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Suit: U.S. Firms’ Bribes Funded Iraq Militia Attacks on Americans
WASHINGTON — A group of American veterans filed a federal lawsuit Tuesday against U.S. and European drug companies and medical device makers, accusing them of supporting an Iran-backed Iraqi militia that killed and wounded hundreds of Americans.
The suit is filed under a law that allows Americans injured by terrorism overseas to seek civil damages. The more than 100 plaintiffs include injured U.S. Iraq war veterans and their families. The defendants are either parent companies or subsidiaries of AstraZeneca plc (AZN); Johnson & Johnson (JNJ); Pfizer Inc. (PFE); Roche Holding AG (RHHBY); and the General Electric Company (GE).
The 203-page lawsuit accuses the companies of paying bribes to officials of Iraq’s health ministry that benefited the Mahdi Army, an Iranian-backed militia that the suit says worked closely with Hezbollah, a Lebanese group that has been designated a terrorist organization by the U.S. government.
Iraqi Shiites of the Mahdi Army militia loyal to cleric Moqtada al-Sadr vow to fight ISIS in a show of strength in a military parade on June 21, 2014 in the Sadr City district of Baghdad, Iraq.Scott Peterson / Getty Images file
The companies sold Iraq’s government-run healthcare system millions of dollars worth of drugs and medical devices, and paid the bribes, the suit alleges, as a cost of doing business.
Related reading: By late 2006, at the height of sectarian violence, the Sadrists were a formidable military force. In the wake of the February 2006 bombing of the al-Askari Mosque in Samarra (one of the holiest Shi’a shrines) and frequent attacks by al Qaeda in Iraq, JAM positioned itself as a security guarantor for the Shi’a. However, the organization also spawned death squads responsible for sectarian cleansing.9 By mid-2006 these militias were engaged in a violent campaign of expansion into Sunni and mixed Sunni-Shi’a neighborhoods. JAM soon controlled large areas of Baghdad and they increasingly relied upon corruption, intimidation, and extortion to enhance their wealth and power. More here.
After the U.S. invasion, Iraq’s political factions divvied up government departments under a political spoils system, and the Mahdi Army’s political wing took control of the health ministry. The state-owned drug purchasing monopoly, Kimadia, demanded a 20 percent “religious tax” from the vendors on every contract, the lawsuit said.
“That policy required, as a general matter, companies doing business with Kimadia to pay commissions of at least 20 percent on every contract, the lawsuit says. “This was sometimes paid in the form of in-kind bribes but was often paid in cash as well. Such cash payments were typically called ‘commissions’ — the Iraqi euphemism for bribes. From 2004-2013, it was standard practice for companies dealing with (the Ministry of Health) to pay ‘commissions’ on every major sales contract.”
The in-kind bribes were in the form of what were known as “free goods,” including drugs and medical devices, that Iraqi officials would sell on the black market, says the lawsuit, which specifically accuses each defendant of paying such bribes.
The suit says the defendants paid the bribes even though they knew or should have known that the money was going to a dangerous armed faction.
Iraqi Shiite cleric Moqtada al-Sadr delivers a speech to his supporters following Friday prayers at the grand mosque of Kufa in the holy city of Najaf, on April 3, 2015.Haidar Hamdani / AFP/Getty Images file
“Defendants knew or recklessly disregarded that their transactions helped fund Jaysh al-Mahdi attacks on Americans,” the suit says, using an Arabic term for the Mahdi Army.
In a statement, Pfizer said it “categorically denies any wrongdoing.” Roche said it had not been served with the suit and could not comment. A GE spokesperson said the company became aware of the complaint Tuesday and is “thoroughly reviewing the allegations.” The other companies did not immediately respond to requests for comment.
The Mahdi Army, led by Muqtada al-Sadr, is an Iranian-backed militia that opposed the American invasion and occupation of Iraq. It was never designated a terrorist organization by the U.S., a fact that could pose a legal hurdle for the plaintiffs. The suit argues that it acted as a terrorist organization and worked closely with Hezbollah, a designated terrorist organization.
Sadr posed a problem for the American war effort from the start, when he allegedly stabbed to death a U.S.-backed political opponent in 2003. American authorities issued a warrant for his arrest on murder charges but never executed it, fearful of the backlash it might cause among his Shiite supporters.
The U.S. thrice contemplated operations to kill Sadr but decided against doing so, a former CIA officer with personal knowledge told NBC News.
