| San Diego Education Report |
| November 2013 |
What happens to whistle-blowers?
To high performers? Often, they get fired.
To high performers? Often, they get fired.
Whistleblowing: A Study of
Managerial Differences
John P. Keenan and
Associates
International, 2
Hillsboro Drive, ... help
curb fraudulent
practices, and in so
doing avoid costly
lawsuits and negative
publicity .... Reprisal
involves taking an
undesirable action
against an employee or
...
by JP Keenan - 2002
· Culture and
Whistleblowing An
Empirical Study of
Croatian and ...
Keenan and
Associates
International, a firm
presenting ..... Against
harm to others .... with
potential costly
lawsuits, and negative
publicity. ...
by AA Tavakoli - 2003
Managerial Differences
John P. Keenan and
Associates
International, 2
Hillsboro Drive, ... help
curb fraudulent
practices, and in so
doing avoid costly
lawsuits and negative
publicity .... Reprisal
involves taking an
undesirable action
against an employee or
...
by JP Keenan - 2002
· Culture and
Whistleblowing An
Empirical Study of
Croatian and ...
Keenan and
Associates
International, a firm
presenting ..... Against
harm to others .... with
potential costly
lawsuits, and negative
publicity. ...
by AA Tavakoli - 2003
Why This Website
Stutz Artiano Shinoff
& Holtz v. Maura
Larkins defamation
SDCOE
CVESD
Castle Park Elem
Law Enforcement
CTA
CVE
Stutz Artiano Shinoff
& Holtz
Silence is Golden
Schools and Violence
Office Admin Hearings
Larkins OAH Hearing
Stutz Artiano Shinoff
& Holtz v. Maura
Larkins defamation
SDCOE
CVESD
Castle Park Elem
Law Enforcement
CTA
CVE
Stutz Artiano Shinoff
& Holtz
Silence is Golden
Schools and Violence
Office Admin Hearings
Larkins OAH Hearing
Oil-Rig Workers Gain Whistleblower Protections in
House Bill
July 30, 2010
Bloomberg Businessweek
By Jim Efstathiou Jr.
The House passed legislation that would protect oil-rig workers who report health or
safety concerns from retaliation by their employers.
The measure, a response to BP Plc’s Gulf of Mexico oil spill, passed 315-93. The House
today is debating a second bill that would rewrite deep-water drilling rules and tighten
safety and environmental standards.
The Gulf spill began April 20 when the Deepwater Horizon drilling rig, which BP leased
from Transocean Ltd., exploded and caught fire, killing 11 workers and causing it to sink.
The well gushed from 35,000 barrels to 60,000 barrels of oil a day before the leak was
stopped on July 15.
Investigations into the accident found that workers on the rig had worried about drilling
operations in the days leading up to the blast, said Representative Ed Markey, a
Massachusetts Democrat and chairman of the Energy and Commerce committee’s
energy and environment panel.
“We have heard that the workers aboard the rig had safety concerns, but in the end they
were powerless to stop the cascading string of bad decisions by BP that led to the
disaster,” Markey said during debate. “We are putting in place state of the art protections
for oil and gas workers who are retaliated against because they raise safety concerns.”
The bill prevents companies from firing employees who report safety violations and allows
employees to appeal perceived retaliation to the Labor secretary.
The bill is H.R. 5851.
--Editors: Steve Geimann, Larry Liebert
House Bill
July 30, 2010
Bloomberg Businessweek
By Jim Efstathiou Jr.
The House passed legislation that would protect oil-rig workers who report health or
safety concerns from retaliation by their employers.
The measure, a response to BP Plc’s Gulf of Mexico oil spill, passed 315-93. The House
today is debating a second bill that would rewrite deep-water drilling rules and tighten
safety and environmental standards.
The Gulf spill began April 20 when the Deepwater Horizon drilling rig, which BP leased
from Transocean Ltd., exploded and caught fire, killing 11 workers and causing it to sink.
The well gushed from 35,000 barrels to 60,000 barrels of oil a day before the leak was
stopped on July 15.
Investigations into the accident found that workers on the rig had worried about drilling
operations in the days leading up to the blast, said Representative Ed Markey, a
Massachusetts Democrat and chairman of the Energy and Commerce committee’s
energy and environment panel.
“We have heard that the workers aboard the rig had safety concerns, but in the end they
were powerless to stop the cascading string of bad decisions by BP that led to the
disaster,” Markey said during debate. “We are putting in place state of the art protections
for oil and gas workers who are retaliated against because they raise safety concerns.”
The bill prevents companies from firing employees who report safety violations and allows
employees to appeal perceived retaliation to the Labor secretary.
The bill is H.R. 5851.
--Editors: Steve Geimann, Larry Liebert
Target of
bullies: future
US President
Considering birthers and
other bullies, it seems that
Obama is still a favorite
target of bullies.
03/10/2011
Obama speaks out
against bullying, says, 'I
wasn't immune'
By Nia-Malika Henderson
Washington Post
President Obama and the
first lady spoke out against
bullying Thursday, urging
parents, schools and
community leaders to look
for ways to address a
problem that they say has
gotten worse in the age of
the internet and social
networking.
Joined at the White House
Conference of Bullying
Prevention by top advisers,
cabinet officials and about
150 parents, teachers and
school administrators,
Obama said that bullying,
which effects about 13
million children annually
by one estimate, is
behavior that doesn't have
to happen.
"If there's one goal of this
conference, it's to dispel
the myth that bullying is
just a harmless rite of
passage or an inevitable
part of growing up. It's
not," said Obama, who
acknowledged that he was
bullied when he was
younger.
"As adults, we all
remember what it was like
to see kids picked on in
the hallways or in the
schoolyard. And I have to
say, with big ears and the
name that I have, I wasn't
immune," he said. "I didn't
emerge unscathed. But
because it's something
that happens a lot, and it's
something that's always
been around, sometimes
we've turned a blind eye to
the problem. We've said,
'Kids will be kids.' And so
sometimes we overlook
the real damage that
bullying can do, especially
when young people face
harassment day after day,
week after week.
Obama: Bullying Not a
'Rite of Passage'
CBNNews.com
March 10, 2011
President and first lady
Obama hosted a
conference on preventing
bullying at the White
House Thursday. The
event is part of an effort to
highlight a problem that
affects millions of children
every year.
"If there's one goal, it's to
dispel the myth that
bullying is just a harmless
rite of passage," the
president said...
"As adults, we can lose
sight of how hard it can be
sometimes to be a kid,"
Obama said. "It's easy for
us to forget what it's like to
be teased or bullied, but
it's also easy to forget the
natural compassion and
the sense of decency that
our children display each
and every day when they're
given a chance."
Obama confessed that he
also had been a target of
bullying when he was a
child.
"As adults, we all
remember what it was like
to see kids picked on in
the hallways or in the
schoolyard," he said. "And
I have to say, with big ears
and the name that I have, I
wasn't immune. I didn't
emerge unscathed."
The day-long conference
will examine bullying on
college campuses as well
as at elementary and
secondary schools. It will
also focus on Internet
bullying.
The White House has set
up stopbulling.gov and a
Facebook page to promote
the campaign.
bullies: future
US President
Considering birthers and
other bullies, it seems that
Obama is still a favorite
target of bullies.
03/10/2011
Obama speaks out
against bullying, says, 'I
wasn't immune'
By Nia-Malika Henderson
Washington Post
President Obama and the
first lady spoke out against
bullying Thursday, urging
parents, schools and
community leaders to look
for ways to address a
problem that they say has
gotten worse in the age of
the internet and social
networking.
Joined at the White House
Conference of Bullying
Prevention by top advisers,
cabinet officials and about
150 parents, teachers and
school administrators,
Obama said that bullying,
which effects about 13
million children annually
by one estimate, is
behavior that doesn't have
to happen.
"If there's one goal of this
conference, it's to dispel
the myth that bullying is
just a harmless rite of
passage or an inevitable
part of growing up. It's
not," said Obama, who
acknowledged that he was
bullied when he was
younger.
"As adults, we all
remember what it was like
to see kids picked on in
the hallways or in the
schoolyard. And I have to
say, with big ears and the
name that I have, I wasn't
immune," he said. "I didn't
emerge unscathed. But
because it's something
that happens a lot, and it's
something that's always
been around, sometimes
we've turned a blind eye to
the problem. We've said,
'Kids will be kids.' And so
sometimes we overlook
the real damage that
bullying can do, especially
when young people face
harassment day after day,
week after week.
Obama: Bullying Not a
'Rite of Passage'
CBNNews.com
March 10, 2011
President and first lady
Obama hosted a
conference on preventing
bullying at the White
House Thursday. The
event is part of an effort to
highlight a problem that
affects millions of children
every year.
"If there's one goal, it's to
dispel the myth that
bullying is just a harmless
rite of passage," the
president said...
"As adults, we can lose
sight of how hard it can be
sometimes to be a kid,"
Obama said. "It's easy for
us to forget what it's like to
be teased or bullied, but
it's also easy to forget the
natural compassion and
the sense of decency that
our children display each
and every day when they're
given a chance."
Obama confessed that he
also had been a target of
bullying when he was a
child.
"As adults, we all
remember what it was like
to see kids picked on in
the hallways or in the
schoolyard," he said. "And
I have to say, with big ears
and the name that I have, I
wasn't immune. I didn't
emerge unscathed."
The day-long conference
will examine bullying on
college campuses as well
as at elementary and
secondary schools. It will
also focus on Internet
bullying.
The White House has set
up stopbulling.gov and a
Facebook page to promote
the campaign.
In the following case,
incompetent or careless
administrators promoted a
mentally ill man who killed 13 at
Fort Hood.
Army to Punish 9 Officers for
Fort Hood Shootings
Officers Not Identified by Name
or Rank
By LUIS MARTINEZ
March 10, 2011
The Army has begun
administrative punishments
against nine officers for what it
calls "administrative and
leadership failures relating to
the career of Maj. Nidal
Hasan," the alleged shooter in
the Fort Hood, Texas, shootings
that killed 13.
Army Secretary John McHugh
has initiated "adverse
administrative action" against the
officers, according to an Army
statement released Thursday on
the results of an accountability
review to determine if Hasan's
superior officers were negligent.
"Although no single event directly
led to the tragedy at Fort Hood,
certain officers clearly failed to
meet the high standards
expected of their profession," the
Army statement said.
The officers were not identified
by name or rank, and it seemed
there would not be a uniform
punishment.
"The severity of each action
varies depending on
case-specific facts and
circumstances," the statement
said.
As part of its broader
investigation into the
circumstances that led to the
November 2009 Fort Hood
shooting, the Army conducted an
accountability review of the
actions of the officers that
supervised Hasan. Unlike the
broader investigation's
conclusions, which were made
public this year, the results of the
accountability review have not
been made public -- until now.
A report by the Senate Homeland
Security and Governmental
Affairs Committee released last
month concluded that there were
warning signs about Hasan's
radicalization and antagonism to
the U.S. wars in Iraq and
Afghanistan that raised concerns
among his colleagues.
Entitled, "Ticking Time Bomb:
Fort Hood Massacre Could Have
Been Prevented," the report
cited examples of Hasan's
behavior that should have been
picked up by his supervisors.
Instead, the report found that
Hasan continued to receive
positive evaluation reports from
his supervisors that led to his
continued promotion and
eventual assignment to Fort
Hood, where he was slated to
deploy to Afghanistan.
incompetent or careless
administrators promoted a
mentally ill man who killed 13 at
Fort Hood.
Army to Punish 9 Officers for
Fort Hood Shootings
Officers Not Identified by Name
or Rank
By LUIS MARTINEZ
March 10, 2011
The Army has begun
administrative punishments
against nine officers for what it
calls "administrative and
leadership failures relating to
the career of Maj. Nidal
Hasan," the alleged shooter in
the Fort Hood, Texas, shootings
that killed 13.
Army Secretary John McHugh
has initiated "adverse
administrative action" against the
officers, according to an Army
statement released Thursday on
the results of an accountability
review to determine if Hasan's
superior officers were negligent.
"Although no single event directly
led to the tragedy at Fort Hood,
certain officers clearly failed to
meet the high standards
expected of their profession," the
Army statement said.
The officers were not identified
by name or rank, and it seemed
there would not be a uniform
punishment.
"The severity of each action
varies depending on
case-specific facts and
circumstances," the statement
said.
As part of its broader
investigation into the
circumstances that led to the
November 2009 Fort Hood
shooting, the Army conducted an
accountability review of the
actions of the officers that
supervised Hasan. Unlike the
broader investigation's
conclusions, which were made
public this year, the results of the
accountability review have not
been made public -- until now.
A report by the Senate Homeland
Security and Governmental
Affairs Committee released last
month concluded that there were
warning signs about Hasan's
radicalization and antagonism to
the U.S. wars in Iraq and
Afghanistan that raised concerns
among his colleagues.
Entitled, "Ticking Time Bomb:
Fort Hood Massacre Could Have
Been Prevented," the report
cited examples of Hasan's
behavior that should have been
picked up by his supervisors.
Instead, the report found that
Hasan continued to receive
positive evaluation reports from
his supervisors that led to his
continued promotion and
eventual assignment to Fort
Hood, where he was slated to
deploy to Afghanistan.
| How about the mentally ill? The incompetent? Often, they get promoted. |
NYTimes.com
D.E.A. Deployed Mumbai Plotter Despite Warning
By GINGER THOMPSON, ERIC SCHMITT and SOUAD MEKHENNET
November 7, 2010
WASHINGTON — American authorities sent David C. Headley, a small-time drug dealer
and sometime informant, to work for them in Pakistan months after the Sept. 11, 2001,
attacks, despite a warning that he sympathized with radical Islamic groups, according to
court records and interviews. Not long after Mr. Headley arrived there, he began training
with terrorists, eventually playing a key role in the 2008 attacks that left 164 people dead
in Mumbai.
The October 2001 warning was dismissed, the authorities said, as the ire of a jilted
girlfriend and for lack of proof. Less than a month later, those concerns did not come up
when a federal court in New York granted Mr. Headley an early release from probation so
that he could be sent to work for the United States Drug Enforcement Administration in
Pakistan. It is unclear what Mr. Headley was supposed to do in Pakistan for the
Americans.
