ACOEM’s Newest Bad Position in the War for Public Health & Safety

Merely sunsetting the ACOEM Mold Position Statement does not rectify the diminished quality of life that is still occurring for many, and is resultant from the years of fraud in medical policy and courts over the mold issue.
by Sharon Noonan Kramer
About a week ago, I posted a blog on Katy’s Exposure entitled “ACOEM Mold Statement ~ Ding, Dong! The Witch is DEAD!”.  The blog was regarding the American College of Occupational and Environmental Medicine (ACOEM) finally removing the scientifically void “Adverse Human Health Effects of Mold in the Indoor Environment” as a position statement on the public affairs page. The gist of the blog was of the positive impact that sunsetting this horrid position paper should have on public health policies and toxic tort litigations nationwide.
ACOEM no longer portraying this paper as an “Evidence based statement” and as the medical understanding of thousands of learned physicians, should aid to cause America’s physicians to be better informed to the reality of disabling and sometimes deadly Chronic Inflammatory Response Syndrome from exposure to biocontaminants found in Water Damaged Buildings (CIRS WDB). (that one is always a mouthful to write. read it again if you don’t get it!)
Commonly referred to as the “ACOEM Mold Statement”, it was always known to be controversial. It was penned by prolific expert defense witnesses in mold litigation and crammed through ACOEM’s peer review process while being referred to as a “litigation defense argument”.  (See multiple ACOEM emails from the 2002 peer review process in the 2007 Wall Street Journal article linked below).
Again, the primary problem lays with the fact that two PhDs, Bruce Kelman and Bryan Hardin of Veritox, Inc., have repeatedly professed in court that they proved mycotoxins in an indoor environment could never reach a level to harm — as they used the ACOEM Mold Statement that they wrote –to legitimize their scientific fraud upon U.S. courts.  The false concept was mass marketed into policy by many affiliated with ACOEM and by medical schools around the country, that the Veritox associates’ bogus findings meant no amount of biocontaminants indoors (not just mycotoxins) could ever reach a level to cause CIRS-WDB.
In other words, based on scientific fraud, many sick and injured people were deemed to be liars about what caused their injuries, in many U.S. courts for now well over a decade.  In the accurate words of Dr. Harriet Ammann when quoted by the Wall Street Journal in January of 2007,
They [Kelman and Hardin] took hypothetical exposure and hypothetical toxicity and jumped to the conclusion there is nothing there.” 
Equally accurate and in the words of Dr. James Craner in the same article that was written over eight years ago,
“a lot people with legitimate environmental health problems are losing their homes and their jobs because of legal decisions based on this so-called ‘evidence-based’ statement.”
So…last week after I blogged about the ACOEM Mold Position Statement finally being sunsetted — which is basically the same thing as retracting it as purported current scientific understanding of thousands of ACOEM physicians — I received an email from a dear friend of mine, Mrs. Heather Plude.
Heather wrote,
“It is gone off their website, and that’s a good first step. I don’t think them taking this down without putting a new policy up does what you state here: “it marks the end to fraudulent public health policy via false proof of lack of causation of illness from exposure to biocontaminants in water damaged buildings.” I did a search for “Adverse Human Health Effects Associated with Molds in the Indoor Environment” — and came up with this: http://www.ncbi.nlm.nih.gov/pubmed/12762072  Which is still damaging to people who are sick because it states: Current scientific evidence does not support the proposition that human health has been adversely affected by inhaled mycotoxins in home, school, or office environments. We need a public admission of the causation of illness from exposure. Not merely the sudden disappearance of a document that has been denying causation for more than a decade. Again. It’s a good first step… but a lot of damage has been done. Thank you for all you do, Sharon!”
Heather Plude is a smart and staunch advocate for those who have been injured by biocontaminants in water damaged buildings. She has helped many people find their way toward better health through natural remedies.  Upon reading her comment, it occurred to me that if Heather doesn’t understand why the sunsetting of the ACOEM Mold Statement will aid science to advance more freely, then there is a good chance that 99.9% of people do not understand either.
