Ten Former NFL Players Charged in Alleged Nationwide Fraud on Health Care Benefit Program for Retired NFL Players

Ten former National Football League (NFL) players have been charged in the Eastern District of Kentucky for their alleged roles in a nationwide fraud on a health care benefit program for retired NFL players. 

The alleged fraud targeted the Gene Upshaw NFL Player Health Reimbursement Account Plan (the Plan), which was established pursuant to the 2006 collective bargaining agreement and provided for tax-free reimbursement of out-of-pocket medical care expenses that were not covered by insurance and that were incurred by former players, their wives and their dependents – up to a maximum of $350,000 per player.  According to the charging documents, over $3.9 million in false and fraudulent claims were submitted to the Plan, and the Plan paid out over $3.4 million on those claims between June 2017 and December 2018.

“Ten former NFL players allegedly committed a brazen, multi-million dollar fraud on a health care plan meant to help their former teammates and other retired players pay legitimate, out-of-pocket medical expenses,” said Assistant Attorney General Benczkowski.  “Today’s indictments underscore that whoever you are, if you loot health care programs to line your own pockets, you will be held accountable by the Department of Justice.”

“The defendants are alleged to have developed and executed a fraudulent scheme to undermine a health care benefit plan established by the NFL – one established to help their former teammates and colleagues pay for legitimate medical expenses,” said U.S. Attorney Robert M. Duncan Jr., for the Eastern District of Kentucky. “The defendants allegedly submitted false claims to the plan and obtained money for expensive medical equipment that was never purchased or received, depriving that plan of valuable resources to help others meet their medical needs. We have prioritized the investigation and prosecution of health care fraud in our office, and we appreciate the partnership we share with the Criminal Division and the FBI in pursuing these important matters.”

“This investigation serves as an illustration of the rampant and deliberate scams against health care plans occurring daily throughout the country,” said FBI Special Agent in Charge George L. Piro of the Miami Field Office.  “In this case, these fraudsters pocketed money from the Gene Upshaw National Football League Health Reimbursement Account Plan that was intended for former NFL players who are ill or infirm.  Over 20 FBI field offices participated in this investigation which demonstrates the level of commitment we have to rooting out this type of fraud.”

Two separate indictments filed in the Eastern District of Kentucky outline two alleged conspiracies involving different players related to the same scheme to defraud the Plan. Those charged in the indictments are the following:

  • Robert McCune, 40, of Riverdale, Georgia, is charged with one count of conspiracy to commit wire fraud and health care fraud, nine counts of wire fraud and nine counts of health care fraud. 
     
  • John Eubanks, 36, of Cleveland, Mississippi; Tamarick Vanover, 45, of Tallahassee, Florida; and Carlos Rogers, 38, of Alpharetta, Georgia, are each charged with one count of conspiracy to commit wire fraud and health care fraud, two counts of wire fraud and two counts of health care fraud. 
     
  • Clinton Portis, 38, of McLean, Virginia; Ceandris Brown, 36, of Fresno, Texas; James Butler, 37, of Atlanta, Georgia; and Fredrick Bennett, 35, of Port Wentworth, Georgia, are each charged with one count of conspiracy to commit wire fraud and health care fraud, one count of wire fraud and one count of health care fraud.
     
  • Correll Buckhalter, 41, of Colleyville, Texas, and Etric Pruitt, 38, of Theodore, Alabama, are charged with one count of conspiracy to commit wire fraud and health care fraud. 

In addition, the government has filed notice that it intends to file criminal informations charging Joseph Horn, 47, of Columbia, South Carolina, and Donald “Reche” Caldwell, 40, of Tampa, Florida, with conspiracy to commit health care fraud in the Eastern District of Kentucky.

The indictments charge that the scheme to defraud involved the submission of false and fraudulent claims to the Plan for expensive medical equipment – typically between $40,000 and $50,000 for each claim – that was never purchased or received.  The expensive medical equipment described on the false and fraudulent claims included hyperbaric oxygen chambers, cryotherapy machines, ultrasound machines designed for use by a doctor’s office to conduct women’s health examinations and electromagnetic therapy devices designed for use on horses. 
 
According to allegations in the indictments, McCune, Eubanks, Vanover, Buckhalter, Rogers and others recruited other players into the scheme by offering to submit or cause the submission of these false and fraudulent claims in exchange for kickbacks and bribes that ranged from a few thousand dollars to $10,000 or more per claim submitted.  As part of the scheme, the defendants allegedly fabricated supporting documentation for the claims, including invoices, prescriptions and letters of medical necessity.  After the claims were submitted, McCune and Buckhalter allegedly called the telephone number provided by the Plan and impersonated certain other players in order to check on the status of the false and fraudulent claims.
 
This case was investigated by the FBI and is being prosecuted by the Health Care Fraud Unit of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Kentucky.  The investigation included efforts by various FBI Field Offices and Resident Agencies, including: Augusta, Georgia; Birmingham and Mobile, Alabama; Cleveland, Ohio; Chicago, Illinois; Columbia, South Carolina; Dallas and Houston, Texas; Denver, Colorado; Jackson, Mississippi; Lexington, Kentucky; New Orleans, Louisiana; Miami, Jacksonville and Tampa, Florida; Newark, New Jersey; Los Angeles, San Diego, Sacramento and Newport Beach, California; Phoenix, Arizona; Salt Lake City, Utah; and Washington, D.C. 
 
Trial Attorneys John (Fritz) Scanlon, Alexander J. Kramer and Thomas J. Tynan of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Paul C. McCaffrey and Andrew E. Smith of the Eastern District of Kentucky are prosecuting the cases. 