Sadr and his militia fought on and off for years against U.S. forces. In 2004, after the U.S. closed his newspaper, his forces seized control of Shiite areas around Iraq, leading to fighting that killed at least 19 Americans.
The lawsuit cites media and government reports asserting that the Mahdi Army worked closely with Hezbollah to attack American forces, including with sophisticated Iranian-build roadside bombs that penetrated U.S. armor.
Those bombs, known as explosively formed penetrators, or EFPs, killed 196 Americans and wounded 861 from 2005 to 2011, according to a U.S. military study cited in the lawsuit.
The suit was brought by the Washington, D.C.-based law firms of Sparacino & Andreson PLLC and Kellogg, Hansen, Todd, Figel & Frederick, PLLC.
One of the plaintiffs’ lawyers, David C. Frederick, represented NFL players in their suit against the NFL over brain injuries. That case resulted in a $765 million settlement fund for players.
Some of the defendants have been accused in the past of violating the U/S. law against bribing foreigners to secure business.
In 2010, GE paid $23.4 million to the federal government to settle allegations by the Securities and Exchange Commission that its subsidiaries had violated the Foreign Corrupt Practices Act in connection with alleged kickbacks paid in Iraq under the United Nations’ oil-for-food program. The GE subsidiaries were selling medical and water purification equipment to the Iraqi government.
The kickbacks were paid from 2000 to 2003 and consisted of cash, computer equipment, medical supplies, and services to the Iraqi Health Ministry or the Oil Ministry, the government said at the time.
In 2011, Johnson & Johnson agreed to pay a $21.4 million penalty to resolve criminal FCPA charges with the Justice Department, and another $48.6 million in disgorgement and prejudgment interest to settle the SEC’s civil charges, in a case alleging improper payments to doctors in Greece by J&J subsidiary DePuy Inc.
Last year, AstraZeneca PLC agreed to pay more than $5 million in penalties after the SEC accused it of violating the books and records and internal controls provisions of the Foreign Corrupt Practices Act in connection with allegedly illegal payments made by subsidiaries in China and Russia to boost drug sales. AstraZeneca settled the enforcement action without admitting or denying the SEC’s findings.
Based on where Congress takes this JCPOA with action and or clarity. the Iranian Supreme leader is turning once again to European leaders as he threatens to perhaps even shred it.
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ANKARA (Reuters) – Iranian Supreme Leader Ayatollah Ali Khamenei said on Wednesday Tehran would stick to its 2015 nuclear accord with world powers as long as the other signatories respected it, but would “shred” the deal if Washington pulled out, state TV reported.
Khamenei spoke five days after U.S. President Donald Trump adopted a harsh new approach to Iran by refusing to certify its compliance with the deal, reached under Trump’s predecessor Barack Obama, and saying he might ultimately terminate it.
“I don’t want to waste my time on answering the rants and whoppers of the brute (U.S.) president,” Khamenei said in a speech to students in Tehran quoted by state television.
“Trump’s stupidity should not distract us from America’s deceitfulness … If the U.S. tears up the deal, we will shred it … Everyone should know that once again America will receive a slap in its mouth and will be defeated by Iranians.”
Trump’s move put Washington at odds with other parties to the accord – Britain, France, Germany, Russia, China and the European Union – who say Washington cannot unilaterally cancel an international accord enshrined by a U.N. resolution.
Khamenei, who has the final say on Iran’s state matters, welcomed European support but said it was not sufficient.
“European states stressed their backing for the deal and condemned Trump … We welcomed this, but it is not enough to ask Trump not to rip up the agreement. Europe needs to stand against practical measures (taken) by America.”
Under the deal, Iran agreed to curb its disputed uranium enrichment program in return for relief from international sanctions that crippled its economy, and U.N. nuclear inspectors have repeatedly certified Tehran’s compliance with the terms.
Trump accuses Iran of supporting terrorism and says the 2015 deal does not do enough to block its path to acquiring nuclear weapons. Iran says it does not seek nuclear arms and in turn blames the growth of militant groups such as Islamic State on the policies of the United States and its regional allies.
In decertifying the nuclear deal last week, Trump gave the U.S. Congress 60 days to decide whether to reimpose economic sanctions on Tehran that were lifted under the pact.
“DO NOT INTERFERE”
In a major shift in U.S. policy, Trump also said Washington will take a more confrontational approach to Iran over its ballistic missile program and its support for extremist groups in the Middle East.
Tehran has repeatedly pledged to continue what it calls a defensive missile capability in defiance of Western criticism. The United States has said Iran’s stance violates the 2015 deal in spirit as missiles could be tipped with nuclear weapons.
