Bill Barr: The “Cover-Up General”

Attorney General William Barr Is the Best Reason to Vote for Clinton

A federal judge accuses the Justice De­partment of trying to “shape” a case in­volving illegal loans to Iraq. The House Judiciary Committee blasts federal attor­neys for compromising their reputation for impartiality in the investigation of a com­puter-software theft. CIA officials charge a deputy attorney general with advocating the suppression of evidence in a sensitive sentencing hearing.

To even the most avid scandalmonger, these may sound like the ravings of a fe­vered Orwellian imagination. But in fact they are all part of a litany of wrongdoing leveled at George Bush’s Justice Depart­ment in the past two months alone. And at the center of the criticism is the chief artic­ulator of Bush’s imperial presidency, the man who wrote the legal rationale for the Gulf War, the Panama invasion, and the officially sanctioned kidnapping of, foreign nationals abroad — Attorney General Wil­liam P. Barr.

So fast has Barr’s star dimmed in recent months that even conservative pundits like The New York Times’s William Safire have taken to calling him the “Cover-Up General.” But so poorly understood are Barr’s ties to the president himself that the fires now threatening the Justice Department have barely singed the Oval Office.

To some Washington insiders, that comes as a surprise, for Barr is surely the closest thing this administration has to a court philosopher. Through the policy deci­sions he has authored, first as assistant at­torney general and finally as the chief him­self, he has fashioned a coherent, radical ideology for a White House that is only ostensibly middle-of-the-road.

While the president, for example, hails a “new world order” based on the rules of law, Barr’s briefs give us broken interna­tional covenants. Though conservative pur­ists pretend that the Justice Department remains reactive, the attorney general, bol­stered by an activist Supreme Court, sets aggressively conservative social agendas on everything from abortion to immigration­ — while stalling off inquiries into a myriad of scandals. Indeed, nothing better sums up the political gospel and failings of George Bush’s reign on the eve of this election than the handiwork of his chief lawyer.


It was 21 years ago, in 1971, that I first encountered William Barr. Both of us were working for the CIA at the time, he as a novice China analyst, I as a member of the agency’s Vietnam task force. Jovial and un­assuming, he took his cues easily from an overly politicized office chief. It was a to­ken of things to come.

Three years before, we had brushed shoulders unknowingly on Columbia Uni­versity’s roiling campus. Both of us were on the other side of the barricades as antiwar demonstrations there blasted our genera­tion into a decade of rage. Barr, a conserva­tive student spokesman, preached tough­ness to the university administration, of which his father, then dean of the engineer­ing faculty, was a leading light. Years later, this same damn-the-torpedoes zeal would commend Barr to his ultimate father figure, George Bush. When Cuban refugees penned up at an Alabama prison rioted and took hostages in the summer of 1991, depu­ty attorney general Barr ordered the place stormed. Soon afterward, Bush tapped him for the attorney general slot itself.

Barr first met Bush in the CIA. In 1976, having shifted to the agency’s legislative office, he helped write the pap sheets that director Bush used to fend off the Pike and Church committees, the first real embodiments of Congressional oversight of the CIA. Intimates say the experience was for­mative for Barr, turning him into an impla­cable enemy of congressional intrusions on executive prerogative.

“The most radical period I had probably was when I was sort of a moderate Republi­can,” he later acknowledged. Sure enough, Barr stayed safe within conservative clutch­es even after leaving the agency in 1977. Armed with a night-school law diploma, he asked for — and got — Bush’s backing for a clerkship appointment to Malcolm Wilkey of the Court of Appeals in Washington, D.C. Years later, as attorney general, Barr would name Wilkey to investigate the House Banking scandal. Wilkey repayed the favor with a wrenchingly partisan in­quiry. Feeding the press overheated charges of wrongdoing, he scored points off the Democratic Congress just as the adminis­tration itself was being pilloried for its failed economics.


During the 1980s Barr bounced between government service and a prestigious Washington law firm that would later rep­resent one of the key defendants in the BCCI affair. Barr assured Congress in 1991 that he was long gone from Shaw, Pittman, Potts & Trowbridge by the time it took on its dubious BCCI client. Still, the appear­ance of compromised interests would dog Barr at Justice, particularly as its own in­vestigation of BCCI stalled.

“Like your typical Wall Street lawyer… not a table pounder” was how one of Barr’s legal sparring partners remembered him during his days at Shaw, Pittman. In­deed, “corporate” was written all over him. Though he never tried a case in court, he took on the causes of some of the firm’s starchiest clients, including a nuclear utility in a whistleblower case.

