Whistleblower Stories | 60 Minutes Marathon
In a Nutshell
This 60 Minutes marathon profiles whistleblowers exposing corporate and institutional corruption: Dr. Jeffrey Wigand on Brown & Williamson's nicotine addiction cover-up and additives; Boeing workers on safety lapses like missing parts and defective manufacturing; Frances Haugen on Facebook's prioritization of engagement over safety, fueling hate and teen mental health crises; Bradley Birkenfeld on UBS aiding U.S. tax evasion; Cheryl Eckert on GlaxoSmithKline's adulterated drugs; Thomas Drake on NSA's pre-9/11 tech failures; Joe Ranasisi on DEA's crippled opioid crackdown due to industry lobbying; Siobhan O'Connor on Catholic Church abuse cover-ups; Howard Wilkinson on Danske Bank's $230B money laundering; David Nielsen on Mormon Church's $100B+ hidden investments; Dr. Rick Bright on politicized COVID-19 response; and insurance adjusters on post-hurricane claim fraud. Whistleblowers faced retaliation—smear campaigns, firings, threats, Espionage Act charges, and family ruin—but their revelations triggered investigations, fines (e.g., Glaxo $750M, Danske probes, SEC $5M to Mormon Church), lawsuits, and policy shifts, saving lives and recovering billions while highlighting systemic failures in tobacco, aviation, tech, finance, pharma, government, religion, and insurance. Core message: Courageous insiders risk everything to reveal profit-driven fraud killing millions, yet powerful entities prioritize cover-ups over accountability, underscoring the vital need for whistleblower protections.
These notes were generated by AI and may contain inaccuracies.
A story reported six months ago has turned into two: how cigarettes destroy lives and how Brown and Williamson (B&W), America's third largest tobacco company, is trying to destroy the reputation of Dr. Jeffrey Weigand, their former $300,000-a-year director of research. B&W employed prestigious law firms to sue him, a high-powered investigation firm to probe his life, and a public relations consultant to plant damaging stories in the Washington Post, Wall Street Journal, and others. The Journal reported scant evidence.
CBS management initially wouldn't broadcast the story and interview with Weigand due to fears of a multi-billion-dollar lawsuit for tortious interference with his confidentiality agreement. Last week, the Wall Street Journal published a confidential November deposition Weigand gave in a Mississippi case, repeating charges he made to CBS in August. Now, broadcasting is proceeding.
Dr. Weigand claims B&W executives knew their cigarettes and pipe tobacco contained additives increasing disease danger and that nicotine is an addictive drug, despite public denials like Thomas Sandifer's (B&W CEO) congressional testimony: > "I believe nicotine is not addictive."
Weigand says Sandifer perjured himself, as B&W internally knew: > "We're a nicotine delivery business. ... Cigarettes are a delivery device for nicotine. Put it in your mouth, light it up, and you're going to get your fix."
B&W manipulates nicotine via chemical additives like ammonia (impact boosting), enhancing absorption into lungs and brain, described in B&W's leaf blenders manual and documents using ammonia chemistry.
Thousands of pages of confidential B&W scientific reports and legal memoranda support claims that executives knew nicotine is addictive and products cause cancer and other diseases. Documents were locked in lawyers' files in Louisville, Kentucky, until paralegal Merrill Williams took them to Dr. Stanton Glantz, University of California Medical Center, San Francisco. Glantz's team published in Journal of the American Medical Association:
Documents show 30 years ago B&W and parent British American Tobacco knew nicotine was addictive and smoking caused cancer and diseases. They hid knowledge from public and health authorities with sophisticated legal strategies.
Documents repeatedly call cigarette a nicotine delivery instrument.
Weigand hired January 1, 1989, to reduce hazards, carcinogenic components in products. Company discussed carcinogens, cancer, heart disease, emphysema for safer cigarette. Weigand, with PhD in biochemistry and 20 years in healthcare/biotech, was enthusiastic.
Made vice president for R&D, paid over $300,000/year. Asked about nicotine, pharmacology, biological studies on central nervous system: always told no. But confidential files showed they had done such studies.
At global British American Tobacco scientists' meeting, discussed safer cigarette, but lawyers rewrote minutes. Kendrick Wells (B&W staff attorney, now assistant general counsel) edited 18-page minutes to sanitize, remove safer cigarette discussions to reduce product liability exposure.
Lawyers purged documents referencing less hazardous or safer. Weigand dug deeper, accompanied by lawyer (Kendrick Wells) as "bodyguard" at meetings.
Complained to Thomas Sandifer (then president): Sandifer said, > "I don't want to hear any more discussion about a safer cigarette. If we pursue a safer cigarette, it would put us at extreme exposure with every other product." Acknowledged people dying from cancer, heart disease, emphysema. B&W lawyers deny this.
Weigand angry but stayed for family, salary.
Shifted to additives like glycerol (keeps tobacco moist; burns to acrolein, lung irritant, acts like carcinogen). B&W adds glycerol.
Coumarin (sweet flavoring, causes liver tumors in mice, lung-specific carcinogen per national toxic safety program) in Sir Walter Raleigh aromatic pipe tobacco until at least 1992. Transition to substitute failed. Weigand memo to Sandifer: couldn't continue in conscience. Told it would affect sales, mind own business, continue working on substitute.
Charges B&W ignored health considerations consciously. Fired March 24, 1993, by new CEO Sandifer for "poor communication skills, poor performance."
Contract provided severance and health benefits (critical: one child needs expensive daily care). Months later, B&W sued, cut benefits claiming confidentiality violation on severance discussions. Wife Lucretia Weigand: devastating, nearly separated, went to counseling.
Settled: reinstated benefits after stricter lifelong confidentiality agreement.
Spring 1994, contacted by Democratic Congress and FDA investigators on tobacco; notified B&W, talked. Then anonymous calls: April 1994, two life threats on kids.
Male voice: "Don't mess with tobacco anymore. How are your kids?" April 28, 3pm: "Leave tobacco alone or else you'll find your kids hurt. They're pretty girls now."
Started carrying handgun.
February (year unspecified, context ~1996-97): star witness in U.S. Justice Department criminal investigation into tobacco, including if Sandifer lied to Congress on nicotine.
Lucretia Weigand filed for divorce citing spousal abuse (B&W accusation).
B&W campaign to discredit: calls him "master of deceit." Weigand: > "There are times I wish I hadn't done it, but ... I think it's worth it. In the end people will see the truth."
State attorneys general (Florida, Minnesota, Mississippi) testify: Mike Moore (Mississippi AG): > "Jeffrey's testimony is going to be devastating ... I fear for his life. ... Most important information ever against tobacco. Biggest fraud on American public ... lied ... killed millions and made a profit."
Campaign began two months ago amid media frenzy over CBS not broadcasting. B&W sued for talking despite agreement, got Kentucky court order to silence. Investigators dug into family/friends.
Half-dozen law firms compiled 500-page dossier alleging guilty pleas to wife beating, shoplifting, fudging resume, false $95.20 dry cleaning claim.
Hired John Scanlon (NY media relations) to circulate to media; declined interview but stated: > "He's running from cross-examination. His victims have decided to respond and present evidence that he is in fact a habitual liar."
Wall Street Journal front-page: many serious allegations backed by scanty or contradictory evidence; some demonstrably untrue (e.g., shoplifting guilty plea).
B&W attorney Gordon Smith: denies scant evidence, claims scores of untruths; Weigand's life "pattern of lies."
B&W personnel records: good appraisals first three years, soured fourth. Post-firing negotiated letter from personnel director: > "Dr. Jeffrey Weigand was instrumental in ... new products ... major impetus behind ... upgrade in R&D ... high level of technical knowledge."
B&W refused to be reference; this was only statement.
Smith: CBS paid Weigand $12,000 for consulting (analyzing ~1,000 pages leaked from Philip Morris, not B&W; he didn't discuss B&W then).
Weigand now $30,000/year science teacher at Louisville public high school.
Hubert Humphrey III (Minnesota AG): want full truth, stop deception/fraud, companies bear health care costs.
Bob Butterworth (Florida AG): deceit, withheld info consumers needed.
Mike Moore: worse damage than cocaine dealers; cocaine kills 10,000-15,000/year, tobacco 425,000/year.
