Category Archives: Treasury

JASTA Sees its First Lawsuit, this one Against Iran

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Post reporter Jason Rezaian and his family file federal lawsuit against Iranian government

Washington Post reporter Jason Rezaian and his family filed a federal lawsuit Monday against the Iranian government, claiming he was taken hostage and psychologically tortured during his 18 months in prison in an effort by Tehran to influence negotiations for a nuclear agreement with Iran.

Related reading: JASTA, Saudi Arabia

The suit, filed in U.S. District Court in the District of Columbia, says Rezaian was targeted for arrest to gain advantage in a prisoner exchange and to “extort” concessions from the U.S. government in the multinational talks over lifting sanctions if Iran agreed to limits on its nuclear program.

[Read the full lawsuit filed by the Rezaian family]

Iranian officials repeatedly told Rezaian and his wife, Yeganeh Salehi, who also was detained for more than two months, that Rezaian had “value” as a bargaining chip for a prisoner swap, the suit says. The filing also links key moments in the nuclear negotiations to Rezaian’s treatment in the judicial system, from arrest to conviction to sentencing, and ultimately his release on the day the deal was implemented. “For nearly eighteen months, Iran held and terrorized Jason for the purpose of gaining negotiating leverage and ultimately exchanging him with the United States for something of value to Iran,” the suit states.

Rezaian, his brother, Ali Rezaian, and their mother, Mary Rezaian, are asking for an unspecified sum for damages under the “terrorism exception” to the Foreign Sovereign Immunities Act. That law generally bars U.S. citizens from suing foreign governments in domestic courts, but exceptions are made for terrorist acts, torture or hostage-taking by countries — including Iran — that the State Department has designated as state sponsors of terrorism. The suit accuses Iran of all three.

[Plane leaves Iran with Post reporter, other Americans, in prisoner swap]

Rezaian and Salehi, who was born in Iran and married Rezaian there, were arrested on July 22, 2014, by Iranian agents wearing surgical masks who forced their way into their apartment and took them for questioning at Evin Prison, a notorious site for political prisoners. Salehi was freed 71 days later on a $32,000 bail provided by her brother-in-law, Ali.

Rezaian was eventually tried and convicted of espionage and related charges, according to Iranian state media accounts. But the Iranian government has never officially disclosed the specifics of his conviction in a closed-door trial, or the sentence imposed by a judge known for meting out harsh punishments.

The lawsuit provides details of Rezaian’s incarceration that have never been publicly revealed before.

Both Rezaian and Salehi were repeatedly subjected to psychological and physical abuse during lengthy interrogations, the suit says. Their captors at turns threatened to dismember or execute them. Interrogated in isolation and often deprived of sleep, each also was warned that the other might be maimed or executed, and the same fate could befall other family members in Iran, according to the filing.

[Detention takes ‘devastating toll’ on Post reporter locked up in Iran]

The ordeal was so intense that Rezaian, Salehi and Rezaian’s brother, Ali, all contemplated suicide, the suit says. Now — almost nine months after Rezaian and four other U.S. citizens were released on the day the nuclear deal was implemented—Salehi, the Rezaian brothers and their mother are still afflicted with trauma and guilt, according to the suit.

“For 544 days, Jason suffered such physical mistreatment and severe psychological abuse in Evin Prison that he will never be the same,” the suit states. “He will require specialized medical and other treatment for the rest of his life.”

Salehi is not a plaintiff in the suit. Nor is The Washington Post. Rezaian is currently on leave from The Post for a year as a Nieman fellow at Harvard University.

“Iran’s unconscionable actions have inflicted deep and lasting wounds on The Washington Post’s Jason Rezaian and his family,” said Executive Editor Martin Baron, who during the reporter’s imprisonment often criticized what he called Iran’s “system of injustice.”