Briefly, in 1982, Barr left the firm for a stint in the White House’s Office of Policy Development. Congress took no action on his two main portfolios, abortion and tu­ition tax credits for low-income parents of private school students. But he did strike up a useful friendship with White House Counsel C. Boyden Gray. This relationship would later help propel Barr to the top spot at Justice and nurture speculation among critics that he was a White House toady.

In 1983 Barr returned to law practice and laid low for the next five years, thus avoid­ing the Iran-contra tar baby. But as Bush launched his presidential bid in 1988, Barr joined the campaign team and, among oth­er things, helped fend off attacks on Dan Quayle’s character. His loyalty was quickly repaid. In late 1988, Barr became the first assistant attorney general to be installed in the wake of the election.

He also began flexing his ideology in pub­lic. During a congressional hearing at the time he boldly acknowledged having “doubts” about the constitutionality of the independent counsel statutes because of what he saw as their limiting effect on pres­idential power.

For the next two years, as chief of the Justice Department’s Office of Legal Coun­sel, Barr played a key role in shaping Rich­ard Thornburgh’s stormy tenure as attorney general. In a job that was essentially politi­cal, he helped maintain the administra­tion’s ideological purity by screening out judicial candidates who weren’t conserva­tive enough. He also drafted two key docu­ments rationalizing the U.S. invasion of Panama and the seizure of General Manuel Noriega.

If Barr had made no other contribution to the imperial pretensions of George Bush, these documents would nevertheless qualify him for hero status in the Republican pan­theon. The first “opinion,” written in June 1989, recognized the president’s right to dispatch FBI agents abroad to arrest for­eigners even in violation of international treaties. The second document, issued the following December as American forces geared up to invade Panama, gave a patina of legality to the president’s desire to use the military in similar takedown opera­tions. Together, the two memos enshrine what has come to be known as the presi­dent’s “snatch authority.”

In an inevitable seignorial flourish, the administration refused to release the com­plete contents of these documents, even to Congress. But over the years, enough of their flavor has seeped into the press to take one’s breath away. Writing in the June memo, Barr argued that both the president and, through him, the attorney general have an “inherent constitutional power” to au­thorize certain overseas operations, includ­ing abductions, to fend off “serious threats” to U.S. domestic “security” from “international terrorist groups and narcot­ics traffickers.” Such actions, he said, are mandated by the Constitution and domes­tic law and can be undertaken even in the face of objections from a foreign government or provisions of the UN Charter bar­ring the use of force against member nations.

When Congress first got wind of these astonishing theories, in November 1989, Barr insisted that they represented no poli­cy change. But weeks later, the Panama invasion kicked off, and the following spring federal agents infuriated the Mexi­can government by arranging to have a Mexican doctor, who had helped torture and murder a DEA agent, abducted and spirited to the U.S. Three years later, the U.S. Supreme Court took up the legality of that action. Though the conservative ma­jority approved it on the grounds that our extradition treaty with Mexico did not spe­cifically bar kidnapping as a law enforcement tool, Justice John Paul Stevens, in dissent, seemed to be speaking for many Americans when he decried the ruling as “monstrous.”

“It is shocking” he wrote, “that a party to an extradition treaty might believe it has secretly reserved the right to make seizures of citizens in the other party’s territory.”

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From the moment the “snatch” memos be­came news, nobody on Capitol Hill seemed in doubt about their authorship. But sur­prisingly, the rancor didn’t rub off. Some­how Barr kept even his critics convinced that he was a conciliator, the type of mod­erate conservative you wouldn’t mind hav­ing to dinner. Journalists tell the story of how on the eve of the Panama operation he charmed the guests at a Thornburgh Christ­mas party by showing up in kilts with bag­pipes under his arm to play for hours. Where Thornburgh rankled, Barr soothed. For an administration increasingly beset by scandal and economic malaise, this capaci­ty for the light touch proved a valued asset.

In mid 1990, as Thornburgh’s own prob­lems with Congress deepened, Barr was tapped to run interference, and was named deputy attorney general. The appointment came just in time for him to draft another landmark tract for the administration, the legal pretext for the undeclared war against Iraq. It would have made any Nixonite proud. Explaining it later to Congress, Barr said he believed there was a “gray zone” between a declared offensive war and an emergency defensive action where “there is latitude for the president, if he believes that the vital interests of the United States are threatened by foreign military attack, there is room for him to respond.”