425,000 people die every year from smoking cigarettes according to medical and scientific evaluations. 50 million people choose to use tobacco and smoke. On a cost-benefit ratio, 425,000 deaths out of 50 million users is a small fraction. People choose to smoke and choose to stop smoking.
Tobacco is a lawful product, marketed and manufactured lawfully. B&W questioned Dr. Jeffrey Weigand's character, but he calls it a smoke screen. He questions why B&W does not address developing a safer cigarette or using additives known to be carcinogenic to avoid influencing sales.
B&W removed coumarin, a carcinogenic flavoring, from their Sir Walter Raleigh aromatic pipe tobacco, but insisted it never posed a health risk. B&W lawyer Kendrick Wells denied altering minutes of a scientific meeting. B&W says the truth will come out when they cross-examine Dr. Weigand under oath. B&W claims CBS cannot report objectively since CBS is indemnifying Dr. Weigand in B&W's lawsuit against him.
Two months ago, CBS agreed to indemnify Dr. Weigand after a leak revealed his identity before he was prepared to go public, exposing him to the lawsuit. Louisville Courier-Journal headline: charges that B&W employers engaged in smuggling and bribes against the president of Indiana. U.S. Attorney in New Orleans says indictments coming soon.
Panel blew off side of Boeing airplane in January, leaving gaping hole. Four federal investigations launched. Boeing hired new CEO to restore trust. FAA received over 200 whistleblower reports in the last year on mismanagement of parts, poor manufacturing, sloppy inspections.
Alaska Airlines flight 177 passengers, door plug blew off 3 miles above ground after takeoff from Portland. Plane was Boeing 737-9 MAX, a few months old, landed safely, no serious injuries. NTSB: four bolts required to secure door plug removed during production at Boeing's Renton, Washington factory and never reinstalled. No paperwork explaining how plane left factory broken.
Sam Mohawk, 13 years at Boeing Renton factory (makes 30% of world's commercial jet fleet), not surprised by door plug incident, almost expecting something, happy it wasn't catastrophic as it brought visibility. Warned Boeing and regulators about safety lapses before incident.
Keep airplanes moving at all costs, even safety. Problems started during COVID with ramp-up and supply chain issues. Mohawk tracks defective parts in parts jail (locked with chain of evidence). Employees sidestepped protocol, took bad parts out when team not looking due to desperation for parts.
Faulty parts recycled back onto airplanes repeatedly to avoid stopping production. Thousands of missing parts, including 42 flawed rudders (primary steering tools) that wouldn't last 30-year jet lifespan. Huge parts went missing, moved without authorization. Could lead to catastrophic event like Russian roulette.
John Barnett, 30 years at Boeing, quality manager on 787 Dreamliner at South Carolina factory from 2010. Managers pressured to ignore FAA regulations like not tracking defective parts, retaliated against him (Boeing denies). Retired 2017, had 3,000+ internal documents, emails, photos.
Attorney Rob Turkowitz: Barnett best witness, knew facts without documents. Scheduled for final depositions March 9, 2024; found dead in truck at hotel with self-inflicted gunshot wound (age 62). Family (brothers Rodney, Robbie, Michael, mom Vicki) continuing legal fight.
Barnett felt under siege, embarrassed at meetings, wore on him, but pursued because right thing to do.
Merle Myers, 30 years at Boeing, quality manager at Everett, Washington plant until last year. In 2015, discovered scrapped defective 787 landing gear axles (corroded beyond repair, spray-painted red) taken back to factory for over a decade. Schedule-driven, didn't want to wait.
Scrap parts cleaned with chemicals before installation. Managers competed openly for parts (faulty or good) at stand-up meetings attended by VPs who did nothing. Boeing says investigated, axles didn't make it onto planes.
Sam Salipour, 40 years in aerospace, 777 line in Everett, space shuttle background (Challenger explosion). Observed workers forcing pre-drilled holes to align: force, cranes, jumping up and down. Like over-stressing paperclip, may fail after 30-40 times. Still happening.
Boeing: investigates all concerns, some feedback led to improvements, others inaccurate; no claims affected safety. NTSB: Boeing accidents declined over 20 years, safer than ever. Whistleblowers note MAX is new, future unknown.
Renton workers returned after 7-week strike; FAA not resuming production, focusing on training and supply chain. Mohawk filed federal whistleblower claim in June for protection. Concerned for safety as friends/family fly Boeing.
FAA investigating Mohawk's and hundreds of other Boeing claims.
Frances Haugen, former Facebook employee, filed complaints with federal law enforcement. Facebook's research shows it amplifies hate, misinformation, political unrest, but hides it. Instagram harms teenage girls. Took trove of private research when quit in May 2021.
Conflicts between public good and Facebook's interests; optimized for money. Worse than Google, Pinterest. Copied tens of thousands of pages in 2021 systematically. Evidence Facebook lying about progress on hate, violence, misinformation.
Estimate action on 3-5% of hate, 0.6% of violence/incitement. Hate speech, divisive political speech, misinformation affect societies worldwide, erode civic trust. Current Facebook tears societies apart, causes ethnic violence (e.g., Myanmar 2018 genocide).
Recruited 2019 to work on misinformation after losing friend to conspiracies. Assigned to Civic Integrity (election risks). Post-2020 election, dissolved team despite later insurrection. No trust in investment for safety.
2018 algorithm change optimizes for engagement/reaction. Shows hateful, divisive, polarizing content (anger easiest emotion). Safer algorithm reduces time, ads, money. Turned on safety for 2020 election temporarily, then off prioritizing growth.
Used for Jan 6 insurrection organization (posts: armed partisans, "By bullet or ballot, restoration of the republic"). Internal rage: amplifies worst of human nature, misaligned incentives.
2019 internal report: European parties say algorithm forces negative skew, extreme positions to win on platform.
13.5% teen girls: Instagram worsens suicidal thoughts. 17%: worsens eating disorders. Feedback cycle: more depressed, use more. Worse than other social media. Facebook postponed kids' Instagram.
Filed 8+ SEC complaints: Facebook lies to investors about risks. Required not to lie or withhold material info. Dodd-Frank protects sharing documents with SEC.
Haugen empathizes with Zuckerberg but criticizes choices amplifying hate. Facebook statement: balances expression and safety, makes improvements, doesn't encourage bad content.
If research had exact solution, tech, governments, society would have solved long ago.
Facebook is a $1 trillion company, just 17 years old. It has 2.8 billion users, which is 60% of all Internet-connected people on Earth. Frances Haugen plans to testify before Congress. She believes the federal government should impose regulations. Facebook has demonstrated they cannot act independently. Facebook over and over again has shown it chooses profit over safety. It is subsidizing. It is paying for its profits with our safety. > "I'm hoping that this will have had a big enough impact on the world that they get the fortitude and the motivation to actually go put those regulations into place. That's my hope."
Swiss banks in Geneva and Zurich have served as sanctuaries for the wealth of dictators, despots, mobsters, arms dealers, corrupt officials, and tax cheats. U.S. law enforcement has rarely penetrated this world. UBS, one of Switzerland's largest banks, handed over information on thousands of American tax cheats. Bradley Birkenfeld, born and raised in the Boston area, spent most of the last decade living in Switzerland, helping wealthy Americans hide their money. He was based in Geneva, where there may be more money counting machines than parking meters in a country that once bragged it had more banks than dentists. It's not Swiss money in those banks. It's foreigners. Culture ingrained in society about managing people's money, protected by Swiss bank secrecy. Under Swiss law, only the banker and the bank have a right to that information.
"How unusual is it for a Swiss banker to come forward and say this is how it works? It's never happened before in history. I'm the first one."
Birkenfeld, a mid-level banker with an undistinguished employment history, knocked on the U.S. Justice Department door in spring 2007, touching off an investigation threatening UBS with extinction and shaking 300 years of Swiss banking secrecy. He provided inside information and documentation that UBS actively helped American clients defraud the U.S. Treasury out of billions in unpaid taxes.
Most valuable info: 19,000 clients and around 20 billion Swiss francs (~$19 billion) in assets managed by UBS in the U.S. out of Switzerland. Of American accounts he represented, 90% were trying to evade taxes. It was the unwritten rule; people wouldn't fly to Switzerland just to declare money.