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Author: December 12, 2019

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Assistant Attorney General Brian Benczkowski Delivers Remarks at the Former NFL Player Health Care Benefit Program Fraud Press Conference

Remarks as Prepared for Delivery

Good morning, and thank you for being here.

Today, we are announcing charges against 10 former National Football League players who are accused of defrauding an NFL health care program meant to benefit retired players and their families. 

These former players have been charged in two separate indictments with conspiracy, wire fraud, and health care fraud, for submitting fraudulent claims to the healthcare plan for expensive medical equipment that was never purchased and never received. 

The cases have been indicted in Lexington, in the Eastern District of Kentucky. 

The charges we are announcing today are merely allegations, and each of the defendants is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

The Gene Upshaw NFL Player Health Reimbursement Account Plan (“the Plan”) provides for tax-free reimbursement of out-of-pocket medical care expenses incurred by eligible former players, their spouses, and their dependents.  

Once eligible players retire, they are not taxed on reimbursements from the Plan, so long as those reimbursements are for actual medical care expenses they have incurred.

As outlined in the indictments, a group of former players brazenly defrauded the Plan by seeking reimbursement for expensive medical equipment that they never purchased. 

Things like hyperbaric oxygen chambers, ultrasound machines used by doctor’s offices to conduct women’s health exams, and even electromagnetic therapy devices designed for use on horses. 

As a result of the fraud, more than $3.9 million in phony claims were submitted to the Plan, and the Plan paid out approximately $3.4 million on those claims between mid-2017 and mid-2018.

The two indictments involve different players, but the crimes charged were carried out in almost identical fashion. 

The ringleaders of the fraud recruited other eligible former players by offering to submit or assist in submitting fake claims to the Plan. 

In exchange, the ringleaders demanded kickbacks ranging from a few thousand dollars to $10,000 or more for each fraudulent claim. 

If a participant agreed to this scheme, the leaders and recruiters obtained personal information from them, so that the information could be used to complete and submit a false claim on their behalf.

In each case, the forms submitted in support of the claim were completely fabricated.  This included things like fake invoices from medical supply companies, and forged letters and prescriptions from medical care providers.

The exact size of each claim varied, but they were typically in the range of $40,000 to $50,000 each.

When a defendant received his reimbursement check, he then kicked back the agreed-upon amount to the ringleader or recruiter. 

This process was repeated over and over again, placing the integrity of the Plan at risk.    

By defrauding the Plan and treating it like their own personal ATM machine, sadly, the defendants placed the Plan’s tax exempt status at risk and threatened the ability of law-abiding former players to continue to receive tax-free reimbursements for legitimate medical expenses for themselves or their families.

The fraud only stopped when CIGNA detected it, began refusing to pay claims, and then referred the matter to the Fraud Section of the Department of Justice’s Criminal Division for investigation. 

I want to thank our partners who have worked hard on this case:

  • The U.S. Attorney’s Office for the Eastern District of Kentucky, including U.S. Attorney Robert Duncan; and
     
  • The FBI, specifically George Piro, the Special Agent in Charge of FBI’s Miami Field Office, as well as the supervisors and agents on the health care fraud squad who investigated this case, and multiple FBI field offices around the country who assisted with the investigation. 

And I want to note that the investigation is still ongoing.

It is now my pleasure to introduce my colleague, Robert Duncan, the U.S. Attorney for the Eastern District of Kentucky.

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Author: December 12, 2019

Justice Department Files Antitrust Case and Simultaneous Settlement Requiring Elimination of Anticompetitive College Recruiting Restraints

The Department of Justice’s Antitrust Division today filed a civil lawsuit against the National Association for College Admission Counseling (NACAC) alleging that NACAC established and enforced illegal restraints on the ways that colleges compete in the recruiting of students. The Antitrust Division simultaneously filed a proposed consent decree with NACAC.  Under the decree, NACAC is required to remove three anticompetitive rules from its Code of Ethics and Professional Practices (CEPP), which broadly regulates how its college members conduct their admissions process.  In advance of today’s court filings, and in response to the Antitrust Division’s investigation, NACAC members voted to remove the rules at their Annual Meeting in September.

“While trade associations and standards-setting organizations can and often do promote rules and standards that benefit the market as a whole, they cannot do so at the cost of competition,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division.  “Today’s settlement is a victory for all college applicants and students across the United States who will benefit from vigorous competition among colleges for their enrollment.”

Under its proposed consent decree with the Justice Department, NACAC has agreed to remove rules regarding recruitment of (1) transfer students from other schools; (2) prospective incoming freshmen after May 1; and (3) prospective Early Decision applicants.  NACAC is further restrained from establishing or enforcing any similar rule in the future, and has agreed to increase its antitrust compliance training with employees and members.  If approved by the court, the consent decree will resolve the Antitrust Division’s competitive concerns.

NACAC is headquartered in Arlington, Virginia.  NACAC is the leading trade association related to the college admissions process.  Its members include primarily non-profit colleges and universities and their admissions staff, as well as high schools and their counselors.

As required by the Tunney Act, the proposed consent decree, along with the Department’s competitive impact statement, will be published in the Federal Register.  Any person may submit written comments concerning the proposed settlement within 60 days of its publication to Aaron Hoag, Chief, Technology and Financial Services Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 7100, Washington, D.C. 20530.  At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.

