial sector operators;

enhance the quality of supervision through common standards, periodic reviews of national supervisory authorities and risk-assessments;

enable the collection of information on anti-money laundering risks and trends and fostering exchange of such information between national supervisory authorities (so-called data hubs);

facilitate cooperation with non-EU countries on cross-border cases;

establish a new permanent committee that brings together national anti-money laundering supervisory authorities.

These amendments will bring major improvements to the supervisory framework of anti-money laundering risks and contribute to risk reduction in the financial sector.

Supervisory framework

How will the three European Supervisory Authorities cooperate on the fight against anti-money laundering and terrorist financing?

A dedicated committee will be established within the EBA to prepare decisions relating to money laundering and terrorist financing measures (comparable to the existing EBA bank resolution committee). It will be composed of heads of national supervisory authorities responsible for ensuring compliance with laws against money laundering and terrorist financing. The EBA will also cooperate closely with the ESMA and the EIOPA in the framework of the existing Joint Committee of the European Supervisory Authorities (ESAs).

How did the Commission prepare this proposal?

In May 2018, the Commission invited the Chairpersons of the European Supervisory Authorities, the Chairperson of the Anti-Money Laundering Committee of the European Supervisory Authorities and the Chairperson of the Supervisory Board of the European Central Bank, to establish a Joint Working Group to initiate a collective reflection on ways of improving the current framework for cooperation between anti-money laundering and prudential supervisors.

How does this link to work on completing the Banking Union?

Money laundering issues create risks for the integrity and reputation of the European financial sector and may have financial stability implications for specific banks. The European Parliament and the Council have therefore indicated that this is a matter for further work as the EU is completing its Banking Union by risk reduction and risk sharing and developing the Capital Markets Union. Anti-money laundering issues are part of the work on Banking Union mandated by the European Council until December, and the European Parliament has proposed relevant amendments in the context of the pending relevant legislative proposals, in particular the Banking Package, proposed by the Commission in November 2016.

What are the next steps?

The proposed legislative amendments should be considered immediately in the ongoing legislative negotiations on the Commission proposal to review the European Supervisory Authorities' (ESAs) Regulations, adopted by the Commission in September 2017. The Commissions encourages the European Parliament and the Council to reach agreement on these proposals swiftly.

MEMO/18/5725

Thousands of Israelis Were Absent from the WTC on 9/11?
Did 4,000 Israelis stay home from work at the World Trade Center on 9/11?

None of us needed any reminders after the events of September 11 about what an ugly place the world could be, but we continued to receive those reminders nonetheless. In this case, there were plenty of anti-Semitic, anti-Zionist, and anti-Israeli groups eager to use the horrors of September 11 as fodder for propaganda to serve their own political ends.

The pieces quote above scarely merit the dignity of a rebuttal. One need only have read newspaper accounts of the thousands of deaths, viewed TV news interviews with grieving families, and scanned the lists of the dead and missing to know that the terrorist attack on New York City claimed the lives of Christians, Jews, and Muslims; agnostics, atheists, and the non-religious alike. No religion was spared, no denomination singled out. Ordinary people of all nationalities suffered. No miracles, human intervention, foreknowledge, coincidence, or vagaries of fate saved more than a few World Trade Center workers from meeting their deaths that day.

Nonetheless, those with something to gain by sowing the seeds of divisiveness would have had us believe that Israel had advance warning of the World Trade Center attack and managed to notify 4,000 Israeli nationals who worked in the two towers about the upcoming horror, but that they left the U.S. completely unaware of the danger.

(“Hello, David Rosenberg? This is the Mossad. Listen, don’t go to work on Tuesday. Yeah, another terrorist attack on the U.S. … call in sick. And remember, not a word to any of your gentile relatives, friends, or co-workers.”)

And even though this scoop to top all scoops winged its way all over the Internet, the American press apparently remained completely in the dark about the nefarious scheme. Is it any surprise that this story emanated from sources such as Pravda and Al-Manar, the pro-Palestinian “Channel of Arabs and Muslims”?

Why would Israel follow such a course of action, betray its staunchest ally, and doom thousands of innocent Americans to death? There were no rational answers to that question, only ugly propagandistic ones. “Israel wanted to draw America into a final showdown with its Arab enemies, so they didn’t warn us” — the same type of conspiracy theory that posited our leaders knew about the impending Japanese attack on Pearl Harbor allowed it to happen in order to galvanize public support for a war. Old theory, new clothes. Even darker was the implication that Israel, not content to wait for an attack which would embroil America in a Middle Eastern war, forced the issue by pulling off a monstrous act of terrorism again the USA themselves.

“It is clear to all that the Jews/Israel have most to gain and should be considered as a possible source behind this act,” we were told. Those who authored and disseminated this kind of rubbish were really the ones with the most to gain.

News accounts in the wake of the 9/11 terrorist attacks demonstrated that Jews and Israelis did die in the World Trade Towers that day. A 18 September 2001 CNN article reported on one Manhattan synagogue that had lost six of its members in the attacks, five in the towers and one at the Pentagon. A 21 September 2001 ABC News article showed that at (then) last count 400 Jews were killed in the attack. And a 21 September 2001 New York Times article detailed efforts then underway to identify the Jews whose bodies remained beneath the World Trade Center rubble.

The rumor apparently originated with a relatively innocuous Israeli news report speculating that about 4,000 Israelis were believed to have been in the areas of the World Trade Center and the Pentagon at the time of the 9/11 attacks, and that tidbit quickly morphed into the idea that 4,000 Israelis — all of them employees of companies housed in one or the other of the WTC towers — had all suspiciously failed to show up for work on 9/11:

Vague conspiracy theories blaming Israel began to appear within 24 hours of the attacks. Syria’s government-owned Al Thawra newspaper may have been the first newspaper to make the “4,000 Jews” claim. According to U.S. embassy reporting, its September 15th edition falsely claimed “four thousand Jews were absent from their work on the day of the explosions.”

The 4,000 figure apparently came from an article entitled “Hundreds of Israelis missing in WTC attack” which appeared in the September 12th internet edition of the Jerusalem Post. It stated, “The Foreign Ministry in Jerusalem has so far received the names of 4,000 Israelis believed to have been in the areas of the World Trade Center and the Pentagon at the time of the attacks.”

Unknown conspiracy theorists apparently seized upon the 4,000 figure, transforming it into the false claim that 4,000 Jews did not report for work at the World Trade Center on September 11.

But later analysis showed that the proportion of Jews among occupants of the World Trade Center who were killed in the 9/11 attacks was the same as their proportion of the general New York area population:

A total of 2,071 occupants of the World Trade Center died on September 11, among the 2,749 victims of the WTC attacks. According to an article in the October 11, 2001, Wall Street Journal, roughly 1,700 people had listed the religion of a person missing in the WTC attacks; approximately 10% were Jewish. A later article, in the September 5, 2002, Jewish Week, stated, “based on the list of names, biographical information compiled by The New York Times, and information from records at the Medical Examiner’s Office, there were at least 400 victims either confirmed or strongly believed to be Jewish.” This would be approximately 15% of the total victims of the WTC attacks. A partial list of 390 Cantor Fitzgerald employees who died (out of 658 in the company) lists 49 Jewish memorial services, which is between 12% and 13%.

This 10-15% estimate of Jewish fatalities tracks closely with the percentage of Jews living in the New York area. According to the 2002 American Jewish Year Book, 9% of the population of New York State, where 64% of the WTC victims lived, is Jewish. A 2002 study estimated that New York City’s population was 12% Jewish. Forty-three percent of the WTC victims lived in New York City. Thus, the number of Jewish victims correlates very closely with the number of Jewish residents in New York. If 4,000 Jews had not reported for work on September 11, the number of Jewish victims would have been much lower than 10-15%.

Finra fines Citigroup $100,000 for overcharging clients

Citigroup Global Markets Inc. has been fined $100,000 by the Financial Industry Regulatory Authority Inc. for failing to properly supervise the sale of mutual funds to certain retirement plan and charitable organization customers.

According to Finra, between January 2011 and September 2016, customers who were eligible to purchase no-load mutual fund shares were instead sold funds with sales loads and higher ongoing expenses.

Finra orders Citi to pay $4 million in wrongful dismissal case
In May 2016, after Finra initiated an examination of CGMI, it started its own review of the sales practices, according to Finra.

The Finra report found that approximately 274 customer accounts purchased mutual fund shares without receiving the appropriate sales-charge waiver.

CGMI estimates that during the relevant period, customers were overcharged $264,844.

As part of the settlement, CGMI agreed to pay $309,093 of restitution to eligible customers.

"We are pleased to have resolved this matter," said Citi spokesman Drew Benson.

Militarized Drones Take Africa in Counterterrorism Tactic: CIA

The U.S. Central Intelligence Agency’s drone program in Africa is expanding and will target concentrations of al-Qaeda and ISIS in the Nigerian desert, the New York Times said Monday.

Just south of the Libyan border, a covert military base in Duque has been deploying fleets of drones on surveillance missions for several months, a Defense Department spokeswoman, Maj. Sheryll Klinkel told the Times.

She denied the operation of any military missions from the small city airport, however satellite imagery shows five defensive positions, security checkpoints, and walls were constructed in February around the Duque airport.

During an interview with Nigerian Interior Minister Mohamed Bazoum, though he was unable to give details on the drones, he said, “All I know is they’re American.”

Reports said the U.S. presence in the region has grown from 100 military personnel to 800 people.

According to the city mayor, Boubakar Jerome, the aircraft have helped to lower the crime rate. However, during the Obama administration, CIA drone operations were curtailed due to the international backlash after hundreds of civilian deaths in Pakistan and Afghanistan.

Though the Pentagon never took responsibilities for the attacks, program restrictions were introduced. Last year, the policy was changed after complaints from former C.I.A. director, Mike Pompeo, who said they were needless and impediments to U.S. counterterrorism efforts.

Residents have allegedly joined Islamist militias such as Al Qaeda which is grouped in areas of the Islamic Maghreb such as Algeria, Mali, Niger and Libya, the New York paper said.

Times journalists have reported sightings of “Predator” drones, measuring 27 feet long and were behind the scores of civilian deaths taken from western and north African countries since the early 2000’s.

According to the Bureau of Investigative Journalism, over 3,500 victims have died from U.S. airstrikes in Afghanistan since 2015, some 300 of these were civilians.

2 suspected gang members arrested in bank jugging sting using bait vehicle

Two suspected gang members were arrested Friday in a bank jugging sting after Houston police used a bait car and a bag of money to lure in the alleged would-be thieves.

Fverswan Runnest Alfred, who is already under investigation for a bank jugging in Austin, made his first court appearance late Saturday at a probable cause hearing where the state laid out the evidence against him.

The 24-year-old and his co-defendant, Terry Lumpkin, are now both in the county jail on charges of engaging in organized crime, burglary of a vehicle and evading arrest. The pair allegedly belongs to the 59 Bounty Hunter Bloods street gang, according to court filings.

Undercover officers were working a jugging investigation near Wallisville and Beltway 8 just before noon on Friday when they spotted a dark-tinted car parked in front of the Chase Bank. The driver - later identified as Alfred - parked and re-parked repeatedly, always keeping a clear view of the front doors of the bank.

Police grew suspicious, and came up with a plan to bait the men in the lingering car. One of the officers in plainclothes went into the bank and made a faux transaction, then emerged with a bag full of $2,500 of cash, prosecutors said.

When he emerged and got in the unmarked car to leave, Alfred and Lumpkin allegedly started following. They tailed the police car for roughly 5 miles, before the officer stopped at an Academy Sports Store and went inside.

Alfred watched the officer get out, and investigators later found binoculars in the suspects' vehicle, according to a probable cause statement read in court.

Once police went inside the store, Alfred reparked next to the unmarked car. Lumpkin hopped and, according to authorities, used a spring-loaded window punch to break into the vehicle.

He allegedly tried swiping the bag of money from under the center console, but it was held in place with a security cable.

Police moved in for an arrest, and Lumpkin ran away through the parking lot. He was later captured and arrested.

Alfred sped off and allegedly led police on a 1.5-mile chase, driving the wrong way and ultimately crashing into a light pole before he was taken into custody.

Now, he's in jail on $71,000 bail. Prosecutors cited his one prior misdemeanor and four prior felony convictions in their request for high bond.

15 Colombian nationals arrested in violent jewel robberies in North Texas, across U.S.

A ring of Colombian jewel robbers used sophisticated and brutal tactics to carry out 11 robberies or attempted robberies over a two-year span, the U.S. Justice Department says.

Fifteen people have been arrested and face charges related to the robberies, along with organized crime and conspiracy charges.

Between September 2014 and January 2016, they allegedly robbed jewelers and traveling jewelry salespeople three times in Dallas, once in Farmers Branch and twice in Houston. Other heists happened in Oklahoma City; Miami Beach; Hollywood, Florida; Indianapolis and Vienna, Virginia, officials said in a news release.

Obtaining rental cars, airplane tickets and hotel rooms, and opening bank accounts using fake identification, the suspects conducted surveillance on diamond and jewelry stores, along with traveling jewelry salesmen, in order to identify potential victims, authorities said.

In some incidents, the robbers would block a salesman’s vehicle with one of their own and disable the salesman’s vehicle by slashing its tires or breaking its windows, authorities said.

They would use violence, threats of violence and weapons, including BB guns and knives, during the robberies, authorities said. They sold the jewels to “fences,” who deal in stolen goods, and split the proceeds.

The arrested men and women were identified as Jonathan David Malpica, 33; Tito Andres Vargas Urbina, 31; Roger Zamora, 40; Camila Andrea Espitia, 23; Mohammed Natour, 32; Omar Gonzalez, 38; Fabrizia Cavanna Sarmiento, 41; Andres Felipe Henao, 32; Bryan David Vargas Londono, 25; Rodolfo Vargas Londono, 30; Luis Garcia, 31; Catherine Salas, 34; Erika Gutierrez Machado, 45; James Jeanphier Tobar Ramon, 27; and Jesus Jean Pool Tovar, 24.

Cavanna and the Londonos were arrested in Colombia by the Colombian National Police, authorities said. The rest were arrested in various locations in the United States between 2016 and 2017.

“The defendants allegedly embarked on a multi-state spree of violent robberies, putting the lives of their victims and other innocent civilians at risk,” said Assistant Attorney General Brian Benczkowski, who announced the arrests along with U.S. Attorney Erin Nealy Cox of Dallas and Special Agent Eric K. Jackson of the Dallas FBI office.