As private banker, Birkenfeld helped clients invest, spend, move money. Example: withdrew cash, bought diamonds in Geneva, smuggled into U.S. in toothpaste tube for client. Diamonds worth less than $10,000, no customs declaration needed. > "If it was legal, why did you put them in a toothpaste tube? ... Oh, it was just a way of carrying them so I wouldn't lose them." Not trying to hide from customs.
Clients asked for purchases like cars, chalets, watches; bankers catered and delivered to hotel, another country, or Geneva. Not just banker but personal shopper at concierge level.
Birkenfeld offered to wear a wire against high-level UBS executives for full immunity. Negotiations broke down. He neglected to disclose dealings with biggest client, Igor Olenekoff (California real estate developer), hiding $200 million via shell companies and sham entities concealing UBS account ownership. > "I don't sign people's tax return, so what they do with their taxes is not my business. I'm a banker." He recommended service providers. Felt uncomfortable entering U.S.
Gave Justice Department, Senate, IRS, SEC info on UBS secret activities. Transactions held in vault, sealed until client pickup; then take or shred. No online accounts or e-banking for U.S. clients. No mailed statements. Clients had to visit Switzerland or see banker in U.S.
UBS sponsored lavish events like yacht races in Newport and Art Basel Modern Art Festival in Miami Beach to attract wealthy Americans. Flew in Swiss bankers (unlicensed in U.S.) to drum up clients and conduct business, violating U.S. banking laws. Internal documents showed avoiding detection: call it vacation, not business trip. Colleagues brought encrypted laptops with client portfolios and product offerings. Brought checks or carried money client-to-client to disguise large transfers.
Thomas Pirelli, associate attorney general, says Birkenfeld's evidence that UBS executives encouraged illegal behavior was the bank's Achilles' heel. Senior officials knew it was wrong, called it toxic waste, but it was profitable and continued. Justice Department/IRS got court order for records on 19,000 Americans. UBS paid $780 million fine, ceased offshore banking with Americans, turned over names of more than 4,000 U.S. citizens suspected of tax fraud. U.S. threatened to revoke U.S. business license.
Got core fraud accounts: largest, most clearly fraudulent. Clients withdrew $160 billion from UBS wealth management. 14,700 Americans notified IRS of offshore accounts via program to pay back taxes/penalties, escape prosecution. IRS expects billions in revenue.
Birkenfeld wore electronic ankle bracelet, restricted to Massachusetts. > "I gave them the biggest tax fraud case in the world. I exposed 19,000 international criminals. And I'm going to jail for that?"
While using his info, DOJ closed in on Olenekoff, who cooperated, paid $52 million fines/back taxes, no jail. Birkenfeld hadn't disclosed relationship, charged with conspiracy to commit tax fraud, pled guilty, sentenced to 40 months prison.
"And you think that you should not be going to jail? ... Even though you violated the law and you were an enabler. ... And I'm the only one going to prison. Out of 19,000 accounts and no Swiss bankers?"
DOJ: If he'd told everything in summer 2007, likely no prosecution. Not uncommon for informants to go to jail. > "The day he walks into prison is the day you will lose a generation of tax whistleblowers. ... Because no one will blow the whistle."
Stephen Cohn, National Whistleblower Center head, says Birkenfeld may get tens of millions under federal law rewarding whistleblowers up to 30% of recovered money, even if jailed. > "Mr. Birkenfeld has saved the taxpayers billions of dollars, brought thousands of people to justice. They should blow up his check. The Attorney General should shake his hand ... Get 20, get 30 Birkenfelds. Let's fix this problem. Let's lower everybody's taxes."
IRS decides reward; check to prison where he reports Friday. Won't return to Switzerland; regarded as criminal/traidor.
Prescription medicine should be safe/effective. GlaxoSmithKline subsidiary pleaded guilty to distributing adulterated drugs: contaminated with bacteria, mislabeled, wrong potency. Cheryl Eckert's tip triggered federal investigation.
Eckert worked in Glaxo quality control, rose to manager of global quality assurance over 10 years. Inspected plants like North Carolina facility. In 2002, led team evaluating Chedra, Puerto Rico plant: 900 employees, made 20 drugs for U.S. patients.
"All the systems were broken. The facility was broken. The equipment was broken. The processes were broken. It was the worst thing I had run across in my career."
Water for tablets tainted with bacteria. Production failures: drugs too strong/not strong enough. Employees contaminated Bactroban (antibacterial ointment, sealed tank) by opening lid, sticking body in, scraping with paddle to save money.
Worse: powerful medications mixed up, e.g., different drugs in same bottle. Chart showed 9 mix-ups, including Avandia (diabetes) with Tagamet (OTC antacid), Paxil (antidepressant) with Avandia.
Contacted North America quality VP: shut factory, call FDA, stop trucks leaving dock. Nothing happened.
Pharmacist reported mix-up: grandmother opened Paxil 10mg bottle for 8-year-old boy; pills pink not yellow. Boy sick. Paxil 10mg yellow; Paxil CR 25mg pink (2.5x dose). Both made on one line; theory: residue in hopper caused first bottles labeled 10mg to have 25mg pills.
Told same VP five months later. He reacted: > "Oh, my God, oh, my God." Glaxo filed FDA report saying mix-up not real, didn't happen at factory. All knew it was real. Report: extremely unlikely at Chedra, no adverse reactions. VP no longer with Glaxo, declined interview.
Glaxo denies allegations, denies lying to FDA. Ian McCubbin, senior VP from London HQ: Regret Chedra, spent $600 million/year on state-of-art plants/equipment. Learned, now stronger. 80 plants worldwide; none operate like Chedra. Chedra had weaker quality system implementation.
Eckert issuing warnings, no one listening. FDA inspection first revealed problems; Glaxo sent team. But Eckert found more. FDA inspections occasional; companies self-police.
Dr. Jerry Avorn, Harvard Medical School: Extraordinary look at chaotic manufacturing: sterility issues, drug mix-ups. Not isolated. Nobody minding store. Complexity no excuse; expect perfection like brain surgeons/airlines for high drug prices.
First warning August 2002. Worked 7 days/week. Factory manufacturing director: noticed her crying daily, asked her to stop; she cried nights/mornings, questioned why others weren't.
After 8 months, summary to 7 executives: 9 high-risk areas (mix-ups, water contamination, sterility). Warned FDA could seize factory. Weeks later, fired for downsizing.
Gave info to FDA. Agents seized effective drugs worth hundreds of millions. Lawyers Neil Getnik and Leslie Ann Skillen filed whistleblower suit for government. Fraud: Medicare/Medicaid paid hundreds of millions for adulterated drugs (Ceclor, Avandamet, Kytril, Bactroban).
Glaxo pleaded guilty to felony, paid $750 million to settle criminal conviction and Eckert's suit. Hopes no repeat; Chedra closed. No evidence anyone hurt by defective meds.
Under the whistleblower law, Eckert was rewarded with a percentage of the millions that the government recovered in the fraud suit. Her portion comes to $96 million. To those saying she did it for the money: > That I hope and pray that their mothers and their brothers and their children have safer medicine today than they had before I filed that lawsuit. And I believe they will.
Nearly two years before 9-11, America's largest intelligence agency was tracking three of the al-Qaeda hijackers. But the information obtained by the National Security Agency (NSA) wasn't analyzed in a way that would uncover the plot. Inside the NSA, several analysts and managers believe that the agency had a powerful tool that might have had a chance to head off 9-11. But it wasn't used. One insider was Thomas Drake, who thought taxpayer money was being wasted on useless intelligence gathering projects while promising technology was ignored. Drake tried to get the word out but was charged under the Espionage Act and could spend the rest of his life in prison. The government says he betrayed his country. Drake says the only thing he betrayed was NSA mismanagement that undermined national security.
After a long career in U.S. intelligence, Tom Drake never imagined he'd be labeled an enemy of the United States. As a young airman, he flew spy missions in the Cold War. In the Navy, he analyzed intelligence for the Joint Chiefs at the Pentagon. Later, he worked for defense contractors in electronic eavesdropping, becoming expert in top-secret contracts and computer software. He rose in 2001 to a senior executive job at the NSA. > My first day on the job was 9-11. NSA went into immediate crisis management mode. We had failed to protect the United States of America. You felt that was a failure of the National Security Agency? The entire national security establishment. It was a failure. A fundamental, systemic breakdown.
