What’s in the News

Week in Review


The Justice Department is accusing the private contractor of robbing U.S. taxpayers out of tens of millions of dollars by conducting phony background checks.
USIS, the private contractor that conducted the background checks of both Edward Snowden and Washington Navy Yard shooter Aaron Alexis, is accused in a Justice Department lawsuit filed of conducting 665,000 fake background checks between 2008 and 2012.
“USIS management devised and executed a scheme to circumvent contractually required quality reviews of completed background investigations in order to increase the company’s revenues and profits,” according to the Justice Department complaint filed in U.S. District Court in Alabama.
The DOJ lawsuit cites internal emails to back up charges that USIS senior officials devised a wide-ranging “scheme” to defraud the federal government on background checks through a practice known as “dumping” or “flushing” in order to boost the firm’s profits.
“Shelves are as clean as they could get,” reads one April 2010 email from a “workload leader” to USIS director of National Quality Assurance.  “Flushed everything like a dead goldfish.”  Another email reads: “Scalping tickets for ‘Dick Clark’s Dumpin’ New Year’s Eve!' ... Who needs 2?”
The practice of “dumpin” or “flushing” involved certifying to the U.S. Office of Personnel Management that full “quality review” background checks had been  performed when in fact those reviews had not been completed. Aided by a software program known as “Blue Zone,” USIS identified large volumes of cases at the end of day as “Review Complete” – and then fraudulently certified them to OPM, according to the complaint.
Between March 2008 and September 2012, “USIS released at least 665,000 background investigations” to OPM, certifying them as completed when they actually hadn’t been, the complaint charges. This amounted to 40 percent of all the background checks performed by USIS done during this period, according to the complaint.
The allegedly fraudulent background checks included employees seeking security clearances at the Department of Defense, Homeland Security, Justice Department and other federal agencies.
The suit charges that USIS senior management “was fully aware of, and in fact, directed the dumping practices.” It acknowledges that the firm was paid $11.7 million in bonuses under its contract between 2008 and 2010.

USIS, which on its website calls itself “the leader in federal background investigations,” said in a statement provided to NBC News that “a small group of individuals” was responsible for the bogus checks and that their conduct was “contrary to our values and commitment to exceptional service.”

“Since first learning of these allegations nearly two years ago, we have acted decisively to reinforce our processes and management to ensure the quality of our work and adherence to OPM requirements,” USIS said.

“We appointed a new leadership team, enhanced oversight procedures, and improved control protocols.  From the outset, we have fully cooperated with the government’s investigation and remain focused on delivering the highest quality service under our OPM contracts.”

A company source, who spoke to NBC News on condition of anonymity, said that some employees involved in the fraud “were terminated” and also stressed that neither the Snowden nor the Alexis background checks were among those cited as fraudulent in the complaint. (The complaint does not identify any of the allegedly improper checks.)
The civil lawsuit was filed by the Justice Department under the False Claims Act. The suit accuses the company of filing false claims, making false statements and breach of contract.


The Federal Reserve trimmed its unprecedented, massive stimulus program again amid signs that economic growth has picked up. The move, announced after Ben Bernanke’s last meeting at the helm of the Fed, came despite concerns about turmoil in emerging market economies recently.
The Fed said it would reduce the bond buying program, and in its December meeting decided to decrease the bond buying program from $75 billion to $65 billion. The program helped stabilized the economy through the Great Recession.
“Taking into account the extent of federal fiscal retrenchment since the inception of its current asset purchase program, the Committee continues to see the improvement in economic activity and labor market conditions over that period as consistent with growing underlying strength in the broader economy,” the Fed said, after a meeting of its policy-setting Federal Open Market Committee.
The decision lends credence to a widely held market belief that the Fed will wrap up QE by the end of 2014. The new balance will see purchases of $30 billion a month in mortgage-backed securities and $35 billion in Treasuries. “It’s been obvious for a few months that the Fed wants out,” Bill Gross, co-chief investment officer at bond giant Pimco, said.
“What we’re seeing is an end of QE in October, early November of this year, and then importantly a focus on the policy going forward.”
The meeting was Bernanke’s last before handing over the reins at the Fed to Vice-chairman Janet Yellen. Bernanke took the Fed far into uncharted territory during his eight years on the job, building a $4 trillion balance sheet and keeping interest rates near zero for more than five years to pull the economy from its worst downturn in decades.
Policymakers stuck to their promise to keep rates near zero until well after the U.S. unemployment rate, now at 6.7 percent, falls below 6.5 percent, especially if inflation remains below a 2-percent target.
With concerns growing over possible harm from so much money printing, the Fed decided last month to make its first cut to the bond buying. Data in recent weeks, from consumer spending and industrial production, was largely upbeat and has bolstered the view of an improving economy.
Forecasters estimate U.S. GDP grew at an above-trend annual rate of 3.2 percent in the fourth quarter after a 4.1 percent advance in the prior three months.