Barr did not make clear how the Iraqi invasion of Kuwait equaled an attack on vital American interests, but to his credit, at the moment of decision itself, he did counsel the president to soften the impact of his unilateral rush to war by seeking a declaration of congressional support. That piece of advice, much akin to Johnson’s leveraging of the Tonkin Gulf resolution, helped to keep the naysayers at bay.

Barr’s service to the administration, how­ever, wasn’t limited simply to such flashes of political savvy. In 1991 he became active in stone-walling the Iraqgate and the BCCI investigations and further gratified conser­vatives by keeping up the tattoo on their favorite hot-button issues. Embracing im­migration policy as his own, he helped craft an exception rule that automatically barred HIV-positive sufferers from entering the country. Civil libertarians charged illegal discrimination and even racism, since many of those excluded were black Hai­tians. Barr assured Congress that the policy was meant only to keep out people who might be thrown back on public welfare.

Flogging another conservative hobby­horse, Barr fought hard as deputy AG to keep federal courts from expanding their right to review state criminal convictions on writs of habeas corpus. As a devout Catholic, he also pandered to the antiabor­tion crowd, even “torquing” the law in Au­gust 1991 to advance their crusade. The challenge came when a federal judge in Wichita issued an order barring anti-abor­tion demonstrators from blocking access to a clinic. The Justice Department inter­vened to try to force a lifting of the ban. Later asked about this by Congress, Barr gave an exquisitely technical rationale, as­serting that though the demonstrators were “lawbreakers… treading on other people’s rights,” they “should be dealt with” in state court, not federal court — thus the federal judge’s order was unenforceable.

It was vintage Barr, a neat fileting of the law for a political end. Democratic prede­cessors had done the same. But what made Barr an irritant to critics was his adeptness at it.


If any single event assured Barr’s final as­cendancy, it was the Anita Hill-Clarence Thomas confrontation. At his confirmation hearings in November 1991 Barr admitted that Justice’s Office of Legal Counsel had gathered evidence against Hill and commu­nicated with her congressional critics, but he denied any impropriety. “It is my under­standing,” he testified, “that OLC lawyers did not go proactively to investigate Anita Hill… [but] performed the traditional role of lawyers, which was to take the informa­tion coming in, transcripts, statements, and so forth and analyze them.”

Democratic senators were not convinced, but because the Hill-Thomas fight had been so bitter — and because no one wanted a replay of the fractious hearings that had greeted Robert Gates’s bid to become CIA director — Congress cleared Barr’s nomina­tion with barely a protest.

When Barr finally moved into the AG’s chair in late 1991, he talked tough about combatting drugs and crime and immedi­ately shifted 300 FBI agents from counter-intelligence work to antigang and violent-­crime squads. In addition, an inner-city program that he dubbed “Weed and Seed,” aimed at weeding out violent criminals and revitalizing neighborhoods, was soon ele­vated to administration policy.

For all the fanfare, however, critics sensed little more than smoke and mirrors. The Noriega conviction, which Barr touted as a major blow to narcotrafficking, pro­duced no slackening of the drug flow through Panama. Moreover, the Rodney King affair and the subsequent L.A. riots exposed a glaring contradiction in the de­partment’s get-tough policy on crime.

Responding to the acquittal of King’s po­lice attackers, Barr empaneled a federal grand jury to investigate. But, lest he offend Bush’s law-and-order constituency, he con­tinued to stall off other initiatives. Over a year ago, Representative Don Edwards in­troduced a bill making it a federal crime for a police officer to engage in a “pattern” of excessive force and empowering victims to sue to stop such abuses. But under the hammering of Justice and some friendly senators, the still-pending bill lost its teeth, degenerating into a simple authorization that would permit the attorney general him­self to sue offending police departments.

On top of this, Justice officials have pi­geonholed until after the election two long-promised, potentially explosive studies of 15,000 police brutality complaints from across the-country. The delay outrages black leaders, who fear further frustration and violence. “The department’s response to this issue has been totally inadequate,” the NAACP’s Washington director Wade Henderson recently told the Legal Times.