Tehran has said it seeks only civilian nuclear energy from its enrichment of uranium, and that the program has nothing to do with missile development efforts.
EU foreign ministers on Monday urged U.S. lawmakers not to reimpose sanctions on Tehran but also discussed Iran’s missile program, which they want to see dismantled.
“They must avoid interfering in our defense program … We do not accept that Europe sings along with America’s bullying and its unreasonable demands,” Khamenei said.
“They (Europeans) ask why does Iran have missiles? Why do you have missiles yourselves? Why do you have nuclear weapons?”
The Trump administration has imposed new unilateral sanctions targeting Iran’s missile activity. It has called on Tehran not to develop missiles capable of delivering nuclear bombs. Iran says it has no such plans.
MI5 Director General (DG) Andrew Parker addressed an audience in Central London today, in which he spoke about the international counter terrorism threat that we are facing and how MI5 works with partners to tackle it. This marks the first time that a DG has given a speech on-camera.
MI5 also continues to counter threats from terrorism in Northern Ireland and the actions of hostile states seeking to carry out damaging espionage activity.
Mr Parker said MI5 remains a multi-dimensional organisation that is constantly evolving and continues to be innovative in order to meet the changing threat.
He added:
Day in and day out we are identifying and disrupting threats: stopping terrorism. Our response is unrelenting. Those that wish our country harm can expect to meet MI5 and the police. And they will face the full force of the law and be brought to justice.
We face this new order of challenge from a position of strength. The UK has world-class intelligence agencies and counter terrorism policing. We are developing, growing and sharpening our capabilities all the time.
Throughout our history MI5 has been all about innovating to meet the changing threat and the shifting technological environment. We review every major operation and learn from our successes. And when an attack happens we are determined, using the harsh light of hindsight, to squeeze out every last drop of learning so that we can be the very best we can be, now and in the future.
…the challenge that we face is undoubtedly a stark one. More threat, coming at us more quickly, and sometimes harder to detect. But it is a challenge that we and our partners are rising to and are facing down. We are committed to this for the long haul. Our unrelenting focus will remain on doing everything in our power every day to keep Britain safe.
Andrew Parker, director general of the security service, gave a rare public speech, calling the threat “multi-dimensional, evolving rapidly and operating at a scale and pace we’ve not seen before”.
Another 20 terrorist attacks on the UK were foiled over the past four years and “many more” were prevented, he said.
The intelligence chief said there has been a “dramatic upshift” this year, which resulted in the London and Manchester attacks which killed a total of 36 people. He said continental Europe has faced a similar surge, particularly in France, Belgium, Germany and Spain.
Mr Parker said MI5 has more than 500 live investigations involving roughly 3,000 people known to be involved in extremist activities.
In addition, he said, more than 20,000 individuals have been scrutinized in the past for possible terror ties and there are undoubtedly “violent extremists” who have thus far not been detected by the Security Service.
The director called on technology companies to work with the government on preventing their social media platforms from being used by extremists for communications that cannot be monitored.
When asked if Facebook and Google were doing enough on this front, Mr Parker declined to discuss specific companies.
He praised advancements in communications technology, but said an “unintended side effect” has been to make it easier for extremists to avoid legal monitoring by using apps, including many that provide encryption, to avoid detection. He said companies should to more to prevent this abuse of their communications systems. More here
A recent cyber-heist that targeted a bank in Taiwan has been linked by security researchers to an infamous threat group believed to be operating out of North Korea.
Hackers exploited the SWIFT global financial network to steal roughly $60 million from Taiwan’s Far Eastern International Bank. The money was transferred to several countries, but bank officials claimed they had managed to recover most of it. Two individuals were arrested earlier this month in Sri Lanka for their role in the operation.
Researchers at BAE Systems have identified some of the tools used in the attack and found connections to the North Korean threat actor known as Lazarus. This group is also believed to be behind the 2014 attack on Sony Pictures and campaigns targeting several banks, including Bangladesh’s central bank.
The attack on the Bangladesh bank, which resulted in the theft of $81 million, also involved the SWIFT system. Similar methods were also used to target several other banks, but SWIFT said some of the operations failed due to the new security measures implemented by the company.
While it’s still unclear how attackers gained access to the systems of Far Eastern International Bank, an analysis of various malware samples apparently involved in the attack suggests that the hackers may have used a piece of ransomware as a distraction.
The ransomware involved in the attack is known as Hermes. According to Bleeping Computer, the threat surfaced in February and its latest version has an encryption mechanism that makes it impossible to recover files without paying the ransom.