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Author: December 12, 2019

Joint U.S-EU Statement Following the U.S.-EU Justice and Home Affairs Ministerial Meeting

On December 11, the U.S.-EU Ministerial Meeting on Justice and Home Affairs took place in Washington D.C.  The United States of America was represented by Attorney General William P. Barr and Acting Secretary for Homeland Security Chad Wolf.  The Ministerial – which is held twice a year — aims to oversee transatlantic cooperation in the area of Justice and Home affairs and address common security threats.

The European Union was represented by the Commissioner for Justice Didier Reynders, as well as by Finnish Minister of Justice Anna-Maja Henriksson, Finnish Permanent Secretary of the Ministry of the Interior Ilkka Salmi, Croatian Minister of the Interior Davor Božinović, and Croatian Minister of Justice Dražen Bošnjaković, on behalf of the current and incoming Presidencies of the Council of the European Union. The meeting was also attended by Assistant Attorney General John C. Demers, the EU Counter-Terrorism Coordinator Gilles de Kerchove, the Deputy Secretary General of the EEAS Christian Leffler, the Deputy Executive Director of Europol Jürgen Ebner, and the Vice President of Eurojust Klaus Meyer-Cabri.

As the EU begins a new political cycle, the United States and the EU reaffirmed their strong commitment to foster the Transatlantic Partnership and pursue their dialogue on Justice and Home Affairs, building on the existing operational cooperation and best-practice exchanges on matters of common interest.

Fighting terrorism in all its forms remains our top common priority. We concurred on the importance of continuing and expanding our efforts to identify and hold accountable all those who support or engage in terrorist activity, with a particular emphasis on the sharing of information gathered in zones of combat for use in criminal proceedings as admissible evidence. The importance of using this type of information to improve the security of our borders was also highlighted, especially in the context of returning foreign terrorist fighters. We welcomed achievements in this domain, in particular the U.S. efforts to share information on foreign terrorist fighters with EU Member States and Europol. We called for continued engagement and ongoing operational cooperation between relevant agencies, building on the conclusions of the meeting on these subjects held in Brussels on July 10.  We further discussed various forms of violent extremism, including ethnically- and racially-motivated violent extremism, and we supported further expert exchanges to examine the international linkages among these groups.

The U.S.-EU agreement on Passenger Name Records (PNR) remains an important instrument for enhancing the security of our citizens. In that context, we look forward to the final report following the joint evaluation. We reaffirmed our shared interest in establishing ICAO standards to encourage rapid and effective implementation of UNSCR 2396 for the use of PNR to combat terrorist travel, with full respect for human rights and fundamental freedoms.

Together we acknowledge that threats to security take on increasingly different forms, challenging our collective resilience. We discussed means to enhance cooperation on countering hybrid threats — including chemical, biological, radiological, and nuclear weapons, as well as explosives – and welcomed the U.S.-EU experts seminar on that issue held in Brussels in September 2019.  We also recognized the challenges to security presented by drones.  We further discussed challenges to cybersecurity and updated each other on our respective efforts to assess and address 5G security challenges, including those impacting the security of our supply chain.  In particular, we discussed the need to work with industry to establish trusted markets for 5G and other telecommunications equipment and services. We will continue to keep each other informed of developments in this area and commit to approaching emerging technologies through a risk-informed perspective.

The United States and the European Union reaffirmed the importance of enhancing judicial cooperation in cyberspace, in particular with regard to cross-border access to electronic evidence. In this context, we welcome the negotiations for an U.S.-EU agreement facilitating access to e-evidence for the purpose of judicial cooperation in criminal matters.  We agreed to review progress in the negotiations at the next Ministerial Meeting in 2020. Furthermore, we exchanged views on the ongoing negotiations for the Second Additional Protocol of the Budapest Convention and discussed the importance of making swift progress, in view of our joint and strong commitment to the Budapest Convention, which remains the instrument of choice for international cooperation on cybercrimes for both the EU and the United States.

We also acknowledged that the use of warrant-proof encryption by terrorists and other criminals – including those who engage in online child sexual exploitation – compromises the ability of law enforcement agencies to protect victims and the public at large. At the same time, encryption is an important technical measure to ensure cybersecurity and the exercise of fundamental rights, including privacy, which requires that any access to encrypted data be via legal procedures that protect privacy and security. Within this framework, we discussed the critical importance of working towards ensuring lawful access for law enforcement and other law enforcement authorities to digital evidence, including when encrypted or hosted on servers located in another jurisdiction.

We reiterated a common commitment to enhance the resilience of our electoral systems and to combat any form of interference in electoral processes. In this context we welcomed the outcome of the November 26 first experts’ meeting on resilience of electoral systems. The event brought together specialists from both sides of the Atlantic to discuss respective approaches and share best practices; we look forward to continuing dialogues on this issue.

Finally, we welcomed Poland’s designation for the U.S. Visa Waiver Program, which underscores the usefulness of the tripartite process and the encouraging progress made by four other Member States towards reciprocal visa free travel under our respective legal frameworks.  We are committed to continue working together, in the appropriate frameworks, to support the remaining four EU Member States in their efforts towards designation in the Visa Waiver Program.

Reaffirming our joint commitment to advance together towards common solutions in all these areas, we agreed to meet again in the first half of 2020 in Croatia.

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Author: December 11, 2019

Dallas Man Sentenced to 30 Years on Terrorism Charges

A 42-year-old Dallas, Texas, man has been sentenced to 30 years in federal prison following a conviction for multiple terrorism charges.