Part of the failure at the NSA was in its old technology. In the 1990s, it was becoming ineffective, overwhelmed by the explosion of digital data: vast volumes streaming across wired, wireless, phones, computers. > Choking on it. Just incredible amounts. How do you keep, even just storing it was becoming a challenge. Most of what the agency collected went unanalyzed, including clues pointing to 9-11. Kirk Wiebe and Bill Binney were career NSA intelligence analysts working on the problem. > We were greatly saddened and shocked by 9-11, but it didn't come as a total surprise. We knew there was a vulnerability, a lack of understanding of the data that put NSA in a weak position.
Recognizing that vulnerability in the late 90s, Bill Binney, a legendary NSA mathematician, led development of a revolutionary computer system to collect, isolate and connect important information like phone calls and financial transactions. Its code name was ThinThread. > ThinThread was fundamentally dedicated to collecting and processing and ultimately analyzing the vast streams of digital data. It was a breakthrough solution. Benny was pushing to use it even before the attack on America. We proposed it for January of 2001. Nine months before 9-11.
If ThinThread had been deployed worldwide at the point that it was ready, is there a chance that information could have been picked up that might have headed off 9-11? > Indeed. Absolutely, yeah. We had planned on going after all the appropriate targets at the time. Al-Qaeda, Osama bin Laden, Ayman al-Zawahiri, these were targets that you intended to focus ThinThread on. Yes. Oh, I mean the whole terrorist network, yeah. And if you had been able to do that? Well, we would have gotten the data, whatever that was there. I believe it's very likely, at least from the NSA perspective, that critical intelligence related to Al-Qaeda and associated movements would have been detected and reported. It was a chance. It's one of the great tragedies in the history of NSA, what could have been.
After 9-11, Tom Drake felt America was threatened as long as ThinThread was confined to the lab. Others at NSA doubted it was up to the job, including Lieutenant General Michael Hayden, the head of the agency. Hayden launched a massive modernization program codenamed Trailblazer. It was supposed to do what ThinThread did, and a whole lot more. Trailblazer was the NSA's biggest project. Hayden's philosophy was to let private industry do the job. Enormous deals were signed with defense contractors. Bill Binney's ThinThread program cost $3 million. Trailblazer would run more than a billion, and take years to develop. > I believe he was convinced by others that going with a large-scale industrial strength solution was the approach that NSA needed to take. You can't really understand why they would make that kind of a decision without understanding the culture of NSA. Careers are built on projects and programs. The bigger, the better the career.
Trailblazer was in trouble from the start. Contractors burned through hundreds of millions of dollars over years, and still couldn't give the NSA the capability it needed. As cost overruns soared and deadlines were broken, Tom Drake complained to his superiors and privately informed the intelligence committees on Capitol Hill. He sought out Diane Roark, the top Republican staffer on the House Intelligence Committee, responsible for overseeing the NSA. He tried internally, then went to Congress, Senate as well as House. He went by the book. But post-9/11, congressional committees were reluctant to kill any intelligence program, even one as mismanaged as Trailblazer. So Roark, Bill Binney, and Kirk Wiebe filed a confidential complaint with the Department of Defense Inspector General, calling for an investigation of Trailblazer and ThinThread. Tom Drake volunteered to be a witness. > Why did we launch the IG complaint? Out of total abject frustration, knowing that we had something so important to share, and thought we had witnessed wrongdoing that needed to be addressed.
For two years, Drake was the most important witness for the Inspector General, but the Department of Defense investigation was stamped classified, hiding the Trailblazer debacle from public view. As his frustration grew, Drake learned of a top-secret NSA program: warrantless wiretapping. > It was no longer necessary to follow the law. A huge Pandora's box had been opened up. On orders from the White House, the NSA was listening in on people in the United States without a warrant from a judge. And this is where I began to have grave concerns about the decisions that were made to bypass the Constitution willfully and deliberately as a result of 9-11. I took my grave concerns up with the general counsel at NSA. I spoke with one of their lead attorneys. He said, don't worry about it, Tom, it's all legal. It was legal because the White House said it was legal? Yes.
After four years of reporting through proper channels, Drake noticed the Baltimore Sun newspaper had begun articles about trouble at the NSA. Anonymously, Drake contacted Baltimore Sun reporter Siobhan Gorman and became an unnamed source for her articles, starting with one headlined NSA Shelved Better Program That Sifted Calls. Another article said mismanagement at NSA continued years after 9-11. > Did you ever communicate classified information to Siobhan Gorman? Did not. Not once ever? Not once ever. That was one of the fundamental rules. Whether it was oral communication, whether it was written, electronic, or later on even in hard copy, it was all unclassified, period. After those articles, the FBI raided the homes of all the people who filed the confidential complaint with the Defense Department. > They came busting in. I was in the shower at the time, and one of them came running up and pointed a gun at my eyeballs and pulled me out of the shower. He drew a gun on you? Yeah, he had it pointed at my head, yeah. But only Drake was charged. He's advised by the Government Accountability Project, a Washington legal organization that defends whistleblowers. Drake knew he'd violated a confidentiality agreement with the NSA and thought he might lose his job. But prosecutors charged him under the Espionage Act, not for divulging classified information, but for taking classified papers home without permission. He faces up to 35 years.
How does a man see 9-11 happen, know that some part of it is due to corruption and mismanagement, and sleep at night? How does a man do that? He obviously couldn't. Washington attorney Abby Lowell, experienced in the Espionage Act, explained the prosecution's view: > From the government and the prosecution's point of view, it's an important case to state that if you're a government person, and if you've signed a confidentiality agreement and you've got a security clearance based on your promise to keep our secrets secret, that you don't get the right as an individual to decide when that secret should be kept or not because you've decided that the government is right or wrong about something it wants to do. To the people who are saying this is basically clamping down on information that the public has the right to know about whistleblowing, it's important because it will see whether or not if a person has the right motives, has the right intent, whether that is a defense that will work to prevent what is a very, very harsh statute with very harsh penalties if he were to be convicted.
Some have said [he knew reaching out to a reporter was wrong under any rules, under any circumstances, and he deserves what he's getting]. On the other hand, I was an employee with the U.S. government charged with supporting and defending the Constitution, ensuring that the best of America was put in the fight, ensuring that we did so legally, responsibly, and accountably. Ultimately, the Trailblazer project chewed through more than $1.2 billion and then was canceled. The NSA and its former head, General Hayden, declined to comment. In 2006, the day the Baltimore Sun ran one of its articles, Hayden said to Congress: > A lot of the failure in the Trailblazer program was in the fact we were trying to overachieve and that a lot of the failure was we were trying to do too much all at once. After the Trailblazer fiasco, Congress revoked NSA's authority to manage large projects for five years. Thomas Drake goes on trial next month. > Why do you think you were charged under the Espionage Act? That's pretty rare. To send a chilling message. To whom? To other whistleblowers, to others in the government, not to speak out or speak out. Do not tell truth to power. We'll hammer you.
In the midst of the worst drug epidemic in American history, the U.S. Drug Enforcement Administration (DEA)'s ability to keep addictive opioids off U.S. streets was derailed, according to Joe Ranasisi, one of the most important whistleblowers interviewed by 60 Minutes. Ranasisi ran the DEA's Office of Diversion Control, the division that regulates and investigates the pharmaceutical industry. In a joint investigation by 60 Minutes and the Washington Post, Ranasisi tells the inside story of how the opioid crisis was allowed to spread, aided by Congress, lobbyists, and a drug distribution industry that shipped almost unchecked hundreds of millions of pills to rogue pharmacies and pain clinics, providing the rocket fuel for a crisis that over the last two decades has claimed 200,000 lives. > This is an industry that's out of control. What they want to do is do what they want to do and not worry about what the law is. And if they don't follow the law in drug supply, people die. That's just it. People die.
