Also to participate in discussions about NATO missions, anti-corruption efforts and immigration

WASHINGTON - May 29, 2011 - Senator Chuck Grassley is traveling this week to participate in meetings in Brussels and Moscow.  He said the trip provides an opportunity to address market access problems for soybean and pork producers in the United States and the need to protect intellectual property rights.  He also will receive a briefing on NATO-led efforts in Libya and Afghanistan, discuss anti-corruption efforts of Russian law enforcement in cooperation with U.S. authorities, address human rights and press freedoms, and discuss U.S. visa requirements for Russian travelers.

Of the trade issues for American agriculture, Grassley said, "Both the European Union and Russia are imposing non-tariff trade barriers against soybeans and pork produced by U.S. farmers for the export market.  The European Union's position on soybeans has created uncertainty for farmers, traders, co-ops and processors in the United States.  American farmers need the EU to engage in a dialogue to try to resolve an unfair situation.  Likewise, Russia's unjustified position against U.S. pork has delisted plants that account for 60 percent of U.S. pork production capacity.  I look forward to taking on both of these issues in meetings this week."

Grassley said he will deliver a letter on the soybean export dispute addressed to European Union Commissioner Karel De Gucht, the Directorate General for Trade.  The Renewable Energy Directive of the European Union relies on a faulty Brazilian model to establish emission savings and applying directive guidelines all the way down to the farm level.  Grassley said aggregate certification is needed as a fair trade matter for U.S. oilseed producers, along the lines of the sustainability requirement in the U.S. renewable fuel standard.

Separately, Grassley plans to deliver a letter about Russia's unjustified limits on U.S. pork addressed to First Deputy Prime Minster of the Russian Federation Igor Shuvalov and Aide of the President of the Russian Federation Arkady Dvorkovich.  Pork products from the United States face an array of sanitary phytosanitary restrictions by the Russian government.  Grassley said that if Russia is to gain membership in the World Trade Organization, which it is currently seeking, then Russia needs to abandon import restrictions, like this one, which are unscientifically based.  The United States was able to obtain commitments from China and Vietnam to overcome similar obstacles as part of those countries' accession to the World Trade Organization.  Twenty-five percent of all U.S. pork is produced in Iowa.

Grassley said that Russia's desire to join the World Trade Organization also should help to encourage Russian officials to improve enforcement efforts to protect intellectual property rights, which are important to promoting innovation, creating jobs and advancing economic growth.  He said the Senate-passed PROTECT IP Act that he sponsored this year with Senator Patrick Leahy of Vermont provides a model for working to stop online piracy and the sale of counterfeit goods.

In other meetings, Grassley said he will seek more information about possible outcomes for the NATO-led effort in Libya and how military operations have shaped those possibilities.  He also wants to ask for a NATO assessment of support from the Afghan people for the Karzai government, progress in eliminating government corruption, the capability of Afghan security forces, and the outlook for the strength of the Afghan National Army.

In Russia, Grassley said he is concerned about human rights abuses and efforts by government authorities to restrict media coverage and allow political pressure in the judicial system.

Grassley and others senators on the trip left Washington yesterday and will return on June 4.  Grassley is Ranking Member of the Senate Committee on the Judiciary.  He is a senior member of the Senate Agriculture Committee.  He is a senior member and former Chairman and Ranking Member of the Finance Committee, which has jurisdiction over international trade.


Feinstein, Grassley Release Senate Caucus on Int'l Narcotics Control Report on Mexico

Senators Urge Congress and Administration to use report as a blueprint for cooperation with Mexico to combat drug trafficking

Washington, DC - May 25, 2011 - U.S. Senators Dianne Feinstein (D-Calif.) and Chuck Grassley (R-Iowa), co-chairs of the Senate Caucus on International Narcotics Control, today released a report outlining key steps and initiatives to combat Mexico's brutal drug trafficking organizations and reduce violence in the country.

The report, U.S. and Mexican Responses to Mexican Drug Trafficking Organizations, is endorsed by all seven Members of the Senate Caucus on International Narcotics Control and makes several recommendations for the U.S. government.  The report synthesizes information gathered through a country visit, briefings, interviews, and a review of documents from both government and non-government subject matter experts.

"The United States provides counternarcotics assistance throughout the world, but our security partnership with Mexico is unique since we share a 1,969 mile border," said Senator Feinstein.


"What happens in Mexico has a deep impact on the United States and the reciprocal is also true. Today, U.S. - Mexico ties are stronger than ever, and we must take advantage of this historic moment by continuing to deepen our security partnership with Mexico," continued Feinstein. "I urge my colleagues in Congress and members of the Obama Administration to read this report and use it as a blueprint for future cooperation with Mexico to combat drug trafficking."


"The drug trade has long been associated with violence, but the recent escalation has been unprecedented. Stopping this violence will take cooperation from those of us on both sides of the border," Senator Grassley said. "And, while more work needs to be done in this area, this report can be a guide as we move forward and work to curb the drug trade and the violence associated with it."

Findings and recommendations of the report include :

Money Laundering

  • The report calls on the Obama Administration to do more to starve Mexico's drug trafficking organizations of the money that fuels them.  Specifically, it urges the Obama Administration to immediately make pre-paid gift and credit cards - known as stored value - subject to cross-border reporting requirements.

Stored value is not subject to any cross-border reporting requirements.  This means that an individual crossing from the United States into Mexico with thousands of dollars on pre-paid cards is not required to declare these cards at the border.

Mérida Initiative

  • The report calls on the State Department to expedite the delivery of air assets to Mexico under the Mérida Initiative, a security assistance program that includes air assets, other equipment and training.
  • It also recommends that the State Department quickly develop performance measures for the Mérida Initiative and provide these metrics to Congress.  A multi-year timeline should be developed with targets in several areas, including equipment delivery, judicial and police reform, and state capacity to respond to drug trafficking organizations.

The U.S. government has provided vital security assistance to Mexico, including 11 helicopters - eight Bell 412 helicopters for the Mexican military and three Blackhawk helicopters for the country's federal police.  Six more Blackhawk helicopters are still in the pipeline.

Justice Reform

  • The report concludes that in order to have long-term success in combating organized crime, much-needed judicial reforms must be implemented throughout Mexico.

According to data from the Mexican government, 1.55 percent of suspected crimes in Mexico result in convictions.  By comparison, the U.S. federal courts logged a 90.3 percent conviction rate in FY 2008.

The report recommends that judicial sector training be proactively offered by the United States through the Mérida Initiative to each Mexican state that requests it.  This should include specific training on oral trial topics, such as evidence, opening and closing statements, direct and cross examination and objections.

Southbound Inspections

  • The report asks the Departments of Justice and Homeland Security to conduct and submit to Congress an assessment of immediate infrastructure and staffing needs at the Southwest border - including important tools like License Plate Readers - and activities and resources by the Mexican Government to stand-up southbound inspections on the Mexican side of the border.

