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    Virginia legislators last week took another stab at reforming the state’s ethics laws by passing a new limit on gifts to public officials. But while the move was a response to the conviction last year of former Gov. Robert F. McDonnell on corruption charges, it’s unclear whether the new measure would actually have prohibited any of the actions that precipitated the case.

    Despite those doubts, the current governor, Terry McAuliffe, has indicated he would sign the legislation, saying it will “send Virginians a message that their leaders recognize the need to restore their trust in government.”

    The state has some of the nation’s most forgiving ethics laws and earned an F from the State Integrity Investigation, a data-driven ranking of state government accountability and transparency published in 2012 by the Center for Public Integrity, Global Integrity and Public Radio International. In September, McDonnell, a Republican, was convicted on charges stemming from more than $100,000 in undisclosed gifts and loans he and his family received from a supporter.

    The new law places a $100 annual limit on gifts to public officials from lobbyists and some people with state business and will require that lawmakers submit the disclosures electronically for publication in an online database.

    Last year, lawmakers had passed a $250 cap — previously there had been no limits — but the law applied only to “tangible” gifts, meaning lobbyists could continue to spend unlimited amounts on travel, entertainment and food for public officials. That distinction drew widespread criticism, and McAuliffe, a Democrat, made passing a broader cap one of his top priorities this year. The 2014 legislation also required officials to disclose gifts to their immediate family members, closing a loophole that allowed much of the money McDonnell’s family received to go unreported (officials, and since 2014 their immediate family too, must report all gifts over $50).

    Passage of the new measure occurred after a back-and-forth between McAuliffe and lawmakers over a series of amendments he proposed to the original bill, which the legislature passed in February. Lawmakers eventually accepted only a few of the governor’s amendments, which they passed in a rushed one-day special session. Language in the final version tightens the state’s limits on gifts while including new provisions that seem to maintain parts of the loophole that led to criticism of last year’s legislation.

    In fact, while the new law will make it harder for people seeking influence to lavish officials with expensive gifts, there are still opportunities. Here are four ways you can still give beyond the $100 cap:

    • Don’t be a lobbyist – Just like in last year’s bill, the cap applies only to lobbyists and their employers or to people seeking contracts with a state agency, provided the beneficiary of the gift is an employee of or has authority over the agency in question. There’s disagreement over whether this would have applied to businessman Jonnie R. Williams Sr., who gave the gifts and loans to McDonnell and his family. Williams wanted the state to fund studies of his product, a health supplement. Lawmakers are still required to disclose all gifts, whether they come from lobbyists — and therefore fall under the cap — or not.
    • Pay for travel to certain meetings – The law exempts from the gift cap payments related to meetings of national groups such as the National Conference of State Legislatures or the American Legislative Exchange Council, a controversial conservative group. Cristina Nuckols, a spokeswoman for McAuliffe, said that another section of the state’s disclosure requirements, which covers payments for talks and meetings, will require lawmakers to disclose payments for travel, even if they are not considered gifts. Essentially, though, this clause maintains one part of the “intangible” exemption that the 2014 law created.
    • Invite your friends – Another provision exempts “widely attended events” from the gift limits. Lawmakers say the point of this was to allow them to continue to attend Rotary Club dinners or Farm Bureau meetings without having to worry whether the food served would be allowed under the law. It also means that an industry group and its lobbyists can spend unlimited amounts wining and dining lawmakers as long as they invite more than 25 people. Officials will still have to report these gifts.
    • Or don’t – The bill says that food and beverages at an event where a public official is “performing official duties related to his public service,” do not qualify as gifts. Theoretically, then, a lobbyist can continue to provide unlimited steak and scotch to officials as long as they are at events that meet that criterion. But importantly, it also means lawmakers will no longer be required to disclose such food and beverage “gifts,” because they no longer fit the definition of a gift.

    The rush towards passage at various stages — the original bill was passed on the last day of the regular session, and lawmakers hashed out McAuliffe’s amendments during one afternoon of the special session — left room for debate over lawmakers’ intentions, and whether they were sneakily trying to maintain broad exemptions or simply trying to create a workable bill under pressure. Much of the measure’s language is complex and obtuse — intentionally or not. Del. C. Todd Gilbert, a Republican and the bill’s chief sponsor in the House of Delegates, said lawmakers were not trying to create new exemptions or hide gifts from the public. “There’s certainly nothing nefarious going on,” he said. “Nobody’s trying to hide something that was transparent.”

    The changes go into effect January 1, and Gilbert said the legislature will likely be back at work on the gift cap once again next year, looking to correct any unintended consequences. “We always anticipated there would be some things that would need fixing.”

    Anna Scholl, executive director of ProgressVA, a liberal advocacy group, said the bill is a significant improvement, but that it ignores many related issues, such as the creation of an independent ethics commission and limits on lawmakers’ use of campaign accounts. “This is pretty much the least that the general assembly could get away with doing,” she said.

    Virginia Governor Terry McAuliffe speaking at the state capitol in Richmond in April, 2015.Nicholas Kusnetzhttp://www.publicintegrity.org/authors/nicholas-kusnetzhttp://www.publicintegrity.org/2015/04/24/17229/virginias-new-ethics-legislation-would-close-some-loopholes-skip-others

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    Vice President Joe Biden paid a visit to the University of Illinois Thursday to spotlight the Obama administration’s latest campaign to combat campus sexual assault — the topic of a groundbreaking investigation by the Center for Public Integrity.

    Speaking before a rousing crowd of students and administrators at a recreation center on the university’s Urbana-Champaign campus, Biden urged that everyone in the audience — especially men — pledge to prevent what he called a “vicious form of violence” at schools nationwide. A long-time crusader against gender-based violence, who authored the landmark 1994 Violence Against Women Act, the vice president spoke passionately about the subject of sexual assault on college campuses.

    “The culture has come a long way, but it has so much farther to go,” said Biden, his voice rising. “Until we make a pariah of all those who believe they have a right to say, ‘She asked for it,’ we won’t make the progress we have to make.”

    He added, “It is within our power to end sexual abuse on every campus in every community. There really is no excuse.”

    The Illinois rally, held in honor of Sexual Assault Awareness Month, celebrated the White House’s “It’s on Us” awareness campaign, which encourages students and administrators not only to respond to sexual assault on college campuses, but also prevent it. Launched last fall, the education effort features celebrity-studded public-service announcements geared toward college-aged men. According to the White House, more than 300 colleges and universities have hosted student-led rallies, pledge drives and similar “It’s on Us” events. Biden praised the Urbana-Champaign student body for doing more than any other campus to implement the program.

    The campaign is but the latest action on a variety of fronts to curb what Biden, President Barack  Obama and Education Secretary Arne Duncan have called an “epidemic” of sexual violence on college campuses. In April 2104, a White House task force announced recommendations for helping schools respond to the problem, launching a website, NotAlone.gov. Within days, the Education Department released for the first time a list of every college and university under investigation for possible violations of federal law because of the way they have handled claims of sexual assault; to date, the list comprises around 100 schools.

    The Obama administration has issued stricter federal guidelines and taken up the cause more generally in the years since the Center’s investigation. Published in a six-part series starting in 2009, “Sexual Assault on Campus: A Frustrating Search for Justice” — done in collaboration with National Public Radio — showed that campus judicial proceedings regarding allegations of sexual assault were often confusing, shrouded in secrecy, and marked by lengthy delays. Those who reported sexual assaults encountered a litany of institutional barriers that either assured their silence or left them feeling victimized again. Even students found “responsible” for alleged sexual assaults often faced little punishment, while their victims’ lives were turned upside down.

    The issue has continued to attract both attention and controversy. Male students accused of campus sexual assault and some of their lawyers have charged that the adjudication process is unfair to them. More recently, there has been a national furor over a now-discredited article published in the December 2014 issue of Rolling Stone magazine. Earlier this month, Columbia University released a scathing audit chronicling how the magazine’s editorial staff had failed to undertake what it described as “basic, even routine journalistic practice” to verify a student’s account of an alleged gang rape at the University of Virginia.

    At the Illinois campus, though, Biden took the opportunity to call on school administrators to “step up” to combat sexual violence, noting that “all too often, institutions re-victimize the victim.”

    “Colleges and universities . . . have a legal obligation and a moral obligation to protect,” he said. “This isn’t abstract.”

    Vice President Joe Biden speaking at the University of Illinois Urbana-Champaign.Kristen Lombardihttp://www.publicintegrity.org/authors/kristen-lombardihttp://www.publicintegrity.org/2015/04/24/17232/biden-cites-progress-campus-sexual-assault-says-theres-so-much-farther-go

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    The Center for Public Integrity’s documentary Time is Money has won a Sigma Delta Chi Award for digital video, the Society of Professional Journalists announced Thursday.

    As part of the Profiting from Prisoners series, the 23-minute documentary revealed how a growing web of prison bankers, private vendors and corrections agencies profit off the innocent by shifting costs onto inmates’ families. Multimedia editor Eleanor Bell and finance reporter Dan Wagner collaborated on the project.

    SPJ judges selected 85 honorees from more than 1,600 submissions. Entries included selections from television and radio broadcasts, newspapers, online news outlets and magazines.

    Dating back to 1932, the Sigma Delta Chi awards originally honored six individuals for contributions to journalism.

    The current program began in 1939, when the Society granted the first Distinguished Service Awards. The honors later became the Sigma Delta Chi Awards.

    Founded in 1909 as Sigma Delta Chi, SPJ promotes the free flow of information vital to a well-informed citizenry; works to inspire and educate the next generation of journalists; and protects First Amendment guarantees of freedom of speech and press.

    Sigma Delta Chi award winners will be honored at an awards banquet in June at the National Press Club in Washington, D.C. The Center for Public Integrity congratulates all of the winners.

    William Grayhttp://www.publicintegrity.org/authors/william-grayhttp://www.publicintegrity.org/2015/04/24/17230/prison-bankers-documentary-wins-sigma-delta-chi-award

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    The demise of the Comcast Corp.-Time Warner Cable Inc. merger doesn’t mark an end to the consolidation of the cable and Internet-provider market — analysts are saying it’s likely the beginning of what will be a new rush of mergers that will make an already consolidated market more so and likely cause prices to rise.

    Comcast, the largest cable and Internet provider in the United States, announced today that it was dropping its $45 billion bid for Time Warner Cable, the second-largest cable and Internet provider. The Justice Department, which was analyzing the deal’s effect on competition, had raised concerns about the combined company controlling 57 percent of household Internet connections nationwide, making it “an unavoidable gatekeeper for Internet-based services.”

    The decision followed a move by the Federal Communications Commission to turn the matter over to an administrative law judge to rule on the merger, which effectively would have killed the deal. FCC Chairman Tom Wheeler said Comcast’s decision was “in the best interests of consumers.”

    While the mega-merger failed, cable companies have indicated a series of smaller mergers are likely shrinking what is already a consolidated industry. Charter Communications Inc., which was close to acquiring Time Warner Cable before Comcast stepped in with a better deal, has said it would go after Time Warner Cable again.

    Charter, which is in a distant third place among cable providers, had struck a $10 billion deal to buy cable and Internet-provider Bright House Networks LLC, which mostly offers service in central Florida, parts of Alabama and around Indianapolis. But it is possible Charter could end up buying both Time Warner Cable and Bright House.

    Cox Communications Inc. also may look to purchase other cable companies.

    Consumer groups say future mergers will give customers even fewer choices of Internet providers in a market that already offers scant options. Even with four large cable companies — Comcast, Time Warner Cable, Charter and Cox — and four large telecommunications providers — AT&T Inc., Verizon Communications Inc., CenturyLink Inc. and Frontier Communications Corp. — Americans still have few choices because the providers avoid competing with each other, as a Center for Public Integrity analysis showed.

    For example, five companies offer Internet service in Roanoke, Virginia. But almost all residents in and around Roanoke have a choice of only two providers, one cable company and one telecommunications company offering DSL service.

    Only 23 percent of Americans have a choice of two Internet providers under the FCC’s newest definition of broadband, 25 megabits per second download and 3 megabits per second upload, according to the FCC. Even at 10 mbps download, half of Americans have a choice of two providers, and 30 percent have only one choice.

    Allan Holmeshttp://www.publicintegrity.org/authors/allan-holmeshttp://www.publicintegrity.org/2015/04/24/17237/analysis-failure-comcast-time-warner-deal-may-spark-new-wave-mergers

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    The health insurance industry took advantage of Washington’s infamous revolving door last week when it named former Rep. Allyson Schwartz of Pennsylvania, perceived by many to be a liberal Democrat, as the face of its latest K Street-operated front group.

