Friday, March 14, 2014

Royal Navy confirms torpedo incident at Devonport

Royal Navy confirms torpedo incident at Devonport

HMS Argyll Credit: Ulrich Perrey/DPA/Press Association Images
The Royal Navy has confirmed that a training torpedo was accidentally launched inside Devonport Naval base in Plymouth on Wednesday. No one was hurt in the incident in which a test torpedo was "jettisoned onto the wharf."
Royal Navy statement:
We can confirm an incident occurred onboard HMS Argyll on Wednesday 12th March at 3.24pm, while the ship was alongside at Devonport Naval Base in Plymouth.
During a training exercise, an inert Test Variant Torpedo (TVT) unexpectedly jettisoned onto the wharf. There was no explosion and no casualties.
An investigation is now under way to determine the cause of the incident.
HMS Argyll was conducting a system test when an inert Test Variant Torpedo was jettisoned unexpectedly. The torpedo is not an explosive hazard.
The specific details of the incident are subject to further investigation and it would be inappropriate to comment further.
A Test Variant Torpedo is a dummy weapon with no explosive content.
There were no casualties involved.
No one was on the jetty at the time of the firing
The torpedo caused minor damage to an adjacent security fence (inside the naval base) where it landed.
The result of the investigation will determine what actions will be necessary to avoid any repeat of this incident in the future. However, torpedo system test firing alongside in the naval base has been suspended subject to completion of the investigation.

UK Navy ships fires torpedo at nuclear sub dockyard

UK Navy ships fires torpedo at nuclear sub dockyard

Published time: March 14, 2014 20:13
Royal Marine Boarding Team in front of the HMS Argyll (AFP Photo / Mod)
Royal Marine Boarding Team in front of the HMS Argyll (AFP Photo / Mod)
HMS Argyll fired a torpedo by mistake during a training drill at the Devonport dockyard in Plymouth south west England, where nuclear submarines are also docked.
The incident occurred on Wednesday afternoon, during the Navy’s Flag Officer Training.
Workers were shocked to see a the 2.6-meter long torpedo shoot out of the side of a ship, fly 200 meters through the air, blast a hole through a security fence and then slam into a metal storage container.
HMs Argyll, a type 23 Frigate, was the one to fire the torpedo during the training exercise, according to the Royal Navy. However the torpedo was a dummy and therefore not armed with explosives.
“We can confirm an incident occurred onboard HMS Argyll… while the ship was docked alongside at Devonport Naval Base in Plymouth. During a training exercise, an inert Test Variant Torpedo (TVT) unexpectedly jettisoned onto the wharf. There was no explosion and no casualties,” a Royal Navy spokesman said.
A major investigation has been launched into the incident.
“If anyone was inside it they would have had a nasty shock – the whole side of the container was stoved in. Had the thing been armed it would have let out a 200-meter blast. You could be talking about a major loss of life,” a source told the Plymouth Herald.
This is the second armed forces blunder reported by the Herald in as many weeks.
Earlier this month a live artillery shell went five miles off course, narrowly missing a main road and an entire village before exploding in a field near a railway line.The incident happened on Salisbury Plain, where marines based at Plymouth frequently train.
The latest incident comes as the Defense Secretary Phillip Hammond promised £300 million ($500 million) in extra cash for the Royal Navy’s submarine construction yard in Barrow in Furness, Cumbria, where the new Trident replacement will be built if the go ahead is given as expected in 2016.
However, navy chiefs have warned that defense cuts mean they are barely able to carry out their commitments, and have warned politicians that the Royal Navy is seriously undermanned.

Florida Muslim Sami Osmakac’s American Dream: Blowing up the Bridges crossing Tampa Bay, Bombing sheriff’s office and police departments


Florida Muslim Sami Osmakac’s American Dream: Blowing up the Bridges crossing Tampa Bay, Bombing sheriff’s office and police departments

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“My dream was always here. It’s better for, to get it, for them to get it here … ‘cause that’s why America loves to go to war with people, ‘cause they think nobody can attack them in their country. That’s why they’re so shocked about the Muslims. Because they brought it here … ”
More jihad in America by the devout who studied and followed Islam religiously. Sami Osmakac is an  Albanian from Kosovo, Serbia and is a naturalized US citizen. More Balkan gratitude for American blood and treasure fighting for the Muslims in Bosnia against the Christian Serbs.
Tampa jihad
“Osmakac considered several terrorism options, court documents say,” Tampa Tribune, thanks to Halal Pork Shop (via The Religion of Peace)
TAMPA — Sami Osmakac toyed with the idea of blowing up the bridges crossing Tampa Bay or detonating bombs at the sheriff’s office and police departments before settling on a plan to plant explosives in Tampa’s Hyde Park party district and then spraying first responders with automatic gunfire, according to recently released court documents.
The planned January 2012 attack, Osmakac said in a “martyrdom video,” would be “payback for Sheikh Osama Bin Laden, may he rest in peace. ”
The plots are detailed in a 37-page report by a terrorism expert hired by the U.S. Attorney’s Office in Tampa to help in its case against Osmakac, a self-described jihadist who said he was too radical even for Hamas and other fringe Muslim groups.
[...]
In one recording Osmakac says:
“My dream was always here. It’s better for, to get it, for them to get it here … ‘cause that’s why America loves to go to war with people, ‘cause they think nobody can attack them in their country. That’s why they’re so shocked about the Muslims. Because they brought it here … ”
Osmakac discussed a plan to use fishing boats to plant bombs on the bridges that span Tampa Bay and even one bridge in Sarasota. All he needed, he said was five people, maybe fewer, to carry out the plot.
“They’ll really be terrified,” he told the confidential informant. “Just take down the bridges, they can’t do nothing for a month. Nobody’s going to work, that’s gonna stop like three million people. They gonna be stopped. This area has millions, with Pinellas and Tampa … has like two, three million people. They all, nobody’s going to work.”
Defense attorney George Tragos’ motion was filed Wednesday. A hearing date has not been set.
Tragos said in the motion that Kohlmann’s conclusions aren’t valid.
“Mr. Kohlmann here is attempting to classify Mr. Osmakac using rank speculation without evidence,” the motion says.
His testimony is being presented to the jury “to inflame their emotions with reference to Mr. Osmakac and to prejudice them in a way as to shift their attention from the charges filed by the government.”
The motion says the government has plenty of evidence to present, “without the necessity of this ‘smear campaign.’ ”
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live House Democrats helped pass the ENFORCE the Law Act in a 233-181 vote Wednesday, in spite of a threat by Obama to veto it.

live House Democrats helped pass the ENFORCE the Law Act in a 233-181 vote Wednesday, in spite of a threat by Obama to veto it.
The ENFORCE the Law Act would require the faithful execution of the laws as they were written by Congress, regardless of the preference of the executive branch. The sponsor, Rep Trey Gowdy (R-SC) cited Obama’s disregard for the laws Congress has written and selective enforcement as necessitating a means to require the executive branch to respect the laws.
Only six Democrat votes would be needed to join Senate Republicans on order to pass the bill and send it on to Obama who has threatened a veto. He contends it violates the separation of powers, but it may be the curtailing of his power which is really the issue.
A showdown with Obama is unlikely to happen, as Majority Leader Harry Reid (D-NV) will not let the bill come to the Senate floor for a vote.
In pushing for the bill to receive consideration in the Senate, Boehner said, “The president doesn’t get to decide which laws he’s going to enforce any more than Americans get to decide which laws they’re going to follow.”
He continued, “The fact that the president would threaten to veto a measure requiring him to uphold his constitutional obligations underscores why this bill is needed, and why Senate Democrats should pass it immediately.”
If nothing else, the midterms and Obama’s increasing unpopularity could combine with his growing exposure to force some movement. At least an attempt is being made to control the lawlessness. It’s unfortunate that Harry Reid doesn’t have to face the voters this fall.
Rick Wells

