Security News: Assistant Attorney General Kristen Clarke Delivers Remarks at the National Action Network Annual Convention’s Women’s Empowerment Luncheon

Source: United States Department of Justice News

Remarks as Prepared

Thank you, for that kind introduction and for the invitation to speak here this afternoon. It is always wonderful to be back in my hometown with the National Action Network.

I’m particularly honored to be together during this historic week when the first Black woman in American history is expected be confirmed to the United States Supreme Court.

Seeing Judge Ketanji Brown Jackson become Supreme Court Justice Ketanji Brown Jackson is a moment I hope we all savor. Of course, representation alone is never sufficient to make progress. But it is always, always necessary.

As the first Senate-confirmed Black woman to lead the Department of Justice’s Civil Rights Division, I know that all too well. Each step along my journey was paved by the women – especially the Black women – who came before me.

None of us got where we are today on our own. I know I didn’t. I stand on the shoulders of giants. One of those giants is a woman named Constance Baker Motley, a key strategist of the Civil Rights Movement and the first Black woman to serve as a federal judge.

I think about Judge Motley a lot because the two of us have a lot in common. We’re both children of Caribbean immigrants. We both grew up in the Northeast. We both worked for the NAACP Legal Defense Fund. But there is one way in which our lives were profoundly different. I was fortunate enough to grow up in a time when I could look up to a woman like Judge Motley. I could see the path she blazed and know that I could do that, too.

Judge Motley may not have the name recognition of other civil rights leaders, but her work was critical. She helped lead the fight to desegregate colleges, public schools, and public amenities; to ensure equal pay for Black teachers; to include Black people in juries; and to protect all Americans’ right to peacefully protest.

For generations, Black women like Judge Motley have been the backbone of the movement for justice. I work hard every day to uphold that legacy at the Department of Justice.

And let me tell you, the threats to our basic constitutional rights are real and they are urgent. We are at a critical moment. As a mother, I see the future of America through the eyes of my son. And, honestly, I am at times worried.

Will he have full and equal access to the extraordinary opportunities of American life? Will he be able to embrace those opportunities in safety and dignity? Will all of America’s children be able to do the same?

I keep those questions close to my heart. There is no doubt that we are facing profound challenges in our nation. But we are facing them together.

In the summer of 2020, millions of Americans of all ages, races and creeds took to the streets to demand justice – justice for George Floyd, yes, but also to build a new foundation of racial justice in America. I am and never have been under any illusion that America has struggled to live up to the promise of her ideals. But it is up to all of us to push this nation closer to those ideals – without limit or fear.

For me, that work begins with voting rights. I came up as a voting rights attorney. That’s been my life’s work. And I feel privileged and humbled to be heading the Civil Rights Division at this moment of profound challenge for our democracy.

In his famous “Give us the ballot” speech, Dr. Martin Luther King Jr. acknowledged that voting alone isn’t enough – that we must use the power of the ballot to spark real change. But he also knew that without that power to vote, justice is impossible.

The Department of Justice is committed to making sure that all eligible voters can cast a vote; that all lawful votes are counted; and that every voter has access to accurate election information. We have taken action across the country and we will not stop doing all that we can to safeguard the right to vote.

The division also recently issued significant guidance documents, which provide our formal legal interpretation of certain voting rights laws. One provides guidance on federal laws that affect methods of voting, including early voting and voting by mail, and last month, we released guidance that helps election officials ensure that ballot drop boxes are accessible to voters with disabilities. Another lays out the protections against racial vote dilution under Section 2 of the Voting Rights Act that apply nationwide to the redistricting cycle that is now underway.

The Department of Justice will use all the tools it has available to ensure that each eligible citizen can register, cast a ballot and have that ballot counted free from racial discrimination.

But I have to admit we are fighting without our most effective tool. The Supreme Court’s 2013 decision in Shelby County v. Holder eliminated preclearance, the single most powerful and effective enforcement mechanism we had to protect the right to vote. That is why it is imperative that Congress pass the John Lewis Voting Rights Act to finally ensure every American can participate in our democracy.