    Schwartz, a former five-term member of Congress who made an unsuccessful bid for Pennsylvania governor last year, announced in an email blast Tuesday that she had found work again, not back home but back inside the Beltway. “Today I will begin as President and CEO of the Better Medicare Alliance,” she told her “friends and supporters.”

    The Better Medicare Alliance is a so-called 501(c)(3) nonprofit that appears to have been created with funding from insurance companies  by APCO Worldwide, a Washington influence firm with a long history of running front groups for its clients. I worked with APCO on several projects during my years at Cigna. 

    The Better Medicare Alliance’s raison d’etre is to widen the federal spigot of taxpayer dollars already gushing into the bank accounts of insurance companies that operate Medicare Advantage plans, those privately run alternatives to traditional Medicare. Enrollment is concentrated in a small number of companies, among the biggest of which are for-profit insurers UnitedHealth Group, Humana and  Aetna. 

    As the Center for Public Integrity has reported extensively over the past year, the federal government for years has overpaid Medicare Advantage insurers, which has enabled the companies to better reward their shareholders. Insurance firms have also used the overpayments to add benefits not covered by traditional Medicare, like hearing aids, and to offer lower copayments.

    Insurers that participate in the Medicare Advantage program devote big chunks of their advertising and sales budgets to lure seniors away from the traditional Medicare program, which costs taxpayers less. For many seniors, the marketing is irresistible. Enrollment in Medicare Advantage plans jumped 10 percent between 2013 and 2014. Thirty percent of Medicare’s 54 million beneficiaries are now in a Medicare Advantage plan.

    Insurers insist that Medicare Advantage plans represent a good value for seniors and the country. They say, for example, that because of the managed care techniques they use, they are better able to coordinate care for seniors with chronic conditions.

    A downside rarely mentioned is that many doctors and health care facilities, including nursing homes, refuse to participate in Medicare Advantage provider networks. Other providers that might want to participate are often excluded. My own mother didn’t fully appreciate the consequences of her Medicare Advantage plan’s limited network until recently. She decided to switch back to traditional Medicare so she could go to a nursing home of her choice with high quality ratings.

    “The purpose of the Better Medicare Alliance is to bring together a national coalition of health plans, providers, advocates and beneficiaries to support and strengthen Medicare Advantage,” wrote Schwartz. Despite being a favorite of Emily’s List and other liberal groups, Schwartz received a third of the $16 million she raised in campaign contributions during her career from people and companies in health care and insurance and from “lawyers and lobbyists,” according to OpenSecrets.org.

    Having worked with numerous front groups in the past, I’m betting that the real purpose of the Better Medicare Alliance is to strengthen the profits of health insurers, many of whom contributed to her various campaigns, by making sure that proposed cuts to Medicare Advantage plans never get implemented.

    Even though the Better Medicare Alliance lists several nonprofit organizations as allies on its website (and gives them equal billing to Aetna, Humana and UnitedHealth Group), I recognized many of them—the U.S. Chamber of Commerce, the National Association of Manufacturers, the National Retail Federation and the Healthcare Leadership Council—as groups ever ready to aid and abet the insurance industry.

    As an industry executive, I worked with every one of them during the various campaigns we waged whenever a proposed law or regulation surfaced somewhere that might have hurt profits. Know this, though: while those organizations were willing to lend their names to give our front groups the appearance of being genuine coalitions, they expected us to kick in most if not all of the money to cover the front groups’ expenses.

    So how can I be so sure the Better Medicare Alliance is a front group, aside from the mention of the usual suspects as allies? There are these other tell-tale signs: no listing of a physical address or phone number on its website; no mention of employees other than Schwartz; no board of directors (I wanted to know who actually hired Schwartz and who she answers to); no apparent way to reach anyone there other than through a generic email address. (The questions I submitted to the group last Wednesday have still not been answered.)

    I did finally find the name of a real person, someone I had worked with often during my days in the industry, not on the group’s website but on its press releases. He’s Bill Pierce. Senior Director of, you guessed it, APCO Worldwide.

    Wendell Potter is the author of Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR is Killing Health Care and Deceiving Americans and Obamacare: What’s in It for Me? What Everyone Needs to Know About the Affordable Care Act.

    Former U.S. Rep. Allyson Schwartz, walks from the booth after voting Tuesday, May 20, 2014, in Jenkintown, Pa.Wendell Potterhttp://www.publicintegrity.org/authors/wendell-potterhttp://www.publicintegrity.org/2015/04/27/17240/former-rep-allyson-schwartzs-new-group-better-medicare-alliance-not-what-it-appears

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  • 04/27/15--18:09: U.S. reach, worldwide impact
  • At a recent health conference for non-profits run by Media Impact Funders I was struck by the effort devoted to campaigns on what we eat and how much. One of the best-funded schemes was a documentary on obesity.
     
    What’s really in our food?
     
    When we focus on the impact of food there is perhaps an assumption that we know what we eat or at least that what we eat is effectively regulated. Not so, according to a lengthy investigation by Public Integrity led by Chris Young with Erin Quinn. It turns out that not only is the FDA unable to check what goes in to our food,  it appears that some of the same characters  - the very same scientists — who worked for the tobacco companies in advising on the dangers of smoking are now advising on what goes into our food. It’s a harrowing story which brings the plot of the film “Thank You For Smoking”  to life. The prime story from Chis and Erin set out the case and was superbly amplified by a very clever piece of animated video conceived and executed by Jared Bennett and Eleanor Bell with Chris and Erin. It’s the sort of story telling we may do more. The influence of the “tobacco” guys on our food supply is morbidly fascinating too.
     
    Partners on the piece to add to its dissemination included NPR.
     
    Do no harm…oh really?
     
    ICIJ colleagues Sasha Chavkin and Michael Hudson released the first fruits of a lengthy project on the World Bank and the displacement of tens of thousands of people around the world by World Bank projects gone awry. Months in the works,  the project represented painstaking analysis across dozens of projects and countries by the ICIJ and collaborators to create a file of evidence the World Bank couldn’t deny. In fact, far from denying it,  the World Bank President Jim Yong Kim used our questions to him as a catalyst to announce new policies to safeguard people.
     
    “We took a hard look at ourselves on resettlement and what we found caused me deep concern,” Jim Yong Kim said
     
    The World Bank project was a great example of collaboration with the Huffington Post which hosted the project and brought some of its resources to the story-telling and of course opened up our work to a far larger audience. The interactive globe in the middle of the page gives you a sense of just how widespread the negative impact of some of these World Bank-supported projects has been: usually of course, because of local governments rather than the World Bank,  but it’s clear that the bank’s commitment to “do no harm” isn’t quite working as it would wish.
     
    Big oil, bad air – wins for Public Integrity
     
    Jim Morris and his team on the Environment beat continue to excel in bringing a human face and powerful data to their stories. Their work on the largely unreported health and environmental impact of fracking in the Texas Eagle Ford Shale, has won the prestigious National Press Foundation Stokes Award. The NPF people rang me and described Jim as a “legend”. He worked on the project with Inside Climate News and the Weather Channel. As always, awards are a vital part of our impact in the industry and a great recognition of the Center’s work.

    ​As a foreigner who is also conscious of the huge economic benefits of fracking in the US,  I was struck by the impact and prescience of Jim’s work when I read this piece in the New Yorker on the huge increase of earthquakes in Oklahoma, definitively caused by fracking.
     
    On the subject of What We’re Reading, here’s one from Center Executive Editor, Gordon Witkin:
    John Grisham’s latest, Gray Mountain, which bears a stunning, almost eerie resemblance to the Center’s Pulitzer Prize-winning Breathless & Burdened project.
     
    And a follow up on that story I got angry about last week: Susan Ferriss’s extraordinarily well researched piece on children being treated as adults and incarcerated or otherwise mistreated by police and pseudo-police. Turns out other people give a damn about it too and more than 90,000 people have signed a petition on the campaign site Change.org to support the boy at the center of the story.
     
    Thanks for reading this far and I welcome any feedback.
    Regards,
    Peter Bale
    CEO, The Center for Public Integrity
    Father of five Joseph Kilimo Chebet stands next to the burned remains of his homestead, destroyed only hours prior by Kenya Forest Service officers.Peter Balehttp://www.publicintegrity.org/authors/peter-balehttp://www.publicintegrity.org/2015/04/27/17250/us-reach-worldwide-impact

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    The Center for Public Integrity will be covering worker safety throughout the year and we need your help. Head over to our Facebook Community to join a conversation around this topic.​

    Each year in advance of Workers’ Memorial Day— April 28 — a group in Philadelphia tries to tally every job-related death that occurred in Pennsylvania, New Jersey and Delaware the previous year.

    This year’s list includes 145 names, among them Duane Canipe, 65, who fell through a skylight and landed 23 feet below on May 11, 2014; Moses G. Fisher, 24, who was overcome by methane gas in a grain silo on September 17, 2014; and Adrian Perez, 54, whose clothing became entangled in a concrete-crushing machine on January 9, 2015.

    Perpetually uncounted are those who die of work-related illnesses — the “invisible victims” who succumb, generally years after exposure, to poisons such as asbestos, said Barbara Rahke, executive director of the Philadelphia Area Project on Occupational Safety and Health. “It’s almost impossible to get their names,” she said.

    Last week, the U.S. Bureau of Labor Statistics reported that 4,585 people were killed on the job in this country in 2013. Experts say, however, that the death toll from occupational disease in America may be 10 or more times higher. Workers in developing nations almost certainly have it worse.

    For this reason, the International Trade Union Confederation— a Brussels-based organization that represents 176 million workers belonging to 328 national affiliates, such as the AFL-CIO in the United States — decided that its theme for Workers’ Memorial Day 2015 would be “removing exposure to hazardous substances in the workplace.”

    “Chemicals we would have imagined by now would be globally banned keep popping up,” the confederation’s general secretary, Sharan Burrow, said in a recent telephone interview. “We see emerging fears around some of the new technological issues such as nanotechnology... it’s extraordinary, really. There’s a lot of fear amongst workers.”

    In a new report, the confederation cites what it calls a “cautious estimate” from the International Labour Organization that puts the annual death toll from workplace toxics at 651,279 worldwide. That’s one death every 52 seconds. The ILO says there are 160 million new cases of occupational disease each year.

    Chemical use, meanwhile, is soaring. More than 84,000 chemicals, only a fraction tested for safety, are in the U.S. Environmental Protection Agency’s Toxic Substances Control Act inventory, up from 62,000 in 1982. The North American chemical market is expected to grow by 25 percent from 2012 to 2020, according to a report from the United Nations Environment Programme.

    “The reality is, workers have very little capacity today to track exposures in their careers,” said Anabella Rosemberg, the International Trade Union Confederation’s Paris-based policy advisor for occupational health, safety and environment. “When workers changes sectors or companies very often, we don’t have health systems that allow them to know what substances they’ve been exposed to.” The burden is on the worker to prove harm, Rosemberg said. “This needs to change.”

    The epidemic of work-related cancer and other diseases cries out for stricter regulation, say Rosemberg and her counterpart at the AFL-CIO, Peg Seminario. “We have very few standards to protect workers [in the U.S.], and those we have are 40 or 50 years old and woefully out of date,” Seminario said.

    The U.S. Labor Department’s Occupational Safety and Health Administration admitted as much in a 2013 press release introducing a new Web tool to allow workers and employers to compare OSHA’s chemical exposure limits with often-stricter ones recommended by other agencies or bodies or enforced by the state of California. “There is no question that many of OSHA’s chemical standards are not adequately protective,” David Michaels, assistant labor secretary for occupational safety and health, was quoted as saying in the release.

    On Monday, after an AFL-CIO event memorializing victims of asbestos-related disease, Michaels said the chemical-by-chemical method of setting standards “has failed. It’s like Whac-a-Mole, regulatory Whac-a-Mole. If we issue a standard for one chemical, employers can shift to a different chemical which has no standard. So what we’re trying to do now is find a different approach. And it will be a challenge...but we have to do this.”

    Michaels said OSHA has asked the public for ideas on “how we can approach chemicals as categories. We need some help to get there, and we're hoping to get some help."

    The AFL-CIO event featured the work of photographer Earl Dotter and was sponsored by the Asbestos Disease Awareness Organization. As she spoke, that group’s president and CEO, Linda Reinstein, held the folded American flag that covered the coffin of her late husband, Alan, a metallurgical engineer who died in 2006 of mesothelioma, a cancer almost always caused by asbestos exposure. Today would have been the Reinsteins’ 30th wedding anniversary.