Following a three-and-a-half day trial, Said Azzam Mohamad Rahim, a 42-year-old United States citizen, was convicted in May of one count of conspiracy to provide material support to a designated foreign terrorist organization (FTO), one count of attempting to provide material support to an FTO, and six counts of making false statements involving international terrorism to federal authorities.

“Rahim spread the violent message of ISIS online,” said Assistant Attorney General for National Security John C. Demers.  “He also attempted to travel to support ISIS and then lied to FBI when questioned about his activities.  This sentence is the consequence of his criminal activities and a clear message to others who would consider following in his footsteps: don’t.” 

 “Mr. Rahim embraced a warped ideology on social media, promoting violence against innocent people, including Americans,” said U.S. Attorney Erin Nealy Cox for the Northern District of Texas.  “The Justice Department is committed to combatting terror at home and abroad.”

According to evidence presented at trial, Rahim moderated a social media channel dedicated to recruiting fighters for the Islamic State of Iraq and al-Sham, or ISIS, a State Department designated terror group.  

Rahim used Zello, a push-to-talk direct messaging application, to promote violence in ISIS’s name, prosecutors said.

Records showed he spent years on Zello’s “State of the Islamic Caliphate” channel, where he touted acts of terror under various monikers: 

“Kill and do not consult anyone,” he said in July 2016.  “Kill by any means, smash his head on the wall, spit in his face, burn — I mean anything, anything – poison, anything.” 

“Brothers!  What are you waiting for?” he said a month later.  “Mobilize and perform jihad for the cause of Allah…. Some of the brothers mobilized from this channel, they were amongst us.”

He even praised several terrorist attacks after the fact.

“I was happy for this act,” Rahim said after a truck barreled into a crowd of people in Nice, France, killing 86. “Those dogs.”

Rahim was arrested on March 5, 2017, at the Dallas Fort Worth International Airport, where he was attempting to board a flight to Amman, Jordan.  Asked by agents if he had ever supported ISIS, advocated travel for the purposes of jihad, promoted violence on ISIS’s behalf, or encouraged anyone to kill infidels at the urging of ISIS spokesman Abu Mohammed al-Adnan, Rahim said “no.”

The FBI, the U.S. Department of State – Diplomatic Security Services, and the Joint Terrorism Task Force conducted the investigation.  Assistant U.S. Attorney Errin Martin and Trial Attorney Taryn Meeks of the National Security Division’s Counterterrorism Section prosecuted the case.  U.S. District Judge Jane Boyle presided over the trial.

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Author: December 11, 2019

United States and Croatia Sign Bilateral Agreements Enhancing Law Enforcement Cooperation

On Tuesday, United States Attorney General William P. Barr and Croatia’s Minister of Justice Dražen Bošnjaković signed an extradition and mutual legal assistance agreement on behalf of their nations at the U.S. Department of Justice in Washington, DC.

Attorney General Barr signed the bilateral U.S.-Croatia extradition and mutual legal assistance instruments, which were negotiated this year by the Department of State’s Office of the Legal Adviser and the Criminal Division’s Office of International Affairs.

“I commend the negotiators from our countries for their work on U.S.-Croatia law enforcement cooperation agreements, and for expeditiously preparing these texts for signature before Croatia begins its EU presidency next month,” said Attorney General Barr. “The instruments will further strengthen our bilateral law-enforcement relationship, improving the ability to extradite fugitives and exchange evidence needed for prosecutions.”

“This is a great achievement which will further strengthen relations between our two countries,” said Minister of Justice Bošnjaković. “These two new agreements respond to the challenges of fighting cross-border crime in a more efficient manner.”

Present at the signing were officials from the U.S. Department of State and the Ministry of Justice of the Republic of Croatia.

The new agreements enhance bilateral relations by affording both nations with better information-sharing and cooperative capabilities. The new extradition agreement modernizes the extradition relationship between the countries, which had been governed by a 1901 treaty.  The instrument provides a dual-criminality basis for extradition, and it streamlines the procedures to be followed in pursuing extradition.  The mutual legal assistance instrument, the first such bilateral instrument between the countries, will better enable prosecutors to exchange information facilitating the prevention, investigation, and prosecution of crime.  It will improve cooperation in the fight against terrorism, organized crime, corruption, cybercrime, and other serious transnational criminal offenses.

The instruments stem from the legal framework of the U.S.-European Union Agreements on Extradition and Mutual Legal Assistance signed on June 25, 2003, prior to Croatia entering the EU.

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Author: December 10, 2019

EPA and Justice Department Announce $245 Million Agreement for Cleanup at the Allied Paper Inc./Portage Creek/Kalamazoo River Superfund Site

The U.S. Environmental Protection Agency (EPA), U.S. Department of Justice, the Kalamazoo River Natural Resource Trustee Council, and Michigan Department of Environment, Great Lakes, and Energy (EGLE) today announced a proposed consent decree that would require NCR Corp. to clean up and fund future response actions at a significant portion of the Allied Paper Inc./Portage Creek/Kalamazoo River Superfund site.  The consent decree also includes payments related to natural resource damages and past cleanup efforts at the site.  The consent decree is subject to a 30-day public comment period.

“This agreement marks a milestone in efforts to clean up Superfund sites in the Great Lakes region, and especially to address the legacy of paper mill generated PCB contamination in the Kalamazoo River watershed,” said Assistant Attorney General Jeffrey Bossert Clark of the Justice Department’s Environment and Natural Resources Division.  “Under this settlement, cleanup and restoration efforts will be accelerated and that’s really good news for communities in the region and the environment.”