“This legal filing is a stark telling of Iran’s brutal and heartless treatment of an innocent journalist and his wife, and the impact on those who love him. While this legal action is being taken solely by Jason and his family, The Post continues to support the Rezaians through their long and painful recovery.’’

The Rezaian lawsuit is the latest attempt by Americans to have the U.S. justice system provide compensation for harms inflicted by the Iranian government — in particular, by the powerful and hard-line Islamic Revolutionary Guard Corps that fiercely opposed the nuclear deal and has tried to thwart many initiatives of President Hassan Rouhani, a relative pragmatist. The IRGC is named as a co-defendant in the suit.

“This was really one of the few ways they felt they could try to hold Iran publicly accountable,” said David Bowker, Rezaian’s attorney. “Ideally, it will deter this kind of behavior toward other innocent people.”

Rezaian and his family declined to discuss the case, deferring questions to their lawyer.

In a number of suits brought against it over the years, Iran has not responded, resulting in default judgments.

Congress and U.S. courts have provided a legal framework for Americans to sue Iran and be compensated. The State Department has labeled Iran the top state sponsor of terrorism in the world. Also on the list are Sudan and Syria.

In April, the U.S. Supreme Court upheld a law allowing American victims of terrorism and their families to collect almost $2 billion in seized Iranian assets. The case involved relatives of people killed or injured in the 1983 bombing of the U.S. Marine Corps barracks in Beirut. Iran labeled the decision “confiscation” and “theft.”

The closest precedent to Rezaian’s case involves Nik Moradi, an Iranian American who was seized during a family visit in 2007 and accused of spying for the United States. More than six months before his release on bail, he said he was subjected to physical and mental torture during interrogations. In 2013, Moradi and his wife sued Iran in U.S. federal court under the Foreign Sovereign Immunities Act. The couple was awarded $20 million in a default judgment after Iran failed to respond.

One possible venue for securing payment on a judgment is the Victims of State Sponsors of Terrorism Fund, created last year by Congress to compensate the Americans held hostage in Iran during the takeover of the U.S. Embassy in Tehran after the 1979 revolution. It also set aside money for victims with court judgments against state sponsors of terrorism, funded by money from a civil penalty paid by BNP Paribas bank for violating sanctions against Iran, Cuba and Sudan.

The lawsuit provides dark glimpses of Rezaian’s 50 days in solitary in a small, dank, cockroach-infested cell. Anxiety and depression made him hallucinate, as he perceived the walls moving and talking. The cell was constantly lit, and a noisy fan prevented sleep. He slept on the floor, and prison officials eventually gave him tranquilizers to induce sleep. His food sometimes had concrete, rocks, dirt and other inedible objects mixed in.

“During his time in solitary confinement, Jason believed he was losing his mind,” the suit says.

In the initial months of his imprisonment, Rezaian was taken blindfolded several times a day to an underground room for interrogations that lasted hours. He was forced to write down his answers, which prison officials translated into Farsi before trying to coerce him to sign without explaining the translations.

In an effort to get him to confess to espionage, the suit says, one interrogator threatened him with beheading. Another held out the carrot of a video confession as his only chance for freedom.

“They threatened Jason with physical mutilation, such as cutting off his limbs, and repeatedly told Jason that he would never see Yeganeh alive again,” the suit says.

Though Salehi is not a plaintiff, her agony is clear in the dry legalese.

During her detention, Salehi was blindfolded while interrogators hit the table, broke glass and kicked her chair, startling her. One interrogator threatened to cut off her left leg and right hand or arm. They told her they would throw her husband off a cliff if she did not incriminate him.

By the time she was released, her legs would go numb and she sometimes fainted when sitting down. She had to shear off her hair because it was so matted. She had skin lesions. On her infrequent prison visits to see her husband, she sometimes was made to don a prison uniform and told she might be detained again, the suit says. Convinced her husband would die in Evin Prison, she considered killing herself to draw attention to his plight.