Border Tunnels

  • The report calls on Congress to pass legislation to enhance the 2007 law that criminalizes the financing, construction and use of border tunnels.  The legislation proposed in the report would increase prosecutorial options by criminalizing conspiracy to use, construct or finance a border tunnel.  The Caucus also recommends that illegal tunneling be included as an offense eligible for Title III wire interception.

Cross-Border Kidnappings

  • The Caucus's report calls on the FBI to develop and sponsor a vetted unit with trusted Mexican counterparts who have the expertise to conduct investigations of the kidnappings of U.S. citizens.

The entire report can be found here:  U.S. and Mexican Responses to Mexican Drug Trafficking Organizations


SEC approves whistleblower rules

Wednesday, May 25, 2011

Sen. Chuck Grassley of Iowa helped to enact provisions beefing up the Securities and Exchange Commission's treatment of whistleblowers.  Earlier, Grassley was the Senate author of the 1986 whistleblower amendments to the federal False Claims Act, which has become one of the government's most powerful tools against fraud.  He also was key to improving the IRS' whistleblower office.  He made the following comment on the SEC's approval today of new rules giving whistleblowers incentives to come forward about financial fraud.

"In general, there's a long history of retaliation against whistleblowers.  To come forward, they need protection and independence from the operation that's potentially doing wrong.   The SEC took a step in the right direction today.  A whistleblower might prevent the next Madoff.   Twenty years ago, the Justice Department resisted whistleblowers.  Since then, whistleblowers have helped the department recover $28 billion that otherwise would have been lost to fraud.  More recently, there was a lot of skepticism about beefing up the IRS' whistleblower incentives.  That office recently recovered $20 million for the taxpayers in the first reward under the new set-up.  Both of these programs faced some of the same criticisms facing the SEC program but the concerns were overstated.   Now, the SEC needs to break away from its past of resisting whistleblowers.  It needs to make sure whistleblowers are taken seriously and that their complaints are given the attention needed to prevent fraud."


Grassley Elicits Confirmation of Risk to U.S. Market Share Over Korea Trade Agreement Delay

WASHINGTON -- May 25, 2011 - In response to a question from Sen. Chuck Grassley, a top U.S. trade official confirmed today that U.S. agricultural producers are indeed at risk of losing valuable market share in Korea to the European Union because the United States has not implemented its pending Free Trade Agreement with Korea, and the European Union has implemented such an agreement.  The White House and congressional allies continue to move the goal posts on the necessary conditions for implementing pending trade agreements, to the detriment of U.S. producers.

The exchange occurred at a hearing of the Finance Committee, with jurisdiction over international trade.  Grassley is a senior member and former chairman and ranking member of the committee.

A video clip is available here.

The text of a Senate floor speech Grassley delivered today on the value of trade agreements is available here.


WASHINGTON - Senator Chuck Grassley said U.S. Senate approval last night of a resolution that designated May as National Foster Care Month for the 23rd consecutive year helps to raise awareness about the challenges facing children and families in the foster care system.  Nationwide, approximately 420,000 children live in foster care, including about 6,000 children in Iowa.  There are more than 2,700 foster parent families in Iowa.

"We need to keep the spotlight on the children and families in the foster-care system," Grassley said.  "States need incentives to make improvements, and the effort needs to continue to move more children from what should be a temporary place in the system to permanent, loving homes.  Disruptions, uncertainty and constant changes in their surroundings make it harder for children in foster care to succeed in school and access opportunities to learn and grow in positive ways."

Grassley is the lead Republican sponsor of the resolution, which was introduced by Senator Mary Landrieu of Louisiana.

Last year, Grassley and Landrieu founded a Senate Caucus on Foster Youth to focus on those who have recently aged out of the foster care system and lack the support of a family.  Previously, they worked together to pass a landmark 2008 overhaul of child welfare law, including new incentives for states to move children from foster care to permanent, adoptive homes.  The reform initiative made it easier for children to be adopted by family members, including grandparents, and made all children designated as special needs, which in adoption includes older children, eligible for federal adoption assistance.  The Fostering Connections to Success and Increasing Adoptions Act of 2008 also established educational and vocational opportunities for youth when they transition out of the foster care system at age 18.  Much of this legislation fell within the jurisdiction of the Senate Committee on Finance, where Grassley served as Chairman and Ranking Member during the last decade.  He remains a senior member of the committee.  He previously sponsored tax incentives to encourage and increase adoptions, as well.

Grassley said that policymakers also should recognize the "selfless contribution of tens of thousands of Americans who provide safe haven and open their loving homes as foster care parents to children in the foster care system.  One person at a time, so many foster care parents make a tremendous contribution."

Click here to read the Senate resolution adopted last night.


Leahy, Grassley, Feinstein, Chambliss Introduce Bill To Extend Mueller's Term

WASHINGTON - May 26, 2011 - The top Democrats and Republicans of the Senate Judiciary Committee and Senate Select Committee on Intelligence introduced legislation Thursday to address President Obama's request to extend the term of FBI Director Robert Mueller for two years.

Judiciary Committee Chairman Patrick Leahy (D-Vt.) and Ranking Member Chuck Grassley (R-Iowa), and Intelligence Committee Chairman Dianne Feinstein (D-Calif.) and Vice Chairman Saxby Chambliss (R-Ga.) introduced a bill to provide a one-time extension of Mueller's service.

Earlier this month, President Obama requested that Congress enact a one-time extension of Mueller's term, which is limited to 10 years by statute.  Mueller assumed the post of FBI Director just one week before the September 11, 2001, terrorist attacks; his term is set to expire September 3.

"Bob Mueller has served tirelessly and selflessly for 10 years, and is undoubtedly ready to begin the next phase of his life," said Leahy.  "But he has characteristically answered duty's call and indicated his willingness to continue his service.  We should fulfill our duty, as well, and join together without delay to secure the continuity and stability that is demanded at this time, and that is needed to keep our country safe."

"The ten-year term for an FBI director is good for the agency and our country.  It was designed to insulate the FBI Director from the political process and ensure that no one Director amass too much power.  It has worked for thirty-five years.  But, we live in extraordinary times.  Given the complex and uncertain time we live in, the good work of Director Mueller following September 11, and a heightened alert to terrorist attack following the death of Osama Bin Laden, this one-time statutory exemption that will extend the term of FBI Director Mueller's term by two years is the right decision.  I do this with trepidation, though, because of the constitutional and precedential concerns associated with this action," Grassley said.  "I look forward to a hearing in the Judiciary Committee so we can address those concerns."

"During the last decade, Robert Mueller has provided steady leadership and stability at the FBI.  He has worked to transform the culture of the Bureau into an agency that can better identify and prevent terrorist attacks against the United States," said Feinstein.  "Under his leadership, the FBI has played an essential role in more than 20 significant counterterrorism operations, while infiltrating and arresting individuals charged with planning attacks against our country. Extending Director Mueller's term at the FBI for an additional two years will ensure the transition at the FBI continues and will provide important stability to the President's national security team during this sensitive and challenging time."