UN Appoints Sarah Palin to Mediate Ukraine Crisis

UN Appoints Sarah Palin to Mediate Ukraine Crisis

Mar 02, 2014
PalinUkraineThe United Nations has appointed Sarah Palin as a special envoy to Ukraine, hoping she can help mediate a solution to the growing geopolitical crisis in that country.
According to sources close to the situation, Palin and a team of international crisis experts will fly to Kiev tonight to meet with Ukrainian officials before moving on to Moscow to negotiate a final settlement with Russia’s President Vladimir Putin over the fate of the disputed Crimea region.
The surprising selection comes just days after Palin boasted on Facebook that she had accurately predicted Russia’s invasion of Ukraine in a 2008 speech.
In an exclusive interview, U.N. President Ban Ki-Moon said he chose Palin because of her impressive first-hand knowledge of the region and hopes she can facilitate a dialogue that avoids war.
“When all the experts said Putin would never invade Ukraine, only Sarah Palin had the courage to challenge conventional wisdom,” he explains. “Clearly this woman is some sort of a genius or something. We can’t let her skills go unused.
“This is a very unusual crisis, and we need to think outside the box. One of my advisers suggested this solution, and I felt it was a risk worth taking. Let’s throw Palin into the mix and see what she can do.”
Polar Opposites
Russia effectively invaded the Ukrainian region of Crimea last week after a pro-European revolution in Kiev threw out President Viktor Yanukovych, a corrupt despot many viewed as a puppet of Moscow.
The peninsula was long in Russian territory, and was only transferred to Ukraine in 1954. The majority of Crimea's population is still ethnically Russian and its warm water ports hold deep strategic significance for the Russian Navy.
Although not usually thought of as a foreign policy expert, Palin did accurately forecast these events in 2008 when at a campaign event she was quoted as saying that Obama’s weakness towards Moscow was  “the kind of response that would only encourage Russia's Putin to invade Ukraine next.”
Her comments were ridiculed by many, including Foreign Policy magazine, which labeled them “strange” and “far fetched.” Not content to say I-told-you-so, Palin is now hoping to turn her new-found credibility into meaningful action.
“I’m just hoping to bring a little Wasilla main street to folks over there in Russia,” she says. “Someone needs to go over there and teach Mr. Putin that he can’t be bossing these nice Ukrainese people around.
“Russia’s invasion of Crimea is a gross violation of international law. What kind of country invades another country that hasn't attacked it first? I mean, who does that?”
Although the pick has already attracted fierce criticism and disdain around the world, Secretary Ban is confident that he’s chosen the right woman for the task.
“If it’s one thing I know about Sarah Palin, it’s that she never quits a job half-way through. I believe she can end this crisis once and for all,” he asserts.

Allegations of PFC Eugene Dinkin

Allegations of PFC Eugene Dinkin


CIA OUT Teletype No. 85770, notifying the White House and other federal agencies on 29
Nov 1963 of Dinkin's allegation.

Private First Class Eugene Dinkin was a cryptographic code operator stationed in Metz, France. On November 4, 1963 he went AWOL from his unit, and entered Switzerland using forged travel orders and a false Army identification card. On November 6, he appeared in the Press Room of the United Nations in Geneva and told reporters he was being persecuted. He also told reporters that "they" were plotting against President Kennedy and that "something" would happen in Dallas. After Kennedy was murdered, a friend of Dinkin's named Dennis De Witt told military authorities that Dinkin had predicted Kennedy's assassination for November 28, and later changed the date to November 22.
Dinkin was arrested on November 13 and placed in a psychiatric hospital, and latered transferred to Walter Reed, where he underwent various psychological tests before eventually being released. His allegation reached the White House on November 29, and went to the Warren Commission in April of 1964.
Retellings of the Dinkin story typically note his status as a crypto operator, and speculate that he may have learned of an assassination plot decrypting military communications, perhaps between military plotters and Marseilles assassins. But the FBI reports on Dinkin, including interviews with him conducted in April 1964, state that the allegations came about from Dinkin's study of military publications such as Stars and Stripes. Dinkin told the FBI that it was his study of "psychological sets" which revealed to him both an anti-Kennedy bias as well as a military plot in the works. How we could divine the latter, and in particular attach dates and places for the upcoming murder, is hard to imagine.
One explanation would be that Dinkin indeed learned about a plot through his crypto assignment, and that something about his confinement at Walter Reed led him to suppress this in favor of the story the FBI reported. An opposing view would of course be that he was a paranoid individual who happened to make a lucky guess.
One method of determining the truth would have been to interview his military associates to see what he told them about where his ideas came from, including those named by Dinkinin his FBI interviews: PFC Dennis De Witt, PFC Larry Pulles, Sgt. Walter Reynolds, and R. Thomas. The FBI, after taking these names, does not appear to have followed up on them. The Warren Commission took no interest in the matter, and indeed omitted any mention of Dinkin from its purportedly encyclopedic 26 volumes of evidence.

RESOURCES:

Essays
Eugene B. Dinkin: Foreknowledge?, by Noel Twyman (except from Bloody Treason).
Foreknowledge In England - the Cambridge Call? (Eugene Dinkin section), by Mark Bridger.

Mary Ferrell Database

Documents
Warren Commission Documents:
  • CD 788 - FBI Letterhead Memorandum of 09 Apr 1964 re: Eugene Dinkin
  • CD 943 - CIA Helms Memorandum of 19 May 1964 re: Eugene B. Dinkin
  • CD 1107 - FBI Gemberling Report of 15 May 1964 re: Assassination of Pres. Kennedy (5 Volumes): Section entitled "RE: EUGENE B. DINKIN"
 
Documents (continued)
CIA Cable of Nov 1963. This redacted pre-assassination cable appears to relate to the search for the missing Dinkin.
CIA Cable from Bern to Director. A 26 Nov 1963 cable discusses filing of Dinkin story by Time-Life stringer Alex Des Fontaines.
OUT TELETYPE NO. 85770. On 29 Nov 1963, this teletype alerted the White House, State Department, FBI, and Secret Service to the Dinkin story. See also the cable on which it is based.
FBI Airtel from Director to SAC, WFO. This 20 Mar 1964 airtel instructed the Washington Field Office to prepare a memo on Dinkin for the Warren Commission.
Memo from Helms to Rankin. This CIA memo to the Warren Commission relayed OUT 85770 to the Warren Commission on 19 May 1964.
Letter from Dinkin to Colby. In this 1975 letter to CIA Director Colby, Dinkin requested information relevant to his lawsuit against the Dept. of Defense and the CIA.
Memo re: Eugene N. Dinkin v. Department of Defense and Central Intelligence Agency. On receiving Dinkin's complaint on 26 Jun 1975, this 8 Jul 1975 memo requested various CIA departments to look for relevant records.
Report: Leads Investigated by CIA, p.6. Among the many leads summarized in this document is the Dinkin allegation.

Report: White House Refuses to Release Key Benghazi Documents

Report: White House Refuses to Release Key Benghazi Documents

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The day after the terrorist attack on our mission in Benghazi, Libya in 2012, Barack Obama appeared before the country promising that he would get to the bottom of this, that accountability would be held, and that justice would be served.
However, almost a year and a half later, absolutely none of that has happened — and it seems the Obama Administration itself is making sure that it doesn’t.
According to an 88-page report from the bipartisan Senate Intelligence Committee, the Obama Administration “still has not provided all relevant documents to the Committee.” They also noted the White House’s “lack of cooperation” which has “unnecessarily hampered” their investigation.
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WND reports:
The White House, Pentagon and especially the Department of State are actively frustrating the Senate’s investigation into the Sept. 11, 2012, Benghazi attack, according to the Senate’s recently released 88-page report.
In a particularly stinging accusation that went largely unreported by news media, the Senate’s extensive report by its Benghazi investigative committee charged a “strong case can be made that State engaged in retaliation against witnesses who were willing to speak with Congress.”
“No reasonable explanation accounts for the State Department’s unacceptable treatment of these witnesses,” read the report.
The lawmakers also accused the State Department of returning some witnesses to active duty so they were “shielded from, or actively avoided, Committee requests for interviews.”
The Senate document revealed that not only have key executive branch witnesses declined to be interviewed, the White House “still has not provided all relevant documents to the Committee.”
Other documents were only provided on a “read only” basis, meaning that the Senate committee was “only permitted to view them for a limited period of time, while being supervised by the coordinating agency, and had to rely upon our notes when preparing the report.”
The Senate investigation noted the Department of Defense and other U.S. agencies provided hundreds of key documents, “although sometimes with a significant amount of resistance, especially from State.”
“This lack of cooperation unnecessarily hampered the Committee’s review,” said the report.
What little information we have gotten from investigations from the House and the Senate have revealed damning information that just begs more questions. Judging by the Obama Administration’s complete lack of haste in “getting to the bottom of” these four murders in Benghazi, these reports are just the tip of the iceberg.
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Support for an independent, special investigation — which would bypass Eric Holder, John Boehner, and even Obama — is growing each day that this scandal remains unsolved and justice remains to be served. Help spread the word by sharing this article on Facebook and Twitter.

