Victim Impact Statements

Violations of labor laws are CRIMES with real victims. These criminals can be Governors, Mayors, Executives of corporations or government, Lawyers, Military, Consultants, Human Resource Executives, General Counsel, Special Counsel, fellow employees, corrupt union officials, etc.

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AN OPEN LETTER TO THE HONORABLE DEBORAH A. ROBINSON

February 27, 2011

The Honorable Deborah A. Robinson

United States District Court

333 Constitution Avenue, NW

Washington, DC 20001

RE: Sentencing of Scott J. Bloch

Dear Judge Magistrate Robinson:

Although I have been an attorney in good standing for more than 20 years, I do not write to you in my capacity as an attorney. Instead, I write to you as a deeply concerned citizen. I also wanted to share with you a unique perspective on this matter. I am the older brother of Bradley Birkenfeld, commonly referred to as the UBS Whistleblower. He is recognized as being one of the most effective whistleblowers in history, exposing and forever changing seemingly impregnable Swiss banking secrecy.

A few weeks ago, I read news accounts of the proposed plea bargain and sentencing of defendant Scott J. Bloch and I was very troubled by what I read. I then went further and read Your Honor’s February 2, 2011 Order regarding this matter. The prosecutors in this case have taken a position that can, at best, be described as odd. They exude a peculiar indifference to the very real seriousness of the offenses committed by the defendant in this matter; so much so, that their position should be met with a great degree of skepticism, at a minimum.

I realize that Your Honor does not need any detailed recitation of the sordid facts of this case. But it is important to recall what Mr. Bloch’s public responsibilities were as head of the Office of Special Counsel. He was duty-bound to protect the integrity of legitimate whistleblower complaints as well as the whistleblowers that brought forth those complaints. However, instead of protecting them, he used his position of power and authority to attack and undercut them. He was the proverbial “fox in the chicken coop”. He then compounded this abuse of power by attempting to destroy the evidence of his misdeeds and then knowingly misled a legitimate Congressional inquiry into the matter.

Whistleblowers serve a very real and useful purpose. These are people, usually on the inside of large organizations, who are uniquely positioned to observe corruption that is hidden from most outsiders, including those in law enforcement. They are able to observe – and report on – corruption that would otherwise likely go unnoticed. Whistleblower protection laws are, in fact, a great aid to law enforcement. This is why more and more laws aimed at protecting whistleblowers are being enacted. However, there are some people, many of them in law enforcement, that harbor an almost visceral contempt for whistleblowers. To these people, Mr. Bloch is a man to be admired.

Some of this hostile attitude by law enforcement professionals stems, in part, from an insecurity of being “shown up” by some outside amateur. They take it as an affront that someone outside their ranks, and who does not make their living ferreting out crime, can walk in the front door and deliver the keys to the kingdom. When whistleblowers expose a large-scale fraud, then this tends to beg the question as to why the law enforcement professionals couldn’t uncover the corruption on their own, without a whistleblower showing them the way. However, some of this hostility directed toward whistleblowers is based on pure politics. It is an ideologically-based dislike. These phenomena may be playing a role in the instant case.

My brother’s case is most illustrative on this point which is why I wanted to share this perspective with Your Honor.

My brother, Bradley, is an American citizen, born in the Boston area. While living in Geneva, Switzerland in 2001, he was “headhunted” by the large Swiss bank, UBS, to come work for them. He joined UBS later that year as a private banker working on “the American Desk”. UBS had been operating offshore, undeclared accounts for Americans (and for citizens from all over the world) for many years prior to this. As of 2005, there were up to 50,000 accounts and upwards of $19 Billion in these accounts held by American citizens and American residents. Prior to my brother starting working there, UBS had been running an operation that knowingly circumvented several U.S. laws.

One day in 2005, my brother came across a three-page document, very deeply imbedded in the bank’s intranet, that claimed to prohibit a wide range of activities, declaring many to be violations of law. The problem was that the activities listed in this document actually described the job duties of those who were working on the American Desk. It was, quite clearly, a document planted by the bank in order to give itself deniability in the event that any one of its private bankers were apprehended and exposed. The bank was fully prepared to throw its own employees “under the bus” in the event that they were discovered.

My brother immediately demanded answers from his superiors. He wanted an explanation for this discrepancy between the stated position in this 3-page document and the bank’s actual practices. He was stonewalled, and met with silence, over the course of many weeks. He then resigned from the bank. But before leaving, he had retained copies of voluminous documentation that would corroborate what he was about to tell U.S. authorities.

