Turns out that Facebook Inc is the biggest baddie of all on the Internet

“The FTC is firmly and fully committed to using all of its tools to protect the privacy of consumers. Foremost among these tools is enforcement action against companies that fail to honor their privacy promises, including to comply with Privacy Shield, or that engage in unfair acts that cause substantial injury to consumers in violation of the FTC Act. Companies who have settled previous FTC actions must also comply with FTC order provisions imposing privacy and data security requirements. Accordingly, the FTC takes very seriously recent press reports raising substantial concerns about the privacy practices of Facebook. Today, the FTC is confirming that it has an open non-public investigation into these practices.”  [US Federal Trade Commission (FTC), Statement, 26 March 2018]

It may have been the Cambridge Analytica-Facebook situation as first set out by Carole Cadwalladr at The Guardian & The Observer (UK) that recently alerted the average Internet user to the issue of digital privacy on social media and, it was certainly the situation which caught the eye of the US Federal Trade Commission which is now investigating.

The story of that data harvest so far.....

The Guardian UK, 25 March 2018:

The story of how those data made the journey from Facebook’s servers to Cambridge Analytica’s is now widely known. But it is also widely misunderstood. (Many people were puzzled, for example, by Facebook’s vehement insistence that the exfiltration of a huge trove of users’ data was not a “breach”.) The shorthand version of what happened – that “a slug of Facebook data on 50 million Americans was sucked down by a UK academic named Aleksandr Kogan, and wrongly sold to Cambridge Analytica” – misses an important point, which is that in acquiring the data in the first place Kogan was acting with Facebook’s full knowledge and approval.

In 2013, he wrote an app called “Thisisyourdigitallife” which offered users an online personality test, describing itself as “a research app used by psychologists”. 

Approximately 270,000 people downloaded it and in doing so gave their consent for Kogan to access information such as the city they set on their profile, or content they had liked, as well as more limited information about friends who had their privacy settings set to allow it. This drew more than 50 million unsuspecting Facebook users into Kogan’s net.

The key point is that all of this was allowed by the terms and conditions under which he was operating. Thousands of other Facebook apps were also operating under similar T&Cs – and had been since 2007, when the company turned its social networking service into an application platform.

So Kogan was only a bit player in the data-hoovering game: apps such as the insanely popular Candy Crush, for example, were also able to collect players’ public profiles, friends lists and email addresses. And Facebook seemed blissfully indifferent to this open door because it was central to its commercial strategy: the more apps there were on its platform the more powerful the network effects would be and the more personal data there would be to monetise.

That’s why the bigger story behind the current controversy is the fact that what Cambridge Analytica claimed to have accomplished would not have been possible without Facebook. Which means that, in the end, Facebook poses the problem that democracies will have to solve. [my yellow highlighting]

However, it is not the only way Facebook is collecting personal information to enrich Zuckerberg and his shareholders.

Now we find out that Facebook Inc is scraping information from Android devices such as mobile phones and adding phone logs to its Big Brother database.

Global News, 25 March 2018:

In the same week Facebook found itself in the middle of a massive data scandal, recent reports indicate that the social media giant has also scraped records of phone calls and SMS data from its users with Android devices without explicit permission.

New Zealand-based software developer Dylan McKay tweeted earlier this week that upon downloading his Facebook data in zip file (which is an option for all users) he claims to have discovered records of phone calls and a historical data of every contact on his phone., including contacts he no longer had, from a period between 2016 and 2017.

Downloaded my facebook data as a ZIP file

Somehow it has my entire call history with my partner's mum pic.twitter.com/CIRUguf4vD

— Dylan McKay (@dylanmckaynz) March 21, 2018

After he made the discovery, McKay set up a Google poll to gather evidence from other users who’ve been affected.

So far, just under 900 people have responded to the poll, and more than 20 per cent confirmed they found call records and/or text metadata in their Facebook data archive. Another 74 people responded to the poll saying that MMS data was collected, 106 people responded saying that SMS data was collected, and 104 responded saying that cellular calls were collected.

READ MORE: Here’s who’s using your Facebook activity to get inside your head

The story was first published by the tech news website Ars Technica on Saturday, who interviewed several Facebook users, and had a member of its staff download their Facebook data archive. Following, this, the site could confirm that the data file downloaded by the staff member contained call logs from a device that individual used between 2015 and 2016, as well as SMS and MMS message data.

Several Global News staff members also requested their data archives as well in the preparation of this story and some found that the contact lists from their mobile devices were recorded in the file. No one noted any text message or call logs in the data files they downloaded.

Ars Technica reached out to Facebook for comment before the publication of its story, who said that the practice was a common one among social networking and messaging apps.

“The most important part of apps and services that help you make connections is to make it easy to find the people you want to connect with. So, the first time you sign in on your phone to a messaging or social app, it’s a widely used practice to begin by uploading your phone contacts.”