Bombshell: State Department Knew Terrorists Wanted to Kill Ambassador

Bombshell: State Department Knew Terrorists Wanted to Kill Ambassador

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We are always learning new things about the terror attack that occurred in Benghazi in 2012, no thanks to President Obama’s White House.
The White House has refused to release key documents in their possession about what happened that night, and even the New York Times says there is a coverup of Benghazi.
A Congressional report released a couple of months ago alludes to the coverup and places the blame for what happened on the shoulders of the White House and Hillary Clinton’s State Department.
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House report traces IRS scandal to Obama

House report traces IRS scandal to Obama

Produces evidence Lois Lerner followed White House lead

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NEW YORK – A House committee investigating the IRS scandal has found a link between President Obama’s criticism of the Citizens United Supreme Court decision and subsequent steps taken by IRS official Lois Lerner to discriminate against conservative groups.
Lerner was responding to political pressure in her efforts to clamp down on conservative organizations seeking tax-exempt status in the wake of the 2012 Supreme Court case Citizens United v. Federal Election Commission, concluded a 141-page report released last Tuesday by the Republican-majority staff of the House Oversight and Government Reform Committee.
Lerner twice has invoked the Fifth Amendment and refused to answer questions in appearances before the committee.
The report clearly raised the question of whether or not the political pressure came from the White House.
“It’s not the job of the IRS to overrule the Supreme Court, and it’s not the job of the IRS to crush political movements its leaders dislike,” the report said. “Her deep involvement in this scheme raises even more questions about who else was involved – including at the White House.”
The report said Lerner “led efforts to scrutinize conservative groups while working to maintain a veneer of objective enforcement.”
Following Obama’s lead?
The House report linked statements made by President Obama in political speeches during the 2010 mid-term election attacking the Citizens United Supreme Court decision with emails and speeches Lerner subsequently wrote expressing her intent to administer the IRS tax-exempt division in a partisan manner.
On Jan. 23, 2010, President Obama declared the Citizens United “ruling strikes at our democracy itself” and “opens the floodgates for an unlimited amount of special interest money into our democracy.”
Less than a week later, the president publicly criticized the decision during his State of the Union address.
“With all due deference to separation of powers, last week the Supreme Court reversed a century of law that I believe will open the floodgates for special interests – including foreign corporations – to spend without limit in our elections,” he said. “I don’t think American elections should be bankrolled by America’s most powerful interests, or worse by foreign entities. They should be decided by the American people.”
The report pointed out that over the next several months, Obama continued his public tirade against the Supreme Court decision, so-called “secret money” in politics and the emergence of conservative grassroots groups.
In a July 2010 White House Rose Garden speech, the president proclaimed: “Because of the Supreme Court’s decision earlier this year in the Citizens United case, big corporations … can buy millions of dollars worth of TV ads – and worst of all, they don’t even have to reveal who’s actually paying for the ads.
Obama said “these shadow groups are already forming and building war chests of tens of millions of dollars to influence the fall elections.”
He made a similar statement in an August 2010 campaign event.
“Right now all around this country there are groups with harmless-sounding names like Americans for Prosperity, who are running millions of dollars of ads against Democratic candidates all across the country,” Obama said.
“And they don’t have to say who exactly the Americans for Prosperity are. You don’t know if it’s a foreign-controlled corporation. You don’t know if it’s a big oil company, or a big bank. You don’t know if it’s a insurance [sic] company that wants to see some of the provisions in health reform repealed because it’s good for their bottom line, even if it’s not good for the American people.”
Then, at a September 2010 campaign event, Obama stated: “Right now, all across this country, special interests are running millions of dollars of attack ads against Democratic candidates. And the reason for this is last year’s Supreme Court decision in Citizens United, which basically says that special interests can gather up millions of dollars – they are now allowed to spend as much as they want without limit, and they don’t have to ever reveal who’s paying for these ads.”
‘Need to have a plan’
The House committee report cited emails Lerner wrote subsequent to Obama’s 2010 speeches in which she argued that IRS officials “need to have a plan” to handle the applications from certain tax-exempt groups.”
Yet, she couched the aim with language that suggested she wanted to cover her partisan goals, writing for instance, “We need to be cautious so it isn’t a per se political project.”
The report also noted that on Oct. 19, 2010, Lerner spoke at an event sponsored by Duke University’s Sanford School of Public Policy in which she referenced in her speech the political pressure the IRS faced to “fix the problem” of 501(c)(4) groups engaging in political activity.
“What happened last year was the Supreme Court – the law kept getting chipped away, chipped away in the federal election arena. The Supreme Court dealt a huge blow, overturning a 100-year old precedent that basically corporations couldn’t give directly to political campaigns. And everyone is up in arms because they don’t like it. The Federal Election Commission can’t do anything about it,” Lerner said.
“They want the IRS to fix the problem. The IRS laws are not set up to fix the problem: (c)(4)s can do straight political activity. They can go out and pay for an ad that says, “Vote for Joe Blow.” That’s something they can do as long as their primary activity is their (c)(4) activity, which is social welfare.”
Consequently, Lerner said, “everybody is screaming at us right now: ‘Fix it now before the election. Can’t you see how much these people are spending?’”
She said she wouldn’t know until she looks at the IRS Form 990s “whether they have done more than their primary activity as political or not.”
“So I can’t do anything right now,” she said.
While the House Oversight Committee lacked documentation proving Lerner was given a direct order by the White House to discriminate against conservatives, the report demonstrated that Lerner, along with several other senior IRS officials, established in early 2011 a “multi-tier review” process that resulted in long delays for tax-exempt applications submitted by conservative organizations.
The report stressed Lerner’s goals in implementing procedures to delay or deny tax-exempt applications by conservative groups was to help Democrats to win elections.
“Even without her full testimony, and despite the fact that the IRS has still not turned over many of her e-mails, a political agenda to crack down on tax-exempt organizations comes into focus,” the report concluded. “Lerner believed the political participation of tax-exempt organizations harmed Democratic candidates, she believed something needed to be done, and she directed action from her unit at the IRS.”
The report said the committee continues to offer Lerner the opportunity to testify, even though there is not much reason to be optimistic it will happen unless she is given immunity.
“Many questions remain, including the identities of others at the IRS and elsewhere who may have known about key events and decisions she undertook,” the report noted in the final paragraph. “Americans, and particularly those Americans who faced mistreatment at the hands of the IRS, deserve the full documented truth that both Lois Lerner and the IRS have withheld with them.”
‘I am tired of this’
WND reported Issa adjourned last week’s hearing after asking only seven questions when Lerner asserted for a second time her Fifth Amendment privilege not to incriminate herself.
On June 28, 2013, the House Oversight Committee voted that Lerner had waived her Fifth Amendment privilege by making a voluntary opening statement asserting her innocence at a May 22 hearing.
Prior to the hearing last week, Lerner had indicated she would only testify in exchange for a grant of immunity; subsequently, in a series of emails between Lerner’s attorney and committee staff, she agreed to testify openly, but requested a one-week delay for the March 5 hearing.
When Issa adjourned the hearing last week, ranking member Rep. Elijah Cummings, D-Md., objected with an angry tirade that prompted Issa to have his mic cut off.
“I am a member of the House of Representatives and I am tired of this,” Cummings asserted in an angry voice.
For several minutes after Issa gaveled the hearing to a close, Cummings continued to read his statement into a closed microphone as the hearing room emptied and Lerner sat at the witness table listening.
On Jan. 12, WND reported that the IRS has proposed new rules that would limit the ability of conservative 501(c)4 groups to participate in the mid-term elections this November as they had in 2010, when Republicans grabbed majority control of the House of Representatives.
Last week, WND reported Cleta Mitchell, a leading Washington-based attorney representing a number of grass-roots organizations claiming they were targeted by the IRS, said at the CPAC annual conference of conservatives last week that the Department of Justice had questioned Lerner sometime during the previous six months. However, the department, under Attorney General Eric Holder, so far has declined to initiate criminal prosecutions against Lerner or any other IRS officials implicated in the discrimination scandal.

Trey Gowdy Gives Interview Explaining Why He’s Fighting Obama

Trey Gowdy Gives Interview Explaining Why He’s Fighting Obama

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South Carolina Representative Trey Gowdy has received a lot of news coverage lately, mostly because he speaks truth and common sense in a fearless manner.
He has called out Susan Rice for lying about Benghazi, demanded subpoenas for Hillary Clinton‘s involvement in Benghazi, and said Nancy Pelosi is “mind-numbingly stupid” for her lies about the GOP.
Gowdy has criticized Obama for his lawlessness and corrupt administration, and is seeking to sue him over his unconstitutional implementation of the DREAM Act immigration reform.
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Trey Gowdy recently introduced a bill that would give Congress standing and an expedited process in lawsuits to reign in the Executive branch, and his bill just passed the House.
Last night he appeared on Fox News’ The Kelly File with Megyn Kelly to discuss his fiery speech on the House floor in support of his bill.  Asked about his speech, he said:
“I was having an interesting time listening to the debate between Senator Obama and President Obama.”
“One reason that folks in my line of work are not popular is because people view us as being guilty of duplicity.  If our team is in charge we have one set of rules.  If our team is not in charge we have another set of rules.”
Megyn Kelly asked if he believed the President would continue to take more Executive actions. Gowdy responded:
“It depends whether we let him get away with it or not.  It depends whether we live in a country where the ends justify the means or process matters.”
Watch the full interview here.
Gowdy on Megyn kelly
Trey Gowdy is right on the duplicitous nature of Obama, who says one thing and does another.  Unfortunately, far too many others in Congress are the same.  It is high time the people kick most of Congress out of office.
America needs more people in Congress like Trey Gowdy.  People that are unafraid to speak the truth and call out things the way they see them.  We need men and women that will stand on principle, defend the Constitution and do the right things for our country.
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Here’s How We Can Force Congress To Read The Bills They Vote On

