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Attorney General Bondi gives Broward Health deep discount in fraud settlement

By Dan Christensen, FloridaBulldog.org 

Florida Attorney General Pam Bondi

Eighteen months ago, the office of Florida Attorney General Pam Bondi demanded Broward Health pay more than $5.3 million to settle state Medicaid fraud claims uncovered during a federal whistleblower probe that cost Broward Health $69.5 million.

On Monday, Broward Health’s commissioners gleefully approved paying instead $1.5 million to settle with the state.

“Obviously we would have preferred zero, but we need to get this behind us and have it over done,” said Commissioner Linda M. Robison, the board’s secretary/treasurer.

Commission Chairman Rocky Rodriguez called the settlement payout “a drop in the bucket.”

No explanation was given to explain the deep discount that Broward Health got.

Florida Bulldog reported the state’s claim on Broward Health in March 2106 after Bondi’s office released a copy of the state’s demand letter in response to a public-records request.

The precise amount originally sought was $5,325,671, which Assistant Attorney General Jill Bennett informed Broward Health’s lawyers “represents damages recoverable under the Florida False Claims Act.

“This settlement demand amount is based upon (the) North Broward Hospital District having entered into financial relationships with physicians that violated the Physician Self-Referral Law, the Florida Anti-Kickback Statute, Florida statutes and the Florida False Claims Act,” Bennett’s letter said.

The North Broward Hospital District is Broward Health’s legal name.

Scheming to defraud

The letter accused Broward Health of scheming to defraud Medicaid with nine of its doctors who had been given improper and illegal contracts. The various contracts were in force for between six and 14 years. The doctors named in the letter were George Caldwell, Michael Chizner, Violeta McCormack, Hector Rodriguez-Cortes, Rudolph Roskos, John Rozanski, Ashok Sharma, Erol Yoldas and Shazia Zafar.

Coincidentally, commissioners on Monday renewed for two years Broward Health’s employment agreement with Dr. Rodriguez-Cortes. Rodriguez-Cortes is the Medical Director for pediatric hematology oncology services at the Salah Foundation Children’s Hospital at Broward Health Medical Center in Fort Lauderdale.

The state’s allegations mirrored the federal Medicare/Medicaid fraud case against Broward Health.

Broward Health General Counsel Lynn Barrett announced the settlement at Broward Health’s regular board meeting. “We thought this is a very, very good settlement,” she told commissioners while recommending they approve the deal.

Negotiations that led the state to significantly discount its own claim also put an end to concern that the state might go through with its threat to sue in Leon County Court and seek treble damages and civil penalties of not more than $11,000 for each false claim that Broward Health submitted.

Florida and the federal government share the cost of the state’s Medicaid program, which provides medical coverage to low-income individuals and families.

Corruption allegations involving Broward Health, Gov. Scott unsealed in whistleblower suit

By Dan Christensen, FloridaBulldog.org 

Gov. Rick Scott, left, and Fort Lauderdale lawyer David Di Pietro

New and politically explosive corruption allegations surrounding Broward Health’s no-bid, 25-year contract with 21st Century Oncology – a company financially tied to Gov. Rick Scott – are spilling out publicly with the unsealing of a federal lawsuit in Fort Lauderdale.

Florida Bulldog exclusively reported last year about 21st Century’s unprecedented 2012 contract to provide radiation oncology services at Broward Health, and how it was inked while the governor was an investor in a private-equity firm that owned 21st Century Oncology.

The 53-page whistleblower lawsuit brought by former Broward Health board chairman David Di Pietro against Fort Myers-based 21st Century and 100 “John Does” claims to provide the inside story behind the deal.

“The existence of the 21st Century contract was recently revealed in the media to the public. What hasn’t been revealed is why and how 21st Century received this extraordinary contract from Broward Health,” the lawsuit says. “The answer is kickbacks.”

Along the way, the complaint alleges, Broward Health’s former chief executive officer, Frank Nask, paid hundreds of thousands of taxpayer dollars in “hush money” to grease the deal. To get Nask on board with 21st Century’s plans, Fort Lauderdale lobbyist William “Billly” Rubin, one of the governor’s closest friends, allegedly offered Nask kickbacks of financial security and the governor’s political protection, while applying political pressure in the governor’s name where necessary.

Lobbyist William “Billy” Rubin

Specifically, “Rubin promised Nask that [the governor’s] appointments to the Broward Health Board would protect Nask’s continuing employment salary and pension as CEO,” the suit says. “Rubin also communicated the message to Nask that if he did not support the contract with 21st Century, then the appointments to the board would not be his allies and his employment would be terminated.”

Nask’s annual salary at the time was about $680,000, plus performance bonuses and benefits. At the time, it had been publicly reported that the federal government was investigating the district’s contracts with 27 of its physicians – a probe that led to a $69.5 million settlement in 2015 – and Nask “needed allies … Nask agreed to Rubin’s demands,” the complaint says.

21st Century executives ‘fully aware’

“Executives at 21st Century were fully aware and complicit in this kickback scheme,” the complaint says.

Neither Rubin nor Nask could be reached for comment. A spokeswoman for 21st Century said the company does not comment on pending litigation.

Gov. Scott’s Office released this statement: “(Neither) the Governor’s office nor the Governor are named as a party in this lawsuit, which was filed against a private company four days after Mr. Di Pietro resigned from the board in April 2016.  Governor Scott has acted to make sure that the North Broward Hospital District is accountable to the taxpayers they serve and will continue to do just that.”

Di Pietro declined to comment. His lawsuit seeks to recover tens of millions of dollars it says were wrongfully billed to Medicare, Medicaid and other federal health-care programs. If successful, whistleblowers like Di Pietro can collect huge rewards.

21st Century operates approximately 145 cancer treatment centers in 17 states. According to the lawsuit, 21st Century “orchestrated” the scheme “to control referrals of cancer patients for radiation oncology services,” targeting Broward Health because it is a major regional treatment center for cancer patients. “Thousands of patients insured by Medicare and other federal healthcare programs” provide “a lucrative revenue stream for 21st Century.”

The entrance to 21 Century Oncology’s headquarters in Fort Myers

21st Century has been a reliable contributor to Gov. Scott’s election campaigns. For example, state records show that between May 2012 and January 2014 – the year Scott faced a tough re-election challenge from former Gov. Charlie Crist – 21st Century gave more than $360,000 to Scott’s Let’s Get to work political committee. After Scott was re-elected, the company gave an additional $30,000.

Broward Health, whose legal name is the North Broward Hospital District, has 8,000 employees and operates more than 30 healthcare facilities including Broward Health Medical Center, Broward Health North, Broward Health Imperial Point and Broward Health Coral Springs. It is an independent special district run by an all-Republican board of commissioners appointed by the governor. The district is obliged to treat indigent patients and levies ad valorem taxes of about $170 million a year on property owners in North Broward.

Gov. Scott allegedly involved himself directly in the matter about March 2012 with a phone call to Di Pietro, whom he’d appointed to Broward Health’s board on Rubin’s recommendation in September 2011. Scott’s call came around the time “a colleague of Di Pietro’s” called then-Lt. Gov. Jennifer Carroll “to advise her that Rubin was using undue influence and political patronage to appoint commissioners to the Broward Health Board in order to get his clients’ contracts approved.”

Broward Health CEO Frank Nask Photo: Karla Bowsher

Scott phoned on a day he was interviewing two potential board members. “Di Pietro told Governor Scott that Nask and Rubin were hand-picking ‘candidates’… and that the two interviews he had that day were not independent candidates; rather they would be doing the bidding of Nask and Rubin. Governor Scott acted upset but he ignored Di Pietro’s concerns. Governor Scott continued to follow Rubin’s lead in appointments to the board,” the suit says.

Days later over lunch, March 27, 2012, Rubin “expressed frustration” at Di Pietro, telling the governor about “my appointments” to Broward Health’s board, the complaint says.

Pressure on El Sanadi

Among those who felt pressure from Rubin was Dr. Nabil El Sanadi, who succeeded Nask in December 2014. El Sanadi commited suicide on Jan. 23, 2016.

Shortly after El Sanadi was hired, Rubin set a Jan. 19, 2015 meeting with El Sanadi, lobbyist Jim Eaton, 21st Century boss Dr. Daniel Dosoretz and Di Pietro. The complaint says that at the gathering, Dosoretz is said to have “bragged” about his “close friendship with Governor Scott” and urged El Sanadi “to give more business to 21st Century.” Specifically, Dosoretz allegedly asked El Sanadi to arrange for Broward Health to circumvent eligibility rules of a government drug discount program for hospitals and buy the chemotherapy drugs used by his company to “save 21st Century monies on those drugs.”