Following McKay’s tweets, other users came out on social media expressing similar concerns about what they discovered after downloading their data archives.

Oh wow my deleted Facebook Zip file contains info on every single phone cellphone call and text I made for about a year- cool totally not creepy.

— Mat Johnson (@mat_johnson) March 23, 2018

I’ve just looked at the data files I requested from Facebook and they had every single phone number in my contacts. They had every single social event I went to, a list of all my friends (and their birthdays) and a list of every text I’ve sent.

— Emma Kennedy (@EmmaKennedy) March 25, 2018

…In recent years, the company has updated this process to clarify that when requesting access to your contact list, it intends to access all call logs and SMS text messages as well, but Android users in the past may have unknowingly given Facebook access to this data. [my yellow highlighting]

It is also wise to remember that even Internet users who do not have a Facebook account have their PC or other digital device scanned for information each time they click on a link to Facebook. 

Facebook image via ZDNet, 3 January 2014

ZDNet on 3 January 2014: By "content" Facebook means “anything you or other users post on Facebook”. By "information" Facebook means “facts and other information about you, including actions taken by users and non-users who interact with Facebook”. [my yellow highlighting]

Nor should we ignore this report about Facebook's surreptitious activities.......

Law360 (March 2, 2018, 7:02 PM EST) -- A California federal judge held Friday that Facebook can’t shake a proposed class action over its allegedly unlawful collection and storage of non-users’ facial scans, declining to toss the matter for lack of standing, just as he recently did in a related suit involving users of the site.

U.S. District Judge James Donato rejected Facebook Inc.’s renewed motion to dismiss litigation led by Frederick William Gullen for lack of subject-matter jurisdiction, pointing to his Feb. 26 decision in a related proposed class action accusing the social media... [my yellow highlighting]

Then there is the lobbying to discourage federal regulation of Facebook.......

According to SOCIAL MEDIA CASEROUNDUP (selected cases) in April 2015, by 2013 Facebook Inc had spent more than US$1 million on lobbying efforts to water down the US Children's Online Privacy Protection Act (COPPA). It was particularly concerned about any change of status of third party "add ons"/"plug-ins" which might by default make platforms like Facebook legally liable for any harm to a minor/s which occurred, as well asbeing resistant to any increase in general protections for minors or any expanded definition of protected "personal information" being included in the Act.

Quartz, 22 March 2018:

Facebook CEO Mark Zuckerberg said yesterday that the company welcomes more regulation, particularly to bring transparency to political advertising online. But in recent months, Facebook has been quietly fighting lawmakers to keep them from passing an act that does exactly that, campaign transparency advocates and Congressional staff tell Quartz.

The Honest Ads Act was introduced last October to close a loophole that has existed since politicians started advertising on the internet, and was expected by many to sail through Congress. Coming as Congress investigated how Russia used tech companies to influence the 2016 election, it was considered by many in Washington DC to be the bare minimum lawmakers could do to address the problem.

The act introduces disclosure and disclaimer rules to online political advertising. Tech companies would have to keep copies of election ads, and make them available to the public. The ads would also have to contain disclaimers similar to those included in TV or print political ads, informing voters who paid for the ad, how much, and whom they targeted.

“The benefit of having disclaimers on all political ads [is] the more suspicious ads would be more identifiable,” said Brendan Fischer, the director of federal and Federal Election Commission reform at theCampaign Legal Center (CLC) in Washington.

In a vote of confidence from bitterly-divided Washington, the act was rolled out by a bipartisan group of senators—John McCain, the Republican from Arizona, and Democrats Amy Klobuchar from Minnesota and Mark Warner of Virginia—and it currently has the support of 18 senators. But it hasn’t moved from the committee on “Rules and Administration” since was first introduced, thanks in part to Facebook’s lobbying efforts.

Fischer, who is a co-author of a CLC report on US vulnerabilities online after the 2016 election, accuses Facebook of “working behind the scenes using the levers of power to stop any legislation from moving forward.”

Facebook’s lobbying clout

Lobbyists for the company have been trying to dissuade senators from moving the Honest Ads Act forward, some Congressional aides say. 

Facebook’s argument to Congress behind the scenes has been that they are “voluntarily complying” with most of what the Honest Ads Act asks, so why pass a law, said one Congressional staffer working on the bill. Facebook also doesn’t want to be responsible for maintaining the publicly accessible repository of political advertising, including funding information, that the act demands, the staffer said.

Facebook spent nearly $3.1 million lobbying Congress and other US federal government agencies in the last quarter of 2017, on issues including the Honest Ads Act according to its latest federal disclosure form. It also signed on Blue Mountain Strategies, a lobbying firm founded by Warner’s former chief of staff, an Oct. 30, 2017 filing shows.