When talking about voting, I often am drawn back to a quote from President Lyndon B. Johnson: “A [wo]man without a vote is a [wo]man without protection.” While President Johnson’s statement was focused on the voting rights of men— I have improved on his original statement — but I think he summarizes precisely what is at stake. If people cannot access the ballot, then the state of our fundamental rights will always be vulnerable.

Racial justice must also extend to the communities in which we live. For many people in marginalized communities, however, simply walking through their neighborhood may not feel safe amid the surge of hate crimes in recent years.

FBI statistics show that, show that, during the pandemic, there was a rise in hate crimes committed against Black Americans, already the group most often targeted. Anti-Asian violence has also risen by over 70%. Tragically, we have seen some of the most disturbing crimes in this very city.

Attacks on people because of their race, national origin, religion, gender or sexual orientation are unacceptable. Attorney General Merrick Garland’s very first directive in office was to determine how the department could deploy all the tools at our disposal to counter this rise in hate crimes.

The division that I lead serves as the prosecutors of federal hate crimes. We have significantly stepped up our prosecution of these cases, including securing guilty verdicts on hate crime charges against the three men who killed Ahmaud Arbery.

The evidence at trial revealed that the defendants had strongly held racist beliefs that led them to make assumptions and decisions about Mr. Arbery because he was Black. For instance, the evidence showed that one defendant had referred to his daughter’s Black boyfriend as a “monkey” and used the “n-word” that a second had made deeply racist comments, including that he wished that Julian Bond, a prominent Black civil rights leader, “had been put in the ground years ago,” and that “those Blacks are nothing but trouble,” and that the third had expressed on social media and in text messages that he associated Black people with criminality and wanted to see them harmed or killed.

The tragic killing of Ahmaud Arbery illustrates why robust enforcement of our federal hate crimes laws is essential. Enforcing hate crimes laws sends a powerful message to those who are affected, and to the broader community: that they are valued, that their communities are important, and that the federal government will not stand by idly when they are targeted.

But we know that work to confront hate in this era requires that we use every tool available to us. That is why the department is also hard at work maximizing the use of our non-criminal resources to address acts of bias where appropriate. For example, in October 2021, the Civil Rights Division and the United States Attorney’s Office for Utah announced a settlement agreement with the Davis School District in Utah to address race discrimination in the district’s schools, including serious and widespread racial harassment of Black and Asian American students. Our investigation in that case revealed persistent failures to respond to reports of race-based harassment of Black and Asian American students, by district staff and other students. Between 2015 and 2020, the department found hundreds of documented uses of the “N-word,” among other racial epithets, derogatory racial comments, and physical assaults targeting district students at dozens of schools. The investigation also showed that the school district disciplined Black students more harshly than their white peers for similar behavior. The department’s resolution of this case requires the school district to enact significant institutional reforms to address discrimination and protect vulnerable students.

Racial justice also requires that the people are able to trust the police who serve them. That is why my division has worked to hold individual police officers accountable for misconduct. In the past this year, we secured convictions of four former Minneapolis police officers for federal civil rights violations in the death of George Floyd. Those convictions sent a clear message to police departments across the country that they must use only reasonable force and that they have a proactive duty to protect the constitutional rights of all Americans.

And where there is evidence of systemic violations of civil rights laws, we have tools available to address that pattern of misconduct as well. These investigations are formally known as “pattern or practice investigations,” and they reflect a unique and critically important authority vested in the Department of Justice. In the last year, the department has opened pattern or practice investigations of the police departments in Louisville, Minneapolis, Phoenix and Mount Vernon, New York. That work is ongoing.

Ensuring police are held accountable to the people they serve will remain a top priority of the Department of Justice and the Civil Rights Division.

We are also dedicated to ensuring economic justice by enforcing federal civil rights laws that protect fair housing, equal employment opportunity and the rights of people with disabilities.