Ali Rezaian, who quit his job to work full-time campaigning for his brother’s release, also grew despondent, according to the suit. Iranian agents tailed him when he went to Geneva to appeal for help from the U.N. Human Rights Council and his mother was held against her will in Iran.

[Jason Rezaian works to reclaim his life after return to the U.S.]

“He contemplated suicide in the fall of 2015, having lost faith that his brother would ever be released,” the suit states. “At the time, Ali believed that only by ending his own life could he prompt action by defendants or others, to free Jason.”

Jason Rezaian now experiences depression, sleeplessness, short-term memory loss and other symptoms associated with post-traumatic stress disorder, the suit says. He grows anxious in large crowds, fears for his family’s safety and has grown more “detached” from them. He sees a psychologist.

“Plaintiffs live in constant fear that Iranian agents are spying on them, plotting additional acts of terrorism and planning ways to hurt them and their family members again,” the suit says.

Ann E. Marimow contributed to this report.

Read more:

Rezaian’s wife and mother recall tortuous final hours in Iran

A triumphant return for Jason Rezaian

Obamacare Proven Fraud and Single Payer

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(Washington, D.C.) – Citizens Against Government Waste (CAGW) expressed exasperation after the Government Accountability Office (GAO) released the final results of its 2015 undercover tests on the Affordable Care Act’s (ACA) fraud prevention capabilities.  Amid naïve proclamations by President Obama that the ACA is “working exactly as it’s supposed to,” the GAO report reveals the sad reality that this law is uniquely prone to fraud and taxpayers have good reasons to worry.

GAO began “secret shopper” investigations in 2014 to test whether or not the federal healthcare exchange (marketplace) and select state marketplaces were able to detect and prevent falsified applications for subsidized health coverage from being accepted.  Those tests found that 11 of 12 fictitious identities received coverage and after a call to the marketplace in 2015, 10 of those 11 were re-enrolled for the following coverage year.

On September 12, 2016, GAO released the final results of its 2015 testing, which covered the federal marketplace and state exchanges in California, Kentucky, and North Dakota.  The results were similarly jarring.

All 10 fictitious identities that applied for taxpayer subsidies were approved, even after eight of the 10 failed the preliminary identity check.  Investigators were able to obtain subsidies after they provided false proof of income, documentation of citizenship, and Social Security numbers that began with zeroes.  The federal exchange made no effort to validate that information.  GAO also created fake applicants for Medicaid coverage, and the results were not much better:  seven of the eight fictitious applicants were approved for subsidized coverage.

Perhaps the most distressing revelation in this report is the following admission from federal and state marketplace officials:  “The marketplace or Medicaid offices only inspect for supporting documentation that has obviously been altered.  Thus, if the documentation submitted does not show such signs, it would not be questioned for authenticity.”

CAGW President Tom Schatz said, “The Congressional Budget Office estimates that subsidized health coverage through Obamacare will cost taxpayers $866 billion over the next ten years.  The fact that there is still no reliable system in place to prevent rampant fraud is a bad omen for taxpayers.  This damning report provides further justification for this flawed law to be completely overhauled and replaced.”

Citizens Against Government Waste is a nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government.

**** Heading to Single Payer:

In part from The Hill:

The McKinsey Center for U.S. Health System Reform, which studies the ACA and its implications, showed in an Aug. 18 analysis that the percentage of counties in the U.S. with five or more participating insurance carriers remaining in the exchanges will likely shrink from 51 percent in 2016 to 31 percent in 2017, and the number of counties having only one carrier participating will likely grow from 2 percent in 2016 to 17 percent in 2017. Pinal County in Arizona found out in August that it will have no insurance carriers participating in ObamaCare exchanges in 2017.

This massive insurer exodus from Obamacare markets not only creates a shrinking pool of competition and narrower networks, but could also be setting the stage for something far more devastating: the inevitable push for a single-payer or public option to either be added to, or replace, ObamaCare.

