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Rick Perry: Corporate Espionage going by Russia and China

Rick Perry: Russian, Chinese Corporate Espionage ‘Shouldn’t Surprise Anybody’

Russia and China are engaging in underhanded business practices involving American oil and gas companies, according to Energy Secretary Rick Perry.

During an appearance on Fox Business Tuesday morning, Perry said it “shouldn’t surprise anybody that there is corporate espionage going on” in Russia and China, particularly with U.S. companies that are involved in hydraulic fracturing or fracking.

The secretary also addressed a recent column from Fox Business contributor James Freeman, which detailed a congressional investigation into allegations of a Russian effort to undermine and “suppress our domestic oil and gas industry, specifically hydraulic fracking,” according to a statement from House Science Committee Chairman Lamar Smith.

“When you think about Russia and China a lot of the businesses there have direct links back to their government,” Perry said. “So the idea that there are people trying to manipulate, to put propaganda out on a particular type of fuel, that doesn’t surprise me.”

He added that his case highlights the importance of cybersecurity.

“We need to be sophisticated when it comes to how we deal with Russia, how we deal with China,” he said. “Those are our competitors out there and we know that they may play with a different set of rules and we just need to be smart enough to identify.”

***

Rick Perry is more than right.

Primer 2013:

U.S. military operations, the security and the well being of U.S. military personnel, the effectiveness of
equipment, and readiness. China apparently uses these intrusions to fill gaps in its own research
programs, map future targets, gather intelligence on U.S. strategies and plans, enable future military
operations, shorten research and development (R&D) timelines for military technologies, and identify
vulnerabilities in U.S. systems and develop countermeasures.
China’s cyber espionage against U.S. commercial firms poses a significant threat to U.S. business
interests and competiveness in key industries.
General Keith Alexander, Director of the National Security Agency and commander of U.S. Cyber Command, assessed that the financial value of these losses is about $338 billion a year, including intellectual property losses and the down time to respond to penetrations, although not all those losses are to Chinese activity. Chinese entities engaging in cyber and other forms of economic espionage likely conclude that stealing intellectual property and proprietary information is much more cost
effective than investing in lengthy R&D programs.
***

Example/2015: WASHINGTON—Six Chinese citizens, including two professors who trained together at the University of Southern California, stole sensitive wireless technology from U.S. companies and spirited it back to China, the Justice Department charged.

Example/2014: In one of the most notable actions, Dongfan “Greg” Chung, a naturalized American citizen who worked on NASA’s space shuttle program, was convicted in 2009 after investigators found hundreds of thousands of sensitive papers under his California home. Prosecutors said he gave some of the documents to Chinese officials, revealing details of military and space-related technology. Chung, a former Boeing employee, was sentenced to more than 15 years in prison.

***

Chinese Industrial Espionage: Technology Acquisition and Military Modernization provides the most thorough and insightful review to date of the covert and overt mechanisms China uses to acquire foreign technology. Delving into China’s “elaborate, comprehensive system for spotting foreign technologies, acquiring them by every means imaginable and converting them into weapons and competitive goods,” the book concludes that “there is nothing like it in the world.” (2-3) The People’s Republic of China (PRC)  is implementing  “a deliberate, state-sponsored project to circumvent the costs of research, overcome cultural disadvantages and ‘leapfrog’ to the forefront by leveraging the creativity of other nations,” thereby achieving  “the greatest transfer of wealth in history.” (78, 216)

Although PRC espionage is global in scope, the most important target is the United States. Relying primarily on Chinese-language government and non-government sources, the coauthors intend to raise awareness of the threat nationally and alert decisionmakers to the gravity of the problem. Trained as Chinese linguists, with considerable experience dealing with Chinese affairs, they are uniquely qualified for the task. William C. Hannas has a Ph.D. in Asian languages, published two books on Asian orthography and served in various US government posts, including at the Joint Special Operations Command. James Mulvenon is a leading expert on Chinese cyber issues and has published widely on China’s military affairs and communist party-army relations. Senior analyst Anna B. Puglisi studied in Beijing and subsequently was a visiting scholar at Nankai University, where she studied China’s science and technology (S&T) policies and infrastructure development.

Download PDF for complete review. [PDF 264.1KB*]

412 Charged in $1.3 Billion in Opioid Schemes

U.S. charging 412 in health fraud, opioid schemes worth $1.3 billion

ChicagoTribune: More than 400 people have been charged with taking part in health care fraud and opioid scams that totaled $1.3 billion in false billing, Attorney General Jeff Sessions announced Thursday.