Dr. Nabil El Sanadi, Broward Health’s late chief executive

Di Pietro, who operates his own Fort Lauderdale law firm, contends that Rubin continued to meet with El Sanadi “on a weekly basis” until El Sanadi’s abrupt death.

The complaint blames the corrupt 21st Century deal for leading to losses of more than $30 million for taxpayer-supported Broward Health between September 2011 and its filing in April 2016.  “Over the course of the potential 25-year term of the contract, Broward Health is on track to lose over $125 million.”  Potential billings by 21st Century during the 25-year term “will exceed $800 million,” the suit says.

Di Pietro and his attorneys filed the case under seal in April 2016 under the False Claims Act and Qui Tam statute, part of a Latin phrase that means “he who sues in this matter for the king as well as for himself.” The case was ordered unsealed Friday by Fort Lauderdale U.S. District Judge Kathleen M. Williams after the government declined to intervene. No explanation was given for that decision, though it could involve 21st Century’s July filing in bankruptcy court that seeks to reorganize and shed massive debt.

Prosecutors, however, reserved the right to intervene later “for good cause” or seek dismissal. The decision means the case will proceed with Di Pietro’s team of attorneys prosecuting. Lead counsel is Atlanta’s Bryan Vroon, who in 2015 represented whistleblower Dr. Michael Reilly while extracting $69.5 million from Broward Health to settle allegations of health-care fraud.

The death of Dr. El Sanadi marked the beginning of the end of Di Pietro’s chairmanship.

Six days after El Sanadi’s death, the governor’s chief inspector general, Melinda Miguel, informed Di Pietro that with Scott’s support she would be conducting a review of all of Broward Health’s contracts dating from July 1, 2012.

Timing of state probe of Broward Health ‘no coincidence’

“The cutoff date of contracts to be reviewed by the governor’s chief inspector general is no coincidence. Broward Health originally entered the contract with 21st Century in September 2011,” the complaint says. “There would be a public appearance of an investigation by the governor’s office but the 21st Century contract would escape review.”

Melinda Miguel

On March 18, 2016 Miguel sent a letter to Scott accusing Di Pietro and board member Darryl Wright of interfering with her investigation by hiring outside legal counsel for the board. “Within minutes” Scott suspended Di Pietro and Wright for “acts of malfeasance,” the complaint says.

Days later, Di Pietro asked a Broward judge to reinstate him to the board. On April 11, following a hearing, Circuit Judge Carol Lisa Phillips determined that Miguel’s letter and Scott’s executive order suspending Di Pietro were “devoid of any specific acts of malfeasance” and granted Di Pietro’s petition for reinstatement. Three days later, Di Pietro resigned from the board.

According to the lawsuit, the contract was the result of political intrigue initiated by 21st Century and led by lobbyist Rubin. Specifically, it says Rubin was hired in the summer of 2011 to approach Nask about obtaining a lengthy, exclusive contract.

Di Pietro voted to approve the 21st Century deal in January 2012, apparently not knowing of the governor’s indirect ownership interest in the company or Nask’s hush money payments to HealX Oncology. Months later, after learning of the payout from Broward Health’s then-internal auditor, Maria Panyi, Di Pietro began asking questions.

That summer and fall, Rubin told Di Pietro “not to discuss or investigate the HealX payouts because the issue would ‘hurt’ Nask, 21st Century Oncology and Governor Scott.” Rubin allegedly kept up the pressure on Di Pietro, instructing him to be a “team player” and to support the governor.

To obtain the contract for 21st Century, Nask first had to terminate the existing contract with HealX Oncology. To do so, he arranged for the payment of $830,000 in “hush money” intended to “buy silence” of HealX and Dr. Anurag Agarwal, the complaint says.

The complaint says Broward Health cut three checks to HealX without the board’s approval. Two checks were for $250,000, the limit on payments Nask had authority to authorize alone. The third check for $330,000 was justified as “director fees” for three years, and the district paid “without any supporting documentation.”

Nask ‘obscured’ major losses

The lawsuit says Nask didn’t tell the board about the kickbacks that induced the deal or his hush money payments, while leading board members to believe that HealX had quit. Likewise, Nask “obscured” financial information about the deal from the board, including “major losses” from the deal and the fact that the contract let 21st Century “bill, collect and keep all global revenues associated with outpatient radiation oncology services” – a “major change in the billing arrangement” for the district’s oncology services.

Nask also did not obtain a fair market valuation regarding “the economics of the deal with 21st Century.” Di Pietro didn’t learn the truth until years later, the complaint says.

In the summer of 2014, Nask “saw an opportunity to escape the kickback control of 21st Century” by supporting Charlie Crist over Scott in the gubernatorial race, the complaint says. Nask wanted to leak information then about the ongoing federal probe or to settle prior to the election to hurt Scott. But Rubin learned of Nask’s plan and told Di Pietro to “squash Nask like a bug” and “have him fired.”

Nask was gone by the end of the year, and Di Pietro recommended Dr. El Sanadi as his replacement. After apparently being reassured that El Sanadi would back 21st Century, Rubin pushed the governor to appoint to the board Maureen Canada and Sheela Van Hoose, two El Sanadi supporters. After El Sanadi’s appointment, “Rubin communicated to El Sanadi that he was indebted to Rubin,” the complaint says.

Rubin apparently forgave Nask for his political transgression. The complaint says Rubin lobbied Di Pietro to give Nask a ‘generous’ severance package. “Broward Health paid Nask a full-year of compensation after his retirement,” the complaint says.

In late 2014 and early 2015, Di Pietro “discussed with El Sanadi the unfortunate reality of political control at Broward Health” and that he would “face the challenge of working closely with Rubin” and his addressing his demands to protect and favor 21st Century.

“The message to El Sanadi was clear,” according to the lawsuit.

In addition to counts alleging false claims, the lawsuit also accuses 21st Century of making false statements to obtain payments, conspiring to submit false claims, causing claims to be falsely certified, knowingly retaining overpayments and making false records to avoid having to make refunds.

The complaint’s bottom line: “Without any bids or independent fair market valuations, a private company gained control of a major public hospital system’s referral stream of cancer patients, the entire radiation oncology infrastructure of general space, vault space and radiation equipment and ‘global revenues’ from treating such patients.”

FBI probe of tie between Saudi ambassador, al Qaeda leader put on ice

By Dan Christensen, FloridaBulldog.org 

Saudi Prince Bandar bin Sultan, right, and Guantanamo detainee Abu Zubaydah

For 14 years, the FBI kept secret that a top al Qaeda leader captured in Pakistan in 2002 possessed the unlisted phone number of an offshore company tied to Saudi Arabia’s U.S. ambassador, Prince Bandar bin Sultan.

The news got out last year after President Obama ordered the release of the “28 pages,” a long-suppressed chapter of a 2003 congressional report on 9/11. Also disclosed: FBI agents in Denver were assigned to investigate the company, ASPCOL Corporation, which the FBI described as “the umbrella corporation that manages the Colorado residence of Prince Bandar.”

But agents assigned to investigate ASPCOL, whose unlisted number was found in the phone book of “high-value” Guantanamo detainee Abu Zubaydah, quickly suspended the probe.

“The Denver office did not attempt to make any local inquiries about ASPCOL, as they believed that any inquiries regarding ASPCOL would be quickly known by Prince Bandar’s employees,” the 28 pages said. “Due to the sensitivity of this matter, they decided to hold the investigation of ASPCOL in abeyance until they received additional guidance from FBI headquarters.”

The guidance Washington gave its Denver agents is not known, and FBI spokesmen won’t discuss it. It now appears, however, that the FBI never restarted its suspended investigation. Two witnesses told Florida Bulldog the FBI never contacted them to inquire about ASPCOL.

Witnesses not interviewed

One witness owned a company identified in the 28 pages of Congress’s Joint Inquiry into 9/11 as having provided security at Bandar’s magnificent 15- bedroom, 16 bath residence in Aspen known as the Hala Ranch. The other is a well-known Washington attorney who helped incorporate ASPCOL and served on its board of directors.