At great cost and at great personal risk, he came from Switzerland, where he had lived for more than 15 years, to the United States. In early 2007, without any grant of immunity he voluntarily initiated contact with the Department of Justice and the IRS. He was about to become the first Swiss private banker in history to reveal the Swiss banking secrets to the outside world – who was doing it, how they did it, how they concealed it and who some of the account holders were.

My brother made it known that he was acting as a whistleblower with regard to this foreign bank. But from the outset, he was met with open hostility from the prosecutors at the Tax Division of

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the Bush Department of Justice. Before the Department of Justice prosecutors even knew his identity, their correspondence to my brother’s counsel was aggressive and arrogant.

At the first meeting which took place at the Department of Justice in Washington, DC, one of the prosecutors, Karen Kelly, was enraged at the announcement of my brother’s whistleblower status. “You’re not a whistleblower! You’re just a tipster!” she said defiantly, almost rising out of her chair in anger while raising her voice. Her statement is of negligible legal significance but it speaks volumes as to the openly hostile attitude that seemed to be shared among the prosecutors.

After three full days of meetings, this hostility was still evident, despite the fact that my brother had just started the investigation that would lead to exposing the largest international tax fraud scheme ever uncovered. Concerned over how these prosecutors might handle this information, my brother then approached the Securities and Exchange Commission and the United States Senate Subcommittee on Permanent Investigations. As a result, both the SEC and the U.S. Senate Subcommittee on Permanent Investigations opened their own investigations into this UBS matter.

In May, 2008, the SEC and Senate were almost finished with their investigations but wanted to follow up with my brother on some details. So my brother flew back from Switzerland to the United States to continue these meetings. When he landed in Boston, the Bush DOJ had him arrested at the airport on a single conspiracy count. They arrested the whistleblower who exposed the entire scheme.

Two days later, there was another meeting at the Department of Justice, a very short distance from your courtroom. My brother continued to cooperate. At the end of the meeting, my brother was seated. He mentioned that now that he was in Washington, and these meetings were over, he might as well keep his pre-arranged meetings with the SEC and the Senate. At this moment, DOJ Tax Division attorney Kevin Downing was standing over him and shouted him down. “You’re not to contact them and you’re not to meet with them!” This conduct by Kevin Downing appears to rise to the level of obstruction of justice in two respects, when he actively interfered with my brother’s attempt to continue his meetings with the SEC and Senate and assist them with their ongoing investigations. See, 18 USC § 1505.

My brother had previously identified for the DOJ the major players who oversaw this illegal UBS scheme. Among them was Martin Liechti, a Swiss citizen. He was the kingpin, running the entire UBS offshore private banking operation from the northern tip of Canada to the southern tip of Argentina. He orchestrated the entire matter. At my brother’s urging, the DOJ finally had him apprehended at an airport in Miami in April, 2008, on a material witness warrant.

However, Liechti pled the 5th Amendment before the Senate Subcommittee and refused to testify. A month later, it was revealed that the DOJ let Liechti go back to Switzerland without being charged. It was later learned that the DOJ gave him immunity even though he never came forward voluntarily and he pled the 5th before the Senate subcommittee.

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In a phone call placed by one of my brother’s lawyers to Kevin Downing shortly after Liechti’s inexplicable release, Downing was asked why they let Liechti go. Downing’s only response was laughter. The Department of Justice had just essentially driven the getaway car for the chief architect and engineer of the largest international tax fraud scheme ever uncovered. And DOJ prosecutor Kevin Downing thought it was funny.

No UBS bankers were arrested, aside from my brother. He is presently serving a 40-month sentence at a minimum security facility. In light of Kevin Downing’s conduct outlined above, it is an open question as to whether Mr. Downing should also be serving time. Official complaints have been filed with the DOJ’s Office of Professional Responsibility regarding these offenses. However, as was evident in the Ted Stevens case, that office does not follow up on these complaints in any meaningful way. Instead, it buries them. Simply put, the DOJ Office of Professional Responsibility is a graveyard for grievances.

My brother’s whistle blowing led directly to the following: UBS paid a $780 Million fine to the United States; UBS agreed to shut down its entire offshore private banking operation for the United States; the entire executive leadership of UBS in Zurich was fired; a new tax treaty was entered into between the United States and Switzerland; Senate hearings were held and two Senate reports were issued; UBS handed over the names and account data on over 4,650 accounts. Because so much data on these accounts has been produced, the IRS and DOJ are having trouble processing them. As a result of this, the IRS has implemented tax amnesty programs, encouraging tax cheats who had accounts with UBS to voluntarily come forward. IRS Commissioner Douglas Shulman said that all of these efforts will result in billions of previously unpaid tax dollars coming into the U.S. Treasury. Incidentally, my brother also provided the DOJ with specific inside information regarding Credit Suisse and its lead private banker who was recently indicted.