Sessions called the collective action the “largest health care fraud takedown operation in American history” and said it indicates that some doctors, nurses and pharmacists “have chosen to violate their oaths and put greed ahead of their patients.”

Among those charged are six Michigan doctors accused of a scheme to prescribe unnecessary opioids. A Florida rehab facility is alleged to have recruited addicts with gift cards and visits to strip clubs, leading to $58 million in false treatments and tests.

In the Northern District of Illinois, 15 people were charged in six cases involving an alleged $12.7 million in billing fraud of private insurers and government programs. At least two Chicago-area physicians, nurses, chiropractors and at least one physical therapist were among those indicted. In the Southern District of Illinois, five people were charged in separate alleged schemes to defraud Medicaid.

Related:

Officials said those charged in the schemes include more than 120 people involved in illegally prescribing and distributing narcotic painkillers. Such prescription opioids are behind the deadliest drug overdose epidemic in U.S. history. More than 52,000 Americans died of overdoses in 2015 — a record — and experts believe the numbers have continued to rise.

“In some cases, we had addicts packed into standing-room-only waiting rooms waiting for these prescriptions,” acting FBI director Andrew McCabe said. “They are a death sentence, plain and simple.”

Nearly 300 health care providers are being suspended or banned from participating in federal health care programs, Sessions said.

“They seem oblivious to the disastrous consequences of their greed. Their actions not only enrich themselves, often at the expense of taxpayers, but also feed addictions and cause addictions to start,” Sessions said.

Health care fraud sweeps like Thursday’s happen each year across the country, but law enforcement officials continue to grapple over the best way to fight the problem.

The people charged were illegally billing Medicare, Medicaid and the health insurance program that serves members of the armed forces, retired service members and their families, the Justice Department said. The allegations include claims that those charged billed the programs for unnecessary drugs that were never purchased or given to the patients.

Inside an FBI opioid task force:

How Hillary’s Lawyers and DoJ Obstructed on Emails

FBI document dump reveals secrets of Clinton probe as new director nominee faces Senate

FNC: Some 42 pages of highly redacted documents from the FBI’s criminal investigation into Hillary Clinton’s mishandling of highly classified materials paint a picture of a serious, but flawed investigation hindered by a lack of cooperation, according to a key watchdog group.

The materials, all part of the probe dubbed “Midyear Exam,” included several documents designated as “grand jury material,” indicating the potential seriousness of the investigation that would ultimately be ended by FBI director James Comey in July, then restarted for a brief period in October before being shut down for good.

One redacted exchange reveals a back and forth subpoena response to the FBI from one of Mrs. Clinton’s private attorneys, Katherine Turner, a partner at Washington DC powerhouse firm Williams & Connolly. In the document, Turner agreed to turn over one of Mrs. Clinton’s non-secure Apple iPads and two of her BlackBerrys to the FBI.

But neither smartphone received from the law firm contain SIM cards or Secure Digital (SD) cards, and a total of 13 mobile devices identified by the FBI as potentially using clintonemail.com email addresses were never located by Williams & Connelly.

“We are presuming there are still 13 devices at issue,” Tom Fitton, president of Judicial Watch, told Fox News. “The new records show how badly the Obama Justice Department and FBI mishandled the Clinton email investigation. They get the equivalent of wiped phones from the Clinton lawyers and do nothing?”

IJR

READ THE DOCUMENTS

As extensively reported by Fox, Clinton would often task aides including Monica Hanley with finding and supplying the secretary of state’s never-ending demand to use non-secure BlackBerrys for all her official government work.  Some of Clinton’s BlackBerrys wound up being pounded with hammers on orders by Huma Abedin after Clinton’s homebrew servers went down or when news that Clinton confidant Sidney Blumenthal’s email had been hacked in 2013 by the Romanian hacker known as “Guccifer”—Marcel Lehel Lazar.

The new documents offer a glimpse into the lawyering ballet inside the Beltway—as this surrendering of two BlackBerrys and one iPad by her private attorneys occurred just six days before Hillary Clinton, then the leading Democratic nominee for president, testified before Congress on Oct. 22, 2015 about the 2012 terrorist attack in Benghazi, Libya.

In a photo captured in the Benghazi hearing, Turner and her law partner David Kendall pointedly flanked Clinton during her marathon testimony before the House Select Committee on Benghazi. Also hovering nearby was longtime Clinton aide Cheryl Mills, who was also at the epicenter of Clinton’s deliberative use of a non-secure email system while she headed one of the most sensitive federal agencies in the U.S. government.