On other fronts, displays of partisan ex­cess under Barr’s stewardship are becoming bolder, more transparent. Last summer, in deference to the administration’s anti-regulation agenda, the attorney general himself overruled the EPA and his own staff and wrote an interpretation of the Clean Air Act that dismantled its most important pol­lution regulation. He also took another im­perious swipe at the immigration issue by helping devise a new policy that authorizes the Coast Guard to intercept Haitian refu­gees on the high seas and return them to their island. The initiative was a response to the flood of refugees unleashed by the military coup in Haiti last fall. But human rights organizations have gone to court to challenge its legality, declaring that it vio­lates UN protocols that forbid the repatria­tion of those who face political persecution at home. “It is another example,” says hu­man rights lawyer Michael Ratner, “of the Barr regime flouting the law for political ends.”

The truest measure of Barr’s extremism, however, lies in the coils of three unfolding national scandals. The central question they pose is: How far will he go to protect his master? The answer, some feel, already exposes Barr to the risk of a grand jury investigation and maybe worse.

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Nobody knows how much the American taxpayer has lost in the BCCI affair, but after years of start-stop investigations it is apparent that federal authorities knew as early as 1983 that the London-based Bank of Credit & Commerce International was trying to buy into the American banking system illegally, even as it engaged in a variety of crimes abroad.

Why the Justice Department was so slow to step in has never been adequately ex­plained. Some accuse Thornburgh and Barr of trying to cover up BCCI links to Iran­contra and the CIA, which has admitted using the bank’s facilities abroad in covert operations. No substantiation has been found for this charge, but few doubt that a stall-off did occur at Justice.

The initial culprit appears to have been the CIA, which, though aware early on of BCCI’s inroads into American banking, chose not to inform the attorney general. Even so, by 1988 the violations were so blatant that Senator John Kerry stumbled on them while heading up a subcommittee on drug trafficking. He alerted the Justice Department — to no avail. Later, a Customs bust prompted indictment of some BCCI officials in Tampa, but inexplicably the Justice Department pursued only low-level prosecutions, while leaving top BCCI offi­cials untouched.

Finally, in July 1991, banking authorities worldwide moved to shut BCCI down. Deputy Attorney General Barr admitted to Congress at the time that there had been “coordination” problems in the investiga­tion and promised to remedy them. But a top federal prosecutor in Miami later ac­cused Barr and other Justice officials of repeatedly thwarting his own efforts in 1991 to indict the bank of fraud charges.

What broke the logjam was Senator Ker­ry’s own impatience. Frustrated with Jus­tice’s inaction, he eventually had one of his investigators, Jack Blum, turn some dirt on BCCI over to New York state district attor­ney Robert Morgenthau, who promised an investigation of his own. That did it. In December 1991, the Justice Department joined Morgenthau in announcing a plea arrangement with BCCI that nailed the bank for various criminal violations and obligated it to fork over $550 million, the largest criminal forfeiture ever obtained by the government. Last July, Morgenthau and federal attorneys in New York dropped the other shoe, announcing the indictments of Democratic Party patriarch Clark Clifford and his law partner on charges of lying to banking regulators, bribe-taking, and falsification of records — all in service of their onetime client, BCCI. Both men pleaded not guilty.

Barr gloated, declaring after the initial plea agreement that this “resolves all United States charges against BCCI as an insti­tution.” But Senator Kerry’s own analysis of the scandal, released only a few weeks ago, makes clear that the Justice Depart­ment’s investigation of BCCI was often too little, too late.

Says Blum, whose approach to Morgen­thau levered Barr into action: “Justice’s handling of BCCI gives the lie to the ad­minstration’s claim to being hard-line on crime.”


Barr has long been a critic of the indepen­dent counsel law and has argued that Jus­tice officials are professional enough to in­vestigate themselves and their own masters. But a report on the Inslaw affair, released in September by Representative Jack Brooks’s Judiciary Committee, obliterates that claim.

At issue is whether the Justice Depart­ment itself stole valuable computer soft­ware from the Washington-based Inslaw company in the early 1980s. Four years ago, a lawyer for Inslaw called for the ap­pointment of an independent counsel to investigate, but Thornburgh resisted, and at his own confirmation hearings in Novem­ber 1991 Barr announced that he was nam­ing an in-house counsel under his own con­trol to handle the inquiry. According to the recently released Brooks report, that inves­tigation has yet to bear fruit in part because Barr delayed granting his appointee subpoena power.

Even worse, says the report, Justice offi­cials stonewalled the committee’s own ef­forts to get at the facts, by blocking access to witnesses, and by denying and even “los­ing” relevant documents. The report blames this “lack of cooperation” for the tenativeness of its own conclusions, but leaves little doubt where the committee’s sympathies lie. Pointing out that Justice officials concluded as early as 1986 that Inslaw’s claim to the disputed software was “legitimate,” the report says the depart­ment nonetheless spent $1 million fighting the issue in court, thus raising the “spectre” of “an abuse of power of shameful proportions.”