My brother’s story is instructive on several levels. It demonstrates how valuable whistleblowers can be to our society and, particularly, to law enforcement efforts. Exposing corruption, be it in the corporate world or in the public sector, is something that should be encouraged. But it also shows how whistleblowers are, almost by reflex, attacked and undercut by some people who are in positions of authority.

It is interesting to note that the gross misconduct that attended Senator Ted Stevens’ prosecution was also exposed by a whistleblower, reportedly by an FBI agent who had the courage of his convictions to stand up to, and expose, this corrupted process. That miscarriage of justice was carried out by prosecutors within the DOJ’s Public Integrity Section. In light of that scandal, one can only imagine the degree of enmity that exists within the DOJ’s Public Integrity Section toward whistleblowers. I cannot help but notice that the lead prosecutor in the instant case, Mr. Glenn Leon, also apparently works within the DOJ’s Public Integrity Section.

This brings me back to the matter of Mr. Bloch. Your Honor, I don’t have a dog in this fight, per se. However, every American has a dog in this fight, in the larger sense. Quite obviously,

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somebody, somewhere in a position of authority, is making every effort to go easy on Mr. Bloch. The arguments for leniency made by the prosecutors in this case are more suited coming from the defense counsel’s table. Something seems to have gone awry. You are the one person now standing between Mr. Bloch and a free pass.

Consider the victims. Who are the victims of Mr. Bloch’s misdeeds? Given the nature of his offenses and his efforts to destroy evidence, we may never know the true number of his direct victims. But there are more victims than meet the eye. This sort of predatory behavior by Mr. Bloch, directed toward those who would expose corruption and wrongdoing, has a ripple effect beyond the walls of the Office of Special Counsel. It creates a clear chilling effect on all government employees, strongly discouraging them from speaking out against, and exposing, corruption within the government. No doubt, many whistleblowers have been intimidated into silence. Accordingly, we will never be able to accurately measure the true extent of the damage inflicted by Mr. Bloch. As with many cases of corrupt public officials, all Americans are victims.

I understand that the federal courts are not in the business of sending messages. Nonetheless, rulings from our courts are widely observed, particularly in high-profile cases such as this. American citizens should be reassured that violations of the public trust by public officials will not go unanswered. Americans should also be reminded that it is a great public service to expose corruption, particularly when that corruption exists within the government.

I sincerely appreciate you taking the time to consider my thoughts regarding these matters of great public concern. If you desire any further input from me regarding any of the issues that I have raised in the correspondence, I would be more than happy to assist you in any way that I can.

Respectfully,

Douglas Birkenfeld

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Another Victim Impact Statement: http://february22foundation.wordpress.com/2011/03/03/doug-kinans-victim-impact-statements/

 

 

An Open Letter from the Community of Whistleblowers to Attorney General Eric Holder

Dear Attorney General Holder:

            We, the undersigned, wish to bring to your attention an important issue: the effective and ethical prosecution by the Department of Justice of Scott J. Bloch, a man who has gravely damaged the federal civil service.

As you undoubtedly know, Mr. Bloch began his tenure as head of the U.S. Office of Special Counsel, in 2003.  The Office of Special Counsel’s primary purpose is to safeguard the merit system by protecting federal employees and applicants from prohibited personnel practices, especially reprisal for whistleblowing.  However, until his abrupt resignation in 2008, Mr. Bloch eroded workplace discrimination protection on the basis of sexual orientation, conducted a political purge of his own employees, attempted to intimidate subordinates from cooperating with outside investigators, deleted computer files and destroyed whistleblower cases, and made false and misleading statements under oath to Congress.  After arrest by the Federal Bureau of Investigation and arraignment by the Department of Justice (DOJ) in 2008, Mr. Bloch pled guilty to criminal contempt of Congress in exchange for probation in sentencing.  The prosecuting attorney, Glenn S. Leon, Assistant U.S. Attorney for the District of Columbia, supported the defendant’s request in United States v. Scott J. Bloch through several court hearings and pleadings.  Recently, however, the presiding federal magistrate judge, Deborah A. Robinson, raised legal concerns with the sentencing provision, and determined that a mandatory minimum jail sentence is in order.  The defendant shortly thereafter revoked his guilty plea.  DOJ has not mentioned whether it will retain Mr. Leon for any trial.