“All I knew was the D.E.A. wanted him in Pakistan as fast as possible because they said
they were close to making some big cases,” said Luis Caso, Mr. Headley’s former
probation officer.
On Sunday, while President Obama was visiting India, he briefed Prime Minister
Manmohan Singh on the status of his administration’s investigation of Mr. Headley,
including the failure to act on repeated warnings that he might be a terrorist. A senior
United States official said the inquiry has concluded that while the government received
warnings, it did not have strong enough evidence at the time to act on them. “Had the
United States government sufficiently established he was engaged in plotting a terrorist
attack in India, the information would have most assuredly been transferred promptly to
the Indian government,” the official said in a statement to The New York Times. The
statement did not make clear whether any American agencies would be held accountable.
In recent weeks, United States government officials have begun to acknowledge that Mr.
Headley’s path from American informant to transnational terrorist illustrates the
breakdowns and miscommunications that have bedeviled them since the Sept. 11
attacks. Warnings about his radicalism were apparently not shared with the drug agency
that made use of his ties in Pakistan.
The director of national intelligence, James R. Clapper Jr., began an investigation into
Mr. Headley’s government connections after reports last month that two of the former
drug dealer’s ex-wives had gone to American authorities between 2005 and 2008, before
the Mumbai attacks, to say they feared he was plotting with terrorists. Combined with the
earlier warning from the former girlfriend, three of the women in Mr. Headley’s life
reported his ties to terrorists, only to have those warnings dismissed.
An examination of Mr. Headley’s story shows that his government ties ran far deeper and
longer than previously known. One senior American official knowledgeable about the
case said he believed that Mr. Headley was a D.E.A. informant until at least 2003,
meaning that he was talking to American agencies even as he was learning to deal with
explosives and small arms in terrorist training camps.
The review raises new questions about why the Americans missed warning signs that a
valued informant was becoming an important figure in radical Islamic groups, and
whether some officials chose to look the other way rather than believe the complaints
about him. The October 2001 warning from the girlfriend was first reported Friday by
ProPublica, the independent investigative news operation, and published in The
Washington Post.
Fuller details of how the government handled the matter were provided to The Times by
officials who did not want to be quoted discussing a continuing inquiry. They disclosed
that the F.B.I. actually talked to Mr. Headley about the girlfriend, and he told them she
was unreliable. They said that while he seemed to have a philosophical affinity for some
groups, there was no evidence that he was plotting against the United States. Also
influencing the handling of the case, they said, was that he had been a longtime
informant.
The Indian government has been outspoken in its concerns that the United States
overlooked repeated warnings about Mr. Headley’s terrorist activities because of his links
to both American law enforcement as well as to officials in Pakistan’s Inter-Services
Intelligence Directorate — a key ally of the United States in the fight against terrorism.
Bruce O. Riedel, a terrorism expert at the Brookings Institution and a former C.I.A. officer,
said the Indians were right to ask, “ ‘Why weren’t alarms screaming?’ ”
Mr. Headley, 50, born in the United States to a Pakistani diplomat and Philadelphia
socialite, has pleaded guilty in connection with the Mumbai plot and a thwarted attack
against a Danish newspaper that published cartoons of the Prophet Muhammad. As he
has many times before, he is cooperating with the authorities, this time hoping to avoid
the death penalty. Officials of the D.E.A., which has a long history with Mr. Headley,
declined to discuss their relationship with him. The C.I.A. and the F.B.I. said that Mr.
Headley had never worked with them. Privately, the agencies point fingers at each other.
D.E.A. Deployed Mumbai Plotter Despite Warning
By GINGER THOMPSON, ERIC SCHMITT and SOUAD MEKHENNET
November 7, 2010
WASHINGTON — American authorities sent David C. Headley, a small-time drug dealer
and sometime informant, to work for them in Pakistan months after the Sept. 11, 2001,
attacks, despite a warning that he sympathized with radical Islamic groups, according to
court records and interviews. Not long after Mr. Headley arrived there, he began training
with terrorists, eventually playing a key role in the 2008 attacks that left 164 people dead
in Mumbai.
The October 2001 warning was dismissed, the authorities said, as the ire of a jilted
girlfriend and for lack of proof. Less than a month later, those concerns did not come up
when a federal court in New York granted Mr. Headley an early release from probation so
that he could be sent to work for the United States Drug Enforcement Administration in
Pakistan. It is unclear what Mr. Headley was supposed to do in Pakistan for the
Americans.
“All I knew was the D.E.A. wanted him in Pakistan as fast as possible because they said
they were close to making some big cases,” said Luis Caso, Mr. Headley’s former
probation officer.
On Sunday, while President Obama was visiting India, he briefed Prime Minister
Manmohan Singh on the status of his administration’s investigation of Mr. Headley,
including the failure to act on repeated warnings that he might be a terrorist. A senior
United States official said the inquiry has concluded that while the government received
warnings, it did not have strong enough evidence at the time to act on them. “Had the
United States government sufficiently established he was engaged in plotting a terrorist
attack in India, the information would have most assuredly been transferred promptly to
the Indian government,” the official said in a statement to The New York Times. The
statement did not make clear whether any American agencies would be held accountable.
In recent weeks, United States government officials have begun to acknowledge that Mr.
Headley’s path from American informant to transnational terrorist illustrates the
breakdowns and miscommunications that have bedeviled them since the Sept. 11
attacks. Warnings about his radicalism were apparently not shared with the drug agency
that made use of his ties in Pakistan.
The director of national intelligence, James R. Clapper Jr., began an investigation into
Mr. Headley’s government connections after reports last month that two of the former
drug dealer’s ex-wives had gone to American authorities between 2005 and 2008, before
the Mumbai attacks, to say they feared he was plotting with terrorists. Combined with the
earlier warning from the former girlfriend, three of the women in Mr. Headley’s life
reported his ties to terrorists, only to have those warnings dismissed.
An examination of Mr. Headley’s story shows that his government ties ran far deeper and
longer than previously known. One senior American official knowledgeable about the
case said he believed that Mr. Headley was a D.E.A. informant until at least 2003,
meaning that he was talking to American agencies even as he was learning to deal with
explosives and small arms in terrorist training camps.
The review raises new questions about why the Americans missed warning signs that a
valued informant was becoming an important figure in radical Islamic groups, and
whether some officials chose to look the other way rather than believe the complaints
about him. The October 2001 warning from the girlfriend was first reported Friday by
ProPublica, the independent investigative news operation, and published in The
Washington Post.
Fuller details of how the government handled the matter were provided to The Times by
officials who did not want to be quoted discussing a continuing inquiry. They disclosed
that the F.B.I. actually talked to Mr. Headley about the girlfriend, and he told them she
was unreliable. They said that while he seemed to have a philosophical affinity for some
groups, there was no evidence that he was plotting against the United States. Also
influencing the handling of the case, they said, was that he had been a longtime
informant.
The Indian government has been outspoken in its concerns that the United States
overlooked repeated warnings about Mr. Headley’s terrorist activities because of his links
to both American law enforcement as well as to officials in Pakistan’s Inter-Services
Intelligence Directorate — a key ally of the United States in the fight against terrorism.
Bruce O. Riedel, a terrorism expert at the Brookings Institution and a former C.I.A. officer,
said the Indians were right to ask, “ ‘Why weren’t alarms screaming?’ ”
Mr. Headley, 50, born in the United States to a Pakistani diplomat and Philadelphia
socialite, has pleaded guilty in connection with the Mumbai plot and a thwarted attack
against a Danish newspaper that published cartoons of the Prophet Muhammad. As he
has many times before, he is cooperating with the authorities, this time hoping to avoid
the death penalty. Officials of the D.E.A., which has a long history with Mr. Headley,
declined to discuss their relationship with him. The C.I.A. and the F.B.I. said that Mr.
Headley had never worked with them. Privately, the agencies point fingers at each other.
Japanese nuclear plant’s safety analysts brushed off
risk of tsunami
By David Nakamura and Chico Harlan
March 23, 2011
A Japanese government agency that spent several years evaluating the Fukushima
Daiichi nuclear plant declared the facility safe after dismissing concerns from a
member of its own expert panel that a tsunami could jeopardize its reactors.
Yukinobu Okamura, a prominent seismologist, warned of a debilitating
tsunami in June 2009 at one of a series of meetings held by the Nuclear and
Industrial Safety Agency to evaluate the readiness of Daiichi, as well as Japan’s 16
other nuclear power plants, to withstand a massive natural disaster. But in the
discussion about Daiichi, Okamura was rebuffed by an executive from the Tokyo
Electric Power Co., which operates the plant, because the utility and the government
believed that earthquakes posed a greater threat.
That conclusion left Daiichi vulnerable to what unfolded on March 11, when a 9.0-
magnitude earthquake struck off Japan’s northeast coast. Experts now say that
Daiichi, as designed, withstood the quake. It was the ensuing tsunami, with
waves more than 20 feet high, that knocked out the facility’s critical backup
power supply and triggered a nuclear emergency, resulting in widespread releases
of radiation.
risk of tsunami
By David Nakamura and Chico Harlan
March 23, 2011
A Japanese government agency that spent several years evaluating the Fukushima
Daiichi nuclear plant declared the facility safe after dismissing concerns from a
member of its own expert panel that a tsunami could jeopardize its reactors.
Yukinobu Okamura, a prominent seismologist, warned of a debilitating
tsunami in June 2009 at one of a series of meetings held by the Nuclear and
Industrial Safety Agency to evaluate the readiness of Daiichi, as well as Japan’s 16
other nuclear power plants, to withstand a massive natural disaster. But in the
discussion about Daiichi, Okamura was rebuffed by an executive from the Tokyo
Electric Power Co., which operates the plant, because the utility and the government
believed that earthquakes posed a greater threat.
That conclusion left Daiichi vulnerable to what unfolded on March 11, when a 9.0-
magnitude earthquake struck off Japan’s northeast coast. Experts now say that
Daiichi, as designed, withstood the quake. It was the ensuing tsunami, with
waves more than 20 feet high, that knocked out the facility’s critical backup
power supply and triggered a nuclear emergency, resulting in widespread releases
of radiation.
The Apostate: Paul
Haggis vs. the
Church of
Scientology
by Lawrence Wright
February 14, 2011
The New Yorker
Asked how high he got in
Scientology’s levels of study,
Haggis said, “All the way to the
top.”
On August 19, 2009, Tommy
Davis, the chief spokesperson
for the Church of Scientology
International, received a letter
from the film director and
screenwriter Paul Haggis. “For
ten months now I have been
writing to ask you to make a
public statement denouncing
the actions of the Church of
Scientology of San Diego,”
Haggis wrote. Before the 2008
elections, a staff member at
Scientology’s San Diego church
had signed its name to an
online petition supporting
Proposition 8, which asserted
that the State of California
should sanction marriage only
“between a man and a woman.”
The proposition passed. As
Haggis saw it, the San Diego
church’s “public sponsorship of
Proposition 8, which succeeded
in taking away the civil rights of
gay and lesbian citizens of
California—rights that were
granted them by the Supreme
Court of our state—is a stain on
the integrity of our organization
and a stain on us personally.
Our public association with that
hate-filled legislation shames
us.” Haggis wrote, “Silence is
consent, Tommy. I refuse to
consent.” He concluded, “I
hereby resign my membership
in the Church of Scientology.”
Haggis was prominent in both
Scientology and Hollywood, two
communities that often
converge. Although he is less
famous than certain other
Scientologists, such as Tom
Cruise and John Travolta, he
had been in the organization for
nearly thirty-five years. Haggis
wrote the screenplay for
“Million Dollar Baby,” which
won the Oscar for Best
Picture in 2004, and he
wrote and directed “Crash,”
which won Best Picture the
next year—the only time in
Academy history that that has
happened.
Davis, too, is part of
Hollywood society; his
mother is Anne Archer, who
starred in “Fatal Attraction”
and “Patriot Games,” among
other films. Before becoming
Scientology’s spokesperson,
Davis was a senior vice-
president of the church’s
Celebrity Centre International
network.
In previous correspondence
with Davis, Haggis had
demanded that the church
publicly renounce Proposition 8.
“I feel strongly about this for a
number of reasons,” he wrote.
“You and I both know there has
been a hidden anti-gay
sentiment in the church for a
long time. I have been shocked
on too many occasions to hear
Scientologists make derogatory
remarks about gay people, and
then quote L.R.H. in their
defense.” The initials stand for
L. Ron Hubbard, the founder of
Scientology, whose extensive
writings and lectures form the
church’s scripture.
Haggis related a story about
Katy, the youngest of three
daughters from his first
marriage, who lost the
friendship of a fellow-
Scientologist after revealing
that she was gay. The friend
began warning others, “Katy is
‘1.1.’ ” The number refers to
a sliding Tone Scale of
emotional states that
Hubbard published in a 1951
book, “The Science of
Survival.” A person
classified “1.1” was,
Hubbard said, “Covertly
Hostile”—“the most
dangerous and wicked level”
—and he noted that people in
this state engaged in such
things as casual sex, sadism,
and homosexual activity.
Hubbard’s Tone Scale, Haggis
wrote, equated “homosexuality
with being a pervert.” (Such
remarks don’t appear in recent
editions of the book.)
In his resignation letter, Haggis
explained to Davis that, for
the first time, he had
explored outside
perspectives on
Scientology. He had read a
recent exposé in a Florida
newspaper, the St.
Petersburg Times, which
reported, among other
things, that senior
executives in the church
had been subjecting other
Scientologists to physical
violence. Haggis said that
he felt “dumbstruck and
horrified,” adding, “Tommy,
if only a fraction of these
accusations are true, we are
talking about serious,
indefensible human and
civil-rights violations.”
Online, Haggis came across an
appearance that Davis had
made on CNN, in May, 2008.
The anchor John Roberts
asked Davis about the church’s
policy of “disconnection,” in
which members are encouraged
to separate themselves from
friends or family members who
criticize Scientology. Davis
responded, “There’s no
such thing as disconnection
as you’re characterizing it.
And certainly we have to
understand—”
“Well, what is
disconnection?” Roberts
interjected.