    Afterward, Reinstein said she was angry that legislation to reform the weak Toxic Substances Control Act does not include a ban on asbestos. “Last year we imported 450,000 tons, but the truth is, over the last 115 years, we consumed 31 million tons,” she said. “So it's not just what we continue to import, but it's the dangers in the workplace, and this bill will do nothing to actually work on banning it or cleaning up the problem.”

    Mike Dennen has felt the agony and terror of asbestos-related disease. In November 2012, Dennen, 61, of Sagamore, Massachusetts, was diagnosed with peritoneal mesothelioma, which occurs in the cell walls surrounding the abdominal cavity. Nodules that turned out to be malignant had been discovered during hernia surgery.

    Dennen assumes he inhaled asbestos fibers while working in the textile industry for 12 years in the 1970s and ‘80s. “None of the products I ever used had warnings that they could cause cancer,” he said in an interview.

    Dennen has had two surgeries. The second one, in January 2013, took 11 ½ hours. “They cut you from your breast bone all the way to the top of your penis,” he said. “I lost my right testicle and the cord to it...they scraped my bladder clean. I lost a lot of parts. The second night in [the intensive care unit], a minister was called up and was praying with me. I really thought I was going.”

    As he saw it, there was no alternative: “If I did nothing, I would be dead in a year.”

    Post-surgery, Dennen has gotten CT scans every three months. So far, he’s clean.

    This doesn’t mean the threat has passed. Mesothelioma, which kills about 3,000 people in the U.S. each year, “is not curable,” Dennen said. “It’s a dreadful way to die. It’s an evil, evil cancer.”

    Maryam Jameel contributed to this story

    &nbspWorkers Memorial Day procession in Philidelphia, 2013.Jim Morrishttp://www.publicintegrity.org/authors/jim-morrishttp://www.publicintegrity.org/2015/04/28/17245/workers-memorial-day-2015-appeal-control-toxic-substances

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    The U.S. government’s subsidies for Afghan security forces are allocated on a per capita basis, with the amounts reasonably pegged to the number of police and military personnel authorized to be on the rolls. But federal auditors have long worried that many personnel ostensibly in the forces are nothing more than ghost workers who don’t show up, leaving the extra funds in the hands of corrupt Afghan officials.

    That’s why Defense Secretary Ashton Carter raised eyebrows when he announced a few weeks ago that the Pentagon intends to finance an Afghan security force through 2017 at its existing, authorized level of 352,000 personnel — a force more than 50 percent bigger than the NATO alliance earlier said it would support at the end of that period.

    Federal auditors, in particular, are warning that this may be a hard ambition to fulfill, since no one has a solid estimate of how large that force is now, or a good way of finding out anytime soon.

    Special Inspector General for Afghanistan Reconstruction John F. Sopko plans to testify before a House subcommittee on April 29, for example, about his enduring concern that “neither the United States nor its Afghan allies truly know how many Afghan soldiers and police are available for duty, or, by extension, the true nature of their operational capabilities.”

    Layers of uncertainty undermine the reliability of existing troop strength data, according to Sopko’s testimony, which was obtained in advance by the Center for Public Integrity. The NATO-led military command in Afghanistan relies on the Afghan army and police to collect it with oversight from the Interior and Defense Ministries, he said. But the army and police often use inconsistent handwritten records instead of electronic systems, and the ministries’ efforts to verify it consist only of occasional, informal visits to army units.

    That fundamental — but unreliable — data forms the basis for all U.S. financial assistance and training for the Afghan security forces, according to Sopko.

    The uncertainties about the troop rolls have become particularly evident in recent months. In his last quarterly report, issued in January, Sopko wrote that “just hours before” its release, the senior U.S. military commander in Afghanistan told him the numbers his agency received between April and October, 2014, were incorrect. The commander attributed the mistake to an “accounting” issue that overstated the total between 4 and 5 percent.

    The size and strength of Afghan forces has been further obscured by the U.S. military’s recent decision to classify some of the data. Several months ago, for example, the NATO-led command in Afghanistan classified its assessments of Afghan national security forces’ fighting as well as the number of Afghan soldiers and police officers. That decision was partially reversed, after some embarrassing publicity, but attrition figures for the Afghan army at the corps level and below remain classified, as do the tallies of aircraft in the country’s inventory, according to Alex Bronstein-Moffly, a spokesman for Sopko.

    Corps level data about Afghan security forces is not just classified — it is not reliably known, U.S. military officials have confirmed.

    The NATO-led Resolute Support Mission’s composite commands “cannot adequately observe or verify” information at the Army corps level, U.S. Army Maj. Gen. Todd T. Semonite wrote in early April after Sopko recommended that the command implement stiffer controls over the daily attendance process for Afghan army personnel.

    “It is easy to question why payroll systems and processes were not focused on earlier in this fight… Well, we were focused on saving American lives!!” Semonite added in a handwritten note beneath his official response.

    U.S. Forces-Afghanistan spokesman Col. Brian Tribus did not respond to requests for comment on Wednesday.

    Semonite said he agreed with Sopko’s recommendation that the Afghan Defense Ministry should use an electronic system to track and report Afghan army personnel and payroll data, but he called Sopko’s suggested deadline of January 2016 “not achievable” and recommended pushing it back by 15 months.

    In 2012, leaders from Afghanistan and NATO member countries agreed at a summit in Chicago that the size of the Afghanistan National Security Forces should be 228,500 after the end of the NATO combat mission in 2014. They also said the Afghan government should begin contributing at least $500 million of the estimated $4.1 billion annual budget for those forces by 2015.

    The higher force strength that Carter said he now wants will cost at least $1.4 billion extra each year, according to estimates the Defense Department provided to Sopko, as explained in a new quarterly report that he plans to release April 30.

    In 2015, the Afghan government did indeed contribute half a billion to the Afghanistan Security Forces, according to the Defense Department’s fiscal year 2015 budget request for the forces. But the department’s budget request for 2016 projected spending by the Afghan government of  only $250 million for its army and police.

    Afghan security forces attend a ceremony in Laghman province, east of Kabul, Afghanistan, in January, 2015.Julia Hartehttp://www.publicintegrity.org/authors/julia-hartehttp://www.publicintegrity.org/2015/04/29/17254/billions-dollars-us-assistance-afghan-soldiers-and-police-still-based-ragged-data

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    The U.S. Department of Labor wants to stop coal companies from withholding medical evidence from miners seeking financial benefits after being disabled by black lung disease.

    The rule, proposed Tuesday, would address a major problem spotlighted in the Center for Public Integrity series “Breathless and Burdened,” which exposed how prominent doctors and lawyers helped coal companies defeat the benefits claims of miners sick and dying of black lung disease.

    The Labor Department singled out the case of coal miner Gary Fox, saying it “highlights the longstanding problem claimants face.” The first installment of the Center series featured Fox’s story — and it showed how the coal industry’s go-to law firm, Jackson Kelly PLLC, sometimes withheld crucial medical evidence from miners.

    Under federal law, miners who are disabled by black lung, a debilitating disease caused by inhaling dust in coal mines, are entitled to benefits that mining companies must pay. But the companies often fight the miners’ claims, and they almost always have far more money and access to highly-credentialed doctors, giving them a powerful advantage. Previously, the companies’ lawyers could pick the most advantageous pieces of this evidence to submit, while not revealing the rest.

    In Fox’s case, he lost after the law firm withheld two key medical reports indicating that Fox had an advanced stage of black lung. To support his family, Fox returned to the mines to work for five more years, getting progressively sicker.

    Finally, he no longer could work, so he retired and filed a new benefits claim. Unlike in his previous claim, he was able to find a lawyer to represent him and, after months of fighting with Jackson Kelly, learned of the withheld reports.

    Fox won his case in February 2009. Two months later, he died waiting on a lung transplant.

    Representatives of Jackson Kelly did not respond to requests for comment. In the past, the firm has said it did nothing wrong in Fox’s case and has argued that it is not required to turn over all of the medical evidence it gathers in the course of defending a claim.

    In the Labor Department’s view, this approach presents multiple problems. Many miners are unable to find a lawyer to handle their cases, let alone to fight a well-funded and sophisticated adversary over requests for medical records. Further, the department said, Congress’ intent when it established the black lung benefits system was “getting to the truth of the matte — ver following the technical formalities associated with regular civil litigation.”

    Requiring disclosure of all medical evidence “will put all parties on equal footing” and “may lead to better, more accurate decisions on claims,” the department wrote.

    The proposal authorizes sanctions for failing to disclose evidence. These could include disqualifying an attorney for the remainder of the case or invalidating a previous denial of benefits. The Center investigation identified cases in which Jackson Kelly refused to comply with an administrative law judge’s order to turn over documents or information, then argued that the judge had no authority to impose sanctions.

    A separate provision outlined in the proposed rule would prevent companies from ceasing benefits payments while trying to mount a new legal challenge to a previous award — something the department called a “recurring problem.”

    The proposed rule will be open for public comment for 60 days. A spokesman for the National Mining Association said the organization has not yet had time to review the proposal.

    Chris Hamby, a former Center for Public Integrity reporter, now works for BuzzFeed

    Chris Hambyhttp://www.publicintegrity.org/authors/chris-hambyhttp://www.publicintegrity.org/2015/04/29/17255/labor-dept-proposes-rule-keep-coal-companies-hiding-evidence-black-lung-cases

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    States that restrict municipalities from offering Internet service to residents could see their laws overturned if they based the bills on a model offered by a conservative legislative group.

    Many of the provisions in the model legislation promoted by the American Legislative Exchange Council (ALEC) were incorporated into a North Carolina law that was knocked down by the Federal Communications Commission in February, according to a Center for Public Integrity analysis.

    ALEC, a self-described free-market think tank made up of mostly Republican state lawmakers and funded by corporations and trade groups, created a model municipal broadband law in 2002 that makes it difficult, if not impossible, for cities to build their own networks. The goal of the legislation is to keep cities from what the group views as unfairly competing with large Internet providers such as Comcast Corp., Time Warner Cable Inc., Verizon Communications Inc. and AT&T Inc. All four companies have donated to ALEC and some executives have served in leadership positions on committees and boards.

    About 20 states have passed laws that either outright ban cities from building networks or places requirements that make it almost financially impossible to develop one. Many of the laws have provisions that are similar to ALEC’s model bill.

    Now they risk the same fate as North Carolina. In February, the FCC voted to preempt that state’s law and another in Tennessee that restrict cities from building or expanding broadband networks. The Tennessee attorney general is suing the FCC to overturn the decision.

    In its order, the FCC cited numerous provisions in North Carolina’s law that violate the Telecommunications Act of 1996. Six of those provisions are nearly identical to ALEC’s model legislation, according to a Center for Public Integrity analysis of the FCC order.

    By citing those six provisions, the FCC has by extension struck down much of ALEC’s model law, said Jim Baller, an attorney who represented Chattanooga, Tennessee, and Wilson, North Carolina, when they asked the FCC to preempt their states’ broadband laws.

    “Because the North Carolina law uses similar language to that found in the ALEC model legislation, it would seem to follow that any other state that has relied heavily on the ALEC model has also effectively banned municipal broadband investments,” Baller wrote in an email.

    ALEC has cited the North Carolina law as a good prototype for other states.

    Bartlett Cleland, an ALEC member and policy counsel for the Institute for Policy Innovation, a Texas-based think tank that promotes limited-government and free-market policies, said in an email that the ALEC model legislation doesn’t ban or create obstacles to city-run Internet networks, but gives citizens more say in municipal decisions.

    He referred to a provision in the model law that requires a city to hold a referendum on whether it can build a network. Cleland called such requirements “good government, working to include constituents as much as possible in decisions. In the same way, ALEC’s model legislation does the same for municipal broadband – protecting citizens and given them a say in outcomes that effect them.”

    The FCC disagreed.  It said North Carolina’s law requiring a referendum, along with other related restrictions, “conflict with Congress’s mandate to encourage the deployment of broadband and infrastructure investment. The Commission must, as directed by Congress, take action to remove these barriers.”

    Below are the six provisions in North Carolina’s municipal broadband law that are similar to ALEC’s model legislation, and what the FCC had to say about them.

    1. Geographical limitation

    N.C. law – HB 129

    160A-340.1 (3) “A city-owned communications provider shall … Limit the provision of communications service to within the corporate limits of the city providing the communications service.”

    ALEC model legislation

    “A municipality may not offer to provide or provide cable television services or public or advanced telecommunications services to a subscriber that does not reside within the geographic boundaries of the municipality.”

    FCC Order

    “On its face, there is no doubt that the territorial restriction contained in [N.C. HB 129] is a barrier to deployment and competition.