In an Aug. 2 Journal of the American Medical Association article, President Obama, despite the overwhelming evidence that heavy-handed government control has not worked to make quality healthcare more affordable, called for adding a public option; more tax dollars to prop up the exchanges; more government bureaucrats and politicians making decisions on how healthcare is delivered to our nation’s citizens; and pharmaceutical price controls, which would destroy research and development and deny patients access to promising new therapies.

One need only to look at the Veterans Administration to understand what a government-run, single-payer healthcare system looks like. Horror stories of long waits for treatment, bureaucratic inertia, fraud, incompetence, cover-ups and politics abound.

Others in favor of a complete government takeover demand “Medicare for all,” also a single-payer system, ignoring the fact that on its current trajectory, the Medicare trust fund will be depleted in 2028, two years earlier than projected in 2015. Only massive tax hikes, budget cuts to other government programs, or more borrowing will save it.

These pro-single payer zealots want to emulate the disastrous single-payer systems adopted in other countries, where program costs exceeded expectations and rose faster than predicted, price controls were enacted, rationing became necessary and higher taxes were imposed to cover ballooning costs. Indeed, they are pushing hard for the United States to replicate these failed policies on an even grander scale.

They are ignoring the results so far of ObamaCare: numerous co-op failures costing billions of dollars, skyrocketing premiums and crippling deductibles across the country. With a slew of insurers exiting the ObamaCare exchanges, the nation’s healthcare system is now even more perplexing and costly.

With about two months left until the presidential election, it is time to start thinking critically about healthcare and why moving toward a propped-up ObamaCare or adopting a single-payer approach are not the answers to fixing the country’s broken healthcare system.

Creating an environment where a true market-based system can flourish and in which the purchasing power and healthcare decision-making stands with consumers, not with Washington politicians and bureaucrats, is the way to go.

Schatz is president of Citizens Against Government Waste.

 

US lifted Sanctions on Iran Banks as Part of Prisoner Release

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The White House published document on the Iran deal including those alleged ‘snapback’ sanctions, which will never happen. Given the huge infusion of cash into Iran, their economy and infrastructure will become more harden to any actions or damage future sanctions as is the objective, including snapback sanctions.

U.S. Signed Secret Document to Lift U.N. Sanctions on Iranian Banks

Administration backed measures on the same day Tehran released four American citizens from prison

WSJ: WASHINGTON—The Obama administration agreed to back the lifting of United Nations sanctions on two Iranian state banks blacklisted for financing Iran’s ballistic-missile program on the same day in January that Tehran released four American citizens from prison, according to U.S. officials and congressional staff briefed on the deliberations.

The U.N. sanctions on the two banks weren’t initially to be lifted until 2023, under a landmark nuclear agreement between Iran and world powers that went into effect on Jan. 16.

The U.N. Security Council’s delisting of the two banks, Bank Sepah and Bank Sepah International, was part of a package of tightly scripted agreements—the others were a controversial prisoner swap and transfer of $1.7 billion in cash to Iran—that were finalized between the U.S. and Iran on Jan. 17, the day the Americans were freed.

Brett McGurk, a senior State Department official, signed three documents with a representative of the Iranian government in Geneva on the morning of Jan. 17 that set out commitments for a prisoner swap, a cash transfer to Iran and the delisting of sanctions on two Iranian banks, according to senior U.S. officials.  Brett McGurk, a senior State Department official, signed three documents with a representative of the Iranian government in Geneva on the morning of Jan. 17 that set out commitments for a prisoner swap, a cash transfer to Iran and the delisting of sanctions on two Iranian banks, according to senior U.S. officials. Photo: mandel ngan/Agence France-Presse/Getty Images

The new details of the delisting have emerged after administration officials briefed lawmakers earlier this month on the U.S. decision.

According to senior U.S. officials, a senior State Department official, Brett McGurk, and a representative of the Iranian government signed three documents in Geneva on the morning of Jan. 17.