As Heather writes, its true that one can still find the medical journal 2003 version (not the 2002 position statement version) “Adverse Human Health Effects Associated with Molds in the Indoor Environment” Hardin BD, Kelman BJ, Saxon A.” on the National Institute of Health website. But the 2003 version is not now, nor was it ever published in ACOEM’s medical journal, the Journal of Occupational and Environmental Medicine, as the Position Statement of the medical association.  It’s just a paper by three guys who went to college somewhere — now known to NOT BE current accepted science by any medical org.
With the sunsetting of the 2002 position statement version, the 2003 medical journal version carries no more weight when shaping policy and in court than any other medical journal publication.  In fact, this 2003 paper is now subject to even greater scrutiny in the courts because its concept of promoting that its proven indoor mycotoxins can’t harm, has been deemed by ACOEM as not to be the current accepted science of the occupational physician community.  THAT is why sunsetting their scientific nonsense as a position statement is so important to the future of many people.
Plainly stated the 2003 “Adverse Human Health Effects Associated with Molds in the Indoor Environment” on the NIH website by Kelman, Hardin and Saxon, is now just an old, debunked, medical journal publication with the same amount of credibility as a recent medical journal publication by Maggie Simpson and Edna Krabapple. (or maybe even less!)
So now, many questions remain of what will occur to correct the damage from the fraud.  
Now that ACOEM has acknowledged that its NOT current accepted science that its proven mycotoxins in the indoor environment could never reach a level to harm, will there be any restitution for all of those harmed in the past thirteen years by their promotion it was proven that systemic, chronic illness isn’t caused by indoor mold and toxins?
Will court cases which were lost by the sick based on the ACOEM Mold Statement, now be reversed or subject to review/retrial?
Will people who spent all their money trying to find viable medical treatment — only to be told by physicians that mold wasn’t harming them, based on the ACOEM Mold Statement, be reimbursed?
What about all of those who lost their workman’s compensation benefits based on the now known false science?  Any restitution for them? How about the taxpayers who funded life’s necessities of the defrauded workers via social services programs?
Will the U.S. Chamber of Commerce Institute for Legal Reform and the Manhattan Institute Center for Legal Policy be held accountable for paying Hardin and Kelman in 2003 no less than $25K, to publish that their phoney-baloney science proved:
“Thus the notion toxic mold is an insidious secret killer” is only being claimed because of “trial lawyers, media and Junk Science”?
(You all do know, don’t you, that the dynamic duo also forged the name of UCLA physician, Andrew Saxon, as a co-author on this paper for the Chamber, “A Scientific View of the Health Effects of Mold“?  The Chamber sunset their’s a long time ago.)
What about the American Academy of Allergy, Asthma and Immunology (AAAAI)?  Will they be held accountable for all the harm done by leaving their mold position statement up on their website as valid science for five years — while knowing that it also had forged authorship and was based on the fraud of ACOEM’s? (Listed co-author Dr. Jay Portnoy stated under oath that he did not write the AAAAI Mold Position Statement. It was sunset in 2011).
Or how about the Regents of University of California for accepting NIOSH money to teach the fraud in the ACOEM Mold Statement to UC physicians?  Double-whammy and in violation of the California Constitution, they also did nothing to protect the UC name when made aware the UC name was forged for money by Kelman and Hardin on the US Chamber’s Mold Statement.  The Regents  also have made money off the fraud for years. They’ve kept over half of the income generated by UC physicians testifying for the defense while citing the Veritox/ACOEM nonsense as legit science in court.  What will the Regents do to correct fraud in higher education with the use of federal funds while profiting from aiding workers comp fraud?
Will Dr. Elana Page and Dr. Doug Trout of NIOSH be made to issue an apology for using the CDC NIOSH to aid Veritox and other defense witnesses in mass marketing it was proven indoor mold toxins do not harm? (Of worthy note, Page just published a new paper stating that urine tests can’t prove indoor mycotoxins harm. Don’t know if she’s right on the science of this one, but sure seems a little fishy on timing that this newest writing coincidentally was published at the same time the now debunked ACOEM Mold Statement that she supported for years, was being withdrawn.)

