Category Archives: Treasury

Daily Gas Pump Prices are Based on the Strait of Hormuz

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Experts said Iranian officials are trying to demonstrate to the U.S. and its allies that the Islamic Republic is able to push back and gain leverage against the Trump administration’s “maximum pressure” policy, which intensified after President Trump pulled the U.S. out of the landmark nuclear deal in May 2018 and reimposed crippling sanctions, making it difficult for Iran to export oil, the foundation of the country’s economy.

China, Russia and leading Western European countries have sought ways around the U.S. sanctions, but it has been difficult to bypass them.

“The message that Iran is sending is that it is capable of making international waters unsafe not just for the U.S., but for international trade,” said Reza H. Akbari, a program manager and Iran expert at the Institute for War and Peace Reporting.

These are the reasons for oil tanker seizures and attacks by Iranian limpet mines.

Tensions between the West and Iran bubbled to a historic height in recent days after the assassination of top Iranian military commander Qassem Soleimani and Tehran bombed two Iraqi bases that housed US troops.

They have sparked fears of wider US-Iran attacks in the greater region, which could take place in and around the Strait of Hormuz, a narrow body of water linking the Persian Gulf to the Gulf of Oman, which feeds into Arabian Sea and the rest of the world.

strait of hormuz jan 2020

A satellite image of marine traffic passing through the Strait of Hormuz as on January 9, 2020.MarineTraffic.com

While Iran’s leaders claim to have “concluded” their revenge for Soleimani’s death — and President Donald Trump appears to believe them — many regional experts and diplomatic sources say Iran could unleash other modes of attack, which include unleashing allied militias to disrupt the Middle East.

One strategy could include Iran closing the Strait of Hormuz, which would stop oil tanker traffic, disrupt global oil supply, and send prices shooting up.

Here’s what you need to know about this valuable strait.

Some 21 million barrels of crude and refined oil pass through the strait every day, the EIA said, citing 2018 statistics.

That’s about one-third of the world’s sea-traded oil, or $1.2 billion worth of oil a day, at current oil prices. The majority of Saudi Arabia’s crude exports pass through the Strait of Hormuz, meaning much of the oil-dependent economy’s wealth is situated there. Saudi state-backed oil tanker Bahri temporarily suspended its shipments through the strait after Iran’s missile strikes in Iran, the Financial Times reported.

Last June Iran shot down a US drone flying near the strait, and a month later a US warship — USS Boxer — also shot down an Iranian drone in the same area.

Shortly after Iran’s drone attack, President Donald Trump questioned the US’ presence in the region, and called on China, Japan, and other countries to protect their own ships passing through the Strait of Hormuz.

Trump noted that much of China and Japan’s oil flow through the strait, and added: “So why are we protecting the shipping lanes for other countries (many years) for zero compensation.”

While a large proportion — 76% — of oil flowing through the chokepoint does end up in Asian countries, the US still imports more than 30 million barrels of oil a month from countries in the Middle East, Business Insider has reported, citing the EIA.

That’s about $1.7 billion worth of oil, and 10% of the US’s total oil imports per month.

Iranian leaders, who have also vowed retaliation for the death of Soleimani, have threatened to close down the strait multiple times in the past.

If Iran followed through with these threats, it would likely cause huge disruption to the global oil trade. As the strait is so narrow, any sort of interference in tanker traffic could decrease the world’s oil supply, and send prices shooting up.

Global oil prices have proven vulnerable to tensions between Iran and the West before. After the Trump administration said in April 2019 it would stop providing sanctions waivers to countries who purchase Iranian oil, prices rose to their highest level since November the year before, Axios reported.

How likely is Iran to shut down the strait?

Iran is more likely to disrupt traffic in the Strait of Hormuz than to engage in an all-out conventional war with the US, which is much stronger militarily.

But doing so comes with high costs to Iran.

To close down the entire strait, Iran would have to place at least 1,000 mines with submarines and surface craft along the chokepoint, security researcher Caitlin Talmadge posited in a 2009 MIT study. Such an effort could take weeks, the study added. (taken in part from here)

Trump Signs the Caesar Act into Law

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America has short memories yet war atrocities continue in Syria. For those that were very skeptical about the use of chemical weapons used in Syria by the Assad regime, here is the truth. Meanwhile. the Assad regime remains in power due to assistance from Russia and Qassim Soleimani was the wartime, military advisor to Assad.