One document committed the U.S. to dropping criminal charges against 21 Iranian nationals, and Tehran to releasing the Americans imprisoned in Iran.

Another committed the U.S. to immediately transfer $400 million in cash to the Iranian regime and arrange the delivery within weeks of two subsequent cash payments totaling $1.3 billion to settle a decades-old legal dispute over a failed arms deal.

The U.S. agreed in a third document to support the immediate delisting of the two Iranian banks, according to senior U.S. officials. In the hours after the documents were signed at a Swiss hotel, the different elements of the agreement went forward: The Americans were released, Iran took possession of the $400 million in cash, and the U.N. Security Council removed sanctions on Bank Sepah and Bank Sepah International, these officials said.

“Lifting the sanctions on Sepah was part of the package,” said a senior U.S. official briefed on the deliberations. “The timing of all this isn’t coincidental. Everything was linked to some degree.”

A documentary published by Tasnim News Agency, an Iranian media outlet affiliated with the elite Islamic Revolutionary Guard Corps, claimed in February that Iranian government officials had demanded that Sepah be taken off the sanctions list as part of a deal to release the prisoners.

The Obama administration, under the nuclear deal reached in July 2015, agreed to lift Treasury Department sanctions on Bank Sepah, but U.N. penalties were to remain in place for eight years.

But after the nuclear deal was forged, U.S. officials said, there was a continued dialogue with Iran about the status of the two banks before the deal went into effect in January.

Tehran argued that the banks were critical to the country’s economy and international trade. Bank Sepah is Iran’s oldest bank and one of its three largest in terms of assets. Bank Sepah International, based in London, was key to financing Iran’s international trade before sanctions were imposed.

U.S. officials said there was a desire in Washington to harmonize the U.N. sanctions list with the U.S.’s. And they said Washington believed Iran had earned more sanctions relief because Tehran had been implementing the terms of the nuclear agreement, which called for a major scaling back of its infrastructure and production of nuclear fuel.

“The issue of Bank Sepah has been one of many topics we discussed with Iran in our overall diplomatic discussions,” said a second senior administration official briefed on the deliberations.

Another senior administration official said lifting sanctions on Bank Sepah and its London affiliate was in the spirit of the commitment by the U.S. and other world powers to provide Iran with sanctions relief.

Administration critics and some congressional officials said they believed the move broke the commitments the administration made to Congress about the deal.

The Obama administration had told Congress that under the deal the U.S. would lift sanctions only on companies and individuals tied to Iran’s nuclear development. Sanctions on those involved in missile development were to remain in place, these critics said.

The Obama administration has repeatedly said it is committed to rolling back Iran’s ballistic missile program.

“By agreeing to remove U.N. and EU sanctions eight years early on Iran’s main missile financing bank, the administration effectively greenlighted their nuclear warhead-capable ballistic missile program,” said Mark Dubowitz, a top critic of the Iran nuclear deal at the Foundation for Defense of Democracies, a Washington think tank.

The U.S. Treasury Department sanctioned Bank Sepah, Bank Sepah International and its then-chairman in 2007 for their alleged role in backing Iran’s missile program. The designation didn’t mention what direct role the entities allegedly played in helping Iran’s nuclear program.

At the time, the Treasury said that Bank Sepah and Bank Sepah International had provided financial support to Iranian-state owned companies and organizations developing Iran’s missile program. These included Iran’s Aerospace Industries Organization and the Shahid Hemmat Industries Group.

“Bank Sepah is the financial linchpin of Iran’s missile procurement network and has actively assisted Iran’s pursuit of missiles capable of carrying weapons of mass destruction,” the Treasury said in a January 2007 statement.

Iran has conducted up to 10 ballistic missile tests since the forging of the nuclear agreement in July 2015. The U.N. Security Council has condemned Tehran’s actions but hasn’t moved to impose any new sanctions on the country.In March, the Treasury Department imposed sanctions on two Iranian companies it said were working with Shahid Hemmat Industries.