Prince Bandar’s Hala Ranch in Aspen, Colorado

The FBI’s Denver office identified the company as Scimitar Security, but provided no other details about it. Colorado corporate records identify Scimitar’s president as Hans Marschler. In an interview, Marschler, who now resides near Houston, confirmed that he owned the now-closed Scimitar Security and that the company had worked at Hala Ranch.

“It was a very small operation, one person during the day and one at night. We spent time watching the house. People came to work, we kept an eye on them,” Marschler said. “The FBI never contacted me.”

Marschler added that when Bandar was present he was accompanied by additional heavy security. “They brought in their whole teams,” he said. “Whoever was head of security, I don’t know.

Another Scimitar Security, this one a still active company based in San Diego, CA., has a connection to allegations of terrorism, but owner Abdul Halim Mostafa said his firm never worked for ASPCOL, Bandar or anywhere outside California.

Mostafa’s son is Jehad Serwan Mostafa, who is wanted by the FBI “for his alleged terrorist activities and acting as an operating member of al-Shabaab, a Somalia-based terrorist organization” with ties to al Qaeda. An indictment charging Mostafa, a U.S. citizen who was licensed as a security guard from 2000 to 2006, with conspiracy to provide material support to terrorists and providing material support to a foreign terrorist organization was unsealed in 2010. The U.S. has a $5 million bounty on Mostafa’s head.

The Duttons of Arabia

The second person with information about ASPCOL the FBI never contacted is Washington attorney Nancy Dutton. Dutton represented the Saudi embassy for several decades until last year. Similarly, she represented the Saudi foreign ministry from 1975 until about two years ago.

Dutton and her late husband Fred Dutton, an attorney and key strategist to many big-name Democrats in the 1960s and 1970s who later became a counselor to Prince Bandar and a lobbyist for Saudi Arabia, incorporated ASPCOL in Curacao, Netherlands Antilles in December 1988 and later served on its board of directors.

Photo: CSPAN

“No, the FBI never called me and I doubt whether they called Fred or I would have known it,” said Dutton, a White House aide under President Kennedy. She declined further comment.

Another person involved with ASPCOL is Aspen attorney William “Willy” Jordan III, who would not be interviewed. Jordan represented Bandar’s interests in the area and served as APSCOL’s managing director for many years before it was liquidated and closed in January 2014.

The island of Curacao is a financial center in the Caribbean known for strict bank secrecy that has facilitated drug related crime. The U.S. currently lists the tiny country that’s part of the Kingdom of the Netherlands as a “jurisdiction of primary concern” where “money laundering occurs through real estate purchases and international tax shelters.”

Records show that a month after ASPCOL N.V. was incorporated it paid $3.5 million for 90 acres in Aspen. The mansion was constructed in 1991. Pitkin County property records show that ASPCOL sold the property for $49 million in May 2012.

Bandar, 68, was Saudi Arabia’s ambassador to the U.S. from 1983 to 2005.

He was close to President George W. Bush, earning him the nickname Bandar-Bush. A White House photo taken two days after 9/11 shows Bandar on the White House’s Truman Balcony with Bush, Vice President Dick Cheney and National Security Advisor Condoleeza Rice.

Bandar interview secret

The 9/11 Commission interviewed Bandar on Oct. 7, 2003. The government continues to keep secret the interview citing national security.

Zacarias Moussaoui

In October 2014, imprisoned 9/11 conspirator Zacarias Moussaoui gave a deposition to attorneys representing victims of the September 11, 2001 terror attacks on New York and Washington. He talked about how his superiors in al Qaeda had tasked him with creating a digital database of the group’s donors. “Shaykh Osama wanted to keep a record [of] who give money…to the jihad,” Moussaoui said, according to a transcript.

He went on to name numerous contributors he said were on the list. They included Bandar and other members of the Saudi royal family such as Prince Turki al-Faisal, Prince al-Waleed bin Talal and Prince Mohammed al Faisal.

Questions have long been raised about Bandar’s possible ties to 9/11. More than a decade ago it was reported that his wife, Princess Haifa, had for some time sent a monthly check of $2,000 to the wife of Osama Bassnan, a suspected Saudi agent and alleged al Qaeda sympathizer who FBI records identify as a “close associate” of Omar al-Bayoumi, another apparent Saudi agent who provided financial and other support to two 9/11 hijackers in San Diego in 2000.

The 28 pages included new information about that matter, saying that FBI agents who searched Bassnan’s home found copies of 31 cashier’s checks payable to Bassnan’s wife totaling $74,000 that were “drawn on the Riggs Bank account of Prince Bandar’s wife.” The checks, from February 1999 to May 30, 2002, were supposed to be for nursing services, but “there is no evidence that Bassnan’s wife provided nursing services.”

The pages also said that Prince Bandar himself sent checks directly to Bassnan and his wife. Those checks, cashed in 1998, were for $15,000 and $10,000. FBI Executive Assistant Director Pasquale D’Amuro told Congress on Oct. 9, 2002, “What the money was for is what we don’t know.”

Florida Zika emergency funds went to partner of Ann Scott’s aerial spray businesses

By Dan Christensen, FloridaBulldog.org 

Gov. Rick Scott and First Lady Ann Scott

Gov. Rick Scott has used his emergency authority to spend $33.3 million to combat Zika, some of which went to pay for aerial spraying done by a company that is partnered with his wife’s mosquito spraying businesses in another state.

Florida Bulldog reported in August 2016 that Scott, via First Lady Ann Scott, had an undisclosed financial interest in Mosquito Control Services (MCS) of Metairie, LA. The company describes itself on its website as a “fully-certified team of mosquito control experts – licensed throughout the Gulf Coast, including Louisiana, Georgia, Mississippi, Alabama and Florida.”

Further examination of Louisiana corporate records, however, shows the Scotts are also tied to eight other active mosquito control firms all at the same Metairie address. Several have lucrative, multi-year contracts to provide aerial spraying and other services to local parishes and cities.

The nine are not on Florida’s list of state vendors. Records show, however, that at least four of them, including MCS, conduct aerial spray operations in Louisiana using planes owned by one of Florida’s largest Zika-fighting subcontractors, Dynamic Aviation Group of Bridgewater, VA.

Dynamic Aviation contracts with the Scotts’ companies to handle their aerial bug spraying because those companies have no planes of their own, according to Federal Aviation Administration records.

Dynamic is partnered in Florida with Illinois-based Clarke Environmental Mosquito Management, the principal vendor to more than a dozen Florida counties, cities and independent mosquito control districts, including Miami-Dade. FAA records list Dynamic or its affiliates as the registered owners of dozens of aircraft, including a fleet of turbine-powered Beechcraft King Air spray planes.

A Dynamic Aviation spray plane

“The Clarke and Dynamic Aviation Partnership is the leading provider of mosquito control application services to federal, state and local governments throughout the United States,” Clarke boasted in a bid document submitted to Ocala in August 2015.

Today, the Florida Department of Health reports that there are “no areas of ongoing, active transmission of Zika by mosquitos in Florida.” In February 2016, however, public anxiety in the state about Zika was on the rise.

Public health emergency

That month, Gov. Scott declared a Zika public health emergency in 23 counties and directed Florida’s surgeon general to decide how long the emergency declaration should last. It has continued this year in a hodge-podge of counties across the state, including Miami-Dade. Late last month, Surgeon General Dr. Celeste Philip re-declared a Zika public health emergency in Broward and Palm Beach counties citing travel-related cases. Emergency spending also carried over into 2017 in Miami-Dade and Broward.

 Gov. Scott led last year’s high-profile anti-Zika campaign. He also politicized it. From August through early November, during the height of the presidential campaign, Republican Scott’s office issued a dozen press releases attacking Washington, specifically the Obama administration and Florida Democratic Sen. Bill Nelson – who many believe Scott will run against next year – about the lack of immediate Zika funding.

Florida Surgeon General Dr. Celeste Philip

On Sept. 22, Gov. Scott wrote an op-ed article for USA Today in which he denounced Obama, called the “entire” federal government” incompetent and alleged that federal inaction against Zika was “sad, sick proof that Washington isn’t just broken, it must be completely overhauled from top to bottom.”

Scott’s article doesn’t mention how under Scott state money for mosquito control programs was cut 40 percent – from $2.16 million to $1.29 million – in 2011. Politico had reported that in a story published one month earlier. Likewise, Scott didn’t mention that he’d cut a special $500,000 appropriation for a public health “mosquito lab” in Panama City Beach, effectively shutting it down and “causing the state to lose half of its mosquito researchers,” according to Politico.