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He was once a military photographer in Syria. For two years, he took pictures of the emaciated and mangled corpses left behind by Bashar al Assad’s interrogators. Then he fled to Europe with 55,000 digital images on flash drives hidden in his shoes.

Even members of Congress know him only as Caesar. When he spoke to them for the first time in 2014, he wore sunglasses and a bright blue windbreaker with the hood pulled over his head. No one recorded his voice or took pictures of his face. The Assad regime would assassinate him if it could.

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Two days after Christmas, President Trump signed into law the Caesar Act, a tribute to the man whose photographs have proven the war crimes of the Assad regime beyond the shadow of a doubt. When the FBI’s Digital Evidence Laboratory examined Caesar’s work, it found no signs of manipulation.

The bodies in Caesar’s images bear a striking resemblance to the ones in photographs of concentration camps liberated from the Nazis. Fittingly, the U.S. Holocaust Memorial Museum has had a selection of Caesar’s images on display since 2015.

The purpose of the Caesar Act is to put unprecedented economic pressure on the Assad regime. The United States and European Union put some tough sanctions on Mr. Assad and his henchmen in the early days of the war in Syria, but enforcement has been partial.

Whereas existing U.S. sanctions prohibit Americans from doing business with the Assad regime, the Caesar Act authorizes sanctions on the citizens of any country who work with Mr. Assad. The act specifically targets the Iranian militias and Russian mercenaries that have kept the Syrian dictator in power.

Although Moscow and Tehran have secured Mr. Assad’s grip on Damascus and other major cities, the war in Syria is far from over. An estimated 3 million Syrians are now crowded into the northwestern province of Idlib, which remains under the control of a variety of rebel forces, including extremists with ties to al Qaeda. As usual, Mr. Assad and his allies are targeting civilians, not terrorists. Hospitals are especially popular targets.

Thus, the Caesar Act still serves a pressing need. Economic pressure is one of the few means of holding war criminals to account for their actions. Sanctions alone will not bring down the Assad regime, but in concert with diplomatic and military pressure they should be part of any sound strategy.

On Twitter, Mr. Trump has made very clear that his administration is on the side of the Iranian people against their tyrannical regime. He should be equally clear in his support for the people of Syria. One can certainly object that Mr. Trump’s concern for human rights is selective, yet when the president of the United States speaks, the world pays attention. When the world is watching, war criminals hesitate.

The United States is not at war with Mr. Assad, but a U.S.-led coalition now controls about a fourth of Syria, which was formerly part of the ISIS caliphate. Twice now, Mr. Trump has ordered the withdrawal of U.S. troops only to reverse himself under intense pressure from Republicans in Congress. This wavering only emboldens Mr. Assad, who wants to take back the resource-rich areas under the coalition’s control.

In terms of economic pressure, aggressive enforcement of the Caesar Act should be the first priority. Syria remains dependent on illicit shipments of Iranian oil. The Treasury Department has become more aggressive in its pursuit of sanctions evaders, but tankers of Iranian oil are still getting through.

With Russian help, Syria is also trying to revive its phosphate industry, which generated more than $100 million per year of export revenue before the war. Reportedly, Lebanese companies are buying the phosphates before reselling them abroad, likely after processing the raw material into crop fertilizer.

One entity beyond the reach of the Caesar Act is the United Nations, whose humanitarian agencies have been so deferential to the Assad regime that their aid has effectively become a subsidy for Mr. Assad’s war effort. Independent human rights organizations have produced lengthy reports on this travesty year after year, but donor states have not demanded accountability.

This is one area where further congressional action could make a difference. If there is a second Caesar Act, it should condition U.S. funding for U.N. humanitarian work on verifiable reforms. European governments should impose similar conditions.

Caesar demonstrated extraordinary courage by patiently collecting evidence of Mr. Assad’s war crimes. He saw his friends and neighbors among the dead, but he could say nothing. Had his superiors discovered his plans, his corpse would have been the next one in a photograph.

What Caesar deserves is not just a law, but a sustained American commitment to human rights in Syria.

*** From Human Rights Watch: The 86-page report, “If the Dead Could Speak: Mass Deaths and Torture in Syria’s Detention Facilities,” lays out new evidence regarding the authenticity of what are known as the Caesar photographs, identifies a number of the victims, and highlights some of the key causes of death.