    2. Pricing restrictions

    N.C. law – HB 129

    160A-340.1 (8) “A city-owned communications provider shall … not price any communications service below the cost of providing the service, including any direct or indirect subsidies received by city-owned communications service provider … The city shall in calculating the costs of providing the communications service, impute … an amount equal to all taxes, including property taxes, licenses, fees, and other assessments that would apply to a private communications service provider, including federal, State, and local taxes; rights-of-way’ franchise, consent, or administrative fees; and pole attachment fees.”

    ALEC model legislation

    “In calculating the rates charged by a municipality for a cable television service or a telecommunications or advanced service, the municipality … may not price any … service at a level less than the sum of the actual direct costs of providing the service; the actual indirect costs of providing the service; and” an equal amount private providers pay in “federal, state, and local taxes; franchise fees; permit fees; pole attachment fees” and similar fees.

    FCC Order

    “Reading the provisions together, it is apparent that North Carolina has singled out communications services supplied by municipalities for more restrictive treatment and has done so to promote its preferred competitive arrangement in the interstate communications market…. We therefore view these restrictions as within our authority to preempt.”

    3. Legal compliance

    N.C. law – HB 129

    340.1(a)(1) “A city-owned communications provider shall … Comply … with all local, State, and federal laws, regulations, or other requirements applicable to the provision of the communications service if provided by a private communications service provider.”

    ALEC model legislation

    “A municipality that provides a cable television service shall comply with: the Cable Communications Policy Act of 1984 …; and the regulations issued by the Federal Communications Commission under the Cable Communications Policy Act of 1984 …. A municipality that provides a telecommunications or advanced service shall comply with the Telecommunications Act of 1996 …; the regulations issued by the Federal Communications Commission under the Telecommunications Act of 1996 …; applicable state statutes …; applicable rules of the state Public Service Commission.”

    FCC Order

    North Carolina, while requiring municipal providers to comply with requirements “that would apply to a private-sector provider, [it] does not relieve the municipal provider of any requirements that apply to all municipal operations, such as ‘open records requirements, civil service rules, Buy American provisions, and much more…. The result is a double burden for municipal providers,” and therefore impedes broadband deployment and competition.

    4. Subsidies

    N.C. law – HB 129

    340.1(a)(7) “A city-owned communications provider shall … not subsidize the provision of communications service with funds from any other noncommunications service, operation, or other revenue source, including any funds or revenue generated from electric, gas, water, sewer, or garbage services.”

    ALEC model legislation

    “A municipality may not cross subsidize its cable television services or its public or advanced telecommunications services with tax dollars; income from other municipal or utility services; below-market rate loans from the municipality; or any other means.”

    FCC Order

    “The statute imposes no parallel limitation on private-sector providers, which often have multiple lines of business. As with other provisions, if anything, the restriction makes the city’s service more risky by limiting the city’s ability to compete for customers.”

    5. Public hearings

    N.C. law – HB 129

    340.3 “A city or joint agency that proposes to provide communications service shall hold not fewer than two public hearings, which shall be held not less than 30 days apart, for the purpose of gathering information and comment” and disclose in advance any “feasibility study, business plan or public survey conducted or prepared by the city in conjunction with the proposed communications service.”

    “Notice of the hearings shall be published at least once a week for four consecutive weeks in the predominant newspaper of general circulation in the area in which the city is located.”

    ALEC model legislation

    “… the legislative body … shall schedule at least two public hearings to be held … at least seven days apart; and for the purpose of allowing the feasibility consultant to present the results of the feasibility study; and the public to become informed ….”

    “… the municipality shall publish notice of the hearings … at least once a week for three consecutive weeks in a newspaper of general circulation in the municipality.”

    FCC Order

    “… subjecting municipalities to these requirements may give private communications providers a competitive advantage such as access to sensitive business information that could be used to undercut municipal broadband networks.”

    6. Referendums

    N.C. law – HB 129

    340.4 A city must hold an election “on the question of whether the city may provide communications service.”

    ALEC model legislation

    “A legislative body by a majority vote may call an election whether or not the municipality shall provide the proposed cable television services; or telecommunications or advanced services.”

    FCC Order

    This and other restrictions North Carolina law imposes “conflict with Congress’s mandate to encourage the deployment of broadband and infrastructure investment. The Commission must, as directed by Congress, take action to remove these barriers.”

    The Federal Communications Commission in Washington, D.C.Allan Holmeshttp://www.publicintegrity.org/authors/allan-holmeshttp://www.publicintegrity.org/2015/04/29/17244/alec-based-restrictions-city-run-internet-risk-after-fcc-ruling

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    Conventional wisdom says he’s a long shot, but Sen. Bernie Sanders, I-Vt., today will announce he’s running for president.

    Sanders, known as a populist liberal and a self-described socialist, will run as a Democrat.

    He’s hoping to raise $50 million for his bid, Bloomberg reports— almost certainly far less than Democratic rival Hillary Clinton is expecting to pull in. But it’s still sizable sum for a U.S. senator from a small state who has traditionally leaned heavily on small-dollar donors.

    Here’s more on Sanders’ financial history:

    Image sources: AP

    Sources: Center for Public Integrity reporting and OpenSecrets.org

    Carrie Levinehttp://www.publicintegrity.org/authors/carrie-levineJared Bennetthttp://www.publicintegrity.org/authors/jared-bennetthttp://www.publicintegrity.org/2015/04/30/17261/12-things-know-about-bernie-sanders

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    This week’s news from New Jersey was, let’s be honest, probably no surprise to any veteran of Garden State politics. Some 19 months after the infamous Bridgegate scandal broke, three one-time Chris Christie allies were either indicted or pleaded guilty to a variety of conspiracy charges regarding their behavior in the matter. Just a month earlier, Sen. Robert Menendez (D-N.J.) was indicted on corruption charges for allegedly exchanging favors for gifts and campaign contributions.

    The two recent cases are but the latest in a long string of New Jersey scandals that have given the state a uniquely sleazy image in American politics. Abscam. The troubled, if brief, reign of Gov. James E. McGreevey. The 2009 conviction of the newly elected mayor of Hoboken, part of a corruption case that included a motley outfit of small-town executives, state lawmakers, building inspectors, even rabbis. The Garden State is utterly corrupt, a national joke, the storyline reads. And there’s no hope.

    But a closer look reveals a more complicated reality. Until Bridgegate, the past decade had seen few corruption charges against state-level officials in New Jersey, and that may be no coincidence; the shame of the McGreevey scandals actually led the Garden State to pass some of the nation’s strongest ethics and transparency laws in 2005. Those reforms even helped New Jersey earn the top rank, a B+, in the 2012 State Integrity Investigation, a national ranking of state government transparency and accountability by the Center for Public Integrity, Global Integrity and Public Radio International.

    Reformers say Bridgegate is a symptom of backsliding in Trenton in recent years, some of it tied to Gov. Christie's presidential ambitions. Perhaps. Bridgegate notwithstanding, however, New Jersey’s recent history may offer lessons for the growing inventory of other shamed state capitals where old-fashioned graft and cash-in-a-bag bribery cases are actually making headlines more often. Like that state capital over the river and up the Thruway in New York, for instance.

    Seeing New Jersey as a beacon of reform, of course, means challenging not just historical record, but popular culture too. Hollywood and HBO have done the state no favors, going all the way back to "On the Waterfront." "Boardwalk Empire" depicted the roots of the special relationship between mobsters and politicians, while “The Sopranos” brought us up to date. Just in case America was beginning to forget, "American Hustle" jogged our memories of Abscam, the FBI investigation from the late 1970s and early ’80s that started with fictitious Arab sheiks targeting swindlers and forgers but metastasized to engulf the mayor of Camden and seven members of Congress, including two from New Jersey.

    Yes, that really happened. And there was more: Under the McGreevey administration, the governor, several staff members and the heads of various state boards and authorities were accused of self-dealing, nepotism, misuse of state funds and other abuses. In 2004, the Star-Ledger found, the state saw one “corruption-related event” for every three days, though many of those occurred at the local level. (Many were also prosecuted by Christie’s office when he was U.S. Attorney; Christie later became governor in part by campaigning as an anti-corruption reformer.)  The “Bid Rig” scandal of 2009 rivaled Abscam in both reach and color: once again, an investigation into white-collar crime sprawled into a corruption case that netted more than a dozen public officials and political operatives, again, nearly all at the local level.

    Much was the shock, then — to its authors as much as anyone — when the Center for Public Integrity ranked New Jersey best in the nation in 2012. “Did you hear the latest joke about New Jersey?” one Hoboken-based Bloomberg columnist wrote about the state’s top rank when the Center released the report. “How did that happen? Easy. We bribed them.”

    In truth, the explanation is a bit more subtle. Importantly, the report was not a measure of corruption itself, but rather of the systems meant to prevent abuse of power and encourage transparency and accountability. To do so, the project examined not just the laws, but also whether they were effectively implemented and enforced.

    What’s more, as its name suggests, the Center’s report focused only on state government, and not on local governments, which wield great power in New Jersey, are subject to a separate, more forgiving set of laws and may still provide a nutritious agar for the petri dish of corruption. Political analysts say the state harbors an unhealthy mix of fragmented local governments, high-priced real estate and a history of transactional politics that has contributed to an attitude of entitlement and unenlightened self-interest among some office holders. And there lie the murkier cultural roots of corruption, in a form that is likely impossible to measure.

    “It’s a small state, it has a lot of valuable real estate, and local governments have very broad authority to declare parcels of land redevelopment areas,” said Brian Murphy, an assistant professor of history at Baruch College who is working on a history of political corruption in the United States. “A lot of people go into Jersey politics to get rich.”

    The “Bid Rig” scandal provides a particularly vivid peek inside that world, thanks to one Solomon Dwek, the son of a rabbi from a town called Deal — no joke — who was caught in 2006 depositing $50 million in fraudulent checks. In an effort to avoid a lengthy prison sentence, Dwek cooperated with federal officials, initially as part of an investigation into a money laundering operation run out of Deal and Brooklyn by a cabal of rabbis, one with the unlikely name of Mordchai Fish. The investigation expanded when one of the targets, a New Jersey developer, introduced Dwek to a building inspector in Jersey City who allegedly agreed to help grease the administrative wheels in exchange for payments. Dwek proved more able as an undercover agent than a fraudster, and he worked his way through a series of introductions that had him passing cash-filled envelopes to candidates, consultants and public officials from Hoboken to Trenton.

    Joseph R. Marbach, a political scientist and provost at La Salle University in Philadelphia, said New Jersey politicians’ proclivity for corruption reaches back to colonial history, when Dutch influence in the Mid-Atlantic led to a mercantile system, in which government is just another cog in the larger capitalist system. “The private sector just has to deal with the public sector to get things done,” he said. (It’s no surprise then that just over the Hudson River, New York has snatched the sleaze mantle from New Jersey for sheer number of scandals in recent years.) In New England, by contrast, a moralist, puritan attitude prevailed, leading to a view of government work as an obligation, a temporary service for citizens to complete as part of a broader career, rather than a career in and of itself, Marbach said.

    But the 2005 reforms in New Jersey appear to have had some success in reining in that “do what you gotta do” culture. After McGreevey’s resignation, acting Gov. Richard J. Codey pushed through one of the most comprehensive ethics regimes in the nation. “It was one of those post-crisis moments,” said Paula A. Franzese, a law professor at Seton Hall University who helped write recommendations for redrafting the state’s ethics laws at Codey’s request. The legislature passed nearly all of those recommendations, which included the creation of a more powerful ethics commission, mandatory ethics training, anti-nepotism laws and greater transparency in state contracts (efforts to reform local government laws have dead-ended).

    New Jersey has seen a sharp drop in state-level officials charged since then. The state’s stringent pay-to-play laws, which restrict campaign contributions from state contractors, have been emulated by Connecticut and Illinois, two other historically corrupt states that scored surprisingly well in the Center’s report.

    Just how lasting those reforms will be is unclear. Besides Bridgegate, Christie’s administration has raised doubts among ethics advocates on other fronts as well. An effort to reform the Port Authority, the agency at the center of the Bridgegate scandal, died when the state Senate failed to override a veto by Christie (New York Gov. Andrew Cuomo vetoed a parallel bill; each state must pass identical laws to reform the bi-state agency). Among other changes, the measure would have removed the two governors’ ability to each appoint an executive to the agency. Lawmakers are trying anew this year, with a bill introduced in March that will again attempt to reform the authority.

