Complete DHS Report for September 30, 2016
Daily Report
Top Stories
• Weatherford International agreed to pay $140 million September
27 to settle charges that the firm fraudulently lowered its year-end provision
for income taxes to align earnings with previously-disclosed projections. – U.S.
Securities and Exchange Commission
1. September
27, U.S. Securities and Exchange Commission – (Washington, D.C.) Oil
services company paying $140 million penalty for account fraud. The U.S.
Securities and Exchange Commission announced September 27 that Weatherford
International, an oil services company, agreed to pay $140 million to settle
charges that the firm fraudulently lowered its year-end provision for income
taxes by up to $154 million each year in order to align its earnings with its
previously-disclosed projections and effective tax rate. Source: https://www.sec.gov/news/pressrelease/2016-194.html
• The former president and chairman of the board at Gerova
Financial Group, Ltd. was convicted September 28 for defrauding the firm’s
shareholders out of roughly $72 million by diverting corporate stock to himself
and 6 co-conspirators from 2009 – 2011. – U.S. Attorney’s Office, Northern
District of New York See item 6 below in
the Financial Services Sector
• A NJ Transit train crashed at the Hoboken Terminal in New Jersey
September 29, killing at least 1 person and injuring up to 100 others. – WNBC
4 New York
8. September
29, WNBC 4 New York – (New York) 1 dead, up to 108 hurt in major Hoboken train
crash. NJ Transit train number 1614 traveling on the Pascack Valley Line
crashed through a bumper stop at the end of the platform at the Hoboken
Terminal in Hoboken, New Jersey, September 29, killing at least 1 person,
injuring up to 100 others, and causing extensive damage to the station. The
cause of the derailment remains under investigation. Source: http://www.nbcnewyork.com/news/local/Major-Train-Accident-in-Hoboken-Injuries-Reported-395249051.html
• Vibra Healthcare, LLC
agreed to pay $32.7 million September 28 to resolve claims that the firm
admitted multiple patients to 5 of its long-term care hospitals and 1 inpatient
rehabilitation facility who did not qualify for treatment at the facilities
between 2006 and 2013. – U.S. Department of Justice
16. September
28, U.S. Department of Justice – (National) Vibra Healthcare to
pay $32.7 million to resolve claims for medically unnecessary services. Vibra
Healthcare, LLC agreed to pay $32.7 million September 28 to resolve claims that
Vibra admitted multiple patients to 5 of its long-term care hospitals (LTCHs)
and 1 of its inpatient rehabilitation facilities (IRFs) who did not qualify for
treatment at the facilities, and extended the stay of LTCH patients to complete
medically unnecessary services between 2006 and 2013. As part of the
settlement, Vibra agreed to enter a corporate integrity agreement with the
Inspector General of the U.S. Department of Health and Human Services.
Financial Services Sector
6. September
28, U.S. Attorney’s Office, Southern District of New York –
(International) Former president and chairman of the board of Gerova
Financial Group, found guilty of defrauding shareholders. The former
president and chairman of the board at Gerova Financial Group, Ltd. was
convicted September 28 for defrauding the firm’s shareholders out of roughly
$72 million by secretly diverting corporate stock to himself and 6
co-conspirators without any legitimate business purpose from 2009 – 2011,
causing the former executive to personally accumulate over $2.6 million in illicit
earnings. The charges state that the former Gerova official intentionally
deceived the firm’s chief financial officer and other officers, causing the
company to conceal information about the stock scheme in its public filings
with the U.S. Securities and Exchange Commission, among other fraudulent
activities. Source: https://www.justice.gov/usao-sdny/pr/gary-hirst-former-president-and-chairman-board-gerova-financial-group-found-guilty
7. September
28, U.S. Department of Justice – (International) New York City
resident pleads guilty to using sham foreign entity and secret foreign accounts
in Switzerland and Israel to evade taxes. A New York resident pleaded
guilty September 28 to Federal and New York State tax evasion for tax years
2003 – 2005 and 2007 – 2010 by hiding more than $7.3 million in undeclared
financial accounts from 1987 – 2011 in Switzerland and Israel, as well as using
Contactus Partnership Associated S.A., a fake British Virgin Island entity, to
avoid paying over $650,000 in U.S. taxes. The charges allege the man
repatriated the funds by having an attorney draft a fraudulent agreement
between himself and Contactus, and wiring the funds into his attorney’s escrow
account. Source: https://www.justice.gov/opa/pr/new-york-city-resident-pleads-guilty-using-sham-foreign-entity-and-secret-foreign-accounts
For another story, see item 1 above in Top Stories
Information Technology Sector
20. September
29, SecurityWeek – (International) Syrian Electronic Army member pleads guilty
to hacking, extortion. A member of the Syrian Electronic Army (SEA) hacker
group pleaded guilty to Federal charges for his role in an extortion scheme
where he and another SEA member breached the systems of various organizations
in the U.S. and other countries and threatened to damage their computers and
data unless a ransom was paid. The FBI is searching for two other suspects involved
in the extortion scheme. Source: http://www.securityweek.com/syrian-electronic-army-member-pleads-guilty-hacking-extortion
21. September
27, SecurityWeek – (International) Apple confirms weakened security in local iOS
10 backups. Apple confirmed an issue affecting the encryption strength for
local backups of devices running on operating system (iOS) 10 after ElcomSoft security
researchers discovered a bug in iOS 10 that makes local backups more
susceptible to brute-force attacks than previous operating systems by allowing
for 6,000,000 passwords to be attempted per second, while iOS 9 only allowed
for 2,400 passwords to be attempted per second. Apple officials stated a patch
for the flaw would be released in an upcoming update. Source: http://www.securityweek.com/apple-confirms-weakened-security-local-ios-10-backups
Communications Sector
22. September
28, SecurityWeek – (International) Siemens patches flaw in SCALANCE products. Siemens
released an update for its SCALANCE M-800 industrial routers and SCALANCE S615
firewall versions prior to 4.02 resolving a medium severity vulnerability that
could allow a man-in-the-middle (MitM) attacker to obtain Web session cookies
and access potentially sensitive information. Source: http://www.securityweek.com/siemens-patches-flaw-scalance-products