It’s part of a massive uptick in lobbying spending in recent years. [my yellow highlighting]

Despite all its lobbying Facebook Inc is not immune from official censure for its deceptive business practices.

Take this analysis of a 2011 binding agreement between the US Federal Trade Commission and Facebook Inc.....

Federal Register / Vol. 76, No. 233 / Monday, December 5, 2011 / Notices

FEDERAL TRADE COMMISSION [File No. 092 3184], 2 December 2011:

The Federal Trade Commission has accepted, subject to final approval, a consent agreement from Facebook, Inc. (‘‘Facebook’’)……

The Commission’s complaint alleges eight violations of Section 5(a) of the FTC Act, which prohibits deceptive and unfair acts or practices in or affecting commerce, by Facebook:

* Facebook’s Deceptive Privacy Settings: Facebook communicated to users that they could restrict certain information they provided on the site to a limited audience, such as ‘‘Friends Only.’’ In fact, selecting these categories did not prevent users’ information from being shared with Apps that their Friends used.

* Facebook’s Deceptive and Unfair December 2009 Privacy Changes: In December 2009, Facebook changed its site so that certain information that users may have designated as private— such as a user’s Friend List —was made public, without adequate disclosure to users. This conduct was also unfair to users.

* Facebook’s Deception Regarding App Access: Facebook represented to users that whenever they authorized an App, the App would only access the information of the user that it needed to operate. In fact, the App could access nearly all of the user’s information, even if unrelated to the App’s operations. For example, an App that provided horoscopes for users could access the user’s photos or employment information, even though there is no need for a horoscope App to access such information. 

* Facebook’s Deception Regarding Sharing with Advertisers: Facebook promised users that it would not share their personal information with advertisers; in fact, Facebook did share this information with advertisers when a user clicked on a Facebook ad.

* Facebook’s Deception Regarding Its Verified Apps Program: Facebook had a ‘‘Verified Apps’’ program through which it represented that it had certified the security of certain Apps when, in fact, it had not. 

* Facebook’s Deception Regarding Photo and Video Deletion: Facebook stated to users that, when they deactivate or delete their accounts, their photos and videos would be inaccessible. In fact, Facebook continued to allow access to this content even after a user deactivated or deleted his or her account.

* Safe Harbor: Facebook deceptively stated that it complied with the U.S.-EU Safe Harbor Framework, a mechanism by which U.S. companies may transfer data from the European Union to the United States consistent with European law.

The proposed order contains provisions designed to prevent Facebook from engaging in practices in the future that are the same or similar to those alleged in the complaint.

Part I of the proposed order prohibits Facebook from misrepresenting the privacy or security of ‘‘covered information,’’ as well as the company’s compliance with any privacy, security, or other compliance program, including but not limited to the U.S.-EU Safe Harbor Framework. ‘‘Covered information’’ is defined broadly as ‘‘information from or about an individual consumer, including but not limited to: 

(a) A first or last name; 

(b) a home or other physical address, including street name and name of city or town; (c) an email address or other online contact information, such as an instant messaging user identifier or a screen name; 

(d) a mobile or other telephone number; 

(e) photos and videos; (f) Internet Protocol (‘‘IP’’) address, User ID, or other persistent identifier; (g) physical location; or 

(h) any information combined with any of (a) through (g) above.’’

Part II of the proposed order requires Facebook to give its users a clear and prominent notice and obtain their affirmative express consent before sharing their previously-collected information with third parties in any (a) through (g) above.’’ Part II of the proposed order requires Facebook to give its users a clear and prominent notice and obtain their affirmative express consent before sharing their previously-collected information with third parties in any way that materially exceeds the restrictions imposed by their privacy settings. A ‘‘material . . . practice is one which is likely to affect a consumer’s choice of or conduct regarding a product.’’ FTC Policy Statement on Deception, Appended to Cliffdale Associates, Inc., 103 F.T.C. 110, 174 (1984).

Part III of the proposed order requires Facebook to implement procedures reasonably designed to ensure that a user’s covered information cannot be accessed from Facebook’s servers after a reasonable period of time, not to exceed thirty (30) days, following a user’s deletion of his or her account.

Part IV of the proposed order requires Facebook to establish and maintain a comprehensive privacy program that is reasonably designed to: 

(1) Address privacy risks related to the development and management of new and existing products and services, and 

(2) protect the privacy and confidentiality of covered information. The privacy program must be documented in writing and must contain controls and procedures appropriate to Facebook’s size and complexity, the nature and scope of its activities, and the sensitivity of covered information. Specifically, the order requires Facebook to:

* Designate an employee or employees to coordinate and be responsible for the privacy program;

* Identify reasonably-foreseeable, material risks, both internal and external, that could result in the unauthorized collection, use, or disclosure of covered information and assess the sufficiency of any safeguards in place to control these risks;

* Design and implement reasonable controls and procedures to address the risks identified through the privacy risk assessment and regularly test or monitor the effectiveness of these controls and procedures;

* Develop and use reasonable steps to select and retain service providers capable of appropriately protecting the privacy of covered information they receive from respondent, and require service providers by contract to implement and maintain appropriate privacy protections; and

* Evaluate and adjust its privacy program in light of the results of the testing and monitoring, any material changes to its operations or business arrangements, or any other circumstances that it knows or has reason to know may have a material impact on the effectiveness of its privacy program.