Hey Hollywood/Democrats, Killing Soleimani was Legal

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Quds force commander, Qassim Soleimani death by drone strike approved by President Trump is legal. That decision was not a decision to go to war or launch additional military conflict(s) with Iran. How about referring to General David Petraeus confirming that killing Soleimani is more significant and consequential that taking out Osama bin Ladin and al Baghdadi.

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Former Department of Homeland Security Secretary and lawyer, Jeh Johnson also confirmed the order/approval to kill Soleimani by President Trump is legal without Congressional knowledge or approval.

 

Revised in 2016, from the Judge Advocate General, the laws of armed conflict defines the rules.

AFD-160210-019  (2 pages) During a time of conflict, you may only attack lawful targets, which include certain people, places, and things. Combatants are lawful targets. A combatant is anyone engaging in hostilities in an armed conflict on behalf of a party to the conflict. All members of the military are combatants except for medical personnel, chaplains, POWs, wounded and sick, shipwrecked, and parachutists escaping disabled aircraft.

Further: The War Powers Resolution requires the president to notify Congress within 48 hours of committing armed forces to military action and forbids armed forces from remaining for more than 60 days, with a further 30-day withdrawal period, without a congressional authorization for use of military force (AUMF) or a declaration of war by the United States. The resolution was passed by two-thirds each of the House and Senate, overriding the veto of the bill by President Richard Nixon.

Further to the media, the Democrats and to Hollywood –>

THE PRESIDENT’S CONSTITUTIONAL AUTHORITY TO CONDUCT MILITARY OPERATIONS AGAINST TERRORISTS AND NATIONS SUPPORTING THEM

       The President has broad constitutional power to take military action in response to the terrorist attacks on the United States on September 11, 2001. Congress has acknowledged this inherent executive power in both the War Powers Resolution and the Joint Resolution passed by Congress on September 14, 2001.

The President has constitutional power not only to retaliate against any person, organization, or State suspected of involvement in terrorist attacks on the United States, but also against foreign States suspected of harboring or supporting such organizations.

The President may deploy military force preemptively against terrorist organizations or the States that harbor or support them, whether or not they can be linked to the specific terrorist incidents of September 11.

It cannot be understated that the United States under President Trump and in collaboration with U.S. Treasury and the U.S. State Department which hold the terror list along with the Department of Defense that there are more targets, least of which is al Shabab, al Qaeda, Hezbollah and Islamic State.

For exact reference, was listed as a FTO, Foreign Terror Organization on July 2, 2009. Click here for the FTO list.

***

Meanwhile:

Abu Ali al Askari’s Twitter statement calling for volunteers for suicide operations in Iraq.

Abu Ali al Askari, the security official for Iraq’s Hezbollah Brigades (or Kata’ib Hezbollah, KH), purportedly released a statement earlier today calling for volunteers for suicide bombings against US forces in Iraq.

On Askari’s Twitter account, which has been utilized in the past to distribute KH statements, the official says that “I call for the opening of the door of registration for the lovers of martyrdom, to conduct martyrdom operations [suicide bombings] against the foreign Crusader forces.”

This short statement was then republished by social media channels affiliated with KH on both Twitter and Telegram. In addition, a Lebanese Hezbollah-affiliated Telegram account has also republished the statement.

No official word has been made on KH’s website as of the time of publishing, however.

The US-designated Hezbollah Brigades were led by Abu Mahdi al Muhandis until his death by a US drone strike yesterday alongside Iranian Qods Force commander Qassem Soleimani in Baghdad

 

Locked Shields Versus Iran

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Since the death of several Iranian warlords including Qassim Soleimani, the United States has dispatched more military personnel to the Middle East. The Patriot missile batteries scattered in the region including in Bahrain are now at the ready. When it comes to cyber operations inside Iran, little is being discussed as a means of retribution against the United States. Iran does have cyber warfare capabilities and does use them.

It has been mentioned in recent days that President Trump has been quite measured in responding to Iran’s various attacks including striking Saudi oil fields, hitting oil tankers and shooting down one of the drones operated by the United States. In fact, the United States did respond directly after the downing of our drone by inserting an effective cyber-attack against Iran’s weapons systems by targeting the controls of the missile systems.

