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An experienced whistleblower attorney, successful trial attorney, former criminal prosecutor, and former reporter Representing whistleblowers reporting fraud on the Federal State Governments

Marijuana may be legal in some states in the United States, but it is federally prohibited. This means it is illegal to bring marijuana bought in Canada across the border into the United States.
This is the case even if you are flying into a state where it is legal, such as Colorado.  Crossing international borders with cannabis is illegal.
Flying with pot from Vancouver to Montreal, on the other hand, is perfectly legal so long as you meet the age requirement and carry no more than 30 grams of cannabis.

Harmful drugs are commonly found in dietary supplements people take for weight loss, or muscle building, sexual enhancement or general health according to a new analysis. When California health department researchers took a closer look at more than 700 supplements subject to warnings from the FDA over a 10-year span, they often found drugs like sildenafil (Viagra), the heart drug sibutramine, and synthetic steroids, all of which could be harmful.

50% of adults in the U.S.  consume dietary supplements, which is now a $35 billion industry. These supplements include vitamins, minerals, botanicals, amino acids, and enzymes that according to the US Food and Drug Administration (FDA) are not intended to treat or prevent disease.  In the recent study, c ertain drug ingredients were commonly detected across products marketed for the same purposes . Overall, 287 of 353 adulterated sexual enhancement supplements (81.3%) contained sildenafil (166 of 353 [47.0%]) and/or at least 1 of its structural analogues (134 of 353 [38.0%]). Sildenafil is the active pharmaceutical ingredient in Viagra, which is a prescription medication manufactured by Pfizer Inc for erectile dysfunction. Analogues are metabolized in the body into active pharmaceutical ingredients. In the beginning of the 10-year period from 2007 through 2016, analogues of sildenafil were detected in a majority of adulterated sexual enhancement supplements (Figure 2). In 2012, however, the proportion of products containing sildenafil began to increase.

Harvard’s Dr. Pieter Cohen — who penned a commentary that accompanies the study — says the FDA’s “dereliction of duty” is to blame for tainted supplements still on the market. He says that the FDA plays an essential role in ensuring the safety of vitamins.  He also suggests that there are major deficiencies in the FDA’s regulation of supplements.

Presently the U.S. government oversees the major existing whistleblower programs and laws, including False Claims Act (FCA) cases through the Department of Justice, the IRS whistleblower program, the Securities and Exchange whistleblower program the Commodities Futures Trading Commission Commision whistleblower program and a few others. Some other nations have created whistleblower programs all overseen by their government agencies.  These are all administered by the governments and they allow for a reward to the whistleblower of a percentage of what the government recovers. These programs and the private actions filed under the False Claims Act are the key means by which major corporate and personal frauds are revealed and “remedies” are rendered to the wrongdoers. The programs and whistleblowers are useful in our society and also the global marketplace as the wrongdoing and fraud is so rampant and damaging to the economic mechanisms set up to allow corporations, individuals and nations to deal with each other in a competitive environment.

Now there is a need for a private, non-governmental whistleblower program to prevent fraud and different forms of wrongdoing, including international cybercrime and international fraud which is threatening the legal interplays between nations. Fortune 500 companies including the most powerful ones such as Google, Amazon, Apple, Facebook, Exxon, General Motors and so many others have a unique opportunity to create a means by which the private forces of industry may police themselves and the governments of the world through the creation of a whistleblower program overseen by representatives of the different corporate entities. Once the critical information concerning corporate or governmental wrongdoing is investigated, the information can, in some instances be sent to the appropriate legal authorities or, in the case of fraud or wrongdoing could be rendered to the entities who suffered damages for private lawsuits or other means of redress.

The concept has distinct advantages, for example in the case of privacy invasions which have been directed at so many of these companies. It could also reveal extensive counterfeiters and violators of Trademarks would allow for revelations that would help deter and prevent these activities as the cost would be too great. There are those who will say that we would be creating a world of snitches but given the enormous harm being created by the various world interests now, including governmental interference with other nations, whistleblowers can help enable fair dealings and increase the sanctions for violations of national and international laws. One of the most significant benefits of such a program is that the information about a corporate, personal or governmental fraud can be interdicted early enough to prevent a continuation of serious wrongdoing which can victimize millions including the prevention of privacy invasions and cybercrime.