“We have no tolerance for those who would violate the sovereignty of the United States to further their criminal goals and we will bring you to justice no matter where in the world you are located,” Jackson said.

To date, nine of the 15 defendants — Gonzalez, Urbina, Malpica, Machado, Salas, Henao, Natour, Zamora and Garcia — have pleaded guilty, authorities said.

H-1B visa ‘fraud’: Indian CEO in U.S. may have brought in nearly 200 foreign workers: feds

Asif Siddique goes through a pile of papers containing his visa and other immigration documents. He has been working in the U.S. on an H-1B visa but his visa expired before he was approved for a green card. He can no longer work in the U. S. but he stays here while he waits hoping to get his green card. Siddique has been in the US since 1987. He went to school at Ohio State University. He is origionally from Pakistan.

An Indian citizen, CEO of two U.S. staffing firms, was arrested upon his return to the U.S. and charged with engineering what federal authorities are calling a “multi-year visa-fraud scheme” centered on the controversial H-1B visa.

Pradyumna Kumar Samal, 49, had earlier this year “fled the United States” amid a federal investigation into employment practices at the two Washington State staffing firms he led, Divensi and Azimetry, according to the U.S. Department of Justice.

Samal could not be reached for comment.

Samal’s two companies were in the business of supplying tech workers, including software-development engineers, to large corporations, including Fortune 500 firms, the department said in a press release.

Staffing companies and outsourcing firms have become prime targets for critics of the H-1B, a visa intended for workers with specialized knowledge doing specialty work. While major Silicon Valley tech companies rely heavily on H-1B workers, and push for an increase to the annual 85,000 cap on new visas, opponents of the H-1B point to alleged abuses by staffing and outsourcing firms, UC San Francisco, Disney and San Jose tech giant Cisco.

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Samal is accused of submitting, and directing employees to submit, fake documents purporting to show corporate clients agreeing to use workers named in H-1B applications.

“The forged documents included forged letters and fraudulent statements of work, which appeared as if they had been signed by senior executives at the two clients,” the department alleged.

The submitted documents falsely attested that the H-1B visas were for “specialty occupations,” according to an allegation in court documents.

Once U.S. Citizenship and Immigration approved the applications, the workers in question were “benched” — kept unpaid pending possible placement in a client firm of one of Samal’s companies, the department alleged.

“Nearly 200 workers may have been brought in under the phony applications,” the department alleged.

“The employees were forced to pay Samal’s companies a partially-refundable ‘security deposit’ of as much as $5,000 for the visa filings, regardless of whether they were assigned to any projects that provided them with income.”

Law enforcement officers arrested Samal on Tuesday as he arrived at Sea-Tac International Airport near Seattle after an international flight, the department reported. The U.S. Attorney’s office on Wednesday asked that Samal be kept in detention as a flight risk, and a hearing was scheduled for early this week.

The U.S. State Department and Department of Homeland Security in 2015 started investigating the two firms run by Samal, according to court documents. Authorities allege he was committing visa fraud between 2012 and 2015, according to court records.

Samal is accused of engineering a type of visa fraud known as a “bench-and-switch” scheme, court documents said. In this type of visa scam by a staffing company, a firm secures visas through fake or doctored documents, and then offers up workers to clients who are not designated in application materials. Cutting the time between a client’s agreement to use a worker and the receipt of an H-1B visa for the worker provides a business advantage, federal authorities said in a court filing.

“Shortening or eliminating the lag time enables petitioning companies to place employees at end clients faster than their competitors are able to,” a State Department special agent said in the court filing.

New OTC Equity Short Interest and OTC Threshold Data Download and API Guidelines (Effective November 5, 2018)
SEPTEMBER 4, 2018
As part of a technology upgrade, FINRA has implemented improved interfaces to retrieve data and has established naming conventions that follow industry standards. This change will promote consistent column names, both in the file download feature and API access.

FINRA will change column names and the order in which the columns are displayed in the download files.

FINRA will support a new Application Program Interface (API) to enable access to the OTC Equity Short Interest and OTC Threshold Data effective November 5, 2018.

Details for Equity Short Interest are provided in the Equity Short Interest Data File Download API documentation.

Details for OTC Threshold are provided in the OTC Threshold Data File Download API documentation.

The existing methods of API access will no longer work effective November 5, 2018.

If you have any questions, Please contact us by email.

The Financial Industry Regulatory Authority today proposed an increase of position limits on several of the most traded ETF options contracts; these changes, it said, would increase liquidity and add depth to the market.

The proposal, which would double the limits on such contracts as the PowerShares QQQ Trust (QQQ) and S&P’s Depository Trust (SPY), must first be approved by the Securities and Exchange Commission.
FINRA is asking for the rule change, which would affect nine contracts, to take immediate effect if approved by the SEC, thus waiving the 30-day delay the agency typically demands. Options exchanges normally will set position limits; in fact, limits for SPY were doubled to 1.8 million after a NYSE Arca pilot program that ended in July that had eliminated position limits on that product.

The ETF options contracts affected include position limits officially increased to: 1) 1.8 million on SPY and QQQ; 2) 1 million on Russell 2000 Index (IWM) and MSCI Emerging Markets Index (EEM); and 3) 500,000 on FTSE China 50 Index (FXI), MSCI EAFE Index (EFA), MSCI Brazil 25/50 Index (EWZ), ICE U.S. Treasury 20+ Year Bond Index (TLT), MSCI Japan Index (EWJ).
SPY’s fund market capitalization in 2017 was $240.5 billion while QQQ’s was $78.8 billion.

Justification

FINRA says the broad-based indexes are unfairly subject to tighter position limits than the underlying indexes:
“FINRA believes that if certain position limits are appropriate for the options overlying the same index, or an analogue to the basket of securities that the ETF tracks, then those same economically equivalent position limits should be appropriate for the option overlying the ETF. In addition, the market capitalization of the underlying index or reference asset is large enough to absorb any price movements that may be caused by an oversized trade. Also, the issuer may look to the stocks comprising the analogous underlying index or reference asset when seeking to create additional ETF shares which are part of the creation/redemption process to address supply and demand or to mitigate the price movement of the price of the ETF.”

One example provided is with QQQ, which tracks the Nasdaq 100 Index (NDX). Options on the NDX have no position limits but “share similar trading characteristics as QQQ,” states the FINRA proposal.

Using $154.5422 as the QQQ share price, and NDX level of 6,339.14, FINRA showed where 40 contracts of QQQ equals one share of NDX. If it was assumed the position limit on the NDX was 25,000 contracts, as is the minimum under exchange rules for broad-based contracts, the equivalent would be 100,000 for QQQ.

However, there are no position limits on NDX, which has an average daily trading volume of 15,300, while options on QQQ, with the current position limit of 900,000, have an ADV of roughly 580,000 contracts. That said, the component securities of the NDX in aggregate traded 440 million shares per day in 2017, thus “both market capitalizations being large enough to absorb any price movement by a large trade in QQQ.”

The argument that these ETF options contracts are as liquid or more so than their underlying indexes, which have for the most part no position limits, runs throughout each of FINRA’s contract arguments.

Finra also noted it was confident in surveillance procedures by the exchanges to identify any unusual activity in both the options and underlying stocks. In addition, regulators can keep an eye on margin and capital of members holding large positions, and can impose a higher capital charge on those members if they believe it necessary.

FINRA stated it believes “that the proposed rule change promotes consistent regulation by harmonizing position limits with those of the other self-regulatory organizations. FINRA further believes that increasing the position limit on conventional options promotes consistent regulation by harmonizing the position limit with its standardized counterpart.”

There will be a 60-day period in which comments will be accepted. However, the SEC has the right to suspend the proposal if it feels it’s not in the public interest and move on to hearings on its probity.

Security Crisis Stains Peña Nieto’s Legacy in Mexico

Mexico President Enrique Peña Nieto’s final report on the state of the country showed that the security crisis will be one of his darkest legacies and one of the incoming administration’s toughest challenges.

Peña Nieto publicly presented the sixth, and final, report of his administration’s actions on September 3. The document has one chapter dedicated to Mexico’s deepening security crisis.

“Although I have to acknowledge that there are areas where our efforts did not meet the objectives we had set for ourselves, I also leave knowing that the Mexico we hand over is, without a doubt, better than the Mexico we had six years ago,” Peña Nieto said in one of the videos that accompanied the report.

During the presentation, which was attended by Mexico’s political elites, the president ran through some of what he defined as his administration’s main accomplishments in the fight against violence and organized crime.

He mentioned moves for state institutions to work more closely together, the strengthening of security forces, the increased use of intelligence, the development of social programs to prevent violence, the implementation of a new justice system and the passing of a number of laws to fight corruption, which has been a challenge in Mexico for decades.

“We have fought violence with intelligence and with the legitimate use of violence at the hands of the state. In this way, we have succeeded in reducing the capacity and size of criminal organizations,” Peña Nieto said, adding that authorities had either arrested or killed 110 of the 122 criminal targets it had set out to apprehend when he took office.

However, the president also acknowledged that although violence decreased during his first years in office, the kingpin strategy, largely based on targeting the heads of criminal organizations, has led to the fragmentation of larger groups into smaller cells that have been more difficult to target, particularly given the poor capacity of local police forces.

“I’m aware that we didn’t meet the objective of finding peace for Mexicans across the country. Turning that desire into reality will require a long, sustained effort,” Peña Nieto said.

InSight Crime Analysis
There is no doubt this would have been a tough speech for President Peña Nieto to deliver. No matter how hard he tried to highlight the security advances made during his six years in office, rising homicide figures cast a very bleak light on the country’s reality and the challenges ahead.

Peña Nieto arrived at the presidency in December 2012 determined to change course from the aggressive militarization of his predecessor, Felipe Calderón. But many blame him for a rise in the rate of homicides across the country because he lacked a sense of proper policy craftsmanship and seems to have failed to consider the precise reasons for Calderón’s fiasco.

Instead of building a comprehensive security strategy, Peña Nieto voiced support for novel half-measures that were ultimately meaningless: creating an unnecessary new federal police agency, promising to downplay the kingpin strategy and shifting public attention away from the government’s clashes with drug cartels.

This was a recipe for failure.

The clearest evidence of Peña Nieto’s misguided strategy is the stratospheric leap in Mexico’s crime rate.

The outgoing president opened his tenure with two years of declining murder rates, but his team was unable to maintain this trend. By 2015, the number of killings was again on the rise, and the nation is now more violent than when Peña Nieto was inaugurated. By some measures, Peña Nieto’s Mexico has surpassed all precedent. With nearly 2,900 homicides, May 2018 was the bloodiest month in the country’s modern history.

But Peña Nieto’s missteps cannot be fully illustrated by crime statistics alone. Acts of corruption and incompetence throughout his administration have gravely undermined public confidence in government institutions. The most notorious example—the government’s bungling of the investigation of the forced disappearance of 43 students from a rural teachers’ college in Ayotzinapa—reads as a relic from the nation’s authoritarian past.

Ayotzinapa has rightly become both an international scandal and an emblem of Peña Nieto’s ineptitude, but it is one of a drumbeat of scandals that leave the public unable to trust its leaders. The army was credibly accused of perpetrating a massacre in 2014. More than a dozen governors have come under investigation for corruption, in most cases stemming from ties to organized crime. And a number of promising anti-graft reforms are still little more than words on paper.

Similar examples of the increasing chaos abound.

The rupture in the implicit contract between the governed and government has been deepened by Peña Nieto’s disinterest in protecting the press. This has propitiated the continued slaughter of Mexico’s media workers, many of whom have, in turn, opted for self-censorship.

Similarly, Peña Nieto’s administration has done little to tackle the increase in attacks on municipal officials, which have left scores of mayors dead during his tenure. In 2018, more than 100 candidates for public office—primarily at the local level—were murdered. This gruesome trend has undercut the effectiveness of local governments, which in theory should be the most responsive to citizens’ day-to-day concerns.

The election of Andrés Manuel López Obrador amounted to a profound rejection of the establishment that Peña Nieto represents. Much of that rejection was a product of his flailing security policy. But while Mexicans appear excited to turn the page on the current administration, the breaches in public trust that Peña Nieto created will not be easily healed. This sad legacy will present a challenge to governance for years, if not generations, to come.

Police Officers' Murder in Mexico Is a Revenge of Organized Crime
The murder of four municipal police officers in Tonala, Jalisco, including the special operation commander, is now considered a revenge against organized crime for the actions against them.

Municipal president, Enrique Ibarra, said this statement in reference to a new action of violence in Jalisco, and in the country, which claimed the lives of police officers and the armed forces members.

The police officers were ambushed by hired assassins who were waiting for them in a car, and from where they fired at the patrol in which commander Eduardo Plazola was being transported.

A police officer was among the soldiers who lost their lives. The murderers fled and a search and capture operation was implemented in the state.

The Jalisco Nueva Generacion cartel, considered today the most dangerous one in the country, operates, above all, in Jalisco.

Europe needs a central anti-money laundering body
Danske Bank scandal highlights a gaping hole in financial regulation

The scandal surrounding alleged money laundering through the Estonian branch of Denmark’s largest lender, Danske Bank, is escalating into one of the biggest such cases in Europe. As the Financial Times has disclosed, an independent investigation found that as much as $30bn of Russian and ex-Soviet money flowed through the Estonian arm in a single year, 2013 — an eye-popping volume for a small branch operation. It suggests serious gaps in the bank’s safeguards, and in Europe’s efforts to combat money-laundering.

The $30bn figure, it must be noted, represents total money flows from countries such as Russia, Azerbaijan and Moldova, not transactions that appeared suspicious. But a Danish newspaper in July alleged $8.3bn of suspicious money— more than twice previous estimates — passed through Danske’s Estonian branch from 2007 to 2015. Money was being moved between shell companies, often in repeated round trips. The sheer volume of total flows in 2013, the peak year, means the eventual total of suspicious transactions looks set to grow.

It also intensifies the questions over why alarm bells were not clanging at Danske’s Copenhagen headquarters. Even before the bank releases two internal reports in coming weeks into the Estonia case, the position of senior managers — including chief executive Thomas Borgen, who headed Danske’s international banking until 2012 — looks increasingly untenable.

A report from Denmark’s financial regulator in May noted that a whistleblower emailed Danske’s senior management in December 2013 complaining about anti-money laundering issues in the Estonian branch. Danske’s audit department confirmed the concerns in February 2014, but the bank launched a full investigation only in September 2017. The regulator also found that the Estonian branch had “deficiencies in all three lines of defence”, including anti-laundering measures, integration into the group’s risk management, and internal audit.

