Month: November 2017

Who’s the boss? That’s the awkward question after the departing head of a government agency charged with looking after consumer rights appointed a deputy to temporarily fill his spot. The White House then named its own interim leader.

One job, two people — and two very different views on how to do it.

The first pick is expected to continue the aggressive policing of banks and other lenders that have angered Republicans. The second, President Donald Trump’s choice, has called the agency a “joke,” an example of bureaucracy run amok, and is expected to dismantle much of what the agency has done.

So come Monday, who will be leading the Consumer Financial Protection Bureau?

​Both say law on their side

Senior Trump administration officials said Saturday that the law was on their side and they expect no trouble when Trump’s pick for temporary director of the CFPB shows up for work. Departing director Richard Cordray, an Obama appointee long criticized by Congressional Republicans as overzealous, had cited a different rule in saying the law was on his side.

In tendering his resignation Friday, Cordray elevated Leandra English, who was the agency’s chief of staff, into the deputy director position. Citing the Dodd-Frank Act that created the CFPB, he said English, an ally of his, would become acting director upon his departure.

Corday’s move was widely seen as an attempt to stop Trump from shaping the agency in the months ahead.

The White House cites the Federal Vacancies Reform Act of 1998. Administration officials on Saturday acknowledged that some other laws appear to clash with Vacancies Act, but said that in this case the president’s authority takes precedence.

Important, though temporary, job

Who prevails in the legal wrangling is seen as important even though this involves just a temporary posting. Getting a permanent replacement approved by the Senate could take months.

The president’s pick for temporary appointee, Mick Mulvaney, had been widely anticipated. Mulvaney, currently director of the Office of Management and Budget, has been an outspoken critic of the agency and is expected to pull back on many of Cordray’s actions in the six years since he was appointed.

Trump announced he was picking Mulvaney within a few hours of Cordray’s announcement Friday.

“The Consumer Financial Protection Bureau, or CFPB, has been a total disaster as run by the previous Administrations pick,” Trump tweeted Saturday from his private Mar-a-Lago club in Palm Beach, Florida, where he is spending a long Thanksgiving weekend. “Financial Institutions have been devastated and unable to properly serve the public. We will bring it back to life!”

The administration officials, speaking on condition of anonymity to discuss the White House’s thinking, called Trump’s appointment of an acting director a “routine move.” They said the Justice Department’s Office of Legal Counsel has already approved Trump’s appointment of Mulvaney and will issue a written legal opinion soon.

The clashing appointments raise the question: What happens when the two new heads show up and try to sit at the same desk and give orders?

One of the administration officials said Mulvaney was expected to start working Monday and that English was expected to also show up — but as deputy director.

Leandra English

English is a trusted lieutenant of Cordray’s who has helped investigate and punish financial companies in ways that many Republicans, Mulvaney in particular, think go too far. In his announcement Friday, Cordray highlighted English’s “in-depth” knowledge of the agency’s operations and its staff. Before joining the CFPB, English served at the Office of Management and Budget and Office of Personnel Management.

“Leandra is a seasoned professional who has spent her career of public service focused on promoting smooth and efficient operations,” Cordray said in the statement.

Mick Mulvaney

Mulvaney was a South Carolina representative to the House before becoming head of the budget office. A founder of the hard-right House Freedom Caucus, he was elected in 2010 as part of a tea party wave that brought many critics of the U.S. budget deficit to office. He has taken a hard line on federal spending matters, routinely voting against increasing the government’s borrowing cap and pressing for major cuts to benefit programs as the path to balancing the budget.

He also has been unsparing in his criticism of the CFPB. In a widely quoted comment, he once blasted the agency as “joke,” saying its lack of oversight by Congress and its far-reaching regulations had gone too far.

“The place is a wonderful example of how a bureaucracy will function if it has no accountability to anybody,” he told the Credit Union Times in 2014. “It turns up being a joke in a sick, sad kind of way.”

Congress weighs in

U.S. Rep. Jeb Hensarling, chairman of the powerful House Financial Services Committee and a longtime critic of Cordray, said Mulvaney would “fight not only to protect consumers from force, fraud, and deception but will protect them from government interference with competitive, innovative markets and help preserve their fundamental economic opportunities and liberties.”