 

J.P. Morgan Chase will pay $5.3 million to settle charges that it violated various U.S. sanctions programs. The charges were connected to its failures in screening processes says the U.S. Treasury Department .This concerns 87 net-settlement transactions between January 2008 and February 2012 which amount to more than $1 billion.

This resolves potential civil liability for 87 apparent violations of the Cuban Assets Control Regulations, 31 C.F.R. Part 515 (CACR); the Iranian Transactions and Sanctions Regulations, 31 C.F.R. Part 560 (ITSR); and the Weapons of Mass Destruction Proliferators Sanctions Regulations, 31 C.F.R. Part 544 (WMDPSR).

Information concerning the civil penalties process is discussed in OFAC regulations governing the various sanctions programs and in 31 CFR part 501. On November 9, 2009, OFAC published as Appendix A to part 501 Economic Sanctions Enforcement Guidelines. See 74 Fed. Reg. 57,593 (Nov. 9, 2009). The Economic Sanctions Enforcement Guidelines, as well as recent final civil penalties and enforcement information, can be found on OFAC’s Web site at http://www.treasury.gov/ofac/enforcement. ENTITIES – 31 CFR 501.805(d)(1)(i) JPMorgan Chase Bank, N.A. Settles Potential Civil Liability for Apparent Violations of Multiple Sanctions Programs: JPMorgan Chase Bank, N.A. (JPMC) has agreed to remit $5,263,171 to settle its potential civil liability for apparent violations involving the processing of 87 net settlement payments with a total value of $1,022,408,149, of which approximately $1,500,000 (0.14%) appears to have been attributable to interests of sanctions-targeted parties, and which therefore appear to have violated one or more of the following sanctions programs administered by OFAC: the Cuban Assets Control Regulations, 31 C.F.R. Part 515 (CACR); the bank was apparently aware that it processed net settlement transactions on behalf of the two member organizations on a weekly basis, and, given the bank’s involvement in reconciling the organizations’ billings against each other, JPMC staff members had actual knowledge of the individual members, including OFAC-sanctioned entities, involved in each transaction; ·

JPMC’s activity conveyed economic benefit to several entities subject to OFAC sanctions and harmed the integrity of a number of OFAC sanctions programs; and JPMC is a large and commercially sophisticated financial institution. OFAC considered the following to be mitigating factors: · no JPMC managers or supervisors appear to have been aware of the conduct or transactions that led to the apparent violations; · the total harm caused to OFAC sanctions programs was significantly less than the total value of the transactions because the transactions represented net settlements between numerous parties, of which the sanctioned entities were only a few; · JPMC cooperated with OFAC’s investigation of the apparent violations, including by entering into a retroactive tolling agreement (and multiple extensions thereof) to toll the statute of limitations; · JPMC has taken the following steps as part of a risk-based sanctions compliance program to prevent similar apparent violations in the future: o Between February 2012 and the termination of JPMC’s relationship with its U.S. entity client, JPMC screened all net settlement participants in order to prevent sanctioned entities from utilizing the net settlement process; o JPMC has increased its compliance staff; o JPMC has implemented new sanctions-screening software; and 3 o JPMC has enhanced employee training and has previously used these apparent violations as a case study for training purposes. This enforcement action highlights the risks associated with a U.S. person failing to take adequate steps to ensure that transactions that it processes are compliant with U.S. economic sanctions laws — particularly in instances in which a U.S. person has actual knowledge or reason to know, prior to the transaction being effected, of an SDN’s past, present, or future interest in such a transaction. Separately, JPMorgan Chase & Co. Receives a Finding of Violation Regarding Violations of the Foreign Narcotics Kingpin and Syrian Sanctions Regulations: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has issued a Finding of Violation to JPMorgan Chase & Co. (“JPMC”) for violations of the Foreign Narcotics Kingpin Sanctions Regulations, 31 C.F.R. part 598 (FNKSR), and the Syrian Sanctions Regulations, 31 C.F.R. part 542 (SSR).