“This is a terrific settlement,” said EPA Assistant Administrator for Enforcement and Compliance Assurance Susan Bodine.  “It not only ensures that responsible parties will continue to clean up contamination at the Kalamazoo River Superfund site, but also ensures that both past and future costs incurred by the EPA and the state will be recovered.”

“Today’s agreement is a big step towards cleaning up the Kalamazoo River,” said EPA Regional Administrator Cathy Stepp.  “This Administration is committed to cleaning up and restoring contaminated sites so they can be put back to productive use in the community.”

“This settlement is an important step for the State and the federal government in cleaning up contamination in and near the Kalamazoo River,” said Michigan Attorney General Dana Nessel. “I look forward to continued cooperation with our federal partners on this site to benefit our communities – including the cities of Plainwell and Otsego, and the townships of Gun Plain, Otsego, and Trowbridge – and to protect public health, safety, and welfare.”

“This settlement represents substantial progress in the cleanup and restoration of the Kalamazoo River,” said Liesl Clark, Director of EGLE.  “The agreement requires NCR Corporation to take specific cleanup actions to address PCB contamination in and near the Kalamazoo River that will protect the public health and the environment.  It also provides funds for the selection of natural resource projects to restore natural resources and help compensate the public for lost recreational opportunities within this important Southwest Michigan watershed.”

This Superfund site has been listed on the EPA Administrator’s Emphasis List of Superfund sites targeted for immediate, intense action.  Each site on the list has a short-term milestone to provide the basis for tracking the site’s progress.

The Allied Paper Inc./Portage Creek/Kalamazoo River Superfund site is in Allegan and Kalamazoo counties and is divided into six segments, or operable units (OUs), that require cleanup. According to the settlement terms, NCR Corporation has agreed to spend approximately $135.7 million cleaning up three areas of OU 5.  OU 5 includes 80 miles of the Kalamazoo River and three miles of Portage Creek.  In addition, NCR will pay:

  • $76.5 million to EPA for past and future costs in support of river cleanup activities;
     
  • $27 million to natural resource trustees of the Kalamazoo River Natural Resource Trustee Council for natural resources damage assessment and claims; and
     
  • $6 million to State of Michigan for past and future costs.
     
    Historically, the Kalamazoo River was used as a power source for paper mills that were built along the river and a disposal site for the paper mills and the communities adjacent to the river.  NCR arranged for disposal of carbonless copy paper contaminated with chemicals called polychlorinated biphenyls (PCBs) at the site.  In the early 1970’s, PCBs were identified as a problem in the Kalamazoo River.  In 1990, in response to the nature and extent of PCB contamination, the site was added to the National Priorities List, which includes the nation’s most serious uncontrolled or abandoned hazardous waste releases.  EPA, working along with EGLE, has cleaned up three of the six operable units, removed nearly 450,000 cubic yards of contaminated material from the site, cleaned up and restored seven miles of the Kalamazoo River and banks, and capped 82 acres worth of contaminated material.

To learn more about this site, visit http://www.epa.gov/superfund/allied-paper-kalamazoo.

Background

EPA established the Administrator’s Emphasis List in December 2017 in response to recommendations from EPA’s Superfund Task Force.  The list is comprised of sites identified by Administrator Wheeler and the EPA regional offices that will benefit from the administrator’s immediate attention or action.

The list serves as a mechanism to address delays in the cleanup of significant Superfund sites by specifying milestones that will facilitate and accelerate a site’s cleanup progress.  EPA will consider removing a site from the list once the milestone is achieved and the cleanup activities at that site are back on track.  The list is updated quarterly with sites moving on and off the list as needed.  Removal from the Administrator’s Emphasis List does not change the site’s status on the NPL.

EPA remains committed to addressing risks at all Superfund sites, not just those on the Administrator’s Emphasis List. EPA continues to accelerate progress at all Superfund sites across the country.

The updated Administrator’s Emphasis List is available on the agency’s website at https://www.epa.gov/superfund/administrators-emphasis-list.

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Author: December 11, 2019

New York Man Pleads Guilty to Providing Material Support to Terrorists

Nihad Rosic, 31, of Utica, New York, pleaded guilty today to one count of conspiring to provide material support to terrorists and one count of providing material support to terrorists. Rosic appeared today before Judge Catherine D. Perry who accepted his plea and set his sentencing for April 16, 2020. 

Also charged in the indictment are: Ramiz Zijad Hodzic, his wife Sedina Unkic Hodzic, and Armin Harcevic, all of St. Louis County, Missouri, and Mediha Medy Salkicevic, of Schiller Park, Illinois.  All defendants were charged and convicted of conspiring to provide material support and resources to terrorists.

According to court documents, Rosic, agreed with co-defendant Ramiz Hodzic and others that they would provide material support, that being money and materials identified in the indictment, to Abdullah Ramo Pazara and others who engaged in combat against various entities and personnel in Syria and elsewhere.  Such combat necessarily involved the unlawful, willful, deliberate, and premeditated killing of persons abroad.  In May 2014, Rosic communicated directly with Pazara concerning Rosic’s plans to travel to Syria, meet Pazara, and join him in combat against various persons and entities in Syria. 

Rosic faces up to 15 years imprisonment and/or fines of up to $250,000, per count.  In determining the actual sentence, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

Assistant Attorney General Demers and U.S Attorney Jensen commended the St. Louis FBI and all of the Joint Terrorism Task Force Joint partners for their commitment and tenacity in a lengthy and complex investigation as well as their dedication to this successful prosecution.