Mills, who was Clinton’s chief of staff and counselor at State, received immunity for her cooperation into the email investigation was permitted to be in the room while Clinton interviewed by the FBI in July 2016. Comey would later admit publicly that he had never heard of a potential witness representing the subject of an FBI investigation to be present during an interview with investigators.

Nearly a year has passed since Comey’s then-boss, Attorney General Loretta Lynch, held her infamous tarmac meeting with Bill Clinton in Phoenix, Arizona. Eight days later, Comey announced on July 5, 2016, that “regarding the handling of classified information, our judgement is that no reasonable prosecutor would bring such a case.”

Comey made his determination despite noting that Clinton and her colleagues “were extremely careless in their handling of very sensitive, highly classified information,” and even though 22 top secret email exchanges deemed too damaging to national security to release. Some of those exchanges contained Special Access Privilege (SAP) information characterized by intel experts as “above top secret.”

“They (the FBI) were played by Mrs. Clinton’s lawyers and didn’t care,” Fitton said. “The Trump Justice Department needs to audit this mess and figure out if the Clinton matters need to be reopened or reinvigorated.”

In the latest documents dumped by the FBI, a whopping 325 pages are cited as “total deleted pages.” The 42 pages that were released and are only readable in parts include 177 redactions. The redactions include those made citing Freedom of Information Act exemptions under (b) (7) (e) in which the information is denied because revelations could “disclose investigation techniques.“

Now—64 days after James Comey was fired by President Donald Trump as the director of the FBI, Christopher Wray is scheduled to sit down before the Senate Judiciary Committee for the start his confirmation process.

Two former agents with the FBI told Fox News they hope that “the atmosphere is changed with a new director.”

Natalia Veselnitskaya, Prevezon, Brooklyn, NY and Money Laundering

Natalia Veselnitskaya had clients to defend in New York. Those clients were Denis Katsyv, Alexander Litvak, and Timofey Krit. Natalia had expensive choices in accommodations in New York where the U.S taxpayer paid the bill.

Prevezon Holdings was part of a money laundering prosecution case in Southern District of New York that for the most part was settled in May of 2017. Prevezon is/was owned by Denis Katsyv and has a principal by the name of Timofey Krit. The Prevezon office was located in Brooklyn, New York. The registered agent for Prevezon is Gabriella Volshteyn.

Gabriella Volshteyn is a founder and a managing attorney of Volshteyn & Associates. The lawfirm boasts the following on the website:

In our Real Estate practice, we have participated in over $1 billion of transactions in commercial and residential real estate involving both the US-based and international corporate entities and individuals.

In our  Business and Contract Law practice, we have represented a full range of clients from individuals and small business owners to large multinational holding companies. We have drafted contracts ranging from simple corporate agreements to complex contractual agreements related to large-scale international events, such as Sochi Olympic Games.

In our Global Corporate and Tax practice, we have considerable expertise in structuring complex corporate, banking and investment accounts for foreign investors and the establishment of offshore trusts in tax-favored jurisdictions, such as the British Virgin Islands, the Cayman Islands, the Bahamas, the Netherlands, Antilles, the Channel Islands, Panama, Switzerland, Liechtenstein and Madeira.

Our Surrogacy Law practice is an area of passion for this firm as we have been fortunate to help many families from all over the world with bringing a child in their lives.  With the help of our firm, surrogacy has made the dream of having children possible for those who are infertile, unable to become pregnant, or unable to carry a child to term.

(of note, the countries listed above are those that are known to be quite common in use by front companies to hide money, evade taxes and park laundered funds)

*** While Donald Trump Jr. had a meeting on June 6, 2016 with Natalia Veselnitskaya, the meeting allegedly had several objectives including opposition intelligence on Hillary Clinton, getting waivers or removal of sanctions from the Magnitsky Act and later Russian adoption. Donald Jr. included Jared Kuschner and Paul Manafort in the meeting without vetting Natalia or on background the sanctions. Natalia also does have ties to former top members of GRU and FSB. As a normal practice, the Kremlin always dispatches operatives that are at least one layer removed from listed official positions of the Russian government.