Part V of the proposed order requires that Facebook obtain within 180 days, and every other year thereafter for twenty (20) years, an assessment and report from a qualified, objective, independent third-party professional, certifying, among other things, that it has in place a privacy program that provides protections that meet or exceed the protections required by Part IV of the proposed order; and its privacy controls are operating with sufficient effectiveness to provide reasonable assurance that the privacy of covered information is protected. Parts VI through X of the proposed order are reporting and compliance provisions. Part VI requires that Facebook retain all ‘‘widely disseminated statements’’ that describe the extent to which respondent maintains and protects the privacy, security, and confidentiality of any covered information, along with all materials relied upon in making such statements, for a period of three (3) years. Part VI further requires Facebook to retain, for a period of six (6) months from the date received, all consumer complaints directed at Facebook, or forwarded to Facebook by a third party, that relate to the conduct prohibited by the proposed order, and any responses to such complaints. Part VI also requires Facebook to retain for a period of five (5) years from the date received, documents, prepared by or on behalf of Facebook, that contradict, qualify, or call into question its compliance with the proposed order. Part VI additionally requires Facebook to retain for a period of three (3) years, each materially different document relating to its attempt to obtain the affirmative express consent of users referred to in Part II, along with documents and information sufficient to show each user’s consent and documents sufficient to demonstrate, on an aggregate basis, the number of users for whom each such privacy setting was in effect at any time Facebook has attempted to obtain such consent. Finally, Part VI requires that Facebook retain all materials relied upon to prepare the third-party assessments for a period of three (3) years after the date that each assessment is prepared. 

Part VII requires dissemination of the order now and in the future to principals, officers, directors, and managers, and to all current and future employees, agents, and representatives having supervisory responsibilities relating to the subject matter of the order. Part VIII ensures notification to the FTC of changes in corporate status. Part IX mandates that Facebook submit an initial compliance report to the FTC and make available to the FTC subsequent reports. Part X is a provision ‘‘sunsetting’’ the order after twenty (20) years, with certain exceptions.

The purpose of the analysis is to aid public comment on the proposed order. It is not intended to constitute an official interpretation of the complaint or proposed order, or to modify the proposed order’s terms in any way. 

By direction of the Commission. 

Donald S. Clark, Secretary. [FR Doc. 2011–31158 Filed 12–2–11; 8:45 am [my yellow highlighting]

When it comes to human rights and civil liberties is it ever safe to trust the junkyard dog or its political masters?

On 18 July 2017, Prime Minister Malcolm Bligh Turnbull announced the establishment of a Home Affairs portfolio that would comprise immigration, border protection, domestic security and law enforcement agencies, as well as reforms to the Attorney-General’s oversight of Australia’s intelligence community and agencies in the Home Affairs portfolio.

 On 7 December 2017, the Prime Minister introduced the Home Affairs and Integrity Agencies Legislation Amendment Bill2017 into the House of Representatives.

This bill amends the Anti-Money Laundering and Counter-Terrorism Financing Act 2006, the Independent National Security Legislation Monitor Act 2010, the Inspector-General of Intelligence and Security Act 1986 and the Intelligence Services Act 2001.

The bill was referred to Parliamentary Joint Committee on Intelligence and Security which tabled its report and recommendations on 26 February 2018.

This new government department on steroids will be headed by millionaire former Queensland Police detective and far-right Liberal MP for Dickson, Peter Craig Dutton.

His 'front man' selling this change is Abbott protégé, former Secretary of the Department of Immigration and Border Protection and current Secretary of the new Department of Home Affairs, Michael Pezzullo. 

The question every Australian needs to ask themselves is, can this current federal government, the ministers responsible for and department heads managing this extremely powerful department, be trusted not to dismantle a raft of human and civil rights during the full departmental implementation.

It looks suspiciously as though former Australian attorney-general George Brandis does not think so - he is said to fear political overreach.

The Saturday Paper, 3-9 March 2018:

On Friday last week, former attorney-general George Brandis went to see Michael Pezzullo, the secretary of the new Department of Home Affairs.

The meeting was a scheduled consultation ahead of Brandis’s departure for London to take up his post as Australia’s new high commissioner. It was cordial, even friendly. But what the soon-to-be diplomat Brandis did not tell Pezzullo during the pre-posting briefing was that he had singled him out in a private farewell speech he had given to the Australian Security Intelligence Organisation on the eve of his retirement from parliament two weeks earlier.