This case was investigated by the St. Louis FBI’s Joint Terrorism Task Force, U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), U.S. Postal Inspection Service, St. Louis Metropolitan and St. Louis County Police Departments.  The case is being prosecuted by Assistant U.S. Attorneys Matthew Drake, Howard Marcus and Kenneth Tihen of the Eastern District of Missouri and Assistant U.S. Attorney Stephen Green of the U.S. Attorney’s Office in the Northern District of New York.

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Author: December 10, 2019

Former Civilian Employee of the U.S. Air Force Pleads Guilty to Making False Statements

A former civilian employee of the United States Air Force (USAF) pleaded guilty today for making false statements in connection with a federal investigation into the employee’s theft of government funds.

Gregory Burris, 48, of Miesau, Germany, pleaded guilty to one count of making false statements before U.S. Magistrate Judge Karen B. Molzen of the District of New Mexico.  A sentencing date has not been set.

According to documents filed with the court and admissions made in connection with Burris’s plea, between approximately 2013 and 2016, Burris was employed by the USAF as a Resource Advisor and was assigned to a multinational electronic warfare training facility (Polygone) near Ramstein Air Base in Germany.  In this position, Burris was responsible for, among other duties, generating and transmitting invoices and payment instructions to foreign militaries for their use of Polygone’s facilities.

Between early 2015 and early 2016, Burris generated and transmitted six invoices to foreign militaries for money owed to the U.S. government for expenses related to Polygone-sponsored training exercises.  Burris directed these militaries to transmit payment of the invoices to Burris’s personal checking account at a German bank, held jointly with his wife, rather than the authorized Department of Defense (DOD) bank account.  As a result of Burris’s instructions, foreign militaries unwittingly deposited approximately $144,953.41 into Burris’s personal bank account.

Federal investigators in Albuquerque, New Mexico, interviewed Burris on Aug. 29, 2018.  During the interview, he falsely stated that after receiving the deposits from the foreign militaries in his personal bank account, he wire-transferred the funds from his personal bank account to the authorized DOD bank account by requesting and authorizing each transfer in person at his local bank branch in Germany.  In fact, Burris used the entirety of these funds to pay for personal expenses.

The Air Force Office of Special Investigations and the Department of Defense Office of the Inspector General investigated this case.  Trial Attorney Erica O’Brien Waymack of the Criminal Division’s Public Integrity Section is prosecuting the case.

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Author: December 10, 2019

Attorney General William P. Barr Delivers Remarks at the National Association of Attorneys General 2019 Capital Forum

Remarks as Prepared for Delivery

Good afternoon.  Thank you General Landry for that kind introduction, and thank you to the National Association of Attorneys General (NAAG) for inviting me to join you today.  It is an honor and privilege to be here with my fellow attorneys general.

Through the Executive Working Group and in various operations, we are working together on several important law enforcement priorities.  Elder Justice is a personal priority for me, and I know the State AGs have been leading the charge for many years.  Derrick Schmidt’s Presidential initiative highlighted the impact of this important issue.  Each year, over three billion dollars are stolen or defrauded from millions of America’s elderly through a variety of malicious scams.  The State AGs are on the front line in this fight to protect the elderly from being exploited, and I pledge the Department’s full support in that effort.     

Similarly, human trafficking is an extremely important law enforcement issue for both the DOJ and the States AGs.  Attorneys General Paxton, Healey, Bacerra, Reyes and many others have been leaders in this vital effort.  We worked together to take down backpage.com, and we continue to engage our state partners though our Human Trafficking Prosecutorial Unit.  We look forward to continuing that work with you to make more progress in the year ahead.  

In addition to these important priorities, another topic that involves almost every AG in this room and one that also benefits from close federal-state cooperation is the review into market-leading online platforms. 

I. Benefits of Broad State AG Support on Review of Market-Leading Online Platforms

In DC, it’s hard to find many things that everyone agrees on.  One thing that has found wide and bi-partisan support, however, is the government taking a closer look at the leading online platforms and the competitiveness of digital markets.

Online platforms play an important role in our economy and in Americans’ daily lives, often serving as gateways for how we access goods, services, information and even each other. 

A few digital platforms in particular have enjoyed significant growth over the past decade.  Consumers now depend on these platforms every day.  Their size and pervasiveness have led to public concerns about the competitive health of these digital markets. 

We’ve heard widespread concerns from consumers, businesses and entrepreneurs, including about stagnated innovation, high prices, lack of choice, privacy, transparency, and public safety.  In response, DOJ initiated a review into market-leading online platforms, which we announced publicly last July. 

Concerns about online platforms have come from a wide variety of stakeholders, across the political spectrum.  Indeed, almost every State AG is now participating in publicly announced antitrust investigations of Google and Facebook.  I’ve had the benefit of meeting with representatives of these groups at the Department, and believe we have a good cooperative relationship in these efforts.

This is not the first time that the Department of Justice has cooperated with a bi-partisan coalition of State AGs on an antitrust matter involving a digital platform.

When the Department of Justice litigated a case against Microsoft roughly 20 years ago for antitrust violations, it was joined by a coalition of 20 state attorneys general and the District of Columbia.  There are still those in the Department and State AG community, including my friend Tom Miller, who were closely involved and remember it well.

Today, the State AG coalitions investigating Google and Facebook are even bigger than in Microsoft, including almost every state and federal territory.  I think this demonstrates the importance of these issues to Americans across the country, regardless of location or political persuasion.

II. Benefits of a Broad, Holistic Perspective

The benefits of a broad approach to online platforms go beyond building a federal-state partnership.  A broader, holistic perspective is also important as we consider substantive issues raised by the digital economy, both within and outside of the arena of antitrust.