In response to an inquiry by Florida Bulldog, Florida Department of Health spokeswoman Mara Gambineri said the state has to date expended $52.8 million in Zika emergency funds, including nearly $9 million this year. Of that, Scott’s emergency order caused $33.3 million to be sent to 69 counties and mosquito control districts “to increase their capabilities and to prevent and respond to Zika,” she said.

State records also show the Department of Health paid Clarke $783,572 directly to supply mosquito traps and monitoring services in 2016-2017.

How much emergency money went to pay for aerial spraying is not known. “Decisions on the mechanism for vector control, whether it be aerial, truck, etc. were made by the mosquito control districts. We do not track the funding specifically each method,” Gambineri said.

Tracking spending on the county level is problematic.

For example, Miami-Dade spokeswoman Gayle Love said the county has paid Clarke/Dynamic $175,000 for aerial spraying since the governor’s February 2016 emergency order. Yet in May the county commission ratified its acceptance of $1.2 million in state emergency funds to pay for last year’s aerial spraying services. The balance was diverted into another pot of $22 million in emergency funds that paid for truck spraying, Love said.

‘Aviation solutions’

Privately owned Dynamic provides what it calls “special-mission aviation solutions” to customers that include “national defense, military intelligence, federal agencies, state and local governments, nonprofit research organizations and private companies.”

Records show the Scott’s nine mosquito control companies – all Louisiana limited liability companies with names like Mosquito Control Services, Mosquito Control, Terrebonne Mosquito Control and St. John Mosquito Control – are led by two officer-managers, Gregory Scott and Steven Pavlovich. The companies make most of their money exterminating mosquitos for local governments in Louisiana.

Gregory Scott, CEO of G. Scott Capital Partners

Gregory Scott is also the managing director of G. Scott Capital Partners, the Connecticut private-equity firm in which Ann Scott is a substantial investor-owner. Its investment program “aims to generate high financial returns by making direct control investments in established, U.S.-headquartered lower middle market companies,” according to paperwork filed with the Securities and Exchange Commission.

Also known as Scott Capital, the firm boasts on its website of its ownership of MCS as well as investments in other companies owned or formerly owned by Gov. Scott, including Continental Structural Plastics. Florida Bulldog reported in June that Gov. Scott apparently pocketed $200 million earlier this year after the $825 million sale of CSP to the Japanese conglomerate Teijin Ltd.

Gregory Scott has said he is no relation to Gov. Scott, but SEC records show that from 2000 to 2012 he led the private-equity group at the governor’s Richard L. Scott Investments. He previously told Florida Bulldog that Ann Scott is a “passive investor” in Scott Capital.

The governor and other Florida state officers are not required by law to disclose assets held in the name of their spouses or other close relatives.

Gov. Scott, a multimillionaire, maintains his personal investments in a state “qualified blind trust” that’s ostensibly independent, but is in fact overseen by another of the governor’s former business cronies, Alan Bazaar of New York’s Hollow Brook Wealth Management. Bazaar also serves as an advisory board member of Scott Capital, according to SEC records filed last year.

The governor’s office regularly cites the blind trust in declining to answer questions or comment on the known business dealings of Gov. Scott and the First Lady.

“After Governor Scott took office in 2011, he put all his assets in a blind trust so they would be under the control of an independent financial professional. As such, the governor has no knowledge of anything that is bought, sold or changed in the trust,” the office said on Friday.

Dynamic Aviation was likewise silent in response to written questions.

“Dynamic Aviation declines to comment on the questions below,” said company spokeswoman Avis Foster in an email last week.

MCS manager Steven Pavlovich did not return phone messages seeking comment.

A lucrative business

The business of spraying mosquitos from the air can be lucrative. For example, MCS has a five-year mosquito abatement contract with Louisiana’s Jefferson Parrish that’s worth $4.3 million a year – or $21.5 million in total. The latest contract runs until Jan. 31, 2023.

A screenshot from MCS’s home page showing what it says is its “fleet” of mosquito spray planes

A bid document submitted by Scotts’ company in January shows how it cultivated goodwill with local politicians. An affidavit by company manager Pavlovich says MCS contributed $25,000 to the campaigns of 15 Jefferson Parish elected officials in 2015-2016.

Bid documents also disclosed that MCS passes its aerial spraying work in the parish to Dynamic Aviation, the same subcontractor that sprays in Florida.

MCS’s home page features a photo of what its literature calls “our fleet of Beechcraft King Air” spray planes. In fact, the photo is at least six years old, and FAA records show that the planes it depicts were owned or formerly owned by Dynamic Avlease, a member of the Dynamic Aviation Group.

Some agencies in Florida’s decentralized mosquito control scheme, like Broward County, own their own planes or helicopters and do their own aerial spraying. The Clarke/Dynamic partnership has mosquito control contracts with Miami-Dade, Orange, Osceola, Seminole, Martin, Henry, Volusia and Alachua counties, among others.

In its bid for a multi-year contract with the city of Ocala in 2015, Dynamic identified five planes that it said were “registered here in the State of Florida to perform mosquito control services.”

Online flight records indicate that the Scotts’ Terrebonne Mosquito Control, in addition to using the same aerial spraying subcontractor, may also have used that Florida-registered mosquito control plane.

In July one of those planes, tail number N72J, flew back and forth four times between Sarasota/Bradenton International Airport and Houma-Terrebonne Airport in Houma, LA, the records say.

Broward chief judge leads push to release from jail nonviolent poor who can’t make bail

By Dan Christensen, FloridaBulldog.org 

Broward Chief Judge Jack Tuter Photo: J.A.A.B Blog

Concerned that poor people charged with minor, nonviolent offenses who can’t post bond are clogging the jail at taxpayers’ expense, Broward Chief Judge Jack Tuter is spearheading a push to release more of them before trial.

“If you are in jail more than a couple of days on a low bond, you are probably there because you can’t afford to post the bond. People shouldn’t be waiting in jail simply because they are poor,” Tuter said in an interview last week. “It’s a multi-faceted problem, but my goal is to get out those with ties to the community and some degree of assurance they’ll show up in court.”

Tuter, who took over as chief judge on July 1, said recent Broward jail statistics showed that 321 people were being held on bonds of under $5,000. Low-risk individuals in that group with no other pending charges are the focus of Tuter’s concern.

Broward’s County Court judges serve on a rotating basis as first appearance, or Bond Court judges. Earlier this month, Tuter and representatives from the Broward Sheriff’s pretrial diversion program met with those judges for a refresher about the options for judges when dealing with incoming defendants, including less costly electronic monitoring and releasing defendants on their own recognizance.

“Most judges knew this, but I reemphasized it,” said Tuter. “Is there an alternative to jail?”

The chief judge’s action was warmly met by Broward Public Defender Howard Finkelstein, who has long accused local judges of fostering a “double standard” of justice by ignoring the disparate treatment of minorities and the indigent.

“Broward County is taking its first steps to end the institutionalized racist justice system that has existed in our county for the past 50 years,” Finkelstein said. “We have a chief judge who’s trying to figure out the right thing.”

Broward’s jails have a troubled history that led to decades of federal monitoring to protect the constitutional rights of inmates. In 1976, inmates sued alleging a variety of constitutional violations stemming from overcrowding, abuse and inadequate medical care. The case was largely settled last December – 40 years later.

Chronic overcrowding is not currently a problem, with the inmate population under 4,000 and about 77 percent of the system’s 5,144 bed capacity.

More reductions sought

Still, Tuter wants to see that number lower. “I’d like to see it under 70 percent,” he said.

The cost to house an inmate in Broward is about $150 a day. The cost to taxpayers to keep 30 inmates who can’t meet a small bond in jail for 30 days is about $135,000. In contrast, Tuter said it costs $5 a day to put an ankle monitor on a defendant.

The question of who should be released is complicated by several factors, not the least of which is how to deal with defendants who don’t have a permanent address. An address is required for pretrial release. It allows the court system to notify defendants when they must appear in court so judges don’t have to order deputies to go out and pick them up.

When low-bond defendants remain in custody for more than five days or a week judges typically take a “second look” to see if a reason exists to let them out. But if the courts are not successful in further reducing the jail population, Tuter will consider instituting a “third look docket” that will have judges go to the jail to make “a more refined approach” to finding pretrial release.

The court has a lengthy schedule of “convenience bonds” that offer defendants preset amounts they can post to get out of jail, depending on the charge, without even seeing a judge. The bond range is from $25 to $500,000.