Earlier this year, the division filed another statement of interest in an ongoing lawsuit where the plaintiffs, a Black couple, sought to refinance their home. When the appraiser visited their home the first time it was valued around a million dollars. However, a few weeks later, they had their house re-appraised but this time with their white friend posing as the homeowner. The same exact house, was now appraised nearly a half million dollars more. This discrimination is prohibited under the Fair Housing Act and the division, and the division is determined to protect communities of color and ensure economic justice.

Relatedly, we are committed to tackling the pervasive problem of redlining, which remains a major historic and present-day driver of racial wealth disparities. You may know that the term “redlining” originates with actual red lines drawn on maps that identified predominantly-Black neighborhoods as “hazardous.” Starting in the 1930s, government-sponsored programs and private lenders used these maps and related practices to deny credit to neighborhoods because of their racial demographics. This formalized a system that significantly limited homeownership opportunities for communities of color.

Federal laws like the Fair Housing Act and the Equal Credit Opportunity Act were intended to help address this history of housing segregation and discriminatory lending practices. But the battle to combat redlining is ongoing.

This is why the Justice Department launched a new initiative to investigate lenders across the country and analyze whether they are engaging in unlawful redlining. The Combatting Redlining Initiative represents the department’s most aggressive and coordinated effort yet to address this problem. To date, the department has resolved redlining allegations against Trustmark National Bank in Memphis and Cadence Bank in Houston. Collectively these two banks will invest over $10 million to increase credit opportunities to residents of those neighborhoods. While there is more to do, we are committed to the task.

Let me be clear: none of this is easy. And none of the rights and protections we have should be taken for granted.

I am sometimes struck that the Civil Rights Division that I now oversee did not always exist. It’s nearly 65 years old and was borne of the activism and organizing of the early Civil Rights Movement. The division was created as part of the Civil Rights Act of 1957 – a bill so sweeping that New York’s own Adam Clayton Powell Jr called it, quote, “the second emancipation.”

Justice is built one brick at a time. And it can be dismantled the same way. When it comes to ensuring equal justice in America, we are on the case.

I want to thank you again for having me here to speak with you today. It is an extraordinary honor to talk to so many passionate, successful Black women. It reminds me of a quote from the great Constance Baker Motley, the civil rights leader and federal judge I spoke about earlier.

When asked about how she felt having to face so many systemic and institutional barriers, she said, “The lack of encouragement never deterred me. I was the kind of person who would not be put down.”

That’s the spirit I seek to reflect as I lead the Civil Rights Division. I will not be put down. The incredibly talented people on my team will not be put down. And the millions of Americans demanding equal justice will not be put down.

I’m proud to stand with you all in this vital, urgent work. Thank you again for having me here today.

Security News: Member of Hacking Group Sentenced for Scheme that Compromised Tens of Millions of Debit and Credit Cards

Source: United States Department of Justice News

Damage to Banks, Merchants, Card Companies, and Consumers Estimated at more than $1 Billion

A Ukrainian man was sentenced today in the Western District of Washington to five years in prison for his criminal work in the hacking group FIN7.

According to court documents, Denys Iarmak, 32, served as a high-level hacker, whom the group referred to as a “pen tester,” for FIN7. He was arrested in Bangkok, Thailand, in November 2019 at the request of U.S. law enforcement. Iarmak is the third member of the FIN7 group to be sentenced in the United States. On April 16, 2021, FIN7 member Fedir Hladyr was sentenced to 10 years in prison. On June 24, 2021, FIN7 member Andrii Kolpakov was sentenced to seven years in prison.

In the United States alone, FIN7 successfully breached the computer networks of businesses in all 50 states and the District of Columbia, stealing more than 20 million customer card records from over 6,500 individual point-of-sale terminals at more than 3,600 separate business locations. According to court documents, victims incurred enormous costs that, according to some estimates, exceeded $1 billion dollars. Additional intrusions occurred abroad, including in the United Kingdom, Australia, and France. Companies that have publicly disclosed hacks attributable to FIN7 include such chains as Chipotle Mexican Grill, Chili’s, Arby’s, Red Robin, and Jason’s Deli.  