Mr Borgen has offered to step aside if it would help resolve the case. But the scandal may now have reached the point where only replacing the top leadership will enable Danske to draw a line under the issue. Investors are increasingly jittery, especially over the possibility of a US investigation.

Memories are fresh of Deutsche Bank’s $630m-worth of fines from US and UK regulators last year for so-called mirror trades, which were allegedly used to launder $10bn out of Russia. US officials — who have repeatedly, and embarrassingly, proved better able to police European money laundering than Europe’s own authorities — have not confirmed whether they are probing Danske themselves, but said they are “following the case closely”.

TSB’s tech travails, Danske scandal and changing German attitudes
The Danske scandal has also highlighted again the patchwork nature of Europe’s anti-money laundering supervision. Smaller countries such as the Baltic states, Cyprus and Malta have often lacked the resources, and determination, to tackle financial crime, leaving them open to exploitation. A shortage of specialist expertise in smaller financial centres can also lead to revolving doors between the regulators and the regulated.

While the European Central Bank scrutinises banks’ business models and governance, policing criminal financial flows is still a national competence. An EU-wide anti-money laundering body is sorely needed to harmonise and enforce rules, and direct additional resources to where they are most needed. EU institutions and member states need to find the political will to close what is a gaping hole in the continent’s regulatory framework.

20-year-old charged with leading organized crime for having friends receive his Ecstasy shipments

A 20-year-old Silverdale man was charged Friday with a count of leading organized crime for having friends receive shipments of the club drug MDMA he ordered over the internet, which he then allegedly sold to a University of Washington student living in Seattle.

The 20-year-old had his friends receive the packages from the Netherlands because he lived at home with his parents, according to court documents.

The case started in June when customs agents X-raying packages discovered about 200 grams of MDMA hidden in a DVD case destined for the residence of one of the 20-year-old’s friends, according to court documents. MDMA is also known as Ecstasy or Molly. Federal authorities turned over the case to local authorities who tracked the package back to the 20-year-old.

The suspect admitted to ordering the drug off the “dark web,” a part of the internet that requires special software or permission to access. One shipment was seized by authorities, so he asked four friends to receive the packages with the instructions not to open them to ensure they had “plausible deniability,” according to court documents. Some friends received payment for accepting the packages. He told investigators he bought the MDMA for $1,500 and then sold it to the student in Seattle for $3,000.

The suspect told investigators he trafficked about 4.5 pounds of the drug to his connection in Seattle, according to court documents.

A WestNET detective wrote in court documents this made the suspect the “biggest MDMA supplier” he has seen in Kitsap County in his three years as a narcotics detective.

MDMA, a synthetic drug, rose to prominence in the 1980s at dance clubs and may have some therapeutic uses. It is not associated with property crime and violence like meth and heroin, however, the National Institute on Drug Abuse warned that in high doses, the drug can be dangerous, if not deadly. When preparing doses, dealers sometimes mix in other drugs.

In addition to the charge of leading organized crime, prosecutors also charged the 20-year-old with conspiracy to deliver a controlled substance, possession of a controlled substance with intent to deliver, and attempted delivery of Ecstasy. Prosecutors added aggravators for “major violations” of drug laws as well as for the suspect’s residence being located within a “Drug-Free Zone.”

Americans Can Lose $3 Bln in Dubious ICOs. FinCEN Has Drowned In Delations

The regulator got the overwhelming majority of the information within the SAR (Suspicious Activity Report) program – the mandatory notification of the financial intelligence about unusual financial transactions.

SAR’s requirements are simple at the first sight. Every transaction can seem suspicious if it exceeds $5000 for the emitents and $2000 for usual private customers and legal bodies. At the same time: the customer uses a fake identifier (ID), two customers use the same ID, he changes the transaction after the demand to show the ID, performs several transactions for amounts slightly less than acceptable, tries to avoid the requirements of the law on bank secrecy, and so on.

At the same time, the regulator receives information not only from usual financial companies but also from crypto exchanges.

"These messages include both bank and crypto exchanges orders. Many of them turned out to be extremely important for law enforcement agencies," - says Kenneth BLANCO. "The information in the reports included data on beneficial ownership, additional activities related to stock exchanges that we had not previously known, and jurisdictional information".

Moreover, the legal basis of the inspection is the FinCEN 2011 rule released for the fiat money.

According to American instructions, more than 70% of transactions conducted in the virtual market can be considered suspicious. Firstly, anonymous transactions automatically fall within the SAR. They do not use ID at all, and this is already a formal reason for contacting the competent authorities. Secondly, the problem is in the assessment of the value of transactions. The price of crypto assets can vary not by cents, like fiat, but by hundreds of dollars within a day. Accordingly, a critical financial threshold can be passed in a very short time regardless of the will of the transaction parties, which, of course, does not make it illegal.

It is quite possible that a huge number of appeals is just a consequence of the bureaucratic formalism. However, this does not solve the problem in general. According to the US Federal Trade Commission (FTC), during just two months of 2018, US citizens lost $ 532 million in illegal operations in the ICO market. At the same time, according to pessimistic forecasts, this figure could grow to $ 3 billion by the end of the year.

For example, at the end of last year, the US authorities initiated a criminal case against Russian immigrant Maxim Zaslavsky, the owner of the Diamond Reserve Club World (DRC World) and the REcoin Group Foundation. The businessman held two ICOs, during which funds and tokens secured by real estate and diamonds should have appeared in the virtual market. Investors did not see any tokens or diamonds, although they managed to invest over $ 300,000 in Zaslavsky's business. The SEC has noticed a potential scam, and now the businessman faces a serious prison term and a fine.

Disturbing, but also encouraging messages come from another part of the world. The National Police Agency (NPA) of Japan spent 35 million yen ($ 315,000) last year on the development of the software to capture scams in the crypto market. Under the technical enquiry, the software should track the blockchain and identify suspicious movement of funds. Japanese colleagues of American security forces are also concerned about the ever-increasing number of illegal transactions with virtual assets. Since June 18, regulators of the Land of the Rising Sun have banned even the turnover of anonymous cryptocurrency. That resulted in the withdrawal of several popular tokens from the market.

It has not been reported yet what results Japanese specialists have achieved. However, the trend is evident. Law enforcement agencies seem to have poured themselves into the virtual market. Everything new, and cryptocurrencies are not an exception, is extremely irritating for the bureaucratic apparatus. Moreover, even if the representatives of the new economy do not do anything that could harm consumers, their actions are still under suspicion. However, this trend has a positive side too. The increased attention of the security services and regulators to this sphere of the economy is a step towards the creation of the unified regulatory system, which so many businessmen are talking about. What it will be like is the subject of discussion and political bargaining. The main thing is there is a counter movement.

It will be recalled that the beginning month will, in many ways, determine the virtual market. On September 7, the meeting of the European Union Ministers of Finance on the regulation of cryptocurrencies will take place; on September 11, hearings in the Supreme Court of India on the legality of the turnover of virtual assets are to take place; on September 21, the SEC of the USA will consider the issue of the admissibility of the presence of crypto assets on the financial market.

‘100% illegal’: The business of weed banking is veiled in secrecy

Before recreational marijuana became legal in some parts of the U.S., starting in 2012, you needed cash to buy weed. These days, even many legal weed businesses are still cash-only because banks refuse to deal with them — forcing some dispensaries to transport their money in armored cars and pay their taxes with stacks of $20 bills.

Last month, a Florida politician said Wells Fargo went as far as to close her account simply because she accepted money from lobbyists for the medical-marijuana industry. But federal data suggests there’s been a slight increase in the number of banks dealing with pot businesses.

The Financial Crimes Enforcement Network (FinCEN) reports that, as of March, 411 banks and credit unions work with pot businesses — up from 318 in October 2016. Patrons of big marijuana dispensaries like San Jose, California’s Airfield Supply Co., Colorado-based LivWell, or Culver City, California-based MedMen might be pleasantly surprised to find they can finally, at long last, pay for their weed with a debit card.

Weed businesses that take debit cards have presumably found banks to work with them. But, asked to identify which banks work with cannabis companies, Harvey Englander, a spokesperson for the United Cannabis Business Association wrote, via email: “Your question provides me with a conundrum because if I identify some banks they may close the accounts. So I must decline to respond.”

That might be because it’s still technically illegal to provide banking services to weed companies and, potentially, because marijuana is still stigmatized. One thing is clear: Even as more states legalize marijuana, a tiny fraction of banks are willing to work with cannabis companies. The financial institutions that do serve cannabis companies tend to be smaller banks and credit unions — and most do not advertise their services to the world.

‘It is 100% legal under federal law to bank the cannabis industry’
It was less than six years ago that Washington and Colorado became the first states to legalize marijuana for recreational use. While a total of nine states and Washington, D.C., have legalized recreational pot, and 30 states have legalized it for medical purposes, weed companies still operate in a legal grey area because pot is illegal under federal law. The DEA classifies cannabis as a Schedule 1 drug, meaning it has “currently no accepted medical use.” That puts it in the same category as heroin.

Under the Obama administration, then-Deputy Attorney General James Cole issued a memo, known as the Cole Memorandum, that clarified the Justice Department’s stance on pot. The memo, from August 29, 2013, asserted that, for the most part, the Justice Department would not enforce the marijuana ban in states that had legalized it. (Cole laid out a number marijuana enforcement priorities, including preventing drugged driving.)

Following suit, in February 2014, FinCEN, which is part of the Treasury Department, issued its own guidance on how banks could provide services to the cannabis industry without violating an anti-money laundering law, the Bank Secrecy Act. One apparent goal of that memo — to ensure that cannabis companies could find banks.

The guidance noted: “This FinCEN guidance should enhance the availability of financial services for, and the financial transparency of, marijuana-related businesses.”

When the FinCEN guidance was issued, banks could theoretically avoid the threat of federal prosecution as long as they complied with its guidelines — including filing Suspicious Activity Reports, or SARs, for transactions related to all marijuana companies. (The recent FinCEN report showing an uptick in banks that work with cannabis companies arrived at its numbers by examining SARs.)

But the Donald Trump administration has threatened the legitimacy of that FinCEN guidance, which itself referenced the Cole memo multiple times. In January, Attorney General Jeff Sessions rescinded the Cole memo, calling marijuana “a dangerous drug” and asserting that “marijuana activity is a serious crime.” While Treasury Secretary Steve Mnuchin told Congress in February that he wanted the cannabis industry to have access to banks, that might provide little assurance to notoriously risk-averse financial institutions.

“At the end of the day it is 100% illegal under federal law to bank the cannabis industry because of the Bank Secrecy Act,” said business lawyer Hilary Bricken, who writes a column on cannabis policy and regulation for Above the Law. She added, “None of the big banks … openly do business with cannabis companies … These are massively conservative institutions and are probably more regulated than any other institution in the U.S.”

‘We’re prohibited to say who we bank with’
Still, Bricken’s firm, Harris Bricken, does represent a half-dozen banks and credit unions serving cannabis companies in compliance with the 2014 FinCEN guidelines. These banks and credit unions might not advertise themselves as pot-friendly financial institutions, though.

Indeed, LivWell’s executive director and chief legal strategist, Dean Heizer, said he was “not at liberty to” say which bank or credit union his company works with. In fact, he said, that financial institution required him to sign a non-disclosure agreement.

In this May 19, 2018 file photo tourists Randy Wilkie and Keya Cole from Buffalo, New York, check out the offerings of cannabis at one of the MedMen cannabis dispensaries in Los Angeles, prior to boarding the Green Line Trips bus tour.
“As a condition of banking with the institution, we’re prohibited to say who we bank with,” said Heizer, who said his company was “kicked out” of three banks before it finally found one. Other banks that work with cannabis companies also require NDAs, according to Bricken. “Many banks want to keep a low profile if they are participating, so NDAs make sense,” she wrote an email message, while also noting that not every bank that works with cannabis companies requires an NDA.

A representative for another major pot company, MedMen, said he wasn’t sure whether his company had signed a non-disclosure agreement. However, that representative, Daniel Yi, declined to name the financial institutions that work with MedMen. In the past, he’s asked the financial institutions that serve MedMen whether they’d like to speak to reporters covering the cannabis industry.

“I haven’t had one of them say yes,” said Yi, MedMen’s senior vice president of corporate communications and investor relations. He added, referring to credit unions and banks that work with cannabis companies, “Right now they are not wanting to advertise to the world that they’re banking cannabis … I think it’s more the stigma than anything else. If the federal government really wanted to crack down on this, you’re not safe simply because you did not publicize the fact that you’re banking [with the weed industry.]”

The challenge of finding a bank — and serving the weed industry
With relatively few banks dealing with cannabis at all, and those that do declining to advertise their services, it’s not exactly easy for a marijuana company to find a bank.

LivWell has 15 locations in Colorado and Oregon and hundreds of employees, and Heizer said the banks that didn’t want to work with the company didn’t think it was doing anything untoward. Rather, he said, “They got cold feet.” Heizer noted: “Whether or not Justice has the motivation or resources to go after banks, the fact that it remains illegal and Justice hasn’t reaffirmed the FinCEN memo. Practically speaking, it’s only the most robust marijuana companies that are able to get banking.”

Acreage Holdings — a cannabis company that will soon operate in 15 states — has found banking services because it has the resources to account for every dollar of its business, according to the company’s CEO, Kevin Murphy. But smaller firms have a tougher time finding banks. He noted that one of his friends in the cannabis industry recently took a picture of over $1 million he had to pay the IRS in $20 bills because his business didn’t have a bank.

“This business is quickly becoming a business of haves and have nots,” he said, referring to cannabis companies that can and cannot get banking services.

One credit union that openly banks marijuana companies, Seattle-based Salal Credit Union, opens roughly one marijuana-related account for every 10 applications it receives, according to Carmelia Houston, its vice president of business services. That’s partly because the credit union has high standards for its business clients and also because, Houston acknowledged, they don’t want to pay the extra fees that credit unions like Salal charge cannabis companies.

Cannabis companies get charged extra fees for a few different reasons, including the fact that banking weed businesses demands a lot of paperwork. To comply with the 2014 FinCEN guidelines, Houston said that Salal has to file a Suspicious Activity Report (SAR) every time it starts working with a cannabis company and again every 120 days after that.