Public Defender Finkelstein wants to end the use of convenience bonds, which he says are convenient to judges and the well-to-do, but not his typically indigent clients. Tuter, who was appointed to Broward’s circuit court bench by Gov. Jeb Bush in 2005, has no plans to scrap the schedule.

Still, change that promises to address old grievances has begun.

“Broward seems to be coming out of its constitutional slumber,” said Finkelstein. “It’s like the lights went on and everybody realizes we haven’t been doing things right.”

Saudi Arabia cites FBI’s Meese Commission in asking judge to toss 9/11 victims’ lawsuit

By Dan Christensen, FloridaBulldog.org 

New York City’s annual 9/11 memorial tribute to the fallen.

Forced back into court by an act of Congress and faced with tens of billions of dollars in potential civil liability, oil-rich Saudi Arabia is asking a U.S. judge again to throw out a lawsuit brought against it by thousands of 9/11 victims.

Lawyers for the kingdom moved last week to dismiss the massive case pending in federal court in New York City, citing “baseless accusations that Saudi Arabia conspired to commit a horrific crime against its longstanding ally the United States by knowingly funding the terrorist attacks of September 11, 2001.”

The plaintiffs are survivors of the attacks, family members of the dead, businesses and insurance companies.

Saudi Arabia’s filing responded to their 100-page amended complaint brought in March against the kingdom and its official charity, the Saudi High Commission for Relief of Bosnia and Herzegovina. The complaint followed Congress’s passage last year – over a veto by President Obama – of the Justice Against Sponsors of Terrorism Act (JASTA), which allows Americans to sue foreign states for acts of terrorism that occur on U.S. soil.

Earlier, a federal judge and a U.S. appeals court had dismissed Saudi Arabia and the Saudi High Commission from the case after determining they were protected by the Foreign Sovereign Immunities Act. JASTA removed that protection.

The new court filings show the Saudis are relying heavily on the findings of the FBI’s secretive 9/11 Review Commission to discredit the plaintiffs’ claims that the kingdom is liable for the deaths, injuries and destruction caused by the September 2001 terrorist attacks. Nearly 3,000 people died in the attacks and thousands more were injured.

The 9/11 Review Commission – also known as the Meese Commission after its most prominent member, Reagan-era Attorney General Ed Meese – was authorized by Congress to conduct an “external review” of the FBI’s post-9/11 performance, and to assess new evidence. As Florida Bulldog has reported, however, the commission held no public hearings, had no subpoena power and was largely spoon-fed information by the FBI. Meese and the two other commissioners were chosen and paid by the FBI.

Meese Commission discredits report

The Meese Commission issued a 127-page report in March 2015, which among other things sought to discredit an April 2002 FBI report that said agents had found “many connections” between Saudis living in Sarasota and individuals involved in the 9/11 plot and requested further action be taken.

The April 2002 report, released to Florida Bulldog by the FBI in 2013 amid ongoing Freedom of Information litigation, corroborated a September 2011 Florida Bulldog story that disclosed the existence of the FBI’s Sarasota investigation and reported the FBI had kept it secret from Congress. The story was co-reported by Irish author Anthony Summers, who obtained the initial information about the Sarasota probe.

FBI Director James Comey, second from right, is flanked by 9/11 Review Commissioners Tim Roemer, right, Ed Meese and Bruce Hoffman, far left, on March 23, 2015. Photo: FBI

The FBI told the Meese Commission the 2002 report “was ‘poorly written’ and wholly unsubstantiated.” The commission’s report, however, offered no explanation of the basis for that conclusion. Likewise, the commission apparently never heard directly from the agent who wrote the report, relying instead on the FBI’s characterization of what he had to say.

“The FBI told the Review Commission that the (report) was apparently based solely on unsubstantiated reports from others and there was no documentation supporting its allegations,” the commission’s report says.

No other FBI records to support or explain the commission’s work were made public.

Florida Bulldog sued the FBI and the Department of Justice in June 2016 for access to all Meese Commission transcripts, reports and the like after the bureau failed to respond to a Freedom of Information Act request. The lawsuit forced the FBI to review 1,858 pages of records and to release parts of 713 pages. The FBI withheld 1,145 pages.

Florida Bulldog and its attorneys believe the FBI has not acknowledged the existence of many additional pages of commission records.

Among the released records was a heavily censored Oct. 5, 2012 FBI report emblazoned with a logo that depicts the World Trade Center’s Twin Towers inside a pentagon against a backdrop of an American flag. The FBI considered the report so sensitive that even its title was classified “in the interest of national defense or foreign policy.”

The 2012 FBI report

Declassified portions, however, show that at that time federal prosecutors and FBI agents in New York were zeroing in on an apparent U.S. support network for Nawaf al-Hazmi and Khalid al-Mihdhar, two of the five 9/11 hijackers who were aboard American Airlines Flight 77 when it crashed into the Pentagon. Among other things, the report discusses how in June 2012 a team of New York investigators traveled to London “to exploit evidence seized in 2001 in New Scotland Yard’s searches of Omar al Bayoumi’s residences and offices.”

At the time of its release in December, Sean Carter, a Philadelphia attorney for the plaintiffs, called the 2012 report “a powerful and important disclosure.” Carter appended a copy to the 9/11 victims’ amended complaint when it was filed March 17.

Attorneys Michael K. Kellogg, left, and Sean Carter.

The 91-page Saudi response memorandum filed last week by Washington, D.C. attorney Michael Kellogg attacks the 2012 FBI report as unreliable, noting that the names of its authors are redacted.

The memo says the FBI report “contains hearsay statements” about a pair of Saudis – Omar al-Bayoumi and Fahad al-Thumairy – who are identified as “main subjects” of the probe of  “individuals known to have provided substantial assistance” to Hazmi and Mihdhar in Southern California following their arrival in the U.S. in January 2000.

The FBI report says Bayoumi, a suspected Saudi agent; Thumairy, a Saudi diplomat and imam at the King Fahd Mosque in Los Angeles, and a third person whose name was kept secret on grounds of national security “provided (or directed others to provide) the hijackers with assistance in daily activities, including procuring living quarters, financial assistance, and assistance in obtaining flight lessons and driver’s licenses.” The investigation was seeking to prove the trio knew that Hazmi and Mihdhar “were here to commit an act of terrorism.”

“A statement that an investigator ‘seeks to prove’ a legal conclusion is neither an appropriate allegation nor competent evidence,” the Saudi memo says. “That is especially so here because the investigator’s attempt failed: the 9/11 Review Commission later found as of March 2015 that new evidence available to the FBI was ‘not sufficient’ to support the conclusion that plaintiffs advocate.”

But the commission did not release the 2012 report when it issued its report, nor does its report assess the 2012 disclosures except to note it said al-Thumairy “immediately assigned an individual to take care of al-Hazmi and al-Mihdhar during their time in the Los Angeles area.”

Status of 2012 probe unknown

Likewise, the outcome of the 2012 investigation is not known. No other documents released by the FBI address it.

Said former Florida Sen. Bob Graham, who co-chaired Congress’s Joint Inquiry into 9/11: “If the decision was not to proceed, why? And if it was to proceed, what’s the status?”

From left to right: Dick Cheney, Prince Bandar, Condoleezza Rice, and George W. Bush, on the Truman Balcony of the White House on September 13, 2001. [Source: White House via HistoryCommons.org]

The Saudi memo also attacks as unreliable and insufficient two other documents about 9/11 the plaintiffs rely on, “the 28 pages” and “Document 17.”

The 28 pages refers to a long-suppressed chapter of the Joint Inquiry’s 2002 report about apparent Saudi support for the 9/11 hijackers. The 28 pages were ordered released last summer by President Obama. Among other things, they showed that Saudi Prince Bandar – who on 9/11 was his country’s ambassador to the U.S. – had connections to a major al-Qaeda figure now detained in Guantanamo Bay and others suspected of helping hijackers Hazmi and Mihdhar.

Document 17 is a set of 2002 work plans for staffers of the original 9/11 Commission detailing issues and outstanding questions regarding possible Saudi links to the attacks. It was declassified and released by the National Archives in 2015.

Among other things, Document 17 disclosed that when Guantanamo detainee Ghassan al-Sharbi was arrested in Pakistan in March 2002, FBI agents found a buried cache of documents that included “an envelope from the Saudi embassy in Washington that contained al-Sharbi’s (U.S.) flight certificate.”