President Barack Obama vowed, during his State of the Union address, to use executive powers to sidestep Republican roadblocks on Capitol Hill. The President says he will not wait for Congress to move forward on important issues and is prepared to take executive action in 2014.
“America does not stand still – and neither will I,” Obama said. “So wherever and whenever I can take steps without legislation to expand opportunity for more American families, that’s what I'm going to do.”
Obama declared, “I believe this can be a breakthrough year for America. … What I offer tonight is a set of concrete, practical proposals to speed up growth, strengthen the middle class, and build new ladders of opportunity into the middle class. Some require congressional action, and I’m eager to work with all of you.”
He added, “In the coming months, let’s see where else we can make progress together. Let’s make this a year of action.  That’s what most Americans want.”
Obama outlined a litany of executive actions he intends to take in the coming months to advance the themes he focused on in his speech. Among them:

Raising the minimum wage to $10.10 an hour for workers on federal contracts;
Establishing a government-backed “myRA” retirement savings program for working Americans;
Setting higher fuel-efficiency standards for heavy-duty trucks.
The President encouraged lawmakers to extend unemployment insurance, raise the overall minimum wage, pass immigration reform, expand Pre-K education, cut tax breaks for wealthy retirees, expand the Earned Income Tax Credit, give him Trade Promotion Authority and pass patent legislation – among other priorities Obama mentioned, and which Congress would have to approve.

Republicans sought to soften their response to Obama with a speech from Washington Rep. Cathy McMorris Rodgers. “Too many people are falling further and further behind because, right now, the president’s policies are making people’s lives harder,” she said in the official GOP response.
“Republicans have plans to close the gap – plans that focus on jobs first without more spending, government bailouts, and red tape.”
Obama leaned heavy on foreign policy. “Even as we aggressively pursue terrorist networks – through more targeted efforts and by building the capacity of our foreign partners – America must move off a permanent war footing,” Obama said in claiming the fruits of diplomatic efforts in Iran, Syria and the Middle East.
He also threatened to veto legislation under consideration by Congress to increase sanctions on Iran, a proposal which could derail diplomatic talks with the Iranian regime.
At times, Obama seemed to scold the House GOP, particularly for its repeated votes to undo health care reform, his signature domestic achievement. “Let’s not have another 40-something votes to repeal a law that’s already helping millions of Americans like Amanda,” he said. “The first 40 were plenty.  We got it.”
Obama also acknowledged some of the initial struggles encountered by the Affordable Care Act, namely lackluster enrollment numbers depressed in part by the botched launch of the online portal to sign up for health care plans. “That’s why, tonight, I ask every American who knows someone without health insurance to help them get covered by March 31,” he said.
But Obama closed his speech with upbeat examples of Americans who had benefited from programs to improve mobility and expand opportunity. And he ended his remarks with a plea for cooperation.
“The America we want for our kids, a rising America where honest work is plentiful and communities are strong; where prosperity is widely shared and opportunity for all lets us go as far as our dreams and toil will take us – none of it is easy,” he said.
“But if we work together; if we summon what is best in us, with our feet planted firmly in today but our eyes cast towards tomorrow – I know it’s within our reach.”


More than 80,000 football fans are expected to brave near-freezing temperatures to attend the New York region’s first Super Bowl on Sunday, and more than 3,000 security guards, 700 cops and hundreds of high-tech gadgets will be on hand to greet them.
Similar armies of human and technological watchdogs will keep eyes and lenses trained on the tens of thousands of other people who will descend on the city to enjoy other festivities associated with America's top sports event – making it the biggest and most-expensive security net in the 48-year history of the game.
The $1.6 billion Met Life Stadium in East Rutherford, N.J., where the game will be played, will be the most tightly guarded venue – with a 2.5 mile chain-link perimeter fence and cameras trained on every section and corridor inside. But multiple game-related events planned for New York and New Jersey add several degrees of difficulty to the job of keeping fans and participants safe, security experts say.
This Super Bowl says Ed Hartnett, former head of the New York Police Department’s Intelligence Unit, “truly defines the word ‘challenge’ when it comes to security.”
There is no intelligence indicating that terrorists have targeted the game or related events, but Hartnett says that doesn’t mean that threats don’t exist: “I would list them in priority order being a suicide bomber, a vehicle laden with explosives and a mass shooter or mass shooters similar to the Kenyan mall, or the Mumbai incidents,” he said. His concerns are echoed by law enforcement officials overseeing the game.
Extensive mass transit, bridge and tunnel networks in the vicinity are a particular area of concern, according to a review of sensitive law enforcement documents detailing the Super Bowl security plan and intelligence by NBC News.
The game is being billed as the “Mass Transit Super Bowl” by the New Jersey Transit system, and rail officials say the security experience for fans taking the train on game day will rival that of an airport, with bag-screening, K-9 teams and random searches for trains to and from the game.