"In addition to leading our crime-fighting efforts inside the United States, the FBI plays a critical national security role," said Chambliss.  "Director Mueller has done an outstanding job ensuring the American people remain safe from domestic attacks.  In light of Osama bin Laden's death, the approaching 9/11 anniversary, and the leadership transitions occurring at the Pentagon and the CIA, I believe granting a one-time, two-year extension of Director Mueller's term is the right thing to do."

The legislation will be referred to the Senate Judiciary Committee for consideration.  The text of the legislation is available here.



[WASHINGTON, D.C.] - May 26, 2011 - After learning that an internal task force at the Army Materiel Command (AMC) is considering relocating Rock Island Arsenal's Joint Manufacturing and Technology Center (JMTC), a bipartisan group of lawmakers from both the Illinois and Iowa Congressional Delegations called for a meeting with the Secretary of the Army, John McHugh, as soon as possible to discuss their concerns about the cost associated with conducting such a move as well as the impact it would have on the Rock Island Arsenal.

Members signing on to today's letters include : U.S. Senators Dick Durbin (D-IL), Mark Kirk (R-IL), Chuck Grassley (R-IA) and Tom Harkin (D-IA) along with U.S. Representatives Bobby Schilling (R-IL-17), Dave Loebsack (D-IA-02) and Bruce Braley (D-IA-01) .

"It is our understanding that the Army Materiel Command (AMC) has formed an internal task force charged with cutting $3 billion from the overall AMC budget. These recommendations are due in July as part of an Army-wide effort to find savings in a time of tight budgets.  We understand that closing Joint Manufacturing and Technology Center (JMTC) is a potential approach being considered by this task force," the Members wrote. "Given the urgency of this matter, we request a meeting with you as soon as possible to discuss these matters as they may impact Rock Island."

The Rock Island Arsenal Joint Manufacturing and Technology Center (JMTC) is a one-of-a-kind U.S. Army facility which manufactures critical equipment for our troops around the world. The more than 1,700 individuals employed at JMTC specialize in manufacturing artillery, armor, small arms, and mobile maintenance kits for use on the front lines. The JMTC, perhaps best known for howitzer production, operates the Army's only foundry and since 2003 has produced half of all armor for Army tactical wheeled vehicles. Veterans make up more than half of JMTC's highly-skilled workforce.

A similar letter was sent to General Ann Dunwoody, the Commanding General of the Army Material Command which oversees the JMTC's operations and would have firsthand knowledge of the internal task force. Today's letters follow up on a previous request to meet with General Dunwoody who is not available to meet until July, the same month the task force will report its cost-cutting recommendations.

[Text of the letters below]

May 26, 2011

Dear Mr. Secretary:

We hope to meet with you as soon as practicable to discuss the importance of Rock Island's Joint Manufacturing and Technology Center to the Quad Cities region.

It is our understanding that the Army Materiel Command (AMC) has formed an internal task force charged with cutting $3 billion from the overall AMC budget. These recommendations are due in July as part of an Army-wide effort to find savings in a time of tight budgets.  We understand that closing Joint Manufacturing and Technology Center (JMTC) is a potential approach being considered by this task force.

As you know JMTC is a state of the art manufacturing facility that can rapidly respond to warfighter needs.  It has produced armor that protected our troops overseas and has produced almost every howitzer in the Army inventory.  JMTC employs more than 1,700 jobs and is an anchor in the local and regional economy.

Given the urgency of this matter, we request a meeting with you as soon as possible to discuss these matters as they may impact Rock Island.

May 26, 2011

General Ann E. Dunwoody

Commanding General

US Army Material Command

9301 Chapek Road

Fort Belvoir, VA 22060

Dear General Dunwoodie:

Earlier this month, we requested a meeting with you through the Army Liaison's Office but were told you would not be available until July at the earliest.  However, recent events highlight the need for this meeting to take place as soon as possible.  It is our understanding that Army Materiel Command (AMC) has formed an internal task force charged with cutting $3 billion from the overall AMC budget, which will report its recommendation in July.   We understand that closing Joint Manufacturing and Technology Center is a potential approach being considered by this task force.

Given the urgency of this matter, we request a meeting with you as soon as possible and would be happy to host you in Washington as early as this Friday, May 27, 2011.



Thursday, May 26, 2011 

Senator Chuck Grassley, Ranking Member of the Senate Judiciary Committee, made the following statement after the Senate voted to extend the USA PATRIOT Act.

"The Senate vote was a reaffirmation of the importance of these expiring authorities that help secure our nation.  The three expiring provisions have provided a great deal of information to agents that have helped thwart terrorist attacks while protecting legitimate privacy and constitutional rights. Now, I hope the House will give the agents the certainty and predictability they need to use these tools to collect critical intelligence in the War on Terror."


SEC leasing deal was disastrous?, Grassley says

Tuesday, May 24, 2011

Sen. Chuck Grassley of Iowa today made the following comment on a new inspector general report saying the U.S. Securities and Exchange Commission faces a $94 million claim after it backed out of a deal to lease office space in Washington, D.C.  The report is available here.  Grassley has a longstanding interest in conducting oversight of agencies including the SEC to help make sure the agencies function well on behalf of taxpayers and in the SEC's case, investors as well as taxpayers.

"The report portrays the SEC's leasing operation as incompetent in just about every way.   The report says employees grossly over-estimated the amount of needed space, maneuvered around leadership's concerns, and even backdated a key document to justify their decision.  The taxpayers might be on the hook for nearly $100 million as a result of this mismanagement.  Everyone who's responsible needs to be held fully accountable.  The agency needs to get a handle on its leasing operation to make sure this kind of mess doesn't happen again."

"Holding Criminals Accountable: Extending Criminal Jurisdiction to Government Contractors and Employees Abroad"