Will Bruce Kelman, Bryan Hardin and the other owners of Veritox, be forced to pay restitution to the victims of their known fraudulent expert witness testimonies? (I’ve got the transcripts. They had the audacity to state under oath in multiple cases that they had proven illness from indoor mold toxins “Could not be”)

 
Or how about the U.S. Department of Justice, who continued to hire Veritox as expert defense witnesses in federal mold cases, long after the USDOJ attorneys were aware of the all the fraud over the matter?  Will they be paying anyone for the damages — Or better yet, will they be prosecuting anyone for this massive public fleecing by collusive criminal means?
What about any ACOEM Board of Directors who are also consultants for Veritox? What liability do they have for allowing this public fleecing to continue for so long before sunsetting the known problematic position statement?
Or how about the deceptive idiots at Global Indoor Health Network (GIHN)?  In 2012, while trying to fight fraud with fraud, they put out a Position Statement saying that it was proven half the world’s illnesses were caused by poor indoor air quality. This gem was based solely on their quoting the flawed title of a short news article out of Africa.  When caught in the act of promoting scientific fraud, they attempted to tell their members that the primary theme of their position paper was because of a mere typo. Doh! People injured by poor indoor air quality started quoting the outrageously false statistic while discrediting themselves before any defense witness or naysaying physician had to say a word!
And last but certainly not least in my mind, will California court officers who committed criminal acts under the color of law while knowing their courts had no subject matter jurisdiction; be made to pay me, personally, for harassing me via abuse of their courts, for over 10 years? The direct evidence proves several of them, including appellate justices, committed multiple criminal acts of mailing fraudulent legal documents, coram non judice, to aid Veritox, et.al. to continue to harm thousands via fraud upon the court in Strategic Litigation Against Public Participation (SLAPP).
WHO is going to be punished for these many and massive wrongs, so that collusion to defraud the United States public is discouraged from occurring in U.S. medical policy and in U.S. courts, in the future?
Merely sunsetting the ACOEM Mold Position Statement does not rectify the diminished quality of life that is still occurring for many, and is resultant from the years of fraud in medical policy and courts over the mold issue. 
WHO will be paying for the damage to the public, workers and their legitimate advocates and whistleblowers now that ACOEM has finally acknowledged that they know that what they have been selling over the mold issue for now well over a decade,  is JUNK SCIENCE?  WHO?
Is this a matter that warrants an OSHA investigation? And if so, will they?  NBC News, San Francisco, February 24, 2015 “OSHA Whistleblower Investigator Blows Whistle on Own Agency
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ACOEM Mold Statement ~ Ding, Dong! The Wicked Witch is DEAD!

by Sharon Noonan Kramer
In late October of 2014, I received a message which stated that Marianne Dreger, Publications Director for the American College of Occupational and Environmental Medicine (ACOEM), had told an ACOEM board member that the ACOEM position statement on mold would be sunsetted and removed from ACOEM’s website in early 2015. Many times since the first of the year, I have checked ACOEM’s website to see if the information I received of Ms. Dreger’s statement was correct.
Early this week, I checked the site once again.  Much to my delight, it was true!  The ACOEM mold position statement, “Adverse Human Health Effects Associated with Molds in the Indoor Environment” no longer appears on ACOEM’s position statement and guidance page.  No denotation of its sunsetting anywhere on the site.  No announcement made to ACOEM’s occupational and environmental physician members.  Just Poof!  Quietly gone like it never existed!
So why is this vastly important to the future health and safety of countless Americans and why it is important that the public, physicians and policy setters know of this sunsetting?  Because it marks the end to fraudulent public health policy via false proof of lack of causation of illness from exposure to biocontaminants in water damaged buildings.