A Dateline analysis of a 2011 U.S. Census Bureau report found that public housing apartments had almost four times as many roach infestations and three times as many leaks as private rental apartments. Leaks can create mold, another allergen that can spark and exacerbate asthma.

Though mold covers the ceiling and walls of the bathroom, and most likely has exacerbated Melissa’s (a child living in the apartment) asthma – the landlord, the New York City Housing Authority, has been slow to make the necessary repairs that would get rid of it, according to Dateline investigators.

In the space of just a few blocks in New York there’s an enormous income gap – and a corresponding three-fold jump in the asthma rates.

In the affluent Upper East Side, the rate among 4-to-5 year-old children is 7 percent. By contrast, in impoverished east Harlem, the neighborhood right next to it, the rate is 19 percent.

The asthma-poverty connection isn’t limited to New York, though. In Philadelphia, researchers have found asthma to be stunningly common in some of the poorer neighborhoods. In door-to-door surveys that included 5,563 children, researchers found that 21.7 percent of kids had been diagnosed with asthma.

The two communities with the highest numbers of children living below the poverty line had asthma rates of 40 percent and 47 percent, according to a 2012 study by researchers led by Dr. Tyra Byrant- Stephens, a professor at the University of Pennsylvania School of Medicine and director and founder of the community asthma prevention program at the Children’s Hospital of Philadelphia.

In St. Louis, the poorer neighborhoods have upwards of 30 percent to 40 percent asthma rates, said Dr. William Kincaid, chair of the St. Louis Regional Asthma Consortium and an assistant professor of health management and policy at the St. Louis University College for Public Health and Social Justice.

In East Baltimore, one of the poorest areas of the city, at least 95 percent of homes are infected with mouse allergen, said Dr. Elizabeth Matsui, an associate professor of pediatrics and epidemiology at the Johns Hopkins Medical Institutions. Matsui and others have found that exposure to mouse dander is even worse than exposure to cockroaches when it comes to asthma.

In Baltimore, just as in New York and St. Louis, “many homes have mold because they are not kept up well,” Matsui said. “Leaky roofs and bathroom plumbing produce water damage. Even if the leak is fixed, if the dry wall or plaster isn’t taken out, mold can grow.”

Poor neighborhoods are often the ones chosen for highways and other projects that more affluent communities manage to fend off. In New York, poor neighborhoods tend to be crisscrossed by major roads clogged with diesel-powered vehicles that spew particles into the air that can trigger or exacerbate asthma, said Matt Perzanowski, an associate professor of environmental health sciences at Columbia University’s Mailman School of Public Health.

Legislation to provide health insurance for poor kids has helped those with asthma, but it has not been a panacea. Many low-income neighborhoods don’t have enough physicians, Bryant-Stephens said. Making matters worse, poor parents often can’t get time off from their jobs to take children to the doctor.

Transportation also is an issue, Bryant-Stephens said. “Parents are making hard choices. If they have to pay the light bill, they may not have enough money to pay for tokens to get to the doctor’s office.” That’s something 33-year-old Tiana Gaines-Turner, a working mom from Philadelphia, understands all too well. Because she and her husband both have low-paying jobs, they are often strapped for cash. That means they sometimes have to borrow money to take their kids to the doctor.

Studies have shown that poor children are up to 15 times more likely to be hospitalized for asthma than their wealthier counterparts. While the visits may fix the acute problem, they’re not providing a long-term solution. “In the ER, parents don’t hear 90 percent of what we say,” Bryant-Stephens said.

“They’re very focused on the fact that their child can’t breathe. It doesn’t matter that we give them all this education.” But even when the medical care is optimal, there’s still the home environment to worry about.


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