APT33 phishing Read details from Security Affairs.

Iran has an estimated 100,000 volunteer cyber trained operatives that has been expanding for the last ten years led by the Basij, a paramilitary network. The cyber unit known for controlling the Iranian missile launchers is Sepehr 110 is a large target of the United States and Israel. Iran also mobilizes cyber criminals and proxy networks including another one known as OilRig.

In 2018, the United States charged 9 Iranians (Mabna Hackers) for conducting massive cyber theft, wire fraud and identity theft that affected hundreds of universities, companies and other proprietary entities.

Due to a more global cyber threat by Iran known to collaborate with North Korea, China and Russia, NATO has been quite aggressive in cyber defense operations via the Cooperative Cyber Defense Center of Excellence applying the Locked Shields Program.

Not too be lost in the cyber threat conditions, Iran also uses their cyber team to blast out propaganda using social media platforms. If this sounds quite familiar, it is. The Russian propaganda operations manual is also being used by Iran. The bots and trolls are at work in Europe to keep France, Britain and Germany connected to the Iranian nuclear deal and to maintain trade operations with Iran including diplomatic operations. There are fake Iranian and Russian accounts still today all over Twitter and Facebook for which Europe is slow to respond if at all.

Meet APT33, which the West calls the Iranian hacking crew(s), the other slang name is Elfin. APT33 is not only hacking, but it is performing cyber-espionage as well. There are many outside government organizations researching and decoding Iran’s cyber operations that cooperate with inside U.S. government cyber operations located across the globe that also cooperate with NATO.

Recorded Future is one such non-government pro-active cyber operation working on Iran. These include attributions of cyber attacks by Iran against Saudi Arabia as well as the West by decoding phishing campaigns, relationships, malware and webshells and security breeches.

Recent published results include in part:

Nasr Institute and Kavosh Redux

In our previous report, “Iran’s Hacker Hierarchy Exposed,” we concluded that the exposure of one APT33 contractor, the Nasr Institute, by FireEye in 2017, along with our intelligence on the composition and motivations of the Iranian hacker community, pointed to a tiered structure within Iran’s state-sponsored offensive cyber program. We assessed that many Iranian state-sponsored operations were directed by the Iranian Revolutionary Guard Corps (IRGC) or the Ministry of Intelligence and Security (MOIS).

According to a sensitive Insikt Group source who provided information for previous research, these organizations employed a mid-level tier of ideologically aligned task managers responsible for the compartmentalized tasking of over 50 contracting organizations, who conducted activities such as vulnerability research, exploit development, reconnaissance, and the conducting of network intrusions or attacks. Each of these discrete components, in developing an offensive cyber capability, were purposefully assigned to different contracting groups to protect the integrity of overarching operations and to ensure the IRGC and/or MOIS retained control of operations and mitigated the risk from rogue hackers. Read more here in detail from a published summary of 6 months ago.

GOP War Room v. Pelosi’s Impeachment?

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Do the Republicans in both Houses of Congress need to collaborate with the Department of Justice to create a war room to counter the Democrat’s impeachment operation? Yes, and there are several legal and factual avenues to explore. But one in particular is already in play. In fact, it has been in play since at least 2016, long before Former Vice President Joe Biden announced his candidacy for President of the United States.

The Democrats for months have been not only alleging President Trump for inviting a foreign power into our 2020 election process by asking a favor of the Ukraine President. They additionally charge President Trump for publicly asking China for the same thing. Remember, President Trump said in the phone call: can you do US a favor, OUR COUNTRY has been through a lot. That is not a personal favor for President Trump but rather a service to our nation as a whole. Given the decades of rampant corruption in Ukraine and frankly in our own country, you would think the Democrats would want the same favor right when it comes to money-laundering and interference into our election(s).

So, let us go back to that one avenue already in play since 2016 and that is Rosemont Seneca and Bohai Capital.