U.S. officials said the Obama administration closely vetted the activities of all individuals and entities tied to Bank Sepah before supporting the lifting of U.S. and U.N. sanctions.

“We have the ability to quickly reimpose U.S. sanctions if Bank Sepah or any other entity engages in activities that remain sanctionable,” said the second senior U.S. official.

The Obama administration’s decision to send such large amounts of cash to Iran has fueled charges in Congress that the White House paid ransom to Tehran to secure the release of the American prisoners. The White House has repeatedly denied the charge, saying the $1.7 billion settlement saved the U.S. as much as $8 billion that it could have owed Iran if it lost, as was expected, a court proceeding that was taking place in The Hague, Netherlands. The administration has said the cash was used as “leverage” to make sure the American prisoners were released.

The dispute in Washington has only deepened in recent weeks, as senior Pentagon officials, including Secretary of Defense Ash Carter, told Congress in a hearing that they weren’t notified by the White House about the cash transfer. The chairman of the Joints Chief of Staff, Marine Gen. Joe Dunford, said at a hearing last week that he found it “troubling” that the U.S. provided Tehran with so much cash, which he argued could be used for “spreading malign influence.”

Immigrants Buying Entry into U.S., are Some Terrorists?

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…..even if they are corrupt and the money used has been laundered or financed by a terror organization…

Primer:

CIA Director: We ‘have to assume’ terrorist activity in US

‘Impossible to say’ if ISIS has cells here

(CNN) – The director of the CIA said Wednesday despite the government’s best efforts, the likelihood of terrorist activity in the United States is strong.

“So I think we have to assume there’s something here in the states,” said John Brennan, in an interview for CNN’s “Erin Burnett OutFront” that aired Wednesday night. “We have to be relentless in terms of going after them.”

Brennan, who was appointed to lead the CIA shortly before President Barack Obama’s second term, said “it’s impossible to say” whether ISIS has operatives or cells in the United States, and he credited the “tremendous advances in information sharing and interaction between federal officials” in making it difficult for terrorists to operate in the country.

He said he is confident that the US will be “able to remove other senior members” of ISIS, including the organization’s leader Abu Bakr al-Baghdadi.

“His time is limited,” Brennan said of al-Baghdadi. “It’s just a question of whether or not he is going to be removed this week, this month, next month or in the coming months.”

But still, Brennan said “you cannot assume there’s nobody in the homeland.”

“What you need to do is to be able to continue to uncover and use intelligence, what they might be doing here,” he said. More details here.

Immigrant Investor Program:

Progress Made to Detect and Prevent Fraud, but Additional Actions Could Further Agency Efforts

What GAO Found   Full report here.

Inspector General Report is here.

The Department of Homeland Security’s U.S. Citizenship and Immigration Services (USCIS) has recently taken steps intended to enhance fraud detection and mitigation activities for the Employment-Based Fifth Preference Immigrant Investor Program (EB-5 Program) and address previous GAO recommendations.

This includes actions such as conducting and planning additional risk assessments to gather additional information on potential fraud risks to the program. For example, USCIS is leveraging overseas staff to investigate potential fraud associated with unlawful sources of immigrant investor funds and is conducting a site visit pilot to help assess the potential risks of fraud among EB-5 program investments. USCIS is also taking steps to collect more information about EB-5 program investments and immigrant investors through new, revised forms and expanding its use of background checks, among other things, to help improve its ability to identify specific incidence of fraud. However, fraud mitigation in the EB-5 Program is hindered by a reliance on voluminous paper files, which limit the agency’s ability to collect and analyze program information. In its review of a nongeneralizable selection of files associated with EB-5 program regional centers and immigrant investors, GAO found that identifying fraud indicators is extremely challenging. For example, many of these files were several thousand pages long and would take significant time to review. According to USCIS documentation, the program anticipates receiving approximately 14 million pages of supporting documentation from its regional-center applicants and immigrant investor petitioners annually. Recognizing these limitations, USCIS has taken preliminary steps to study digitizing and analyzing the paper files submitted by petitioners and applicants to the program, which could help USCIS better identify fraud indicators in the program; however, these efforts are in the early stages.