Rick Scott, Mike Pence: When campaign fundraising met tax incentives for Scott’s company

By Dan Christensen, FloridaBulldog.org 

Gov. Rick Scott, left, accompanies then Indiana Gov. Mike Pence to a Feb. 5, 2016 fundraiser for Pence at the Fort Lauderdale office of the Tripp Scott law firm. Photo: Conrad & Scherer law firm

Two months after Florida Gov. Rick Scott helped then-Indiana Gov. Mike Pence fundraise in Fort Lauderdale last year, Pence announced a $650,000 incentives package for a company owned in large part by Scott.

Pence’s offer of Indiana taxpayer subsidies for Continental Structural Plastics came as Scott’s Florida contributors poured more than $125,000 into Pence’s gubernatorial re-election campaign. Scott kicked in another $5,000 personal check to fellow Republican Pence’s campaign.

The Tampa Bay Times called Scott’s personal contribution to Pence “unusual” because Scott “has never given more than $500 to a Florida candidate other than himself.” It also noted that Pence had “picked up more campaign cash from Florida than any other state, except Indiana and Washington, D.C.”

Pence’s gubernatorial campaign ended abruptly on July 15, 2016 when Donald Trump tapped him as his vice-presidential running mate. But before that the vice president had been in a tight re-election fight amid sagging approval ratings.

The Feb. 5, 2016 fundraiser for Pence was held at the office of the Tripp Scott law firm. Among those present was prominent Fort Lauderdale lawyer William Scherer, a Scott supporter and frequent donor to Republican candidates. Scherer could not be reached for comment. (Disclosure: Scherer, managing partner of Conrad & Scherer, is a donor to the nonprofit Florida Bulldog.)

Conrad & Scherer’s website includes a brief press release with photos of Pence and Scott at the fundraiser. The site says Scherer and Gov. Scott discussed “creating new jobs for Florida residents.”

Indiana election records show that for the first six months of 2016, until Trump chose Pence, nearly two dozen Scott supporters sent checks to Pence. They include two affiliates of Charters Schools USA; Jupiter investor Lawrence DeGeorge; prison operator The Geo Group, its political action committee, chief executive officer George Zoley and several other company executives; Next Era Energy PAC, run by the owner of Florida Power & Light; the Tripp Scott law firm and five of its attorneys.

Indiana’s incentives deal for CSP

On April 11, 2016, back in Indiana, Gov. Pence disclosed that the Indiana Economic Development Corporation – a group he chaired – had offered Continental Structural Plastics (CSP) $600,000 in conditional tax credits and $50,000 in training grants. CSP was to expand its 323-worker operation in the city of Huntington and add 80 jobs by 2020. CSP makes lightweight composite materials used in cars and airplanes.

“CSP’s growth speaks volumes about this company and its talented Hoosier employees,” Pence said in his announcement. “As CSP grows its operations here in Indiana, Hoosiers can rest assured that this administration will continue to pursue the kinds of policies that make our state a destination for investment and growth.”

But instead of adding jobs, CSP recently notified Indiana workforce officials of a “temporary” mass layoff of 164 workers at its Huntington plant after one of its customers planned to be idle, according to local news accounts. The layoffs are to start July 31.

Pence’s announcement did not mention that his friend, Rick Scott, owned a substantial stake in CSP, or that Florida First Lady Ann Scott had an additional large investment through the Connecticut-based investment firm G. Scott Capital Partners.

Before he became governor, Scott headed Naples-based Richard L. Scott Investments. His firm and CSP management bought the company together. “We acquired CSP in early 2005 with the belief that there was an opportunity to build a great company,” Scott said in a statement published in 2006 in Automotive News.

After he became governor, the mega-wealthy Scott put his assets – including CSP – into a Florida blind trust that put his assets under the control of an allegedly independent trustee and gave him legal immunity from conflicts of interest his diverse investments might pose. The arrangement is problematic, however, because the chief executive of the trustee, Hollow Brook Wealth Management, is longtime Scott crony Alan Bazaar.

As governor, Scott has disclosed his financial interest in CSP on several occasions, most recently in 2014 when he shuttered his first Florida approved blind trust and opened a second one while qualifying for re-election. He valued his shares in the CSP investment partnership then to be worth $43.9 million. The value of the First Lady’s CSP investment, via G. Scott Capital Partners, was not disclosed. In March 2016, CSP said in court papers that most of its stock was privately held by G. Scott Capital.

CSP sold

On Jan. 3 of this year, CSP was sold for $825 million to a subsidiary of Teijin Ltd. Florida Bulldog reported in June that Gov. Scott appears to personally have pocketed $200 million in the deal.

When CSP’s sale was announced, the Japanese conglomerate further identified RLSI-CSP Capital Partners LLC – Rick Scott’s partnership entity – as owning two thirds of CSP’s common stock. The governor owned 37 percent of RLSI-CSP Capital Partners.

Gov. Scott has declined to be interviewed about CSP, and his spokespersons have said that because his investments are in a blind trust he “has no knowledge of anything that is bought, sold or changed in the trust.”

Gov. Rick Scott at May 17, 2016 groundbreaking ceremony for United Technologies’ Center for Intelligent Buildings in Palm Beach Gardens. As part of the deal to bring the project to Florida, Scott approved $4.9 million in tax incentives for Carrier, a United Technologies subsidiary.

Vice President Pence was involved in a similar, but larger incentives package that attracted national attention last November when he and President Trump announced a deal with Carrier to keep its gas furnace plant in Indiana. The company was going to move the plant and about 800 manufacturing jobs to Mexico – a job export plan Trump used during the campaign – but changed its mind after talks with Trump and Indiana’s pledge of $7 million in tax breaks over a decade.

While some Republicans – notably former Alaska Gov. Sarah Palin – label such taxpayer-funded incentives “special interest crony capitalism,” they are the centerpiece of Gov. Scott’s plan to create jobs in Florida.

Interestingly, Scott, like Pence, spearheaded a large cash incentives deal for Carrier. That $4.9 million agreement via the Governor’s Quick Action Closing Fund involved development of United Technologies’ showcase “Center for Intelligent Buildings” in Palm Beach Gardens. The deal with Carrier, a subsidiary of United Technologies, was inked in June 2015, but needed local approvals that didn’t come for months. Gov. Scott attended a groundbreaking ceremony for the project on May 17, 2016.

New York boots Armor Correctional; In Florida, Armor boss named to powerful commission

By Dan Christensen, FloridaBulldog.org 

Dr. Jose Armas, owner and president of Armor Correctional Health Services, right, and Gov. Rick Scott

The company that provides health-care services to thousands of jail inmates across Florida, including Broward and Palm Beach counties, has been kicked out of New York for allegedly “placing inmates’ health in jeopardy.”

Armor Correctional Health Services paid $350,000 in penalties and agreed not to bid on or enter into any contract to provide jail health services in New York state for three years, settling formal charges brought in July 2016 by New York Attorney General Eric T. Schneiderman. The lawsuit was filed after a dozen inmates died since Armor was hired, including five found to have received inadequate medical care, Schneiderman’s office said.

“For-profit jail providers must ensure that appropriate medical care is provided in jails, where many inmates suffer from complex medical needs,” Schneiderman said when the settlement was announced in October. “This settlement sends a clear message that companies who fail to provide the required health services to inmates won’t be tolerated in New York State.” Armor Correctional provided comprehensive medical services to the Nassau County Correctional Center.

Five months later, however, Florida Gov. Rick Scott appointed Armor Correctional founder and president Dr. Jose “Pepe” Armas to a coveted seat on the powerful Constitution Revision Commission that will recommend changes next year to the Florida Constitution.

Armas and companies he controls have contributed nearly $300,000 to Scott’s election campaigns, his Let’s Get to Work political committees and to the Republican Party of Florida.

“Armas is a distinguished physician and healthcare executive whose focus on patient-centered care has defined his career,” Gov. Scott’s office said in announcing his appointment to the commission in March.

New York Attorney General Eric Schneiderman

A spokeswoman for Armas at Miami’s EvClay Public Relations sought to downplay Armor Correctional’s New York troubles, saying the company had made a “business decision” to pull out of New York three years before the settlement. Similarly, she described Armas as “solely” an investor in Armor and “not involved in its daily operations.”

Florida corporate records, however, have for years listed Armas as Armor’s president. And the company’s federal income tax returns from 2009 through 2013 state that Armas owned 100 percent of Armor. They also show that in 2012-2013 Armor paid Armas $9.6 million in dividends.