Moreover, banks like Salal have to assume the added risk that comes with banking cannabis money. For example, banks might attract the attention of federal authorities if they work with a cannabis company that’s sending its wares to a state that hasn’t legalized pot. Christopher Barry, of counsel at Dorsey & Whitney, noted that the following scenario might be problematic:

“Let’s say you’re a bank, and you’re banking a cannabis producer, and it turns out that the cannabis producer is putting a portion of its cannabis on a pickup truck and taking it to Idaho to sell on the black market.”

To assume that risk, and to file mountains of paperwork with FinCEN, banks and credit unions get to charge a “massive premium” to marijuana businesses, according to Bricken. That premium can amount to a fee that’s three to four times higher than what non-marijuana businesses would pay, Bricken said. For credit unions like Salal, though, serving marijuana businesses could have benefits other than the extra fees they can charge.

“We … know that it’s an underserved market, and credit unions are known for serving underserved markets,” Salal’s Houston said. Moreover, she said, “We wanted to help get the cash off the streets to improve public safety.”

In the future, other financial institutions might be able to generate good will from the public by serving the cannabis industry as more states legalize pot and consequently decrease its stigma. Sen. Elizabeth Warren, a Democrat from Massachusetts, is currently working with Colorado Republican Sen. Cory Gardner to pass a bill that would let states regulate marijuana without interference with federal law-enforcement.

For now, though, many banks will continue not to touch weed money. That means that a lot of weed smokers, for the foreseeable future, will have to hit the ATM before they buy pot from legal dispensaries — just like they did when they met their drug dealers on the street corner.

US ally Australia in range of Chinese missiles

The report notes: "The PLA has rapidly expanded its overwater bomber operating areas, gaining experience in critical maritime regions and likely training for strikes against US and allied targets."

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The PLAN Marine Corps (PLANMC) is being expanded from 10,000 to 30,000 personnel by 2020 with a larger mission beyond its current focus on the South China Sea. Critically, strike capabilities are expanding to cover US and allied targets in the region.

The report acknowledges the "PLA …[demonstrates] the capability to strike US and allied forces and military bases in the western Pacific Ocean, including Guam. Such flights could potentially be used as a strategic signal to regional states".

The US and allies such as Australia are within range of Chinese missiles.

For instance, Australia is within range of the nuclear-capable DF-26 and CSS-3 missiles.

China's strategy to avoid dramatic conflict
Fourth, China's preferred strategy is to avoid dramatic conflict. Instead, it uses "opportunistically timed progression of incremental but intensifying steps to attempt to increase effective control over disputed areas and avoid escalation to military conflict."

It combines these incremental measures with economic diplomacy — buying silence and seeking accession. The report documents numerous such instances against the Philippines, Vietnam, and South Korea.

Fifth, China wishes to make "major progress" toward "informatisation" — a concept "roughly analogous to the US military's concept of "net-centric" capability: a force's ability to use advanced information technology and communications systems to gain operational advantage over an adversary".

Sixth, China employs cyber attacks to achieve key strategic goals. These include "intelligence collection against US diplomatic, economic, academic, and defence industrial base sectors".

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The intelligence is then used "to benefit China's defence high-technology industries, support … military modernisation, provide the CCP insights into US … [and] enable PLA cyber forces to build an operational picture of US perspectives".

In addition, it provides knowledge about "defence networks, military disposition, logistics, and related military capabilities that could be exploited prior to or during a crisis".

Seventh, China's military ambitions extend to space: it wishes to acquire "counterspace capabilities, including kinetic-kill missiles, ground-based lasers, and orbiting space robots, as well as to expand space surveillance capabilities that can monitor objects across the globe and in space and enable counterspace actions."

The report notes that China probably has the ability to destroy satellites in space.

Nuclear 'triad' of delivery systems
Eighth, China's nuclear deterrence is evolving to encompass a triad of delivery capabilities. The DOD records that "nuclear capable bombers would, for the first time, provide China with a nuclear 'triad' of delivery systems dispersed across land, sea, and air."

In addition, the country "is developing a stealthy, long-range strategic bomber with a nuclear delivery capability that could be operational within the next 10 years".

Further, China's no-first use policy regarding nuclear weapons is ambiguous. Although it claims it will never use nuclear weapons first, the no-first use policy may not apply if targets that are necessary for nuclear deterrence are attacked, for example.

As the report bluntly notes, "China intends to use BRI to develop strong economic ties with other countries, shape their interests to align with China's, and deter confrontation or criticism of China's approach to sensitive issues".

Obviously, "some BRI investments could create potential military advantages for China," particularly in the naval context.

China is also likely "to establish additional military bases in countries with which it has a longstanding friendly relationship and similar strategic interests, such as Pakistan".

Chillingly, the report documents that the "PLA … [is] likely preparing for a contingency to unify Taiwan … by force, while simultaneously deterring, delaying, or denying any third-party intervention on Taiwan's behalf".

While none of this is surprising, the level of detail provided in the report offers a clear look at China's escalating ambitions.

It also showcases China's unmistakable savvy in preparing for any eventuality across the full spectrum of conflict locales — investing in technology leadership, expanding military space capabilities, developing indigenous aircraft carriers, leading in international peacekeeping/counter-piracy missions to gain operational knowledge, developing informatisation and cyber attack capabilities, developing both larger range missiles and missile defence, and expanding nuclear weapons delivery possibilities in the event of a first strike.

The report also offers lessons for states in the region seduced by China's economic goodies — there is no free lunch and Chinese gifts might be followed by military commitments.

Mississippi Department of Corrections asks FBI to help investigate 15 inmate deaths
The head of the Mississippi Department of Corrections is now asking the FBI to help investigate the deaths of 15 inmates who died in August.

Pelicia E. Hall, MDOC commissioner, said in a statement Friday that she has been in contact with the FBI and the Mississippi Department of Public Safety regarding the deaths.

Earlier this week, information was released saying 12 prisoners had died while in custody. Two more inmates were added to that list Thursday and one more was added Friday, bringing the total to 15 deaths.

“While we believe that most of the reported deaths during the month of August are from illnesses or natural causes, such as cancer and heart disease, based on available information, we are seeking assistance from others outside the department in the interest of transparency,” Hall said in her statement.

Hall said Tuesday “the number of deaths the department is reporting is not out of line with the number of deaths in previous months.” The latest DOC figures showed 47 inmates died in 2015, 53 died in 2014 and 71 in 2013.

Hall said in a Tuesday statement that the state’s inmate population — 19,425 as of Tuesday — comprises “people from all walks of life and with all types of pre-existing conditions.”

Reports from CNN affiliates suggest that at least one inmate did not die from natural causes.

According to The Clarion-Ledger and DOC, five of the dead prisoners were from Central Mississippi Correctional Facility, three were from the Mississippi State Penitentiary at Parchman, five were from South Mississippi Correctional Institution and one was from Wilkinson County Correctional Facility. It is unknown where one of the inmates was being held.

Of the 15 inmates, one died in prison and nine died at a hospital. It is unknown where five of the prisoners died.

The cause of death for each of the 15 inmates is pending the results of an autopsy.

George Papadopoulos asks for probation for lying to FBI
Ahead of his sentencing next week, former Trump foreign policy adviser George Papadopoulos submitted his sentencing memorandum late Friday night. He is asking the court to give him probation for his charge of lying to the FBI. The memo says he was "young" and lied out of "misguided loyalty to his master." The special counsel has recommended a sentence of up to six months. Papadopoulos is to be sentenced Friday.

The memo adds some detail about Papadopoulos' attempts to set up a meeting between Mr. Trump during the 2016 campaign and Russian President Vladimir Putin. Though he was a member of the campaign's foreign policy team, Trump aides have downplayed his role in the campaign. Aides have said he had no access to Mr. Trump.

Papadopoulos' focus in the campaign was on Russian relations. But having no experience in Russian policy, the filing says that "to say George was out of his depth would be a gross understatement."

Papadopoulos had met with Professor Joseph Mifsud in London, who introduced him to a woman named Olga who had told Papadopoulos she was a niece of Vladimir Putin. The two said they could set up a meeting between the Trump campaign and Russian government officials.

Papadopoulos joined Mr. Trump and then-Sen. Jeff Sessions at the Trump campaign national security meeting on March 31, 2016, the filing says. There, Papadopoulos made the offer to set up a meeting between Mr. Trump and Putin. "Mr. Trump nodded with approval and deferred to Mr. Sessions who appeared to like the idea and stated that the campaign should look into it," the memo reads.

Later, the professor introduced him to Ivan Timofeev, who claimed to have a connection to the Russian Ministry of Foreign Affairs.

At an April 26, 2016 meeting, Mifsud told Papadopoulos that people in Moscow had "dirt," "thousands of emails" on Hillary Clinton, according to the filing.

But the meeting between Mr. Trump and Putin never took place, even though Papadopoulos thought it could be "history making."

During his FBI interview on January 27, 2017, "George found himself personally conflicted during the interrogation." The memo says he gave the FBI "misleading" information about his contact with Mifsud, Olga and Timofeev.

The filing indicates that investigators interviewed the professor and that he denied telling Papadopoulos about the emails.

The special counsel's view of Papadopoulos is that his "lies negatively affected the FBI's Russia investigation" and his "lies were not momentarily lapses," according to a recent government filing.

In cooperating with the government after he was charged, Papadopoulos participated in four proffer sessions with the government.

The memo refers to Alex Van Der Zwaan, who also pleaded guilty to lying to the FBI in connection to Mueller's investigation. Van Der Zwaan was sentenced to 30 days in prison. However, the memo argues that Papadopoulos's actions were "far less egregious."

The memorandum concludes by repeating the words of the special counsel: "He was just a small part of a large-scale investigation."

Finra Suspends South Carolina Broker Who Understated Her Age

In another cautionary tale for brokers looking to cosmetize their personal details, the Financial Industry Regulatory Authority has suspended and fined a South Carolina broker who allegedly lied to three different firms about her age.

Lisbeth “Libby” Cherrington, a retail broker for 27 years who is currently an independent contractor with FSC Securities, agreed to a two-month suspension and $15,000 fine, according to a letter of settlement posted on Finra’s online disciplinary actions site.

Cherrington, who did not return a call for comment at her FSC office in Bluffton, S.C., neither admitted nor denied the allegations in the settlement. Her lawyer, Thomas M. Campbell, declined to comment on details of the case or on the settlement.

Cherrington made headlines in 2014 when she sued Morgan Stanley for discrimination, alleging it created a hostile work environment because of her openly gay lifestyle. Morgan Stanley denied the claim, and counter-claimed in arbitration to collect $6.7 million of promissory notes related to “forgivable loans” she had received.

The claims were resolved in a confidential settlement in May 2016, according to Campbell.

Cherrington provided a false date of birth on various employment applications, personal brokerage account records and investments to Wells Fargo Advisors, Morgan Stanley and FSC while employed at those firms between July 2011 and August 2016, according to the settlement letter that Finra posted on Friday. Her conduct caused the firms to maintain inaccurate books and records in violation of Finra rules, the self-regulatory group said.

A person who claimed to have worked with Cherrington and who spoke on condition of anonymity said she understated her age by six years.

The “acceptance, waiver and consent” letter said her age-alteration began in June 2010 when she “obtained a driver’s license with a false date of birth” that she used to update her personal brokerage accounts at Wells in 2011. She repeated the age-saving information on her WebCRD search consent form at Morgan Stanley and on her background-check fingerprint card when she joined FSC in January 2014, among other documents, Finra said.

The consent letter accused her of exacerbating the problem by telling FSC during an internal investigation that “someone” provided the wrong birth date and her driver’s license was inaccurate because of her “lack of oversight when it automatically renewed.” Cherrington’s conduct violated Finra’s Rule 4511 requiring firms to maintain accurate books and records and its Rule 2010 requiring firms and their associated persons to observe high standards of commercial honor and just and equitable principles of trade, the letter said.

Brokers over the years have stumbled on various vanity issues, including inaccurate information used in registration and marketing materials about their education, military experience and age.

Morgan Stanley last month “permitted” Dallas complex manager Ben Fujihara to resign following allegations about the accuracy of personal background information he provided to the firm and his adherence to receiving permission for outside business activities, according to U5 filings. Fujihara, who declined to discuss the allegations, inaccurately claimed to be a graduate of Texas A&M University, according to several sources.

Cherrington, who FSC said was managing $300 million of client assets when she joined three-and-a-half years ago, had previously been fined $2,000 by the South Carolina Department of Insurance over allegations that she renewed her insurance license application four times with an incorrect birth date, according to Finra.

A spokesperson for FSC, a member of the Advisor Group broker-dealer network, did not immediately return a request for comment.

DEPARTMENT OF JUSTICE
Drug Enforcement Administration
[Docket No. DEA-392]
Bulk Manufacturer of Controlled Substances Application: National Center for
Natural Products Research NIDA MPROJECT
ACTION: Notice of application.
DATES: Registered bulk manufacturers of the affected basic classes, and applicants
therefore, may file written comments on or objections to the issuance of the proposed
registration on or before [INSERT 60 DAYS AFTER PUBLICATION IN THE
FEDERAL REGISTER].
ADDRESSES: Written comments should be sent to: Drug Enforcement Administration,
Attention: DEA Federal Register Representative/DRW, 8701 Morrissette Drive,
Springfield, Virginia 22152.
SUPPLEMENTARY INFORMATION
The Attorney General has delegated his authority under the Controlled Substances
Act to the Administrator of the Drug Enforcement Administration (DEA), 28 CFR
0.100(b). Authority to exercise all necessary functions with respect to the promulgation
and implementation of 21 CFR part 1301, incident to the registration of manufacturers,
distributors, dispensers, importers, and exporters of controlled substances (other than
final orders in connection with suspension, denial, or revocation of registration) has been
redelegated to the Assistant Administrator of the DEA Diversion Control Division
pursuant to section 7 of 28 CFR part 0, appendix to subpart R.
In accordance with 21 CFR 1301.33(a), this is notice that on July 6, 2018, National
Center for Natural Products Research NIDA MPROJECT, University of Mississippi, 135
Coy Waller Complex, P.O. Box 1848, University, Mississippi 38677-1848 applied to be
registered as a bulk manufacturer of the following basic classes of controlled substances:
Controlled Substance Drug Code Schedule
Marihuana Extract 7350 I
Marihuana 7360 I
Tetrahydrocannabinols 7370 I
The company plans to bulk manufacture the listed controlled substances to make
available to the National Institute on Drug Abuse (NIDA) a supply of bulk marihuana for
distribution to research investigators in support of the national research program needs.
No other activities for these drug codes are authorized for this registration.
Dated: August 22, 2018.
John J. Martin,
Assistant Administrator.
[FR Doc. 2018-18983 Filed: 8/30/2018 8:45 am; Publication Date: 8/31/2018]

Federal judge denies states' request to end DACA

A federal judge on Friday declined to order that the U.S. government halt an Obama-era program that shields young immigrants from deportation, marking a blow to President Donald Trump and other opponents of the Deferred Action for Childhood Arrivals program.