“Scientology is a new religion,”
Davis continued. “The majority
of Scientologists in the world,
they’re first generation. So their
family members aren’t going to
be Scientologists. . . . So,
certainly, someone who is a
Scientologist is going to respect
their family members’ beliefs—”
“Well, what is
disconnection?” Roberts
said again.
“—and we consider family to be
a building block of any society,
so anything that’s characterized
as disconnection or this kind of
thing, it’s just not true. There
isn’t any such policy.”
In his resignation letter, Haggis
said, “We all know this policy
exists. I didn’t have to
search for verification—I
didn’t have to look any
further than my own home.”
Haggis reminded Davis that,
a few years earlier, his wife
had been ordered to
disconnect from her parents
“because of something
absolutely trivial they
supposedly did twenty-five
years ago when they
resigned from the church. . .
. Although it caused her
terrible personal pain, my
wife broke off all contact
with them.” Haggis
continued, “To see you lie
so easily, I am afraid I had to
ask myself: what else are
you lying about?”
Haggis forwarded his
resignation to more than twenty
Scientologist friends, including
Anne Archer, John Travolta,
and Sky Dayton, the founder of
EarthLink. “I felt if I sent it to my
friends they’d be as horrified as
I was, and they’d ask questions
as well,” he says. “That turned
out to be largely not the case.
They were horrified that I’d
send a letter like that.”
Haggis vs. the
Church of
Scientology
by Lawrence Wright
February 14, 2011
The New Yorker
Asked how high he got in
Scientology’s levels of study,
Haggis said, “All the way to the
top.”
On August 19, 2009, Tommy
Davis, the chief spokesperson
for the Church of Scientology
International, received a letter
from the film director and
screenwriter Paul Haggis. “For
ten months now I have been
writing to ask you to make a
public statement denouncing
the actions of the Church of
Scientology of San Diego,”
Haggis wrote. Before the 2008
elections, a staff member at
Scientology’s San Diego church
had signed its name to an
online petition supporting
Proposition 8, which asserted
that the State of California
should sanction marriage only
“between a man and a woman.”
The proposition passed. As
Haggis saw it, the San Diego
church’s “public sponsorship of
Proposition 8, which succeeded
in taking away the civil rights of
gay and lesbian citizens of
California—rights that were
granted them by the Supreme
Court of our state—is a stain on
the integrity of our organization
and a stain on us personally.
Our public association with that
hate-filled legislation shames
us.” Haggis wrote, “Silence is
consent, Tommy. I refuse to
consent.” He concluded, “I
hereby resign my membership
in the Church of Scientology.”
Haggis was prominent in both
Scientology and Hollywood, two
communities that often
converge. Although he is less
famous than certain other
Scientologists, such as Tom
Cruise and John Travolta, he
had been in the organization for
nearly thirty-five years. Haggis
wrote the screenplay for
“Million Dollar Baby,” which
won the Oscar for Best
Picture in 2004, and he
wrote and directed “Crash,”
which won Best Picture the
next year—the only time in
Academy history that that has
happened.
Davis, too, is part of
Hollywood society; his
mother is Anne Archer, who
starred in “Fatal Attraction”
and “Patriot Games,” among
other films. Before becoming
Scientology’s spokesperson,
Davis was a senior vice-
president of the church’s
Celebrity Centre International
network.
In previous correspondence
with Davis, Haggis had
demanded that the church
publicly renounce Proposition 8.
“I feel strongly about this for a
number of reasons,” he wrote.
“You and I both know there has
been a hidden anti-gay
sentiment in the church for a
long time. I have been shocked
on too many occasions to hear
Scientologists make derogatory
remarks about gay people, and
then quote L.R.H. in their
defense.” The initials stand for
L. Ron Hubbard, the founder of
Scientology, whose extensive
writings and lectures form the
church’s scripture.
Haggis related a story about
Katy, the youngest of three
daughters from his first
marriage, who lost the
friendship of a fellow-
Scientologist after revealing
that she was gay. The friend
began warning others, “Katy is
‘1.1.’ ” The number refers to
a sliding Tone Scale of
emotional states that
Hubbard published in a 1951
book, “The Science of
Survival.” A person
classified “1.1” was,
Hubbard said, “Covertly
Hostile”—“the most
dangerous and wicked level”
—and he noted that people in
this state engaged in such
things as casual sex, sadism,
and homosexual activity.
Hubbard’s Tone Scale, Haggis
wrote, equated “homosexuality
with being a pervert.” (Such
remarks don’t appear in recent
editions of the book.)
In his resignation letter, Haggis
explained to Davis that, for
the first time, he had
explored outside
perspectives on
Scientology. He had read a
recent exposé in a Florida
newspaper, the St.
Petersburg Times, which
reported, among other
things, that senior
executives in the church
had been subjecting other
Scientologists to physical
violence. Haggis said that
he felt “dumbstruck and
horrified,” adding, “Tommy,
if only a fraction of these
accusations are true, we are
talking about serious,
indefensible human and
civil-rights violations.”
Online, Haggis came across an
appearance that Davis had
made on CNN, in May, 2008.
The anchor John Roberts
asked Davis about the church’s
policy of “disconnection,” in
which members are encouraged
to separate themselves from
friends or family members who
criticize Scientology. Davis
responded, “There’s no
such thing as disconnection
as you’re characterizing it.
And certainly we have to
understand—”
“Well, what is
disconnection?” Roberts
interjected.
“Scientology is a new religion,”
Davis continued. “The majority
of Scientologists in the world,
they’re first generation. So their
family members aren’t going to
be Scientologists. . . . So,
certainly, someone who is a
Scientologist is going to respect
their family members’ beliefs—”
“Well, what is
disconnection?” Roberts
said again.
“—and we consider family to be
a building block of any society,
so anything that’s characterized
as disconnection or this kind of
thing, it’s just not true. There
isn’t any such policy.”
In his resignation letter, Haggis
said, “We all know this policy
exists. I didn’t have to
search for verification—I
didn’t have to look any
further than my own home.”
Haggis reminded Davis that,
a few years earlier, his wife
had been ordered to
disconnect from her parents
“because of something
absolutely trivial they
supposedly did twenty-five
years ago when they
resigned from the church. . .
. Although it caused her
terrible personal pain, my
wife broke off all contact
with them.” Haggis
continued, “To see you lie
so easily, I am afraid I had to
ask myself: what else are
you lying about?”
Haggis forwarded his
resignation to more than twenty
Scientologist friends, including
Anne Archer, John Travolta,
and Sky Dayton, the founder of
EarthLink. “I felt if I sent it to my
friends they’d be as horrified as
I was, and they’d ask questions
as well,” he says. “That turned
out to be largely not the case.
They were horrified that I’d
send a letter like that.”
"Martin Woods, a Liverpudlian in his mid-40s, joined the London office of Wachovia
Bank in February 2005 as a senior anti-money laundering officer."
How a big US bank laundered billions from Mexico's
murderous drug gangs
As the violence spread, billions of dollars of cartel cash began to seep into the global
financial system. But a special investigation by the Observer reveals how the
increasingly frantic warnings of one London whistleblower were ignored
The Observer
3 April 2011
On 10 April 2006, a DC-9 jet landed in the port city of Ciudad del Carmen, on the Gulf
of Mexico, as the sun was setting. Mexican soldiers, waiting to intercept it, found 128
cases packed with 5.7 tons of cocaine, valued at $100m. But something else – more
important and far-reaching – was discovered in the paper trail behind the purchase of
the plane by the Sinaloa narco-trafficking cartel.
During a 22-month investigation by agents from the US Drug Enforcement
Administration, the Internal Revenue Service and others, it emerged that the cocaine
smugglers had bought the plane with money they had laundered through one of the
biggest banks in the United States: Wachovia, now part of the giant Wells Fargo.
The authorities uncovered billions of dollars in wire transfers, traveller's cheques and
cash shipments through Mexican exchanges into Wachovia accounts. Wachovia was
put under immediate investigation for failing to maintain an effective anti-money
laundering programme. Of special significance was that the period concerned began
in 2004, which coincided with the first escalation of violence along the US-Mexico
border that ignited the current drugs war.
Criminal proceedings were brought against Wachovia, though not against any
individual, but the case never came to court. In March 2010, Wachovia settled the
biggest action brought under the US bank secrecy act, through the US district court in
Miami. Now that the year's "deferred prosecution" has expired, the bank is in effect in
the clear. It paid federal authorities $110m in forfeiture, for allowing transactions later
proved to be connected to drug smuggling, and incurred a $50m fine for failing to
monitor cash used to ship 22 tons of cocaine.
More shocking, and more important, the bank was sanctioned for failing to apply the
proper anti-laundering strictures to the transfer of $378.4bn – a sum equivalent to
one-third of Mexico's gross national product – into dollar accounts from so-called
casas de cambio (CDCs) in Mexico, currency exchange houses with which the bank
did business.
"Wachovia's blatant disregard for our banking laws gave international
cocaine cartels a virtual carte blanche to finance their operations," said
Jeffrey Sloman, the federal prosecutor. Yet the total fine was less than 2% of
the bank's $12.3bn profit for 2009. On 24 March 2010, Wells Fargo stock
traded at $30.86 – up 1% on the week of the court settlement.
The conclusion to the case was only the tip of an iceberg, demonstrating the role of
the "legal" banking sector in swilling hundreds of billions of dollars – the
blood money from the murderous drug trade in Mexico and other places in
the world – around their global operations, now bailed out by the taxpayer.
At the height of the 2008 banking crisis, Antonio Maria Costa, then head of the
United Nations office on drugs and crime, said he had evidence to suggest
the proceeds from drugs and crime were "the only liquid investment capital"
available to banks on the brink of collapse. "Inter-bank loans were funded by
money that originated from the drugs trade," he said. "There were signs that some
banks were rescued that way."...
During research into the Wachovia Mexican case, the Observer obtained documents
previously provided to financial regulators. It emerged that the alarm that was ignored
came from, among other places, London, as a result of the diligence of one of the
most important whistleblowers of our time. A man who, in a series of interviews with the
Observer, adds detail to the documents, laying bare the story of how Wachovia was at
the centre of one of the world's biggest money-laundering operations.
Martin Woods, a Liverpudlian in his mid-40s, joined the London office of
Wachovia Bank in February 2005 as a senior anti-money laundering officer.
He had previously served with the Metropolitan police drug squad. As a detective he
joined the money-laundering investigation team of the National Crime Squad, where
he worked on the British end of the Bank of New York money-laundering scandal in
the late 1990s.
Woods talks like a police officer – in the best sense of the word: punctilious, exact,
with a roguish humour, but moral at the core. He was an ideal appointment for any
bank eager to operate a diligent and effective risk management policy
against the lucrative scourge of high finance: laundering, knowing or
otherwise, the vast proceeds of criminality, tax-evasion, and dealing in arms
and drugs.
Woods had a police officer's eye and a police officer's instincts – not those of
a banker. And this influenced not only his methods, but his mentality. "I think
that a lot of things matter more than money – and that marks you out in a culture
which appears to prevail in many of the banks in the world," he says.
Woods was set apart by his modus operandi. His speciality, he explains, was his
application of a "know your client", or KYC, policing strategy to identifying dirty money.
"KYC is a fundamental approach to anti-money laundering, going after tax evasion or
counter-terrorist financing. Who are your clients? Is the documentation right? Good,
responsible banking involved always knowing your customer and it still does."
When he looked at Wachovia, the first thing Woods noticed was a deficiency in KYC
information. And among his first reports to his superiors at the bank's headquarters in
Charlotte, North Carolina, were observations on a shortfall in KYC at Wachovia's
operation in London, which he set about correcting, while at the same time
implementing what was known as an enhanced transaction monitoring programme,
gathering more information on clients whose money came through the bank's offices
in the City, in sterling or euros. By August 2006, Woods had identified a number
of suspicious transactions relating to casas de cambio customers in Mexico.
Primarily, these involved deposits of traveller's cheques in euros. They had sequential
numbers and deposited larger amounts of money than any innocent travelling person
would need, with inadequate or no KYC information on them and what seemed to a
trained eye to be dubious signatures. "It was basic work," he says. "They didn't
answer the obvious questions: 'Is the transaction real, or does it look synthetic? Does
the traveller's cheque meet the protocols? Is it all there, and if not, why not?'"
Woods discussed the matter with Wachovia's global head of anti-money
laundering for correspondent banking, who believed the cheques could
signify tax evasion. He then undertook what banks call a "look back" at
previous transactions and saw fit to submit a series of SARs, or suspicious
activity reports, to the authorities in the UK and his superiors in Charlotte,
urging the blocking of named parties and large series of sequentially
numbered traveller's cheques from Mexico. He issued a number of SARs in
2006, of which 50 related to the casas de cambio in Mexico.
To his amazement, the response from Wachovia's Miami office, the centre for
Latin American business, was anything but supportive – he felt it was quite
the reverse.
As it turned out, however, Woods was on the right track. Wachovia's business
in Mexico was coming under closer and closer scrutiny by US federal law enforcement.
Wachovia was issued with a number of subpoenas for information on its Mexican
operation. Woods has subsequently been informed that Wachovia had six or seven
thousand subpoenas. He says this was "An absurd number. So at what point does
someone at the highest level not get the feeling that something is very, very wrong?"
In April and May 2007, Wachovia – as a result of increasing interest and pressure
from the US attorney's office – began to close its relationship with some of the casas
de cambio. But rather than launch an internal investigation into Woods's alerts over
Mexico, Woods claims Wachovia hung its own money-laundering expert out to dry.
The records show that during 2007 Woods "continued to submit more SARs related to
the casas de cambio".
In July 2007, all of Wachovia's remaining 10 Mexican casa de cambio clients operating
through London suddenly stopped doing so. Later in 2007, after the investigation of
Wachovia was reported in the US financial media, the bank decided to end its
remaining relationships with the Mexican casas de cambio globally. By this time,
Woods says, he found his personal situation within the bank untenable; while
the bank acted on one level to protect itself from the federal investigation
into its shortcomings, on another, it rounded on the man who had been
among the first to spot them.
On 16 June Woods was told by Wachovia's head of compliance that his latest
SAR need not have been filed, that he had no legal requirement to
investigate an overseas case and no right of access to documents held
overseas from Britain, even if they were held by Wachovia.