    Christie has also drawn fire for his taste for expensive travel, paid for by friends and donors such as Sheldon Adelson, the billionaire conservative casino owner, and Jerry Jones, owner of the Dallas Cowboys football team. In February, Mother Jones reported that Christie’s administration was fighting in court against 23 open records requests. And, perhaps most troubling to Franzese and other advocates, the State Ethics Commission under Christie has appointed an ally of the governor as its executive director, a post that has traditionally gone to more independent figures. “Over time,” Franzese said of the commission she once chaired, “it’s only as good as its custodians.”

    Kevin Roberts, a Christie spokesman, rejected claims that the governor exerted undue influence on the ethics director appointments, noting that the commission unanimously approved the current executive director. He also said there was nothing inappropriate or illegal about the travel gifts Christie has received.

    All of that may affect New Jersey’s score in the update to the State Integrity Investigation, on which reporters are hard at work in every state and which will be published later this year.

    But a glance around the country reveals a host of states that still look worse than New Jersey. The last two years have seen corruption-related arrests or convictions of the house or assembly speakers of Alabama, Rhode Island, South Carolina and New York. The former governor of Virginia was convicted. The governor of Oregon resigned. The former head of Mississippi’s prison system and a former state lawmaker pleaded guilty. Five current and former Pennsylvania lawmakers were arrested. As were three in California. Announcements of corruption charges no longer surprise in New York, where at least 12 sitting or former state lawmakers have been arrested, convicted, sanctioned or resigned after a host of ethical transgressions in the past two years alone.

    New Jersey still provides a glimmer of hope that states with a troubled history can reduce corruption, even if they can’t eliminate it, by passing aggressive ethics laws with strong oversight. Otherwise, fuggedaboudit.

    Chris Christie at a town hall meeting in Union City, New Jersey, on February 9, 2011.Nicholas Kusnetzhttp://www.publicintegrity.org/authors/nicholas-kusnetzhttp://www.publicintegrity.org/2015/05/01/17182/how-did-new-jersey-rank-tops-integrity

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    Editors Note: This story is part of joint investigation between the The Center for Public Integrity and The Seattle Times

    OMAHA, Neb. — Warren Buffett opened his shareholder meeting Saturday with a vigorous defense of the mobile-home business that he’s helped build into the industry’s most dominant player.

    Clayton Homes was the subject of a recent investigation by The Center for Public Integrity and The Seattle Times, which documented how the company has used predatory sales practices, exorbitant fees and home-loan interest rates that can exceed 15 percent. Because Clayton’s mobile homes often dwindle in value, borrowers find themselves trapped, unable to sell or refinance due to the punishing lending terms.

    The first question Buffett faced at his annual meeting came from a longtime shareholder in Texas who said he was having “heartburn” about issues raised in the story. The shareholder said he previously viewed Berkshire Hathaway as “an ethical company” but was concerned about Clayton and the company’s weak response to the Center for Public Integrity/Seattle Times.

    Buffett responded that the company has been exemplary in providing loans to people who often have poor credit. He said the company has no interest in providing loans that fail, since the company holds the loans on its books.

    “I make no apologies whatsoever about Clayton’s lending terms,” Buffett told the crowd of 40,000 that gathered in Omaha.

    Most Clayton mobile-home loans are considered “higher-priced” under federal guidelines, and those loans averaged 7 percentage points higher than a typical home loan in 2013, compared with just 3.8 percentage points for other industry lenders, according to an analysis of federal data.

    Clayton manufactures the homes, sells them at its retail outlets and finances them. While some borrowers have come to view the integration as a way to steer them into Clayton’s costly loan products, Buffett disputed that.

    He displayed for shareholders a document that prospective borrowers receive, listing some lending options available. What he didn’t describe was that Clayton lots are often filled with enormous banners and advertisements touting Clayton’s lending products.

    The Times/CPI story also documented how dealers had financial incentives in years past to get borrowers in Clayton loans, and one dealer described how his superior at Clayton pushed him to put at least 80 percent of buyers in Clayton loans.

    Buffett said the company has a default rate of just 3 percent “in a year,” which the company later explained was based on a calculation of the total number of defaults divided by the number of loans still on the company’s books. But that method doesn’t reflect the total default rate that occurs in loan pools over the course of time — a cumulative number that would better show the likelihood of a new borrower getting a loan that will fail.

    For example, another mobile-home lender, Origen Financial, had a pool of loans originated in 2007 that over the next eight years had an annualized default rate often below 4 percent. That loan pool’s “cumulative default” rate over eight years topped 20 percent, according to Origen’s public financial disclosures.
     
    Kenneth Rishel, an industry consultant for 40 years, has said the industrywide failure rate on nonmortgage mobile-home loans is 28 percent. Citing his own research and conversations with Clayton executives, he said Clayton’s two lenders have failure rates of 33 percent and 26 percent.

    Clayton has said those numbers are inaccurate but declined to discuss details.

    Buffett also disputed a sentence in the story that cited an affidavit explaining the company’s profit on sales in Arkansas. He noted that the numbers cited in the affidavit were “gross profit” and that it was wrong not to provide the “net profit” after expenses and taxes.

    Earlier in the day, in a brief exchange with Buffett before the event, this reporter asked the billionaire to discuss issues at Clayton. Buffett immediately replied by asking if he and the other reporter on the Clayton story were “roommates.” The reporters have never been roommates.

    Buffett then asked whether the reporter at Saturday’s event has a sister who works as a lawyer. This reporter has no sister who is a lawyer, but co-writer Daniel Wagner has a sister who works as an attorney at a nonprofit law firm in West Virginia that has brought suits on behalf of low-income borrowers against most major home-loan lenders, including Clayton.

    Wagner is an award-winning journalist who has reported on consumer finance for a decade, including two years at The Center for Public Integrity, and was one of the lead Associated Press journalists covering the 2008 financial crisis.

    Buffett’s Berkshire Hathaway purchased Clayton Homes in 2003. It now constructs nearly half the industry’s new homes and finances more mobile-home purchases than any other lender by a factor of size.

    Last year, Clayton earned $558 million before taxes.

     

    Dan Wagner contributed to this story.

     

    Billionaire investor Warren Buffett holds an ice cream bar from Berkshire Hathaway subsidiary Dairy Queen as he talks to Kevin Clayton, CEO of Clayton Homes, also a Berkshire subsidiary, in Omaha, Nebraska before a shareholders meeting in May, 2014.Mike Bakerhttp://www.publicintegrity.org/authors/mike-bakerhttp://www.publicintegrity.org/2015/05/02/17286/buffett-sticks-mobile-home-business-shareholder-meeting

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    Michigan voters will decide on Tuesday whether the state should raise its sales tax from 6 percent to 7 percent to pay for repairs for the state’s roads and bridges.

    The measure has attracted more than $8 million, with the construction industry and unions backing the "yes" side and anti-tax advocates fighting it. It’s not uncommon for ballot measures to be expensive endeavors dominated by deep-pocketed parties who stand to reap financial benefits from the outcome.

    In this case, the ballot measure is expected to raise an additional $1.2 billion annually for road and bridge improvements, as well as about $600 million more per year for schools, local governments and public transit. It would also eliminate the state’s sales tax on gasoline while creating new fees for electric and hybrid cars.

    It also has caused a split among some conservatives in the state. Republican Gov. Rick Snyder supports the measure, as do several local chambers of commerce. But some of the opponents are prominent members of the GOP.

    Here are nine things to know about the money behind the measure:

    • Safe Roads Yes has reported raising more than $8 million, including at least $5 million from the construction trade group Michigan Infrastructure & Transportation Association, according to state records.
    • Other major backers include electric company ITC Holdings Corp. and a new nonprofit called Michigan Energy First, which have each given $250,000 to the group.
    • Five political committees oppose Michigan’s measure, including one funded primarily by 2014 GOP congressional candidate Paul Mitchell, state records show.
    • Donating more than $420,000, Saginaw businessman Paul Mitchell is the top contributor to opposition of Michigan's ballot measure.
    • Even though Gov. Rick Snyder supports the measure, one of his longtime political advisers spent $10,000 opposing it, state records show.
    • Nearly 70 percent of the $7.2 million that Safe Roads Yes has reported spending so far has gone to WWP Strategies, a Michigan-based media consultancy that has worked on several GOP campaigns.
    • The estimated $1.5 million spent so far on TV ads about Michigan’s ballot measure is less than the $2.1 million and $2.8 million spent for the state’s two ballot measures in 2014.
    • The Safe Roads Yes committee has aired TV ads supporting Michigan’s proposal nearly 4,000 times for an estimated cost of $1.5 million, according to a Center for Public Integrity analysis of data from media tracking firm Kantar Media/CMAG.
    • Ads have been airing all over the state in favor of the measure, but TV stations in the Grand Rapids and Detroit markets have aired the greatest number, the data show.

    Sources: Center for Public Integrity analysis of data from media tracking firm Kantar Media/CMAG, Michigan campaign finance records, Associated Press 

    Rachel Bayehttp://www.publicintegrity.org/authors/rachel-bayeJared Bennetthttp://www.publicintegrity.org/authors/jared-bennetthttp://www.publicintegrity.org/2015/05/04/17271/michigan-ballot-measure-fight-attracts-more-8-million

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    Remember Blockbuster?

    In its heyday—which wasn’t so long ago—Blockbuster had 60,000 employees and 9,000 locations. For most Americans, for a minute anyway, it was the place to rent a movie.  Then along came Netflix. And Redbox, which operates most of the movie-rental kiosks in convenience and grocery stores.

    Before you knew it, Blockbuster was no longer a necessity.  All of a sudden, it seemed, we could get the video entertainment we wanted faster and cheaper and, at least with Netflix, without having to leave the comfort of our homes. In 2010, Blockbuster filed for bankruptcy, just 25 years after it was founded. By last year, the last of those 9,000 stores had closed.

    What will be the next Blockbuster? It very well might be your health insurance company, says Steven Brill, the entrepreneur and journalist whose 26,000-word Time magazine cover story about the absurdly high costs of American health care captured the nation’s attention two years ago.

    “I see insurance companies as the weak players” in the U.S. health care system, Brill told me in a recent interview. By that he meant that insurers have become increasingly impotent middlemen in the battle to rein in health care costs.

    “Aetna is Blockbuster,” Brill wrote in his latest book, America's Bitter Pill: Money, Politics, Backroom Deals, and the Fight to Fix Our Broken Healthcare System.

    He was quoting Ezekiel (Zeke) Emanuel, former health policy advisor in the Obama administration who is now a vice provost at the University of Pennsylvania.

    Brill explained that what Emanuel meant “was that just as the video rental giant got overtaken by upheavals in how media is delivered, large insurers such as Aetna are going to be overtaken by changes in the structure and delivery of health care.”

    As Brill notes, many of those changes were set in motion by the Affordable Care Act, which is making it necessary for doctors, hospitals and other health care providers to work together more collaboratively. Increasingly, Medicare and other payers are reimbursing health care providers based on how well they care for us rather than on how many separate, billable things they do to us.

    As a consequence, hospitals are having to operate more efficiently, which is leading to a consolidation in the industry. There were 95 mergers just last year alone. That’s 44 percent more than in 2010, the year Congress passed health care reform.

    The pace of consolidation among hospitals actually began to pick up in the years leading up to Obamacare.  Hospitals started merging partly in response to rapid consolidation among health insurers. In 1985, the year Blockbuster was founded and the year I started my career in health care at a hospital in Tennessee, few people, including me, had ever heard of UnitedHealth. Today, as a result of a long string of acquisitions, UnitedHealth Group is the nation’s largest insurer and, according to Fortune, the 14th largest U.S. company of any kind.

    Aetna, Cigna, Humana and WellPoint, the other big insurers, also bulked up through acquisitions. As they got bigger, they had more leverage with hospitals during annual negotiations that determined how much insurers would pay for medical services.

    In self-defense, hospitals began to get bigger themselves. As a consequence, even UnitedHealth is now often forced to pay whatever the big hospital systems demand.

    Not only have hospitals in many cases regained the upper hand during reimbursement negotiations, a growing number of them have started operating their own health plans.

    “I think it’s inevitable that most hospitals and hospital-based health care system will be selling their own insurance,” Brill told me.

    I agree.  It’s a “back to the future” phenomenon. The forerunner of today’s Blue Cross companies started out as an insurance plan developed by Baylor Hospital in Dallas. And the hospital I worked for in Tennessee back in the ‘80s had its own HMO for a while. Many hospitals did. Most of them failed, however, because hospital executives didn’t know as much as they thought they did about running an insurance company.  The hospitals that are getting back into the insurance business today seem confident they won’t repeat the mistakes of 30 years ago.