Background:
In 2002, three expert defense witnesses in mold litigation were specifically brought into ACOEM to write their mold position statement.  The scientific fraud that was then promoted into policy by the mass-marketing of the bogus position paper, was that two of the three ACOEM paper’s authors, Bruce J. Kelman and Bryan D. Hardin, had scientifically proven mycotoxins could never reach a level indoors to harm anyone.
Flying in the face of the basic tenets of toxicology, the duo claimed to have proven lack of causation by simply applying math extrapolations to data taken from one rodent study of mold. The two fraudsters are co-owners of Veritox, Inc. and are prolific toxic tort expert defense witnesses throughout the United States. Among their many clients is the U.S. Department of Justice.  Hardin is a retired Deputy Director of the CDC’s National Institute of Occupational Safety and Health (NIOSH).  (See January 2007 Wall Street Journal for greater detail)
The fraud in the ACOEM mold statement becoming U.S. medical policy in 2002, and remaining policy for over twelve years has aided many an insurer, employer, landlord, builder, property manager and property seller to escape liability for causation of severe illness and even deaths. Thousands of lives have been devastated by the false concept that it is proven biotoxins in water damaged buildings could not have harmed them.
It is easily billions of dollars of wasted medical testings and treatments that attempt to treat while naysaying the true cause of the symptoms. The burden of care for those injured in their workplace, has been cost-shifted off of many a workers comp insurer and onto the taxpayer via needed social services for the disabled and their families.
While following the teachings of ACOEM, medical schools and medical non-profits, by and large, chose to harm people further by claiming their pleas for help for severe illness after exposure, were only being made because they were mentally ill or fakers trying to scam building stakeholders.  Infants and small children, who have not be able to receive viable medical care, have been among the accused scammers. The litigation over the years has been horrendous with the ACOEM mold statement being the fraudulent mainstay of the defense in the vast majority of cases.
Needless to say, the paper in its various uses over the years, is undoubtedly one of the dirtiest tricks ever played on the American public by leaders of America’s medical communities and non-profit organizations who influence medical policies and practices. The politics in governmental organizations and in courts which have aided this fraud to continue, is shockingly inconceivable to those who are concerned for the health and safety of their fellowman and for the future integrity of United States courts.
But the good news is…..
Science and medicine continue to advance to greater understanding of how to prevent and treat these illnesses.  ACOEM removing the scientific fraud from their website and sunsetting the false concept that it is proven these chronic, debilitating and sometimes deadly illnesses could not be caused by biotoxins in water damaged buildings, is a huge milestone toward achieving that understanding and toward stopping scientific fraud upon the court.
In other words….
 
The Wicked Witch is FINALLY DEAD!
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Cal Assemblyman Jones-Sawyer re: Cal Court Corruption

Since 2010, we at Katy’s have been doing our best to inform the public that the California Judicial Branch is corrupt, and a true hazard to public health, safety and welfare.  We blew a whistle of fraud in public health policy over the mold issue.  Several Cal court leading judges and justices falsified court docs in SLAPP suits to aid the fraud to continue to harm people all across the county.
The fraud was and still is being perpetrating by federal contractors and expert defense witnesses of the United States Department of Justice — namely Bruce J. Kelman and Bryan D. Hardin of Veritox, Inc.  The ten years of fixed litigation and relentless harassment by criminal means in California courts has been a failed attempt to shut us up of not only the scientific fraud over the mold issue, but also of the criminal acts of several Cal jurists who willfully broke the law to aid it to continue to fleece the public — while lives have been devastated.
Did you think we were just kidding or just screaming in the wind?  WE WEREN’T and WE STILL AREN’T!  Here it is in the words of California Assemblyman Reggie Jones Sawyer:
“Last week a mighty ray of sunlight beamed down on an appalling example of government inefficiency and wasteful spending of precious taxpayer dollars. This sunlight came in the form of a state audit, which my office requested, of the Administrative Office of Courts (AOC), a department of California’s judiciary branch.
As co-chair of the Assembly Select Committee on Justice Reinvestment and chair of the Sub-Committee on Public Safety which funds California’s courtrooms, I directed the California State Auditor to investigate potential mismanagement of state funds.