Democrats have seized upon Mulvaney’s words in criticizing his appointment to the agency.

U.S. Rep. Maxine Waters of California, the top Democrat on the Financial Services Committee, issued a statement Saturday calling Mulvaney “unacceptable” to lead the CFPB because of his “noxious” views toward its mission to protect consumers.

“He was also the original co-sponsor of a bill to completely eliminate the Consumer Bureau,” she wrote, “and supported other legislation to harmfully roll back Wall Street reform.”
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The U.S. vice consul in Brazil was discharged Saturday from a hospital after being shot in the foot in an attempted robbery at a seaside holiday resort near Rio de Janeiro, local media reported.

Stephanie Masland Bohlen was operated on Friday at Samaritan Hospital, Agencia Brasil said.

Masland Bohlen and her husband were approached by two unidentified people late Thursday as they stopped to adjust their GPS navigation system on a highway in Angra dos Reis, in the southern part of Rio state, according to local media.

When they tried to flee, Masland Bohlen was shot in the foot. Her husband was unharmed.

Civil police are handling the investigation.

A British tourist was shot and wounded in Angra dos Reis in August when she, her husband and their three children accidentally drove into a favela controlled by criminals.

The Rio area is one of the world’s most famous tourist destinations but many favelas — largely unregulated communities of working-class Brazilians — are public safety nightmares.
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The three American sailors who missing since their plane crashed into the Philippine Sea were identified by the U.S. Navy on Saturday as Lt. Steven Combs, Aviation Boatswain’s Mate Airman Matthew Chialastri, and Aviation Ordnanceman Airman Apprentice Bryan Grosso.

The Navy said Thursday that eight U.S. Navy and Japan Maritime Self-Defense Force ships, three helicopter squadrons and maritime patrol aircraft had covered nearly 1,000 square nautical miles in the two-day search for the missing sailors.

On Thursday, search and rescue efforts were halted for the three sailors, who were lost at sea Wednesday when a U.S. Navy transport plane crashed into the western Pacific Ocean.

“Our thoughts and prayers are with our lost shipmates and their families,” said Rear Admiral Marc Dalton, commander, Task Force 70.

“As difficult as this is, we are thankful for the rapid and effective response that led to the rescue of eight of our shipmates, and I appreciate the professionalism and dedication shown by all who participated in the search efforts.”

​Routine mission

The Navy said the twin-propeller C2-A Greyhound aircraft plummeted into the sea about 925 kilometers southeast of Okinawa while it was on a routine mission taking passengers and cargo from a U.S. base in Japan to the USS Ronald Reagan aircraft carrier.

It said the eight people were rescued about 40 minutes later and taken to the Reagan where they are reported in good condition. There was no immediate explanation for the crash, and the Navy said the incident is being investigated.

U.S. President Donald Trump, at his oceanfront Mar-a-Lago resort in Florida for the Thanksgiving holiday weekend, said via Twitter that he is monitoring the situation.

“Prayers for all involved,” he said.

Joint exercises with Japan

The Reagan was operating in the Philippine Sea as part of joint exercises with Japan’s Maritime Self-Defense Force, part of 10 days of training designed to increase defensive readiness and interoperability in air and sea maneuvers between the two countries.

More than 14,000 U.S. personnel are participating in the drills, which also include the guided-missile destroyers USS Stethem, USS Chafee and USS Mustin, and a maritime patrol and reconnaissance squadron.

Fifth accident this year

Wednesday’s crash was the fifth major Navy incident in Asian waters this year. Two fatal accidents left 17 sailors dead and prompted the Defense Department to remove of eight top Navy officers from their posts, including the 7th Fleet commander.

The destroyer USS John S. McCain collided with an oil tanker in August off Singapore, leaving 10 U.S. sailors dead and five injured. The USS Fitzgerald, another destroyer, collided with a container ship in waters off Japan in June, killing seven sailors.

After investigations, the Navy concluded the collisions were avoidable, resulting from widespread failures by commanders and crewmembers, who did not recognize and respond quickly to the emergencies as they unfolded. The Navy has called for improved training, and increasing sleep and stress management for sailors.