    Consolidation among hospitals is creating oligopolies in many markets, but Brill doesn’t believe that’s necessarily bad, nor is he reflexively against hospitals  becoming insurers.  The disappearance of insurance companies—at least as we know them today—doesn’t worry him. For one thing, today’s health insurance company as middleman adds billions of dollars in administrative costs to the system that, theoretically, would go away when Aetna and the other firms go the way of Blockbuster.

    The question becomes, ‘How well will these oligopolies be regulated?’” Brill says. “How will I know, for example, that they won’t skimp on my care?”

    Hospitals will have to be regulated in ways they haven’t been regulated before, he says. There will need to be standard-of-care regulations. And limits on profit margins.

    Brill believes that if those and other regulations can be put in place, quality of care will go up and costs will come down. If they aren’t, however, we may be worse off than we are now.

    Wendell Potter is the author of Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR is Killing Health Care and Deceiving Americans and Obamacare: What’s in It for Me? What Everyone Needs to Know About the Affordable Care Act.

    Wendell Potterhttp://www.publicintegrity.org/authors/wendell-potterhttp://www.publicintegrity.org/2015/05/04/17285/health-insurers-may-go-way-blockbuster

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    To Berkeley for the #logansymposium2015, an investigative journalism conference funded by the Reva & David Logan Foundation, which has been a major historic backer of the Center for Investigative Reporting and Lowell Bergman’s Investigative Reporting Program at the university. 

    One of the most impactful comments for me came from one of the more discreet participants, Elspeth Revere from the influential MacArthur Foundation [fully, the John D. and Catherine T. MacArthur Foundation], a backer of Public Integrity. In a closing panel on the future of investigative reporting, she gave three measures for how she looks at the value of MacArthur grants to investigative reporting outfits, adding “we’re not very measurement oriented”.

    She said she looks first at “reach” but based on the recipient’s own metrics,  not new metrics imposed by her group. Secondly she looks at “prestigious prizes” to reflect industry and professional recognition of quality. Thirdly,  and she recognized most long term: policy change.

    Reassuringly, Elspeth, in regard to support for investigative journalism, said  “no one questions your right to be in this”, adding she felt investigative journalism was “one of the very good uses of philanthropic money”.

    Measurement of impact and a focus on dissemination of investigative reporting to the widest possible audience are huge issues for donors and nonprofit investigative outlets right now, driven in large part by pressure on donors for greater evidence of their own effectiveness.

    "Earned income" at Texas Tribune

    Also at the #logansymposium2015, the digital analytics platform Chartbeat and CIROnline.org engagement fellow Lindsay Green-Barber [like our own Emily Dufton a PHD fellow from the ACLS] gave powerful presentations on tracking the immediate and longer term impact of our work. CIR, for example, found that once a particular project hit the Hispanic community, its impact spread rapidly and in ways which it had not previously detected.

    I’m also a strong believer in advertising and earned-income being good indicators of your level of support, so it was interesting to hear the impressive editor of the Texas TribuneEmily Ramshaw, say that the Tribune is getting up to 20 per cent of its income from commercial sources including sponsorship and events and that it has guidelines based on outward-facing transparency it hopes protects it from criticism. The Texas Tribune apparently makes as much as $1.3m from a single three-day event on policy and politics. Some clear lessons for us.

    Other tidbits which got me at the conference:

    • Diversity: a “Rooney rule” under which all short lists must contain a minority candidate. Diversity as a reporting issue: how can you make the judgments or get the stories without having a workforce from minority communities.
    • Comic-style story-telling: this work from Illustrated Press was perhaps the simplest and yet most imaginative way to get stories across to new audiences I saw —and far less complex and costly than many.
    • BuzzFeed, which has taken two of our best reporters, now has 17 dedicated investigative reporters and has discovered a couple of truths we could all do with considering in our writing. Said BuzzFeed’s Mark Schoofs: "The nut graph turns out to be really important.

    Do we need an anecdotal lead and do we have enough to support it?

    Impact and innovation

    A good example of the impact of a great story and some innovation, is the follow up to Susan Ferriss’ superb anger-generating piece on the treatment and incarceration of kids. I wrote about this a note ago. A petition on Change.org about this now has more than 84,000 signatures. It’s also generated an interesting internal debate about our role in raising awareness when it spreads into that sort of advocacy. On the innovation front Susan’s piece was last week’s release in the Reveal podcast we have partnered with the CIR on.

    Herograms for our team

    Mike Hudson and the ICIJ team involved in last year’s #luxleaks expose of the role of Luxembourg in facilitating mass tax avoidance has today been named the business category winner of the New York Press Club journalism awards — reinforcing Elspeth’s metric. This recognition is I hope only a taster of what will come in response to the HSBC #swissleaks story. Remember, they already won a Polk for #offshoresecrets. It is also worth noting Gerard Ryle’s important comments on the charges filed last week against a reporter on #luxleaks Edouard Perrin. Gerard said: “For a founding member of the EU to bring charges against a journalist in relation to reporting that is clearly in the public interest shows a lack of respect for the important role journalism plays in holding the powerful accountable.”

    Executive Editor Gordon Witkin wanted to note the work of health reporter Fred Schulte in digging out health whistleblowers. He also notes, as do I, that we’ve become much faster off the mark in engaging in major news events, notably more on campus sexual assault from Kristen Lombardi in which Joe Biden made clear the problem is real. A personal favorite was Allan Holmes’ thoughtful and timely intervention in the Comcast/Time Warner Cable deal, a superb analysisNick Kuznetz showed how lame Virginia’s new ethics plans are after a scandal there.

    Environment editor Jim Morris noted that the indefatigable Jamie Smith Hopkins harried the EPA until it confirmed the premise of her story that burning off gas from flares may be far more dangerous than thought.

    What we’re reading

    Our Money & Politics Editor and former Bloomberg reporter Alison Fitzgerald says she’s reading Bad Paper: Chasing Debt from Wall Street to the Underworld, by Jake Halpern. Says Alison: “The book is populated with drug dealers, Vegas swindlers and armed thugs who make up the bottom rung of the debt collection industry. They buy charged off credit card debt from mainstream banks that we all do business with and hope to make their fortunes bullying people into paying up.”

    Items I’ve noted in the past week include Guardian Washington reporter Dan Roberts with a colorful piece on who was behind the U.S./Cuba deal and a superb ProPublica investigation into what was known ahead of the Mumbai terror attacks. Also worth reading this piece from the 

    Chronicle of Philanthropy about online revenue rising at non-profits.

    Federal court records show at least a half dozen whistleblower lawsuits alleging billing abuses in these Medicare Advantage plans have been filed under the False Claims Act since 2010.Peter Balehttp://www.publicintegrity.org/authors/peter-balehttp://www.publicintegrity.org/2015/05/04/17297/good-use-philanthropic-money

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    Mike Huckabee threw his hat into the ring for the White House today, the second time the Republican from Arkansas has sought the presidency.

    The former governor of Arkansas ran in 2008, winning the Iowa Republican caucuses and primaries in seven other states, but he decided not to enter the 2012 race.

    This time, he’s been paving the way for months. He launched a nonprofit advocacy group this fall, wrapped up his Fox News show in January and announced plans in April to stop his radio broadcast.

    Here’s more about the financial background of the man who could be the nation’s second president from Hope, Arkansas:

    Sources: Center for Public Integrity reporting, as well as Amazon.com, Associated Press, Bloomberg News, Center for Responsive Politics, MSNBC, New York Times, National Institute on Money in State Politics and Washington Post

    Image sources: Gage Skidmore/Flickr, Justin Higuchi/Flickr

    Kytja Weirhttp://www.publicintegrity.org/authors/kytja-weirJared Bennetthttp://www.publicintegrity.org/authors/jared-bennetthttp://www.publicintegrity.org/2015/05/05/17180/9-things-know-about-mike-huckabee

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    U.S. Army Specialist Stephanie Charboneau sat at the center of a complex trucking network in Forward Operating Base Fenty, near the Afghanistan-Pakistan border, that daily distributed tens of thousands of gallons of what soldiers called “liquid gold”: the refined petroleum that fueled the international coalition’s thirsty vehicles, planes, and generators.

    A prominent sign in the base read: “The Army Won’t Go If The Fuel Don’t Flow.” But Charboneau, 31, a mother of two from Washington state, felt alienated after a supervisor’s harsh rebuke. Her work was a dreary routine of recording fuel deliveries in a computer and escorting trucks past a gate. But it was soon to take a dark turn into high-value crime.

    She began an affair with a civilian, Jonathan Hightower, who worked for a Pentagon contractor that distributed fuel from Fenty, and one day in March 2010, he told her about “this thing going on” at other U.S. military bases around Afghanistan, she recalled in a recent telephone interview.

    Soldiers were selling the U.S. military’s fuel to Afghan locals on the side, and pocketing the proceeds. When Hightower suggested they start doing the same, Charboneau said, she agreed.

    In so doing, Charboneau contributed to thefts by U.S. military personnel of at least $15 million worth of fuel since the start of the U.S. war in Afghanistan. And eventually she became one of at least 115 enlisted personnel and military officers convicted since 2005 of committing theft, bribery, and contract rigging crimes valued at $52 million during their deployments in Afghanistan and Iraq, according to a comprehensive tally of court records by the Center for Public Integrity.

    Many of these crimes grew out of shortcomings in the military’s management of the deployments that experts say are still present: A heavy dependence on cash transactions, a hasty award process for high-value contracts, loose and harried oversight within the ranks, and a regional culture of corruption that proved seductive to the American troops transplanted there.

    Charboneau, whose Facebook postings reveal a bright-eyed woman with a shoulder tattoo and a huge grin, snuggling with pets and celebrating the 2015 New Year with her children in Seattle Seahawks jerseys, now sits in Carswell federal prison in Fort Worth, Texas, serving a seven-year sentence for her crime.

    Additional crimes by military personnel are still under investigation, and some court records remain partly under seal. The magnitude of additional losses from fraud, waste, and abuse by contractors, civilians, and allied foreign soldiers in Afghanistan has never been tallied, but officials probing such crimes say the total is in the billions of dollars.

    Those numbers might not seem huge — at least a million troops rotated through the region in this period, and the overall U.S. budget for these wars has so far exceeded $1.5 trillion — but those who investigate and prosecute military wrongdoing say the convictions so far constitute a small portion of the crimes they think were committed by U.S. military personnel in the two countries.

    Former Special Inspector General for Iraq Reconstruction Stuart Bowen, who served as the principal watchdog for wrongdoing in Iraq from 2004 to 2013, said he suspected “the fraud … among U.S. military personnel and contractors was much higher” than what he and his colleagues were able to prosecute. John F. Sopko, his contemporary counterpart in Afghanistan, said his agency has probably uncovered less than half of the fraud committed by members of the military in Afghanistan.

    As of February, he said he had 327 active investigations still under way, involving 31 members of the military. “You don’t appreciate how much money is being stolen in Afghanistan until you go over there,” said Sopko, who says price-fixing and other forms of financial corruption are rampant in the country.

    These and other experts, as well as some of those who have pleaded guilty to criminal wrongdoing, point to some recurrent patterns in the corrupt activity, which in turn illustrate the special challenges created when a sizable military force is deployed so far from lawful domestic routines. Sometimes ill-trained military personnel were given authority for making large cash transactions, in a region where casual corruption in financial dealings — bribes, kickbacks, and petty theft — was commonplace. Commanding officers, they add, were typically so distracted by urgent war challenges they could not carefully check for missing fuel or contractor kickbacks.

    So far, officers account for approximately four-fifths of the value of the fraud committed by military personnel in Iraq, while in Afghanistan, the ratio was flipped, with enlistees accounting for roughly the same portion, according to the Center’s tally. The reasons for the difference are unclear. But Sopko said he expects more officers to be investigated for misconduct in Afghanistan as the U.S. military mission there continues, so the ratio could change.

    Soldiers who had little or no prior criminal history, like Charboneau, say the circumstances of their deployments made stealing with impunity look easy, and so they made decisions that to their surprise eventually brought them prison sentences ranging from three months to more than 17 years. Many, like Charboneau, were savvy about the military’s way of doing things – her mother, her first husband and her second husband were service members, according to a statement her lawyer, Dennis Hartley, filed on Jan. 30, 2014, before her sentencing.

    They say that they knew of other military personnel who also broke the law, but without getting caught. Hightower convinced her to steal fuel from Fenty, Charboneau said, by pointing out that the soldiers at nearby bases “aren’t getting caught, so you shouldn’t have to worry about it.”