As revealed in The Saturday Paper last week, the then senator Brandis used the ASIO speech to raise concerns about the power and scope of the new department and the ambitions of its secretary. Brandis effectively endorsed the private concerns of some within ASIO that the new security structure could expose the domestic spy agency to ministerial or bureaucratic pressure.

In a regular Senate estimates committee hearing this week, Pezzullo described his meeting with Brandis – on the day before The Saturday Paper article appeared – as Opposition senators asked him for assurances that ASIO would retain its statutory independence once it moves from the attorney-general’s portfolio to become part of Home Affairs.

“I had a very good discussion on Friday,” Pezzullo told the committee, of his meeting with Brandis.

“He’s seeking instructions and guidance on performing the role of high commissioner. None of those issues came up, so I find that of interest. If he has concerns, I’m sure that he would himself raise those publicly.”

Labor senator Murray Watt pressed: “So he raised them with ASIO but not with you?”

“I don’t know what he raised with ASIO,” Pezzullo responded. “… You should ask the former attorney-general if he’s willing to state any of those concerns … He’s a high commissioner now, so he may not choose to edify your question with a response, but that’s a matter for him. As I said, he didn’t raise any of those concerns with me when we met on Friday.”

The Saturday Paper contacted George Brandis but he had no comment.

“ANY SUGGESTION THAT WE IN THE PORTFOLIO ARE SOMEHOW EMBARKED ON THE SECRET DECONSTRUCTION OF THE SUPERVISORY CONTROLS WHICH ENVELOP AND CHECK EXECUTIVE POWER ARE NOTHING MORE THAN FLIGHTS OF CONSPIRATORIAL FANCY…”

Watt asked Pezzullo for assurance there would be no change to the longstanding provisions in the ASIO Act that kept the agency under its director-general’s control and not subject to instruction from the departmental secretary. The minister representing Home Affairs in the Senate, Communications Minister Mitch Fifield, said: “It is not proposed that there be a change to that effect.”

The new Department of Home Affairs takes in Immigration and Border Protection, the Australian Federal Police, the Australian Criminal Intelligence Commission, the Australian Transaction Reports and Analysis Centre, known as AUSTRAC, and ASIO.

ASIO does not move until legislation is passed to authorise the shift, and will retain its status as a statutory agency.

Pezzullo addressed the fears of those questioning his department’s reach. He said some commentary mischaracterised the arrangements as “being either a layer of overly bureaucratic oversight of otherwise well-functioning operational arrangements or, worse, a sinister concentration of executive power that will not be able to be supervised and checked”.

“Both of these criticisms are completely wrong,” he said.

Pezzullo had already described his plans, both to the committee and in a speech he made in October last year, in which he spoke of exploiting the in-built capabilities in digital technology to expand Australia’s capacity to detect criminal and terrorist activity in daily life online and on the so-called “dark web”.

But the language he used, referring to embedding “the state” invisibly in global networks “increasingly at super scale and at very high volumes”, left his audiences uncertain about exactly what he meant.

Watt asked if there would be increased surveillance of the Australian people. “Any surveillance of citizens is always strictly done in accordance with the laws passed by this parliament,” Pezzullo replied.

In his February 7 speech to ASIO, George Brandis described Pezzullo’s October remarks as an “urtext”, or blueprint, for a manifesto that would rewrite how Australia’s security apparatus operates.

Pezzullo hit back on Monday. “Any suggestion that we in the portfolio are somehow embarked on the secret deconstruction of the supervisory controls which envelop and check executive power are nothing more than flights of conspiratorial fancy that read into all relevant utterances the master blueprint of a new ideology of undemocratic surveillance and social control,” Pezzullo said.

As for day to day human resources, financial management and transparent accountable governance, media reports are not inspiring confidence in Messrs. Turnbull, Dutton and Pezzullo.

The Canberra Times, 2 March 2018:

Home Affairs head Mike Pezzullo was one of the first to front Senate estimates on Monday.

It's been up and running for only weeks, but his new department is part of one of the largest government portfolios.

Having brought several security agencies into its fold, and if legislation passes letting ASIO join, the Home Affairs portfolio will be home to 23,000 public servants. 

Mr Pezzullo was also quizzed on the investigation into Roman Quaedvlieg, the head of the Australian Border Force who has been on leave since May last year, following claims he helped his girlfriend - an ABF staff member - get a job at Sydney Airport.

It was revealed the Prime Minister's department has had a corruption watchdog's report into abuse of power allegations for at least five months while Mr Quaedvlieg has been on full pay earning hundreds of thousands of dollars.