Separately, in January, the USS Antietam ran aground near Yosuka, Japan, and the USS Lake Champlain collided with a South Korean fishing vessel in May.

 

 
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The U.S. has reversed its decision that would have closed the Palestine Liberation Organization (PLO) office in Washington.

The U.S. said last week the PLO had to close its office because the organization had violated a little-known provision in U.S. law prohibiting a PLO  Washington office if the organization asked the International Criminal Court to investigate Israelis or prosecute Israelis for crimes against Palestinians.

Palestinian President Mahmoud Abbas asked the international court earlier this year to “open an investigation and to prosecute Israeli officials for their involvement in settlement activities and aggressions against our people.”

Mustafa Barghouti, a Palestinian legislator, told the Associated Press that the U.S. made a “correct” decision in reversing its original choice.  He said the first decision should not have been made because “the United States cannot play the role of a mediator and at the same time take the side of the Israelis against the Palestinians  …We cannot have peace in this region if the United States government continues to be biased to the Israeli positions.”

A State Department spokesman says the U.S. has “advised the PLO Office to limit its activities to those related to achieving a lasting, comprehensive peace between the Israelis and Palestinians.”

 
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When people come to the U.S. seeking protection because they have suffered persecution or are afraid they will suffer persecution, they are permitted to file for asylum regardless of their immigration status.

U.S. law offers asylum to those people facing persecution in their home countries on the basis of race, religion, nationality, political opinion or membership in a particular group.

WATCH: What is Asylum and How Does it Work in the US?

There are two kinds of asylum: affirmative and defensive. An immigrant may claim affirmative asylum within one year of their last arrival in the United States. An immigrant may request defensive asylum while fighting an order of deportation.

During the years 2013-2015, an average of about 25,000 people received asylum each year. Almost twice as many affirmative applicants were approved as defensive applicants.

Detention

Applicants must be physically present in the U.S. to apply for asylum.

Current policy is to detain asylum-seekers, often when they arrive at a port of entry. Waiting while their cases go through the courts can mean spending months in a detention center.

“We are closing the doors on so many people, and the first thing that they get when they come here to the U.S. is like ‘OK, we’re going to lock you up,’” said Rosa Santana, a detainee visitation coordinator at First Friends immigrant advocacy group. “We don’t know what these people have been through, their traumas. Putting them in detention is another trauma for them.”

First Friends is a local nonprofit in Jersey City, New Jersey, and its visitation groups visit immigrant detainees at the Elizabeth Detention Center, Hudson County Correctional Center, Bergen County Jail and Essex County Correctional Center-Delaney Hall.

Credible fear

Asylum-seekers must apply within one year from the date of last arrival or show proof of an “exceptional” change based on extraordinary circumstances. Above all, they must prove to the asylum officer or to an immigration court judge that they have a “credible fear” of returning to their home country.

To Judy Pepenella, community organizer at the Conservative Society for Action in New York, asylum is a “touchy” subject.

“I have a problem, personally, and it has to be honesty. You know, just because you have to get out and you don’t have the ability to become a citizen and you don’t want go back, it has to truly be an issue,” Pepenella told VOA.

Pepenella, a Republican and conservative, said though she doesn’t believe in jailing asylum-seekers, each case must be looked at on its merit.

“When they come here, are they gonna become citizens, or are they going to stay on an immigrant or not American basis? If you come, become a citizen, become part of the process, become part of what makes America great,” Pepenella added.

WATCH: Asylum in the US: The Pros and Cons

Future of asylum

The White House wants to tighten standards in the U.S. asylum system.

U.S. Attorney General Jeff Sessions has claimed the current asylum system is “subject to rampant abuse and fraud” and he called for tighter rules for people seeking asylum in the United States.

Sessions said current policies allow applicants to take advantage of a “broken” court system that is backlogged by about 600,000 cases nationwide, although not all are asylum cases.

Figures from the months of July, August and September of 2016 and 2017, while hardly conclusive, indicate that asylum cases were being adjudicated at a faster rate since Trump took office in 2017 than the previous year — and that the percentages of approval, at least for affirmative cases, have fallen off slightly.