Joe Ranasisi is a tough, blunt former DEA Deputy Assistant Administrator with a law degree, a pharmacy degree, and rage at the opioid death toll. His greatest ire is for the distributors, multibillionaires and Fortune 500 companies like Cardinal Health, McKesson, and AmerisourceBergen, which control 85 or 90% of drugs going downstream. They ship pain pills from manufacturers like Purdue Pharma and Johnson & Johnson to drugstores. Ranasisi accuses them of fueling the epidemic by turning a blind eye to pain pills diverted to illicit use. > This is an industry that allowed millions and millions of drugs to go into bad pharmacies and doctors' offices that distributed them out to people who had no legitimate need for those drugs. You know the implication of what you're saying, that these big companies knew that they were pumping drugs into American communities that were killing people. That's not an implication. That's a fact. That's exactly what they did.
In the late 1990s, opioids like oxycodone and hydrocodone became routine for chronic pain. Drug companies assured doctors and congressional investigators (as in 2001 hearing) that the medications were effective and safe. > Addiction is not common. Addiction is rare in the pain patient who's properly managed. Prescriptions skyrocketed, and so did addiction. Many turned to shady pill mills, pain clinics with rogue doctors writing fraudulent prescriptions and complicit pharmacists filling them. > One stopped shopping for controlled narcotics. Pain clinics overnight popping up off an entrance ramp or an exit ramp on an interstate, and all of a sudden there's a pain clinic there. Had you ever seen anything like that before? Never. In fact, it was my opinion that this made the whole crack epidemic look like nothing. These weren't kids slinging crack on the corner. These were professionals who were doing it. They were just drug dealers in lab coats. You know what a chilling picture that paints? I do, because I watched them get arrested, and I was the one who approved the cases.
Despite arrests, opioids kept flooding the black market. Death toll rose. U.S. death rate from drug overdose in 1999 (map shown); by 2015, much higher, most opioid-related. Prosecuting crooked doctors and pharmacists wasn't stemming the epidemic, so Ranasisi moved up the food chain to the choke point: distributors. > What took you so long to go to that choke point of the distributors? This was all new to us. We weren't seeing just some security violations and a few bad orders. We were seeing hundreds of bad orders that involved millions and millions of tablets. That's when we started going after the distributors. A distributor's representative said the problem is doctors who over-prescribe, not distributors. But distributors know exactly how many pills go to every drug store and are required under the Controlled Substances Act to report and stop suspicious orders (unusually large or frequent shipments of opioids). DEA investigators say many distributors ignored that.
Jim Geldof (40-year DEA veteran, ran pharmaceutical investigations from DEA's Detroit field office) and Frank Yonker (supervised operations in Cincinnati) under Joe Ranasisi saw distributors shipping thousands of suspicious orders. Example: A pharmacy in Kermit, West Virginia (town of 392 people) ordered 9 million hydrocodone pills over two years. > All we were looking for is a good faith effort by these companies to do the right thing. And there was no good faith effort. Greed always trumped compliance. It did every time. But don't sit here and tell me, well, we're not sure what a suspicious order is. Really? I mean, this pharmacy just bought 50 times in the month that a normal pharmacy purchases, and they're in a town of 5,000 people. You don't know that that's suspicious? I mean, at some point, you're just turning a blind eye to it. These companies are a big reason for this epidemic. Yeah, absolutely they are. And I can tell you with 100% accuracy that we were in there on multiple occasions trying to get them to change their behavior, and they just flat-out ignored us.
In 2008, the DEA slapped McKesson (country's largest drug distributor) with a $13.2 million fine. That year, Cardinal Health paid a $34 million fine. Both penalized for filling hundreds of suspicious orders, millions of pills. Over the last seven years, distributors' fines totaled more than $341 million. Companies complained to Congress that DEA regulations were vague, treating them like a foreign drug cartel. The Healthcare Distribution Alliance wanted to work with DEA: > Effective enforcement must be a two-way street. > [Industry says you guys were unfair, that you were taking unfair hits at them.] It's all about the people who lost their sons and daughters. See how fair they think it is.
In 2011, more than 17,000 Americans died from opioid prescription overdoses. That year, Cardinal Health pushed back at Joe Ranasisi. Company attorneys went over his head to Justice Department, who called Ranasisi to explain tactics. > It infuriated me that I was over there trying to explain what my motives were or why I was going after these corporations. And when I went back to the office and I sat down with my staff, I basically said, you know, I just got questioned on why we're doing what we're doing. This is now. This is war. We're going after these people, and we're not going to stop. Do you really think you were getting this pushback because you were going after big companies, Fortune 500 companies? I have no doubt in my mind. So the question is, why would it be any different for these companies as compared to the small mom and pops that we had done hundreds of times before? What's the difference? The difference is they have a lot of money and a lot of influence. And that's the difference.
Ranasisi says the drug industry used money and influence to pressure top DEA lawyers to take a softer approach. Former DEA attorney Jonathan Novak said in 2013 he noticed a sea change: cases supervisors once approved easily now weren't good enough. > We had been achieving incredible success in an almost unstoppable wave, and then suddenly it stopped. Novak prosecuted cases from Ranasisi's investigators. His caseload slowed dramatically. > These were not cases where it was gray. These were cases where the evidence was crystal clear that there was wrongdoing going on. Bosses demanded ever more evidence: now, three undercovers by four officers over three months wouldn't be enough. Maybe need an expert to explain recording equipment or prescribing systems. > What's a prescription? It felt honestly confusing and almost insane.
Jim Geldof's investigations bogged down. He looked into a mid-sized distributor that shipped more than 28 million pain pills to pharmacies in West Virginia over five years. About 11 million wound up in Mingo County (population 25,000). Suddenly, roadblocks from one of Novak's bosses. > I spent a year working on this case. I sent it down there, and it's never good enough. Every time I talk to this guy, he wants something else. And I get it for him, and that's still not good enough. You know, and this goes on and on and on. And when these roadblocks keep getting thrown up in your face, at that point, you know they just don't want the case. But this is the DEA. That's what you're supposed to do. Yeah, you would think. The DEA's toughest sanction is to freeze distributors' shipments of narcotics; they haven't taken it in almost two years.
At the height of the opioid epidemic, enforcement slowed inexplicably. One big reason: D.C.'s revolving door. Novak saw DEA lawyers switch to high-paying jobs defending the drug industry, then lobby former colleagues that DEA cases were weak. > It had a chilling effect on DEA litigators. Some of the best and brightest former DEA attorneys are now on the other side and know all of the weak points. Their fingerprints are on memos and policy and emails going out where you see this concoction of what they might argue in the future. You and the other attorneys had been winning these cases? All of the time. A senior Justice Department attorney stated: Department of Justice leadership was not advised that DEA had changed enforcement strategies. Any significant policy shift should have been brought to our attention.
There was a lot of pills, a lot of people dying, and we had tools in our toolbox to try to use and stem that flow. But it seemed down in headquarters that that toolbox was shut off. You're watching an out-of-control epidemic, and yet you both feel that at the height of this epidemic your hands were being tied. Yeah. If it's a war on drugs, then treat it like a war. Addiction rate was still increasing. The amount of people seeking treatment was still increasing. It was all increasing. Still the amount of prescriptions were increasing. And we started slowing down.
In 2013, Joe Ranasisi and his DEA investigators were trying to crack down on big drug distributors that ship drugs to pharmacies across the country. He accused them of turning a blind eye as millions of prescription pain pills ended up on the black market.
New threat on Capitol Hill: with help from members of Congress, drug industry paved way for legislation stripping DEA of its most potent tool against dangerous narcotics.
If I was going to write a book about how to harm the United States with pharmaceuticals, the only thing I could think of that would immediately harm is to take the authority away from the investigative agency that is trying to enforce the Controlled Substances Act and the regulations implemented under the act.
Bill introduced in House by Pennsylvania Congressman Tom Marino, Congresswoman Nancy Pelosi, and Marsha Blackburn of Tennessee, promoted as ensuring patient access to pain medication.
Jonathan Novak from DEA's legal office: bill stripped agency ability to immediately freeze suspicious shipments of prescription narcotics (diversion).
You're not going to be able to hold anyone higher up the food chain accountable. Because of this law? Because of this law. How hard does it make your job in going after the wholesale distributors? I would say it makes it nearly impossible.
2015 Justice Department memo: bill could result in increased diversion, abuse, and public health/safety consequences.
They're toothless. I don't know how they stop this now. It's a very sad state of affairs.