The audit released last week exposed the fact that from 2010 to 2014, the AOC wasted $30 million on lavish compensations and questionable business practices as a result of inadequate Judicial Council oversight.
According to its official responsibilities, the AOC supposedly provides administrative support to trial courts, yet the audit report revealed that wasn’t entirely factual. Through their investigation, the state auditor discovered that the courts requested only 55 percent of the AOC’s services because the office never formally surveyed courts in the first place to determine their basic needs. As a result, the office continuously funded unused services and wasted state resources.
Moreover, the AOC’s employees are paid handsomely even when compared to executive branch employees. The former receive an average salary of approximately $82,000 whereas the latter are paid on average $20,000 less.
Eight of the office’s directors were paid at least $179,000 while managing fewer than 120 employees in fiscal year 2013-14. In comparison, the director of California Department of General Services received $167,000 while managing more than 3,600 employees. Gov. Jerry Brown — an elected official — was paid a hair under $174,000. This wage disparity is staggering and completely unjustified.
The audit also highlighted the fact that the AOC continued utilizing services of contractors, consultants and temporary workers in spite of the Strategic Evaluation Committee’s recommendation to downsize and cut costs. These suggestions were ignored, and the office spent $13.5 million on 55 contractors, although it could have saved $7 million by deploying state employees in similar roles.
Other examples of the office’s blatant disregard for taxpayer money can be seen through its excessive lunch reimbursements. The audit report showed that each Administrative Office staff member was reimbursed up to $40 for business lunch or dinner, and $25 for breakfast. Spending on meals, however, went from $60,000 in 2011-12 and 12-13 fiscal years to $266,000 in 2013-14 — essentially quadrupling. I’d like to know why.
The AOC helps trial courts manage “content strategy, publishing, and metrics evaluation for social media channels including You Tube and Twitter.” The AOC rated this service as critical, yet a total of one trial court has requested this service.
Even worse, all of this irresponsible spending by the AOC coincided with $1.2 billion of budget cuts to the state’s court systems since 2011, forcing the closure of 51 courthouses and more than 200 courtrooms, according to the L.A. Times.
After years of crushing deficits and the slashing of critical funding to important health and human services for disadvantaged communities throughout California, the last thing our state needs is this kind of disregard for state funds and the flat-out waste of millions in precious taxpayer money.
The Sixth Amendment guarantees one’s right to a speedy and fair trial. However, some users experienced hours of waiting at clerk windows after driving more than 100 miles to the nearest courthouse. Is this — people being unable to even file cases because of an understaffed court system — what we consider to be “speedy”?
California families and our children are all bearing the recent costs of state government budget cuts — with prison overcrowding, increasing college tuition, K-12 classrooms overflowing, less services for the poor, crumbling infrastructure, and more.
That’s why I believe strongly that neither the Judicial Council nor the AOC should be exempted from ensuring that every penny of taxpayer money must be spent wisely, efficiently and effectively — especially when it comes to our overcrowded court system.
Yet the AOC and the Judicial Council remain oblivious — indifferent, even — to the sacrifices that nearly every other state department or agency has made. The former continued its trend of excessive spending despite having received numerous recommendations for change from different entities. The office’s responses to criticisms over its allocation of money has been underwhelming at best.
Because of this, we must take a heavy-handed approach given that the AOC has had a long track record in reckless spending and the Judicial Council has clearly abused the autonomy offered by state laws. As such, I plan to work diligently in the Assembly to ensure the courts do not receive funding until the office and the council formulate a comprehensive plan responding to the issues brought forth by this important state audit.”
Assemblyman Reggie Jones-Sawyer, D-Los Angeles, represents the 59th District and is chair of the California Legislative Black Caucus.
**********************
So…..when is someone going to file criminal charges?  This is WRONG and DANGEROUS that these people are being allowed to continue on their merry way with barely a slap on the wrist and a promise that they won’t do it again.