“The Department of Justice is this na­tion’s most visible guarantor of the notion that wrongdoing will be sought out and punished irrespective of the identity of the actors involved,” the report concludes. “The Department’s handling of the INSLAW case has seriously undermined its credibility and reputation in playing such a role.”

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Last week the chair of the Senate Intelli­gence Committee lent his voice to a chorus already calling for an independent counsel to investigate how the Justice Department, CIA, and FBI bungled a case in Atlanta involving $5 billion in illegal loans to Iraq. Over a month ago, William Barr rebuffed a similar congressional request and bridled at suggestions that his department couldn’t handle the inquiry itself. But since then, the CIA has accused one of Barr’s subordinates of having “strongly advised” that relevant intelligence be withheld from the federal judge in Atlanta who until recently was handling the case. In response, Barr has just announced that he’s appointing a special prosecutor — a Republican judge — to inves­tigate under Justice Department supervi­sion. It’s precisely the kind of stall tactic Barr used so effectively in the INSLAW affair.

In basic terms, the controversy is over the classic cover-up question of who knew what when — and bears critically on the most sensitive foreign policy issue of the Bush presidency, the coddling of Saddam Hussein prior to the Gulf War.

To be up to speed, you have to under­stand a few arcane facts. First, the adminis­tration is accused of having allowed U.S. agricultural loan guarantees to be used to underwrite military purchases by Iraq during the late 1980s when the official policy was: moderate through conciliation. Sec­ond, the Atlanta branch of the Italian bank Banca Nazionale del Lavoro is said to have floated $5 billion in illegal loans to Iraq during the same period. Third, the Justice Department is suspected of having deliber­ately singled out BNL’s Atlanta branch manager for prosecution, saying he acted alone, so as to avoid embarrassing his high­er-ups in Rome and opening a can of worms that could reveal deeper administra­tion complicity in the funding of Iraq’s military buildup.

Along the way, evidence has surfaced that the Commerce Department altered documents that pointed to the dual use (read: military) applicability of certain items the Iraqis had purchased with U.S. aid.

Still awake? Please, there’s more. In Feb­ruary 1991, the Justice Department struck a plea agreement with the BNL manager in Atlanta that pledged him to clam up, mak­ing no statement in court, in exchange for having the charges against him lessened. Members of the Senate Judiciary won­dered: what gives? So did the Atlanta feder­al judge, Marvin Shoob, who late last sum­mer was about to sentence this apparent fall guy. Shoob called for an independent counsel to sort out the mess.

That’s when the bureaucrats began quick-­stepping. On September 4, the CIA sent the Justice Department a classified letter that glossed over early intelligence reports indi­cating top-level knowledge within BNL Rome of the Atlanta branch’s illicit Iraqi loans. Ten days later, House Banking com­mittee chair Henry Gonzalez, who’d previ­ously goaded the CIA into giving him the facts, spilled them in a speech on the floor of the House. Inevitable conclusion: the U.S. intelligence community knew, by late 1989, that BNL from top to bottom had played fast and loose with American bank­ing regulations. Why, then, such a delay in prosecution?

The CIA continued to duck and weave, claiming in a letter to Shoob on September 17 that nobody knew nothin’ about the early intelligence reports implicating BNL-­Rome in the scandal.

As the heat intensified, however, so did the weakness in bureaucratic knees. On Oc­tober 8 CIA lawyers, testifying to the Sen­ate Intelligence Committee, declared that a devil at Justice had made them do it – that one of Barr’s subordinates had encouraged them to skimp the truth in the letter to Shoob. Justice officials struck back by play­ing victim. How do you suborn the CIA? they demanded publicly. The CIA again parried by claiming that the early tell-all intelligence reports fingering BNL-Rome had been known to FBI and thus Justice officials since late 1989. Barr in turn or­dered FBI chief William Sessions investi­gated on unrelated ethics charges — a probe that some see as an attempt to buffalo the Bureau at the very moment it might be tempted to investigate Iraqgate on its own.

You can’t be awake. But what’s impor­tant is this: The Justice Department stands accused by the nation’s premier intelligence agency of having abetted the cover-up of a possible crime, even to the point of shaving evidence. Maybe this simplifies it, but the allegation itself should give pause even to the most devout law-and-order conserva­tive. And no, this ain’t a mugging, baby. The lawlessness espoused in Barr’s snatch memos inevitably breeds offspring.