Here’s How We Can Force Congress To Read The Bills They Vote On…

How to deal with this reality, which has been many years in the making, is a difficult challenge.


congress-hall-house-of-reps-5x7
ALEXANDRIA, VA — In mid-January, Congress rushed through a massive spending bill of 1,582 pages; the accompanying explanatory statements added another 1,278 pages. It was voted on only 44 hours after it was posted, giving members of Congress less than a minute to read each page — if they gave up a night’s sleep.
When asked whether he read this $1.1 trillion bill, Rep. Earl Blumenauer (D-OR) was honest. He responded, “Nobody did.” This bill will fund the federal government for the rest of fiscal year 2014, which ends September 30, 2014. The bill increases federal spending by $44.8 billion this year over the spending level previously set by Congress.
How many members of Congress know that this bill gives the oil and nuclear industries $154 million more than the Energy Department requested for nuclear energy, and $141 million more than requested for fossil-fuel development? How many are aware that the bill skirts a ban on earmarks by providing more than $44 million for the Army Corps of Engineers that the administration had not requested — or that the Pentagon was given $666 million to study illnesses such as breast cancer that have little to do with matters of national defense? The list of what members of Congress do not know is in the bill is a long one.
None of this is new. In 2010, Congress passed, and President Obama signed, the Dodd-Frank Wall Street Reform and Consumer Protection Act. At 2,319 pages, it is significantly longer than previous financial reform laws and approaches the extraordinary length of the Affordable Care Act. By comparison, the Federal Reserve Act of 1913, which established the Federal Reserve banking system and the single national currency, was 31 pages long. The Glass-Steagall Banking Act of 1933, which overhauled the entire banking system in light of hundreds of bank failures, was 37 pages long.
The complexity in legislation has created an industry of lobbyists and consultants — often former members of Congress and former congressional staff members — to help individuals and businesses to cope with what has been imposed upon them. University of London economist Anthony G. Heyes notes, “It is precisely the complex, opacity, and user-unfriendliness which underpin the value of their expertise” that translate into “selling advice to those they previously regulated.”
Peter Schweitzer, president of the Government Accountability Institute and a senior fellow at the Hoover Institution, tells the story of Amy Friend, a chief aide to Sen. Christopher Dodd (D-CT) in crafting the Dodd-Frank financial reform bill and former chief counsel to the Senate Banking Committee. “After the bill passed,” he writes, “and became law, she left Capitol Hill and became managing director at Promontory Financial Group, which describes itself as ‘a premier global financial consulting firm.’ This Washington-based consulting firm is headed up by many people like Friend — people who were once responsible for erecting or interpreting arcane financial regulations in public service and then joined the group, where they can charge high fees to help firms interpret and comply with these befuddling regulations…. Banks complain about Promontory’s high fees, which can run up to $1,500 an hour. Eugene Ludwig, the former comptroller of the currency under Bill Clinton, reportedly makes $30 million a year running Promontory.”
Or consider Daniel Meade, who was chief counsel to the Financial Services Committee under Chairman Barney Frank (the “Frank” of Dodd-Frank). Meade left Capitol Hill for Hogan-Lovells, an established lobbying firm. When Meade arrived, the firm announced that Meade was “a principal drafts person of substantial portions of the Dodd-Frank Wall Street Reform and Consumer Protection Act.” The firm explained that Meade would be “representing financial services entities and other entities impacted by the regulation of those entities in connection with a broad range of regulatory and transactional matters, including issues related to the Dodd-Frank Act.”
John Hofmeister, the former president of Shell Oil, saw the process at work: “They deliberately write ambiguity into the law. It’s part of a career-building process. If you are a congressional staffer, you spend your career crafting complex legislative language. This equips you to leverage your post-government competence. The whole system builds on itself.”
“For congressional staffers… it’s a huge payday,” writes Peter Schweitzer. “Sen. Ron Johnson was first elected to the U.S. Senate in 2010 from Wisconsin. A businessman and entrepreneur, he has hired plenty of people over the years. When it came to hiring congressional staffers for his new job, he was struck by a phrase some applicants used during the interview process: ‘cashing in.’ ‘I had never heard that term before when hiring someone in the private sector,’ Johnson says. Time spent working at a lobbying firm or at a consultancy is ‘cashing in.’ Some people work on Wall Street until they have enough money to ‘cash out.’ In Washington, they set themselves up for those jobs in order to cash in.”
Alan Siegel, who for many years has advocated greater simplicity in communications and was called “Mr. Plain English” by PEOPLE magazine, says, “Complexity robs us of time, patience, understanding, money and optimism. The U.S. was founded and governed for over two centuries on the basis of a document that is six pages long. That is 0.1 per cent of the current income tax code, which currently runs a whopping 14,000 pages.” Even IRS commissioner Douglas Shulman admitted on C-SPAN that he cannot do his own personal tax return anymore because “it’s just too complicated.”
Prof. Anthony Heyes believes, “[P]eople working in regulatory agencies have too little incentive to make or keep procedures and practices simple, transparent, and user-friendly.” He argues that one-third of the costs of regulations are “transaction costs”– that is, “paying someone to help you jump through the ‘hoops and hurdles’ of the regulatory process.”
One way to simplify legislation and increase the possibility that members of Congress will read — and understand — the legislation on which they vote is to adopt a single-subject rule for all bills. Article III of the Florida Constitution, for example, “requires that every law shall embrace but one subject and matter properly connected there with.” It would be good, of course, to require members of Congress to actually read the bills they are going to vote on. Bills have been introduced that would require a seven-day waiting period between the time when a bill is ready for a vote and when the final vote actually takes place. Others suggest that all bills scheduled for a full vote on the floor be read out loud. There has even been a suggestion that all members be required to read the bills before voting — and to sign a legal affidavit attesting to that fact.
Such proposals may be fanciful considering the reality of today’s Congress. That we live in a society in which our legislators pass 1,000-bills they have not read and do not understand is beyond question. How to deal with this reality, which has been many years in the making, is a difficult challenge. It is one we would do well to confront.

Allan C. Brownfeld is the author of five books, the latest of which is THE REVOLUTION LOBBY (Council for Inter-American Security). He has been a staff aide to a U.S. Vice President, Members of Congress, and the U.S. Senate Internal Security Subcommittee.
Why is China Hoarding all the Gold? Get this Critical Info for Your IRA or 401(k) >

A CRAZY BITCH AT MY DOCTORS TODAY

THERE WAS SOME OLD PEOPLE SITTING THERE
I ASKED THE ONE OLD MAN HOW DO YOU LIKE OBAMA CARE
HE SAID HE DONT
SO I TOLD HIM TO GET ALL HIS FRIENDS TO CALL THE GOVERNOR AND TELL THEM WE DONT WANT OBAMA CARE
AND OUR GOVERNORS CAN STOP IT THATS WHY OBAMA WENT AFTER RICK PERRY TELLING HIM HE DONT TRUST HIM
THIS CRAZY WHITE HOE BITCH STANDS UP AND STARTS CALLING ME A LIAR
I SAID BITCH I AM RUNNING FOR STATE REP HERE IN PA MY NAME IS ON THE BALLOT FOR MAY
SHE SAID I AM LIEING
I SAID TO THIS NASTY ASS OBAMA LOVER I CALLED HER A OBAMA LOVER
SHE SAID I DONT LOVE OBAMA
I SAID OH YOUR ARE A LIBERL SHE SAID SHE IS NOT
I SAID TO HER HOPE SHE LIKES WHAT OBAMA DID TO OUR NATION
THIS BITCH GETS IN MY FACE AND SAID I GUESS YOPU WATCH FOX NEWS
I SAID NO I GIVE FOX NEWS
MY NEWS MAKES IT ON FOX NEWS
SHE SAID I WAS A CRAZY LADY
SO WHEN SHE WENT INTO SEE THE DR I PRAYED FOR HER
THIS IS MY PRAY HEAVENLY FATHER IN THE NAME OF YOUR SON JESUS CHRIST I BEG YOU THIS DAY TO END HER HEALTH CARE LET HER END UP ON OBAMA CARE
LET HER LOSE HER JOB LOSE HER HOME EVERY THING SENSE THIS EVIL WHORE VOTED FOR OBAMA IN JESUS NAME I PRAY
I WILL NEVER FOR GIVE A OBAMA VOTER LOVER OR SOME DUMB ASS BITCH WHO CALLS ME NAMES WHEN THIS WHORE IS THE REASON WHY OUR NATION IS DESTORY FUCK HER GO TO HELL I WILL NOT PRY FOR 1 PERSON WHO VOTED FOR OBAMA SORRY
I BROKE MY HAND IT IS IB A CASE NO NOT FIGHTING WITH HER I FELL DOWN THE STEPS
LANDED ON MY GOOD HAND SO NOW I HAVE 2 BAD HANDS AND I HAVE A FEVER CANY FIND MY PILLS THEY IS A PRAICE YOU MUST PAY WHEN YOU DAME SOME ONE SO I GUESS I AM PAYING IT
GUESS WHAT I DONT CARE
WHY SHOULD THESE PEOPLE GET OFF FOR DESTORY IN OUR NATION BECAUSE SHE IS A MUSLIM LOVER A COMMIE OR A BABY KILLER FUCK THEM ALL LET THEM ALL BURN ONE THING ABOUT ME IS I DO GIEV MY NEWS TO MEGAN KELLY
BUTT WHO IS THIS EVIL WHORE TO VOTE FOR OBAMA AND CALL ME NAMES
I HOPE THE EVIL ASS WHORE SEES THIS ON THE NET
BUT I WILL BEAT YOU ALL YOUR MONEY SHE WILL BE GOING TO MY DRS TO GET ME TO TAKE THE PRAYER OFF HER
I WILL NEVER I KNOW SHE HEARD ME SHE WENT OUT THE BACK DOOR
I DONT CARE HOW BAD MY HAND IS I DONT CARE
I WILL FIGHT ANY ONE WHO KNOWINGLY DESTORE MY NATION SO THEY CAN GET A FREE CELL PHONE FUCK HER
I PRAY THE MUSLIMS GANG RAPE HER