Lyndon Barber, former DEA associate chief counsel, wrote the Marino bill. Now director of DEA litigation and compliance practice at Quarles & Brady's health law group.
Hi, my name's Lyndon Barber. I'm the director of the DEA litigation and compliance practice in Quarles and Brady's health law group.
Barber left DEA, joined law firm within a month, lobbied Congress for drug companies, wrote legislation. Advertised services for DEA compliance issues, government investigations, litigation involving Controlled Substances Act.
It's not surprising that this bill that has intimate knowledge of the way that DEA regulations are enforced, the way that those laws work, was written by someone who spent a lot of time there, charged a lot of cases there. Knew the workings. Very much so.
Eric Holder, attorney general, warned new law would undermine law enforcement to prevent communities/families from dangerous drugs.
Drug companies, distributors, chain drug stores, pharmaceutical manufacturers spent $106 million lobbying Congress over two years on bill and other legislation, claiming DEA out of control, harder for patients to get medication.
Joe Renasisi, DEA witness before Congress 30+ times, testified on bill.
16,651 people in 2010 died of opiate overdose. Opiate-associated overdose. This is not a game. We're not playing a game. Nobody is saying it is a game, sir. We're just trying to craft some legislation.
Renasisi lashed out at Marino's committee staffers. Marino: Renasisi accused sponsors of "supporting criminals."
I've never accused Congressman Marino of helping criminals. I said that this bill is going to protect defendants that we have under investigation. And if Congressman Marino thinks I accused him of something, I don't know what to tell you.
Week after hearing, Marino and Blackburn wrote to Justice Department inspector general demanding investigation of Renasisi for intimidating Congress.
Matt Murphy, Renasisi's lieutenant, after 30 years at DEA became drug industry consultant, now disillusioned.
There were people in industry that didn't care much for Joe Renasisi, wanted him silenced or wanted him out of the way, basically, unceremoniously kick him to the curb. My theory is that, you know, the industry, through lobbying groups, donated a certain amount of money to politicians to get a law passed that favored the industry, and also maybe using those political ties to have Joe re-elected. Congress launched an investigation of him. Right. And he was out. Yeah, pressure was put on for him to be moved out. I'm pretty confident of that. There was no reason to take the guy who was the most qualified person in DEA to run the Office of Diversion Control out of the Office of Diversion Control.
Investigation went nowhere, but Renasisi stripped of responsibilities (from supervising 600 people to none), resigned.
We were totally focused on all these people dying and all these drugs being diverted. And we were not really looking at our flanks waiting for somebody to come after us. So maybe that was my fault, and I just never realized that that was something that would have occurred.
DEA signed off on final version after fighting it, forced by Congress/industry pressure. Presented to Senate March 2016 by Mitch McConnell, passed by unanimous consent, no objections/recorded votes. Passed House same way. President Barack Obama signed week later, no ceremony/photo op.
Marino press release claimed credit. Distributors: law wouldn't limit DEA enforcement.
John J. Mulroney, DEA chief administrative law judge: legislation would make it all but impossible to prosecute unscrupulous distributors.
I just don't understand why Congress would pass a bill that strips us of our authority in the height of an opioid epidemic in places like Congressman Marino's district and Congressman Blackburn's district. Why are these people sponsoring bills when people in their backyards are dying from drugs that are coming from the same people that these bills are protecting? Why do you think that is? Because I think that the drug industry and the manufacturers, wholesalers, distributors, and chain drug stores have an influence over Congress that has never been seen before. And these people came in with their influence and their money and got a whole statute changed because they didn't like it.
Marino's chief of staff Bill Tai became lobbyist for National Association of Chain Drug Stores.
Since crackdown, pharmaceutical industry/law firms hired 46 DEA investigators/attorneys/supervisors, including 32 from division regulating drug industry. Mike Gill (DEA administrator chief of staff) to HDJN. Jason Hedges (senior DEA attorney) to Hogan Lovells.
AmerisourceBergen, McKesson, Cardinal Health declined interviews. Cardinal hired Lyndon Barber as senior VP 3 months ago.
Bill Whitaker called Cardinal PR for Barber, denied. Tried Marino's office, referred to chief of staff, called Capitol police.
Renasisi regret:
You know, all these people that died happened under my watch. The one thing I wanted to do, the one thing I just thought would have the most impact, is to lock up, arrest one of these corporate officers. You arrest a corporate officer, you arrest somebody that's involved in the decision process, knowing what the law is. If you make that arrest, then everybody sits up and takes notice, because three-piece suit guys just don't do well in prison. They don't.
Renasisi now consults state attorneys general suing distributors. Marsha Blackburn running for Senate. Tom Marino nominated as President Donald Trump's drug czar.
Roman Catholic Church facing biggest U.S. crisis since Boston sex abuse scandal 16 years ago. 13 states investigating concealment by church leaders, including bishops. Federal investigators scrutinizing Buffalo, New York diocese.
August: dozens of accused priests' info leaked from diocese secret archive, infuriating Buffalo's 600,000 Catholics.
Siobhan O'Connor, anonymous whistleblower, leaked records from Diocese of Buffalo secret archive. Worked as Bishop Richard Malone's executive assistant 3 years, spoke with FBI last week.
I've had to rely on God even more than I ever have before. Some people would say that you betrayed Bishop Malone. I did betray him, and yet I can't apologize for that because there was a greater good to consider.
Hundreds of pages: personnel files/memos revealed Bishop Malone allowed priests accused of sexual assault (statutory rape, groping) to stay on job for years.
I love my church. I love our diocese. And I loved him. I genuinely did, as my bishop and as my boss. So why are you doing this? The reality of what I saw really left me with no other option because at the end of my life, I'm not going to answer to Bishop Malone. I'm going to answer to God.
Took pictures with phone, used copy machine. Influenced by calls from dozens of abuse victims; bishop said not her concern. By last summer, "morally allergic."
Quit August, anonymously leaked to WKBW reporter.
There was no other way you saw to handle this? Not with any expediency, no. I mean, I did hope and pray that a grand jury would eventually be convened and that there would be hopefully an independent investigation, but I felt that there could be other victims between now and then, and I couldn't have that in my conscience if there was a way to prevent that.
March: Bishop agreed to release list of 42 priests accused of abusing minors, but O'Connor saw draft with more names. Found 300+ page binder of pending litigation in supply closet.
Bishop/lawyers decided not to reveal accused priests still in ministry. Attitude: protect church reputation/assets.
Father Arthur Smith missing from list: 2013 complaints of inappropriate touching two young men; 2011 counseling after contact with 8th-grade boy (unwanted attention, Facebook). Previous bishop removed him; Malone reinstated, endorsed for cruise ship chaplain.
I am unaware of anything in his background which would render him unsuitable to work with minor children. Our previous bishop had removed him from ministry, so I always thought it was odd that Bishop Malone had reinstated him. When I explored his file more in depth, that might have really been the moment when I knew that I had to do something with this information.
O'Connor docs: 118 priests facing claims of all types of abuse (credible accusations).
I felt that instead of being transparent, we were almost being the opposite, or half transparent. Here are the names that we would like you to know about, but please don't ask us about the rest.
Father Fabian Marianski: 1980s sexual relations with girl starting at 15. Note argued exclude him: "we did not remove him from ministry despite full knowledge of the case, and so including him on list might require explanation."
And I remember thinking, if that's the rationale for leaving a priest off, then... how can I abide by this?
Father Bob Zilliox, bishop's church law advisor on abuse cases, left role May, disgusted.
I think the hypocrisy, the lip service, you know, the, yes, Bob, I agree with you, and then I would walk out of an office and nothing would happen.
Many cases should have been handled differently, gone to Rome, at least 8-9 priests removed from priesthood; all still priests.
It's beyond troubling. That's not the church. The church is holy. Those are individuals in the church who are weak, who have made very bad decisions. And because of that, they need to be held accountable for what they've done.
Clergy brotherhood mindset: watch each other's backs. Zilliox abused at 13 by Buffalo priest.
It was very difficult in a lot of different ways. There's a certain respect that is owed to a bishop. But when I saw things take place the way they did, I sort of was conflicted within. I think as a victim, I have a bias, which is maybe not a healthy thing, but objectively, I have no tolerance for any abuse.
Bishop Malone motto: "live the truth in love." Declined interview.