There is, too, the more basic issue of equity: Imagine you’re the manager of At­lanta’s BNL branch who’s wound up in Barr’s cross hairs because the Justice De­partment and everybody else in the Bush administration needed a scapegoat for their own policy errors. On October I he did get a reprieve of sorts: The Justice Department decided to try him rather than embarrass itself further by sticking with the plea agree­ment that so artfully found him guilty with­out giving him a chance to speak. Even so, if you’re in his shoes, do you place any stock in American justice? Or, as one critic said of the snatch memos, do we have here a regime of law that says: when the presi­dent declares it’s illegal, it is? ■


Occupy Heavily Monitored for Potential Criminal Activity, HSBC Slapped on the Wrist for Actual Criminal Activity

Apparently non-violent demonstration against corrupt banking is subject to more criminal scrutiny than actual corrupt banking.

Documents released by the Partnership for Civil Justice Fund Saturday show that the FBI identified Occupy Wall Street as a “potential criminal and terrorist” threat as early as a month before the OWS movement burst on the international scene with its initial occupation of Zuccotti Park in September 2011.

“These documents show that the FBI and the Department of Homeland Security are treating protests against the corporate and banking structure of America as potential criminal and terrorist activity,” Mara Verheyden-Hilliard, executive director of PCJF, said in a release . “These documents also show these federal agencies functioning as a de facto intelligence arm of Wall Street and Corporate America.”

The release of the documents comes a few weeks after federal and state authorities, including the Department of Justice and the New York East District Attorney’s Office, announced a $1.9 billion settlement agreements with British-based bank, HSBC, for allowing major drug cartels and entities with economic sanctions and terrorist ties to launder money through the bank.

“HSBC’s blatant failure to implement proper anti-money laundering controls facilitated the laundering of at least $881 million in drug proceeds through the U.S. financial system,” New York U.S. Attorney Loretta Lynch said in a release. “HSBC’s willful flouting of U.S. sanctions laws and regulations resulted in the processing of hundreds of millions of dollars in [Office of Foreign Assets Control]-prohibited transactions.”

For more than a decade, HSBC’s U.S. subsidiary, HSBC Bank USA, knowingly allowed money transactions coming from sanctioned countries such as Iran, Sudan and Libya. And, banking officials at HSBC knowingly altered documents to prevent them from being red-flagged.

A report released by the U.S. Senate Committee on Investigations reveals that, at least as far back as 2006, HBUS allowed major drug-trafficking cartels, such as the infamous Sinaloa Cartel of Mexico, to funnel nearly $900 million in drug revenues through the bank.

HSBC engaged in money laundering schemes dating back to the 1990s but weren’t hit with any type of punishment for those schemes until earlier this month. OWS moved to speak out against that very type of corruption and were hounded by federal authorities before the movement was even launched.

The FBI actually went as far as to meet with officials at the New York Stock Exchange in August of 2011 to warn of the impending demonstration, according to the PCJF-obtained documents. Yet with the settlement reached, no one at HSBC will be criminally prosecuted for years of blatantly illegal practices involving billions of dollars.

Officials close to the investigation of HSBC told the New York Times that they ultimately decided not to prosecute the bank because it was essentially too big to fail. Lawrence White, a professor of economics at New York University, acknowledges that the $1.9 billion fine certainly won’t do major damage to HSBC, but believes that it is effective.

“HSBC is a big bank with literally trillions of dollars of assets. So, a penalty $1.9 billion it doesn’t cripple the bank but it stings. Nobody likes to write a check that has ten digits,” White told the Voice after the fine was announced. “It gets everybody’s attention. It certainly will focus the attention of HSBC. It will certainly focus the attention of other similarly situated banks.”

A member of the Occupy movement, who goes under the pseudonym Goldi Locks and is currently involved in the volunteer efforts of Occupy Sandy, believes the fine is merely a slap on the wrist.

“The fact that there is no criminal sort of prosecution is surprisingly on one level but not surprising on another… The banking industry is completely lawless – something we’ve been saying all along,” Goldi said. “These banks can do whatever they want with impunity. To level what for them is a small fine, even though it’s large in the history of fines, it’s just absurd.”