US President Trump censors House Permanent Select Committee on Intelligence minority memo concerning FBI Russia investigation before releasing it for publication

Democratic Rebuttal to GOP FISA Memo by PBS NewsHour on Scribd

https://www.scribd.com/document/372311495/Democratic-Rebuttal-to-GOP-FISA-Memo

US Dept of Justice-FBI investigation of Russian links to Donald Trump's election campaign inexorably rolls on

On 17 May 2017 the probe into Russian influence on US political processes and collusion between the Russian Government and individuals associated with the election campaign of President Donald J Trump became an investigation which would inevitably lead to charges being laid.

To date both President Trump's former campaign manager and campaign deputy-director have been indicted, along with thirteen Russian nationals and three corporations.

Trump's former security adviser, along with a former member of his foreign policy advisory team and an individual who unlawfully supplied US bank accounts to Russians associated with the alleged political interference, have plead guilty to charges.

Current State of Play according to US Dept. of Justice

U.S. v. Internet Research Agency, et al (1:18-cr-32, District of Columbia)

A federal grand jury in the District of Columbia returned an indictment on Feb. 16, 2018, against 13 Russian nationals and three Russian entities accused of violating U.S. criminal laws in order to interfere with U.S. elections and political processes. The indictment charges all of the defendants with conspiracy to defraud the United States, three defendants with conspiracy to commit wire fraud and bank fraud, and five defendants with aggravated identity theft.

Indictment 

U.S. v. Richard Pinedo, et al (1:18-cr-24, District of Columbia)

Richard Pinedo, of Santa Paula, Calif., pleaded guilty on Feb. 12, 2018, to identity fraud, in violation of 18 U.S.C. 1028.

Criminal Information

Plea Agreement

Statement of Offense

U.S. v. Michael T. Flynn (1:17-cr-232, District of Columbia)

Lieutenant General Michael T. Flynn (Ret.), of Alexandria, Va., pleaded guilty on Dec. 1, 2017, to making false statements to FBI agents, in violation of 18 U.S.C. 1001.

Criminal Information

Plea Agreement

Statement of the Offense

U.S. v. Paul J. Manafort, Jr., and Richard W. Gates III (1:17-cr-201, District of Columbia)

Paul J. Manafort, Jr., of Alexandria, Va., and Richard W. Gates III, of Richmond, Va., have been indicted by a federal grand jury on Oct. 27, 2017, in the District of Columbia. The indictment contains 12 counts: conspiracy against the United States, conspiracy to launder money, unregistered agent of a foreign principal, false and misleading FARA statements, false statements, and seven counts of failure to file reports of foreign bank and financial accounts. The case was unsealed on Oct. 30, 2017, after the defendants were permitted to surrender themselves to the custody of the FBI.

Indictment

U.S. v. George Papadopoulos (1:17-cr-182, District of Columbia)

George Papadopoulos, of Chicago, Illinois, pleaded guilty on Oct. 5, 2017, to making false statements to FBI agents, in violation of 18 U.S.C. 1001. The case was unsealed on Oct. 30, 2017.

Criminal Information

Plea Agreement

Statement of the Offense

UPDATE

U.S. v. Alex van der Zwaan (1:18-cr-31, District of Columbia)

Alex van der Zwaan, of London, pleaded guilty on Feb. 20, 2018, to making false statements to FBI agents, in violation of 18 U.S.C. 1001.

Criminal Information

Plea Agreement

Statement of the Offense

U.S. v. Paul J. Manafort, Jr., and Richard W. Gates III (1:18-cr-83, Eastern District of Virginia)

Paul J. Manafort, Jr., of Alexandria, Va., and Richard W. Gates III, of Richmond, Va., were indicted by a federal grand jury on Feb. 22, 2018, in the Eastern District of Virginia. The indictment contains 32 counts: 16 counts related to false individual income tax returns, seven counts of failure to file reports of foreign bank and financial accounts, five counts of bank fraud conspiracy, and four counts of bank fraud.

Indictment

U.S. v. Paul J. Manafort, Jr. (1:17-cr-201, District of Columbia)

A federal grand jury in the District of Columbia returned a superseding indictment on Feb. 23, 2018, against Paul J. Manafort, Jr., 68, of Alexandria, Va. The superseding indictment contains five counts: conspiracy against the United States, conspiracy to launder money, unregistered agent of a foreign principal, false and misleading FARA statements, and false statements.

Superseding Indictment

U.S. v. Richard W. Gates III (1:17-cr-201, District of Columbia)

Richard W. Gates III, 45, of Richmond, Va., pleaded guilty on Feb. 23, 2018, to a superseding criminal information that includes: count one of the indictment, which charges conspiracy against the United States, in violation of 18 U.S.C. 371 (which includes conspiracy to violate 26 U.S.C. 7206(1), 31 U.S.C. 5312 and 5322(b), and 22 U.S.C. 612, 618(a)(1), and 618(a)(2)), and a charge of making false statements to the Special Counsel’s Office and FBI agents, in violation of 18 U.S.C. 1001. A status report with regard to sentencing was scheduled for May 14, 2018.