Wednesday, May 25, 2011
      Mr. Chairman, thank you for holding today's hearing to discuss extending federal criminal law to government contractors and employees serving overseas.  This is an important topic given the increased use of government contractors by federal agencies in overseas operations, including Afghanistan and Iraq.  Holding any individual accountable for crimes is an important part of the Judiciary Committee's jurisdiction. 
      I think we all would agree that anyone who commits a crime should be held accountable and that bringing criminals to justice is one of the most important roles of government.  However, extending the long arm of American criminal law is an issue that should not be done without significant consideration and caution. 
      Chairman Leahy and I have worked together in the past to ensure that government contractors are not given a free pass to commit crimes or to defraud the government from resources that are entrusted to our country by other nations.  We worked together in 2008 on the Wartime Enforcement of Fraud Act that would have tolled the statute of limitation on fraud offenses that occurred in a war zone. 
      We also worked together to amend the False Claims Act to ensure that funds that were under the trust or administration of the United States government were protected from fraud and abuse.  That fix was necessary to address a loophole created by the courts in the Custer Battles decision where Iraqi funds administered by the U.S. government were subjected to fraud.  This was a damaging loophole because it essentially said that contractors were free to defraud the government as long as the money was from a foreign country that entrusted the U.S. government to administer it.  Ultimately, we closed that loophole in the Fraud Enforcement Recover Act which was signed into law by President Obama.
      Today's hearing is no less important because criminal acts committed by U.S. citizens and contractors abroad could threaten our foreign relations.  As such, it is right for us to examine the ways we can bring these criminals within the reach of the law.  Legislation extending the reach of U.S. criminal law to contractors was introduced in the 110th and 111th Congresses.  Both times, that legislation failed to clear both chambers and was never signed into law. 
      Chief among the concerns with the legislation was the lack of a clear exception for contractors that were employed by the intelligence community.  In 2007, President Bush issued a Statement of Administration Policy citing concerns with legislation expanding extraterritorial jurisdiction over contractors and citing concerns with the impact on national security activities and operations.  Similar concerns held up legislation in the last Congress as well. 
      I think there is a lot of merit to extending our criminal law to civilian contractors and employees abroad.  However, we must make sure that this is done in a manner that is narrowly tailored to the specific problem and is not overly broad.  Further, we must ensure that we do not harm critical national security and intelligence operations abroad.  Those concerns should be addressed in a proper forum and not necessarily aired in public.  However, in the limited scope we can address that topic in a public forum, I intend to ask some questions about what a carve-out for the intelligence community should look like. 
      I also want to know about how many new resources the Department of Justice will require to implement investigations and prosecutions under a proposed expansion of extraterritorial jurisdiction.  Given the current fiscal situation of the federal government, I am concerned that reallocating resources from one side of the Justice Department to another could limit other investigations and prosecutions. 
      I look forward to hearing the testimony of the witnesses, asking some of these important questions, and working with the Chairman and members of the committee on this important topic.  Thank you.   
Immigratio?n-B-1 Visa Program Used to Avoid Requiremen?ts of Other Programs

Wednesday, May 25, 2011
Senator Chuck Grassley released the following comment after receiving a response to his April 14, 2011 inquiry to the departments of State and Homeland Security about the use of the B-1 visa program by employers to recruit foreign workers who are then not subject to the cap and the prevailing wage requirements of the H-1B program.  The response by the State Department said the agency is working with the Department of Homeland Security to eliminate or amend the B-1 in Lieu of H-1B policy in the Foreign Affairs Manual.  Grassley is still waiting for a response from the Department of Homeland Security.
"It appears the B-1 visa program has become a subterfuge for companies wanting to avoid the cap and wage requirements of the H-1B visa, so it's good to see the State Department acknowledge the need for greater fraud prevention in the visa approval process as well as changes to policies that incentivize employers to go around the H-1B program in the Foreign Affairs.  The State Department's efforts are a step in the right direction, but more work will be needed in this area to ensure the integrity of our visa programs.  This includes the ability for the department to maintain accurate statistics that will help us understand how we can better close loopholes to make sure that American workers are given first priority for jobs."   
The State Department's response to Grassley can be found by clicking here.  Below is a copy of the text of Grassley's April 14th letter to the departments of State and Homeland Security.
For Immediate Release
Thursday, April 14, 2011
Grassley Concerned That Companies are Using B-1 Visa Program
to Circumvent H-1B Requirements
            WASHINGTON - Senator Chuck Grassley is asking for a thorough investigation by the Departments of State and Homeland Security of the B-1 visa program and the use of this visa program by employers to recruit foreign workers who are then not subject to the cap and the prevailing wage requirements of the H-1B program.
            "When unemployment remains at a staggering 8.8 percent, we should be focusing our oversight efforts on employers who are taking advantage of the system and importing foreign workers to the detriment of Americans," Grassley said. 
            In his letter to Secretary of State Hillary Clinton and Secretary of Homeland Security Janet Napolitano, Grassley questioned the "B-1 in lieu of H-1B" policy currently in place.  He wrote, "Under this low threshold (of the B-1 visa), a company could import workers via the B-1 business visitor visa and evade the H-1B visa cap and prevailing wage requirements that would otherwise apply to such workers so long as the workers could show that their paychecks were still coming from the foreign company." 
            Grassley also referenced a formal complaint against Infosys that details how Infosys management in India decided to use the B-1 business visitor visa program to get around H-1B program restrictions.  The plaintiff alleges that Infosys was importing foreign workers as B-1 business visitors under the guise of attending meetings rather than working for a wage as an employee of a U.S. company, which is forbidden under the statute and regulations governing the B-1 visa program.
Grassley argues that American workers should be given first consideration by companies looking to import foreign workers.  Grassley has led the effort to close loopholes and enact reform in the H-1B visa program.  He has introduced legislation in previous Congresses to reform the H-1B and L visa programs and is planning on introducing a bill again in the 112th Congress.
            Here is a copy of the text of Grassley's letter.  A signed copy can be found here.
April 14, 2011
The Honorable Hillary Rodham Clinton
U.S. Department of State
2201 C Street NW
Washington, D.C. 20520
The Honorable Janet Napolitano
U.S. Department of Homeland Security
245 Murray Lane, Mailstop 0150
Washington, D.C. 20528-0150
Dear Secretary Clinton and Secretary Napolitano:
I'm very concerned about fraudulent actions that at least one foreign-based company has allegedly been taking in order to get around the requirements and U.S. worker protections of the H-1B visa program, and more generally, about provisions in current guidance to visa adjudicators that actually authorize such evasion of Congressional intent. 
On February 23, 2010, a U.S. employee of Infosys Technologies Limited, Inc. ("Infosys") filed a complaint in the Circuit Court of Lowndes County, Alabama, alleging that his employer was "sending lower level and unskilled foreigners to the United States to work in full-time positions at Infosys' customer sites in direct violation of immigration laws."  The plaintiff described ways that Infosys, one of the top ten H-1B petitioning companies, had worked to "creatively" get around the H-1B visa program in order to bring in low-skilled and low-wage workers, resulting in visa fraud against the U.S. Government.
Infosys, by its own admission, is an "H-1B dependent employer."  Under the Immigration and Nationality Act, H-1B dependent employers must take good faith steps to recruit U.S. workers and to offer them compensation that is at least as great as that required to be offered to H-1B nonimmigrants.
The formal complaint against Infosys details how Infosys management in India decided to use the B-1 business visitor visa program to get around H-1B program restrictions.  The plaintiff alleges that Infosys was importing foreign workers as B-1 business visitors under the guise of attending meetings rather than working for a wage as an employee of a U.S. company, which is forbidden under the statute and regulations governing the B-1 visa program. Under section 101(a)(15)(B) of the Immigration and Nationality Act, a B-1 visa holder may not come to the U.S. "for the purpose of...performing skilled or unskilled labor."  Under State Department regulations, a B-1 visa holder may not engage in "local employment or labor for hire."  If the allegations against Infosys are substantiated, American workers will have been hurt by this company's fraudulent actions, and the integrity of both the B-1 and H-1B visa programs will have been compromised.
More troubling than the illegal ways a company can get around the H-1B program's restrictions using the B-1 visa program are the legal ways companies can use the B-1 visa program to defy the intent of Congress.  For example, the State Department's Foreign Affairs Manual (FAM) currently authorizes the granting of B-1 visas to foreign workers who should otherwise be seeking H-1B visas in cases where the worker is employed by a foreign company and is coming to the U.S. to work at a U.S. client of that foreign company.  Specifically, the FAM states that to qualify for such B-1 in lieu of H-1B visas, "the employee must customarily be employed by the foreign firm, the employing entity must pay the employee's salary, and the source of the employee's salary must be abroad."  Under this low threshold, a company could import workers via the B-1 business visitor visa and evade the H-1B visa cap and prevailing wage requirements that would otherwise apply to such workers so long as the workers could show that their paychecks were still coming from the foreign company.  I believe a thorough review of the "B-1 in lieu of H-1B" provision in the Foreign Affairs Manual is warranted by both of your Departments, especially at a time when American workers are vying against foreign workers for employment in this country.
In light of the allegations against Infosys, and the potential for other employers to abuse the B-1 visa to get around the H-1B visa program, I would appreciate your cooperation to get to the bottom of the situation.  I would also like information about how the B-1 visa is being used by employers and processed by consular officers, including the following:
Statistics with regard to the numerical distribution of B-1 visas, including which employers are using them, how many B-1 visas are petitioned for and approved each year, and the lengths of time a visa holder remains in the United States on a B-1 visa.
The number of "B-1 in lieu of H-1B" visas issued each year for the past five years, including the posts where such visas were issued, the U.S. companies hosting such workers, and the foreign companies paying the worker's salary.
How does the Department of State verify an employer's claim that a B-1 visa holder will attend a meeting, convention, or other business appointment in the United States? 
What actions, if any, are being taken against employers who abuse the B-1 visa program?  Will the Departments consider barring such employers from any visa program if found guilty of misusing the visa system?  Will the Departments cease to approve visas for Infosys until the lawsuit in Alabama is settled?  If not, what additional oversight and/or actions will be taken until the Infosys lawsuit is finalized?
What is the legal basis for the State Department's policy known as "B-1 in lieu of H-1B"?  The Immigration and Naturalization Service, in 1993, proposed a regulation to eliminate the "B-1 in lieu of H" category citing inconsistency with Congressional intent.  Will the Department consider changes to the Foreign Affairs Manual so that this means of entry is not abused?  Will the Department consider eliminating this provision altogether?  How does the Department of Homeland Security feel about this State Department policy today? 
My hope is that your Departments will cooperate to make sure that the B-1 visa program is not being abused by employers who wish to get around the annual caps and prevailing wage requirements imposed by the H-1B visa program.  I look forward to your review of the issues I have raised, and would appreciate a response to my questions no later than April 28, 2011. 
                                                            Charles E. Grassley
                                                            United States Senator