    Retired Army Reserve Maj. Glenn MacDonald, whose reports about fraud, waste, and abuse in the military reach a monthly Web audience of up to 6 million, said the volume and value of fraud committed by soldiers in Afghanistan and Iraq seems higher to him than what he recalled as a young soldier in Vietnam in the 1960s.

    MacDonald, 68, editor-in-chief of the website MilitaryCorruption.com, co-founded the site after a 33-year career in the Army and Army Reserve during which he says he witnessed many small instances of corruption. “What you can make out of these [recent] wars is staggering. It’s an opportunity for anybody, even a non-commissioned officer, to become very rich overnight,” MacDonald said.

    Many have probably been tempted, he said, because they saw others getting away with the theft of thousands or even millions of dollars.

    Pocketing thousands in cash from illicit fuel sales

    Military fuel in Iraq and Afghanistan has been a perennial target of theft during the past 14 years of war. In Afghanistan, fuel moved around the country in “jingle trucks,” tankers adorned with kaleidoscopic patterns and metal ornaments. At Fenty, for example, jingle trucks bearing fuel arrived every few days from suppliers in Pakistan, all driven by locals under contracts with the base. Officers at Fenty then distributed it to 32 nearby bases, with the largest ones using up to 2 million gallons of fuel a week.

    To describe the system as loosely controlled might be an understatement: Standard contracts allowed each driver to take seven days to bring the fuel to a destination that might be only a few hours away, according to Army Maj. Jonathan McDougal, who oversaw motor vehicle logistics in northeast Afghanistan in 2010 and 2011 from Bagram Airfield. “It was like they planned for something to go wrong with every convoy,” McDougal told the Center.

    Fuel pilferage was the “leading cause” of failed deliveries, according to McDougal. One out of every three truck convoys would lose, on average, about 11,000 gallons of fuel, amounting to more than 800,000 gallons of lost fuel during his 12 months in the country. Military vehicles would sometimes accompany the jingle truck drivers, but if the trucks carrying the fuel left the foreign troops’ designated safe routes — to get lunch in a nearby village, for example — the military escorts would just “have to let them go,” he said.

    Charboneau’s role in the Fenty fuel theft ring was simple. She ordered trucks to transport more fuel than needed, then filed fake records showing the extra fuel had been delivered to a base. After leaving Fenty in a convoy, the extra trucks diverted their loads to prearranged meeting spots, where buyers offloaded the fuel and paid in cash, with the proceeds divided later among Charboneau and her co-conspirators. The scheme worked – for a while – because the fuel storage amounts and truck delivery amounts matched (although of course the bases’ records of delivered fuel did not).

    This represented, Charboneau said, “a big gap” in the fuel oversight system. And the rewards were enticing — around $5,000 in net profit from a single extra truckload.

    Charboneau already felt, she said, “lost all the time” in her job at the base. Her life had not been easy up to that point, either. As a child, she spent years living with an aunt and experienced financial instability, according to the 2014 sentencing statement. She became pregnant with her first child, Zander, while still a teenager.

    One month after she joined the scheme, according to the government’s sentencing memo, filed on Jan.15, 2014, in U.S. District Court in Colorado, her supervisor, Sgt. Christopher Weaver, jumped in. She described the widening of the conspiracy in instant messages intended for her sister in Colorado, sent using the screen name “dollface_kc”:

    Although prosecutor Mark Dubester said in the sentencing memo that Charboneau’s use of the term “lmao” (Internet slang for “laughing my ass off”) demonstrated that she “saw humor in the situation,” Charboneau said she did not. When she returned to Fenty, she said, Weaver pulled her aside and told her that he knew how everything worked, and while he had not made much money off of the scheme so far, it would be wise of her to keep her mouth shut.

    “It was … one of those things that, ‘if you tell anybody, you’re probably going to be sorry,’” said Charboneau. “I was his subordinate. He was in charge.”

    “Thereafter, the conspiracy continued with all three involved, and this is when the bulk of the thefts occurred,” according to the sentencing memo that Dubester submitted. Weaver met with Charboneau and Hightower each morning to decide which trucks would make legitimate deliveries and which trucks were “going to go get stolen,” Charboneau said in the interview.

    If someone had simply asked more questions about the deliveries — such as “‘I need to know where you’re sending these 15 trucks. Oh, you don’t have a destination for these five?” — it would have been much harder to pull off the scheme, Charboneau said. She, Weaver, and Hightower were able to continue stealing as long as they did, she said, because they were the only three people entrusted with keeping track of where the fuel went when it left the base.

    Digital monitoring could also have stopped theft at military bases, she said. Scanning the fingerprints of the drivers when they left Fenty and arrived at the destination bases, for instance, would have deterred them from selling it on the side, according to Charboneau.

    Weaver pleaded guilty to counts of conspiracy and bribery on Oct. 10, 2012, and is now serving a sentence of three years and one month in a federal prison in South Dakota. His former attorney declined to speak on the record about the case. In a letter to Chief U.S. District Judge Marcia Krieger that Weaver filed with an October 2013 sentencing statement, Weaver wrote that he had originally taken the money to hire a lawyer because his “child’s mother was threatening to take my son away from me.”

    “Of course, I took more than was needed,” he added. “I got greedy once I started.”

    Hightower also pleaded guilty to conspiring to defraud the United States, and was sentenced on Oct. 28, 2013, to two years and three months in prison. He is serving his term in a federal prison in San Antonio, Texas.

    The thefts alone caused more than $1.5 million in losses to the United States, according to the plea agreement that Charboneau eventually signed on Sept. 5, 2013. Her attorney, Hartley, told the court that her crime had also humiliated her husband, whose own Army unit had learned about it.

    Charboneau said she is now haunted by how “I was so proud to be in the military, [and then] doing what I did.” After seven years as a soldier, trained to respect and trust her supervisors completely, she said, it was “really hard” to find out that a superior was engaging in theft.

    Her advice to young soldiers deploying to Afghanistan today would be to “keep to themselves, learn the job that they need to learn,” and if confronted with a proposal similar to the one Hightower laid at her feet, just say no. “It wasn’t worth the forty-some-odd thousand dollars I made to be in prison for seven years, to be away from my…family,” she said.

    Charboneau started serving her sentence in February, after a court-approved delay of five-and-a-half months, so she could briefly take care of her third child, Tate, who was born last July; all three of her children are now being looked after by her mother. In an email to the Center, Charboneau wrote that she was “adjusting alright” to prison but missed her kids, especially her newborn. “I’m afraid most days he will forget me,” she wrote.

    A tangle of emotions and crime

    Court filings in more than 100 cases reviewed by the Center show that many of the military personnel who wound up being convicted had earlier received honors and awards, and were well-regarded by their uniformed colleagues. Charboneau, for instance, won two medals for her service in the Fenty operations office. She received the first just months before she began stealing fuel with Hightower and Weaver.

    So what makes such military personnel turn to crime?

    The inspectors general for both warzones said criminal actions were provoked partly by the high volume of cash and resources flowing into the countries. “The more money you throw into a weak-rule-of-law situation, the more fraud you’ll see,” said Bowen.

    Todd Conormon, a lawyer who served in Iraq in 2004 and now defends service members accused of wrongdoing, said that for some, the sheer pressure of combat “has a debilitating effect, and maybe makes it easier…to rationalize, ‘Well, I deserve this.’ ” Others grew used to seeing corruption all around them — like the widespread financial impropriety Sopko described — and convinced themselves that a little more wouldn’t interfere with the essential goals of the U.S. mission, Conormon said.

    For some, the urge to steal was wrapped up in other temptations, such as an illicit romance with another service member, according to court documents.

    An Army captain from Tacoma, Washington, named Cedar Lanmon, who served in Iraq on two deployments from 2004 to 2007, accepted gifts worth tens of thousands of dollars in exchange for helping the Albanian owner of a company called “Just in Time Contracting” obtain a $250,000 contract from the U.S. military, according to a complaint filed against him on Nov. 15, 2007, by U.S. Army Criminal Investigative Division Special Agent Derek Lindbom. He wound up getting caught after his estranged wife — referred to by her first initial “T” in the complaint — called Lindbom’s agency to describe her husband’s misdeeds, financial and marital:

    After Lanmon proposed that his wife join him and the new girlfriend in a “polygamous marriage,” according to the document, the couple “became estranged as husband and wife.” Lanmon served one year in federal prison and was released on Sept.11, 2009. A Washington state phone number under his name had been disconnected when the Center for Public Integrity tried to reach him.

    Other fraud schemes in Iraq and Afghanistan occurred with the full knowledge — and sometimes the complicity — of the service member’s spouse. U.S. Marine Corps Capt. Eric Schmidt and his wife, Janet, both from California, engaged in theft and contract fraud during his deployment as a contracting officer at Camp Fallujah in Iraq in 2008 and 2009. They netted a total of $1.69 million, according to the sentencing memo that Assistant U.S. Attorney Dorothy McLaughlin filed in the U.S. District Court for the Central District of California on Feb. 3, 2011.

    They were an efficient team. Eric helped Iraqis pilfer equipment from the base, such as generators and air conditioners, and steered military reconstruction contracts to one local firm in particular, according to the sentencing memo.

    Janet arranged for U.S. companies to supply smaller quantities or substandard versions of the equipment that the chosen Iraqi firm was supposed to be producing, the sentencing memo said. When the products arrived in Iraq, Eric signed a Defense Department form stating that the shipments had been sent by the Iraqi firm. The firm then sent the U.S. government a bill Janet had prepared, and when it was paid, the firm shared the proceeds with the Schmidts.

    The scheme escaped notice during the year Schmidt was deployed to Iraq, according to Daniel F. Willkens, a former head of investigations for Bowen. Schmidt even roped in two subordinate Marines to help him with the scheme, according to the sentencing memo. One of them, Staff Sgt. Eric Hamilton, received $124,000 from Schmidt and the Iraqi contractors for painting circles on generators in the military storage yard at Fallujah to show which ones they could take, and then unlocking the gate when the contractors came to get them, according to charges filed in the U.S. District Court for South Carolina on July 27, 2011, by U.S. Attorney William Nettles. Hamilton pleaded guilty to the charges on Aug.10, 2011, according to his plea agreement.

    Schmidt was “judge, jury, and prosecutor of his operation,” said Willkens. “There were no checks, no balances.”

    The couple was caught by chance. In 2009, five months after Eric Schmidt had returned to the United States and the couple had purchased costly property in California, Schmidt was arrested for assaulting his wife. While state police were inside the home, they noticed he had $10,000 in cash, and that the bills were stamped with the imprint of an Iraqi bank.

    Investigators from Bowen’s agency, the Pentagon and the IRS were eventually able to confirm the money had come from Iraq and pieced together the rest of the story by examining the Schmidts’ financial transactions and correspondence. In the last report that Bowen’s agency submitted to Congress, in September 2013, the Schmidts’ case was described as the “biggest catch” of a special data mining team in his agency. In 2011, Eric Schmidt was sentenced to six years in prison, while his wife was sentenced to one year of home confinement and two additional years of probation. The couple was ordered to pay the U.S. government $2.1 million in restitution, including income tax.

    “Most of our cases were triggered by unexpected tips [revealed by] someone who had their conscience pricked and came forward,” said Bowen. Because the whistleblowers could be endangered by receiving public credit, they are rarely mentioned in court documents.

    Sopko confirmed that most of the cases his agency successfully investigates come from tips, when service members call government corruption hotlines or when disgruntled representatives of military services companies come forward to complain that a rival seems to be getting all the prime contract awards. Charboneau’s scheme, for instance, was uncovered after Weaver talked about it with a sergeant with whom he was romantically involved, she said.

    In Afghanistan, Sopko and his investigators typically use sources, undercover techniques and firsthand testimony. Because record-keeping in the country has been poor, he said, “we don’t just rely on paper.”

    The contract fraud model

    One exception was an elaborate contract rigging scheme that culminated in the longest prison sentence given to any U.S. service member for fraud in Iraq or Afghanistan.

    It began, according to court documents, as Army Maj. Eddie Pressley arrived at Camp Arifjan in Kuwait in October 2004 to work as a contracting specialist, ordering supplies for the base. Just before his arrival, he had received an Army Commendation Medal for exceptional service as a military recruiter.

    His roommate at the base was another Army major, John Cockerham, who reviewed and awarded bids for Defense Department contracts to support the U.S. Army’s operations around the Middle East. By the time Pressley arrived, Cockerham had already been at the camp for three months — and had begun awarding contracts for goods such as bottled water in exchange for bribes, according to an indictment filed by a San Antonio grand jury against Cockerham on August 22, 2007.