We are concerned, however, that Mr. Leon’s official conduct up to now has rendered him unfit to prosecute the defendant.  Rule 1.3 of the Model Rules of Professional Responsibility, Comment 1, states that “[a] lawyer must . . . act with commitment and dedication to the interests of the client and with zeal in advocacy upon the client’s behalf.”  (Emphasis supplied).  In the instant case, Mr. Leon would have to contradict almost a year’s worth of arguments in support of the defendant, and state the exact opposite in front of a judge or jury.  This would erode his credibility and impartiality in the public light, as one would not reasonably expect that he would be able to zealously advocate the government’s position given his track record.  The government runs the risk of getting something less than his full effort, which warrants recusal.

Nor is mere substitution of one U.S. Attorney or Department of Justice prosecutor for another proper.  Rule 1.13(a) of the Model Rules of Professional Conduct states that ”[a] lawyer employed or retained by an organization represents the organization acting through its duly authorized constituents.”  Mr. Leon is an employee of the U.S. Attorney for the District of Columbia, which is currently occupied by Ronald C. Machen, Jr.  Both Mr. Leon and Mr. Machen represent the DOJ, which you lead.  Both of these subordinates must abide by any prosecutorial decisions made by your office.  Further, United States v. Scott J. Bloch is a high-profile, politically charged case.  The Office of Special Counsel deals with some of the most politically sensitive issues in government. It is therefore unlikely that any prosecutorial decision in this case, such as advocating for probation, would not come directly from your office.  Thus, Mr. Leon’s conduct and conflicts of interest are imputed to the entire Department of Justice.  Consequently, Mr. Leon’s urging for probation is imputed to the entire Department of Justice.

In addition, given the significant harm the defendant has caused to countless whistleblowers, the U.S. government, and the American people, the public interest requires that a credible, impartial, non-partisan prosecutor be tasked to lead this prosecution.

 DOJ regulations provide for such a situation:
28 C.F.R. 600.1 provides that,

The Attorney General, or in cases in which the Attorney General is recused, the Acting Attorney General, will appoint a Special Counsel when he or she determines that criminal investigation of a person or matter is warranted and–

(a) That investigation or prosecution of that person or matter by a United States Attorney’s Office or litigating Division of the Department of Justice would present a conflict of interest for the Department or other extraordinary circumstances; and

(b) That under the circumstances, it would be in the public interest to appoint an outside Special Counsel to assume responsibility for the matter.

We believe that both criteria are met.  Given the imputation by Mr. Leon to the DOJ, and the public interest in seeing the defendant held accountable, application of this regulation seems warranted.  Indeed, an important precedent exists for invoking this regulation: the 2003 investigation of the Valerie Plame CIA leak by U.S. Attorney Patrick Fitzgerald.  In that case, high-level DOJ officials, including Attorney General John Ashcroft and Deputy Attorney General James Comey, recused themselves from the case and appointed Mr. Fitzgerald as special prosecutor per the above regulation.  According to the Boston Globe in an article dated December 31, 2003, the case “provoked widespread speculation in Washington that senior administration officials were involved, thereby giving Ashcroft a conflict of interest in overseeing the case.”  Notably, the Globe reported that

Comey did not explain why Ashcroft chose to step aside now after absorbing criticism for months for his refusal to do so.  He said only that the attorney general decided it was ‘the appropriate point in this investigation’ based on the evidence gathered to date.

The issue surrounding the attorney general’s recusal is not one of actual conflict of interest that arises normally when someone has a financial interest or something,’ Comey said. ‘The issue that he was concerned about was one of appearance.  And I can’t go beyond that.  That’s the reason he decided, really in an abundance of caution, that he ought to step aside and leave me as acting attorney general for those matters.’

We are not of the belief that there is improper involvement by current DOJ officials in the defendant’s case, however, the concern about the appearance of impropriety is equally pressing.

Attorney General Holder, we have long waited for Mr. Bloch to be held accountable in a court of law.  For too many of us, the erosion of the rule of law and ethical conduct in government came with a heavy price.  With our whistleblowing activities, we sought, and continue to seek, a government of laws, not of men.  Please help us restore this noble and long-standing principle by appointing a special prosecutor to lead United States v. Scott J. Bloch.