Between August 4, 2011 and April 29, 2014, JPMC processed 85 transactions totaling $46,127.04 and maintained eight accounts on behalf of six customers who were contemporaneously identified on the List of Specially Designated Nationals and Blocked Persons (“SDN List”). From approximately 2007 to October 2013, JPMC used a vendor screening system that failed to identify these six customers as potential matches to the SDN List. The system’s screening logic capabilities failed to identify customer names with hyphens, initials, or additional middle or last names as potential matches to similar or identical names on the SDN List. Despite strong similarities between the accountholder’s names, addresses, and dates of birth in JPMC account documentation and on the SDN List, JPMC maintained accounts for, and/or processed transactions on behalf of, these six customers. JPMC identified weaknesses in the screening tool’s capabilities as early as September 2010 and implemented a series of enhancements during the period 2010 to 2012. In 2013, JPMC transitioned to a new screening system. In November 2013, JPMC re-screened 188 million clients’ records through the new system, identified the transactions and accounts described above, and reported the violations to OFAC. The determination to issue a Finding of Violation to JPMC reflects OFAC’s consideration of the following facts and circumstances, pursuant to the General Factors under OFAC’s Economic Sanctions Enforcement Guidelines, 31 C.F.R. part 501, app. A. A Finding of Violation is appropriate given that JPMC facilitated and/or processed 85 transactions totaling $46,127.04, and maintained eight accounts on behalf of six customers on the SDN List; JPMC engaged in a pattern of conduct over a two-year period where the apparent violations stemmed from the same screening issue; although JPMC identified this screening issue and implemented multiple screening enhancements, it took over three years to fully address a known deficiency in the vendor-provided screening system; JPMC did not appear to have implemented adequate compensating controls to address the risk these screening deficiencies posed to the bank’s operation of existing accounts or opening of new accounts; and JPMC is a large, sophisticated financial institution. OFAC also considered that no JPMC personnel, including managers or supervisors, appear to have had actual knowledge of the conduct that led to the violations; JPMC has not received a penalty notice or Finding of Violation from OFAC relating to substantially similar violations in the five years preceding the date of the conduct giving rise to the violations; and JPMC cooperated with OFAC’s investigation, including by providing the initial disclosure of these violations, and executing a statute of limitations tolling agreement and an extension to the agreement. 3 This enforcement action highlights the importance of financial institutions remediating known compliance program deficiencies in an expedient manner, and when that is not possible, the importance of implementing compensating controls to mitigate risk until a comprehensive solution can be deployed. For more information

Separately, OFAC has issued a Finding of Violation to JPMC regarding violations of the Foreign Narcotics Kingpin Sanctions Regulations, 31 C.F.R. part 598 (FNKSR), and the Syrian Sanctions Regulations, 31 C.F.R. part 542.  Specifically, OFAC determined that between August 4, 2011 and April 29, 2014, JPMC processed 85 transactions totaling $46,127.04 and maintained eight accounts on behalf of six customers who were contemporaneously identified on the SDN List.  OFAC determined that JPMC voluntarily disclosed the violations, and that the violations constitute a non-egregious case.

Before 2012, JPMorgan didn’t appear to have had a process to evaluate members independently of the foreign entity despite receiving red-flag notifications on at least three occasions.