U.S. District Judge Andrew Hanen said Texas and six other conservative states that sued to block DACA couldn't prove that allowing the program to continue was causing irreparable harm. The judge questioned the legality of DACA but argued that more harm would be done to DACA recipients if they lost the program.

The judge, who has ruled against DACA-related programs in the past, essentially said the states waited too long to ask for the preliminary injunction.

"Here, the egg has been scrambled. To try to put it back in the shell with only a preliminary injunction record, and perhaps at great risk to many, does not make sense nor serve the best interests of this country," Hanen wrote in his ruling.

But he reiterated that he believes DACA as enacted by former President Barack Obama is unconstitutional.

"If the nation truly wants to have a DACA program, it is up to Congress to say so," Hanen wrote.

The states filed the lawsuit in Texas, hoping Hanen would stop DACA recipients from continuing to renew their enrollment. That would have triggered a conflict with three federal orders that have required the U.S. government to keep accepting DACA renewals, even after Trump tried to end the program last year. Legal experts say such a conflict would have drawn the attention of the U.S. Supreme Court.

The U.S. Department of Justice released a statement Friday commending the judge for addressing the legality of the program.

"As the Justice Department has consistently argued, DACA is an unlawful attempt to circumvent Congress, and we are pleased the court agreed today," spokesman Devin O'Malley said.

With the Trump administration now opposing the program, some states that support DACA - along with the Mexican American Legal Defense and Educational Fund, or MALDEF - intervened in the lawsuit to defend it.

The lawsuit followed the same strategy that stopped an expansion of DACA also proposed by former President Barack Obama's administration. After Obama announced he would create a program protecting the parents of children in the U.S. without legal permission, Texas sued in federal court in Brownsville, Texas, where Hanen is based.

Hanen ended up with that case and ruled the expansion of protections was unconstitutional. In that case, an appeals court upheld his ruling, and the Supreme Court split 4-4 after the death of Justice Antonin Scalia, leaving the ruling in place.

On Friday, Texas Attorney General Ken Paxton said he was confident the courts would ultimately find DACA unconstitutional. He said an injunction was denied only because the states waited too long to request it.

Texas was joined in filing the lawsuit by Alabama, Arkansas, Louisiana, Nebraska, South Carolina and West Virginia. The states argued that Obama, as president, never had the authority to create a program like DACA because it circumvented Congress.

The state also cited costs to educate immigrants, which lawyers for MALDEF argued were "both irrelevant and grossly inflated." The group also said that unlike the program Hanen struck down, which never went into effect, DACA has allowed hundreds of thousands of people to work and pay taxes in the six years since it started. That, the group argued, benefits federal and state governments.

MALDEF said it was happy with the decision and expects the states to appeal to a higher court.

"Today DACA beneficiaries like myself and my little sister breathe a sigh of relief. We all know DACA works," said Greisa Martinez Rosas, the deputy executive director of United We Dream.

Consumer alert: Department of Justice issues warning

It’s scary enough to think you might be a victim of identity theft. What could be worse? How about the idea that those who first alerted you to the problem aren’t who they claim to be?

That’s exactly what the Oregon Department of Justice is warning the public about right now. In their alert, the Financial Fraud/Consumer Protection Section says scammers are impersonating them by calling victims all across the country claiming that they are victims of identity theft. It’s so serious, the DOJ says one woman has already lost her life savings!

The DOJ says the fake agent calls to alert the “victim” of the security breach and claims someone is actively trying to break into their bank accounts. They then instruct the would-be victim to wire all their money to a different bank in a foreign country. To back up their claims, the DOJ says the caller then sends wire transfer instructions and two very convincing documents from the Oregon Department of Justice. They are then told to return those forms to the DOJ office located in Portland.

Make no mistake, this call is a scam. Remember, government officials will never call you first if there is a legitimate concern. They will contact you via mail. Better Business Bureau Northwest + Pacific also urges you to keep the following advice in mind if you are ever contacted in this fashion:

• Confirm on your own. If someone contacts you claiming to be with a certain government group or organization, verify who they are before you give them anything. Do a web search for their contact info and call them directly. Don’t rely on phone numbers or websites given to you, they could be sending you anywhere.

• Be on the lookout for red flags. Typos and grammatical errors, as well as unfamiliar email addresses and scare tactics, are all signs of a phishing scam.

• Protect your personal information. Never share your credit card numbers, Social Security number or even address and phone number with a stranger, especially if they have contacted you unsolicited.

If you think you have fallen victim to this scam, contact the Oregon Department of Justice online at www.oregonconsumer.gov or by phone at (877) 877-9392. For more tips and scam alerts, download the BBB App at bbbapp.org. Anyone who feels they may be a victim of any scheme should report it to local law enforcement and BBB Scam Tracker at bbb.org/scamtracker.

Stephen Mayer is marketplace manager of the Better Business Bureau, serving the Snake River Region from Ontario to Jackson, Wyoming. For more information, visit bbb.org or call (800) 218-1001.

New Castle man caught in Ohio child sex sting

A New Castle resident was among 12 men arrested in Ohio as a result of sting operation aimed at child sexual exploitation.

Adam Dziedzic, 38, faces charges of importuning, attempted unlawful sexual conduct with a minor, and possession of criminal tools, according to a news release from Ohio Attorney General Mike DeWine and Mahoning County Sheriff Jerry Greene.

Dziedzic and 11 others were arrested this week as part of an investigation aimed at preventing child sexual exploitation and reducing demand for sex trafficking. It was led by the Mahoning Valley Human Trafficking Task Force, which is part of Ohio Attorney General Mike DeWine’s Ohio Organized Crime Investigations Commission.

James Norkus, 24, of Salem, a physical education teacher at Kirkmere Elementary School in Youngstown, also is among those facing charges. He was arrested on charges of importuning, attempted unlawful sexual conduct with a minor, and possession of criminal tools.

“It is reprehensible that anyone would arrange to meet with a juvenile for sex, but it is even more appalling when the person facing charges is an elementary school teacher,” DeWine said. “Protecting children is one of my highest priorities, and we will continue to do all we can to stop offenders from harming Ohio’s kids.”

“These types of internet crimes are something that my office takes seriously and personally,” said Mahoning County Sheriff Jerry Greene. “As we have stated before, we are going to continue to pursue and arrest these types of predators who are looking to exploit our children.”

The suspects are all accused of having sexually explicit online conversations with undercover officers posing as juveniles. The suspects all allegedly traveled to a vacant home in Mahoning County with the intent to engage in a sexual encounter with a minor.

The following suspects also were each arrested on charges of importuning, attempted unlawful sexual conduct with a minor, and possession of criminal tools: Naji Alsagoor, 25, Boardman; Robert Canann Jr., 50, Niles; Justin Coyne, 21, Cleveland; Brandon Gorcheff, 26, North Lima; Thomas Maylone Jr., 29, East Liverpool; Kevin McNally, 23, Boardman; Alexander Morlan, 21, New Middletown; Andrew Nuzzi, 22, Girard; Peter Petroff Jr., 47, Boardman; and Edward Webker, 41, Andover. Webker and Nuzzi are also charged with disseminating matter harmful to juveniles for allegedly sending sexually explicit photographs during their online chats with the undercover officers.

The Mahoning Valley Human Trafficking Task Force is led by the Mahoning County Sheriff’s Office and includes representatives from the Austintown Police Department, Howland Township Police Department, Mahoning County Prosecutor’s Office, Ohio Adult Parole Authority, Ohio Bureau of Criminal Investigation, Ohio Investigative Unit, Ohio State Highway Patrol, and the Warren Police Department.

The Ohio Internet Crimes Against Children Task Force also played a large role in conducting the investigation.

Ohr, Steele tried to flip Russian oligarch
Investigators looking for organized crime ties

Justice Department official Bruce Ohr and former British spy Christopher Steele -- frequent targets of President Donald Trump's ire related to the Russia investigation -- were involved in U.S. efforts to flip a Russian oligarch with ties to the Kremlin, The New York Times reports.

Between 2014 and 2016, the FBI and the Justice Department sought and attempted to turn Russian businessman Oleg Deripaska into an informant for the United States, the Times reported Saturday.

Citing current and former officials and associates of Deripaska, the Times reported that investigators were hoping for information from Deripaska on Russian organized crime during a September 2015 meeting and, in a meeting a year later, on possible Russian aid to Trump's 2016 presidential campaign.

The effort to recruit Deripaska was part of a broader, classified U.S. initiative that attempted to gain the cooperation of several Russian oligarchs, the Times reported. The newspaper added that the effort did not seem to have had any successes; Deripaska told U.S. investigators he disagreed with them on Russian organized crime and ideas about possible Russian collusion with the Trump campaign, a person familiar with the exchanges told the Times.

According to the Times, Ohr and Steele first discussed flipping Deripaska in November 2014. Working as an intermediary, Steele helped arrange a meeting between Deripaska and U.S. officials, including Ohr, in 2015, during which Deripaska was asked about the connections between Russian organized crime and Russian President Vladimir Putin's government, the Times reported, citing a person familiar with the events.

The second time U.S. officials made contact with Deripaska was in September 2016, two months after the FBI began investigating Russian interference in the 2016 election, the Times reported.

FBI agents showed up uninvited and unannounced at a home Deripaska has in New York and grilled the Russian oligarch about whether his former business partner, Paul Manafort, had worked as a liaison between Russia and the Trump campaign, according to the newspaper. Weeks earlier, in August, Manafort left Trump's campaign, which he had led for five months.

Deripaska told investigators their theories about Manafort's role on the campaign were "preposterous" and disputed any potential connections between Russia and the Trump campaign, a person familiar with the exchange told the Times.

The officials, who spoke to the Times on the condition of anonymity in order to discuss the classified effort, told the Times they were afraid that revealing the effort could undermine national security. But they also said they did not want the secret nature of the program to allow Trump and his Republican allies to "cherry-pick facts and present them, sheared of context, to undermine special counsel Robert Mueller's investigation" into Russian interference, the newspaper reported. Trump has often criticized the special counsel probe as a "witch hunt" and has repeatedly attacked Ohr and Steele.

Ohr, a 30-year Justice Department veteran, is being scrutinized for his meetings with Steele, the former British intelligence officer who compiled an infamous dossier on Trump and Russia, and Glenn Simpson, the founder of Fusion GPS, the firm that hired Steele to do research on Trump. Ohr's wife, Nellie, was also a contractor for Fusion GPS.

Republicans have charged that the Steele dossier, which contains some salacious and unverified intelligence on Trump and Russia, was inappropriately used by the FBI to obtain a Foreign Intelligence Surveillance Act warrant on former Trump campaign adviser Carter Page.

The President and some House Republicans who are vocal critics of the Russia investigation have also seized on Ohr and Steele's connection as proof of an untoward association between government officials and the roots of the special counsel's investigation.

Disbarred Attorney Convicted For Scheme To Defraud Clients Of More Than $750,000
Greenbelt, Maryland – A federal jury today convicted former attorney Saundra Lucille White, a/k/a Lucille Parrish-White and six variations of those names, age 57, of Lothian, Maryland, on charges of mail fraud, wire fraud, money laundering, and aggravated identity theft in connection with a scheme to defraud clients of at least $750,000.

The conviction was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Robert Geary of the Treasury Inspector General for Tax Administration; Anne Arundel County Police Chief Tim Altomare; and Chief Mark A. Magaw of the Prince George’s County Police Department.

According to the evidence presented at White’s seven day trial, in March 2010, White agreed to assist Victim H to obtain guardianship for a relative (Victim M) who had been incapacitated by a stroke. At White’s request Victim H provided White with an accounting of Victim M’s assets. With White’s assistance, Victim H obtained guardianship of Victim M a short time later. Victim M died on January 7, 2011. White was disbarred from the practice of law in the District of Columbia on January 20, 2011 and disbarred in Maryland on September 9, 2011. White did not inform Victim H of her pending disbarment, nor did she tell Victim H that she was no longer a licensed attorney.

According to trial evidence, from March 2010 through May 2013, White created fraudulent tax notices that purported to be from the Internal Revenue Service, and demanded payment of taxes purportedly owed by Victim M and by a deceased relative of Victim M. The notices required that payments be sent to an entity called Intel Realty Financial Services (IRFS) at a mailbox in Annapolis, Maryland, controlled by White. White then mailed and faxed the fraudulent tax notices to Victim H, advising Victim H that in her role as legal guardian of Victim M, she was required to remit payments for these taxes to the address in the notice. Once White obtained the checks sent by Victim H in response to the fraudulent tax notices, totaling $750,000, she deposited them in the bank accounts she opened in the names of IRFS and Victim M. White withdrew the funds from the bank accounts, forging Victim M’s signature on checks made out to White, other entities controlled by White, a family member, or otherwise for White’s benefit. White also obtained debit cards in Victim M’s name and attempted to obtain a Maryland driver’s license in the name of Victim M, but bearing White’s photograph. White used some of the money to purchase luxury items, including a $20,500 check used as a down payment for a 2011 Silver Volvo C70 hard-top convertible.

White faces a maximum sentence of 20 years in prison for each of three counts of mail fraud, one count of wire fraud, and two counts of money laundering; and a mandatory two years in prison, consecutive to any other sentence, for aggravated identity theft. U.S. District Judge Paul W. Grimm has scheduled his sentencing for January 25, 2016.

Today’s announcement is part of the efforts undertaken in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.

United States Attorney Rod J. Rosenstein commended TIGTA, the Anne Arundel County Police Department, and Prince George’s County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Thomas P. Windom and Special Assistant U.S. Attorney James I. Pearce of the U.S. Department of Justice, who are prosecuting the case.