Woods's life went into freefall. He went to hospital with a prolapsed disc,
reported sick and was told by the bank that he not done so in the appropriate
manner, as directed by the employees' handbook. He was off work for three
weeks, returning in August 2007 to find a letter from the bank's compliance
managing director, which was unrelenting in its tone and words of warning.
The letter addressed itself to what the manager called "specific examples of
your failure to perform at an acceptable standard". Woods, on the edge of a
breakdown, was put on sick leave by his GP; he was later given psychiatric
treatment, enrolled on a stress management course and put on medication.
Late in 2007, Woods attended a function at Scotland Yard where colleagues from the
US were being entertained. There, he sought out a representative of the Drug
Enforcement Administration and told him about the casas de cambio, the SARs and
his employer's reaction. The Federal Reserve and officials of the office of comptroller
of currency in Washington DC then "spent a lot of time examining the SARs" that had
been sent by Woods to Charlotte from London.
"They got back in touch with me a while afterwards and we began to put the pieces of
the jigsaw together," says Woods. What they found was – as Costa says – the tip of
the iceberg of what was happening to drug money in the banking industry, but at least
it was visible and it had a name: Wachovia...
After years of tribulation, Woods was finally formally vindicated, though not
by Wachovia: a letter arrived from John Dugan, the comptroller of the currency in
Washington DC, dated 19 March 2010 – three days after the settlement in Miami.
Dugan said he was "writing to personally recognise and express my appreciation for
the role you played in the actions brought against Wachovia Bank for violations of the
bank secrecy act … Not only did the information that you provided facilitate our
investigation, but you demonstrated great personal courage and integrity by
speaking up. Without the efforts of individuals like you, actions such as the
one taken against Wachovia would not be possible."
The so-called "deferred prosecution" detailed in the Miami document is a form of
probation whereby if the bank abides by the law for a year, charges are dropped. So
this March the bank was in the clear. The week that the deferred prosecution expired,
a spokeswoman for Wells Fargo said the parent bank had no comment to make on
the documentation pertaining to Woods's case, or his allegations. She added that
there was no comment on Sloman's remarks to the court; a provision in the settlement
stipulated Wachovia was not allowed to issue public statements that contradicted it.
But the settlement leaves a sour taste in many mouths – and certainly in Woods's.
The deferred prosecution is part of this "cop-out all round", he says. "The regulatory
authorities do not have to spend any more time on it, and they don't have to push it as
far as a criminal trial. They just issue criminal proceedings, and settle. The law
enforcement people do what they are supposed to do, but what's the point? All those
people dealing with all that money from drug-trafficking and murder, and no one goes
to jail?"
One of the foremost figures in the training of anti-money laundering officers
is Robert Mazur, lead infiltrator for US law enforcement of the Colombian
Medellín cartel during the epic prosecution and collapse of the BCCI banking
business in 1991 (his story was made famous by his memoir, The Infiltrator, which
became a movie).
Mazur, whose firm Chase and Associates works closely with law enforcement agencies
and trains officers for bank anti-money laundering, cast a keen eye over the case
against Wachovia, and he says now that "the only thing that will make the banks
properly vigilant to what is happening is when they hear the rattle of
handcuffs in the boardroom".
Mazur said that "a lot of the law enforcement people were disappointed to see a
settlement" between the administration and Wachovia. "But I know there were external
circumstances that worked to Wachovia's benefit, not least that the US banking
system was on the edge of collapse."...
Antonio Maria Costa, who was executive director of the UN's office on drugs
and crime from May 2002 to August 2010, charts the history of the contamination
of the global banking industry by drug and criminal money since his first initiatives to
try to curb it from the European commission during the 1990s. "The connection
between organised crime and financial institutions started in the late 1970s, early
1980s," he says, "when the mafia became globalised."...
"With these crises," says Costa, "the banking sector was short of liquidity, the
banks exposed themselves to the criminal syndicates, who had cash in
hand."
Costa questions the readiness of governments and their regulatory
structures to challenge this large-scale corruption of the global economy:
"Government regulators showed what they were capable of when the issue
suddenly changed to laundering money for terrorism – on that, they suddenly
became serious and changed their attitude."
Hardly surprising, then, that Wachovia does not appear to be the end of the line. In
August 2010, it emerged in quarterly disclosures by HSBC that the US justice
department was seeking to fine it for anti-money laundering compliance problems
reported to include dealings with Mexico.
"Wachovia had my résumé, they knew who I was," says Woods. "But they did
not want to know – their attitude was, 'Why are you doing this?' They should
have been on my side, because they were compliance people, not commercial people.
But really they were commercial people all along. We're talking about hundreds of
millions of dollars. This is the biggest money-laundering scandal of our time.
"These are the proceeds of murder and misery in Mexico, and of drugs sold around
the world," he says...
Bank in February 2005 as a senior anti-money laundering officer."
How a big US bank laundered billions from Mexico's
murderous drug gangs
As the violence spread, billions of dollars of cartel cash began to seep into the global
financial system. But a special investigation by the Observer reveals how the
increasingly frantic warnings of one London whistleblower were ignored
The Observer
3 April 2011
On 10 April 2006, a DC-9 jet landed in the port city of Ciudad del Carmen, on the Gulf
of Mexico, as the sun was setting. Mexican soldiers, waiting to intercept it, found 128
cases packed with 5.7 tons of cocaine, valued at $100m. But something else – more
important and far-reaching – was discovered in the paper trail behind the purchase of
the plane by the Sinaloa narco-trafficking cartel.
During a 22-month investigation by agents from the US Drug Enforcement
Administration, the Internal Revenue Service and others, it emerged that the cocaine
smugglers had bought the plane with money they had laundered through one of the
biggest banks in the United States: Wachovia, now part of the giant Wells Fargo.
The authorities uncovered billions of dollars in wire transfers, traveller's cheques and
cash shipments through Mexican exchanges into Wachovia accounts. Wachovia was
put under immediate investigation for failing to maintain an effective anti-money
laundering programme. Of special significance was that the period concerned began
in 2004, which coincided with the first escalation of violence along the US-Mexico
border that ignited the current drugs war.
Criminal proceedings were brought against Wachovia, though not against any
individual, but the case never came to court. In March 2010, Wachovia settled the
biggest action brought under the US bank secrecy act, through the US district court in
Miami. Now that the year's "deferred prosecution" has expired, the bank is in effect in
the clear. It paid federal authorities $110m in forfeiture, for allowing transactions later
proved to be connected to drug smuggling, and incurred a $50m fine for failing to
monitor cash used to ship 22 tons of cocaine.
More shocking, and more important, the bank was sanctioned for failing to apply the
proper anti-laundering strictures to the transfer of $378.4bn – a sum equivalent to
one-third of Mexico's gross national product – into dollar accounts from so-called
casas de cambio (CDCs) in Mexico, currency exchange houses with which the bank
did business.
"Wachovia's blatant disregard for our banking laws gave international
cocaine cartels a virtual carte blanche to finance their operations," said
Jeffrey Sloman, the federal prosecutor. Yet the total fine was less than 2% of
the bank's $12.3bn profit for 2009. On 24 March 2010, Wells Fargo stock
traded at $30.86 – up 1% on the week of the court settlement.
The conclusion to the case was only the tip of an iceberg, demonstrating the role of
the "legal" banking sector in swilling hundreds of billions of dollars – the
blood money from the murderous drug trade in Mexico and other places in
the world – around their global operations, now bailed out by the taxpayer.
At the height of the 2008 banking crisis, Antonio Maria Costa, then head of the
United Nations office on drugs and crime, said he had evidence to suggest
the proceeds from drugs and crime were "the only liquid investment capital"
available to banks on the brink of collapse. "Inter-bank loans were funded by
money that originated from the drugs trade," he said. "There were signs that some
banks were rescued that way."...
During research into the Wachovia Mexican case, the Observer obtained documents
previously provided to financial regulators. It emerged that the alarm that was ignored
came from, among other places, London, as a result of the diligence of one of the
most important whistleblowers of our time. A man who, in a series of interviews with the
Observer, adds detail to the documents, laying bare the story of how Wachovia was at
the centre of one of the world's biggest money-laundering operations.
Martin Woods, a Liverpudlian in his mid-40s, joined the London office of
Wachovia Bank in February 2005 as a senior anti-money laundering officer.
He had previously served with the Metropolitan police drug squad. As a detective he
joined the money-laundering investigation team of the National Crime Squad, where
he worked on the British end of the Bank of New York money-laundering scandal in
the late 1990s.
Woods talks like a police officer – in the best sense of the word: punctilious, exact,
with a roguish humour, but moral at the core. He was an ideal appointment for any
bank eager to operate a diligent and effective risk management policy
against the lucrative scourge of high finance: laundering, knowing or
otherwise, the vast proceeds of criminality, tax-evasion, and dealing in arms
and drugs.
Woods had a police officer's eye and a police officer's instincts – not those of
a banker. And this influenced not only his methods, but his mentality. "I think
that a lot of things matter more than money – and that marks you out in a culture
which appears to prevail in many of the banks in the world," he says.
Woods was set apart by his modus operandi. His speciality, he explains, was his
application of a "know your client", or KYC, policing strategy to identifying dirty money.
"KYC is a fundamental approach to anti-money laundering, going after tax evasion or
counter-terrorist financing. Who are your clients? Is the documentation right? Good,
responsible banking involved always knowing your customer and it still does."
When he looked at Wachovia, the first thing Woods noticed was a deficiency in KYC
information. And among his first reports to his superiors at the bank's headquarters in
Charlotte, North Carolina, were observations on a shortfall in KYC at Wachovia's
operation in London, which he set about correcting, while at the same time
implementing what was known as an enhanced transaction monitoring programme,
gathering more information on clients whose money came through the bank's offices
in the City, in sterling or euros. By August 2006, Woods had identified a number
of suspicious transactions relating to casas de cambio customers in Mexico.
Primarily, these involved deposits of traveller's cheques in euros. They had sequential
numbers and deposited larger amounts of money than any innocent travelling person
would need, with inadequate or no KYC information on them and what seemed to a
trained eye to be dubious signatures. "It was basic work," he says. "They didn't
answer the obvious questions: 'Is the transaction real, or does it look synthetic? Does
the traveller's cheque meet the protocols? Is it all there, and if not, why not?'"
Woods discussed the matter with Wachovia's global head of anti-money
laundering for correspondent banking, who believed the cheques could
signify tax evasion. He then undertook what banks call a "look back" at
previous transactions and saw fit to submit a series of SARs, or suspicious
activity reports, to the authorities in the UK and his superiors in Charlotte,
urging the blocking of named parties and large series of sequentially
numbered traveller's cheques from Mexico. He issued a number of SARs in
2006, of which 50 related to the casas de cambio in Mexico.
To his amazement, the response from Wachovia's Miami office, the centre for
Latin American business, was anything but supportive – he felt it was quite
the reverse.
As it turned out, however, Woods was on the right track. Wachovia's business
in Mexico was coming under closer and closer scrutiny by US federal law enforcement.
Wachovia was issued with a number of subpoenas for information on its Mexican
operation. Woods has subsequently been informed that Wachovia had six or seven
thousand subpoenas. He says this was "An absurd number. So at what point does
someone at the highest level not get the feeling that something is very, very wrong?"
In April and May 2007, Wachovia – as a result of increasing interest and pressure
from the US attorney's office – began to close its relationship with some of the casas
de cambio. But rather than launch an internal investigation into Woods's alerts over
Mexico, Woods claims Wachovia hung its own money-laundering expert out to dry.
The records show that during 2007 Woods "continued to submit more SARs related to
the casas de cambio".
In July 2007, all of Wachovia's remaining 10 Mexican casa de cambio clients operating
through London suddenly stopped doing so. Later in 2007, after the investigation of
Wachovia was reported in the US financial media, the bank decided to end its
remaining relationships with the Mexican casas de cambio globally. By this time,
Woods says, he found his personal situation within the bank untenable; while
the bank acted on one level to protect itself from the federal investigation
into its shortcomings, on another, it rounded on the man who had been
among the first to spot them.
On 16 June Woods was told by Wachovia's head of compliance that his latest
SAR need not have been filed, that he had no legal requirement to
investigate an overseas case and no right of access to documents held
overseas from Britain, even if they were held by Wachovia.
Woods's life went into freefall. He went to hospital with a prolapsed disc,
reported sick and was told by the bank that he not done so in the appropriate
manner, as directed by the employees' handbook. He was off work for three
weeks, returning in August 2007 to find a letter from the bank's compliance
managing director, which was unrelenting in its tone and words of warning.
The letter addressed itself to what the manager called "specific examples of
your failure to perform at an acceptable standard". Woods, on the edge of a
breakdown, was put on sick leave by his GP; he was later given psychiatric
treatment, enrolled on a stress management course and put on medication.
Late in 2007, Woods attended a function at Scotland Yard where colleagues from the
US were being entertained. There, he sought out a representative of the Drug
Enforcement Administration and told him about the casas de cambio, the SARs and
his employer's reaction. The Federal Reserve and officials of the office of comptroller
of currency in Washington DC then "spent a lot of time examining the SARs" that had
been sent by Woods to Charlotte from London.
"They got back in touch with me a while afterwards and we began to put the pieces of
the jigsaw together," says Woods. What they found was – as Costa says – the tip of
the iceberg of what was happening to drug money in the banking industry, but at least
it was visible and it had a name: Wachovia...
After years of tribulation, Woods was finally formally vindicated, though not
by Wachovia: a letter arrived from John Dugan, the comptroller of the currency in
Washington DC, dated 19 March 2010 – three days after the settlement in Miami.
Dugan said he was "writing to personally recognise and express my appreciation for
the role you played in the actions brought against Wachovia Bank for violations of the
bank secrecy act … Not only did the information that you provided facilitate our
investigation, but you demonstrated great personal courage and integrity by
speaking up. Without the efforts of individuals like you, actions such as the
one taken against Wachovia would not be possible."
The so-called "deferred prosecution" detailed in the Miami document is a form of
probation whereby if the bank abides by the law for a year, charges are dropped. So
this March the bank was in the clear. The week that the deferred prosecution expired,
a spokeswoman for Wells Fargo said the parent bank had no comment to make on
the documentation pertaining to Woods's case, or his allegations. She added that
there was no comment on Sloman's remarks to the court; a provision in the settlement
stipulated Wachovia was not allowed to issue public statements that contradicted it.