    During a trial hearing on Dec.12, 2009, Cockerham’s attorney, Jimmy Parks, said Cockerham agreed to participate in these schemes after a “lot of cajoling and convincing” by contractors, who told Cockerham that “our God requires that we bless you” for giving them “a chance to do business.” Assistant U.S. Attorney Mark Pletcher responded that the payments had not been blessings, “just bribes.”

    By March 2005, Pressley was likewise collecting bribes for awarding contracts and ordering extra goods under those contracts, according to the indictment that an Alabama grand jury filed against him on May 1, 2009. The men arranged for their wives to visit, collect the cash profits, and take the money home or send it to foreign bank accounts.

    When an Army major and West Point graduate named James Momon arrived in the summer of 2005, Pressley and Cockerham took him for a ride in their jeep and described how their bribery scheme worked, according to descriptions of sealed testimony by Momon that federal prosecutor Peter Sprung and Pressley’s attorney, Clyde Riley, gave at February 2011 court hearings in Decatur, Alabama. According to Sprung, Momon said Cockerham and Pressley explained how they got the bribe money from the contractors, and how their wives and relatives helped move the illicit funds out of the country.

    Court records and published reports by Bowen’s agency do not detail how the investigation began, but in late December 2006, federal agents executed a search warrant on Cockerham’s San Antonio home and discovered what they said was a highly incriminating ledger.

    Cockerham had a compulsion to write down “everything from his dreams to the amounts of money he took,” according to Willkens. He neatly listed the names of contracting companies that paid him bribes, along with the values of the bribes he had already received and those he expected to receive. Of the $15 million he eventually hoped to receive in bribes, Pletcher told the court in the 2009 hearing, Cockerham had designated 10 percent to be used for building a church.

    In total, Cockerham, Pressley and Momon collected at least $14 million in bribes, according to court documents detailing the conduct of which they were convicted. Cockerham ended up receiving 17½ years in prison, the longest sentence given to any service member convicted of fraud in the two countries. At least seven other soldiers in Iraq and Kuwait were convicted of participating in the conspiracy. A military-veteran-turned-contractor who investigators say played a pivotal role in the case, George Lee, pleaded guilty in February to paying a bribe to one of the lieutenants and is now in a Philadelphia jail.

    The conspiracy — and the suicide of an Army officer who killed herself in 2006 after confessing to federal agents that she had accepted at least $225,000 in bribes from Lee — have garnered wide attention.

    The challenges of bringing a successful case in the middle of war

    Sopko and others warn that the steady flow of military reconstruction funds into the two countries will not soon subside, with the deployment of 10,000 U.S. forces in Afghanistan recently extended to 2016, and new aid and military personnel starting to return to Iraq.

    But auditors working for Sopko’s agency face increasing restrictions in Afghanistan. Military officials have told Sopko’s agency they would only provide civilian investigators access to areas within a one-hour round trip of an advanced medical facility, so that the U.S. government can provide them “adequate security and rapid emergency medical support,” according to a report Sopko’s agency issued in 2013. As a result, in 2014, Sopko’s investigators were only able to access one-fifth of the country.

    Moreover, because the U.S. embassy in Kabul is shrinking, Sopko has been instructed by the State Department to cut his staff there by 40 percent, to just 25 positions, by mid-2016 — a dictum he says will hamper his ability to monitor wrongdoing by federal personnel. Everyone in Afghanistan, including his on-the-ground investigators, Sopko wrote in his agency's report, will struggle over the next few years “to continue providing the direct U.S. civilian oversight that is needed in Afghanistan.”

    Investigators say that even now, some service members whom they strongly suspect of fraud wind up getting away without prosecution because they simply cannot muster the evidence to bring them to trial, or because they prefer to go after large cases while letting smaller ones go.

    In Iraq, recalled Willkens, he and his fellow investigators were sure they had uncovered the culprits behind certain lucrative crimes, but were equally sure they would not be able to prove it because the proceeds were stashed in inaccessible overseas accounts.

    Bowen and Willkens also complained that stiff penalties were not assessed as often as they wished. “I suspected that many of these guys that we caught were perfectly happy to go to prison for a few years,” because they had much more money stashed overseas in places with little banking regulation, Bowen said, such as Cyprus or Jordan. “Prison was the cost of doing business for them.”

    Other oversight officials confirmed that the amounts of money the U.S. government receives from service members convicted of fraud is rarely commensurate with their crimes. Restitution or forfeiture are set at whatever levels the judge decides is deserved, within the sentencing guidelines. In bribery schemes, for example, it is “often difficult to define specifically the loss to the government,” according to Peter Carr, a U.S. Justice Department spokesman.

    Part of the challenge, according to Willkens, is that fraud is seen as a white-collar, non-violent crime. If the service members who stole millions from the U.S. government had taken the same amount during an armed robbery of a bank, he said, they would receive much higher penalties.

    “Robbing the government is seen as a victimless crime,” Willkens added. “It’s not.”

    This story was co-published with Slate

    A sign at Forward Operating Base Fenty, near the Afghanistan-Pakistan border.Julia Hartehttp://www.publicintegrity.org/authors/julia-hartehttp://www.publicintegrity.org/2015/05/05/17268/us-military-personnel-have-been-convicted-50-million-worth-crimes-iraq-and

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    Another day, another jolt to the precarious credibility of New York’s political system. State Senate President Dean G. Skelos of Long Island was arrested Monday morning, marking the latest in a steady stream of corruption cases to emerge from the Empire State.

    Skelos and his son, Adam, were charged by federal prosecutors with multiple counts of conspiracy, bribery and extortion as part of an alleged scheme to leverage the senator’s power to enrich his son.

    In a statement, the senator said Monday that he is “innocent of the charges leveled against me.”

    The federal complaint details a broad and complex alleged campaign dating back to 2010 to win business for the younger Skelos, primarily through the influence of a powerful real estate development firm. Drawing on emails, tapped phone conversations and information provided by two cooperating witnesses, prosecutors say the elder Skelos asked the developer, Glenwood Management, to provide business to his son but asked that the money not come directly from Glenwood.

    The complaint says the younger Skelos eventually received more than $200,000 this way, though most of the money actually came through an environmental wastewater treatment company in which Glenwood’s founder and a top executive were investors. The money was a coup for Adam Skelos who, according to the complaint, acknowledged to an executive at the environmental company that he “literally knew nothing about water or, you know, any of that stuff.”

    Christopher P. Conniff, a lawyer for Adam Skelos, said his client is not guilty of the charges.

    In return for the payments, Sen. Skelos allegedly worked in several ways to benefit Glenwood and the wastewater treatment company, AbTech Industries, including helping to secure real estate tax breaks, facilitating a $12 million county government contract for AbTech, helping AbTech lobby unsuccessfully to legalize hydraulic fracturing in the state and pushing for changes in the 2015-2016 budget that would have increased funding for stormwater infrastructure.

    Neither Glenwood nor AbTech was named in the complaint, and neither has been charged. In a statement, AbTech said it is cooperating with investigators. Alan Levine, Glenwood’s lawyer, declined to comment.

    The charges come less than four months after another New York power broker, then-House Speaker Sheldon Silver was arrested on corruption charges. That arrest actually led the Skeloses to become more careful in their dealings, according to the complaint. In February, Adam Skelos began using a second “burner” cellphone and asked his father to speak to him using FaceTime, the iPhone app, in an effort to evade detection. The following month, he was caught on a wiretap telling his father that “you can’t talk normally because it’s like…Preet Bharara is listening to every…phone call.”

    Bharara, the U.S. attorney behind both the Skelos and Silver cases, was indeed listening. “Public corruption is a deep-seated problem in New York,” Bharara said at a news conference Monday announcing the charges against Skelos. “And we are deadly serious about tackling that problem.”

    Last month, New York state lawmakers passed a package of ethics reforms that will require them to disclose more about the sources of their private income, further restrict the use of campaign funds and increase disclosure of independent political spending. But reform advocates said the measures fell far short of what’s needed and failed to address several key sources of the state’s corruption challenges.

    Chief among those is an odd quirk of New York’s campaign finance law that allows virtually unlimited contributions, a central part of the web of relationships involving Glenwood and Skelos. Glenwood Management, and its founder Leonard Litwin, was apparently a key player in Silver’s case as well, and Litwin and the firm have used a network of limited liability corporations to give more than $10 million to state candidates in New York since 2005, more than anyone else in that time period, according to the Silver complaint.

    Under New York state law, limited liability corporations, or LLCs – which as their name implies limit the personal liability of their owners and provide tax benefits – are subject to the same rules as individuals: they can give as much as $150,000 total to candidates and political committees in a calendar year. However, while an individual can only give once, the law doesn’t prevent someone from establishing multiple limited liability corporations, which can then each give as much as $150,000.

    The Skelos complaint, for example, details five $20,000 donations made on the same day by LLCs connected to Litwin to the Erie County Republican Committee.

    The complaint doesn’t indicate that the contributions were illegal and Bharara declined to say whether he is investigating them.

    Litwin is part of a growing wave of political donors who have turned to LLCs for political giving as a means of maintaining anonymity and evading limits on individual donors. Since 2010, donors have given more than $33 million to federal super PACs through LLCs. While federal rules require super PACs to disclose the names of their political donors, they are not required to identify who is behind money they receive from LLCs. 

    These types of corporations are also the preferred vehicle for donations from the emerging political kingmaker Manoj Bhargava, the founder and CEO of 5-hour Energy, who has given more than $5 million to state candidates and political committees since 2009, primarily through a handful of the more than 70 LLCs to which he is connected.

    Another recurring theme in New York has been the abuse by lawmakers of community-based nonprofits to embezzle funds, an issue highlighted by the Center for Public Integrity in a 2013 report.

    Over the past two years, at least 13 sitting or former New York lawmakers have been arrested, convicted, sanctioned or resigned as a result of ethics transgressions. The state ranked 37th, earning an overall D grade, in the State Integrity Investigation, a 2012 analysis and ranking of state government accountability and transparency conducted by the Center, Global Integrity and Public Radio International.

    New York Senate Majority Leader Dean Skelos, second from right, speaks alongside his son Adam, second from left, after leaving federal court on May 4, 2015, after arraignment on charges including extortion and soliciting bribes amid a federal investigation into the awarding of a $12 million contract. Nicholas Kusnetzhttp://www.publicintegrity.org/authors/nicholas-kusnetzBen Wiederhttp://www.publicintegrity.org/authors/ben-wiederhttp://www.publicintegrity.org/2015/05/05/17306/arrest-senate-president-latest-new-york-indignity

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    No space rock is so political as the moon.

    President John F. Kennedy vowed to land a man there and return him safely to Earth.

    President Richard Nixon presided over humanity's first successful moon landing, all while prepping for the worst.

    More recently, Newt Gingrich — to innumerable snickerspromised that, as president, he'd colonize the moon.

    It's fitting, therefore, that the 2016 election will feature a decidedly lunar super PAC.

    Dubbed the "America is Super PAC" and officially registered with federal regulators Sunday, the new committee is led by three members of the Lunar Reconnaissance Orbiter Science Operations Center team at Arizona State University.

    The America is Super PAC is "entirely unrelated" to their work on the orbiter project, said Nick Estes, one of the super PAC's founders.

    But the trio shares "some common interests and political views, and we decided to give this a go as private citizens," he added.

    Those common interests, Estes says, include concerns about corporate interests' expanded role in politics and a desire to increase federal spending on basic research and education.

    The America is Super PAC probably won't itself grow too big, Estes acknowledged.

    Nevertheless, he said, the super PAC plans to "raise what funds we can to inform the public about candidates who share our views" on basic research and education. America is Super PAC has not yet chosen specific candidates to support, he added.

    "We formed the PAC partly as an exercise to see first-hand how the system works, and partly to try to do some good with it," Estes said.

    Simply forming a super PAC guarantees little. Most of the nearly 1,000 such committees registered with the Federal Election Commission have raised little or no cash, with billionaire-buoyed behemoths such as conservative American Crossroads and liberal Senate Majority PAC decided outliers.

    By law, super PACs may raise and spend unlimited amounts of money to advocate for or against political candidates. They've existed for less than five years, the indirect product of the Supreme Court's 2010 decision in Citizens United v. Federal Election Commission.

    NASA launched the Lunar Reconnaissance Orbiter in 2009. Since then, the probe has gathered massiveamounts of data on Earth's neighbor, about 240,000 miles distant.

     

     

    A plane leaving Philadelphia passes the moon on May 4, 2015.Dave Levinthalhttp://www.publicintegrity.org/authors/dave-levinthalhttp://www.publicintegrity.org/2015/05/05/17304/new-super-pac-takes-moon-shot

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