Paul Snyder, deacon/hotel owner, first clergy calling for Malone resignation.
He's behaving in a way that you would typically think that a CEO in a corporation that's being accused of corrupt practices might act, hiding behind attorneys. Bishop Malone has called this a crisis. You call it a scandal. What's the difference? A crisis is, we look at our home and it's burning to the ground. A scandal is, while it's burning to the ground, you know how to put the fire up, but you don't tell me. You also know how the fire was caused, but you don't tell me. So you pretend to grieve with me about the fire, but the problem is, you caused it.
Received 400 notes/emails supporting. Sent letters to prominent bishops demanding investigation.
Why do you have faith that the bishops are going to handle this? Well, I don't have faith right now that any particular bishops have the courage to do the right thing. I mean, we all praise our martyrs on Sunday. And we praise and we sing. But boy, it sure as hell is hard being a saint when it's your ass on the line. And I want these cardinals and these bishops to start putting their ass on the line and start protecting their people.
Bishops hold supreme power, answer to pope. U.S. bishops to consider bishop code of conduct next month; Malone plans to attend, refused to resign.
The shepherd does not desert the flock at a difficult time.
Three public apologies, offered to sell 11,000-sq-ft residence for victims. Statement: reaching out to victims, removing clergy with substantiated allegations, cooperating with investigations.
In first 6 years, only 1 priest on leave; after scandal, suspended 16 more; none kicked out of priesthood.
He has said he's sorry. He has apologized. Mm-hmm. Do you forgive him? I accept it and I forgive him, but actions speak louder than words. Show us these cases are being handled properly. Show us the priests are being removed. You would like for Bishop Malone to resign? I would. I believe that it would be in the best interest of the diocese because he's had opportunities to enact, to enact real change, and he's let those opportunities come and go.
Money laundering: clever crooks hide/spend stolen money. Biggest scheme in history: nearly $230 billion suspicious money from Russia/former Soviet Union funneled into Western banking system by major U.S./Europe banks/regulators who facilitated or ignored.
Howard Wilkinson, Oxford man, mid-level executive at Danske Bank (Denmark's biggest, Estonia Tallinn branch). Cover blown last fall.
Being named as a whistleblower in a case involving dirty Russian money, it's not a good place to be. You've got to be, haven't you? The very nature of the people who want to launder money probably means that they're not the sort that you want to go down the pub and have a pint with.
Discovered branch's business: converting Russian rubles (questionable oil origin) to clean U.S. dollars.
Customers would be calling up every morning, please, I want to sell 20 million rubles and buy dollars. We would quote them the price for that. They would get the dollars. Basically, that was the large part of what we did. And there was nothing illegal about that? The banks are supposed to check the money coming in. Is it clean? And the banks are supposed to check where does the money go in the end. And you're saying it wasn't being done. Evidently, it wasn't being done.
Tallinn, Estonia: former Soviet republic, NATO member, next to Russia.
International money laundering laws require banks to know their customers and report suspicious transactions. Suspicious transactions were the vast majority of business in Danske Bank's non-resident portfolio, consisting of clients from Russia, Azerbaijan, and other former Soviet states. Much money came into the bank and left the next day. Customers called daily to sell rubles for dollars; the bank executed trades but did not vet clients. Wilkinson was assured a special committee screened international customers.
Wilkinson discovered issues accidentally when helping with paperwork for Lantana Trade LLP, a British company. He checked Companies House public register, paid £1, and found it listed as dormant (no transactions), despite bank statements showing up to $20 million a day. Public documents showed Lantana was British in name only, with a North London postal address shared with 64+ shell companies having Danske Bank Estonia accounts, connected to Seychelles and Marshall Islands. Owners were from those places; it was run by Russians. This screamed money laundering.
He informed bank staff handling Russian accounts; they called it a paperwork screw-up to be fixed. 13 months later, Lantana was told to take business elsewhere. Concerns included money laundering by Igor Putin (President Putin's cousin), links to FSB (KGB successor), and associations with bust Russian banks. Igor Putin has been linked to other schemes but claims innocence.
Wilkinson made a whistleblowing report to four senior executives, including an executive board member, about the issues. Concerned about cover-up, he checked three more British-registered customers: all false documents (£3 cost). Then 16 for 16 on 12 more (15 same address). Accounts looked identical, just changed numbers. Bank response: nothing. People stopped calling. A high-ranking executive said, > "this bank is not the police, the bank has no obligation to report false clients' accounts to the authorities."
Frustrated, Wilkinson resigned and returned to Britain with family.
Nearly five years later, after media prodding, Danske Bank reviewed 6,000+ non-resident accounts and acknowledged at a news conference its Estonian branch was gateway for largest money-laundering case in history: $230 billion. Wilkinson had only scratched the surface. Bank said almost all customers suspicious. 18+ former employees charged, including ex-CEO Thomas Borgen and CFO. Bank faces four counts violating Danish Anti-Money Laundering Act. Bank admits complete breakdown of all internal controls; entire system failed over years, profiting immensely.
Attorney Steven Cohn (Wilkinson's lawyer, 30+ years representing whistleblowers) says Danske not only profiter; $230 billion passed through big New York banks undetected. Major institutions worldwide complicit. Big banks needed for large-scale laundering, under Patriot Act and anti-terrorist rules. J.P. Morgan first suspected Russian money via Estonia, broke off; Deutsche Bank USA and Bank of America continued to 2015. Banks claim Danske responsible for customer due diligence. But J.P. Morgan figured it out; banks must ask questions on billions from small Estonian bank.
U.S. Justice Department and agencies investigating Danske, J.P. Morgan, Bank of America, Deutsche Bank USA (all cooperating, no interviews). Potential hundreds of millions in fines. Under U.S. whistleblower laws, Howard Wilkinson could share proceeds. He never imagined U.S. DOJ/SEC interest; bank should have investigated.
$230 billion dirty money originated beyond Moscow banks; ~1/3 Russian economy off-books from corruption, bribes, tax evasion by oligarchs, plutocrats, mafiosi. Now hidden in shell companies, tax havens, NYC/London real estate. Difficult to trace; Danske responsible for covering footprints like snow. Much harder in 2019.
Dr. Rick Bright, highest-ranking government scientist, charged federal COVID-19 response as slow, chaotic, prioritizing politics over science, costing lives and his job. In April, removed from top HHS position, transferred to lesser role. Filed 300+ page whistleblower complaint. Presidents Biden and Trump called him disgruntled. In congressional testimony, claimed retaliation for truth-telling. > "Our window of opportunity is closing. If we fail to improve our response now based on science, I fear the pandemic will get worse and be prolonged."
Bright led BARDA (Biomedical Advanced Research and Development Authority); Congress gave >$5 billion for vaccines, antivirals, supplies. BARDA focuses on chemical/biological threats (anthrax), nuclear/radiological, pandemic influenza, emerging diseases.
Early January, recognized pandemic signs in Wuhan virus: novel, infecting people, high mortality, spreading. Concerns shared by other scientists; NIH moved quickly on vaccine/antiviral. But urgency lacking across HHS. At Jan 23 meeting chaired by Secretary Alex Azar, only Bright said need vaccines, diagnostics, drugs ASAP. Complaint: Azar downplayed threat. Trump said Jan 30: > "We think we have it very well under control."
Leadership focused on containment (buys time, slows spread), but needed parallel prep. Crimson Contagion exercise (5 months prior) simulated fast-spreading China virus: lessons on shortages (PPE, N95 masks, gowns, goggles), funding needs. Drilled on Ebola, Zika, H1N1.
Industry warned daily of dry supply chain. Mike Bowen, Prestige Ameritech (Texas, one of few U.S. surgical/N95 mask makers), warned since 2007: 90% manufacturing shifted abroad. Predicted pandemic mask collapse, foreign cutoffs (exactly happened). Jan 22 emailed Bright: could reactivate lines for 7 million masks/month with gov help. Bright pushed to HHS daily; response passive (thanks, we'll handle).
Jan 25 Bright email: mask situation concern, warnings >1 week. Jan 26 Bowen: > "U.S. mask supply is at imminent risk. Rick, I think we're in deep sh..." Gov acted nearly 2 months later, ordering 500 million masks, pushed by Peter Navarro (Trade/Manufacturing Policy). Offshored critical supplies/medicines to save money; needs strategy, commitment, investment.