But the settlement leaves a sour taste in many mouths – and certainly in Woods's.
The deferred prosecution is part of this "cop-out all round", he says. "The regulatory
authorities do not have to spend any more time on it, and they don't have to push it as
far as a criminal trial. They just issue criminal proceedings, and settle. The law
enforcement people do what they are supposed to do, but what's the point? All those
people dealing with all that money from drug-trafficking and murder, and no one goes
to jail?"
One of the foremost figures in the training of anti-money laundering officers
is Robert Mazur, lead infiltrator for US law enforcement of the Colombian
Medellín cartel during the epic prosecution and collapse of the BCCI banking
business in 1991 (his story was made famous by his memoir, The Infiltrator, which
became a movie).
Mazur, whose firm Chase and Associates works closely with law enforcement agencies
and trains officers for bank anti-money laundering, cast a keen eye over the case
against Wachovia, and he says now that "the only thing that will make the banks
properly vigilant to what is happening is when they hear the rattle of
handcuffs in the boardroom".
Mazur said that "a lot of the law enforcement people were disappointed to see a
settlement" between the administration and Wachovia. "But I know there were external
circumstances that worked to Wachovia's benefit, not least that the US banking
system was on the edge of collapse."...
Antonio Maria Costa, who was executive director of the UN's office on drugs
and crime from May 2002 to August 2010, charts the history of the contamination
of the global banking industry by drug and criminal money since his first initiatives to
try to curb it from the European commission during the 1990s. "The connection
between organised crime and financial institutions started in the late 1970s, early
1980s," he says, "when the mafia became globalised."...
"With these crises," says Costa, "the banking sector was short of liquidity, the
banks exposed themselves to the criminal syndicates, who had cash in
hand."
Costa questions the readiness of governments and their regulatory
structures to challenge this large-scale corruption of the global economy:
"Government regulators showed what they were capable of when the issue
suddenly changed to laundering money for terrorism – on that, they suddenly
became serious and changed their attitude."
Hardly surprising, then, that Wachovia does not appear to be the end of the line. In
August 2010, it emerged in quarterly disclosures by HSBC that the US justice
department was seeking to fine it for anti-money laundering compliance problems
reported to include dealings with Mexico.
"Wachovia had my résumé, they knew who I was," says Woods. "But they did
not want to know – their attitude was, 'Why are you doing this?' They should
have been on my side, because they were compliance people, not commercial people.
But really they were commercial people all along. We're talking about hundreds of
millions of dollars. This is the biggest money-laundering scandal of our time.
"These are the proceeds of murder and misery in Mexico, and of drugs sold around
the world," he says...
Obama's whistleblower war suffers two defeats
By Glenn Greenwald
(updated below: w/reaction from Jim Risen)
Salon.com
Jul 30, 2011
The Obama administration's unprecedented war on whistleblowers suffered two serious and
well-deserved defeats. The first occurred in the prosecution of NSA whistleblower Thomas
Drake, who was accused of multiple acts of espionage, only for the DOJ to drop virtually all
of the charges right before the trial was to begin and enter into a plea agreement for one
minor misdemeanor. Today, The Washington Post -- under the headline "Judge blasts
prosecution of alleged NSA leaker" -- reports that the federal judge presiding over the case
"harshly criticized U.S. prosecutors’ treatment of a former spy agency official accused of
leaking classified material."
As the transcript of Drake's sentencing hearing published by Secrecy News reflects, Judge
Richard Bennett of the U.S. District Court for Maryland was infuriated by two aspects of the
DOJ's conduct: (1) after the Bush DOJ executed a search warrant of Drake's home in 2007,
the Obama DOJ -- 2 1/2 years later -- finally indicted him, meaning he had to live with that
cloud of criminal uncertainty over his head for that outrageously lengthy period of time; and
(2) despite dropping all of the serious charges right before the trial was about to begin, the
DOJ demanded that Drake be forced to pay a $50,000 fine as "a deterrent" (on top of the
tens of thousands of dollars he spent in legal fees until he had no money left and had to use
public defenders, as well as the fact that he was five years away from earning a federal
pension when he was fired and ended up working at an Apple Computer store to support his
family); to justify the requested fine, the prosecutor cited a $10,000 whistleblowing prize
Drake was awarded earlier this year.
As for the first issue, the court condemned what it called the "extraordinary position taken by
the government, probably unprecedented in this courthouse" of dropping the whole case on
the eve of trial after "an extraordinary period of delay." Judge Bennett added: "I find that
unconscionable. Unconscionable. It is at the very root of what this country was founded on
against general warrants of the British." As for the second issue, the court reviewed the
difficult circumstances of Drake's childhood (he was raised in poverty and sent himself to
school with risky military service), his complete lack of any prior criminal record, and -- most
of all -- the multiple ways in which the failed prosecution destroyed his life ("the financial
devastation wrought upon this defendant"), and flatly refused to impose any fine at all,
explaining: "I'm not going to add to that in any way."
What is most notable about this hearing is that the prosecutor candidly described not only
his reasons for wanting a substantial fine imposed on Drake, but (without his saying so) also
the motive for the Obama DOJ's broader war on whistleblowers: namely, an attempt to send
a "message" of intimidation to future would-be whistleblowers (click on image to enlarge):
Yet Judge Bennett -- who, as a Bush 43 appointee, is presumably not overly sympathetic
either to criminal defendants generally or national security leaks in particular -- was having
none of that. He first explained that he had never seen prosecutorial delays as extreme as
the one in this case (accounted for by the fact that the Bush DOJ had apparently decided
not to prosecute Drake, but the Obama DOJ then proceeded):
Judge Bennett then eloquently explained that the DOJ already destroyed Drake's life, even
though it ended up convicting him of nothing other than a minor misdemeanor:
That, of course, is the real point here. Drake's leak involved no conceivable harm to
national security, but did expose serious waste, corruption and possible illegality. ..
By Glenn Greenwald
(updated below: w/reaction from Jim Risen)
Salon.com
Jul 30, 2011
The Obama administration's unprecedented war on whistleblowers suffered two serious and
well-deserved defeats. The first occurred in the prosecution of NSA whistleblower Thomas
Drake, who was accused of multiple acts of espionage, only for the DOJ to drop virtually all
of the charges right before the trial was to begin and enter into a plea agreement for one
minor misdemeanor. Today, The Washington Post -- under the headline "Judge blasts
prosecution of alleged NSA leaker" -- reports that the federal judge presiding over the case
"harshly criticized U.S. prosecutors’ treatment of a former spy agency official accused of
leaking classified material."
As the transcript of Drake's sentencing hearing published by Secrecy News reflects, Judge
Richard Bennett of the U.S. District Court for Maryland was infuriated by two aspects of the
DOJ's conduct: (1) after the Bush DOJ executed a search warrant of Drake's home in 2007,
the Obama DOJ -- 2 1/2 years later -- finally indicted him, meaning he had to live with that
cloud of criminal uncertainty over his head for that outrageously lengthy period of time; and
(2) despite dropping all of the serious charges right before the trial was about to begin, the
DOJ demanded that Drake be forced to pay a $50,000 fine as "a deterrent" (on top of the
tens of thousands of dollars he spent in legal fees until he had no money left and had to use
public defenders, as well as the fact that he was five years away from earning a federal
pension when he was fired and ended up working at an Apple Computer store to support his
family); to justify the requested fine, the prosecutor cited a $10,000 whistleblowing prize
Drake was awarded earlier this year.
As for the first issue, the court condemned what it called the "extraordinary position taken by
the government, probably unprecedented in this courthouse" of dropping the whole case on
the eve of trial after "an extraordinary period of delay." Judge Bennett added: "I find that
unconscionable. Unconscionable. It is at the very root of what this country was founded on
against general warrants of the British." As for the second issue, the court reviewed the
difficult circumstances of Drake's childhood (he was raised in poverty and sent himself to
school with risky military service), his complete lack of any prior criminal record, and -- most
of all -- the multiple ways in which the failed prosecution destroyed his life ("the financial
devastation wrought upon this defendant"), and flatly refused to impose any fine at all,
explaining: "I'm not going to add to that in any way."
What is most notable about this hearing is that the prosecutor candidly described not only
his reasons for wanting a substantial fine imposed on Drake, but (without his saying so) also
the motive for the Obama DOJ's broader war on whistleblowers: namely, an attempt to send
a "message" of intimidation to future would-be whistleblowers (click on image to enlarge):
Yet Judge Bennett -- who, as a Bush 43 appointee, is presumably not overly sympathetic
either to criminal defendants generally or national security leaks in particular -- was having
none of that. He first explained that he had never seen prosecutorial delays as extreme as
the one in this case (accounted for by the fact that the Bush DOJ had apparently decided
not to prosecute Drake, but the Obama DOJ then proceeded):
Judge Bennett then eloquently explained that the DOJ already destroyed Drake's life, even
though it ended up convicting him of nothing other than a minor misdemeanor:
That, of course, is the real point here. Drake's leak involved no conceivable harm to
national security, but did expose serious waste, corruption and possible illegality. ..
Is the government reimbursing companies facing legal
actions by whistleblowers?
By Joe Davidson
Washington Post
December 21, 2011
Remember the story about Walt Tamosaitis, the federal contractor consigned to a
basement office after detailing safety and technical issues with the Energy Department’s
Hanford Waste Treatment Plant in southeastern Washington state?
This month, when he told a Senate subcommittee about the troubles his whistleblowing
generated, he said that Bechtel Corp., the prime contractor on the nuclear waste job, was
being reimbursed by Energy for the company’s defense against legal action by
Tamosaitis.
At the hearing, he said he “learned that in the [Department of Energy] contracting world,
the legal costs incurred by the companies are reimbursed by the DOE. Since this is
taxpayer money, I began to feel that I was battling myself. It is unclear to me that if a
company loses a retaliation case, whether they have to pay DOE back for the funds they
received. Further complicating it, if the company chooses to settle but admits no guilt, it
appears they do not have to pay DOE back for any of the legal costs. I felt like everything
was stacked to support the companies.”
This raises an important question. Should the federal government pay to defend a
company against whistleblowers whose actions might well be in the best interests of
taxpayers?
The inquiring mind of Sen. Claire McCaskill (D-Mo.) wants to know.
On Tuesday, she sent a letter to the department’s National Nuclear Security
Administration (NNSA) to determine if what Tamosaitis said about reimbursement is
correct.
If his allegation is true, “this raises serious concerns,” she wrote to Thomas P. D’Agostino,
the department’s undersecretary for nuclear security and NNSA administrator.
“The federal government relies on whistleblowers to report information about waste,
fraud, abuse, and mismanagement of taxpayer dollars and has mandated whistleblower
protections, including protections for employees of contractors of the National Nuclear
Security Administration (NNSA), to ensure that employees are not retaliated against for
their disclosures. Reimbursing a contractor’s legal costs for defending against these
types of claims appears to contravene these policies.”
She told the agency to let her know how much it has paid to defend companies against
Tamosaitis’s claims. The department said no final decision on reimbursement has been
made.
A Bechtel statement says its agreement with the department “includes a standard contract
provision for reimbursement of legal expenses. DOE’s final determination on the
allowability of costs in the Tamosaitis matter will occur after the case is resolved. The
criteria for reimbursement afforded to BNI [Bechtel National Inc.] does not differ from that
of other DOE contractors and is not unique to the WTP [Waste Treatment Plant] contract.”
Energy’s practice of reimbursing contractors to defend the companies against
whistleblowers, however, is not the norm in the federal government.
“DOE’s financial cushion for contractors to fight whistleblower lawsuits is unique, in GAP’s
experience,” said Tom Devine, legal director of the Government Accountability Project, a
nonprofit whistleblower advocacy organization. “The practice is so outrageous that in the
2005 Energy Policy Act, Congress passed a law requiring re-payment when there is a
judgment against the contractor in whistleblower cases.”
actions by whistleblowers?
By Joe Davidson
Washington Post
December 21, 2011
Remember the story about Walt Tamosaitis, the federal contractor consigned to a
basement office after detailing safety and technical issues with the Energy Department’s
Hanford Waste Treatment Plant in southeastern Washington state?
This month, when he told a Senate subcommittee about the troubles his whistleblowing
generated, he said that Bechtel Corp., the prime contractor on the nuclear waste job, was
being reimbursed by Energy for the company’s defense against legal action by
Tamosaitis.
At the hearing, he said he “learned that in the [Department of Energy] contracting world,
the legal costs incurred by the companies are reimbursed by the DOE. Since this is
taxpayer money, I began to feel that I was battling myself. It is unclear to me that if a
company loses a retaliation case, whether they have to pay DOE back for the funds they
received. Further complicating it, if the company chooses to settle but admits no guilt, it
appears they do not have to pay DOE back for any of the legal costs. I felt like everything
was stacked to support the companies.”
This raises an important question. Should the federal government pay to defend a
company against whistleblowers whose actions might well be in the best interests of
taxpayers?
The inquiring mind of Sen. Claire McCaskill (D-Mo.) wants to know.
On Tuesday, she sent a letter to the department’s National Nuclear Security
Administration (NNSA) to determine if what Tamosaitis said about reimbursement is
correct.
If his allegation is true, “this raises serious concerns,” she wrote to Thomas P. D’Agostino,
the department’s undersecretary for nuclear security and NNSA administrator.
“The federal government relies on whistleblowers to report information about waste,
fraud, abuse, and mismanagement of taxpayer dollars and has mandated whistleblower
protections, including protections for employees of contractors of the National Nuclear
Security Administration (NNSA), to ensure that employees are not retaliated against for
their disclosures. Reimbursing a contractor’s legal costs for defending against these
types of claims appears to contravene these policies.”
She told the agency to let her know how much it has paid to defend companies against
Tamosaitis’s claims. The department said no final decision on reimbursement has been
made.
A Bechtel statement says its agreement with the department “includes a standard contract
provision for reimbursement of legal expenses. DOE’s final determination on the
allowability of costs in the Tamosaitis matter will occur after the case is resolved. The
criteria for reimbursement afforded to BNI [Bechtel National Inc.] does not differ from that
of other DOE contractors and is not unique to the WTP [Waste Treatment Plant] contract.”