USCIS has incorporated selected leading fraud risk management practices into its efforts but could take additional actions to help guide and document its efforts. GAO’s Fraud Risk Framework is a set of leading practices that can serve as a guide for program managers to use when developing efforts to combat fraud in a strategic, risk-based manner. USCIS’s actions align with two key components of the Fraud Risk Framework: (1) commit to combating fraud by creating an organizational culture and structure conducive to fraud risk management such as by providing specialized fraud awareness training; and (2) assess risks by planning and completing regular fraud risk assessments. However, USCIS has not developed a fraud risk profile, an overarching document that guides its fraud management efforts, as called for in the Fraud Risk Framework. Instead, USCIS’s risk assessments, spanning multiple years, were developed as separate documents and reports, and there is not a unifying document that consolidates and systematically prioritizes these findings. Without a fraud risk profile, USCIS may not be well positioned to identify and prioritize fraud risks in the EB-5 Program, ensure the appropriate controls are in place to mitigate fraud risks, and implement other Fraud Risk Framework components.

Why GAO Did This Study

Congress created the EB-5 visa category to promote job creation and capital investment by immigrant investors in exchange for lawful permanent residency and a path to citizenship. Participants must invest either $500,000 or $1 million in a business that is to create at least 10 jobs. Upon meeting program requirements, immigrant investors are eligible for conditional status to live and work in the United States and can apply to remove the conditional basis of lawful permanent residency after 2 years. In August 2015, GAO reported on weaknesses in certain USCIS fraud mitigation activities, and made two related recommendations.

GAO was asked to review actions taken by USCIS to address fraud risks in the EB-5 program since its August 2015 report. This report examines the extent to which USCIS (1) has taken steps to enhance its fraud detection and mitigation efforts; and (2) has incorporated selected leading fraud risk management practices into its efforts. GAO reviewed relevant program documentation and information; selected and reviewed a random, nongeneralizable sample of immigrant investor petitions and regional-center applications submitted between fiscal years 2010 and 2014; and compared USCIS’s actions against GAO’s Fraud Risk Framework.

What GAO Recommends

GAO recommends that USCIS develop a fraud risk profile that aligns with leading practices identified in GAO’s Fraud Risk Framework. The Department of Homeland Security concurred with GAO’s recommendation.

Dept of Treasury, Judgement Fund and Obamacare, Ruh Roh

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That Judgment Fund is the same financial account out of which the United States paid Iran the ransom money of an estimated $1.7 Billion. By the way, the funds in this account are taxpayer dollars and not from other sources. So…..while Obamacare exchanges are going bankrupt, up to 11 so far, the other major health insurers are demanding the White House and Treasury make good on the contracts to pay them what they are owed. Looks as though….it will come out of this ‘judgment fund’ and the taxpayers are fleeced again.

As a matter of fact, the Department of Justice has to approve payments out of the Judgment Fund, with this transmittal form. If you can stand it, this page has many forms, procedures and requirements regarding monies in and out of the Judgment Fund.

Obama administration may use obscure fund to pay billions to ACA insurers

WashingtonPost: The Obama administration is maneuvering to pay billions of dollars the government owes to health insurers under the Affordable Care Act, potentially resorting to an obscure Treasury Department fund intended to cover federal legal claims.

Justice Department officials have told several health plans suing the government over the unpaid money that they are eager to negotiate a broad settlement, which would allow the administration to compensate about 170 other insurers selling coverage in ACA marketplaces, according to insurance executives and lawyers familiar with the talks.