According to an investigative report in the Wall Street Journal, the heavy tariffs imposed on Chinese goods has resulted in a large increase in tariff evasion schemes by Chinese companies seeking to sell their goods here.  Customs officials, importers and shipping brokers say that the tariff increases are being countered by unscrupulous Chinese manufacturers who are fraudulently shipping products here under false manufacturers codes and through trans-shipping and falsifying the actual country of origin, according to the Wall Street Journal. The result is that the tariffs are failing to protect. The tariff evasion using fraudulent product codes relates to 10-digit designation called an HTS code, of which there are 18,927. These codes are required to identify products and varieties. Unscrupulous manufacturers seeking to evade our tariffs send the products in with codes which designate products which are not on the tariff list.https://www.wsj.com/articles/the-u-s-china-trade-battle-spawns-a-new-era-of-tariff-dodges-1539009200?mod=hp_lead_pos5
One indicator of the misclassification increase is that there were 146 rulings in July, nearly triple the number six months earlier and this is considered the tip of the iceberg. In one example included in the WSJ article, a wood importer in Oregon received a call from a supplier asking if he would like some Chinese plywood tariff free. The importer asked how this would happen and the response was don’t worry about it as the plywood would not contain any Chinese markings and it would be shipped under some other code.
Diamond saw blades made in China now carry  82% tariffs.  In July, two California importers controlled by a Chinese manufacturer tried to dodge the tariff by coding diamond saw blades as grindstonesaccording to Customs. The maker, Danyang Like Tools Manufacturing Co., claimed independent of the California importers but  one of them told the agency Danyang was its owner. The California firms have disputed the charges.

A Chinese-led coalition threatens to further tighten control of the rare earths trade with the purchase of the only operational rare earth metals mine in America. The Mountain Pass Mine in the California desert south of Las Vegas was a powerhouse producer of REEs from 1965 to 1985, at which point China took over global production and never looked back. Mountain Pass was shuttered from 2002 to 2012 because it couldn’t compete with the low prices coming out of China. After a brief revival from 2012 to 2015, Mountain Pass closed for good in 2016 and its owner, Molycorp, filed for bankruptcy. This past June, an investor group with alleged ties to the Chinese government bought the mine for $20.5 million, beating out American bidders including entrepreneur Tom Clarke of ERP Strategic Minerals.

AmerisourceBergen Corporation and its subsidiaries  have agreed to pay $625 million to settle charges  that improperly repackaged oncology-supportive injectable drugs into pre-filled syringes and improperly distributed those syringes to physicians treating vulnerable cancer patients.  Last year, AmerisourceBergen Specialty Group, a wholly-owned subsidiary of AmerisourceBergen Corporation, pled guilty to illegally distributing misbranded drugs and agreed to pay $260 million to resolve criminal liability for its distribution of these drugs from a facility that was not registered with the Food and Drug Administration (FDA).  The settlement announced today resolves ABC’s civil liability to the United States under the False Claims Act for causing false claims for the drugs it repackaged to be submitted to federal health care programs.

The United States contends that ABC sought to profit from the excess drug product or “overfill” contained within the original FDA-approved sterile vials for these cancer supportive injectable drugs by establishing a pre-filled syringe program through a subsidiary that it claimed was a pharmacy.  The United States alleged that the “pharmacy” was in reality a repackaging operation that created and shipped millions of pre-filled syringes to oncology practices for administration to cancer-stricken patients.  As part of this operation, ABC purchased original vials from their respective manufacturers, broke their sterility, pooled the contents, and repackaged the drugs into pre-filled syringes. The United States alleged that ABC never submitted any safety, stability, or sterility data to the FDA to show that its operation ensured the safety and efficacy of the repackaged drug products.  It further alleged that, at times, these pre-filled syringes were prepared in non-sterile conditions, contaminated with bacteria and other unknown particles, and lacked the required quality and purity.In addition, by harvesting the overfill, ABC was able to create more doses than it bought from the original vial manufacturers.  The United States alleged that ABC’s scheme enabled it to bill multiple health care providers for the same exact same vial of drug, causing some of those providers to bill the Federal Health Care Programs for the same vial more than once.  The scheme also allegedly enabled ABC to increase its market share by offering various product discounts, which it leveraged to obtain new customers and to keep existing customers buying its entire portfolio of oncology drugs.