Evidence U.S. bribed Muslim Brotherhood officials

Evidence U.S. bribed Muslim Brotherhood officials

Document surfaces ahead of criminal trial of ousted leaders

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Official Morsi government document: “Direction of Grants and Gifts for 2013,” submitted by Hamad bin Jasim bin Jabor Al Thani, former Qatari prime minister and foreign affairs minister
A  question apparently being raised in next week’s trial in Cairo of Egyptian Muslim Brotherhood leaders facing criminal charges is this: Was the Obama administration paying bribes as large as $850,000 a year to the Morsi government that were distributed by top ministerial level officials to Muslim Brotherhood leaders, with the direct involvement of the U.S. Embassy in Cairo?
WND is in possession of an official document from inside the Morsi government that lends credibility to a report published in Arabic by an Egyptian newspaper in Cairo that lists the charges brought by the current military-controlled government against Egyptian Muslim Brotherhood leaders.
As seen above, WND has obtained official records from the deposed Morsi government in Egypt, with signatures, documenting monthly “gifts” paid to Muslim Brotherhood leaders in Egypt by the former prime minister and foreign minister of Qatar, Hamad bin Jassim bin Jabor Al Thani.
The document was seized from Egyptian government offices in Cairo when the Morsi government was deposed by the military July 3.
As translated by former PLO member and native Arabic-speaker Walid Shoebat, the monthly “gifts” listed in the document amount to bribes paid by the Morsi government to leading Muslim Brotherhood members in Egypt, including an annual payment of $750,000 to $850,000 in U.S. dollars.
Shoebat explained to WND the names listed on the Egyptian government document correspond to information the Egyptian newspaper Almesryoon has just published in Egypt reporting that the Cairo district attorney’s office has begun investigating alleged bribes the U.S. has paid through its embassy in Cairo to the Muslim Brotherhood.
According to the newspaper: “A judicial source stated that the Attorney General Hisham Barakat received during the past few days a number of filed complaints accusing the leaders of the Muslim Brotherhood and leaders of the centrist party of receiving bribes thinly disguised as ‘gifts’ paid through the U.S. Embassy in Cairo.”
The sources of the complaint stated that among those receiving bribes paid in U.S. dollars from the U.S. include:
  • Mohamed Badie, general guide of the Muslim Brotherhood;
  • Khairat Al-Shater, deputy leader of the Muslim Brotherhood and businessman;
  • Mohamed Beltagy, the deputy head of the Freedom and Justice Party, the Muslim Brotherhood’s political party in Egypt, and the leader of the Muslim Brotherhood group, Essam el-Erian;
  • Abu Ela Mady, head of the Wasat Party; and
  • Essam Sultan, deputy head of the Wasat Party.
“What this document suggests,” Shoebot explained to WND, “is that the report the Egyptian newspaper Almesryoon published in Cairo may be correct in that it appears the U.S. government was paying monthly bribes in U.S. dollars, with payments as large as $85,000 a month, to top Muslim Brotherhood leaders in Egypt, with the money being passed from the United States through the U.S. Embassy in Cairo to the Morsi government.”
Shoebat stressed to WND that the signatures seen in the document mean it could be used as evidence in the upcoming trials of key Muslim Brotherhood leaders, slated to begin Aug. 25 in Cairo.
Shoebat also noted that the names listed in the document match the names in the Egyptian newspaper Almesryoon, including Mohamed Beltagy.
Reading closely the Almesryoon report, Shoebat concluded the document is likely to be among the evidence the current government of Egypt plans to introduce in its prosecution of the Muslim Brotherhood leaders.
The charges being brought in Cairo next week include not only bribes being taken in U.S. dollars from the U.S. Embassy, but also murders and assassinations, prison escapes, sniping at and the indiscriminate killing of demonstrators, and spying or being a double-agent collaborating with foreign governments, including both the U.S. and Qatar.
“The criminal charge being reported against the Muslim Brotherhood leaders in Cairo suggest these are major trials about to start,” Shoebat explained to WND.
“And with government documents entered into evidence, like the one WND is publishing, the criminal charges will likely be construed as capital offenses, with death by hanging the likely sentence.”

EXCLUSIVE: FBI blocked in corruption probe involving Sens. Reid, Lee

EXCLUSIVE: FBI blocked in corruption probe involving Sens. Reid, Lee

Agents quietly working with Utah prosecutors to make case in DOJ absence

'Rocky' on Broadway

Sylvester Stallone attends the broadway premiere of "Rocky: The Musical," where he talked about how he always felt the story would work as a musical. (March 14)
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AIG’s Benmosche Collects $6M as Bonus Beats Target
Senate Majority Leader Harry Reid of Nev., Sen. Mike Lee (R-Utah)Senate Majority Leader Harry Reid of Nev., Sen. Mike Lee (R-Utah)
EXCLUSIVE:
FBI agents working alongside Utah state prosecutors in a wide-ranging corruption investigation have uncovered accusations of wrongdoing by two of the U.S. Senate’s most prominent figures — Majority Leader Harry Reid and rising Republican Sen. Mike Lee — but the Justice Department has thwarted their bid to launch a full federal investigation.


The probe, conducted by one Republican and one Democratic state prosecutor in Utah, has received accusations from an indicted businessman and political donor, interviewed other witnesses and gathered preliminary evidence such as financial records, Congressional Record statements and photographs that corroborate some aspects of the accusations, officials have told The Washington Times and ABC News.
But the Justice Department’s public integrity section — which normally handles corruption cases involving elected figures — rejected FBI agents’ bid to use a federal grand jury and subpoenas to determine whether the accusations are true and whether any federal crimes were committed by state and federal officials.
The information involving Mr. Reid and Mr. Lee is not fully developed but centers on two primary issues:
• Whether both or either politician sought or received money or other benefits from donors and/or fundraisers in connection with doing political favors or taking official actions.
• Whether Mr. Lee provided accurate information when he bought, then sold a Utah home for a big loss to a campaign contributor and federal contractor, leaving his mortgage bank to absorb large losses.
“There are allegations, but they are very serious allegations and they need to be looked at by somebody,” Sim Gill, a Democrat who is the elected chief prosecutor in Salt Lake County, told The Times. “If true, or even if asserted, they truly should be investigated and put to rest, or be confirmed.”