Prepared Floor Statement of Ranking Member Chuck Grassley on the Motion to Proceed to the USA PATRIOT Act Extension

Monday, May 23, 2011

Mr. President.  We find ourselves again in the situation of extending key provisions of the USA PATRIOT Act.  These three provisions, roving wiretaps, section 215 business record orders, and the lone wolf provision are important tools used to investigate and prevent terrorist attacks.  They have been reauthorized a number of times, but it seems that in recent years we've been discussing only short term extensions of these critical tools.

That is why I will support the cloture petition on moving to S.1038 today.  This legislation provides a four-year extension of the three expiring provisions without any substantive changes to the existing authorities.

Regardless of my support for today's cloture vote, I support a permanent extension of the three expiring provisions.  Having this debate year after year offers little certainty to agents utilizing these provisions to combat terrorism.  It also leads to operational uncertainty, jeopardizes collection of critical intelligence, and could lead to compliance and reporting problems if the reauthorization occurs too close to the expiration.

If we believe these tools are necessary, we need to provide some certainty as opposed to simply revisiting the law year after year.  Given the indefinite threat we face from acts of terrorism, it is my view that we should permanently reauthorize these three expiring provisions.

This position is supported by the agents on the ground using these tools every day.  I have letters of support from the Federal Bureau of Investigation Agents Association supporting a permanent reauthorization of the three expiring provisions.  The Federal Law Enforcement Officers Association also supports a permanent extension of the provisions.

In fact, a very important passage of that letter states, "Crime and terrorism will not "sunset" and are still targeting our nation and American citizens.  Just like handcuffs, [the PATRIOT Act] should be a permanent part of the law enforcement arsenal."  Another letter from the Society of Former Special Agents of the Federal Bureau of Investigation adds, "We urge Congress to reauthorize the expiring provisions of the Patriot Act permanently and without restrictions as the three expiring provisions are essential to the security of our country."  Mr. President, I ask unanimous consent to make these letters a part of the record.

In addition to the agents on the ground, we've heard strong support for extending the expiring provisions of the PATRIOT Act from members of the Bush and Obama administrations.  We've heard testimony from the Director of the FBI, the Attorney General, and the Director of National Intelligence about the strong need to reauthorize these provisions.  These same offices have recommended extending the provisions regardless of political ideology as both Republican and Democrat administrations have backed the extensions.

The four-year extension we are voting on today is a step in the right direction.  Extending the three expiring provisions, without any substantive amendment that would restrict or curtail the use of these tools, is important given the recent actions that led to the death of Osama Bin Laden.  Now is not the time to place new restrictions and heightened evidentiary standards on critical national security tools.

A lot has been said about these provisions and unfortunately most of what has been said is incorrect.  Congress enacted these provisions and reauthorized them in 2005 following the 9/11 Commission report which criticized the way our agents failed to piece together clues.  Since that time, the three expiring provisions have provided a great deal of information to agents that have helped thwart terrorist attacks.

For example, in testimony before the House Judiciary Committee, Subcommittee on Crime, Terrorism, and Homeland Security, Robert Litt, the General Counsel from the Office of the Director of National Intelligence testified that a section 215 order was used as part of the investigation by the FBI into Khalid Aldawasari who was arrested in Texas.  It was later revealed in the criminal case that he was purchasing explosive chemicals and bomb making components online and had scouted targets in Texas.

Mr. Litt also testified that section 215 orders were utilized to obtain hotel records in a case where a suspected spy had arranged lodging for intelligence officers.  He also discussed the roving wiretap provision and how it is used to help agents track foreign agents operating inside the United States who switch cellular phones frequently.  These examples are limited not because the authorities aren't valuable, but because of how sensitive the investigations are that utilize these authorities.