The efforts in recent weeks reflect the partisan thorns that still surround the sprawling law six years after its passage. The payouts probably would be made from the Judgment Fund, a 1950s creation that is allowed as much money as it needs to satisfy valid claims against the government. Such a move would bypass congressional Republicans, who have criticized certain ACA provisions as industry “bailouts” and blocked the Health and Human Services Department from paying health plans what they are owed.

In the waning months of the Obama White House, administration officials are continuing their upbeat portrayal of all aspects of the health-care law, one of President Obama’s main domestic achievements. Behind the scenes, they think that settling these claims — $2.5 billion for 2014 and an as-yet-undisclosed sum for 2015 — is crucial to the exchanges’ well-being at a time when the high cost of covering ACA customers has driven some small insurers out of business and prompted several large ones to defect from marketplaces for the coming year.

“It’s a legacy item for the White House,” said Dan Mendelson, president of the health consulting firm Avalere and an adviser on the payout effort. “It’s more than just a lawsuit. It’s really about the future . . . and stability of these markets.”

Even with a settlement still uncertain, GOP lawmakers are beginning to cry foul. “It’s an end run on the clear . . . intent of Congress,” said Rep. H. Morgan Griffith (Va.).

The money in question involves one of three strategies to help coax insurers into the ACA marketplaces by promising to cushion them from unexpectedly high expenses for their new customers. This particular strategy, known as “risk corridors,” was for the marketplaces’ early years, when it was unclear how many people would sign up and how much medical care they would use.

The risk corridors started in 2014 and run through this December. The idea, patterned after a similar arrangement for health plans that sell Medicare drug benefits, is to balance out insurers’ costs by requiring those with unexpectedly low expenses to pay into a fund that would be used to compensate companies with unexpectedly high expenses. The program originally was not supposed to pay for itself, but two years ago the Republican-led Congress restricted HHS from using any of its other money for that purpose.

The crunch first became apparent last fall, when federal health officials announced that they could make less than $400 million in 2014 risk corridor payments — just 12.6 percent of $2.9 billion overall. About 175 insurers are owed money, according to an HHS list.

Health officials have not said how many insurers need to be paid for 2015, how much they are due or how much money is available. But in a five-paragraph memo this month, HHS’s Centers for Medicare and Medicaid Services (CMS) said that any available money will be put toward what the government still owes for the previous year.

The risk corridor payments are “an obligation of the federal government,” Andy Slavitt, CMS’s acting administrator, told a recent House hearing.

The shortfall has contributed to the collapse of more than half of the 23 nonprofit, consumer-oriented health plans created under the ACA. Four of those co-ops are among the seven insurers suing the government, the most recent this week.

CMS spokesman Aaron Albright referred questions to the Justice Department. Justice spokeswoman Nicole Navas declined to confirm the settlement talks because the litigation is pending.

One health plan executive, whose attorney has spoken with Justice officials, said the department is trying to reach an agreement with suing insurers in the next two weeks on what percentage of the remaining $2.5 billion would be paid out for 2014, as well as for a 2015 amount. At that point, the same offer would be made to every other insurer owed money. A judge would need to approve the arrangement, according to the executive, who spoke about the pending litigation on the condition of anonymity.

Treasury’s Judgment Fund would most likely be the source of the money, the executive and others involved said. The fund’s website shows that it has been used for a few hundred claims against HHS in the past decade. Taken together, they amounted to about $18 million — a fraction of what the insurers are owed.

News of the settlements talk Thursday morning prompted an immediate online debate, with some people condemning the potential use of Treasury’s fund for the payments and others wondering whether those should be guaranteed through the risk corridors’ third year as well.

Stephen Swedlow, a lawyer for Health Republic Insurance in Oregon, a co-op that was forced to close early this year, said he is preparing a settlement proposal to send to Justice. Said Health Republic chief executive Dawn Bonder: “I don’t think DOJ is making a secret that they would like [the lawsuits] to go away.”