Russian Spies Still Exist, Apparently

Federal prosecutors in Brooklyn announced this morning the indictment of 11 members of a Russian “military procurement network” operating in the United States, who allegedly have been shipping U.S. military technology to the former Soviet Union since 2008.

See the full indictment — compliments of the U.S. Attorney’s Office — below.

According to the feds, the 11 people indicted illegally exported high-tech micro-electronics — used for things like radar and surveillance systems, weapons guidance systems, and detonation triggers — to Russian military intelligence agencies on behalf of the Russian government.

In doing so, the Ruskies “spun an elaborate web of lies to evade the laws that protect our
national security,” Brooklyn U.S. Attorney Loretta Lynch said this morning.


The alleged ring-leader is 46-year-old Alexander Fishenko, a Russian national living in the U.S. since 1994. He became a naturalized citizen in 2003.

In 1998, Fishenko founded Arc Electronics, Inc. (ARC), which he based out of Houston. According to the feds, since 2002, ARC — using JFK Airport as its principal port of export — has shipped more than $50 million worth of military-grade micro-electronics to his Russian counterparts, who gave the technology to Russian intelligence agencies.

Because the materials can be used for military purposes, the micro-electronics are subject to strict government licensing restrictions. To get around the restrictions, the feds say Fishenko and his cronies would classify the items incorrectly to avoid getting hassled by the U.S. Commerce Department.

“For example, in order to obtain microelectronics containing controlled, sensitive technologies, Arc claimed to American suppliers that, rather than exporting goods to Russia, it merely manufactured benign products such as traffic lights,” authorities said. ‘Arc also falsely claimed to be a traffic light manufacturer on its Web site. In fact, Arc manufactured no goods and operated exclusively as an exporter.”

Each of the defendants have been charged with conspiring to violate the International Emergency Economic Powers Act and the Arms Export Control Act.

Additionally, Fishenko’s been charged with acting as an unregistered agent of the Russian government.

If convicted, the defendants face up to 20 years in prison.

See the indictment below.

Fishenko – Signed Indictment


Long Island Dr. Feel-Good Charged In Oxycodone Overdose Deaths Of Two Patients

A Long Island physician has been charged in the deaths of two patients who overdosed on Oxycodone last year, federal prosecutors announced this morning.

Additionally, the doctor’s former office assistant has been hit with charges alleging that he was involved in the unlawful distribution of the dangerous narcotic drug to several patients, many of whom didn’t actually need it for anything other than feeding their addiction.

According to a 47-count indictment unsealed by federal prosecutors this morning, between January 2009 and November of 2011, Doctor William Conway wrote 5,554 prescriptions — 782,032 pills — for oxycodone to
“patients” he knew were addicted to the drug. In many cases, he did so
without requiring the “patients” to undergo a medical examination.

Two of those patients, Giovanni Manzella and Christopher Basmas, died from overdoses of the drugs.

Manzella’s case, he was pronounced dead on April 23, 2011, less than 48
hours after Conway had written him two prescriptions for a total of 450
pills of Oxycodone.

Basmas died on October 27, 2011, just two days after Conway had written him a prescription for 180 pills.

Basmas’ death, the feds say Conway attempted to alter patient records
to make it look as thought he’d given him an actual medical examination
when, in fact, he hadn’t — he just recorded his height and weight, etc.

former office assistant, Robert Hachemeister — known as “Dr. Bob,”
despite having no medical or nursing degree — has been charged with
conspiracy and distribution of Oxycodone for allegedly handing
out prescriptions for the drug from a prescription pad pre-signed by Conway.

Conway initially was
arrested in June, when state and federal authorities went gangbusters on
prescription pill distributors
in a sweep that netted 100 arrests,
including Conway and another doctor.

The sweep came on the heels of a 98-page grand jury report
released in May by Suffolk County District Attorney Tom Spota about
prescription drug abuse on Long Island. The report was in response to
the “Father’s Day Massacre,” when a pill junky murdered four people
while robbing prescription painkillers from a pharmacy in Medford. As we
noted in May, the report ain’t pretty.

According to the report, Suffolk County has 70 percent more Oxycontin prescriptions than the average of any other state.

The report also finds that overdose victims with Oxycontin in their blood has risen 266 percent since 2004.

Since 1996, the Suffolk County Drug Court program has seen a 1,136 percent increase in opioid pill abuse.  

If convicted, Conway faces a mandatory minimum sentence of 20 years in prison. The maximum sentence he could receive is life.