History proves that they are going to do it again, and again, and again, until someone stops them.  If they were common folk like the rest of us, many of the leaders of California’s judicial branch and the federal contractors at Veritox, Inc., plus their Cal SLAPP attorney would have been in jail long ago.  Equally at fault for aiding this to continue, Cal Attorney General Kamala Harris should be made to make sure there is jailtime in their future!
Sharon Noonan Kramer
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The U.S. Government owes water-boarding whistleblower and the world a huge apology

by Sharon Noonan Kramer, whistleblower of a billion dollar scientific fraud in U.S. policy and courts by government contractors — retaliated against by criminal means in the California courts to aid the fraud to continue.
It seems perfectly clear that U.S. Attorney General Eric Holder will not be holding anyone accountable for the torture of prisoners under the Bush Administration.  So is anyone going to be holding Holder accountable for retaliating against the torturers’ whistleblower under the Obama Administration?
Huffington Post, December 10, 2014 “The One Man Jailed For CIA Torture Tried To Expose It
Why is John Kiriakou, the CIA agent who blew the whistle on water boarding, still in jail? And why isn’t the Senate Judiciary Committee discussing the abuse of court and abuse of prosecutorial power to retaliate against him and his right to free speech for the public good?
It is unsettling that Senator Dianne Feinstein is now being holier-than-thou about the unbridled prisoner torture at Abu Grab — while making it appear it was only a Republican problem that was set right by the Democrats. Via the Senate Intelligence Committee and other sources, she has known what was going on for years. To our knowledge, she did nothing to stop it until it became publicly known as occurring. In her role on the Senate Judiciary Committee, she did nothing to stop Holder’s persecution of John Kiriakou for his valiant efforts to end the crimes against humanity by being the one who publicly exposed the torture.
This is not just a one party problem, folks! John has been persecuted by the Department of Justice during Obama’s term while attempting to cover up for horrifying acts of torture during Bush’s terms. He was falsely accused of exposing the identity of a U.S. spy to the media.  In reality, he exposed the water-boarding torture to the media after none of his superiors would lift a finger to stop it. Its John’s efforts to shed public light on the problem, not the Democrats in DC, that caused the torture to stop.
Yet, to this very day, he sits in a jail cell for stopping crimes against humanity by his former employee, the United States government.  John has five children and had an exemplary career record as a public servant until he exposed the systematic acts of torture by the CIA, et.al.  For his efforts on behalf of his fellowman, Holder’s goons forced him to plead guilty to something he did not do and to accept thirty months incarceration — or face the real possibility of a lifetime in jail while his children grew up without a father.
Why isn’t Feinstein talking about the continued wrongful incarceration of John Kiriakou as she attempts to portray that ethics breaches in U.S. government leadership are now a thing of the past? In light of the new Senate Intelligence Committee CIA Torture Report, why hasn’t John Kiriakou been promptly released from jail and given a full pardon?
This man deserves a Medal of Honor. In addition to his concerns for humane treatment of all people, his primary concern was that our troops would be tortured in retaliation for us torturing prisoners. As he tried to warn would happen, its difficult to point the finger today at those who would behead their enemy, when their enemy has been torturing their allies for years. So who is really culpable for the escalating violence, culminating in beheadings? Seems to me that politicos in Washington, D.C. share much of the responsibility.
And let’s not forget the abuse of law and judicial process used to retaliate against Edward Snowden, Chelsea Manning, Thomas Drake, Aaron Swartz and many other whistleblowers of US government wrongs over the past decade and a half. The orchestrated acts to silence, punish, discredit and destroy their lives under the color of law — simply serves to illuminate that U.S. government leadership is not always what they publicly profess to be — down BOTH sides of the aisle!
Thus far, the early twenty-first century has been a shameful testament of current accepted D.C. practices by both Democrats and Republicans when honest people try to stop unlawful and criminal government acts that are harmful to us all.