Let me start with antitrust.  Antitrust is a core focus of the Department’s review into market-leading platforms because, ultimately, fair competition can cure many of the ills we see.  In a functioning free market, consumers can demand alternatives that better address their preferences, including for greater privacy, more transparency, or increased safety.  For consumer choice and the free market to work, however, firms have to be playing by the established rules of competition. That’s where antitrust enforcement steps in.

Many online platforms are not only big, but also offer a wide breadth of products and services.  Antitrust enforcers therefore must take an equally broad view of these platforms’ offerings, and the relationships between different markets, products, and business practices.

Let me touch on a few examples of where a broader perspective is useful in an antitrust analysis.

First, a broader perspective requires understanding the characteristics of the market.  This includes looking at whether there are high barriers to entry that prevent or deter new competitors.  For example, digital platform markets are often characterized by economies of scale and scope, including direct and indirect network effects. 

Take, for example, direct network effects in social media.  The more users on the same social media platform, the more valuable that platform is overall.  There are benefits to consumers from being on the same network as their friends and family.  At the same time, the existence of such network effects can make it harder for a new platform to attract users.  

This positive feedback loop is also inherent in platforms that rely on data and machine-learning.  For example, generally speaking, the more data a search engine has, the better its algorithms for search results can be.  The better the algorithm, the more users it can attract, and with them comes even more data.  And the cycle starts anew. 

Digital platforms can also have indirect network effects, meaning the more users on one side of the platform increases the value to users on the other side of the platform. 

In Microsoft, for example, there were indirect network effects that created what the court described as an “applications barrier to entry.”  The more consumers that used the Microsoft operating system, the more attractive the platform was to application developers.  Conversely, the more applications that were on the Microsoft operating system, the more attractive the platform was for users.  These indirect network effects created a barrier to entry that helped protect Microsoft’s monopoly. 

Network effects are not inherently problematic.  However, where strong network effects create a significant barrier to entry, it can lead to increased market power, which in turn can be used in anticompetitive ways.  

Given these dynamics, antitrust enforcers must be particularly vigilant to police for agreements and conduct that harm the competitive process.

Similarly, market power is not itself wrongful.  As I’ve said before, big is not necessarily bad.  Healthy competition creates winners and losers, and the prospect of winning (and the profits that come with it) can drive innovation in the first place.  Success that comes from creating a better, more innovative product should be applauded.  The danger, however, is that a monopolist (even one who earned that status lawfully) can be tempted to use their power to engage in anticompetitive conduct to preserve their dominant position. 

Moreover, the existence of market power can change the competitive effects of a business practice.  Conduct that may be procompetitive for a new entrant can become anticompetitive if undertaken by the incumbent 800 pound gorilla.  

For example, exclusivity agreements by a new entrant can increase competition by enabling a competitor to attract users with unique offerings, even in markets with strong network effects.  At the same time, exclusive dealing by a monopolist could have the opposite effect by depriving rivals of the inputs or scale necessary to compete. 

Bundling, tying, predatory pricing, and certain refusals to deal are other examples of conduct that can become problematic when undertaken by a firm with market or monopoly power. 

As digital firms transition from being the disruptive new entrant into an established market leader, they should pay attention to the impact of their business practices.  So too should the antitrust enforcers.

Second, in addition to understanding the dynamics within a market, like barriers to entry and market power, we also need to look at relationships between markets.  This is especially important because today’s digital platforms frequently operate across multiple areas.  

A dominant firm may seek to leverage its monopoly power in one market to gain an unfair advantage in another.  In the Microsoft case, for example, a key concern was that Microsoft was abusing its dominant position in operating systems to foreclose competition in browsers. 

The relationships between markets can be even more complex in the digital age, with the emergence of new business models and an increasingly important role of data.  Law enforcers need to better understand how consumer data is collected, used, and shared within a firm and with third parties.  Such antitrust inquiries generally require a broader perspective and deeper understanding of how each of these markets function.

Third, taking a broader perspective is particularly important in the context of “free” online services.  Digital platforms are not charities.  When they offer services to consumers for “free,” that just means they are making money somewhere else, either through a different product, from different consumers, or at a different point in time. 

The increasing prevalence and complexity of “free” digital services may require a broader perspective.

For example, antitrust enforcers may need to look beyond the free service to better understand a firm’s monetization strategy and incentives.  Enforcers also may need to look more closely at non-price effects.  Fortunately, the long-standing consumer welfare standard enables us to analyze non-price effects on competition, including on quality, innovation, and consumer choice. 

A broader perspective also requires looking beyond antitrust.  As we listen to complaints from the public, industry, and experts, it has become clear that not every problem related to online platforms comes within the reach of antitrust law. 

Some have therefore proposed expanding the antitrust laws to reach other non-economic harms.  Drastically re-inventing the antitrust laws, however, is neither easy nor advisable.  The Sherman Act has been around for over a century and has proved flexible enough to adapt to a wide variety of industries, including digital platforms.  We are open to considering new tools and targeted modifications, but a wholesale departure from the antitrust laws’ focus on competition is unwarranted.

While we should not distort the antitrust laws, the Department of Justice also cannot ignore real harms to the American people.  Where there are non-competition harms, the Department will consider whether there are other tools – including other legal or policy frameworks – that can help.  We are thinking critically about how the Department, and our state and federal partners, can address other topics related to online platforms, such as privacy, transparency, consumer fraud, child exploitation, or public safety.

