Friday, September 30, 2016



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