Energy’s practice of reimbursing contractors to defend the companies against
whistleblowers, however, is not the norm in the federal government.
“DOE’s financial cushion for contractors to fight whistleblower lawsuits is unique, in GAP’s
experience,” said Tom Devine, legal director of the Government Accountability Project, a
nonprofit whistleblower advocacy organization. “The practice is so outrageous that in the
2005 Energy Policy Act, Congress passed a law requiring re-payment when there is a
judgment against the contractor in whistleblower cases.”
Mayo Clinic ordered to reinstate whistleblower
News8000.com
Feb 15 2012
ROCHESTER, Minn. (AP) -- Mayo Clinic says it will appeal an order from a federal
administrative law judge to reinstate an employee who complained about the safety of the
clinic's vehicles.
The Department of Labor judge ruled Mayo unlawfully discriminated against courier
James Seehusen, who had complained about a broken windshield on a vehicle and said
the clinic failed to do required daily inspections of certain vehicles. Seehusen also said
drivers didn't have proper certification to operate the clinic's shuttle bus.
Mayo said Wednesday it took immediate action to address the employee's concerns and
that his discipline and suspension were unrelated to his complaints. The Post-Bulletin
reports the judge ruled Mayo failed to prove that the discipline would have happened
regardless of Seehusen's safety complaints.
News8000.com
Feb 15 2012
ROCHESTER, Minn. (AP) -- Mayo Clinic says it will appeal an order from a federal
administrative law judge to reinstate an employee who complained about the safety of the
clinic's vehicles.
The Department of Labor judge ruled Mayo unlawfully discriminated against courier
James Seehusen, who had complained about a broken windshield on a vehicle and said
the clinic failed to do required daily inspections of certain vehicles. Seehusen also said
drivers didn't have proper certification to operate the clinic's shuttle bus.
Mayo said Wednesday it took immediate action to address the employee's concerns and
that his discipline and suspension were unrelated to his complaints. The Post-Bulletin
reports the judge ruled Mayo failed to prove that the discipline would have happened
regardless of Seehusen's safety complaints.
| San Diego Education Report |
| SDER |
San Diego
Education Report
Education Report
| SDER |
| SDER |
| SDER |
"It’s not the first time that the education service district has settled a whistleblower lawsuit
filed against a former teacher. In 2010, the district settled a lawsuit for $45,000 with
Maggie Vogenbeck in which the former teacher claimed state and federal discrimination,
whistleblower retaliation and wrongful discharge."
WESD finalizes $150,000 settlement for whistleblower claim
Queenie Wong
Statesman Journal
Nov. 1, 2013
WESD board members in state ethics probe
A laid off Willamette Education Service District teacher and her lawyer will get $150,000
as part of a settlement to a whistleblower lawsuit filed against the district three years ago.
Former teacher Terri Moore claimed she lost her job because she repeatedly reported
safety violations at the high school at Hillcrest Youth Correctional Facility and filed a
formal complaint about harassment and bullying by Bill Conlon, the school’s principal.
She filed a lawsuit in Marion County Circuit Court in 2010 asking for as much as
$500,000, plus attorney fees and reinstatement as a full-time teacher.
Under the settlement, Moore will get $86,355.75 and the law firm representing her —
Lafky and Lafky — will receive $63,644.25.
She won’t be entitled to return as a full-time employee at WESD, but still could work as a
substitute teacher, according to the agreement.
WESD’s liability carrier, the Special Districts Association of Oregon, decided to settle the
lawsuit because of the costs of going to trial last month.
The district’s board chairman Ken Hector said in a statement Friday he understood the
carrier’s decision to settle the case.
“Choosing to move forward to defend the case at trial would burden WESD with all
attorney fees and costs, impacting our general fund,” Hector said. “The ultimate outcome
of resolution for this case is best for WESD and the districts we serve.”
Moore taught health and physical education at WESD’s youth correction education
programs but was laid off in 2009 after 11 years with the district.
WESD has denied the allegations brought by Moore, noting that they have been
thoroughly investigated and found to be without merit. The district’s settlement signed by
Moore is not an admission of wrongdoing or liability.
Moore’s lawyer, Kevin Lafky, said it’s clear Moore was retaliated against. She wanted to
get her old job back; because that did not happen, they decided settling was the best
thing for her to get some sort of compensation for the retaliation.
“The money she’s getting paid certainly doesn’t make up for losing a full-time job with
benefits,” Lafky said. “For years, she’s been working as a substitute teacher to make
ends meet since she was terminated from WESD.”
It’s not the first time that the education service district has
settled a whistleblower lawsuit filed against a former teacher.
In 2010, the district settled a lawsuit for $45,000 with Maggie
Vogenbeck in which the former teacher claimed state and
federal discrimination, whistleblower retaliation and wrongful
discharge.
WESD provides education services such as special education, home school registration
and professional development to 17 school districts in Marion, Polk and Yamhill counties,
according to its website.
Reporter Tracy Loew contributed to this story.
filed against a former teacher. In 2010, the district settled a lawsuit for $45,000 with
Maggie Vogenbeck in which the former teacher claimed state and federal discrimination,
whistleblower retaliation and wrongful discharge."
WESD finalizes $150,000 settlement for whistleblower claim
Queenie Wong
Statesman Journal
Nov. 1, 2013
WESD board members in state ethics probe
A laid off Willamette Education Service District teacher and her lawyer will get $150,000
as part of a settlement to a whistleblower lawsuit filed against the district three years ago.
Former teacher Terri Moore claimed she lost her job because she repeatedly reported
safety violations at the high school at Hillcrest Youth Correctional Facility and filed a
formal complaint about harassment and bullying by Bill Conlon, the school’s principal.
She filed a lawsuit in Marion County Circuit Court in 2010 asking for as much as
$500,000, plus attorney fees and reinstatement as a full-time teacher.
Under the settlement, Moore will get $86,355.75 and the law firm representing her —
Lafky and Lafky — will receive $63,644.25.
She won’t be entitled to return as a full-time employee at WESD, but still could work as a
substitute teacher, according to the agreement.
WESD’s liability carrier, the Special Districts Association of Oregon, decided to settle the
lawsuit because of the costs of going to trial last month.
The district’s board chairman Ken Hector said in a statement Friday he understood the
carrier’s decision to settle the case.
“Choosing to move forward to defend the case at trial would burden WESD with all
attorney fees and costs, impacting our general fund,” Hector said. “The ultimate outcome
of resolution for this case is best for WESD and the districts we serve.”
Moore taught health and physical education at WESD’s youth correction education
programs but was laid off in 2009 after 11 years with the district.
WESD has denied the allegations brought by Moore, noting that they have been
thoroughly investigated and found to be without merit. The district’s settlement signed by
Moore is not an admission of wrongdoing or liability.
Moore’s lawyer, Kevin Lafky, said it’s clear Moore was retaliated against. She wanted to
get her old job back; because that did not happen, they decided settling was the best
thing for her to get some sort of compensation for the retaliation.
“The money she’s getting paid certainly doesn’t make up for losing a full-time job with
benefits,” Lafky said. “For years, she’s been working as a substitute teacher to make
ends meet since she was terminated from WESD.”
It’s not the first time that the education service district has
settled a whistleblower lawsuit filed against a former teacher.
In 2010, the district settled a lawsuit for $45,000 with Maggie
Vogenbeck in which the former teacher claimed state and
federal discrimination, whistleblower retaliation and wrongful
discharge.
WESD provides education services such as special education, home school registration
and professional development to 17 school districts in Marion, Polk and Yamhill counties,
according to its website.
Reporter Tracy Loew contributed to this story.
Blog posts re incompetence
The $9 Billion Witness: Meet JPMorgan Chase's Worst
Nightmare
By Matt Taibbi
November 6, 2014
...Fleischmann is the central witness in one of the biggest cases of white-collar crime in
American history, possessing secrets that JPMorgan Chase CEO Jamie Dimon late last year
paid $9 billion (not $13 billion as regularly reported – more on that later) to keep the public from
hearing.
Back in 2006, as a deal manager at the gigantic bank, Fleischmann first witnessed, then tried to
stop, what she describes as "massive criminal securities fraud" in the bank's mortgage
operations.
Thanks to a confidentiality agreement, she's kept her mouth shut since then. "My closest family
and friends don't know what I've been living with," she says. "Even my brother will only find out
for the first time when he sees this interview."
Six years after the crisis that cratered the global economy, it's not exactly news that the
country's biggest banks stole on a grand scale. That's why the more important part of
Fleischmann's story is in the pains Chase and the Justice Department took to silence her.
She was blocked at every turn: by asleep-on-the-job regulators like the Securities and
Exchange Commission, by a court system that allowed Chase to use its billions to bury her
evidence, and, finally, by officials like outgoing Attorney General Eric Holder, the chief architect
of the crazily elaborate government policy of surrender, secrecy and cover-up. "Every time I
had a chance to talk, something always got in the way," Fleischmann says.
This past year she watched as Holder's Justice Department struck a series of historic
settlement deals with Chase, Citigroup and Bank of America. The root bargain in these deals
was cash for secrecy. The banks paid big fines, without trials or even judges – only secret
negotiations that typically ended with the public shown nothing but vague, quasi-official papers
called "statements of facts," which were conveniently devoid of anything like actual facts...
A few months into her tenure, Fleischmann would later testify in a DOJ deposition, the bank
hired a new manager for diligence, the group in charge of reviewing and clearing loans.
Fleischmann quickly ran into a problem with this manager, technically one of her superiors.
She says he told her and other employees to stop sending him e-mails. The
department, it seemed, was wary of putting anything in writing when it came to its
mortgage deals."...
Nightmare
By Matt Taibbi
November 6, 2014
...Fleischmann is the central witness in one of the biggest cases of white-collar crime in
American history, possessing secrets that JPMorgan Chase CEO Jamie Dimon late last year
paid $9 billion (not $13 billion as regularly reported – more on that later) to keep the public from
hearing.
Back in 2006, as a deal manager at the gigantic bank, Fleischmann first witnessed, then tried to
stop, what she describes as "massive criminal securities fraud" in the bank's mortgage
operations.
Thanks to a confidentiality agreement, she's kept her mouth shut since then. "My closest family
and friends don't know what I've been living with," she says. "Even my brother will only find out
for the first time when he sees this interview."
Six years after the crisis that cratered the global economy, it's not exactly news that the
country's biggest banks stole on a grand scale. That's why the more important part of
Fleischmann's story is in the pains Chase and the Justice Department took to silence her.
She was blocked at every turn: by asleep-on-the-job regulators like the Securities and
Exchange Commission, by a court system that allowed Chase to use its billions to bury her
evidence, and, finally, by officials like outgoing Attorney General Eric Holder, the chief architect
of the crazily elaborate government policy of surrender, secrecy and cover-up. "Every time I
had a chance to talk, something always got in the way," Fleischmann says.
This past year she watched as Holder's Justice Department struck a series of historic
settlement deals with Chase, Citigroup and Bank of America. The root bargain in these deals
was cash for secrecy. The banks paid big fines, without trials or even judges – only secret
negotiations that typically ended with the public shown nothing but vague, quasi-official papers
called "statements of facts," which were conveniently devoid of anything like actual facts...
A few months into her tenure, Fleischmann would later testify in a DOJ deposition, the bank
hired a new manager for diligence, the group in charge of reviewing and clearing loans.
Fleischmann quickly ran into a problem with this manager, technically one of her superiors.
She says he told her and other employees to stop sending him e-mails. The
department, it seemed, was wary of putting anything in writing when it came to its
mortgage deals."...
Jul 17, 2015
Cheney's Halliburton killing babies. Where are the pro-life
rallies?
Carissa Miller
A fracking well in Colorado, pictured in 2012
Rolling Stone's article What's Killing the Babies of Vernal, Utah? by Paul Solotaroff covers the
story of Donna Young, the primary midwife in Vernal, Utah, that noticed a recent rise in stillborns
in her rural town. The town, state, oil companies and many residents don't want to know the
reason for the uptick in birth defects, stillborns and general rise in respiratory issues.
In most places, detecting a grave risk to children would inspire people to name a street for you.
But in Vernal, a town literally built by oil, raising questions about the safety of fracking will brand
you a traitor and a target.
Which is exactly what has happened to Young. She has been made a villain and the town
continues to celebrate oil at every major holiday. And while reading the incredible article—which
clearly outlines the real villains: W, Cheney, legislation written by oil barrens, and the giddy-
because-US-oil-production-is-higher-than-oil-imports Obama administration—all I could think was
where are all the pro-life rallies? This is Utah!
Where are the hell-bent on redemption preachers and bible thumpin', baby lovin' soldiers for
Christ, with their signs equipped with high-resolution pictures of the fetuses that are being
exposed to life-threatening pollution, the stillborn babies that are resulting. ...
So this is my formal request of the pro-life crowd: Could you start fighting for regulations on the
corporations that are killing expectant mothers' babies instead of standing in the way of women
making healthcare decisions for themselves?
Cheney's Halliburton killing babies. Where are the pro-life
rallies?
Carissa Miller
A fracking well in Colorado, pictured in 2012
Rolling Stone's article What's Killing the Babies of Vernal, Utah? by Paul Solotaroff covers the
story of Donna Young, the primary midwife in Vernal, Utah, that noticed a recent rise in stillborns
in her rural town. The town, state, oil companies and many residents don't want to know the
reason for the uptick in birth defects, stillborns and general rise in respiratory issues.
In most places, detecting a grave risk to children would inspire people to name a street for you.
But in Vernal, a town literally built by oil, raising questions about the safety of fracking will brand
you a traitor and a target.
Which is exactly what has happened to Young. She has been made a villain and the town
continues to celebrate oil at every major holiday. And while reading the incredible article—which
clearly outlines the real villains: W, Cheney, legislation written by oil barrens, and the giddy-
because-US-oil-production-is-higher-than-oil-imports Obama administration—all I could think was
where are all the pro-life rallies? This is Utah!
Where are the hell-bent on redemption preachers and bible thumpin', baby lovin' soldiers for
Christ, with their signs equipped with high-resolution pictures of the fetuses that are being
exposed to life-threatening pollution, the stillborn babies that are resulting. ...