While the need for keeping national security matters classified may prevent the open discussion of further examples in this setting, it is important to note that these provisions are constantly under strict scrutiny by the Inspector General at the Department of Justice and by congressional oversight.  In fact, in a March 2008 report, the Justice Department Inspector General examined the FBI's use of section 215 orders and found, "We did not identify any illegal use of section 215 authority."  Further, there are no reported abuses of the roving surveillance authority. And the "lone wolf" provision has not yet been utilized, so it is without abuse as well.

While I agree that these three provisions should be subject to strict scrutiny from inspectors general and Congress, that oversight authority already exists in the law and does not require amendment to these tools to achieve that goal.  As such, it is important that Congress reauthorize these provisions quickly and without amendment.

I urge my colleagues to vote in support of the cloture petition on the motion to proceed on S.1038 because it provides a clean reauthorization of these vital tools for four-years without substantive changes.  While four-years is a far cry from the permanence that I feel is necessary on these provisions, it does provide more certainty and predictability than continuing to pass short term extension after extension.

I yield the floor.



Prepared Hearing Statement of Ranking Member Chuck Grassley, Senate Committee on the Judiciary

Subcommittee on Crime and Terrorism

"Responding to the Prescription Drug Epidemic: Strategies for Reducing Abuse, Misuse, Diversion, and Fraud"

Tuesday, May 24, 2011

Mr. Chairman, the abuse of prescription narcotics, such as pain relievers, tranquilizers, stimulants, and sedatives, is currently the fastest growing drug abuse trend in the country.

Millions of Americans are prescribed controlled substances every year to treat a variety of symptoms due to injury, illness, and other conditions.  Many legitimate users of these drugs often do not finish their prescriptions.  As a result, these drugs remain in the family medicine cabinet for months or years, because people forget about them or do not know how to properly dispose of them.  However, these drugs, when not properly used or administered, are just as addictive and deadly as street drugs like methamphetamine or cocaine.

Recent studies and reports show this growing trend of prescription drug abuse.  According to the most recent National Survey of Drug Use and Health, nearly 7 million people have admitted to using controlled substances without a doctor's prescription.  The most common group abusing these drugs is people between the ages of 12 and 25.  According to the Substance Abuse and Mental Health Services Administration, the number of Americans aged 12 and older currently abusing pain relievers have increased by 20 percent since 2002.

Sadly, more and more people are dying because of this abuse.  The Centers for Disease Control and Prevention report that the unintentional deaths involving prescription narcotics have increased 117 percent during the years 2001 to 2005.  With young people being the most common group of prescription drug abusers, logic dictates that the numbers of young people dying is also increasing.  These are statistics that cannot be ignored.

Iowa is not immune from this trend impacting the entire United States.  A Des Moines Register article from February, 2009, reports of the death of a 14 year old Brody Middle School Student who was found dead at his home from an apparent overdose of prescription drugs.  The same article reports that 85 percent of drug and alcohol overdoses at the children's emergency center at Mercy Medical Center in Des Moines are from prescription or over-the-counter medicines.

In fact, according to the most recent Iowa Drug Control Strategy, prescription drug abuse is the newest, fastest growing form of substance abuse in the state.  The Iowa Department of Public Safety Division of Narcotics Enforcement reports the number of pharmaceutical cases opened in 2010 in Iowa surpassed the number of cases in 2009.  Pain killers such as hydrocodone and oxycodone are the most widely abused prescription drugs in Iowa.  According to data from the Prescription Drug Monitoring Program, these two drugs comprise over a third of all prescriptions in Iowa with 85 million doses prescribed in 2009.  The State Poison Control Center states that calls concerning these drugs have skyrocketed 2,031 percent since 2002 indicating an increased amount of diversion.

According to the National Survey of Drug Use and Health, more than half of the people who abuse prescription narcotics reported that they obtained controlled substances from a friend or relative, or from the family medicine cabinet.  As a result, most community anti-drug coalitions, public health officials, and law enforcement personnel have been encouraging people within their communities to dispose of old or unused medications in an effort to combat this growing trend.

National prescription drug take-back days have been sponsored by the Drug Enforcement Administration, in coordination with local law enforcement, public health officials, and community anti-drug coalitions.  These projects have yielded positive results.  The first event, held in September 2010, resulted in 242,000 lbs. of old or unused prescriptions being turned in for proper disposal.  The second event, held in April 2011, resulted in over 375,000 lbs. being turned in for disposal.  In Iowa, residents turned in over 5,000 lbs. of medicine in the last take- back day.  This was a threefold increase from the first event.  Each time prescription drugs are discarded appropriately, it decreases the opportunity for the drug to be abused.

These prescription drug take-back events have helped remove dangerous substances from communities throughout the country; but more work needs to be done.  Public awareness needs to be increased.  The dangers of inappropriately using or sharing these drugs must be advertised.  And we must continue to educate about the proper ways to dispose of old or unused medications.

I have participated in community town hall meetings devoted to raising awareness about the dangers of prescription drug abuse.  I have also cosponsored legislation, with Senators Klobuchar and Cornyn, which enables more communities and anti-drug organizations to collect old and unused medicine for disposal.  This bill was signed into law last year and the Attorney General is in the process of developing guidelines for communities to become more active in removing these potential dangers.  Despite this progress, I along with my colleagues will continue to look for ways to effectively combat this growing danger.  This hearing is an effort to continue this process.

I am interested in learning other best practices from pharmaceutical companies, health care professionals and practitioners, and law enforcement personnel, to reduce the potential for diversion of prescription drugs to illegal and dangerous purposes.  I want to know more about how health care practitioners can become better educated and trained to ensure patients are not over-prescribed medicine.  And finally, I want to learn more about how the pharmaceutical industry can reduce the risk of opiate theft and how opiate manufacturers safeguard their supplies intended for the pharmaceutical industry  I look forward to reviewing the testimony from the witnesses and working to reduce this dangerous epidemic.



Grassley seeks description of SEC outcome on referrals

Tuesday, May 24, 2011

WASHINGTON - Sen. Chuck Grassley of Iowa today asked the Securities and Exchange Commission to describe how the agency resolved referrals involving the firm SAC Capital.  Grassley has a record of conducting oversight of federal agencies and regularly tracks whether the SEC is doing its job to protect investors.  The SEC's dealings with this firm are the latest example that could illustrate how the agency functions.

The text of Grassley's letter is available below.  The signed copy is available here. The  attachment of referrals is not included, at the request of the investigative agencies that it not be made public.

May 24, 2011

The Honorable Mary Schapiro


U.S. Securities and Exchange Commission

Washington, DC 20549

Dear Chairman Schapiro:

One of Congress' most important jobs is to perform constitutionally designated oversight over the executive branch of government. Toward that end, I have had a longstanding interest in whether the Securities and Exchange Commission (SEC) is properly policing and regulating our financial markets on behalf of pension holders with investments in securities and other investors. In order to continue this oversight, I recently wrote to the Financial Industry Regulatory Authority (FINRA) seeking referrals from FINRA from January 1, 2000, to the present regarding SAC Capital, a firm that has been the subject of significant media coverage regarding allegations of insider trading.