Miami Heat place executive on leave amid FBI investigation for alleged complex money-laundering scheme
Jeff David is being investigated for 'suspicious financial transactions' when he worked for the Sacramento Kings

A Miami Heat executive has been placed on administrative leave after coming under investigation for an alleged money-laundering scheme he perpetrated while working for the Sacramento Kings. Jeff David, who currently holds the title of "chief revenue officer" in Miami, is suspected of stealing $13.4 million by diverting the money away from team sponsorships. Via the Sacramento Bee:

A former top executive of the Sacramento Kings is suspected of siphoning off $13.4 million from two of the team's top sponsors and using the funds to purchase beachfront property in Southern California, sources have told The Sacramento Bee.

The FBI and federal prosecutors are investigating Jeffrey R. David, 44, the former chief revenue officer for the Kings who currently holds the same position with the NBA's Miami Heat, for what sources say was a sophisticated money-laundering scheme that allegedly diverted $9 million from the Golden 1 Credit Union and another $4.4 million from Kaiser Permanente Foundation.

As of Thursday, charges had still not been filed, but the Kings released a statement acknowledging the investigation.

"Last week, we alerted federal law enforcement to suspicious financial transactions involving a former Kings employee, Jeff David," the team said. "That investigation is underway and on Monday, U.S. Department of Justice authorities began the formal process of recovering and seizing the properties involved in the investigation.

The Heat also released a statement saying they are cooperating with the authorities, and have placed David on leave. Via the Sun-Sentinel:

"We are aware of the investigation of Jeff David, which focuses on events that took place prior to his joining our team," the statement forwarded to the Sun Sentinel reads. "We are fully cooperating with the authorities. Jeff David is on leave, pending the outcome of the investigation."

Per the Sentinel, David has spent 12 years working in the NBA, and previously served in similar financial-related roles for the Columbus Crew of Major League Soccer and the AVP Pro Beach Volleyball Tour.

Walmart “asset protection manager” from Aurora convicted of fraud and money laundering
Judge orders 22-month federal prison sentence, $830,000 restitution

A 40-year-old Aurora man who worked for Walmart has been sentenced to 22 months in federal prison for wire fraud and money laundering. He also has been ordered to pay $830,000 restitution.

Justin Manning also was ordered by U.S. District Judge Wiley Y. Daniel to three years of supervision after completion of his incarceration, according to a news release from the U.S. attorney’s Colorado office.

Manning was employed as an asset protection manager and assistant store manager at a local Walmart between 2012 and 2015, according to an indictment in the case. Manning had access to blank checks in his job positions. He fraudulently filled out checks and had others fill out checks in the names of third parties to deceive Walmart employees that the checks were legitimate.

Manning used his management position to access the store’s safe and take cash from deposit bundles, the news release stated. Manning created fake loans to one of the store’s cash registers to conceal that cash was missing from the safe. Manning then placed in those cash registers fraudulent Money Network Checks totaling the same amount as the cash taken so the balance would look correct and other employees would not realize cash had been taken from the safe.

The case was investigated by the IRS.

“The role of IRS Criminal Investigation becomes even more important in embezzlement and fraud cases due to the complex financial transactions that can take time to unravel,” said Steven Osborne, special agent in charge of the Denver Field Office. “This sentence shows there are detrimental consequences for individuals who engage in financial fraud.”

Assistant U.S. Attorney Pegeen Rhyne prosecuted the case.

Penn Hills man accused of illegal gun and drug sales, money laundering

A Pittsburgh man was indicted by a federal grand jury of illegally having and selling a guns, including a machine gun, and drugs.

Anthony “Poundcake” Bentley, 43, of Curtis Street, is the only person named in the 9-count indictment that was made public Tuesday.

Bentley is accused of trading or selling guns and ammunition even though he isn’t legally allowed to have either.

The 32 guns authorities accuse Bentley of having or selling include 23 handguns, a fully-automatic Colt rifle, and eight other rifles or shotguns.

Prosecutors allege that, between May 2015 to January 2016, Bentley also engaged in a drug trafficking conspiracy involving 11 pounds or more of cocaine.

He also is accused of buying a commercial property at on Laketon Drive in Penn Hills for about $156,000; $86,000 for his house on Curtis Street; $25,000 for an Idelwild Street house in Pittsburgh, and about $14,000 for property at Iowa Street, also in the city, in an attempt to launder his illegal money.

Assistant U.S. Attorney Eric G. Olshan is prosecuting this case on behalf of the government.

A federally-administered Organized Crime and Drug Enforcement Task Force conducted the investigation. The task force included officers from the Drug Enforcement Administration, Homeland Security Investigations, Internal Revenue Service – Criminal Investigation, and Bureau of Alcohol, Tobacco, Firearms and Explosives in partnership with state and local law enforcement agencies, including the Allegheny County Police Department, Pittsburgh Police, and the Pennsylvania State Police.

Prosecutor seeks prison sentence for "toy smuggler" for money laundering
Finnish-Syrian Rami Adham spent fundraising money on a garden allotment and transferred some of it to a Turkish account, the prosecution alleges.

Lelusalakuljettaja Rami Adham Helsingin käräjäoikeudessa.
Rami Adham at Helsinki District Court on 28 August 2018. Image: Irene Stachon / Lehtikuva
A Helsinki prosecutor is seeking a prison sentence for so-called "toy smuggler" Rami Adham for 18 crimes, including aggravated money laundering and collection of funds without a fundraising permit. The judicial process against the Finnish-Syrian started at Helsinki District court on Tuesday.

In 2014-2016, Adham served as chair of the Finnish-Syrian Association, which raised funds for people in the war-ravaged Syria.

According to the prosecutor, Adham’s claim that most of the funds raised would go directly to people in Syria was misleading and untruthful.

Instead, 62,000 euros were spent on a garden allotment hut and 54,000 euros ended up in Adham’s account in a Turkish bank, the prosecutor argues, while a portion of the money was used to pay rent of Adham’s office. In addition, the prosecution says Adham gave false information to the authorities about the association’s board, as the woman named as treasurer in reality held no position of authority in the group.

Last year, Adham received a suspended sentence for tax fraud, drug and doping offences, false accounting, attempted extortion and two assaults. That sentence is not yet legally valid.

Before allegations of wrongdoing came out in late 2016, Adham was hailed by local and international media for his efforts to deliver toys into occupied Aleppo.

Money laundering charges against Panama Papers city council member

Former Reykjavík City Council member for the Independence Party, Júlíus Vífill Ingvarsson, is charged with money laundering by keeping amounts of ISK 131-146 million (USD 1.2-1.4 million, EUR 1-1.2 million) in a foreign bank account, an amount that was partly illegally obtained, and to have transferred the money to the bank account of a trust in Switzerland.

This is revealed in charges against him by the Office of the District Prosecutor, a document obtained by mbl.is.

Júlíus Vífill resigned as city council member in 2016 in the wake of the Panama Papers, (millions of leaked documents from a Panama law firm, detailing information about off-shore companies and accounts), which revealed that he had established and off-shore company in Panama.

Júlíus is said to have kept the money, which was in US dollars, Euros and Pounds, in his bank account at UBS bank on the offshore island Jersey in the English Channel, from 2010 to 2014. He is said to have transferred the money to a bank account, belonging to the trust Silwood Foundation at the bank Ju­lius Bär in Switzerland. The beneficiaries of the account were Júlíus, his wife and children.

The amounts in question were earned several years earlier, but had not been reported as taxable income. As a result, he did not pay income tax, local tax or interest on them. The charges state that the illegally obtained amount, on which taxes were evaded, plus interest, amounted to ISK 49-57 million (USD 458-533 million, EUR 391-455 million).

The charges state that money laundering is punishable, according to Article 264 of the Penalty Code, and that a law enacted in 2009 expand the area to which the article applies. Thus, it now applies to gain from all punishable acts, in addition to the maximum sentence having been increased to six years. At the same time, money laundering of the gain from one’s own illegal activity was made punishable.

The document states that the alleged tax evasion took place in 2006 or earlier. Since the statute of limitations has expired, Júlíus cannot be charged with violating the tax law. That doesn’t change the fact that the part of the money that should have been paid in income taxes and local taxes, in addition to gain from interest and foreign exchange gain is the product of Júlíus’ money laundering violation.

The charges state that Júlíus has admitted to failing to report the amount on his tax return, but he has refused to reveal when he obtained the money. Therefore, the exact amount of his gain cannot be precisely estimated.

Trudeau asks Blair to fight money laundering in B.C. in bid to stop organized crime

Prime Minister Justin Trudeau has handed new Minister Bill Blair a mandate to fight organized crime money laundering, specifically in British Columbia, in “efforts to counter guns, gangs and opioid distribution.”

The release of Blair’s mandate letter, which also includes directions for reducing gun violence, and handling irregular migration, highlights the engagement of Trudeau’s government in a crisis of money laundering connected to B.C. Lottery casinos.

In July Blair, a former Toronto chief of police, was appointed new minister of border security and organized crime reduction.

Trudeau’s mandate to Blair states: “You will be expected to work closely with provinces, territories, and municipalities, as well as community organizations, law enforcement and border agencies. This work should include a focus on cutting off money laundering which, as we have seen recently in British Columbia, supports our efforts to counter guns, gangs and opioid distribution.”

It’s not immediately clear how Blair plans to tackle B.C.’s money laundering problems. Over the past year there have been discussions within B.C.’s government about starting a money laundering task force with assistance from Ottawa, or requesting funds to increase the number of RCMP officers focused on crimes connected to money laundering.

“Anti-money laundering is primarily a federal responsibility and B.C. would welcome new federal policing investments to restore the RCMP’s federal capacity to investigate trans-national money laundering,” B.C.’s Ministry of Public Safety and Solicitor General stated, in response to questions from Global News.

The schemes involve transnational gangs based in China, Hong Kong and Macau, with criminals involved in fentanyl importation and trafficking in Canada.

Global reported in April: “Criminal syndicates that control chemical factories in China’s booming Guangdong province are shipping narcotics, including fentanyl, to Vancouver, washing the drug sales in British Columbia’s casinos and high-priced real estate, and transferring laundered funds back to Chinese factories.”

The B.C. money laundering schemes also involve offshore and underground banking networks with connections between Richmond, Hong Kong, and Guangdong businesses, Global’s investigations show.

And there are also connections between VIP gamblers from China used in the casino laundering schemes, and gun trafficking in B.C., according to legal cases and law enforcement sources.

Earlier this year, B.C. Attorney General David Eby testified in Ottawa, and informed senators that the unique money laundering method seen in B.C. casinos had become known internationally as the “Vancouver Model.”

This method is similar to money laundering seen in Macau casinos. Wealthy gamblers from China, sometimes including crime bosses and corrupt officials, are given suspected drug cash loans to buy chips in B.C. casinos, by loan shark networks. The so-called “whale gamblers” can pay back these loans in China, with little or no interest.

The loans are also secured by the lenders, by taking out mortgages against luxury real estate or vehicles in B.C.

Last September, Eby ordered an independent review into B.C. casino money laundering after an audit showed about $14 million in suspicious cash had flowed through Richmond’s River Rock Casino in July 2015.

Reviewer Peter German, a former RCMP executive, filed a scathing report confirming that Chinese organized crime networks with roots in Guangdong, Macau and Hong Kong, laundered at least $100 million through loan sharks and VIP gamblers in B.C. Lottery casinos. German has since told Global News that the $100 million figure was likely a low estimate.

Trudeau asks Blair to fight money laundering in B.C. in bid to stop organized crime

Prime Minister Justin Trudeau has handed new Minister Bill Blair a mandate to fight organized crime money laundering, specifically in British Columbia, in “efforts to counter guns, gangs and opioid distribution.”

The release of Blair’s mandate letter, which also includes directions for reducing gun violence, and handling irregular migration, highlights the engagement of Trudeau’s government in a crisis of money laundering connected to B.C. Lottery casinos.

In July Blair, a former Toronto chief of police, was appointed new minister of border security and organized crime reduction.

Trudeau’s mandate to Blair states: “You will be expected to work closely with provinces, territories, and municipalities, as well as community organizations, law enforcement and border agencies. This work should include a focus on cutting off money laundering which, as we have seen recently in British Columbia, supports our efforts to counter guns, gangs and opioid distribution.”

It’s not immediately clear how Blair plans to tackle B.C.’s money laundering problems. Over the past year there have been discussions within B.C.’s government about starting a money laundering task force with assistance from Ottawa, or requesting funds to increase the number of RCMP officers focused on crimes connected to money laundering.

“Anti-money laundering is primarily a federal responsibility and B.C. would welcome new federal policing investments to restore the RCMP’s federal capacity to investigate trans-national money laundering,” B.C.’s Ministry of Public Safety and Solicitor General stated, in response to questions from Global News.

Global News has reported extensively on revelations of money laundering in B.C. over the past year.

The schemes involve transnational gangs based in China, Hong Kong and Macau, with criminals involved in fentanyl importation and trafficking in Canada.

Global reported in April: “Criminal syndicates that control chemical factories in China’s booming Guangdong province are shipping narcotics, including fentanyl, to Vancouver, washing the drug sales in British Columbia’s casinos and high-priced real estate, and transferring laundered funds back to Chinese factories.”

The B.C. money laundering schemes also involve offshore and underground banking networks with connections between Richmond, Hong Kong, and Guangdong businesses, Global’s investigations show.

And there are also connections between VIP gamblers from China used in the casino laundering schemes, and gun trafficking in B.C., according to legal cases and law enforcement sources.

Earlier this year, B.C. Attorney General David Eby testified in Ottawa, and informed senators that the unique money laundering method seen in B.C. casinos had become known internationally as the “Vancouver Model.”

This method is similar to money laundering seen in Macau casinos. Wealthy gamblers from China, sometimes including crime bosses and corrupt officials, are given suspected drug cash loans to buy chips in B.C. casinos, by loan shark networks. The so-called “whale gamblers” can pay back these loans in China, with little or no interest.

The loans are also secured by the lenders, by taking out mortgages against luxury real estate or vehicles in B.C.

Last September, Eby ordered an independent review into B.C. casino money laundering after an audit showed about $14 million in suspicious cash had flowed through Richmond’s River Rock Casino in July 2015.

Reviewer Peter German, a former RCMP executive, filed a scathing report confirming that Chinese organized crime networks with roots in Guangdong, Macau and Hong Kong, laundered at least $100 million through loan sharks and VIP gamblers in B.C. Lottery casinos. German has since told Global News that the $100 million figure was likely a low estimate.

Feds sentence California man for drug trafficking, money laundering

A California man is spending the next 10 years behind bars after pleading guilty to drug conspiracy and money laundering charges in 2017.