Spokesmen for both senators denied their bosses engaged in any wrongdoing and said the lawmakers were unaware of the investigations.
Mass recusal
The investigative efforts have been further complicated by the fact that Mr. Reid worked to get Mr. Lee’s chief counsel, David Barlow, confirmed in 2011 as the U.S. attorney in Salt Lake City. That action — a Democratic Senate leader letting a Republican be named to a key prosecutor’s position in the Obama administration — raised many eyebrows and angered some Democrats.
Subsequently, the entire office of federal prosecutors in Utah was forced to recuse itself from the corruption case after questions surfaced about a conflict of interest involving one prosecutor and a subject of the probe. After the recusal, state prosecutors secured a court order transferring the federal evidence gathered up to that point to their possession.
The process has left FBI agents in the unusual position of trying to help two local prosecutors make a case in state court without the ability to use the federal court system to determine whether accusations against two powerful members of Congress are true.
“We’re just two local prosecutors but everybody who was supposed to look at this evidence above us has made a decision not to, and by default left it to us to investigate and prosecute at the state level,” Mr. Gill said.
He and his counterpart in the wide-ranging probe, chief Davis County prosecutor Troy Rawlings, praised the FBI agents assisting their case for their dedication to finding the truth.
Story Continues →

How the Kings of Fracking Double-Crossed Their Way to Riches

How the Kings of Fracking Double-Crossed Their Way to Riches

Thanks to a series of shady deals with former subsidiaries—and massive cuts in royalties to unsuspecting landowners—the controversial shale gas firm is now awash in cash.
At the end of 2011, Chesapeake Energy, one of the nation’s biggest oil and gas companies, was teetering on the brink of failure.
Its legendary chief executive officer, Aubrey McClendon, was being pilloried for questionable deals, its stock price was getting hammered and the company needed to raise billions of dollars quickly.
The money could be borrowed, but only on onerous terms. Chesapeake, which had burned money on a lavish steel-and-glass office complex in Oklahoma City even while the selling price for its gas plummeted, already had too much debt.
In the months that followed, Chesapeake executed an adroit escape, raising nearly $5 billion with a previously undisclosed twist: By gouging many rural landowners out of royalty payments they were supposed to receive in exchange for allowing the company to drill for natural gas on their property.
In lawsuits in state after state, private landowners have won cases accusing the companies like Chesapeake of stiffing them on royalties they were due. Federal investigators have repeatedly identified underpayments of royalties for drilling on federal lands, including a case in which Chesapeake was fined $765,000 for “knowing or willful submission of inaccurate information” last year.
Last month, Pennsylvania governor Tom Corbett, who is seeking reelection, sent a letter to Chesapeake’s CEO saying the company’s expense billing “defies logic” and called for the state Attorney General to open an investigation.
McClendon, a swashbuckling executive and fracking pioneer, was ultimately pushed out of his job. But the impact of the financial maneuvers that he made to save the company will reverberate for years. The winners, aside from Chesapeake, were a competing oil company and a New York private equity firm that fronted much of the money in exchange for promises of double-digit returns for the next two decades.
The losers were landowners in Pennsylvania and elsewhere who leased their land to Chesapeake and saw their hopes of cashing in on the gas-drilling boom vanish without explanation.
People like Joe Drake.
Chesapeake cut Joe Drake’s royalty payments by about 90 percent, without explanation. ‘If you or I did that we’d be in jail,’ he said.
“I got the check out of the mail… I saw what the gross was,” said Drake, a third-generation Pennsylvania farmer whose monthly royalty payments for the same amount of gas plummeted from $5,300 in July 2012 to $541 last February. This sort of precipitous drop can reflect gyrations in the  price of gas. But in this case, Drake’s shrinking check resulted from a corporate decision by Chesapeake to radically reinterpret the terms of the deal it had struck to drill on his land. “If you or I did that we’d be in jail,” Drake said.
Chesapeake’s conduct is part of a larger national pattern in which many giant energy companies have maneuvered to pay as little as possible to the owners of the land they drill. Last year, a ProPublica investigation found that Pennsylvania landowners were paying ever-higher fees to companies for transporting their gas to market, and that Chesapeake was charging more than other companies in the region. The question was “why”?
ProPublica pieced together the story of how Chesapeake shifted borrowing costs to landowners from documents filed with the U.S. Securities and Exchange Commission, interviews with landowners, people who worked for the company and employees at other oil and gas concerns.
The deals took advantage of a simple economic principle: Monopoly power.
Boiled down to basics, they worked like this: When energy companies lease land above the shale rock that contains natural gas, they typically agree to pay the owner the market price for any gas they find, minus certain expenses.
Federal rules limit the tolls that can be charged on inter-state pipelines to prevent gouging. But drilling companies like Chesapeake can levy any fees they want for moving gas through local pipelines, known in the industry as gathering lines, that link backwoods wells to the nation’s interstate pipelines. Property owners have no alternative but to pay up. There’s no other practical way to transport natural gas to market.
Chesapeake took full advantage of this. In a series of deals, it sold off the network of local pipelines it had built in Pennsylvania, Ohio, Louisiana, Texas and the Midwest to a newly formed company that had evolved out of Chesapeake itself, raising $4.76 billion in cash.
In exchange, Chesapeake promised the new company, Access Midstream, that it would send much of the gas it discovered for at least the next decade through those pipes. Chesapeake pledged to pay Access enough in fees to repay the $5 billion plus a 15 percent return on its pipelines.
That much profit was possible only if Access charged Chesapeake significantly more for its services. And that’s exactly what appears to have happened: While the precise details of Access’ pricing remains private, immediately after the transactions Access reported to the SEC that it collected more money to move each unit of gas, while Chesapeake reports that it also paid more to have that gas moved. Access said that gathering fees are its predominant source of income, and that Chesapeake accounts for 84 percent of the company’s business.
What’s more, SEC documents show, Chesapeake retained a stake in the gathering process. While Chesapeake collected fees from landowners like Drake to cover the costs of what it paid Access to move the gas, Access in turn paid Chesapeake for equipment it used to complete that process, circulating at least a portion of the money back to Chesapeake.
ProPublica repeatedly sought comment and explanations from both Chesapeake and Access Midstream over the course of several months. Both companies declined to make executives available to discuss the deals or to respond to written questions submitted by ProPublica.
Days after the last of the deals closed, Drake and other landowners learned the expense of sending their gas through Access’s pipelines would eat up nearly all of the money they had been previously earning from their wells. Some saw their monthly checks fall by as much as 94 percent.
An executive at a rival company who reviewed the deal at ProPublica’s request said it looked like Chesapeake had found a way to make the landowners pay the principal and interest on what amounts to a multi-billion loan to the company from Access Midstream.
 “They were trying to figure out any way to raise money and keep their company alive,” said the executive, who declined to be named because it would jeopardize his dealings with Chesapeake. “I think they looked at it as an opportunity to effectively get disguised financing…that is going to be repaid at a premium.”
***
At 54, Joe Drake guns his six-wheeler up a steep rock-rutted trail on the backwoods of his 494-acre tract and points to his property line, marked by a large maple in a sea of indistinguishable trees. He knows where it lies, because as a kid his father made him walk that line to string barbed wire. The wire is long gone, but a rusted snag remains entombed in the bark. Back then, the Drakes ran a dairy farm in these pastures.
“It’s just something you’ve got in your blood that you do,” Drake said. “But dairy farmers are a dying breed… It was a good way of life.”
Today, the milking stalls have been ripped out of a long barn that still carries the stench of their manure, but stores 20-foot stacks of bailed hay instead. Drake sold all 187 head of cattle two years ago, pinched by regulated milk prices and the rising costs of independent farming. He took out a second mortgage to keep the farm afloat.
140312-propublica-fracking-farm-embed1
Joe Drake, in his kitchen in Bradford County, Pennsylvania, with a stack of royalty statements from Chesapeake Energy. (Abrahm Lustgarten/ProPublica)
Across the road, past his house and just beyond a stand of Oak and Ash, the hillside’s natural shape transitions to a steep slope of pushed dirt, capped by a 7-acre flat the size of a large gravel parking lot. In the middle stands a 6-foot stack of steel pipes and valves—a gas well.
When Chesapeake arrived at Drake’s door, he was optimistic. Drake plastered a “Drill, baby, drill” bumper sticker in the window of his Ford F-250 pickup. He welcomed the chance to draw an easy income from his land, and was unswayed when his neighbors raised questions about the environmental risks of drilling. Chesapeake promised Drake one-eighth the value of whatever it made from his well.  It seemed like a fair deal.
If any driller was going to make money for Drake, he thought, it would be Chesapeake. The company had built an empire off finding and drilling natural gas discoveries as the fracking boom rolled across the country. With uncanny foresight, its founder, McClendon, locked up exclusive access to immense tracts of land across the country by promising property owners that their lives would be transformed by the wealth the gas under it would bring.
Then the company drilled furiously—in Oklahoma, then Texas, Louisiana and later in Pennsylvania’s Marcellus Shale—catapulting itself to the rank of second-largest producer of natural gas in the United States. It made McClendon—who snatched up a stake in the Oklahoma City Thunder basketball team and moved into a stone mansion in the posh Oklahoma City suburb of Nichols Hills—one of the richest men in the world.