Superseding Criminal Information

Plea Agreement

Statement of the Offense

Failed coal seam gas mining company Linc Energy's 9 week trial underway in Queensland, Australia

As the story unfolded.........

ABC News, 16 April 2016:

Oil and gas company Linc Energy has been placed into administration in a bid to avoid penalties for polluting the environment, a Queensland green group says.

It was announced late Friday that administrators PPB Advisory had been called in to work with Linc's management on options including a possible restructure.

In a statement to the ASX, the company said after receiving legal and financial advice and considering commercial prospects the board decided it was in the best interests of the company to make the move.

It comes one month after the company was committed to stand trial on five charges relating to breaches in Queensland's environmental laws at its underground coal gasification site.

The state's environment department accused the company of wilfully causing serious harm at its trial site near Chinchilla on the Darling Downs.

Drew Hutton from the Lock the Gate Alliance said the company could face up to $56 million in fines if found guilty, but the penalty might never be paid.

"It is going to be difficult to get any money out of this company now that it is in administration," he said.

Mr Hutton said going into administration was a common legal manoeuvre to dodge fines and costly clean-ups......

Queensland Government, Dept. of Environment and Heritage Protection, 29 January 2018:

Environmental Protection Order directed to Linc

Prior to Linc entering liquidation, DES issued Linc with an Environmental Protection Order (EPO) which required it to retain critical infrastructure on-site, conduct a site audit and undertake basic environmental monitoring to characterise the current status of the site.

Linc’s liquidators launched a legal challenge associated with this EPO in the Supreme Court seeking orders that they were justified in not causing Linc to comply with the EPO (or any future EPO). DES opposed this application.

In April 2017, the Supreme Court directed that Linc’s liquidators are not justified in causing Linc not to comply with the EPO. The Court accepted DES’ argument that the relevant provisions of the EP Act prevail over the Commonwealth Corporations Act and that Linc’s liquidators are executive officers of the company. Subject to any appeal decision, this confirms DES’s ability to enforce compliance with environmental obligations owed by resource companies who have gone into administration or liquidation.

Linc’s liquidators have since appealed the decision to the Court of Appeal. This appeal was heard in September 2017 and the decision was reserved.

Environmental Protection Order directed to a related person of Linc

DES used the ‘chain of responsibility’ amendments to the EP Act to issue an EPO to a ‘related person’ of Linc. The EPO requires the recipient to take steps to decommission most of the site’s dams and provide a bank guarantee of $5.5 million to secure compliance with the order.

The recipient of the EPO has appealed to the Planning and Environment Court and that litigation is ongoing.

The recipient of the EPO also applied for an order that the appeal be allowed and the EPO be set aside on the basis that DES denied him procedural fairness. The Planning and Environment Court dismissed that application. The recipient of the EPO appealed that decision to the Court of Appeal. That appeal was heard in March 2017 and judgment in favour of DES was delivered in August 2017. Subject to any further appeal, this decision confirms that the recipient was not denied procedural fairness and that DES’ interpretation of the EP Act was correct.

The earlier appeal in relation to the EPO (regarding the substance of the document) is yet to be heard by the Planning and Environment Court.

Investigation and prosecution of Linc and former executives

Linc Energy Limited will stand trial in the Brisbane District Court, commencing 29 January 2018, on five counts of wilfully causing serious environmental harm, in contravention of the Environmental Protection Act 1994.

All counts relate to operations at the Linc Energy underground coal gasification site near Chinchilla, from approximately 2007 to 2013, and allege that contaminants were allowed to escape as a result of the operation.

In addition, the Queensland Government has charged five former Linc Energy executives over the operation of the UCG site in Chinchilla. A committal hearing in the Brisbane Magistrates Court is expected to take place in mid-2018.

As these matters remain before the courts, DES is unable to comment further on the legal proceedings.

Media releases

11 March 2016—Linc Energy committed for trial

ABC News, 30 January 2018:

A landmark case described by a District Court judge as "unusual" will hear how gas company Linc Energy allegedly contaminated strategic cropping land causing serious environmental damage to parts of Queensland's Western Downs.

Linc Energy is charged with five counts of wilfully and unlawfully causing environmental harm between 2007 and 2013 at Chinchilla.

The charges relate to alleged contamination at Linc Energy's Hopeland underground coal gasification (UCG) plant.

The trial will enter its second day today in the District Court in Brisbane, with crown prosecutor Ralph Devlin QC expected to begin his opening address to the empanelled jury later this morning.

Former Linc Energy scientists, geologists, and engineers as well as several investigators from the Queensland Environment Department are among those expected to give evidence.