One example of a non-antitrust issue related to online platforms is Section 230 of the Communications Decency Act.  Generally speaking, Section 230 provides immunity to interactive computer services for third-party content on their platforms. 

As this group well knows, there is currently a robust public debate over Section 230.  The NAAG sent a letter to Congress last May, proposing an amendment that would carve out U.S. state and territorial criminal law from the current scope of Section 230 immunity.  We, too, are studying Section 230 and its scope. 

The CDA was passed in 1996 in response to concerns about protecting children from sexually explicit content on the internet.  Section 230 was enacted primarily for two purposes.

The primary purpose of the amendment was to encourage platforms to self-regulate by granting immunity for blocking or filtering offensive material.  In particular, the amendment aimed to overrule a 1995 state court decision that treated an online message board as a publisher of third-party content, and thus liable for defamation, because the service restricted access to some, but not other, objectionable material.

Another purpose was to encourage the growth of online forums by immunizing platforms against liability for third party speech.  Section 230 was passed at a time where the internet was relatively new, and Congress wanted to protect the growth of online services and the ability for the internet to offer “a forum for true diversity of political discourse.” 

Section 230 has been interpreted quite broadly by the courts.  Today, many are concerned that Section 230 immunity has been extended far beyond what Congress originally intended.  Ironically, Section 230 has enabled platforms to absolve themselves completely of responsibility for policing their platforms, while blocking or removing third-party speech – including political speech – selectively, and with impunity. 

Some also question whether such a broad immunity is still necessary to protect online companies.  Indeed, ten years ago, a Ninth Circuit opinion denying Section 230 immunity in part remarked: “The Internet is no longer a fragile new means of communication that could easily be smothered in the cradle by overzealous enforcement of laws and regulations applicable to brick-and-mortar businesses.”  Fair Housing Council of San Fernando Valley v. Roommates.com LLC, 521 F.3d 1157, 1164 n. 15 (9th Cir. 2008).  In other words, the opinion stated:  “the Internet has outgrown its swaddling clothes and no longer needs to be so gently coddled.”  Id. at 1175, n. 39.

The staggering breadth of Section 230 immunity, as construed by the courts, is evident in a recent Second Circuit opinion involving the Anti-Terrorism Act.  See Force v. Facebook, Inc., 934 F.3d 53 (2nd Cir. 2019).  There, the court held that Facebook was immune under Section 230 for allegedly matching and facilitating communications between members of the terrorist group Hamas.  The court denied plaintiff’s argument that Facebook’s algorithms and friend-matching service rendered it a “non-publisher” outside the scope of Section 230.  Id. at 66.

Chief Judge Katzmann dissented in part, criticizing the virtually limitless scope of Section 230 immunity imposed by some courts.  He argued that providing immunity for the steps Facebook took to connect alleged terrorists through algorithm and friend suggestions was far removed from the original purpose of the CDA to protect children against obscene material online.  He called for Congress to revisit the CDA to “better calibrate the circumstances where such immunization is appropriate and inappropriate in light of congressional purposes.”  Id. at 77.

Chief Judge Katzmann is not alone in his calls for reform.  Section 230 has garnered significant attention from experts, consumer groups, and legislators.  Within DOJ, we also have started thinking critically this issue. 

The purpose of Section 230 was to protect the “good Samaritan” interactive computer service that takes affirmative steps to police its own platform for unlawful or harmful content.  Granting broad immunity to platforms that take no efforts to mitigate unlawful behavior or, worse, that purposefully blind themselves — and law enforcers — to illegal conduct occurring on, or facilitated by, the online spaces they create, is not consistent with that purpose. 

We want to engage further with experts, industry, and other government actors, including the NAAG, through informal discussions as well as a public workshop.

III. Coordination is Key

As we look at Section 230, antitrust, and other issues raised by the online platforms, it is important to take a coordinated approach. 

The issues raised by online platforms are interrelated, and we sometimes must weigh competing interests in forming positions related to the digital economy. 

Privacy is a good example.  Overbroad and overly burdensome privacy legislation could inhibit competition by entrenching monopolists with the resources to comply, while thwarting newer entrants who do not have those resources.

A single-minded focus on privacy, above all other values, also can impose significant costs, including costs to public safety.  I have, for example, spoken before about the dangers of warrant-proof encryption.  I won’t repeat myself here, but would simply reiterate that technological innovations that purport to protect privacy at all costs – while impeding sworn law enforcers’ ability to go after violent criminals, child predators, human traffickers, and terrorists, even once the enforcers satisfied the rigorous privacy protections built into the Fourth Amendment — may not be worth the trade-off.

High level coordination in our review of market-leading online platforms also helps avoid imposing conflicting obligations or inconsistent policy positions.  This requires coordination both within and outside DOJ. 

While we have some of the best and brightest at the DOJ’s Antitrust Division and across the Department working on these issues, we benefit from the perspective and support of our State AG, federal, and international partners.  We are also welcoming consumers, businesses, experts, and others to talk and work with us to address the challenges of the digital age.

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The technology industry in America has brought great innovations to consumers in the US and around the world.  We must continue to encourage and incentivize innovation and economic growth.  This means not unfairly punishing innovators that have earned their success on the merits.  But it also means making sure markets are competitive and open to the next wave of technological change. 

As law enforcers, we also must keep up with technological advancements to best protect our citizens.  This is why we have made the review of market-leading online platforms a top priority of the Department. 

The State AG community plays a very important role in this endeavor.  On behalf of DOJ, I thank you all for your valuable partnership and look forward to our continued work together on this and many other initiatives.

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Author: December 10, 2019