March, Trump touted hydroxychloroquine (tweet Mar 21: real chance biggest game changer). Bright: never thought game changer; data showed dangerous, negative effects, possible death. Mar 23 White House directive: drop everything, make widely available. Team tried limiting to hospitals; Bright shared concerns with reporter. Apr 21 reassigned to lesser NIH role. Believes retaliation for hydroxychloroquine concerns; last-ditch effort final straw.
HHS disputes: complaint one-sided; Bright requested EUA for hydroxychloroquine, signed FDA application. Bright: given directive, no choice or leave; signed knowing access contained.
Trump called him disgruntled. Bright: frustrated at leadership/urgency lack, scientists unheard. Won't return to BARDA but reports to NIH end May, will speak out. No national strategy; scientists lack clear leadership, remains chaotic.
David Nielsen, former manager at church's Ensign Peak Advisors, reveals church investments >$100 billion (largest religious fund in America). Alleges bent law, broke faith; clandestine hedge fund, not charity. Thought skills would build charity, do good; funds never used that way.
Recruited 2009 from Wall Street (devout Mormon) to firm near Salt Lake City HQ. Church collects ~$7 billion/year tithing (10% income). Tithing builds buildings, pays bills, operates programs. Leftover ~$1 billion/year to Ensign Peak reserve (non-profit, tax-free growth since 1997). Now >$100 billion (2x Harvard endowment or Gates Foundation).
Nielsen troubled: could solve big problems but just grew account. Bosses: for Second Coming. Publicly rainy day fund. 2013 doc: $1.4 billion to church-owned mall, $600 million to prop up for-profit Beneficial Life insurance. Charities can't bail for-profits without losing status.
Breaking point 2018: Mormon Leaks linked members to shell companies holding billions in stocks/bonds (actually Ensign Peak-controlled). Emergency meeting: entities to hide assets from members. Chief investment officer: reporting in own name would bring undue, damaging attention.
After a meeting, David Nielsen confronted a church official who warned that attention on Ensign Peak would be potentially damaging, stating, "Dave, we're going to lose our tax exempt status." Nielsen knew in that moment he was in the wrong place. He resigned in 2019 and filed a 74-page whistleblower complaint with the Internal Revenue Service (IRS), alleging that Ensign Peak violated its tax-exempt status.
Christopher Waddell, one of three church bishops who oversees finances, said Nielsen didn't have a full picture. Waddell stated, "As a Christian church, we believe that someday Jesus Christ will return. But that's not why we have those resources. It's for the continuing operation and for the future."
Nielsen alleged Ensign Peak violated tax-exempt status by directing money to church businesses. Waddell characterized the use:
- Church owned Beneficial Life and bailed it out during the 2008-2009 financial crisis using church resources.
- City Creek Mall was an investment, not a bailout, receiving returns.
The insurance company has paid back most bailout money, but the church would not disclose details of the deal or mall investment. Unlike other nonprofits, religious organizations don't fully disclose financial information to the IRS.
Waddell declined to share the value of Ensign Peak's assets, estimated at $150 billion. He confirmed, "We have significant resources." They manage money based on needs for years' worth in case of financial difficulties, not as a percentage.
Nielsen did not intend his IRS complaint to become public, but in 2019 his brother shared it with the Washington Post. He was shunned by friends and neighbors in Salt Lake City. In 2021, SEC investigators contacted him after a website story linked the church to shell companies.
Nielsen gave the SEC everything, helping them see the big picture. Firms with over $100 million in securities must file accurate SEC reports. In February, the SEC announced the Church of Jesus Christ of Latter-day Saints and Ensign Peak failed to do so, hiding $32 billion in securities over nearly 20 years using 13 shell companies with local phone numbers going to voicemail.
Back-office accountants who had never traded signed for non-existent portfolios. The SEC fined the church and Ensign Peak $5 million.
Bishop Waddell said church lawyers advised creating shell companies. On secrecy: "We don't feel it's being secret. We feel it's being confidential." Difference is point of view, to maintain focus on church mission rather than money amount. More transparency would lead to everyone telling them what to do with the money.
Last year, church spent over $1 billion on humanitarian aid, including food production. Average of nine transfers monthly from Ensign Peak to church fund operations, humanitarian work, education.
Nielsen: Ensign Peak funds never used for charitable purposes during his time. Waddell compared it to checking account vs. retirement account for different purposes.
Phil Hackney, former IRS Chief Counsel office and tax law teacher, said it's complex, gray area. Church gives millions in humanitarian work yearly. For private foundations, 5% of assets required. No clarity for public charities or churches; expects 2-3% spent to justify status. Without asset disclosure, rely on them behaving well.
Bailing out insurance company problematic if moving nonprofit money to for-profit. IRS investigation unlikely due to political risk, but risk to rule of law if not enforced.
Nielsen wants Ensign Peak Advisors to pay taxes on $100 billion tithing fortune; could get up to 30% reward if IRS collects. IRS doesn't comment on whistleblowers.
Nielsen: "It's time, Sharon. We gave the IRS and the SEC all the professional courtesy. This is just too important to fall through the cracks." "I know what I saw. I know what I know."
On Thursday night, Hurricane Helene with 140 mph winds made landfall in Florida's Big Bend. Deadly; full damage extent unknown for weeks. Rebuilding daunting.
Two years after Hurricane Ian hit southwest Florida, 50,000 homeowners battle insurance companies. Insurance insiders, licensed adjusters, say carriers used altered rules or damage reports to deceive after Ian.
Jeff Rapkin, adoption attorney in Northport, Florida (40 miles south of Sarasota), filmed Hurricane Ian (150 mph winds) from his porch. Storm sat overhead for 11 hours; steel roof ripped off, interior soaked, trees on house.
Rapkins lined up losses, called Heritage insurance. Adjuster assessed: house probably needs complete rebuild. But three months later, got $15,000 check (after $5,000 deductible and public adjuster fee, net $9,000). Report said $15,000 to restore to pre-hurricane condition.
Jordan Lee, licensed adjuster since 2017, inspected Rapkins: two-story home, metal roof blown off, interior soaked. Gave homeowners his cell number. Homeowners called angry.
Compared his report to what insurer sent: totally different. His: new roof needed, $231,368.57. Insurer: repair, $15,469.48. Desk adjuster (never visited) deleted sections but kept Lee's name and license.
No one alerted him to changes. Of 46 claims post-Ian, 44 altered, always downward (e.g., $488,000 to $13,000, $239,000 to $3,000; up to 98% less). None increased.
December 13, 2022: Lee and two others testified to Florida lawmakers about systematic criminal fraud. Scheme repeated on many estimates.
Ben Mandel, licensed since 2017, 18 of 20 reports altered for another carrier. Managers instructed to leave damage off, especially roofs: "We're not going to replace roofs, asphalt shingle roofs. We're going to repair them." Refused as illegal; got fired.
Six carriers in Florida did this. Mandel wrote roofs correctly.
Steven Bush, former public adjuster, represents six whistleblower adjusters. Carriers alter reports to force lawsuits for new roofs; most won't fight. Insurers know most roll over, playing odds and winning.
Florida market: national carriers exited after storms; regionals collapsed (9 since 2021). Evidence of manipulation in six states. Policyholders unaware; no transparency.
Doug Quinn, American Policyholders Association, started after Hurricane Sandy 2012 destroyed his home: Victims last to know. Carriers not allowed to shave 70-90% off claims by faking facts; disagree on minutiae only. Put fraudsters in handcuffs for change.
Bush gave evidence to state investigators; Florida opened criminal probe, no arrests two years later. Fraud on homeowners prosecuted quickly, but not carriers'.
50,000 Florida homes unrepaired post-Ian. Rapkins' home rotting, mold, sky visible through roof crack; pay mortgage, mow lawn, rent nearby, $4,000/year to Heritage (premiums up), can't switch.
Rapkins sued Heritage for breach and fraud. Heritage: aims to pay eligible claims, no intent to deceive. Random sample: 42% reports revised down, 26% up. Updated software; blames it for missing desk adjuster names.
Rapkin now thinks intentional: "I think they did it on purpose... This is a con. Make them go away at all costs and we're not paying."
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