Chief U.S. District Judge Timothy M. Burgess sentenced Enrique Ayon Duenas, 61, on Thursday for his role in trafficking controlled substances,including heroin and methamphetamine, from California to Anchorage, according to a statement from the office for U.S. Attorney Bryan Schroder.

According to court documents, Duenas agreed with co-conspirators to distribute controlled substances including 1,000 grams or more of heroin and 500 grams or more of methamphetamine from sources in California to people in Alaska.

"Additionally, Duenas and others laundered the proceeds from the illegal sale of narcotics through financial institutions located in Alaska and California, with the purpose of concealing the true nature of the money," according to court documents. "For example, the money was laundered by transferring it between Alaska and California by various means, including bank deposits made in Alaska into bank accounts in other people’s names, and thereafter by withdrawals in California."

Two additional co-conspirators received sentences for drug conspiracy. Juan Carlos Hernandez was sentenced to 44 months in prison on April 14 and Oscar Josue Maldonado was sentenced to two years in prison on February 27.

Duenas must serve 10 years in prison followed by five years of supervised release.

The Bureau of Alcohol, Tobacco, Firearms and Explosives, Homeland Security Investigations, and IRS Criminal Investigation helped conduct the investigation. The case was prosecuted by Assistant U.S. Attorney Stephan A. Collins.

Iran Expected to Lift Cryptocurrency Ban in September

The deputy for innovative technologies at the Central Bank of Iran, Nasser Hakimi, has stated that Iran’s financial regulator will be reviewing the country’s blanket cryptocurrency ban. The central bank official also indicated that the country’s regulatory apparatus pertaining to virtual currencies is expected to be finalized by the end of September.

Iranian Central Bank Official Hints That Cryptocurrency Ban May Be Repealed During September
Whilst speaking at a conference on cryptocurrency and distributed ledger technology in Tehran on Sunday, Nasser Hakimi, the Central Bank of Iran’s deputy for innovative technologies, made statements inferred as indicating that the Iranian administration will likely repeal its blanket ban on cryptocurrencies during September.

“The first concerns the prevalent global cryptocurrencies. The High Council of Anti-Money Laundering has imposed a ban in light of concerns over global allegations of money laundering and financing of terrorism. But it seems that after the government’s consideration, this blanket ban will be reviewed,” Mr. Hakimi stated.

The blanket ban, first announced on April 22nd of this year, was ostensibly intended to address concerns pertaining to money laundering and financing of terrorism.

Iran Expected to Lift Cryptocurrency Ban in SeptemberThe cryptocurrency ban is expected to be lifted when Iran announces the finalization of its new regulatory apparatus pertaining to cryptocurrencies, which is currently slated to occur by the end of September.

According to Financial Tribune, Iran’s new cryptocurrency policies have been developed under the guidance of President Hassan Rouhani.

Iran Expected to Lift Cryptocurrency Ban in SeptemberMr. Hakimi also discussed the possibility of Iran’s current position regarding the development of a state-issued cryptocurrency, stating: “National virtual currencies haven’t proved successful experiences in the world, but some economic officials have emphasized on this, so the Informatics Services Corporation has readied a test edition and some other entities are also cooperating in this.”

Saeed Mahdiyoun, an official representing Iran’s Supreme Cyberspace Council, also recently indicated that the country’s cyberspace authority was actively exploring the idea of introducing a national cryptocurrency.

13 indicted on gang charges, including 2017 killing of bartender in Canton

A grand jury indicted 13 people on gang charges — including in the June 2017 killing of bartender Sebastian Dvorak in Canton — following a yearlong investigation into a Bloods gang subset in East Baltimore, prosecutors said Monday.

The investigation into the “500” or “500 L” gang subset by the state attorney general’s Organized Crime Unit, the Baltimore Police Department and the FBI involved wiretaps and undercover drug and gun buys — including heroin, fentanyl, cocaine, oxycodone, marijuana, synthetic drugs and a sawed-off shotgun, prosecutors said.

The group, which involved both Bloods gang members and non-members, had operated since 2014 primarily in the 500 block of North Rose Street in the McElderry Park neighborhood, several blocks east of the Johns Hopkins Hospital, prosecutors said.

Malik Mungo, 18, of the 1500 block of Lochwood Road in Northeast Baltimore, faces more than a dozen criminal charges, including first- and second-degree murder in the killing of Dvorak in the 2500 block of Boston Street, on the night of Dvorak’s 27th birthday.

Recent homicide victims in Baltimore include mother of bullied boy, bartender at Ryleigh's
Dvorak was a bartender at several Ryleigh's Oyster locations, including in Mount Vernon and Hunt Valley. Prosecutors said he was robbed and shot by Mungo and an associate while walking home after celebrating his birthday.

“This gang ran a sophisticated operation, engaging in drug and gun trafficking, robbery, and murder,” Attorney General Brian E. Frosh said in a statement. “After countless hours of hard work, we are able to bring a small amount of justice to Sebastian Dvorak’s loved ones and hold these defendants accountable for their actions.”

Mungo did not have any attorney listed in online court records, and a voice mail message left Monday at a number listed for his address was not returned.

Dvorak’s grandfather, Bernard Dvorak Sr., 81, of Towson, said the closure of the case will be “a relief, if they have the actual criminals.”

“We’re just saddened by the whole thing,” he said. “We lost great friend and family member for no good reason.”

Bartender Sebastian Dvorak was killed on his 27th birthday. An 18-year-old has been charged with his murder (HANDOUT)
Prosecutors said that members of the group also were involved in the September 2016 stabbing death of Gerrod Greenwood, and the subsequent intimidation of a witness in the case.

Prosecutors said Wayne Zeigler stabbed Greenwood on Sept. 1 during a fight in the 7800 block of Eastern Avenue in Baltimore County. He was arrested and charged in the case, then learned the identity of a witness while jailed at the Baltimore County Detention Center and shared it with other members via mail, prosecutors said.

Gregory Randle, 34, who went by the nickname “Don Pablo” — an apparent reference to the Colombian drug lord Pablo Escobar — posted photos to social media of paperwork Zeigler had sent from jail that identified the witness in the case, prosecutors said.

“Among the postings was a picture of the witness, the witness’s information sheet that contained identifying information, as well as portions of a transcript of the witness’s statement given to police,” prosecutors wrote in the indictment.

In the social media post, Randle labeled the witness a “rat,” highlighted a section of the witness’ statement that mentioned Randle, and tagged other members of the gang to bring it to their attention, prosecutors said.

Also indicted were Clinton Davis, 36; Joseph Flowers, 38; Duwarn Holt, 29; Markeece Jordan, 25; Robert Lewis, 38; Vernon Miller, 29; Dante Neal, 21; Harvey Turner, 28; Keith Worthington, 33; Lienell Young, 33; and Timothy Zeller, 36.

Members of the group are also accused of plotting and committing crimes against one another.

No attorneys were listed for any of the defendants. All are being held without bond, according to court records.

Reserve Bank of India Launches Cryptocurrency Research Unit

India’s cryptocurrency saga has taken another unique turn. According to the Economic Times, the country’s central bank has established a new research unit dedicated to blockchain and cryptocurrency, a sign policymakers are exploring new pathways for regulating disruptive technologies.

Discreet Formation
Under the direct supervision of the Reserve Bank of India (RBI), the new research unit has been tasked with not only exploring emerging technologies but possibly draft rules for their implementation.

“As a regulator, the RBI also has to explore new emerging areas to check what can be adopted and what cannot,” an unnamed source told the Economic Times. “A central bank has to be on top to create regulations. This new unit is on an experimental basis and will evolve as time passes.”

Although the RBI confirmed as far back as September that research into cryptocurrencies was underway, officials have been heavily criticized for their lack of guidance in regulating digital assets. An information request submitted back in April found that the RBI implemented new cryptocurrency regulations without conducting research or consulting experts.

Since early July, state-regulated financial institutions have been barred from servicing digital currency exchanges and their lenders. The new regulation essentially stamps out fiat-to-crypto transactions. As Hacked reported earlier month, black market methods such as Dabba have rushed to fill the void.

Detailed Guidelines Expected
Public and anonymous sources close to the Indian government have confirmed that a blanket ban on cryptocurrency dealings is unlikely to continue in the future. Last month, a senior official from India’s Ministry of Finance confirmed that new cryptocurrency guidelines are already being developed and could be introduced as early as September. It has even been reported that digital assets may be regulated as commodities, which would allow authorities clampdown on money laundering.

A senior official with India’s Department of Economic Affairs had previously stated that a draft bill will be presented to lawmakers in early July. It is not yet clear whether policymakers have reviewed the proposed guidelines.

The future of India’s cryptocurrency market is up in the air as digital currency exchanges, traders and lenders await a final Supreme Court decision on the matter. In July, the Supreme Court upheld the RBI’s blanket ban on crypto dealings despite several exchanges petitioning to get it revoked. Exchanges argued that the RBI’s policy is arbitrary and unconstitutional.

State trooper linked to drug deals has resigned

A state police trooper who did not disclose her past involvement in a large-scale drug-dealing operation resigned Friday and received a dishonorable discharge, after an internal investigation found she lied to the department during the hiring process.

Leigha Genduso, a Shrewsbury High graduate, resigned before she could be fired for providing “untruthful information ... including her connection to and participation in narcotics dealing and her own drug use,” to the department during her hiring process, a state Police Internal Affairs Investigation concluded last week, according to State Police spokesman Dave Procopio.

“Information gathered in the investigation, including Ms. Genduso’s own statements, indicate that she did not disclose her past involvement in a drug dealing operation to any member of the Massachusetts State Police and that she made demonstrably false statements regarding her past involvement in criminal activities on the application,” Procopio said in a statement Friday night.

When she was being hired, Genduso did not reveal that she had participated in a large-scale marijuana business run by her live-in boyfriend in the early 2000s. State police said she lied about her past involvement in criminal activities on the application.

Information about Genduso’s criminal past was publicly available: In a 2007 federal case she testified against her then-boyfriend, Sean P. Bucci, of North Reading. That testimony enabled her to avoid prosecution for her participation in the enterprise, which she said in court documents included helping package, transport and sell marijuana, as well as launder some of the proceeds.

Bucci was convicted of conspiracy to possess with intent to distribute more than 1,000 kilograms of marijuana, possession with intent to distribute over 1,000 kilograms of marijuana, conspiracy to commit money laundering, two substantive counts of money laundering, seven substantive counts of structuring currency transactions and four counts of tax evasion.

In the wake of the scandal, the state police have created a new checklist for the background check process, and broadened the questionnaire for recruit candidates to include questions about involvement in any criminal investigation, even if the candidate was not charged with a crime. The department also has approached federal law enforcement agencies about the possibility of searching their investigative records for any reference to state police recruit candidates.

The State Police Internal Affairs Investigation sustained multiple charges against Genduso and had begun termination proceedings before Genduso resigned, according to state police.

Genduso was hired as a dispatcher in 2008. She graduated from the academy in 2014 and was assigned to the state police K-9 section, where she remained until being suspended without pay in February.

Genduso earned more than $150,000 in 2017, according to state payroll records.

Dubuque Man Sentenced to 20 Years’ Prison for Meth Trafficking and Money Laundering
Shipped cash to Phoenix, Arizona, for approximately a year in exchange for over
A man who trafficked at least 50 pounds of methamphetamine in the Dubuque, Iowa, area was sentenced yesterday to 20 years in federal prison.

Derek Richard Rath, age 35, from Dubuque, received the prison term after an August 23, 2018, guilty plea to conspiracy to distribute methamphetamine near a school and conspiracy to commit money laundering.

Court documents and evidence presented at the sentencing hearing established that in June 2016, Rath obtained the phone number of codefendant Anthony Robert McCarron in Phoenix. Shortly after, Rath and McCarron agreed that Rath would pay McCarron to ship packages of ice methamphetamine to several addresses in Dubuque. McCarron mailed at least 50 pounds of methamphetamine to Rath between July 2016 to July 2017.

Rath paid for the methamphetamine by mailing packages of cash to McCarron. In all, Rath and McCarron mailed at least 56 packages, sometimes using aliases on the shipping labels. They also wired thousands of dollars to each other with MoneyGram, Western Union, and Walmart2Walmart.

Rath was sentenced in Cedar Rapids by United States District Court Chief Judge Leonard T. Strand to 240 months’ imprisonment. He must also serve a 10-year term of supervised release after the prison term. There is no parole in the federal system. Rath is being held in the United States Marshal’s custody until he can be transported to a federal prison.

The case was prosecuted by Special Assistant United States Attorney Drew O. Inman and investigated by the Dubuque Drug Task Force, the Iowa Division of Narcotics Enforcement, and the Federal Bureau of Investigation. Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 17-CR-1042-LTS.

WV State Police seize $10K from couple without charging them with a crime

Dimitrios Patlias (left) and Tonya Smith were pulled over by a West Virginia State trooper on June 9. The trooper took from the couple $10,478 in cash and the 78 gift/rewards cards they had with them.

A West Virginia State Police trooper issued Dimitrios Patlias a warning for failing to drive within his lane, just before seizing more than $10,000 in cash from him and his wife.

On June 9, Tonya Smith — who was almost eight months pregnant — and Patlias were headed to the Hollywood Casino in Jefferson County. They had capitalized on several promotional offers and had 13 and 14 (respectively) $100 gift cards on them, along with the cash.

The trooper pulled them over, Smith said in an interview, and ranged from accusing them of smuggling cigarettes, to having drugs in the car, to gift card fraud. After searching the car, their persons, and Smith’s purse, the trooper let them go with a uniform warning citation.

However, he also took the $10,478 in cash, the 78 “gift cards” in the car, and Patlias’ smartphone, according to a property disposition report. Smith said 27 of those cards were gift cards, the rest of them were the kind of rewards program cards you get from any chain business.

Patlias and Smith wound up returning to their home in Egg Harbor City, New Jersey, stripped of all their cash but $2, without ever having been charged with a crime.

“It was a disgusting way of being treated,” Smith, a nurse, said. “We work hard for our money.”

The seizure was part of a practice known as civil asset forfeiture, where law enforcement officers have the right to lay claim to property they argue was used in the commission of certain crimes.

Under the West Virginia Contraband Forfeiture Act, once property is seized by an officer, authorities can file a motion in civil court — separate from criminal proceedings — to claim the property via forfeiture.

The unusual nature of the proceedings leads to some strange case titles. For instance, in Morgan County, Assistant Prosecuting Attorney Raymond Boyce initiated one case in circuit court, naming a Hyundai Elantra, an ignition key, a cell phone, a digital scale, and $523 in U.S. currency as respondents.