A particular group of note for which Veselnitskaya was involved and is a large lobby operation in Washington DC is HRAGI, a front operation on human rights known as Human Rights Accountability Global Initiative Foundation. Those involved in the lobby operation on behalf of HRAGI and Prevezon include:

A. Rinat Akhmetshin – Russian national living in Washington D.C.
B. Robert Arakelian
C. Chris Cooper – CEO Potomac Square Group
D. Glenn Simpson – SNS Global and Fusion GPS
E. Mark Cymrot – Partner, Baker Hostetler
F. Ron Dellums – Former Republican Congressman (correction, Dellums is Democrat of operative status)
G. Howard Schweitzer – Managing Partner of Cozen O’Connor Public
Strategies

In more detail as published by Senator Grassley’s office:

The Russian Government also has a vested interested in ensuring that Prevezon
Holdings Limited and its affiliated companies successfully defend asset forfeiture
proceedings brought against them by the United States Government in New
York, in which Prevezon is accused of laundering proceeds of the $230 million
fraud.
Prevezon is owned by Denis Katsyv, the son of a Russian government official,
Piotr Katsyv. Denis Katsyv currently has $7million frozen by the Swiss General
Prosecutor, pursuant to a criminal investigation by the Swiss authorities into the
laundering of proceeds from the $230 million fraud. More here.

***

Another issue is Jared Kushner.

HRAGI’s other clients include Vladimir Lelyukh, a top executive at Sberbank Capital, a subsidiary of the state-owned Russian bank involved in the real estate, energy, transportation, and automotive sectors. Sberbank Capital’s CEO, Ashot Khachaturyants, is a former senior official in Russia’s Federal Security Service (FSB) and its Ministry of Economic Development and Trade.
State-owned Russian financial institutions are common conduits for surreptitious intelligence work in the country. Jared Kushner, the president’s son-in-law and senior adviser, has faced scrutiny over a January meeting a top executive at another bank with ties to Russian intelligence, Moscow-based Vnesheconombank. For context and validation, go here.

Vnesheconombank was sanctioned by the U.S. Treasury in 2014 due to Russian annexation of Crimea and Ukraine.

Vnesheconombank also known as VEB bank has the following officers:

 

Mosul Liberation, Raqqa Next, A View in History

War is an ugly thing is clearly an understatement.

Then there is Aleppo, Syria.

WashingtonPost: In 1165, Benjamin of Tudela, a medieval Spanish Jewish traveler, approached the city of Mosul on the banks of the Tigris. A visitor, even a thousand years ago, could marvel at its antiquity. “This city, situated on the confines of Persia, is of great extent and very ancient,” he wrote in the chronicle of his journey. He gestured to the adjacent ruins of Nineveh, which had been sacked 15 centuries before his arrival.

Mosul, perched in Mesopotamia’s fertile river basin, was a walled trade city at the heart of the proverbial cradle of civilizations, linked to caravan routes threading east and other venerable urban centers like Aleppo to the west. It’s a city that has endured centuries of war and conflict, devastation and renewal. And even a millennium ago, though they couldn’t fathom its later uses, people were aware of Mosul’s great natural resource: Oil.

“To the right of the road to Mosul,” noted another 12th century Arab traveler, “is a depression in the earth, black as if it lay under a cloud. It is there that God causes the sources of pitch, great and small, to spurt forth.”

***

Mosul in the Middle Ages

In the wake of the First Crusade, which led to a string of Christian Crusader states taking root along the eastern coast of the Mediterranean, Mosul became one of the main staging grounds for the Muslim riposte. At the time, the city was ruled by Seljuks, a Turkic tribe that had settled across swathes of the Middle East.

In 1104, an army led by the Seljuk “atabeg,” or governor, of Mosul marched west and routed a Crusader force on a plain close to what’s now the modern-day Syrian city of Raqqa, the de facto capital of the Islamic State. “For the Muslims, it was an unequaled triumph,” wrote one Arab chronicler. “The morale of the Muslims rose, their ardor in defense of their religion was enhanced.” In 1127, Imad ad-din Zengi became Mosul’s atabeg and went on to forge a regional empire that united Aleppo with Mosul and successfully took the Crusader fortress at Edessa.

Zengi’s dynasty, installed in Mosul, went on to rival both the Christian knights in the Levant and the Caliph in Baghdad. Even when the famed Kurdish general Salah ad-Din, the greatest Muslim hero in the history of the Crusades, took over a vast swathe of the Middle East toward the end of the 12th century, the Zengids of Mosul held out. Their resistance was broken in the following century — not by Crusaders or rival Muslim armies, but the conquering hordes of the Mongols.

Despite all the conflict, the city and its environs would preserve its diverse character and remain home to Muslims, Jews, Christians and other sects, as well as a busy commercial entrepot for all sorts of goods. Though produced much farther east in Bengal, the ultra-soft and light fabric known as “muslin” derives its name from Mosul, because that was the point from which this textile entered the European imagination.