Obama’s DOJ Compares a “Reporter’s Privilege” For Leaks to Buying Drugs

The Obama administration has had a tough time fighting the War on Leaks. From Bradley Manning’s arrest in the WikiLeaks controversial to the successful subpoenaing of Twitter, critics have heralded the Presidency as one of the most anti-leak executive reigns in recent history.

And a new chapter was written in the War’s history books yesterday.
Four years ago, Pulitzer-Prize winning New York Times reporter James Risen wrote a book entitled “State of War: The Secret History of the CIA and the Bush Administration.” In it, Risen used leaked information from former CIA agent Jeffrey Sterling, who is now being charged with releasing classified details about a botched plot against Iran. That little inclusion led Attorney General Eric Holder to subpoena Risen three (failed) times to testify against Sterling.
He has pleaded the Fifth on all occasions, arguing that he had a “reporter’s privilege” – a doctrine that keeps the press out of cases like this on the basis that they are simply the middlemen of information. And, in 2011, a federal judge ruled that he had a “qualified privilege” to keep his mouth shut, saying that a subpoena gave no right for the government to “rifle through a reporter’s notebook.”
But, on Friday morning, it looked like the Department of Justice could care less.

DOJ appellate lawyer Robert A. Parker took a revisionist approach to the freedom of the press, comparing the refusal of Risen to testify to that of a drug deal. Here’s his logic: not being accountable to leaked information is like if a reporter received drugs from an unknown source and refused to talk about it. In this sequence of events, leaked information regarding secret operations is equivalent to buying weed. How’s that for justice?

In response to that leaks-drugs analogy yesterday, federal judge Robert Gregory simply said, “You think so?” We are asking that ourselves, too.
But Parker is basing that analogy on a court case from 1971 called Branzburg v. Hayes, in which a federal court decided that a reporter must testify if they witness a crime. The decision was made after a reporter watched drug dealers synthesize the product and then wrote about it in a Louisville newspaper. Maybe that’s where the drugs reference came from.
However, the only difference, according to the judges, is that obtaining leaked information is not the same as witnessing a crime – what Risen did was that of disclosure, not criminal activity.
The Times journalist argued this point at the beginning of the month in front of the National Press Club, in which he chastises the Obama administration for stepping on the press’s rights: “The basic issue is whether we can be a democracy without aggressive investigative reporting.”
It will be interesting to see what the Fourth Circuit Court of Appeals rules on the existence of a “reporter’s privilege” in the field of leaks. With occasions of this seemingly popping up everywhere, a decision against Risen could be a benchmark in the history of the freedom of the press. And a plus for the Obama administration’s War on Leaks.

“Cypress Hills Weed And Seed Job Fair” Is Not What You Think (Hope) It Is

If you go to the “Cypress Hills Weed and Seed Job Fair” in Brooklyn tomorrow and expect to come away with a sweet gig farming marijuana, you will be extremely disappointed.

We got an email this afternoon from the United States Attorney’s Office alerting us to the aforementioned job fair. Normally, emails about job fairs get a one-way trip to our trash folder. However, given the connotations associated with “Cypress Hill” and “weed” — and considering the source of the email — we figured “sure, we’ll bite…”

Upon further review of the email, it turns out the band Cypress Hill has nothing to do with the job fair, and chances are there will be no weed.

We asked Justice Department spokesman Robert Nardoza if the name of the job fair was just a scam to get stoners to show up at a place where federal authorities would be waiting to throw the cuffs on them (no, under federal law, marijuana has not been decriminalized as it has been in New York since the 1970s — and the feds will bust you). He assures us that “no, it’s a real job fair.”

He appears to be telling the truth — “Weed and Seed” is a “community-based strategy” program administered by the DOJ. It’s goal is to reduce crime, drugs, gang activity and violence in high-crime neighborhoods. Cypress Hills, Brooklyn, has been a “Weed and Seed” neighborhood since 2009 — and tomorrow there apparently will be a jobs fair.

According to “Weed and Seed” officials, there will be several employers in attendance with active job openings. Additionally, the New York State Department of Labor will be there to upload job resumes into the state’s SMART system, which stores resumes in a database to keep job-seekers updated when employment opportunities arise.

If you plan on attending, “Weed and Seed” officials suggest bringing 15 copies of your resume.

The jobs fair will be held at Blessed Sacrament Parish Hall at 108 Pine Street in Brooklyn. For more info, click here.

We called “Weed and Seed” officials to see if they’d consider changing the name of the Cypress Hills event to avoid further confusion. They didn’t return our call.