Admitting the water boarding was an act of torture while using it in a game of political one-upmanship against the other party; and with no one being punished for the tortuous acts or the retaliation against a U.S. citizen to cover-up the acts — simply establishes that lack of ethics and lack of personal accountability is alive and well in Washington DC.
United States politicians from both parties owe the world a HUGE apology for the inhumane treatment of war prisoners and for the retaliation against a U.S. citizen to cover up the torture — along with retaliation against many other U.S. citizens for exposing governmental wrongs.
President Obama sending Whistleblower John Kiriakou home to his wife and five children for Christmas, would be a good place for them all to start that apology.
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Rolling Stone: Blowing the Whistle on the US Department of Justice

by Sharon Noonan Kramer
On November 6, 2014, Rolling Stone published an excellent article by Matt Taibbi.  The article is titled, “The $9 Billion Witness: Meet JPMorgan Chase’s Worst Nightmare
The article’s gist is of a Canadian woman who knows how to cause those responsible for the multi-billion dollar mortgage defrauding to finally face criminal charges in the United States; and what has been done by the U.S. Department of Justice (DOJ) to keep what she knows concealed in the courts, so that no criminal prosecutions ever occur.
This expose’ really struck a chord with us.  We completely understand Mr. Taibbi’s point that the real story is not the fraud itself.  The real story is the cover-up of how insidious the fraud really is; and how those who have despicably fleeced the public continue to profit from unconscionable under the color of law acts of the DOJ, et.al., as thousands of U.S. citizens continue to suffer from the fallout.
We at Katy’s know and can prove that this is not the only instance in which bad actors at the DOJ and friends have been lying and shielding those who have committed criminal acts to fleece the United States public of billions of dollars.  People have been permanently disabled and some have died from the retalitory criminal acts to conceal what we know from coming to public light.  Not one person has been punished for the collusion to defraud by contractors of the DOJ, et.al., in ten years of lying and falsifying court documents in California, to cover-up scientific fraud in U.S. public health policies and courts all across the nation.
Rolling StoneEverything that I thought was bad at the time turned out to be a million times worse…I tried to go on with the things I was doing, but I just stopped sleeping and couldn’t eat.”  Whistleblower Alayne Fleischmann
 Six years after the crisis that cratered the global economy, it’s not exactly news that the country’s biggest banks stole on a grand scale. That’s why the more important part of Fleischmann’s story is in the pains Chase and the Justice Department took to silence her.” Matt Taibbi
Below are key excerpts of Mr. Taibbi’s excellent Rolling Stone article:
Alayne Fleischmann is the central witness in one of the biggest cases of white-collar crime in American history, possessing secrets that JP Morgan Chase CEO Jamie Dimon late last year paid $9 billion…to keep the public from hearing.
In today’s America, someone like Fleischmann – an honest person caught for a little while in the wrong place at the wrong time – has to be willing to live through an epic ordeal…. And when she finally gets there, she still has to risk everything to take that last step. “The assumption they make is that I won’t blow up my life to do it,” Fleischmann says. “But they’re wrong about that.”
That’s when she decided to break her silence. “I tried to go on with the things I was doing, but I just stopped sleeping and couldn’t eat,” she says. “It felt like I was trying to keep this secret and my body was literally rejecting it.”
“Everything that I thought was bad at the time,” Fleischmann says, “turned out to be a million times worse.”
Fleischmann knew something the rest of the world did not: The criminal investigation was going nowhere.
She’s had to struggle to find work despite some striking skills and qualifications, a common symptom of a not-so-common condition called being a whistle-blower.
 
“I could be sued into bankruptcy,” she says. “I could lose my license to practice law. I could lose everything. But if we don’t start speaking up, then this really is all we’re going to get: the biggest financial cover-up in history.”
 
Back in 2006, as a deal manager at the gigantic bank, Fleischmann first witnessed, then tried to stop, what she describes as “massive criminal securities fraud” in the bank’s mortgage operations.
 “It used to be if you wrote a memo, they had to stop, because now there’s proof that they knew what they were doing,” she says. “But when the Justice Department doesn’t do anything, that stops being a deterrent. I just didn’t know that at the time.”