“Iarmak and his conspirators compromised millions of financial accounts, causing over a billion dollars in losses to Americans and costs to America’s economy,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “Protecting businesses – both large and small – online is a top priority for the Department of Justice. We are committed to working with our international partners to hold such cyber criminals accountable, no matter where they live or how anonymous they think they are.”

“Iarmak was directly involved in designing phishing emails embedded with malware, intruding on victim networks, and extracting data such as payment card information,” said U.S. Attorney Nicholas W. Brown of the Western District of Washington. “To make matters worse, he continued his work with the FIN7 criminal enterprise even after the arrests and prosecution of co-conspirators. He and others in this cybercrime group used hacking techniques to essentially rob thousands of locations of multiple restaurant chains at once, from the comfort and safety of their keyboards in distant countries.”

“This cyber-criminal probed and mapped victims networks searching for data to exploit,” said Special Agent in Charge Donald M. Voiret of the FBI’s Seattle Field Office. “Masquerading as a legitimate business, the hacking group he belonged to recruited other members to assist with their criminal activities. Thanks to the hard work of law enforcement, this defendant, who is responsible for an enormous loss amount, will be spending the next few years in prison.”

According to court documents, since at least 2015, members of FIN7 (also referred to as Carbanak Group and the Navigator Group, among other names) engaged in a highly sophisticated malware campaign to attack hundreds of U.S. companies, predominantly in the restaurant, gambling, and hospitality industries. FIN7 hacked into thousands of computer systems and stole millions of customer credit and debit card numbers that were then used or sold for profit. FIN7, through its dozens of members, launched waves of malicious cyberattacks on numerous businesses operating in the United States and abroad. To execute its scheme, FIN7 carefully crafted email messages that would appear legitimate to a business’ employees and accompanied emails with telephone calls intended to further legitimize the emails. Once a file attached to a fraudulent email was opened and activated, FIN7 would use an adapted version of the Carbanak malware, in addition to an arsenal of other tools, to access and steal payment card data for the business’s customers. Since 2015, many of the stolen payment card numbers have been offered for sale through online underground marketplaces.

Iarmak was involved with FIN7 from approximately November 2016 through November 2018. Iarmak frequently used project management software such as JIRA, hosted on private virtual servers in various countries, to coordinate FIN7 malicious activity and to manage the assorted network intrusions. JIRA is a project management and issue-tracking program used by software development teams. JIRA allows team members to create “projects” containing posted “issues” under which other team members can make comments and share data. Under each issue, FIN7 members tracked their progress breaching a victim’s security, uploaded data stolen from the victim, and provided guidance to each other. As one example, Iarmak created a JIRA issue, to which he and other members of the cybergroup had access, for a specific victim company, and, on or about March 3, 2017, Iarmak updated that JIRA and uploaded data he had stolen from that company. During the course of the scheme, Iarmak received compensation for his participation in FIN7, which far exceeded comparable legitimate employment in Ukraine. Moreover, FIN7 members, including Iarmak, were aware of reported arrests of other FIN7 members, but nevertheless continued to attack U.S. businesses.

Iarmak initially fought extradition but in February 2020 he consented to extradition in a Thai court. In May 2020 he was transferred to U.S. custody. In November 2021, Iarmak pleaded guilty to one count of conspiracy to commit wire fraud and one count of conspiracy to commit computer hacking.

This case is the result of an investigation conducted by the FBI’s Seattle Cyber Task Force. The Justice Department’s Office of International Affairs, the National Cyber-Forensics and Training Alliance, numerous computer security firms and financial institutions, FBI offices across the nation and globe, as well as a number of international agencies provided significant assistance. Thailand law enforcement authorities provided significant assistance by arresting Iarmak.

This case was prosecuted by Assistant U.S. Attorney Steven Masada of the Western District of Washington and Trial Attorney Anthony Teelucksingh of the Criminal Division’s Computer Crime and Intellectual Property Section.