July 2016: 1,957 cases adjudicated; 996 affirmative approvals

August 2016: 2,262 cases adjudicated; 884 affirmative approvals

September 2016: 2,232 cases adjudicated, 967 affirmative approvals

 

July 2017: 3,934 cases adjudicated; 1,252 affirmative approvals

August 2017: 5,336 cases adjudicated; 1,543 affirmative approvals

September 2017: 4,255 cases adjudicated; 1,513 affirmative approvals

Pepenella struggles with asylum. 

“I’m not saying everyone is lying, please make sure you understand that, there are nations that people need help to get out of,” she said.

But Santana sees it in stark, human terms. 

“We know that they are not lying. We can hear the desperation, you know, when we talk to them,” she said. “Every day we have tears in our eyes from the stories that we hear. Because we know that people are really risking their lives to come here.”
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The politically fraught trial of a Turkish-Iranian businessman accused of running a multibillion-dollar scheme to evade U.S. sanctions on Iran gets underway next week but is widely expected to start without the main suspect: Reza Zarrab.

Zarrab is a 33-year-old multimillionaire of dual Iranian-Turkish citizenship with business interests in Turkey and the United Arab Emirates, and ties to the governments of Turkey and Iran.

He was arrested in Florida in March 2016 while on a family trip to Disney World and later moved to New York to face criminal charges of helping Iran evade U.S. sanctions between 2010 and 2015 by laundering money through the U.S. financial system and bribing Turkish officials.

​US-Turkey relations

The impending trial has become a flashpoint in deteriorating U.S.-Turkish relations.

Turkish President Recept Tayyip Erdogan has personally lobbied the U.S. to release Zarrab, raising questions that Erdogan and other Turkish official are worried Zarrab could implicate them with bribery and corruption.

Meanwhile, the recent transfer of Zarrab from a federal detention center in New York to an undisclosed location has prompted speculation that he is cooperating with U.S. prosecutors, possibly on unrelated matters of interest to Turkey.

Zarrab is accused of using a network of front companies in Turkey and the UAE to disguise hundreds of millions of dollars of business transactions on behalf of the Iranian government and other Iranian entities.

One entity, Mahan Air, is charged with ferrying fighters to Syria. Among other things, Zarrab is accused of shipping gold to Iran in exchange for Iranian oil and natural gas in a scheme known as “gold for gas.”

To facilitate his scheme, Zarrab allegedly paid tens of millions of dollars to Turkish government officials and bank executives.

The sanctions, aimed at Iran’s access to U.S. financial institutions, were lifted after Iran struck a deal with the U.S. and other major world powers in 2015 to keep a peaceful nuclear program.

Eight other people, including Zarrab’s 39-year-old brother, Mohammad Zarrab, and a former minister of economy, Mehmet Zafer Caglayan, have been indicted on charges related to the scheme.

But only one other, Mehmet Atilla, a former deputy general manager of Halkbank, one of Turkey’s largest banks, has been arrested.

Their trial has been repeatedly postponed and is now scheduled to start Monday in New York with jury selection.

Allegations

In court filings, prosecutors have alleged that Zarrab has had a personal relationship with Erdogan and that Erdogan may have known of of Zarrab’s sanctions-busting scheme.

Erdogan is not accused of any wrongdoing, but he and other Turkish officials have slammed the case as a conspiracy against Turkey.

Erdogan has repeatedly pressed President Donald Trump and former President Barack Obama to drop the case. In September, he said Trump told him that the “prosecution is out of his jurisdiction.”

Yet as Zarrab’s trial draws near, there are indications that Zarrab may be negotiating a deal with U.S. prosecutors.

For starters, his whereabouts remains a mystery.

According to the U.S. Bureau of Prisons website, Zarrab was “released” from the Metropolitan Correction Center, a federal detention center in New York, Nov. 8.

But the U.S. Attorney’s Office for the Southern District of New York in Manhattan, where Zarrab will be tried, says he remains in “federal custody.”

Nick Biase, a spokesman for the U.S. attorney for the Southern District of New York, confirmed Zarrab’s detention to VOA but declined to elaborate.