While I am sensitive to the SEC's concerns about confirming or denying any ongoing investigations, Congress and the SEC seek information for fundamentally different purposes. As you know, Congress conducts fact-finding inquiries in order to shed light on problems and inform potential legislative solutions. The function of congressional investigations is not to establish whether any private firms have violated the law, but rather to examine particular facts and circumstances in order to assess how well the agencies created by Congress are executing the authorities granted to them. It helps us in Congress to ask questions in the context of specific cases rather than talk about general issues with the agency. Looking into specific examples is essential for Congress to understand how effectively the SEC pursues referrals such as these.

Therefore, in preparation for a briefing, please provide a written explanation as to: (1) how the SEC resolved each of these referrals, (2) how the number of referrals over this timeframe compares to similarly situated firms, (3) whether a Wells Notice was ever drafted with regard to SAC Capital related to any of these referrals or related to any other matter (if so, please provide a copy of any Draft or Final Wells Notice). Attached is a list of the referrals provided by FINRA, for your reference.

Thank you for your cooperation and attention in this matter. I would appreciate a response by June 7, 2011.


Charles E. Grassley, Ranking Member

Committee on the Judiciary



Tax-owing stimulus contractors

Tuesday, May 24, 2011

Billions of dollars in stimulus funds went to contractors and grantees who owed the government hundreds of millions of dollars in tax debts, according to a new report from the Government Accountability Office.  Sen. Chuck Grassley, a requester of the report, made the following comment on the report, which is the subject of a hearing today of the Senate Permanent Subcommittee on Investigations.  Grassley is a senior member and former chairman and ranking member of the Finance Committee, with jurisdiction over tax policy.

"Many companies pay their taxes, so there's no reason for the government to deal with companies that don't.  The businesses that should be excluded first from government business are those that have tax debts outstanding over several years and haven't done anything to try to pay off the debt.  A substantial amount of the estimated unpaid federal taxes owed by stimulus program contractors are in this category.  A government contract is something to be earned, not something to be taken for granted.  The Administration has at least two rules in place to address this problem, but it's not clear whether the rules are being used.  This problem has come up before.  Congress needs to figure out how to fix it.  The Senate Finance Committee has considered this.  It's good that the committee with jurisdiction over government contracts is looking at it, too."

The full report is available here.

Here is a summary of the report from the Senate Permanent Subcommittee on Investigations:


Of the 63,000 contractors and grantees examined, 3,700 were found to owe $757 million in back taxes, but also received $24 billion in stimulus awards. This represents 5.9% of all awardees that GAO analyzed.

If all 80,000 awardees were examined and the same proportion held, 4,500 awardees owing $909 million would have received $29 billion in contracts. That would represent more than 10% of all stimulus money designated for contracts and grants ($275 billion).

The GAO study identified 15 cases of individual contractors or grantees involving "abusive or potentially criminal activity" and has referred those cases to the IRS for further investigation. GAO indicated that those 15 cases represent only a small number of the cases that it could have referred.

Although a federal levy program is in place to catch tax cheats that get federal payments, many awardees escaped this review because money was disbursed at the State and local level or by a prime contractor.

Approximately 35% of all unpaid taxes were for old debts incurred prior to 2003, indicating that many of the awardees were known tax cheats, and not persons with new debts.

The bulk of tax debts were from unpaid corporate and payroll taxes.

• Unpaid corporate taxes - $417 million (55%)

• Unpaid payroll taxes - $207 million (27%)

• Other unpaid taxes - $133 million (18%)

GAO uncovered several specific examples that were particularly egregious:

• One construction firm owed nearly $400,000 in back taxes, but received a contract worth more than $1 million.

• One engineering services firm had a $6 million delinquent tax debt and was called by the IRS an "extreme case of noncompliance." It got a stimulus contract worth over $100,000.

• One security firm owed $9 million and was repeatedly cited not only for being uncooperative with the IRS, but also had frequent labor violations. It received a stimulus contract worth more than $100,000.

• One non-profit organization owed more than $2 million from years of unpaid payroll taxes, while at the same time its CEO made numerous trips to a casino. This organization received more than $1 million in stimulus funds.


Q.  Can veterans access telehealth services?

A.  Telehealth uses telecommunications technologies to deliver health care services, including medical consultations, prescriptions, preventive care and curative medicine.  Using telehealth could mean a phone call with a doctor about symptoms, or a trip to a local hospital for a high-tech appointment or treatment with a specialty doctor located hundreds of miles away.  For veterans in rural areas of the country, telehealth services improve access to care.  Seeing a specialist in person, without telehealth, can require many hours of driving and overnight trips.  For some older or disabled veterans, these trips can be especially difficult and may discourage them from taking preventive measures or seeking necessary health care.  The telehealth programs of the Department of Veterans Affairs (VA) enable veterans to access health care from home or a local or conveniently located medical center.  Telehealth also reduces costs for the VA.  I recently reintroduced legislation with Senator Mark Begich of Alaska, which would help more veterans to access telehealth services.

Q.  What would your telehealth legislation do?

A. Some veterans who do not have a disability related to their military service are assessed copayments for VA medical care.  The bipartisan legislation, which I also cosponsored in 2010, would waive veterans' copayments for telehealth services.  Right now, veterans' copayments can be as high as $50 when specialized care is needed.  The goal of our legislation is to encourage more veterans to take advantage of this user-friendly, lower-cost alternative.  Accessing care through telehealth helps us to meet the promise made to America's veterans that they would receive the care they need.   Already, thousands of Iowa's veterans have enrolled in telehealth programs, and many more could take advantage of this service.  The elimination of copayments for telehealth would lessen the financial burden on those enrolled today and encourage other veterans to use this high quality and cost-effective health care delivery system.  The option of telehealth is a win-win for veterans and taxpayers.


WASHINGTON - Senate Judiciary Committee Ranking Member Chuck Grassley is reiterating the need for a timely response from Attorney General Eric Holder to his Questions for the Record for Holder during the Attorney General's May 4th appearance before the Judiciary Committee.

Grassley said he wanted to reiterate his hearing questions for the record in a letter because of the timely nature of his oversight work on Operation Fast and Furious.  He said that generally, the Department of Justice takes at least five to eight months to respond to Questions for the Record.   Questions for the Record are additional questions to witnesses that appeared before the committee that are not able to be asked during a committee hearing or follow-up questions for the witness based on information provided during the hearing.