So this is my formal request of the pro-life crowd: Could you start fighting for regulations on the
corporations that are killing expectant mothers' babies instead of standing in the way of women
making healthcare decisions for themselves?
Getting rid of the best cops
KING: A former Marine was fired as a W.Va. police officer after
failing to shoot somebody
Shaun King
NEW YORK DAILY NEWS
September 13, 2016
On July 24, 2015, the Weirton, W.Va., Police Department announced the hiring of three
new officers for the force. All three men were celebrated for bringing some much
needed youth to an aging department in the sleepy rural city 35 miles outside of
Pittsburgh.
Zach Springer was just 20. Adam Mortimer was 21. And the old head among them was
Stephen Mader, who was 24.
Maybe they knew it. Maybe they didn't. But Stephen Mader was a find, a gem, a
blessing for that little department. Even though he was just 24 when they hired him,
Stephen Mader was already a bonafide hero — one of the good guys. Mader had spent
four years in the Marines.
In the announcement that he was hired by the Weirton Police Department, I noticed that
it said Mader was a Marine. I took a chance and Googled "Stephen Mader Marines" and
immediately found several stories of a Marine named Stephen Mader who served in
Helmand Province in Afghanistan. A special report was done on him and his amazing
explosive-sniffing dog, Maxx. This Stephen Mader joined the Marines in 2009 and
became an improvised explosive device dog handler with the 3rd Battalion, 8th Marines,
Regimental Combat Team 6.
KING: Where's all the outrage when white men kill police?
I couldn't verify for sure if it was the same man. It definitely looked like him. Then I
searched his name on Facebook and there he was — Stephen Mader from Weirton,
West Virginia, a Marine, with his trusted dog Maxx. It was him — except now, Mader is
no longer a police officer. He got fired.
While his hiring made the local news there in Weirton, his termination has gone national.
Bad police officers are known for keeping their jobs in spite of brutality, corruption,
harassment and even murder. The Chicago Police Department has hundreds of officers
with 20 or more brutality complaints. Daniel Pantaleo, the NYPD officer who used a
deadly chokehold on Eric Garner, not only avoided prosecution, but has kept his job
and received raises and overtime pay over the past two years. He's somehow bringing
in a salary two to three times the average schoolteacher in spite of his actions in
Garner's death, as well as costing New York City in several other lawsuits before that.
It's a rare thing to see a police officer get fired. When it happens, it's normally for two
reasons — they've committed a crime that they will likely be found guilty of or they are
bucking the system somehow and have seriously pissed off their bosses.
KING: Police officers, local prosecutors are two of a kind
In the case of Stephen Mader, he committed no crime. What he did do, though, was so
compassionate and counter-cultural in the day and age where police so often shoot first
and ask questions later, that his actions threatened to disturb the status quo.
By the time Stephen Mader suited up with a gun and a badge for Weirton, he had not
only been trained for several years on how to safely and accurately assess life and
death threats, he had actually done the work in a war zone as a Marine. His very job
was to safely and carefully identify IED's in Afghanistan so that they could be disarmed
without harming our troops or the communities they were in. By definition, particularly
because he did this work alongside Maxx, the specially trained 4-year-old Labrador,
who would feed off his energy, Mader had the gift of calmness.
So, after serving nearly a year on his local police force, when Stephen Mader was
dispatched to the home of a suicidal man on May 6, he did so with the precision and
patience he had become known for.
Ronald "RJ" Williams, Jr, a 23-year-old black man and young father, was suicidal.
Stephen Mader, the Marine turned cop, was a 24-year-old white man, and a young
father himself. When Mader arrived on the scene, he did exactly what every activist and
advocate for safer policing has begged officers all over the nation to do — he took his
time and saw Williams as a human being. The Pittsburgh Post Gazette described the
scene:
KING: Cops must record statements right after each use of force
Stephen Mader had spent four years in the Marines.
Stephen Mader had spent four years in the Marines. (WTOV)
Immediately, the training he had undergone as a Marine to look at "the whole person" in
deciding if someone was a terrorist, as well as his situational police academy training,
kicked in and he did not shoot.
"I saw then he had a gun, but it was not pointed at me," Mr. Mader recalled, noting the
silver handgun was in the man's right hand, hanging at his side and pointed at the
ground.
Mr. Mader, who was standing behind Mr. Williams' car parked on the street, said he
then "began to use my calm voice."
"I told him, 'Put down the gun,' and he's like, 'Just shoot me.' And I told him, 'I'm not
going to shoot you brother.' Then he starts flicking his wrist to get me to react to it.
"I thought I was going to be able to talk to him and deescalate it. I knew it was a suicide-
by-cop" situation.
While Mader says he was trying to deescalate the situation, two more cops arrived and
shot R.J. Williams dead as he allegedly walked toward them, waving his gun. The gun
he had was unloaded. What he needed was help. What he needed was a man who
knew how to assess a problem and bring in skilled support to resolve it. Stephen Mader
was that man, but this is America, not Afghanistan. Here, our police don't give a damn
about your depression or suicidal tendencies or your young children or your future. If
they deem you a threat, you're dead.
The shooting remains under investigation by the West Virginia Civil Liberties Union, as
well was Williams' family.
Eleven days after the shooting, when Mader returned to work, he was reportedly told by
Police Chief Rob Alexander and City Manager Travis Blosser that he was being placed
on administrative leave while they completed an investigation to "see if you are going to
be an officer here. You put two other officers in danger."
Three weeks later, Stephen Mader received his termination letter. In it, it said he was
fired because he "failed to eliminate a threat."
Except R.J. Williams was not an actual threat to anyone. And even if he had been,
Mader had the training, skill, and experience to expertly handle the situation. It's highly
doubtful that the cops who shot and killed Williams had ever been under the pressures
that Mader faced with grace in Afghanistan.
At a time when bad cops seem harder to get rid of than corruption and greed on Wall
Street, that an American war hero was fired for trying to save a man's life is America in
a nutshell right now.
To prevent from having the blemish on his record, Mader was advised to resign in
silence, but he's not that type of guy. He refused — as he should have.
"To resign and admit I did something wrong here would have ate at me," he told the
Post-Gazette. "I think I'm right in what I did. I'll take it to the grave."
Here's to hoping that Stephen Mader has a long life in law enforcement somewhere
else. We need men like him on our streets.
KING: A former Marine was fired as a W.Va. police officer after
failing to shoot somebody
Shaun King
NEW YORK DAILY NEWS
September 13, 2016
On July 24, 2015, the Weirton, W.Va., Police Department announced the hiring of three
new officers for the force. All three men were celebrated for bringing some much
needed youth to an aging department in the sleepy rural city 35 miles outside of
Pittsburgh.
Zach Springer was just 20. Adam Mortimer was 21. And the old head among them was
Stephen Mader, who was 24.
Maybe they knew it. Maybe they didn't. But Stephen Mader was a find, a gem, a
blessing for that little department. Even though he was just 24 when they hired him,
Stephen Mader was already a bonafide hero — one of the good guys. Mader had spent
four years in the Marines.
In the announcement that he was hired by the Weirton Police Department, I noticed that
it said Mader was a Marine. I took a chance and Googled "Stephen Mader Marines" and
immediately found several stories of a Marine named Stephen Mader who served in
Helmand Province in Afghanistan. A special report was done on him and his amazing
explosive-sniffing dog, Maxx. This Stephen Mader joined the Marines in 2009 and
became an improvised explosive device dog handler with the 3rd Battalion, 8th Marines,
Regimental Combat Team 6.
KING: Where's all the outrage when white men kill police?
I couldn't verify for sure if it was the same man. It definitely looked like him. Then I
searched his name on Facebook and there he was — Stephen Mader from Weirton,
West Virginia, a Marine, with his trusted dog Maxx. It was him — except now, Mader is
no longer a police officer. He got fired.
While his hiring made the local news there in Weirton, his termination has gone national.
Bad police officers are known for keeping their jobs in spite of brutality, corruption,
harassment and even murder. The Chicago Police Department has hundreds of officers
with 20 or more brutality complaints. Daniel Pantaleo, the NYPD officer who used a
deadly chokehold on Eric Garner, not only avoided prosecution, but has kept his job
and received raises and overtime pay over the past two years. He's somehow bringing
in a salary two to three times the average schoolteacher in spite of his actions in
Garner's death, as well as costing New York City in several other lawsuits before that.
It's a rare thing to see a police officer get fired. When it happens, it's normally for two
reasons — they've committed a crime that they will likely be found guilty of or they are
bucking the system somehow and have seriously pissed off their bosses.
KING: Police officers, local prosecutors are two of a kind
In the case of Stephen Mader, he committed no crime. What he did do, though, was so
compassionate and counter-cultural in the day and age where police so often shoot first
and ask questions later, that his actions threatened to disturb the status quo.
By the time Stephen Mader suited up with a gun and a badge for Weirton, he had not
only been trained for several years on how to safely and accurately assess life and
death threats, he had actually done the work in a war zone as a Marine. His very job
was to safely and carefully identify IED's in Afghanistan so that they could be disarmed
without harming our troops or the communities they were in. By definition, particularly
because he did this work alongside Maxx, the specially trained 4-year-old Labrador,
who would feed off his energy, Mader had the gift of calmness.
So, after serving nearly a year on his local police force, when Stephen Mader was
dispatched to the home of a suicidal man on May 6, he did so with the precision and
patience he had become known for.
Ronald "RJ" Williams, Jr, a 23-year-old black man and young father, was suicidal.
Stephen Mader, the Marine turned cop, was a 24-year-old white man, and a young
father himself. When Mader arrived on the scene, he did exactly what every activist and
advocate for safer policing has begged officers all over the nation to do — he took his
time and saw Williams as a human being. The Pittsburgh Post Gazette described the
scene:
KING: Cops must record statements right after each use of force
Stephen Mader had spent four years in the Marines.
Stephen Mader had spent four years in the Marines. (WTOV)
Immediately, the training he had undergone as a Marine to look at "the whole person" in
deciding if someone was a terrorist, as well as his situational police academy training,
kicked in and he did not shoot.
"I saw then he had a gun, but it was not pointed at me," Mr. Mader recalled, noting the
silver handgun was in the man's right hand, hanging at his side and pointed at the
ground.
Mr. Mader, who was standing behind Mr. Williams' car parked on the street, said he
then "began to use my calm voice."
"I told him, 'Put down the gun,' and he's like, 'Just shoot me.' And I told him, 'I'm not
going to shoot you brother.' Then he starts flicking his wrist to get me to react to it.
"I thought I was going to be able to talk to him and deescalate it. I knew it was a suicide-
by-cop" situation.
While Mader says he was trying to deescalate the situation, two more cops arrived and
shot R.J. Williams dead as he allegedly walked toward them, waving his gun. The gun
he had was unloaded. What he needed was help. What he needed was a man who
knew how to assess a problem and bring in skilled support to resolve it. Stephen Mader
was that man, but this is America, not Afghanistan. Here, our police don't give a damn
about your depression or suicidal tendencies or your young children or your future. If
they deem you a threat, you're dead.
The shooting remains under investigation by the West Virginia Civil Liberties Union, as
well was Williams' family.
Eleven days after the shooting, when Mader returned to work, he was reportedly told by
Police Chief Rob Alexander and City Manager Travis Blosser that he was being placed
on administrative leave while they completed an investigation to "see if you are going to
be an officer here. You put two other officers in danger."
Three weeks later, Stephen Mader received his termination letter. In it, it said he was
fired because he "failed to eliminate a threat."
Except R.J. Williams was not an actual threat to anyone. And even if he had been,
Mader had the training, skill, and experience to expertly handle the situation. It's highly
doubtful that the cops who shot and killed Williams had ever been under the pressures
that Mader faced with grace in Afghanistan.
At a time when bad cops seem harder to get rid of than corruption and greed on Wall
Street, that an American war hero was fired for trying to save a man's life is America in
a nutshell right now.
To prevent from having the blemish on his record, Mader was advised to resign in
silence, but he's not that type of guy. He refused — as he should have.
"To resign and admit I did something wrong here would have ate at me," he told the
Post-Gazette. "I think I'm right in what I did. I'll take it to the grave."
Here's to hoping that Stephen Mader has a long life in law enforcement somewhere
else. We need men like him on our streets.
| News, information and ideas about our education system by Maura Larkins |
See also medical whistle-blowers
RPT-Wells Fargo complaints show flaws in federal whistleblower
program
Reuters
Oct. 14, 2016
By Sarah N. Lynch
WASHINGTON, Oct 13 (Reuters) - Former Wells Fargo & Co general manager Claudia
Ponce de Leon filed a whistleblower complaint in December 2011 with federal labor
regulators, alleging she was fired for telling superiors about employees opening
unauthorized accounts.
Nearly five years later, she has not been interviewed by investigators at the Labor
Department's Occupational Safety and Health Administration (OSHA), said her attorney
Yosef Peretz.
Her complaint claiming retaliation by Wells Fargo for reporting potential misconduct is one
of several dozens filed against the bank over the last 14 years, Reuters has found.
Their existence shows U.S. government regulators are still not meeting targets set by law --
a problem that was also flagged in a critical internal report issued in September 2015.
As of Oct. 6, the agency had yet to close out 34 of the 91 complaints it has received since
fiscal year 2002 from Wells Fargo employees alleging they faced retaliation after reporting
potential wrongdoing, according to department data obtained through a Reuters public
records request.
The department did not disclose details of the claims or the dates they were filed, and it
remained unclear how many were related to the ongoing scandal involving Wells staffers
opening as many as 2 million accounts without customer permission. It is also unclear how
those 91 complaints against Wells Fargo compares with other corporations.
The bank last month agreed to pay $190 million in fines and customer restitution in a
settlement with the Consumer Finance Protection Bureau and other regulators.
In late September, Reuters identified Ponce de Leon and at least four other former Wells
Fargo employees who reported to OSHA between 2009 and 2014 that they were fired for
raising concerns about the opening of unauthorized accounts and credit cards. Of the five
OSHA complaints seen by Reuters, Ponce de Leon's case has been pending since
December 2011, and another 2014 case was initially dismissed by an OSHA investigator
on grounds that were later reversed on appeal by a Labor Department administrative law
judge. The bank ultimately reached a settlement with the employee in 2015.