Indication he’s talking

Legal experts say Zarrab’s release from federal detention is an indication that he’s talking to prosecutors as part of a guilty plea deal.

“One cannot be sure, but the most likely explanation for the release of a detained defendant, in the absence of any formal release from detention, is that he is in the custody of the FBI,” said Daniel Richman, a former federal prosecutor now a professor at Columbia University in New York. “This move rarely happens, but has occurred in extraordinary circumstances.”

Benjamin Brafman, Zarrab’s lead attorney, did not respond to a request for comment.

In recent weeks, Brafman and Zarrab’s other lawyers have not participated in key pretrial proceedings, such as providing questions for prospective jurors. That has fueled speculation that Zarrab may skip his own trial.

In an Oct. 30 court filing, Victor Rocco, an attorney for Atilla, Zarrab’s co-defendant, wrote that it appeared “likely that Mr. Atilla will be the only defendant appearing at trial.”

Eric Jaso, a former federal prosecutor now a partner at the Spiro Harrison law firm in Short Hills, New Jersey, said the absence of Zarrab’s lawyers from court proceedings could mean Zarrab is cooperating with the government.

Adding to the mystery, the federal judge overseeing the case dropped Zarrab’s name from the title of the case in an order issued Monday and replaced it with Atilla’s name.

The title change suggests Atilla will be the only defendant on trial Monday, Richman said.

“It is also consistent with Zarrab’s having already entered a guilty plea, although that is not necessarily the case,” Richman said.

Acting U.S. Attorney Joon Kim, whose office is prosecuting the case, gave no indication last week that his office has dropped the case against Zarrab.

“This case, our case, the prosecution that’s going on and we’ll start next week in the courthouse, was brought and will continue to be brought by career prosecutors, by career FBI agents and investigators,” Kim said at a press conference.
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The director of the Consumer Financial Protection Bureau resigned Friday and named his own successor, leading to an open conflict with President Donald Trump, who announced a different person as acting head of the agency later in the day.

That means there are now effectively two acting directors of the CFPB, when there should only be one.

Typically an acting director position would be filled according to the Federal Vacancies Reform Act of 1998. But Richard Cordray, along with his resignation, elevated Leandra English, who was the agency’s chief of staff, into the deputy director position.

Under the Dodd-Frank Act that created the CFPB, English would become acting director. Cordray, an Obama appointee, specifically cited the law when he moved English, a longtime CFPB employee and ally of his, into that position.

​Trump appoints CFPB critic

Within a few hours, President Donald Trump announced his own acting director of the agency, Mick Mulvaney, who is currently director of the Office of Management and Budget. Mulvaney had widely been expected to be Trump’s temporary pick for the bureau until a permanent one could be found.

Mulvaney is a long-time critic of the CFPB, and has wanted the agency’s authority significantly curtailed. So the difference between English and Mulvaney running the agency would be significant.

Senate confirmation needed

The person nominated to be director of the CFPB requires confirmation by the Senate, and it could be many weeks or months before the person would be able to step into the role permanently. Cordray’s move was aimed at allowing his favored successor to keep running the agency for as long as possible before a Trump appointee is confirmed by the Senate.

Cordray had announced earlier this month that he would resign by the end of this month. There is wide speculation that Cordray, a Democrat, is resigning in order to run for governor in his home state of Ohio.

What CFPB does

The CFPB was created as part of the laws passed following the 2008 financial crisis and subsequent recession. The agency was given a broad mandate to be a watchdog for consumers when they deal with banks and credit card, student loan and mortgage companies, as well as debt collectors and payday lenders. Nearly every American who deals with banks or a credit card company or has a mortgage has been affected by new rules the agency put in place.

Cordray used that mandate aggressively as its first director, which often made him a target for the banking industry’s Washington lobbyists and congressional Republicans who believed Cordray was overreaching in his role, calling the CFPB a “rogue agency.”

As director, he also was able to extract billions of dollars in settlements from banks, debt collectors and other financial services companies for wrongdoing. When Wells Fargo was found to have opened millions of phony accounts for its customers, the CFPB fined the bank $100 million, the agency’s largest penalty to date.
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