In February 2008, less than two years after joining the bank, Fleischmann was quietly dismissed in a round of layoffs. A few months later, proof would appear that her bosses knew all along that the boom-era mortgage market was rotten.
She was blocked at every turn: by asleep-on-the-job regulators like the Securities and Exchange Commission, by a court system that allowed Chase to use its billions to bury her evidence, and, finally, by officials like outgoing Attorney General Eric Holder, the chief architect of the crazily elaborate government policy of surrender, secrecy and cover-up.
Fleischmann later realized that the government wasn’t interested in having her testify against Chase in court or any other public forum. Instead, the Justice Department’s political wing, led by Holder, appeared to be using her, and her evidence, as a bargaining chip to extract more hush money from Dimon. It worked. Within weeks, Dimon had upped his offer to roughly $9 billion.
The newspapers and the Justice Department described the deal as a “$13 billion settlement,” hailing it as the biggest white-collar regulatory settlement in American history. The deal released Chase from civil liability. And, in what was described by The New York Times as a “major victory for the government,” it left open the possibility that the Justice Department could pursue a further criminal investigation against the bank. But the idea that Holder had cracked down on Chase was a carefully contrived fiction, one that has survived to this day.
“They typically charge only one offense when there are dozens. It would be like charging a serial murderer with a single assault and giving them probation,” says Dennis Kelleher of the financial reform group Better Markets.
Instead of a detailed complaint naming names, Chase was allowed to sign a flimsy, 10-and-a-half-page “statement of facts” that was: (a) so short, a first-year law student could read it in the time it takes to eat a tuna sandwich, and (b) so vague, a halfway intelligent person could read it and not know anyone had done anything wrong. The ink was barely dry on the deal before Chase would have the balls to insinuate its innocence.
Chase was allowed to treat some $7 billion of the settlement as a tax write-off. Couple this with the fact that the bank’s share price soared six percent on news of the settlement, adding more than $12 billion in value to shareholders, and one could argue Chase actually made money from the deal. What’s more, to defray the cost of this and other fines, Chase last year laid off 7,500 lower-level employees. The board awarded a 74 percent raise to the man who oversaw the biggest regulatory penalty ever, upping his compensation package to about $20 million.
In September, at a speech at NYU, Holder defended the lack of prosecutions of top executives on the grounds that, in the corporate context, sometimes bad things just happen without actual people being responsible. “Responsibility remains so diffuse, and top executives so insulated,” Holder said, “that any misconduct could again be considered more a symptom of the institution’s culture than a result of the willful actions of any single individual.”
In other words, people don’t commit crimes, corporate culture commits crimes! It’s probably fortunate that Holder is quitting before he has time to apply the same logic to Mafia or terrorism cases.
Or, as Fleischmann translates it, [Holder said], “I will personally stay on to make sure that no one can undo the cover-up that I’ve accomplished.” Despite it all, Fleischmann still had faith that the Justice Department or some other federal agency would make things right. “I guess I was just a trusting person,” she says. “I wasn’t cynical. I kept hoping.”
Because after all this activity, all these court actions, all these penalties (both real and abortive), even after a fair amount of noise in the press, the target companies remain more ascendant than ever. The people who stole all those billions are still in place. And the bank is more untouchable than ever – former Debevoise & Plimpton hotshots Mary Jo White and Andrew Ceresny, who represented Chase for some of this case, have since been named to the two top jobs at the SEC. As for the bank itself, its stock price has gone up since the settlement and flirts weekly with five-year highs.
Holder or whoever succeeds him can still make the whole thing disappear by negotiating a soft landing for the company. “That’s the thing I’m worried about,”  says Fleischmann. “That they make the whole thing disappear. If they do that, the truth will never come out.”
Truth is one thing, and if the right people fight hard enough, you might get to hear it from time to time.
Read more: http://www.rollingstone.com/politics/news/the-9-billion-witness-20141106#ixzz3IlIrWskJ

 

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