The three other complaints - one in 2009 and two in 2010 - were transferred to state and
federal courts, respectively.
One employee of the Labor Department involved with the cases has since filed his own
whistleblower claim against the agency, alleging his office has a history of mishandling
cases. His complaint does not reference the Wells Fargo complaints specifically.
"It's absolutely outrageous that whistleblowers contacted OSHA as early as 2009 about
potential fraud at Wells Fargo, and yet these government bureaucrats failed to do their
job," said Sen. David Vitter, a Louisiana Republican who has been looking into how Wells
Fargo's sales practices have impacted small business owners.
Labor Department Secretary Thomas Perez said last month that the department has
launched a "top-to-bottom" review of prior Wells Fargo whistleblower complaints.
Agency spokesman Jesse Lawder said it is the department's policy not to comment on
specific whistleblower cases, but said the review aims to "ensure whistleblowers receive the
protections and remedies afforded them."
Richele Messick, a Wells Fargo spokeswoman, could not comment on individual cases, but
said the bank "does not tolerate retaliation against team members who report their
concerns and will take measures to protect team members from retaliation."
From fiscal year 2005 through 2015, less than two percent of all whistleblower complaints
filed with OSHA were won on the merits, federal statistics show. The rest were either
settled, dismissed or transferred to federal courts.
Lawyers who represent whistleblowers say OSHA investigators face challenges. One
problem is the "crushing case load," which can lead to significant delays, said attorney
Jason Zuckerman.
OSHA, which received 3,288 whistleblower cases in fiscal year 2015, currently has 88
full-time investigators across the country in 10 regional offices.
INTERNAL CRITICISM
OSHA refers whistleblower complaints to the relevant federal regulators to investigate. But
the office does not always refer them promptly, or sometimes at all, the Labor
Department's inspector general found last year.
An earlier audit in September 2010 found that 80 percent of complaints it reviewed were
not properly investigated, meaning OSHA staff did not take steps such as interviewing the
employee, obtaining a witness list or allowing the employee to refute the employer's
defense.
The subsequent audit in September 2015 noted improvements, finding that 18 percent of
complaints reviewed failed to meet certain investigative criteria.
Still, it also found that 72 percent of all of OSHA's investigations were not performed within
the 30, 60 or 90-day time frames specified by various whistleblower protection laws.
OSHA disputed some of those findings at the time, saying the audit relied on "inaccurate
data" to determine how well it referred cases to other regulators.
Labor Department spokeswoman Amanda McClure said OSHA's practice is to send copies
of complaints when it receives them and its findings at the conclusion of the investigation to
either the Securities and Exchange Commission or the CFPB, depending on which federal
whistleblower law applies.
It is not clear whether OSHA, which received complaints of the unauthorized account
openings at Wells Fargo dating at least as far as 2009, referred the matters to federal
banking regulators, such as the CFPB and the Office of the Comptroller of the Currency.
The CFPB, a new agency launched in July 2011, has said it did not start investigating the
issue until it received tips from whistleblowers in mid-2013.
The OCC has said it first learned about the issues after it received a "small number" of
complaints from consumers and bank employees in March 2012. Those complaints and
media reports in December 2013 led the regulator to step up its supervision of Wells Fargo.
An SEC spokeswoman declined to comment on whether OSHA had referred the complaints
about Wells Fargo's sales practices.
A CFPB spokesman declined to comment on whether the office had received any OSHA
referrals involving Wells sales abuses.
SITTING IN A STACK OF FILES
Darrell Whitman - a former OSHA investigator in the San Francisco office from 2010-2015 -
was assigned to three of the five cases examined by Reuters from former Wells Fargo
employees alleging retaliation for reporting improper sales tactics.
Whitman said he only briefly dealt with Ponce de Leon's 2011 case before it was
transferred to another investigator, and he was instructed to close the two 2010 cases
because they were slated to be transferred to a federal court.
Another investigator assigned at one point to Ponce de Leon's case, Susan Kamlet, told
Reuters the case sat in a stack of other files and that her manager controlled which cases
had priority.
Now the former OSHA investigators are making their own claims of retaliation.
Whitman alleges he was fired for raising concerns about the agency's mishandling of
whistleblower complaints, and Kamlet says she was fired for supporting his accounts and
for raising concerns about a particular case she was investigating.
Whitman has since filed a whistleblower complaint of his own with the Office of Special
Counsel, an office that investigates retaliation against federal employees.
His complaint is still pending.
The Labor Department spokeswoman and the Office of Special Counsel declined to
comment. (Reporting by Sarah N. Lynch; Editing by Soyoung Kim and Edward Tobin)
program
Reuters
Oct. 14, 2016
By Sarah N. Lynch
WASHINGTON, Oct 13 (Reuters) - Former Wells Fargo & Co general manager Claudia
Ponce de Leon filed a whistleblower complaint in December 2011 with federal labor
regulators, alleging she was fired for telling superiors about employees opening
unauthorized accounts.
Nearly five years later, she has not been interviewed by investigators at the Labor
Department's Occupational Safety and Health Administration (OSHA), said her attorney
Yosef Peretz.
Her complaint claiming retaliation by Wells Fargo for reporting potential misconduct is one
of several dozens filed against the bank over the last 14 years, Reuters has found.
Their existence shows U.S. government regulators are still not meeting targets set by law --
a problem that was also flagged in a critical internal report issued in September 2015.
As of Oct. 6, the agency had yet to close out 34 of the 91 complaints it has received since
fiscal year 2002 from Wells Fargo employees alleging they faced retaliation after reporting
potential wrongdoing, according to department data obtained through a Reuters public
records request.
The department did not disclose details of the claims or the dates they were filed, and it
remained unclear how many were related to the ongoing scandal involving Wells staffers
opening as many as 2 million accounts without customer permission. It is also unclear how
those 91 complaints against Wells Fargo compares with other corporations.
The bank last month agreed to pay $190 million in fines and customer restitution in a
settlement with the Consumer Finance Protection Bureau and other regulators.
In late September, Reuters identified Ponce de Leon and at least four other former Wells
Fargo employees who reported to OSHA between 2009 and 2014 that they were fired for
raising concerns about the opening of unauthorized accounts and credit cards. Of the five
OSHA complaints seen by Reuters, Ponce de Leon's case has been pending since
December 2011, and another 2014 case was initially dismissed by an OSHA investigator
on grounds that were later reversed on appeal by a Labor Department administrative law
judge. The bank ultimately reached a settlement with the employee in 2015.
The three other complaints - one in 2009 and two in 2010 - were transferred to state and
federal courts, respectively.
One employee of the Labor Department involved with the cases has since filed his own
whistleblower claim against the agency, alleging his office has a history of mishandling
cases. His complaint does not reference the Wells Fargo complaints specifically.
"It's absolutely outrageous that whistleblowers contacted OSHA as early as 2009 about
potential fraud at Wells Fargo, and yet these government bureaucrats failed to do their
job," said Sen. David Vitter, a Louisiana Republican who has been looking into how Wells
Fargo's sales practices have impacted small business owners.
Labor Department Secretary Thomas Perez said last month that the department has
launched a "top-to-bottom" review of prior Wells Fargo whistleblower complaints.
Agency spokesman Jesse Lawder said it is the department's policy not to comment on
specific whistleblower cases, but said the review aims to "ensure whistleblowers receive the
protections and remedies afforded them."
Richele Messick, a Wells Fargo spokeswoman, could not comment on individual cases, but
said the bank "does not tolerate retaliation against team members who report their
concerns and will take measures to protect team members from retaliation."
From fiscal year 2005 through 2015, less than two percent of all whistleblower complaints
filed with OSHA were won on the merits, federal statistics show. The rest were either
settled, dismissed or transferred to federal courts.
Lawyers who represent whistleblowers say OSHA investigators face challenges. One
problem is the "crushing case load," which can lead to significant delays, said attorney
Jason Zuckerman.
OSHA, which received 3,288 whistleblower cases in fiscal year 2015, currently has 88
full-time investigators across the country in 10 regional offices.
INTERNAL CRITICISM
OSHA refers whistleblower complaints to the relevant federal regulators to investigate. But
the office does not always refer them promptly, or sometimes at all, the Labor
Department's inspector general found last year.
An earlier audit in September 2010 found that 80 percent of complaints it reviewed were
not properly investigated, meaning OSHA staff did not take steps such as interviewing the
employee, obtaining a witness list or allowing the employee to refute the employer's
defense.
The subsequent audit in September 2015 noted improvements, finding that 18 percent of
complaints reviewed failed to meet certain investigative criteria.
Still, it also found that 72 percent of all of OSHA's investigations were not performed within
the 30, 60 or 90-day time frames specified by various whistleblower protection laws.
OSHA disputed some of those findings at the time, saying the audit relied on "inaccurate
data" to determine how well it referred cases to other regulators.
Labor Department spokeswoman Amanda McClure said OSHA's practice is to send copies
of complaints when it receives them and its findings at the conclusion of the investigation to
either the Securities and Exchange Commission or the CFPB, depending on which federal
whistleblower law applies.
It is not clear whether OSHA, which received complaints of the unauthorized account
openings at Wells Fargo dating at least as far as 2009, referred the matters to federal
banking regulators, such as the CFPB and the Office of the Comptroller of the Currency.
The CFPB, a new agency launched in July 2011, has said it did not start investigating the
issue until it received tips from whistleblowers in mid-2013.
The OCC has said it first learned about the issues after it received a "small number" of
complaints from consumers and bank employees in March 2012. Those complaints and
media reports in December 2013 led the regulator to step up its supervision of Wells Fargo.
An SEC spokeswoman declined to comment on whether OSHA had referred the complaints
about Wells Fargo's sales practices.
A CFPB spokesman declined to comment on whether the office had received any OSHA
referrals involving Wells sales abuses.
SITTING IN A STACK OF FILES
Darrell Whitman - a former OSHA investigator in the San Francisco office from 2010-2015 -
was assigned to three of the five cases examined by Reuters from former Wells Fargo
employees alleging retaliation for reporting improper sales tactics.
Whitman said he only briefly dealt with Ponce de Leon's 2011 case before it was
transferred to another investigator, and he was instructed to close the two 2010 cases
because they were slated to be transferred to a federal court.
Another investigator assigned at one point to Ponce de Leon's case, Susan Kamlet, told
Reuters the case sat in a stack of other files and that her manager controlled which cases
had priority.
Now the former OSHA investigators are making their own claims of retaliation.
Whitman alleges he was fired for raising concerns about the agency's mishandling of
whistleblower complaints, and Kamlet says she was fired for supporting his accounts and
for raising concerns about a particular case she was investigating.
Whitman has since filed a whistleblower complaint of his own with the Office of Special
Counsel, an office that investigates retaliation against federal employees.
His complaint is still pending.
The Labor Department spokeswoman and the Office of Special Counsel declined to
comment. (Reporting by Sarah N. Lynch; Editing by Soyoung Kim and Edward Tobin)
Allegiant Air, with ultra-low fares, draws FAA’s attention over safety concerns
By Steven Mufson and Ashley Halsey III
September 1, 2016
Just over a year ago, Allegiant Air pilot Jason Kinzer was sitting in the cockpit of a 24-year-old McDonnell Douglas MD-80 aircraft bound for Hagerstown, Md., having just taken off from
St. Petersburg, Fla. As the plane climbed through 2,500 feet, a cabin attendant alerted Kinzer to a strong burning smell. Alarmed, Kinzer turned Allegiant Air Flight 864 back toward the
airport. Fire and rescue crews met the plane on the runway as smoke wafted from an engine. Kinzer told the 144 passengers to disembark. He then helped a flight attendant carry a
paraplegic passenger to the exit.
It seemed to be model behavior. But Allegiant Air did not praise Kinzer. It fired him.
In a dismissal letter, the airline called the evacuation of the plane “unwarranted” and faulted Kinzer as not “striving to preserve the Company’s assets, aircraft, ground equipment, fuel
and the personal time of our employees and customers.” Later, the company’s attorneys would call Kinzer’s account an “inaccurate and self-serving recitation of events.”
Kinzer’s saga, now the subject of a court case in Nevada, involves one of dozens of incidents that have prompted scrutiny of the safety and maintenance practices at Allegiant Air, a
low-cost carrier that has found a profitable niche in serving airports in small-to-midsize cities.
In an industry that has habitually struggled to make money, Allegiant’s soaring earnings stand out. Last year, its profits jumped 154 percent, to $220.4 million, as the carrier — relying
heavily on cheaper, previously used planes — flew more than 300 routes. In June, Allegiant announced a dozen new routes and three new cities, for the first time competing with major
carriers at airports in Newark and Denver.
By Steven Mufson and Ashley Halsey III
September 1, 2016
Just over a year ago, Allegiant Air pilot Jason Kinzer was sitting in the cockpit of a 24-year-old McDonnell Douglas MD-80 aircraft bound for Hagerstown, Md., having just taken off from
St. Petersburg, Fla. As the plane climbed through 2,500 feet, a cabin attendant alerted Kinzer to a strong burning smell. Alarmed, Kinzer turned Allegiant Air Flight 864 back toward the
airport. Fire and rescue crews met the plane on the runway as smoke wafted from an engine. Kinzer told the 144 passengers to disembark. He then helped a flight attendant carry a
paraplegic passenger to the exit.
It seemed to be model behavior. But Allegiant Air did not praise Kinzer. It fired him.
In a dismissal letter, the airline called the evacuation of the plane “unwarranted” and faulted Kinzer as not “striving to preserve the Company’s assets, aircraft, ground equipment, fuel
and the personal time of our employees and customers.” Later, the company’s attorneys would call Kinzer’s account an “inaccurate and self-serving recitation of events.”
Kinzer’s saga, now the subject of a court case in Nevada, involves one of dozens of incidents that have prompted scrutiny of the safety and maintenance practices at Allegiant Air, a
low-cost carrier that has found a profitable niche in serving airports in small-to-midsize cities.
In an industry that has habitually struggled to make money, Allegiant’s soaring earnings stand out. Last year, its profits jumped 154 percent, to $220.4 million, as the carrier — relying
heavily on cheaper, previously used planes — flew more than 300 routes. In June, Allegiant announced a dozen new routes and three new cities, for the first time competing with major
carriers at airports in Newark and Denver.