For example, one of the companies involved in the Henniges transaction was a billion dollar private investment fund called Bohai Harvest RST (BHR). BHR was formed in November of 2013 by a merger between the Chinese-government linked firm, Bohai Capital, and a company named Rosemont Seneca Partners. Rosemont Seneca was reportedly formed in 2009 by Hunter Biden, the son of then-Vice President Joe Biden, Chris Heinz, the stepson of former Secretary of State John Kerry, and others.3The direct involvement of Mr. Hunter Biden and Mr. Heinz in the acquisition of Henniges by the Chinese government creates a potential conflict of interest. Both are directly related to high-ranking Obama administration officials. The Department of State, then under Mr. Kerry’s leadership, is also a CFIUS member and played a direct role in the decision to approve the Henniges transaction. The appearance of potential conflicts in this case is particularly troubling given Mr. Biden’s and Mr. Heinz’s history of investing in and collaborating with Chinese companies, including at least one posing significant national security concerns. This history with China pre and post-dates the 2015 Henniges transaction. For example, in December of 2013, one month after Rosemont Seneca’s merger with Bohai Capital to form BHR, Hunter Biden reportedly flew aboard Air Force Two with his father, then-Vice President Biden to China.4 While in China, he helped arrange for Jonathan Li, CEO of Bohai Capital, to “shake hands” with Vice-President Biden.5 Afterward, Hunter Biden met with Li for reportedly a “social meeting.”6 After the China trip, BHR’s business license was approved.7 In December of 2014, BHR also reportedly became an investor in China General Nuclear Power Corp (CGN), a state-owned energy company involved in building nuclear reactors.8 In April of 2016, the U.S. Department of Justice (DOJ) charged CGN with conspiracy to unlawfully engage and participate in the production and development of special nuclear material outside the United States which could cause “significant damage to our national security.”9 Then, in August of 2015, Gemini Investments Limited, another Chinese-government linked entity, purchased 75 percent of Rosemont Reality, a sister company of Rosemont 3 Seneca.10 Rosemont Realty became Gemini Rosemont and it reportedly focused on purchasing American real estate.11In September 2015, BHR joined with a subsidiary of the Aviation Industry Corporation of China (AVIC) to acquire Henniges for $600 million. AVIC acquired 51 percent of the company, and BHR acquired 49 percent.12 According to reports, the acquisition of Henniges by BHR and AVIC was the “biggest Chinese investment into US automotive manufacturing assets to date.”13 Because the acquisition gave Chinese companies direct control of Henniges’ anti-vibration technologies, the transaction was reviewed by CFIUS. CFIUS approved the transaction despite reports that in 2007, years before BHR teamed up with AVIC’s subsidiary, AVIC was reportedly involved in stealing sensitive data regarding the Joint Strike Fighter program. AVIClater reportedly incorporated the stolen data into China’s J-20 and J-31 aircraft.14

You will notice numbered footnotes in the text above. That text is in part of a letter sent by Senator Grassley (Senate Finance Committee) to Treasury Secretary Mnuchin this past August. It is uncertain if Treasury did respond to the letter. But hold on there is more.

In May of 2016, the Wall Street Journal had an interesting piece regarding the sale of fake Indian tribal bonds. 7 people were charged of this fraud. Among them was a former campaign adviser to Secretary of State John Kerry and a second man once dubbed by the media “porn’s new king” along with five others. Devon Archer, an advisor to Mr. Kerry’s presidential campaign in 2004 and Jason Galanis a former investor in the adult entertainment business allegedly duped clients into investing more than $43 million in sham bonds in 2014 and 2015.

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Now Devon Archer and Hunter Biden were best of buddies. In 2014, there was a lot of money flowing into a Morgan Stanley account under the name of Rosemont Seneca Bohai, LLC c/o Devon Archer.

 

Rosemont Seneca Partners Co… by JohnSolomon on Scribd

Now, we must remember that the United States has a ‘Mutual Legal Assistance Treaty’ (MLAT) with several countries.

Click here for the presentation of the Mutual Legal Assistance Treaty

This is an agreement between two or more countries for the purpose of gather and exchanging information in a effort to enforce laws and prosecute public or criminal cases that include witness statements, service of documents, forfeiture, illicit assets, terrorism, sanctions, freezing accounts, restraining orders, judgement, subpoenas, transfers of financial instruments, security, regulations and disclosures. Most of the time these cases are a result of transnational organized crime, tax evasions or money-laundering. Other cooperative international agencies include Europol, Interpol repatriation organizations including the FBI and the United Nations.

So Nancy, with assistance of some in the Senate, the Treasury Department and the Trump White House, Trump is doing the right thing by following the law, draining the swamp and asking for continued foreign cooperation in fraud cases. Hold your powder everyone, this will get very interesting.