What happened in New York wasn’t the first time an Armas-led company has been in trouble.

In 2013, Armas’s MCCI Group Holdings LLC paid $1.6 million to the U.S. Department of Justice to settle a whistleblower lawsuit under the False Claims Act alleging that MCCI had violated the federal Anti-Kickback Statute and the Anti-Inducement Act. MCCI denied the allegations, but also paid another $300,000 in attorney fees to the whistleblower’s attorney.

“MCCI reached a settlement to avoid the delay, inconveniences and expense of litigation,” said Armas spokeswoman Melisa Chantres.

At the time, MCCI owned and operated medical clinics in Miami-Dade and contracted with Humana, which was also named in the qui tam suit, to provide care, including prescription drugs, to Medicare and Medicaid beneficiaries.

The complaint, filed in federal court in Miami, did not allege any wrongdoing by Armas himself, but contended that MCCI broke the law “by providing to its current and potential Medicare beneficiaries free services and gifts, such as transportation, meals, beauty and salon services, massages and entertainment,” according to the settlement agreement. The illegal activities allegedly took place between 2000 and 2012.

Scott’s Medicare fraud case

Long before Scott became governor in 2011, he was the founder and CEO of health-care titan Columbia/HCA and at the center of a much larger Medicare fraud case. Scott quit Columbia/HCA amid an FBI probe in 1997, and the company he built later paid a record $1.7 billion in criminal and civil fines.

MCCI was named in another South Florida whistleblower case filed by Dr. Mario M. Baez in 2012 and made public last year. Baez accused MCCI, Humana and several Palm Beach County physicians of “upcoding,” a fraudulent billing scheme in which health-care providers charge Medicare, Medicaid and other insurance payers for more expensive services than were performed.

Last month, the U.S. formally intervened in the case to recover damages against only one of those defendants, Dr. Isaac Kojo Anakwah Thompson, and not against MCCI. Assistant U.S. Attorney Mark Lavine did not explain in court papers why the government declined to intervene against MCCI or Humana. Thompson, Baez’s former partner, was sentenced to 46 months’ imprisonment in July 2016 after pleading guilty to health-care fraud.

Baez could have filed an amended False Claims Act complaint to proceed against MCCI in the name of the United States, but did not do so. MCCI spokeswoman Chantres said the company was never served legal notice of the lawsuit and called Baez “a complete stranger to MCCI.”

Fort Lauderdale attorneys Christina Currie and Greg Lauer

In Broward, Armas’ Armor Correctional, its doctors and Broward Sheriff Scott Israel are defendants in a federal civil rights lawsuit in the death of William Herring Jr., 22, a mentally ill inmate who starved to death in December 2012 while allegedly being deprived of treatment.

The lawsuit filed last December by Fort Lauderdale attorneys Greg Lauer and Christina Currie notes that Armor was being paid $25 million a year by the sheriff’s office to provide comprehensive health care to county inmates.

“However instead of holding true to its promise Armor chose to maximize profits. Armor knew that the result of putting profits before patients would be that some inmates with serious medical conditions would not get the care that they were entitled to,” the lawsuit says.

The complaint goes on to identify five other Broward inmates who it says died “slow, horrible and preventable deaths in the same jail” from 2011-2012 because of Armor’s decision to maximize profits. The five are identified as: William Campbell, arrested for DUI; Gary Joseph Smith, arrested for possession of cocaine; Calvin Goldsmith, arrested for trespassing; Raleigh Priester, arrested for throwing a rock at a city employee; Arthur Sacco, arrested for an unspecified misdemeanor.

Broward Public Defender Howard Finkelstein’s office represents many inmates under Armor’s care. He said what he’s observed about Armor is disturbing.

“If you have a family member who is in jail and their life depends on Armor for medical treatment, you’re in trouble,” Finkelstein said. “The name of the game with Armor is to withhold treatment until the inmate is released, sent to prison and it becomes someone else’s treatment, or dies.”

Chantres said Armor does not comment on pending legal matters, but noted the company “strives to deliver excellent patient care daily.”

Miami judge rules out FOIA trial, says FBI document on 9/11 funding to remain secret

By Dan Christensen, FloridaBulldog.org 

Miami U.S. District Judge Cecilia Altonaga. Photo: Federal Bar Association, South Florida Chapter

Secret FBI information about who funded the 9/11 attacks will remain hidden indefinitely after a Miami federal judge reversed herself last week and decided that the FBI was not improperly withholding it from the public.

At the same time, Judge Cecilia Altonaga ruled out holding a Freedom of Information Act (FOIA) trial to evaluate the need for such continued secrecy nearly 16 years after the 9/11 attacks. A trial would likely have included testimony from government witnesses in support of continued secrecy as well as others like Bob Graham, the former Florida senator who co-chaired Congress’s Joint Inquiry into 9/11 and believes the FBI documents should be made public.

“The court sees no need for further facts to be elicited at trial,” Altonaga wrote in her seven-page order granting the FBI’s request to keep secret large portions of an FBI slide show titled “Overview of the 9/11 Investigation.” The FBI had argued the information was exempt from public disclosure because it “would disclose techniques and procedures for law enforcement investigations or prosecutions.”

Altonaga’s decision reversed her May 16 order that the 60-page document – referred to in court papers as “Document 22” – that was shown to the 9/11 Review Commission on April 25, 2014, should be largely opened for public inspection. The commission is also known as the Meese Commission, after its most prominent member, Reagan-era attorney general Ed Meese.

Florida Bulldog attorney Thomas Julin said the judge “should have ordered the FBI to stand trial for its decision to withhold information about its investigation.” He added that an appeal is being considered.

“The order requires the FBI to release information that was illegally redacted. That information will shed light on 9/11, but we did not get everything we wanted,” said Julin. “Much of what we did get confirmed the Bulldog’s reporting about Sarasota has been 100 percent correct and the FBI lied to the public about that. This case may be headed to the Supreme Court.”

Graham disappointed by ruling

Sen. Graham was disappointed by the judge’s ruling. He said the FBI’s 9/11 overview likely contains “important information relating to the funding of 9/11 and presumably the role of Saudi Arabia in doing so. Knowledge of these facts could change public opinion and governmental actions as to the liability of the Saudis as allies and the wisdom of us supplying them with hundreds of billions of dollars of military armaments.”

Bob Graham

Graham said, “The court essentially accepted without detailed substantiation the FBI’s assertions that techniques and procedures would potentially be compromised. I believe a trial was needed at which those unsubstantiated statements would be challenged with questions such as, ‘Over the 16 years since the events of 9/11 occurred have these techniques and procedures which proved to be so ineffective in preventing 9/11 been continued?’”

Florida Bulldog, working with Irish author Anthony Summers, first reported in September 2011 about a secret FBI investigation into a Saudi family living in Sarasota who abruptly departed their home in an upscale, gated community about two weeks before the 9/11 attacks – leaving behind their cars, clothes, furniture and food in the refrigerator. A senior counterterrorism agent said authorities later found phone records and gatehouse security records that linked the home of Abdulaziz and Anoud al-Hijji to 9/11 hijackers, including Mohamed Atta.

The FBI kept its Sarasota investigation secret for a decade. Former Sen. Graham has said the FBI did not disclose it to either the Joint Inquiry or the original 9/11 Commission.

An April 2002 FBI report released by the FBI during the litigation confirmed that account, saying agents found “many connections” between the Sarasota Saudis and “individuals associated with the terrorist attacks on 9/11/2001.” The FBI has since sought to discredit that report, saying the unnamed agent who wrote it had no basis for doing so.

The lawsuit forced the FBI to review 1,858 pages of records and to release parts of 713 pages. The FBI withheld 1,145 pages.

“The FBI violated FOIA by failing to respond to the Bulldog’s request for the Meese Commission records,” said Julin. “The Bulldog would not have gotten any of the records if it had not filed the lawsuit.”

The FBI PowerPoint pages Judge Altonaga has now ruled should remain under wraps include:

  • Two pages titled “Funding of the 9/11 Attacks” and “Early to Mid-2001 Additional Funding”
  • Pages titled: “Early to Mid-2000: Pilots/Intended Pilots Arrive U.S.”; “Investigative Findings” regarding hijacker “Identification” and “Financial. Ample Financing was provided”; “Early to Mid-2001: Non-pilots arrive U.S.”; “July-August 2001: Knife Purchases”; “August 2001: Reserving 9/11 Tickets”
  • Four pages titled “Ongoing Investigation”

Who bankrolled the 9/11 attacks is the central question at issue in complex civil litigation in New York in which 9/11 victims – survivors and relatives of the nearly 3,000 dead and businesses that suffered property damage – are seeking enormous damages from the oil-rich monarchy of Saudi Arabia. The country has denied any role in funding the September 11 attacks.