Security News: Former Congressional Staffer Pleads Guilty to Theft of Public Funds

Source: United States Department of Justice Criminal Division

A former Congressional staffer pleaded guilty today to theft of public funds in connection with his scheme to fraudulently inflate his salary and bonus payments, thereby paying himself more than he was legitimately owed. 

According to court documents, Sterling Carter, 24, of Glenwood, Georgia, was employed as the Director of Operations by a Member of Congress. In that position, Carter was responsible for managing the office’s budget and processing payroll and bonus payments for all employees in the office. Between November 2019 and January 2021, Carter submitted fraudulent paperwork which purported to authorize a higher salary and bonus payments for himself. Carter concealed this theft from the Congressperson and the office’s Chief of Staff by falsely representing, in both communications and a budget spreadsheet, that he was only being paid what he was legitimately owed. In total, Carter received $79,491.67 in unauthorized salary and bonus payments.  

Carter pleaded guilty in the U.S. District Court for the District of Columbia to theft of public funds. Carter will be sentenced on July 28 and faces up to 10 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Matthew M. Graves for the District of Columbia; and Assistant Director in Charge Steven M. D’Antuono of the FBI’s Washington Field Office made the announcement.

The FBI investigated this matter. Trial Attorneys Nicole Lockhart and Jordan Dickson of the Criminal Division’s Public Integrity Section and the Fraud, Public Corruption, and Civil Rights Section of the U.S. Attorney’s Office for the District of Columbia are prosecuting the case.

Security News: Seymour Manufacturing Company Pays $2.4 Million for Violating Clean Water Act

Source: United States Department of Justice News

Leonard C Boyle, United States Attorney for the District of Connecticut, Tyler Amon, Special Agent in Charge of EPA’s Criminal Investigation Division for New England, and Commissioner Katie Scharf Dykes of the Connecticut Department of Energy and Environmental Protection announced that MARMON UTILITY LLC was sentenced today by U.S. District Judge Kari A. Dooley in Bridgeport for violating the Clean Water Act by knowingly failing to properly operate and maintain the industrial wastewater treatment system and sludge-processing equipment at the Kerite Power Cable & Pump Cable factory located at 49 Day Street in Seymour, Connecticut.  Marmon Utility LLC (“Marmon Utility”), a subsidiary of Berkshire Hathaway, owns and operates the factory.

Judge Dooley ordered that Marmon Utility will be under federal probation for three years and must pay $2.4 million to the government: $800,000 as a federal penalty and a $1.6 million community service payment to remediate the Naugatuck River, as administered by the Connecticut Department of Energy and Environmental Protection (“CT DEEP”).  Marmon Utility pleaded guilty to the offense on December 21, 2021.

According to court documents and statements made in court, the Kerite Power Cable & Pump Cable (“Kerite”) factory in Seymour manufactures large power cables and generates industrial wastewater containing heavy metals such as lead and zinc.  Under its 2015 CT DEEP permit, Marmon Utility was required to properly operate and maintain the wastewater treatment system at the factory to reduce the heavy-metal content by chemical precipitation before the wastewater could be discharged to the sewage treatment plant. 

The investigation revealed that Marmon Utility had been cutting back on its environmental compliance program for many years, and had not had an employee with an environmental background running its wastewater treatment system since February 2004.  When the operator of the wastewater treatment system became ill in March 2016, Marmon Utility ran the system for at least five months with maintenance employees who lacked environmental training and training on the treatment system. 

On September 7 and 8, 2016, the superintendent of the Seymour treatment plant observed unusual, rusty brown wastewater flowing into the plant and notified CT DEEP.  This rusty brown influent was interfering with the plant’s ability to treat the sewage.  The superintendent took samples and determined that the lead concentration of the rusty brown influent was approximately 127 times greater than the plant’s normal lead measurement, and that its zinc concentration was over 10 times the typical zinc concentration.  During the next several days, the superintendent had to order several truckloads of biologic microorganisms to break down the unprocessed sewage.  It took two weeks for the treatment plant to return to usual operational capacity. 