McClendon—named by Forbes in 2011 as “America’s Most Reckless Billionaire”—would find his way into plenty of personal trouble. He took a personal stake in Chesapeake’s wells, and then liquidated his stock in the company in order to cover his own losses, rattling investors and ringing corporate governance alarm bells. He drew scrutiny for selling his $12 million antique map collection to the company and ire for taking a $75 million bonus as Chesapeake struggled.
In 2012, he borrowed as much as a billion dollars from the company’s private equity partners to fund his private interests. Separately, an investigation by Reuters alleged Chesapeake had rigged land leasing prices in Michigan, under McClendon’s direction, sparking a federal criminal probe.
“They pass the buck, they tell you to call this person, and you are lucky if you can even get an answering machine.”
But McClendon’s overarching design for the business nonetheless made it a formidable player. Chesapeake aggressively pursued business opportunities beyond its drilling. It created interlocking businesses and took advantage of tax breaks that deliver out-sized benefits to energy companies.
By structuring itself this way, Chesapeake earned a slice of profit from each step. Chesapeake’s subsidiaries trucked the drilling materials, drilled the wells, fracked the gas, gathered and piped it away to a hub, and then marketed the end product—what economists call vertical integration. In fact, he built Chesapeake into a powerhouse, an echo of the old Standard Oil empire, positioned to control almost every variable and armed with the leverage to get its way.
Neither McClendon nor his staff responded to requests for comment for this article.
From early on, the company viewed the local pipelines as a profit source. Chesapeake formed subsidiaries to build and run the lines, then spun them off into a separate, publicly traded company. That company would eventually evolve into Access Midstream, when Chesapeake sold its shares—one of the three deals—for $2 billion in 2012.
The strategy paid dividends. At Chesapeake’s headquarters, a group of new, distinctively-designed office buildings went up, with views south over the state capital and the city’s small skyline. The company lavished its employees with perks, too. “They’ve got a 72,000-square-foot gym, free trainers… free Thunder tickets,” said Andrea Watiker, who scheduled pipeline capacity for gas traders in one of the company’s new towers.
Confident he was in good hands, Drake endured the trucks, dirt and noise that accompanied gas drilling and signed agreements that allowed Chesapeake to run pipelines across his fields. To transport the gas from Drake’s well, Chesapeake built a pipeline that stretched south from within spitting distance of the New York border, cutting a wide swath through the forest. Then it went down beyond the white-spired church in Litchfield, and ran some 35 miles further to its handoff at the Tennessee interstate pipeline near the Susquehanna River.
What Drake didn’t know at the time was that the pipeline was more than a way to move his gas to market. It would become part of a strategy to make more money off of Drake himself.
***
When the first gas flowed from the well on Drake’s land in July 2012, it was abundant, and the royalty checks were fat. “We was hoping to get these loans paid off…with the big money,” said Drake, who earned more than $59,400 from the first few months of production, referring to the mortgages on his farm.
That year, many Pennsylvania landowners began receiving similarly sized payments as thousands of new wells—many of them drilled by Chesapeake—finally began producing gas. Pennsylvania fast approached Texas as the largest source of natural gas in the country, and with it, the prosperity long promised to this rural part of the United States seemed about to arrive.
But then, in January 2013, without warning or explanation, the expenses withheld from Chesapeake’s royalty checks for use of the gathering pipelines tripled. Drake’s income dwindled. His contract with Chesapeake—and Pennsylvania law that sets a minimum royalty share in the state—promised him at least 12.5 percent of the value of the gas. Drake says the company led him to believe any expenses would be negligible. “Well, they lied.”
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Joe Drake, with his dogs Bently and Blue, overlooking Chesapeake’s Drake 2H gas well pad on his property in Bradford County, Pennsylvania. (Abrahm Lustgarten/ProPublica)
A few miles away, the same month, his brother-in-law had 94 percent of his gas income withheld to pay for what Chesapeake called “gathering fees.” Others across the northern part of the state also saw their income slashed. “I’ve got a stack,” said Taunya Rosenbloom, a lawyer representing Pennsylvania landowners with natural gas leases. She pulled the statements of all of her Chesapeake clients into an eight-inch pile on her desk. “Everyone is having this issue.”
Drake found the statements Chesapeake mailed him each month mystifying. He pored over the papers, hired a lawyer, compared notes with his neighbors, but couldn’t make sense of the charges.
Other Pennsylvanians were similarly baffled. Sometimes, Chesapeake charged different fees to neighbors whose wells fed into the same gathering line. Other times, companies that had partnered with Chesapeake on the same well charged vastly less for expenses. No one at the Chesapeake could seem to explain how the charges were set.
“There is no rhyme or reason why one client would have such an exorbitant amount taken out when another no more than 3 miles away has only 20 percent of their royalty taken,” said Harold Moyer, an accountant in Bradford County, Pa., who represents more than 150 landowners with royalty rights. Moyer said he saw a dramatic difference between what Chesapeake usually charged compared to other energy companies in the area.
Different contracts may entitle Chesapeake to charge varying amounts. Some of the leases examined by ProPublica limit a landowner’s share of expenses to 12.5 percent—or the same as their share of the proceeds. Other contracts prohibit Chesapeake from withholding any expenses at all. Drake’s contract appears to allow Chesapeake to recoup as much money as it wants; it stipulates that he can be charged for the expense of gathering and transporting his gas without specifying his share of such expenses.
Gas drillers differ significantly in how much they charge landowners for expenses. The Norwegian energy company Statoil owns a portion of the gas extracted from Drake’s well, as well as a portion of the gathering line that moves the gas to an interstate pipeline. Yet Statoil rakes off virtually nothing for its expenses, according to its statements. Statoil told ProPublica that it sells its gas independently and makes decisions about billing separately from Chesapeake.
“Something is wrong with Chesapeake’s calculation… It can’t be.”
“When it comes to deciding which, if any, deductions are appropriate, we make that assessment according to the terms of each lease and the applicable laws,” wrote Ola Morten Aanestad, in an e-mailed response to questions.
Drake peers out the window, over the hills that descend from his porch into a valley brightening with the changing colors of fall, and scowls. He can’t stand being indoors. He’s worried that he’ll spend most of next hunting season here at this table, trying to decipher Chesapeake’s statements. His monthly gas statements pile up, unorganized, on the kitchen table, below a rack of deer antlers and beside two empty cans of Coors Light and a camouflage baseball cap.
Drake’s gathering pipeline only extends a few dozen miles, far less distance than the interstate pipeline it feeds into that carries his gas through New Jersey towards White Plains, NY. Yet public documents filed with the Federal Energy Regulatory Commission show it only cost about $.38—on average—to move a unit of gas on the interstate system—a fraction of the $2.94 Chesapeake charged Drake to move a unit of gas a vastly shorter distance that February.
“Nobody can tell you why or how come,” Drake said. “They pass the buck, they tell you to call this person, and you are lucky if you can even get an answering machine.”
Chesapeake declined to explain its charges to Drake or to ProPublica. When a ProPublica reporter visited Chesapeake’s headquarters in Oklahoma City, the company’s director of external communications sent a message that he was “booked solid” and couldn’t talk.
***
There has long been dispute over how drilling companies calculate royalty payments due landowners.
A 2007 report commissioned from a forensic oil and gas accountant by the National Association of Royalty Owners (NARO) — an organization representing landowners in their dealings with the oil and gas industry—found that almost every company it examined had “used affiliates and subsidiaries to reduce income to royalty owners and taxing authorities.”
140312-propublica-fracking-farm-embed3
Joe Drake expected to pay off his mortgages by allowing Chesapeake Energy to drill at this gas well site on his farm in Bradford County, Pennsylvania. Instead, the company is withholding more than 90% of his payments to cover expenses. (Abrahm Lustgarten/ProPublica)
Nine out of 10 of the top producers in Colorado, Texas, Arkansas and Oklahoma—including ConocoPhillips, Chevron, BP and Chesapeake—had used subsidiaries to sell their gas for significantly more than the amount they reported to landowners, according to the report. They inflated their expenses, too—at least according to the six companies that provided that level of detail for the report—charging landowners, on average, 43 percent more than what they actually paid to handle the gas. (Neither Chevron nor Chesapeake provided information about their expense deductions.)
ConocoPhillips and BP declined to comment for this article. Chevron did not respond to a request for comment.
Other companies have been ensnared in similar controversies. The giant pipeline company, Kinder Morgan, which also declined to speak to ProPublica, has been accused by Montezuma County, Colo., of overstating its transportation and other expenses, and underpaying $2 million in taxes as a result. (Kinder Morgan has paid that bill, but is appealing the decision.) Chevron has faced multiple lawsuits for underpaying royalties and overstating expense deductions because of alleged self-dealing through its affiliate relationships, including a 2009 case the company settled with the U.S. Department of Justice for $45 million.
“Every company has been involved,” said Jeffrey Matthews, a vice president and forensic accounting expert at Charles River Associates, a consulting firm, in a lecture to landowners and oil and gas industry accountants in Houston. “If you’re dealing with related parties,” the technical term for the sort of inter-locking subsidiaries created by Chesapeake, “the costs can be double, or triple. You don’t know if you are paying for something two to three times over.”
Even so, Chesapeake stands out among its peers and is widely known to interpret contracts to match its strategies, executives in the oil and gas industry say.
The company has faced numerous lawsuits—filed by the billionaire Ed Bass, and the city of Fort Worth, among others—claiming it misrepresented its expenses. Chesapeake has paid hundreds of millions of dollars in settlements and judgments in such cases, including a $7.5 million settlement with Pennsylvania landowners last fall.