Seeking 9/11 Review Commission files

Florida Bulldog, through its corporate parent Broward Bulldog Inc., sued the FBI in June 2016, seeking records of the 9/11 Review Commission, a congressionally authorized body whose duties included reviewing new evidence not considered by Congress or the original 9/11 Commission. The Review Commission, whose members were chosen, paid and spoon-fed information by the FBI, issued its report in March 2015.

The FBI released a heavily redacted copy of its 9/11 Overview in February. The FBI cited national security, privacy and other reasons to withhold much information, including Exemption 7(E) of the Freedom of Information Act, which protects law enforcement “techniques and procedures.”

On May 16, Judge Altonaga ruled that the FBI had “failed to meet its burden in establishing Exemption 7(E) applies to the redacted information” in the 9/11 Overview because “much of it does not discuss any FBI investigative techniques and procedures; instead the material often encompasses facts and information gathered FBI suspects.”

In early June, the FBI asked Altonaga to reconsider her ruling, arguing that while the overview doesn’t “discuss techniques and procedures, the information contained in the document could still reveal” them. For example, the FBI said it had withheld a photograph taken by a security camera because its release “would disclose the location of the security camera,” possibly enabling future terrorists to circumvent detection.

Attorneys for Florida Bulldog countered that security measures have changed “immensely” since 9/11 and the government had not shown that security measures “that supposedly would be revealed would be of any utility to future terrorists.”

Altonaga’s new order doesn’t address that argument, but nevertheless sided with the FBI, saying the redactions are “necessary to prevent disclosure of FBI techniques or procedures.”

Former Sen. Graham said what’s happened, including the FBI’s resistance to disclosing classified information about 9/11 and who was behind it, is evidence that the Freedom of Information Act needs significant reform.

“The most fundamental question now is whether the Freedom of Information Act as currently written and administered is a barrier to Americans’ fundamental right to know what their government is doing,” Graham said.

Judge Altonaga’s order requires the government to draft a proposed final summary judgment order for the court’s consideration by July 11.

 

FBI asks Miami judge to reconsider, keep secret ‘sensitive details’ about 9/11

By Dan Christensen, FloridaBulldog.org 

The 9/11 hijackers

The FBI is pushing back against a federal judge’s findings that certain classified details about the funding of the 9/11 attacks and the 19 al Qaeda suicide hijackers should be made public.

Specifically, the government is asking Miami U.S. District Judge Cecilia Altonaga to reconsider her May 16 ruling that would largely open for public inspection a 60-page FBI slide show titled “Overview of the 9/11 Investigation.” The FBI showed the overview to the 9/11 Review Commission in secret on April 25, 2014.

The FBI released some of the overview’s pages in full earlier this year, but many more were either partially blanked out or withheld completely for privacy or other reasons. The overview and numerous other FBI records are the focus of an ongoing Freedom of Information Act (FOIA) lawsuit brought by Florida Bulldog one year ago.

Here’s what an FBI official told the court last week about four blanked-out PowerPoint slides regarding “the transfer of money prior to and funding of the attacks”:

“The release of this information would reveal sensitive details about how much money was being moved around, when it was being moved, how it was being moved, the mode of transfer and locations the FBI had detected movements in. Disclosure of this information would provide a playbook to future subjects on how much money one can move around in certain forms without attracting attention,” FBI record chief David M. Hardy said in his sixth declaration in the case.

Questions about who financed the 9/11 attacks are at the heart of sprawling civil litigation brought against the Kingdom of Saudi Arabia and others by survivors and relatives of the nearly 3,000 people who died that day. The plaintiffs and their lawyers contend that the kingdom, its official charities and others were responsible. Saudi Arabia has strenuously denied any wrongdoing.

Florida Bulldog’s Miami FOIA case seeks records of the 9/11 Review Commission. The Bulldog also sued the FBI in 2012 in federal court in Fort Lauderdale seeking records about its 2001-2002 Sarasota investigation of a Saudi family who moved abruptly out of their upscale home two weeks before 9/11 – leaving behind cars, clothes, furniture and other personal possessions. The probe was triggered by neighbors’ calls to authorities, but the FBI never disclosed its existence to Congress or the original 9/11 Commission.

Six months after that initial FOIA case was filed, the FBI released a small batch of records, including an April 2002 report that said agents found “many connections” between the Sarasota Saudis and the hijackers. In 2014, the FBI told the 9/11 Review Commission in closed session that the agent who wrote the 2002 report had no basis for doing so, but did not further explain or identify the agent.

Also in 2014, Fort Lauderdale U.S. District Judge William Zloch ordered the FBI to produce its records about the matter. The FBI turned over all classified records about 9/11 maintained in its Tampa field office — 80,000 pages. The judge continues to review those documents for possible public release.

Trial date sought

Judge Altonaga’s order last month granted in part and denied in part an FBI motion for summary judgment, notably on the lawfulness of the FBI’s redactions of certain information from several records that it has produced. The FBI, however, has not restored any of those redactions, and attorneys for the Bulldog have asked the judge to set a date for trial this summer.

“At trial, the FBI will be required to offer admissible evidence through witnesses – not through inadmissible hearsay by declaration – to attempt to sustain the redactions,” wrote attorney Thomas Julin in a June 2 “Joint Status Report” to the court. “The Bulldog will have the opportunity, in accordance with due process, to cross-examine any FBI witnesses presented.”

The government asked Judge Altonaga to reconsider her prior ruling the same day. The judge has not yet decided whether an FOIA trial is needed, but if one does happen it would be highly unusual.

Hardy, who heads the FBI’s Records/Information Dissemination Section (RIDS), went on in his most recent declaration to discuss other redacted pages in the 9/11 Overview. He said they were withheld to protect FBI “techniques and procedures not well-known to the public as well as non-public details about the use of well-known techniques and procedures.” Hardy’s descriptions shed some light on what’s in those records.

One page, withheld in full, “is a photo taken by a security camera.” The FBI does not identify the photo’s subject, the date it was taken or its general location.

“This was withheld because the release of this picture would disclose the location of the security camera at the site where the photo was taken. The disclosure would allow future subjects to know where to find the security camera so as to avoid the area in which the camera points, thereby circumventing detection or the ability for the FBI and law enforcement to try to obtain an image of the subject.”

Two more pages from the overview section about the FBI’s “ongoing investigation,” also completely withheld, contain “information about a conspirator and his actions taken in preparation for the attacks. This is sensitive information, which if revealed, would put at risk the collection techniques used to obtain such information. It also reveals sensitivities that future subjects could exploit in the future while planning and performing an attack.”

‘Under the radar’

Another page the FBI wants to remain hidden “contains specific factors deemed pertinent in the analysis of the actions of the hijackers’ concerning financial transactions before September 11, 2001. Disclosure of this information would reveal what the FBI already knows about the hijacker’s [sic] financial actions and how they were able to stay ‘under the radar.’”

The FBI’s Hardy similarly advocates for secrecy regarding:

  • The kinds of weapons and identification the conspirators carried.
  • Information about the arrival of the pilots, intended pilots and conspirators in the U.S.
  • Information about when the conspirators moved to their respective departure cities and the timing of their plane ticket purchases.
  • “A timeline of telephone records and money transfers between conspirators.”
  • Information about “previous flights the conspirators took before the attacks to include the collection and timing and locations of flights.”

Finally, Hardy said that information about “investigative leads derived from forensic analysis” and “leads and the sources of data the FBI finds useful to or significant in its analysis” should also remain veiled.

“The places the FBI does not look for information can be just as telling as the places it does look for information,” Hardy wrote.

In responding to Hardy’s assertions in court papers filed Monday, attorneys for Florida Bulldog noted that the “referenced techniques apparently are those techniques that the 9/11 hijackers evaded on September 11, 2001. One would hope that different techniques are in place today.”

“If anything, the PowerPoint slides might reveal outdated, failed law enforcement acts or omissions,” wrote attorney Julin. “The 9/11 attacks on the United States are a consequence, at least in part, of the failure of the FBI and other law enforcement agencies to detect and halt them.”

The government has until Monday, June 19 to file a reply. The judge will then decide whether the case will go to trial.

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