In that case, the court granted the forfeiture. The Morgan County Sheriff’s Department received 90 percent of proceeds, and the prosecutor’s office received the other 10 percent, as per state code.

Once a prosecutor initiates a forfeiture proceeding, the person whose property was seized will likely need legal aid to file motions in response to reclaim their property, where the cost of a lawyer often outweighs the value of the goods seized. Upon 30 days of inaction after the prosecutor’s motion, the property is forfeited to the state by default.

Even if suspects are acquitted of the charges filed against them, they still need to go through the civil procedure to reclaim their property.

In February, the state House Judiciary Committee considered a bill that would tie civil asset forfeiture to its respective criminal proceeding, i.e., if you’re acquitted criminally, the seized property cannot be forfeited. The bill died in committee.

Those in support of the practice say the ability of law enforcement officers to use forfeiture laws can hamstring drug dealing networks by leaning on their finances, which can be more effective than criminal charges. They also point out that the proceeds can help police buy much-needed equipment.

Smith said the law seems to incentivize bad behavior from otherwise good police officers.

“To me, this law, now that I’ve learned of it, it turns police officers into dishonest crooks,” she said. “I feel like I was in a movie.”

After the Gazette-Mail reached out to the state police Monday with inquiries about the seizure, and after weeks of Smith calling police, the Jefferson County prosecuting attorney and local politicians, Smith said an officer returned her and Patlias’ possessions in full Thursday evening.

When asked a number of questions about the seizure of Patlias and Smith’s property Tuesday, a state police spokesman confirmed the details but said he did not know whether the seized property had yet been forfeited.

“A complaint was made by Mr. Patlias, and an active IA investigation is ongoing,” he said.

Matt Harvey, the Jefferson County Prosecutor, said the state police notified his office informally of Smith and Patlias’ seizure, and he and his staff declined to make any effort toward forfeiture.

The West Virginia branch of the American Civil Liberties Union, which lobbied on behalf of the asset forfeiture reform bill, filed Freedom of Information Act requests to a host of police stations and sheriff’s offices around West Virginia, which were provided to The Charleston Gazette-Mail.

The documents obtained and accompanying responses show most agencies don’t have any espoused policy or training for officers regarding asset forfeiture. There is no statewide tracking system, and recording varies by county and municipality.

While most records indicated goods were forfeited in accordance with convictions, this was not an absolute rule.

Many of the seizures involved amounts of cash in the ballpark of $1,000. Many of them included automobiles.

The Berkeley County Sheriff’s Office said it could not produce a comprehensive list of all items forfeited. However, in the list it could provide, the property included cash, a 55-inch LG TV and a 1997 Ford Thunderbird.

The Monongalia County Sheriff’s office sold a long list of property, which included forfeited and abandoned assets, at an auction. The list included a Nintendo Wii with controllers, shoes, jumper cables, a Mickey Mouse watch, a jogging stroller, Legos and others. Regardless of how it was obtained, all the funds went into a forfeiture account.

Most counties said they had no written policy to provide regarding training or general procedure with seizures and forfeitures.

“The Sheriff’s Department does not have any documents relating to internal policies, guidance, guidelines or training regarding the process of civil seizure and forfeitures,” wrote Jennifer Scragg Karr, assistant prosecuting attorney for Putnam County.

Smith, now a new mother, said the experience left her with “a bad taste in her mouth” for police officers, and now, she’ll have to figure out how to teach her son to respect law enforcement while she’s afraid to go near them.

Amendments to Anti-money Laundering Act – consultation process initiated

Introduction

On 1 June 2018 the Federal Council initiated the consultation on a number of amendments to the Anti-money Laundering Act. The draft bill marks the third bundle of legislative measures to comprehensively implement the recommendations of the Financial Action Task Force in its latest mutual evaluation report on Switzerland.(1)

As a first step, on 4 September 2017 the Financial Market Supervisory Authority published a draft amendment to its anti-money laundering ordinance that introduced:

enhanced verification duties for establishing beneficial owners;
a requirement to regularly review and update know-your-customer (KYC) information also in respect of client relationships not involving particular risks;
new monitoring duties encompassing operations abroad; and
new criteria for classifying a relationship or transaction as 'high risk'.
The revised ordinance is scheduled to come into force in 2018.(2)

A second bundle of legislative measures that focused on increasing the transparency of legal entities and proposed abolishing bearer shares was published for consultation on 17 January 2018.(3)

Key amendments

The consultation draft(4) of 1 June 2018 proposes the following key amendments to the Anti-money Laundering Act:

extending the act's scope to include providers of services relating to establishing, managing or administering companies and trusts(5) – these service providers must comply with newly established due diligence duties;
explicitly requiring financial intermediaries to verify information on beneficial owners(6) and thereby codifiy current practice and existing case law – financial intermediaries must also regularly check that client data is up to date; and
reducing the threshold for cash payments in precious metals and gem trading – currently, traders must obey specific duties of care when receiving a cash payment of Sfr100,000; this threshold will be adjusted to Sfr15,000.(7)
The consultation draft also addresses the risk of non-profit organisations (eg, associations) being misused for financing terrorism or money laundering.(8) Associations which are mainly involved in collecting or distributing assets abroad for charitable purposes must now be entered in the commercial register. In addition, the Federal Council may extend the duty of registration to other associations which it considers particularly at risk of being misused.

Further, the consultation draft repeals the right to report suspicion of money laundering under Article 305ter(2) of the Penal Code. Over time, Swiss court practice has constantly lowered the threshold triggering the duty to report suspicious transactions and relationships under Article 9 of the Anti-money Laundering Act, which has made the distinction between reporting rights and reporting duties increasingly blurred and confusing.(9)

In the interest of a coherent suspicious activity reporting system, the government has suggested eliminating reporting rights. Henceforth, even where there is a vague initial suspicion of unlawful conduct, financial intermediaries will have a duty to report, unless inquiries and background checks pursuant to Article 6 of the Anti-money Laundering Act clearly show that the suspicion is unfounded.

Advisers' due diligence duties

The most far-reaching amendment to the Anti-money Laundering Act is the extension of its scope to include certain service providers (defined in the consultation draft as 'advisers'). These services comprise:

establishing, managing and administering foreign companies and legal arrangements (eg, trusts), as well as Swiss domiciliary companies;
procuring funds relating to such activities;
selling or purchasing such a company or trust;
allowing one's address to be registered as the seat of such a company or trust;
acting as nominee shareholder for a foreign company or helping another person to such a position; and
preparatory (and hence advisory and consultancy) services relating to any of these activities.
Advisers' due diligence duties are set out in a general manner in Article 8b of the consultation draft.(10) When establishing a business relationship, advisers must verify customers' identities and establish beneficial owners' identities.(11) Further, advisers must keep records pursuant to Article 7 of the Anti-money Laundering Act and clarify the economic background and purpose of their customers' requested services.

Advisers which are unable to comply with their due diligence duties must not enter into or terminate business relationships with customers.(12) Equally, advisers must terminate business relationships if they know or have reasonable grounds to suspect that a business is connected to:

a criminal organisation;
financing terrorism; or
money laundering.(13)
Failure to terminate the business relationship carries a fine of up to Sfr500,000.(14) The consultation draft does not foresee a specific duty for advisers to report suspicious transactions or relationships to the Money Laundering Reporting Office (in contrast to financial intermediaries and traders, which are subject to a respective duty pursuant to Article 9 of the Anti-money Laundering Act). However, the government's explanatory notes to the consultation draft underline that advisers should consider reporting criminal conduct to the Swiss penal prosecutions authorities pursuant to the Code of Penal Procedure.(15)

US: Ex Head of Swiss Bank Pleads Guilty to Money Laundering

The former managing director and vice chairman of Swiss Bank pleaded guilty on Wednesday for his role in the laundering of over one billion dollars that were embezzled from Venezuela’s state-owned oil company, the US Department of Justice said.

German national Matthias Krull, 44, a resident of Panama, admitted in a federal court in Miami that he helped launder US$ 1.2 billion embezzled from Petroleos de Venezuela, S.A.

The scheme began in 2014 when several suspects from Venezuela had obtained $600 million from PDVSA and enacted a sophisticated currency exchange scheme to embezzle it. A portion of that money was laundered through Miami real estate, allowing their profits to grow. By May 2015, the conspiracy had doubled to $1.2 billion.

Krull admitted that he attracted private clients, particularly clients from Venezuela, to the bank. His clients included Francisco Convit Guruceaga, who was indicted on money laundering charges on Aug. 16.

South Florida Bankers Learn To Spot Dirty Venezuelan Cash – Including Maduro's?

This week the U.S. froze assets in South Florida worth hundreds of millions of dollars. They belong to people charged with embezzling and laundering Venezuelan oil money. South Florida bankers are getting tuned in to this Venezuelan problem.

Last month the U.S. charged several Venezuelan officials and businessmen with laundering more than $1 billion in stolen public funds. Most of it was allegedly laundered through South Florida real estate and other assets.

That’s an increasing occurrence. Venezuelans with allegedly dirty cash to invest are looking for ways around U.S. financial sanctions against their country’s authoritarian regime. So South Florida bankers, lawyers and executives are learning how to spot those laundering schemes.

“Here in South Florida, financial institutions right now are coping with an incredible risk in dealing with Venezuela,” says Daniel Gutierrez, who chairs the Florida International Bankers Association’s anti-money laundering committee.

Thursday in Key Biscayne, the Association hosted a panel, including a Homeland Security agent, on what red flags to look for regarding Venezuela – and what U.S. officials expect financial institutions to do when they see them.

“The banks are struggling with shell corporations that are incorporated here but that are owned by this humongous spider web of offshore companies to hide the ownership with respect to corruption in Venezuela," says Gutierrez. "You have to report that as a suspicious activity.”

The Miami Herald has reported one of the unnamed Venezuelans indicted last month is none other than President Nicolás Maduro

A Dark Journey Into “The Minds of Men” — Film Review

From the opening of Truthstream Media’s first full-length documentary THE MINDS OF MEN, the general aesthetic — from the narration to the black-and-white appearance to the bizarre imagery — is properly reminiscent of an episode of The Twilight Zone.

Featuring original music and character voicing by Melissa and Aaron Dykes, viewers will learn about the people behind mind-control programs designed and implemented by the military, universities, foundations, elite societies, science and government institutions. THE MINDS OF MEN weaves archival video footage, news clippings, primary research papers, interviews, and analysis into a stunning trove of conclusions about what humanity faces.

As the nearly 4-hour film commences, Part I introduces a chronicle of various experiments on unwitting populations, and the mad science torture methods of breaking down the psyche in an attempt to rewrite the human brain much as one would a computer hard drive.

Viewers might feel like they are completely familiar with projects like the CIA’s MKULTRA, but this well-known program is only used to set the stage. Aaron and Melissa begin to delve deep into the lesser-known subprojects that were developed to create a broad array of tactics and technologies that were tested on many unwitting human beings.

In fact, as the filmmakers expertly document, no one has been off-limits when it comes to military research into the inner workings of the human mind. Psychological, pharmacological and technological trauma was routinely used in tests on military personnel, inmates, hospital patients and even children.

As stated in the film:

The implications for brainwashing, indoctrination, and re-education were staggering.

Part II – Cybernetics covers the establishment of “control and communication in the animal and machine.” Working from the baseline idea that people are fully programmable, the next step along the path toward ultimate control would be to automate the mission. This “man-machine project” introduced the concept of a “neural net,” which we see being developed in a much more advanced form now under the term “neural lace.”

Learning about the origins of robotics and artificial intelligence, all designed to mechanize the human mind, is a solid reminder to be wary of any of the supposed benefits that mind-rewiring technology claims in its modern propaganda.

The dark origins are laid completely bare in what Aaron Dykes calls a “global Manhattan Project for the mind,” which was heavily documented but long since forgotten in publications like Mental Health and World Citizenship. The film continues to connect the dots throughout the evolution of the Internet itself as it was constructed to become a de facto electronic nervous system that the populace is wired into. The potential for behavior modification was seen very early on, even as “new revelations” emerge from social media companies that only now acknowledge this to be part of the built-in design.

Part III – The Brain Doctors looks at many of the people behind mind control systems like the MKULTRA subprojects. Moving beyond behavioral modification, this begins the age of direct mind control via “psychosurgery” with horrific experiments conducted on mental patients. Many of the techniques were rudimentary and brutal precursors to technology we are seeing in the news today, such as transcranial magnetic stimulation. However, today’s news bites don’t properly contextualize the history that the filmmakers have uncovered in the fields of biological control through radio frequency transmitted to implanted electrodes, and testing with microwave radiation (5G anyone?). Worse still is the fact that this testing began on animals, but humans were eventually treated just the same in sanctioned laboratories.

Part IV – The Psychocivilized Society segues from the political turmoil of the 1960s which led to the theory that the behavior of rioting might have a medical cause, even leading some proponents to suggest that political leaders and activists must have some sort of brain disease that should be targeted for correction or prevention. It was an early type of pre-crime notion that sought to identify behavior patterns and the likelihood of violence before any activity had taken place.

What followed was the development of the brain-computer interface and, specifically, the pursuit that specific brainwaves could be eradicated. This is where the concept of violence prediction came about as the combination of psychiatry and social systems began to meld into one overall method for direct control over large populations.

A key interview with Dr Breggin, MD serves to round out all of what the film presents and is a must-see whistleblower account of someone who saw these systems being built. At the time, Dr Breggin was a lone voice of reason and ethics; and in the film, he appears as a shining light amid the darkness as he recounts horrendous physical and mental abuse that clearly was/is rife at the highest level of these mind control programs.

And this film, too, is a shining light despite its dark overtones. It is a meticulously and comprehensively researched account that is a great service to the public as well as other researchers in bringing into one place all of the dots that need to be connected.

After viewing this documentary, despite our own 15-year investigation into the subject of government mind control, we wholeheartedly agree with Melissa and Aaron’s statement about their personal journey while making this film: You may think you know this story, but we promise you, you don’t.

By Ken Adachi. 

I can't condone illegal 'immigration' in America. It's not "immigration"

when you enter the country illegally; it's criminal entry.

This is a sovereign nation and its government has the right and the duty to keep out or deport (or jail) those who enter illegally.

Every other nation on the face of the earth exercises that right without apologizing for protecting itself from illegal incursion. However,