Justice Department Targets Retired Gen. James E. “Hoss” Cartwright in Leak Probe

June 28, 2013

The Washington Post on June 27, 2013 released the following:

By Greg Miller and Sari Horwitz

“A retired four-star Marine Corps general who served as the nation’s second-ranking military officer is a target of a Justice Department investigation into a leak of information about a covert U.S.-Israeli cyberattack on Iran’s nuclear program, a senior Obama administration official said.

Retired Gen. James E. “Hoss” Cartwright served as deputy chairman of the Joint Chiefs of Staff and was part of President Obama’s inner circle on a range of critical national security issues before he retired in 2011.

The administration official said that Cartwright is suspected of revealing information about a highly classified effort to use a computer virus later dubbed Stuxnet to sabotage equipment in Iranian nuclear enrichment plants.

Stuxnet was part of a broader cyber campaign called Olympic Games that was disclosed by the New York Times last year as one of the first major efforts by the United States to use computer code as a destructive weapon against a key adversary.

Cartwright, who helped launch that campaign under President Bush and pushed for its escalation under Obama, was recently informed that he was a “target” of a wide-ranging Justice Department probe into the leak, according to the senior official, who spoke on the condition of anonymity because the investigation is ongoing.

Justice Department officials declined to comment on the case, as did Marcia Murphy, a spokeswoman for the U.S. attorney’s office in Maryland, which is in charge of the investigation.

Neither Cartwright nor his attorney, former White House counsel Greg Craig, responded to requests for comment.

The revelation, which was first reported by NBC News, means that an administration that has already launched more leaks prosecutions than all of its predecessors combined is now focused on one of its own. Since Obama took office, the Justice Department has prosecuted or charged eight people for alleged violations of the Espionage Act.

Cartwright was a regular participant in meetings of top national security officials at the White House and was thought to have significant influence with Obama before being passed over as a possible candidate to become chairman of the Joint Chiefs of Staff.

A target is a suspect in a criminal case who has not yet been indicted but is expected to be. Federal prosecutors are not required to tell targets that they are under investigation but it is not uncommon for them to do so in cases when an indictment is likely.

The investigation into the Stuxnet leak was launched in June 2012 by Attorney General Eric H. Holder Jr. and gained momentum in recent months amid indications that prosecutors were putting pressure on a range of current and former senior officials suspected of involvement.

The leaks surrounding Stuxnet exposed details about what had been one of the most closely held secrets in the U.S. intelligence community, an ambitious effort by the National Security Agency in collaboration with the Israeli government to devise computer code that could cripple Iran’s alleged effort to pursue a nuclear bomb.

The malware was designed to infiltrate Iranian computer networks and cause the nation’s centrifuges to spin out of control, causing damage to critical equipment and sowing confusion among Iranian scientists.

The campaign is believed to have destroyed as many as 1,000 of Iran’s 6,000 centrifuges at the time. But the virus also escaped those closed systems and was subsequently discovered on the Internet, raising concern about the potential that government-sponsored viruses could cause widespread and unintentional harm.

Cartwright, who previously served as head of U.S. Strategic Command, was a principal architect of the campaign. His role, a former senior official said in an interview last year, “was describing the art of the possible, having a view or vision.”

Cartwright, 63, went on to be named to the Pentagon’s No. 2 military post, moving him to the center of policy issues ranging from Iran to the pursuit of al-Qaeda in Pakistan and Yemen.

As vice chairman, Cartwright was scorned by many fellow senior generals for opposing a plan in 2009 to dispatch tens of thousands more troops to Afghanistan, putting him at odds with former peers, including Gen. David H. Petraeus, but earning him favor with senior Obama national security aides.

Although Obama forged a quick rapport with Cartwright — White House officials referred to him as the president’s favorite general — the president chose not to promote him to chairman in 2011, in part because of concern that Cartwright had frayed his relationships with too many senior generals during the surge debate. Within the Pentagon, “he wasn’t seen as a team player,” said a senior military official who worked on the Joint Staff.

After retiring, Cartwright took a position at the Center for Strategic and International Studies and has spoken frequently on national security issues. He has emerged as a growing critic of the Obama administration’s expanded use of drones to counter the al-Qaeda threat.

At at event in Chicago in March, Cartwright said that the United States was beginning to see “blowback” from that targeted killing campaign. “If you’re trying to kill your way to a solution, no matter how precise you are, you’re going to upset people even if they’re not targeted.””

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Homebuilder Indicted in an Alleged $14.7 Million Construction Investment Scheme

March 2, 2012

The Federal Bureau of Investigation (FBI) on March 1, 2012 released the following:

“BALTIMORE—A federal grand jury indicted Patrick J. Belzner, a/k/a “Patrick McCloskey,” age 42, of Glen Arm, Maryland, yesterday for conspiring to commit wire fraud arising from an investment fraud scheme. The indictment was unsealed today upon the arrest of the defendant.

The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Richard A. McFeely of the Federal Bureau of Investigation; and Acting Special Agent in Charge Eric C. Hylton of the Internal Revenue Service-Criminal Investigation, Washington, D.C. Field Office.

According to the indictment, from at least August 2009 to August 2011, Belzner, a homebuilder, and a co-conspirator also in the home building business, targeted individuals seeking investment opportunities or commercial real estate development lending. Belzner, who falsely presented himself as “Patrick McCloskey” with certain investors, instructed the victims that in order to obtain loans for commercial real estate projects, the purported lenders required that large sums of money be deposited in an escrow bank account to show “liquidity.”

The indictment alleges that in order to gain their victims’ confidence, Belzner and his co-conspirators caused victim investors and borrowers to enter into escrow agreements which stated that no person other than the victims had the ability to remove the escrowed funds without the victims’ permission. Belzner told the victims that a co-conspirator had to be the attorney assigned as the escrow agent.

The indictment alleges that Belzner and his co-conspirator fraudulently withdrew approximately $14,730,780 from the escrow accounts and used these stolen funds to satisfy their business and personal debts. To conceal their scheme, Belzner and his co-conspirators allegedly e-mailed fabricated bank statements to victims that misrepresented the escrow account balance and the date by when the investors’ money would be returned. Belzner and his co-conspirators also used funds fraudulently obtained from some victim investors to repay money owed to previous victim investors, or to other individuals to whom the conspirators owed debts.

The indictment seeks forfeiture at least $14,730,780, the amount of money stolen from victim investors.

Belzner faces a maximum sentence of 20 years in prison and a fine of $250,000 or twice the value of the gain or loss. Belzner had his initial appearance today in federal court in Baltimore.

An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.

This law enforcement action is part of President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

United States Attorney Rod J. Rosenstein thanked the FBI and IRS-CI for their work in the investigation. Mr. Rosenstein praised Assistant U.S. Attorneys Sean O’Connell and Sujit Raman, who are prosecuting the case.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.