 Sincerely,

 The Community of Whistleblowers and Their Supporters:

Ray Adams
Air Traffic Controller
Newark Airport
Department of Transportation / Federal Aviation Administration 

Bradley Birkenfeld
The UBS Whistleblower

Gabe Bruno
Retired Manager, Flight Standards
Department of Transportation / Federal Aviation Administration
Orlando, Florida

Joe Carson, PE
Safety Engineer
Department of Energy
Knoxville, Tennessee 

Mark Danielson
Federal Police Officer
Former Special Response Team Member
Department of Energy / Lawrence Livermore National Laboratory
Barstow, California

Julia Davis
Former Customs and Border Protection Officer
Department of Homeland Security / U.S. Customs and Border Protection
Beverly Hills, California

Tom Devine
Legal Director
Government Accountability Project
Washington, D.C.

Newton R. Dickson
Former First Officer
Continental Airlines

Michael Driscoll
Former Airline Pilot
Spirit Airlines
East Dennis, Massachusetts 

Bogdan Dzakovic  
Entry-level staff employee
Department of Homeland Security / Transportation Security Administration
Former Federal Air Marshal Team Leader
Former Red Team Leader
Department of Transportation / Federal Aviation Administration
Washington, D.C. 

Kenny Edwards
Former Regional Airline Captain
Gulfstream International Airlines
Phoenix, Arizona 

Kim A. Farrington
Former Aviation Safety Inspector – Cabin Safety
Department of Transportation / Federal Aviation Administration
Flight Standards Southern Region – Orlando, Florida 

Franz J. Gayl
Science and Technology Advisor
Department of Defense / United States Marine Corps
Pentagon

Gordon Hamel
Former Director of Executive Placement
The President’s Commission on Executive Exchange
The White House

Daniel Hanley
Former B-777 Airline Captain
United Airlines

Edward Jeszka
Retired Aviation Safety Inspector
Department of Transportation / Federal Aviation Administration / Alabama, North Florida Flight Standards District Office
Birmingham, Alabama

Douglas Kinan
Former Equal Employment Opportunity Specialist
Department of Defense / Defense Contract Management Agency East
Boston, Massachusetts

Robert J. MacLean
Former Federal Air Marshal
Department of Homeland Security / Transportation Security Administration / Federal Air Marshal Service
Orange County, California

Shawn Malekpour
Aerospace Engineer
Chicago Aircraft Certification Office
Department of Transportation / Federal Aviation Administration

David Pardo
Former Attorney/Advisor
Department of Transportation / Federal Aviation Administration
Alexandria, Virginia

Dr. Janet Parker M.S., DVM 
Executive Director, Medical Whistleblower 
Medical Whistleblower Advocacy Network – Human Rights Defenders
Lawrence, Kansas

Spencer Pickard
Former Federal Air Marshal
Department of Homeland Security / Transportation Security Administration / Federal Air Marshal Service
Dallas, Texas

Nada Prouty
Former CIA Covert Operations Officer
Former FBI Special Agent
Central Intelligence Agency
Department of Justice / Federal Bureau of Investigation
Vienna, Virginia

Denise A. Romano
Corporate Governance Expert, Author
Columbia University Whistleblower
New York City, New York

Coleen Rowley
Retired FBI Agent
Department of Justice / Federal Bureau of Investigation

George Sarris
RC-135 Aircraft Mechanic
Offutt Air Force Base, Nebraska

Craig Sawyer
Former ATSAC (Manager)
Department of Homeland Security / Transportation Security Administration / Federal Air Marshal Service
Las Vegas, Nevada

Tony Shaffer
LtCol, US Army Reserve
Former Senior Intelligence Officer (Operations)
Department of Defense / Defense Intelligence Agency

Rachelle Halliburton, on behalf of the late Sharon E. Simmons
Former Team Leader, Annual Review Team, Washington District Office
Small Business Administration

Don Soeken, Ph.D
United States Public Health Service 06 Officer (retired)
Whistleblower Support Fund and International Whistleblower Archive

Robert Spahr
Aviation Safety Inspector
Department of Transportation / Federal Aviation Administration

R.W. Van Boven, M.D., D.D.S.
Physician-Scientist and Former Director
Department of Veterans Affairs / The Brain Imaging and (TBI) Recovery Laboratory

Glenn A. Walp, Ph.D
Former Office Leader of the Office of Security Inquiries
Department of Energy / Los Alamos National Laboratory
Criminal Justice Consultant and Adjunct Professor, Penn State University
Phoenix, Arizona

Mark Whitacre
Chief Operating Officer/President
Cypress Systems, Inc.
Former Executive
Archer Daniels Midland

Richard Wyeroski
Former Aviation Safety Inspector
Department of Transportation / Federal Aviation Administration
Bayport, New York

Charlotte Yee
Former San Francisco Regional Economist
Department of Labor / Bureau of Labor Statistics

More Coming Soon!