However, researchers at McAfee discovered that the Hermes variant used in the attack on the Taiwanese bank did not display a ransom note, which led them to believe it may have been only a distraction.
“Was the ransomware used to distract the real purpose of this attack? We strongly believe so,” McAfee researchers said. “Based on our sources, the ransomware attack started in the network when the unauthorized payments were being sent.”
BAE Systems has seen samples that drop a ransom note in each encrypted folder, but even they believe Hermes may have been used to distract the bank’s security team.
Another malware sample linked by BAE Systems to this attack is a loader named Bitsran, which spreads a malicious payload on the targeted network. This threat contained what appeared to be hardcoded credentials for Far Eastern International’s network, which suggests the threat group may have conducted previous reconnaissance.
Some pieces of malware discovered by BAE Systems are known to have been used by the Lazarus group, including in attacks aimed at financial organizations in Poland and Mexico. The malware includes commands and other messages written in Russia, which experts believe is likely a false flag designed to throw off investigators.
It’s worth noting that the Hermes ransomware samples checked the infected machine’s language settings and stopped running if Russian, Ukrainian or Belarusian was detected. This is common for malware created by Russian and Ukrainian hackers who often avoid targeting their own country’s citizens. However, this could also be a false flag.
Another piece of evidence linking the Taiwan bank attacks to Lazarus is the fact that money was transferred to accounts in Sri Lanka and Cambodia, similar to other operations attributed to the group.
Some experts believe that these bank heists and the WannaCry attack, which has also been linked by some to Lazarus, are campaigns launched by North Korea for financial gain. However, many of these operations don’t appear to have been very successful on this front.
“Despite their continued success in getting onto payment systems in banks, the Lazarus group still struggle getting the cash in the end, with payments being reversed soon after the attacks are uncovered,” BAE Systems researchers explained.
“The group may be trying new tricks to disrupt victims and delay their ability to respond – such as different message formats, and the deployment of ransomware across the victim’s network as a smokescreen for their other activity. It’s likely they’ll continue their heist attempts against banks in the coming months and we expect they will evolve their modus operandi to incorporate new ways of disrupting victims (and possibly the wider community) from responding,” they added.
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*** Related reading: The Lazarus (aka DarkSeoul group) is allegedly controlled by Bureau 121, a division of the Reconnaissance General Bureau, a North Korean intelligence agency. Bureau 121 is responsible for conducting military cyber campaigns.
*** By the way, some of the North Korean hackers not only operate in China but many of those hackers are from India….
6,000 is the number of hackers working for North Korea, traced by American and British security officials.
Once scoffed at, North Korea’s cyber technology has now developed to a brink where it can create a havoc in the world’s cybersecurity. From theft to political agenda, North Korea now launches attacks in the form of ransomware, digital bank heists, online video game cracks and Bitcoin exchanges.
In the first week of October, India’s Ministry of External Affairs issued a strongly-worded statement condemning North Korea for conducting a powerful nuclear test. Few weeks down the line, a stunning report from the New York Times claims that India serves as a base for North Korea’s cyber warfare.
Citing a report by the Recorded Future, the American publication said nearly a fifth of the Pyongang’s attacks originate from India.
The report claims that most of North Korean cyber operations are carried out from foreign countries like India, Malaysia, New Zealand, Nepal, Kenya, Mozambique, and Indonesia. While in some cases, the North Korean hackers route their attacks through their computers from abroad, in cases like that in India, hackers are physically stationed to carry out attacks.
The cyber mission as envisaged by Kim Jong-il in the 1990s was expanded by his dictator son Kim Jong-Un after he took power in 2011.
On of the most successful cyber attacks carried out by North Korea dates back to 2014 on Sony pictures to prevent them from releasing a comedy film that was based on the assassination of Kim Jong Un.
Last May, a widespread global ransomware attack caused panic and briefly stalled the Britain’s National Health Services.
The digital bank heists in Philippines in 2015 and in Vietnam in the same year also earned them some hard cash from cyber attacks.
The report by Recorded Future also indicates that India, despite serving as a base for North Korea’s cyberwar, also remains at a potential threat from similar attacks. While the world lives under the fear of North Korea emerging as a nuclear superpower, the country is silently building a strong brigade of hackers.
Russian journalists publish massive investigation into St. Petersburg troll factory’s U.S. operations
A day after Dozhd television published an interview with a former member of Russia’s infamous Internet Research Agency, the magazine RBC released a new detailed report on the same organization’s efforts to meddle in U.S. domestic politics. Meduza summarizes RBC’s new report here.