An Ottoman province

By the mid-16th century, Mosul fell under Ottoman control following the successful campaigns of Turkish armies against those of Persia’s Safavid dynasty. Most of what we know as the Arabic-speaking Middle East now ruled by the Ottomans. The Ottoman-Persian rivalry, which included a dimension of Sunni-Shia strife, shaped the region’s geopolitics for centuries. The lands that now constitute Iraq, particularly its rugged north, would be the site of myriad border wars, skirmishes and sieges.

In the early 19th century, Mosul became the capital of an Ottoman vilayet, or province, that stretched over what’s now northern Iraq. After the empire’s collapse, British colonial rulers would stitch together the vilayets of Mosul, Baghdad and Basra — a sea port to the south whose environs were home to a mostly Shiite population — into the new nation of Iraq.

A legacy of Sykes-Picot

A British army marched into Mosul in 1918 toward the end of World War I, forever ending Turkish rule in Iraq. The map above, though, depicts a post-war settlement that never came about. The infamous Sykes-Picot agreement — a secret deal hatched in 1916 by the British and French diplomats whose name it still carries — carved up the lands of the Ottoman Middle East between rival spheres of British and French influence. In the initial scheme, Mosul would fall under a French protectorate; the city was seen as more closely linked to Aleppo in Syria than Baghdad at the time.

But the British coveted Mosul’s oil, while the French sought to maintain control of Syria, even though British forces had been the ones to take Damascus from the Ottomans during the war. A deal was struck that gave the British a mandate over Mosul and the French colonial rights over Syria and Lebanon. The Europeans reneged on assurances they had given Arab allies during World War I that they would allow an independent Arab state to emerge. Instead, the political map of the Middle East was shaped by British and French colonial concerns and “Sykes-Picot” became short-hand for a toxic legacy of foreign meddling and domination.

The integration of Mosul into the other vilayets to the south, writes Middle East historian Juan Cole, compelled the “British to depend on the old Ottoman Sunni elite, including former Ottoman officers trained in what is now Turkey. This strategy marginalized the Shiite south, full of poor peasants and small towns, which, if they gave the British trouble, were simply bombed by” the British air force.

The template was set. Iraq, under the rule of a British-installed monarchy, achieved independence in 1932. In a matter of decades, the monarchy would be abolished and, after a series of coups, the authoritarian Baathist party of Saddam Hussein took over. A cadre of Sunni political and military elites went on to dominate a majority Shiite nation until the 2003 U.S. invasion.

The Turkey that never was

In 1920, in its last session, a defeated Ottoman parliament declared in a six-point manifesto the conditions on which it would accept the end of World War I following the armistice in 1918. There are differing versions of the proposed borders of a shrunken Turkish state that the nationalists in the Ottoman parliament put forward — one of them is reproduced above. Some areas indicated would be allowed to hold referendums; others were considered integral Turkish territory. As you can see, though, Mosul was very much part of this vision.

Instead, the Ottoman court signed the withering Treaty of Sevres in 1920, which would have seen what’s now Turkey carved up into various spheres of influence controlled by the West, Kurds, Armenians and others. That never came to pass: Turkish nationalists in the Ottoman army mobilized and eventually forced out foreign forces. In the 1923 Treaty of Lausanne, Turkey’s modern borders were set.

Mosul, though, was a sticking point, with Turkish nationalists laying claim to it and demanding Britain hold a plebiscite in the region that’s now northern Iraq. That didn’t happen, and after some fitful politicking at the League of Nations, Turkey and Britain eventually agreed to an arrangement in 1926 where Ankara dropped its claim to Mosul and the nearby cities of Kirkuk and Sulaimanyah in exchange for a portion of the region’s oil revenues over the next 25 years.

This history has bubbled up once more in the wake of the Mosul offensive: Turkish President Recep Tayyip Erdogan, adamant that his country’s forces play a role in the mission, invoked the 1920 document when justifying his nation’s right to be “at the table.” Officials in Baghdad were not impressed.

The chaos of the moment

And here’s the current state of play. Mosul is now at the center of a regional conflagration: It’s occupied by an extremist Sunni organization that rose to power as the Iraqi and Syrian states imploded. An Iraqi government backed by pro-Iranian Shiite militias is seeking to retake the city with the aid of Kurdish peshmerga forces, whose fighters are well aware of their own people’s long, bitter quest for an independent Kurdish homeland. And it’s eyed by Turkey, wary of the growing aspirations of Kurdish nationalists in the region and eager to reassert its own influence in a part of the world that was once under its sway.