One Oklahoma lawsuit, brought by other oil companies that had partnered with Chesapeake, alleged that Chesapeake cheated them out of the final sales price of their gas and artificially inflated its operating expenses, in part by folding in the salaries of high-level management, the cost of seminars they attended, and rent and office expenses for field offices. The suit was settled in late 2004 for $6.5 million. Chesapeake denied any wrongdoing, and the settlement explicitly states that Chesapeake did not agree to “change the practices complained of” in the lawsuit.
“They were making excessive, unwarranted, and unauthorized charges,” said Charles Watson, an Oklahoma attorney involved in the case. “I don’t think it’s mistaken interpretation, I think it’s an intentional accounting maneuver to reduce the amount of money going to the royalty owners and increase the amount of money going to the operator.”
Chesapeake declined to comment about the case.
For Drake to know how Chesapeake calculated his gathering costs, he has to pay lawyers and accountants to audit the company, or take his grievance to arbitration, a process that would cost him tens of thousands of dollars. In either case, he would need to see the purchase agreements that describe the company’s gas sales in detail. They list far more precisely than Drake’s own statements exactly what costs were incurred, how much gas might have been lost along the way or used by the company for its own purposes, what marketing fees Chesapeake’s subsidiary charged, and the final, real price of the gas.
But Chesapeake isn’t required to share these agreements. They are proprietary.
“When it comes to production expense,” said Charles River’s Matthews, “you’re at their mercy.”
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The deals that led to much higher expense charges for Drake and his neighbors involve some sophisticated financial engineering.
Over 12 months, Chesapeake sold off a significant portion of its nationwide system of gathering pipelines in three separate transactions. By December 2012, almost all of the pipes were controlled by a single company—Chesapeake’s former affiliate, Access Midstream. Taken together, the sales brought $4.76 billion in cash into Chesapeake’s coffers.
The reason behind the moves was simple: All that profligate spending—the Oklahoma City offices, corporate jets and huge executive salaries—had come at roughly the same time that the price of gas tumbled to historic lows, analysts at several Wall Street investment firms told ProPublica. Chesapeake “desperately needed cash,” observed Tony Say, who once headed Chesapeake’s Marketing division—the same part of the company that now handles transportation for the gas.
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A gas drilling rig operating in norther Bradford County, Pennslyvania, outside the town of Sayre, with New York State in the background. (Abrahm Lustgarten/ProPublica)
In its securities filings, Chesapeake said that the deals brought the company $1.76 billion more than it had invested to build and maintain its pipelines and the companies that ran them, leaving the impression that the sales were an unqualified boon for Chesapeake.
But a look at an SEC filing by Access Midstream tells a different story: Chesapeake was going to have to give much of that money back.
On the same day as the last of the major sales, Chesapeake signed long-term contracts pledging to pay Access a minimum fee for transporting its gas. In some cases, the fee held no matter what happened to the price of gas, or even how little of it flowed out of Chesapeake’s wells.
Chesapeake also promised to connect every new well it drilled to Access’s lines for the next 15 years in Ohio’s Utica Shale, a potentially lucrative emerging drilling field, and made similar agreements elsewhere.
According to ProPublica projections based on figures disclosed by the companies in late 2013, Chesapeake’s commitments would have it paying Access a whopping $800 million each year. Over ten years, the contracts would generate nearly twice as much money as Access had paid Chesapeake for its businesses in the first place.
In plain words, Chesapeake and a company made up of its old subsidiaries were passing money back-and-forth between each other, in a deal that added little productive capacity but allowed both sides of the transaction to rake in billions of dollars.
Access’ chief executive, J. Mike Stice, told a group of investment banking analysts last September that the deals amounted to a ”low-risk business model” that “most people haven’t understood.”
“Nobody really has the access to contractual growth that [Access Midstream] has,” Stice said. “It doesn’t get any better than this.”
The SEC filings provide other detail about the ways that the two companies devised to remain inextricably linked, even though Chesapeake has sold the stake it once had in Access.
At the same time it signed its contracts, Access pledged to subcontract a slice of its business back—again—to companies still owned by Chesapeake. It also agreed to buy industrial equipment used to compress the gas for the pipelines from a company owned by Chesapeake. In essence, Chesapeake would get a rebate on the fees it had guaranteed to Access. Chesapeake never answered questions about whether that rebate was figured in to the price it charged Joe Drake and his neighbors.
In its royalty statements to Joe Drake, Chesapeake says the expenses it had has deducted reflect what it costs the company to move his gas. The company has said in public statements about the royalty disagreements in Pennsylvania that it is merely recouping its costs.
But ProPublica’s projections drawn from figures previously reported by both companies show that Chesapeake could earn back billions of dollars of the transportation fees it is paying Access over the next 10 years.
There are other ties between the two companies. Access’s Chief Executive, Stice, once worked for McClendon as the chief operating officer of one of the companies that used to run the pipelines. Chesapeake’s chief financial officer, Dominic del Osso, sits on the board of Access Midstream Partners, and as of 2011, according to SEC records, owned thousands of shares of Access stock.
The relationships raise questions about Chesapeake’s assertions that its contracts are arm’s-length agreements, and that its expenses reflect its true cost of operating.
“They had a lot of disguised debt,” said Philip Weiss, a chief investment analyst with Baltimore Washington Financial Advisors, who has covered Chesapeake over the years, and was often concerned that the company has understated its financial obligations. In this case, he said, Chesapeake’s expensive contracts with Access might not just be the cost of operating, but another unusual long-term financial obligation that would weigh down the company, but which wouldn’t be reflected in the normal measures of debt. “The use of off-balance-sheet debt is often a way to try to avoid getting as much investor scrutiny.”
For six months Chesapeake declined to answer questions about these discrepancies posed by ProPublica. But in its latest annual financial filings made public just two weeks ago, Chesapeake noted for the first time that it had $36 billion worth of what it called “off-balance-sheet arrangements,” including $17 billion of long-term commitments to buy gathering services. This appears to be the first time the company has acknowledged that it owes more money than what has been identified as debts in previous SEC filings.
In the filings, Chesapeake said that the $17 billion figure didn’t include reimbursement from royalty owners, and that landowners and corporate partners alike “where appropriate, will be responsible for their proportionate share of these costs.”
In an earlier, September 2013 quarterly filing, there were hints of the same activity, but with no disclosure of the salient details to shareholders that might help them understand what was really going on. Chesapeake reported that its expenses related to its pipeline and marketing business roughly doubled in the months after it sold its pipelines, compared to the same period a year earlier, and that its revenues for that part of its business also increased accordingly, covering the new costs. Chesapeake told investors it had cost the company more than $8 to transport a cubic foot of gas or its oil equivalent—an astronomical amount unheard of in the energy industry.
“Something is wrong with this calculation,” said Fadel Gheit, a seasoned industry analyst for the investment firm Oppenheimer, who estimated the figure was off by a decimal point before later confirming that it matched the numbers Chesapeake had reported to the SEC. “It can’t be.”
In fact, none of the financial analysts who cover Chesapeake that ProPublica spoke with could explain the explosion in Chesapeake’s marketing and transportation revenues and expenses using oil sales alone.
“The change in marketing, gathering, compression revenue and expense is staggering,” wrote Kevin Kaiser, a financial analyst with Hedgeye, a private equity group in New York, in an email to ProPublica.
Neither Chesapeake’s investor relations group, nor its media staff would comment on whether the deals amounted to disguised debt that landowners would repay. In interviews, one former Chesapeake employee with knowledge of the company’s operations dismissed the notion that Chesapeake was essentially paying back an off-balance-sheet loan by paying unusually high fees for use of the pipelines.
“The timing supports that—that Chesapeake got paid a lot of money and the gathering fees get paid back over time, and it looks like a loan arrangement,” said the former employee. “But to jump to the conclusion that the whole thing is a sham and a means by which they are going to defraud royalty owners is not true.”
Only in its latest filing at the end of February, after months of queries from ProPublica, did Chesapeake add a note—two sentences in 299 pages—stating that its contracts with Access and other companies played into the rising figures. But the company did not specify how much.
And to the extent that the real costs of gathering and transporting gas can be gleaned from securities reports and Joe Drake’s own statements, there’s still a big gap between what Chesapeake reports it paid out, and what Access reports it received for gathering services.
In the mean time, one thing is for sure: all the escalating costs, side deals, and unexplained debt aside, Access is making more money than ever, while Chesapeake—so recently fighting to stay alive—has emerged from its troubles and is turning a profit.
Joe Drake, on the other hand, is almost back to where he began.
He recently cancelled a fishing trip to Canada and doubled back on the question of how to make a living from the farm. With his livestock gone he will now focus on growing and bundling hay, which he will sell to other farms so they can feed their animals. The natural gas boom has become little more than a sideshow.
“We are surviving,” he said. “But we learned that a good old handshake don’t cut it anymore.”
Abrahm Lustgarten is a reporter for ProPublica, a nonprofit newsroom that publishes investigative journalism.