The Internet Research Agency, Russia’s infamous “troll farm,” reportedly devoted up to a third of its entire staff to meddling in U.S. politics during the 2016 presidential election. At the peak of the campaign, as many as 90 people were working for the IRA’s U.S. desk, sources told RBC, revealing that the entire agency employs upwards of 250 people. Salaries for staff working in the U.S. department apparently range from 80,000 to 120,000 rubles ($1,400 to $2,100) per month.
The head of the IRA’s U.S. desk is apparently a man originally from Azerbaijan named Dzheikhun Aslanov (though he denies any involvement with the troll factory).
In August and September this year, Facebook, Instagram, and Twitter suspended 118 communities and accounts run by the St. Petersburg “troll factory,” disabling a network capable of reaching 6 million subscribers. In 2016, at the height of the U.S. presidential campaign, this network reportedly produced content that reached 30 million people each week.
A source also told RBC that the Internet Research Agency spent almost $80,000 over two years, hiring roughly 100 local American activists to stage about 40 rallies in different cities across the United States. The activists were hired over the Internet, communicating in English, without their knowledge that they were accepting money or organizing support from a Russian organization. According to RBC, internal records from the IRA verify its role in these activities.
The main activity in the troll factory’s U.S. desk was to incite racial animosity (playing both sides of the issue), and promoting the secession of Texas, objections to illegal immigration, and gun rights.
RBC estimates that the Internet Research Agency’s total salary expenses approach $1 million per year, with another $200,000 allocated to buying ads on social media and hiring local activists in the U.S.
According to RBC, the IRA still has a U.S. desk, though its staff has apparently dropped to 50 employees.
Note: Formally, the Internet Research Agency ceased to exist roughly two years ago, rebranding itself under different names, but sources say the organization continues to operate as before.
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One part of the factory had a particularly intriguing name and mission: a “Department of Provocations” dedicated to sowing fake news and social divisions in the West, according to internal company documents obtained by CNN.
Prigozhin is one of the Kremlin’s inner circle. His company is believed to be a main backer of the St. Petersburg-based “Internet Research Agency” (IRA), a secretive technology firm, according to US officials and the documents reviewed by CNN. Prigozhin was sanctioned by the US Treasury Department in December of 2016 for providing financial support for Russia’s military occupation of Ukraine. Two of his companies, including his catering business, were also sanctioned by Treasury this year.
CNN has examined scores of documents leaked from Prigozhin’s companies that show further evidence of his links to the troll factory.
One contract provided IRA with ways to monitor social media and a “system of automized promotion in search engines.”
Prigozhin has a colorful past. He spent nine years in prison in the 1980s for fraud and robbery, according to Russian media reports. After his release, he went into the catering business — renovating a boat and opening New Island, one of a half-dozen upscale restaurants he owns in St. Petersburg. Putin turned to him to cater his birthday parties as well as dinners with visiting leaders, including President Bush and Jacques Chirac of France. A headline in The Moscow Times referred to Prigozhin as Putin’s “Personal Chef.”
Prigozhin subsequently won lucrative catering contracts for schools and Russia’s armed forces. He escorted Putin around his new food-processing factory in 2010. By then he was very much a Kremlin insider with a growing commercial empire. More here.
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Trolling NATO? Yuppers
Seventy percent of Russian-language tweets targeting NATO military activities in Eastern Europe are generated by automated Russian trolls, according to a survey done by the military alliance.
“Two in three Twitter users who write in Russian about the NATO presence in Eastern Europe are robotic or ‘bot’ accounts,” the NATO Strategic Communications Centre of Excellence stated in a report made public this week.
The Russian bots sent 84 percent of all Russian language messages. English language tweets against the alliance also were found to be automated, with some 46 percent generated by automated Twitter accounts.
The report criticized the global social media platform for not doing enough to counter Russian bot activities on Twitter. “Our impression is that Twitter in Russian is policed less effectively than it is in English,” the report said.
A Twitter spokesman could not be reached for comment. Colin Crowell, Twitter’s vice president for public policy, stated in a recent post on the company website that “we strictly prohibit the use of bots and other networks of manipulation to undermine the core functionality of our service.” Read more here.
Iraqi Shiites of the Mahdi Army militia loyal to cleric Moqtada al-Sadr vow to fight ISIS in a show of strength in a military parade on June 21, 2014 in the Sadr City district of Baghdad, Iraq.Scott Peterson / Getty Images file
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