On September 27 and 29, 2016, CT DEEP and the plant superintendent inspected Marmon Utility’s Kerite facility and concluded that it had discharged the rusty brown influent with the high lead and zinc concentrations on September 7, 8, and 9, 2016.  CT DEEP issued a Notice of Violation to Marmon Utility based on, among other evidence:

  • The Marmon Utility facility manager’s statements (1) that the wastewater treatment operator had not been at the facility since the end of March 2016 due to medical reasons; (2) that no sludge had been processed in the filter press since this employee’s departure; and (3) no other Marmon Utility employee had been trained to process sludge as required under the CT DEEP permit.
  • The Kerite factory had discharged 5,725 gallons of industrial wastewater on September 7, 2016, and 5,225 gallons on September 8, 2016, which exceeded the daily discharge limit in Marmon Utility’s CT DEEP permit.
  • The lead concentration in water samples taken from Marmon Utility’s final discharge tank, which flows to the Seymour sewage treatment plant, was 69 times greater than the permissible limit in Marmon Utility’s CT DEEP permit.  The zinc concentration was 8.5 times greater than the prescribed limit.

The EPA’s investigation further disclosed that from at least April 24 to September 29, 2016, the Marmon Utility maintenance employees operating the wastewater treatment system did not know how to check and maintain the pH probe, operate the sludge filter press, check or change certain filters. These were all key components of the treatment system used to remove heavy metals from the factory’s industrial wastewater.  These employees did not even have access to the system’s operational manuals. 

In fact, these Marmon Utility employees informed investigators that, during this time period, when certain tanks became full and the system was imbalanced, they would empty the tank by opening certain valves to discharge the industrial wastewater without treating it.  As of mid-October 2016, the 3,000-gallon holding tank in Marmon Utility’s wastewater treatment system held 1,000 gallons of sludge.

In addition to improperly operating and maintaining the wastewater treatment system and sludge-processing equipment at the Seymour factory, Marmon Utility has also admitted to knowingly exceeding its maximum daily discharge limit in its CT DEEP permit on September 7 and 8, 2016, knowingly failing to notify CT DEEP promptly of the improper bypass, and that it had stopped processing the sludge using a sludge filter press as required under the CT DEEP permit.

This matter was investigated by the U.S. Environmental Protection Agency and the Connecticut Department of Energy and Environmental Protection.  The case was prosecuted by Assistant U.S. Attorney Hal Chen, with assistance from the Connecticut Office of the Attorney General. 

Security News: Harrisburg Man Sentenced To 15 Years’ Imprisonment For Firearms Offense

Source: United States Department of Justice News

HARRISBURG – The United States Attorney’s Office for the Middle District of Pennsylvania announced that Alfred Stewart, age 38, of Harrisburg, Pennsylvania, was sentenced on April 6, 2022, to 15 years’ imprisonment by United States District Court Judge Jennifer P. Wilson for possession of a firearm as an Armed Career Criminal.

According to United States Attorney John C. Gurganus, Stewart was previously convicted by a jury in October 2021, of being a felon in possession of a firearm. The United States Marshal Service arrested Stewart on March 27, 2019, for violating his federal supervised release.  When they tried to arrest Stewart, he climbed out onto the roof of the Harrisburg home with a gun in his hand. Stewart tried to hide the gun from police by putting it down the chimney of the home. Police arrested Stewart and searched the chimney flue in the basement and found the gun. 

Stewart had previously served approximately 8 years in federal prison for drug trafficking. He had two prior convictions for drug trafficking in 2002 in state court.  Judge Wilson also sentenced Stewart to two years in prison for violating the conditions of his supervised release. Stewart must serve the two year sentence consecutively to his 15-year sentence.

The case was investigated by the U.S. Bureau of Alcohol Tobacco Firearms and Explosives (ATF), the U.S. Marshal Service, and the Harrisburg City Police Department. Assistant U.S. Attorney Michael A. Consiglio prosecuted the case.

This case is being prosecuted as part of the joint federal, state, and local Project Safe Neighborhoods (PSN) Program, the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime.  Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them.  As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

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