“The $885 million combined civil and criminal resolution with ABC underscores our determination to utilize all tools at our disposal to pursue illicit schemes that seek to profit from circumvention of important safeguards designed to protect the nation’s drug supply,” said Assistant Attorney General Joseph H. Hunt of the Department of Justice’s Civil Division.  “We will continue to be particularly vigilant where these schemes put the health and safety of vulnerable patients at risk.”

HealthCare Partners Holdings LLC, d/b/a DaVita Medical Holdings LLC (DaVita), will pay $270 million to settle its False Claims Act liability for providing inaccurate information causing Medicare Advantage Plans to receive increased Medicare payments. DaVita voluntarily disclosed that caused MAOs to submit incorrect diagnosis codes to CMS and obtain inflated payments in which DaVita and HealthCare Partners shared.  For example, HealthCare Partners disseminated improper medical coding guidance instructing its physicians to use an improper diagnosis code for a particular spinal condition that yielded increased reimbursement from CMS.  Based on these self-disclosures, and DaVita’s cooperation with the government’s subsequent investigation, the United States agreed to a favorable resolution of potential claims arising from the conduct.

The settlement also resolves allegations made by a whistleblower that HealthCare Partners engaged in “one-way” chart reviews in which it scoured its patients’ medical records for diagnoses its providers may have failed to record.  It then submitted these “missed” diagnoses to MAOs to be used by them in obtaining increased Medicare payments.  At the same time, it ignored inaccurate diagnosis codes that should have been deleted and that would have decreased Medicare reimbursement or required the MAOs to repay money to Medicare.

The allegations of “one-way” chart reviews were brought in a lawsuit under the qui tam, or whistleblower, provisions of the Federal False Claims Act. This statute permits private parties to sue on behalf of the government for false claims and to receive a share of any recovery. The whistleblower in this action is James Swoben, who was a former employee of an MAO that did business with DaVita. Mr. Swoben will receive $10,199,100 for the settlement of the “one-way” allegations.

Hedge fund Harbinger Capital Partners Offshore Manager has agreed to pay $30 million to settle a lawsuit filed by the state of New York claiming the hedge fund manager knowingly evaded New York state and city taxes. A statement issued by the New York attorney general’s office claims that Harbinger concealed income it earned while doing business in New York.

“Harbinger Capital Partners Offshore Manager earned hundreds of millions of dollars in New York state and New York City, but deliberately dodged paying its fair share of taxes,” Attorney General Barbara D. Underwood said in the release. “Tax evasion forces ordinary New Yorkers to shoulder the bill. My office will continue to use every tool at our disposal to pursue those who knowingly violate the tax law and hold them accountable.” The suit resulted from an investigation that was launched after a whistleblower lawsuit was filed in March 2015.

The settlement agreement in the case states that the offshore manager for the Fund failed to pay an unincorporated business tax that it had previously agreed to pay in the amount of $4,115,239. In addition, it says that for three years it did not file city UBT returns. “Because it carried on its business in New York, Offshore Manager had an obligation under the New York State Tax Law to apportion and allocate income as taxable in New York State. ”

Attorneys for Howard Wilkinson, the whistleblower who discovered and revealed the 235 plus billion dollars of Russian money laundering scandal at Denmark’s Danske Bank are demanding that steps be taken to protect him from retaliation. An Estonian newspaper last week identified him as the whistleblower an act which his lawyer say was illegal. Both Estonia and Denmark have signed international treaties to support whistleblowers and protect their identities. In addition, his counsel is fearful that harm might befall Mr. Wilkinson from the Russian entities which participated in the money laundering.

Danske Bank has admitted, after an internal investigation, that some 200 billion euros flowing through its accounts were suspicious. Its CEO resigned.  It is still not presently clear who in Russia moved the $235 Billion through the bank. Denmark’s financial regulator reopened a probe that it had closed in May and the top prosecution authority opened a criminal investigation.

The Danish paper Berlingske, which received an email from him after he was named in Estonian media, reports that Wilkinson is a British citizen who headed Danske Bank’s trading unit in the Baltics.