Echo NetDaily, 30 January 2018:

BRISBANE, AAP – A failed energy company accused of knowingly and illegally polluting a significant part of Queensland’s Darling Downs has faced trial in a landmark criminal case in Brisbane.

Linc Energy is charged with five counts of wilfully and unlawfully causing environmental harm between 2007 and 2013 after allegedly allowing toxic gas to leak from its operations.

The Brisbane District Court trial has heard Linc’s four underground coal gasification (UCG) sites and water were polluted to the point it was unfit for stock to consume but the company kept operating.

Crown prosecutor Ralph Devlin QC told the jury the company allowed hazardous contaminants to spread even after scientists and workers warned about gases bubbling from the ground.

Linc operated four UCG sites in Chinchilla where it burnt coal underground at very high temperatures to create gas.

In his opening address on Tuesday, Mr Devlin said scientists warned senior managers about the risk environmental harm was being caused throughout the operation…..

 ‘Bond prioritised Linc’s commercial interests over the requirements of operating its mining activity in an environmentally safe manner,’ Mr Devlin said.

‘Linc did nothing to stop, mitigate or rehabilitate the state of affairs that Linc itself had caused.’

As part of the UCG process, Linc injected air into the ground, which created and enlarged fractures.

It tried to concrete surface cracks and use wells to control pressure but they didn’t sufficiently reduce risks or damage, the court heard.

‘Linc kept going, even knowing the measures weren’t working,’ Mr Devlin said.

Scientists who visited the site are due to give evidence during the nine-week trial, but no senior managers from the company, which is in liquidation, will take the stand.

The trial continues.

ABC News, 8 February 2018:

Workers at an underground coal gasification plant on Queensland's Western Darling Downs were told to drink milk and eat yoghurt to protect their stomachs from acid, a court has heard.

The gas company has pleaded not guilty to five counts of causing serious environmental harmfrom its underground coal gasification operations between 2007 and 2013 in Chinchilla.

The corporation is not defending itself as it is in liquidation so there is no-one in the dock or at the bar table representing the defence.

A witness statement by former gas operator Timothy Ford was read to the court, which he prepared in 2015 before his death.

The court was not told how Mr Ford died.

He said the gas burnt his eyes and nose and he would need to leave the plant after work to get fresh air because it made him feel sick.

"We were told to drink milk in the mornings and at the start of shift… we were also told to eat yoghurt," he said.

"The purpose of this was to line our guts so the acid wouldn't burn our guts.

"We were not allowed to drink the tank water and were given bottled water."

Mr Ford said he always felt lethargic, suffered infections and had shortness of breath.

"During my time at the Linc site, would be the sickest I have been," he said.

"It is my belief that workplace was causing my sickness.

"I strongly feel that the Linc site was not being run properly due to failures of the wells and gas releases.".....

Sunshine Coast Daily, 9 February 2018:

A CONCRETE pumper says he saw 'black tar' seeping up at a Linc Energy site and raised concerns with the company.

Robert Arnold has told a court he noticed some odd occurrences when he went to the Chinchilla site in late 2007……

On Thursday, Mr Arnold told jurors he noticed several phenomena at the site.

"We saw bubbles coming up ... and a black tar substance. We commented back to Linc about it."

"A few of us went over and had a look ... basically it just looked like a heavy black oil ... it was in the puddles as well, in the same area," Mr Arnold added.

"We couldn't place our equipment close to the well because of these overhead pipes ... it was dripping out of the joints."

Prosecutor Ralph Devlin earlier claimed a "bubbling" event happened on the ground after rainfall at the coal gasification site.

Mr Arnold told jurors that after discussing the oozing substance, concrete trucks turned up and he pumped the concrete into a well.

Mr Arnold said he felt the concrete used that time was "very light" but the on-site supervisor made that decision.

Prosecutors previously told the court concerns were raised at various times with Linc leadership about the quality of cement and geological data used at the site.

The Crown has also claimed Linc used its underground wells in a way that made them fail, and allowed contaminants to escape far way, to places Linc could not remove them.

BACKGROUND

Wikipedia, 5 February 2018:

Linc started its Chinchilla Demonstration Facility in July 1999. First gas was produced in that very same year. Initially Linc Energy used the underground coal gasification technology worked out by Ergo Exergy Technologies, Inc, of Canada. 

However, in 2006 the cooperation with Ergo Exergy was terminated and the cooperation agreement for technology usage, consultation and engineering services was signed with the Skochinsky Institute of Mining and the Scientific-Technical Mining Association of Russia.[2]

In 2005, Linc signed a memorandum with Syntroleum granting a licence to use the Syntroleum's proprietary gas-to-liquid technology and started to build a GTL pilot plant in November 2007 at the Chinchilla facility. The plant was commissioned in August 2008. The first synthetic crude was produced in October 2008.[3]