"I'll keep pressing for answers from the Attorney General.  The oversight work we're doing on the ATF's policy to let guns walk is incredibly important, and these questions should be answered in a timely manner, not the night before the Attorney General comes before the Judiciary Committee the next time," Grassley said

In January, Grassley began questioning the ATF policy that allowed guns to walk across the Mexican border after whistleblowers from within the ATF came to him to express dismay and concern about the ill-advised policy.  These whistleblowers had warned their higher-ups that the strategy would end up getting someone killed.  Their prophecy may have come true when Border Patrol Agent Brian Terry was killed in a gunfight with suspected cartel members on December 14, 2010.  The senator has sent 13 letters to the Department of Justice, the Bureau of Alcohol, Tobacco, Firearms and Explosives, Customs and Border Patrol and the Department of State, nearly all have gone unanswered, including instances where the Justice Department provided inaccurate information.

Here is a copy of the text of Grassley's letter.  Here is a copy of the letter and the Questions for the Record.

May 16, 2011


The Honorable Eric H. Holder, Jr.
Attorney General
U.S. Department of Justice
950 Pennsylvania Avenue, N.W.
Washington, DC 20530

Dear Attorney General Holder:

Last week I submitted Questions for the Record (QFRs) following the Judiciary Committee hearing on Oversight of the Department of Justice (DOJ).

Historically, the Justice Department generally takes five to eight months to respond to QFRs.  However, because of my ongoing investigation into the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), I would appreciate receiving responses to questions on this topic much sooner.  Attached is a copy of those questions.  Please provide responses as soon as possible.

Additionally, I would like to reiterate the requests that have remained unanswered from my previous letters on this matter.

a)      In my letter of February 16, 2011, I requested that you provide:

1) All records relating to communications between the ATF and the Federal Firearms Licensee (FFL) who sold the weapons to Avila, including any Report of Investigation (ROI) or other records relating to the December 17, 2009 meeting "to discuss his role as an FFL during this investigation."

2) All records relating to communications between ATF headquarters and Phoenix Special Agent in Charge (SAC) William Newell from December 1, 2010 to the present, including a memorandum, approximately 30 pages long, from SAC Newell to ATF headquarters following the arrest of Jaime Avila and the death of CBP Agent Brian Terry.

3) A copy of the presentation, approximately 200 pages long, that the Group 7 Supervisor made to officials at ATF Headquarters in the Spring of 2010.

4) Copies of all e-mails related to Operation Fast and Furious, the Jaime Avila case, or the death of CBP Agent Brian Terry sent to or from SAC Newell, Assistant Special Agent in Charge (ASAC) George Gillette, Group 7 Supervisor, or the Case Agent between November 1, 2009 and January 31, 2011.

I requested that these documents be provided on a rolling basis as they are identified and located.  I also requested that you please prioritize your search for documents and produce them in the following order: (1) documents in response to requests one through three, (2) documents in response to request four dated between December 13, 2010 and January 31, 2011, and (3) documents in response to request four dated between November 1, 2009 and December 13, 2010.

b)      After ICE Agent Jaime Zapata was brutally murdered in Mexico on February 15, I was shocked to learn that, like Border Patrol Agent Brian Terry, Agent Zapata had been killed with a weapon traced to an individual in the U.S. that the ATF had been aware was trafficking firearms.  Accordingly, in my March 4, 2011 letter, I requested answers to the following questions:

(1) Although the gun used in the assault on Agent Zapata that has been traced back to the U.S. was purchased on October 10, 2010, how can we know that it did not make its way down to Mexico after the November investigation, when the arrest of these three criminals might have prevented the gun from being trafficked and later used to murder Agent Zapata?

(2) When did law enforcement first become aware that Morrison purchased the gun?

(3) Given that the likely recipients of any trafficked guns were so close to the border, did any ATF personnel raise concerns about the possibility of those guns being used against U.S. law enforcement? If so, how did the ATF address those concerns?

(4) Did any ATF personnel raise concerns about the wisdom of allowing individuals like the Osorio brothers or Morrison to continue their activities after the November weapons transfer? If so, how did the ATF address those concerns?

In addition to answering those questions, I also requested all records relating to:

(5) When law enforcement officials first became aware of the trafficking activities of Otilio and Ranferi Osorio and Kelvin Morrison;

(6) Surveillance that may have been conducted on the Osorio brothers or Morrison prior to the November transfer of weapons between the ATF's confidential informant and the Osorio brothers and Morrison;

(7) The November transfer; and

(8) Any surveillance that law enforcement continued to conduct on the Osorio brothers or Morrison after the November transfer.

Finally, I requested a briefing on the Zapata matter.  I reiterated these requests in my letter of March 28, 2011, and am still awaiting both a response and a briefing.

c)      In my letter of April 8, 2011, I requested written answers to three questions.  The third read:

(3) What steps have you taken or do you plan to take to ensure that employees are aware of their right to communicate directly with Congress if they so choose?

In response, you provided me with information about the ATF providing its agents with information about the Whistleblower Protection Act in order to prevent retaliation against whistleblowers.  While that is appreciated, it does not respond to my question.  I asked about making employees aware of the appropriations provision that protects their right to communicate directly with Congress.  As I outlined in that letter:

[A]ttempts to prevent direct communications with Congress are not a lawfully authorized activity of any officer or employee of the United States whose salary is paid with appropriated funds.[1] Specifically, no officer or employee may attempt to prohibit or prevent "any other officer or employee of the Federal Government from having direct oral or written communication or contact with any Member, committee, or subcommittee of the Congress" about a matter related to his employment or the agency "in any way, irrespective of whether such communication or contact is at the initiative" of the employee or Congress (emphasis added).[2]

I wrote to you on January 31 to ensure you were aware of these provisions and to express concerns that without proper guidance, managers might inappropriately intimidate employees to discourage them from speaking with Congress and thus unlawfully interfere with a Congressional inquiry.[3] In order for Congress to exercise its oversight authority and act as a check on Executive power, it is crucial that agency employees are free to communicate directly with Members and Committee staff.  Direct contact means contacts that do not necessarily involve Congressional liaison or agency management. Without such direct, unfiltered communications, Congress would still be unaware of, and unable to inquire about, the serious allegations involving the death of Border Patrol Agent Brian Terry and the sales of weapons to known and suspected gun traffickers.

Accordingly, please provide responses to the questions attached, as well as those outlined above, by May 30, 2011.  If you have any questions regarding this letter, please have your staff contact (202) 224-5225.  Thank you for your prompt attention these important issues.



Charles E. Grassley, Ranking Member


[1] Consolidated Appropriations Act, 2010, P.L. 111-117, 123 Stat. 3034, § 714 (2010), as continued by §101

of continuing resolutions P.L. 111-242, 124 Stat. 2607 (2010) and P.L. 112-6, 125 Stat. 23 (2011)–which

extends the funding levels in the 2010 appropriations bills, as well as "the authority and conditions

provided in such Acts," through April 8, 2011.

2 Id.

3 18 U.S.C. § 1505 (providing criminal penalties for obstructing or impeding the power of Congressional


International Trade Commission Report Shows China's Practices Cost U.S. Billions in Economic Activity, Millions of Jobs 

Washington, DC - May 18, 2011 - Senate Finance Committee Chairman Max Baucus (D-Mont.), Ranking Member Orrin Hatch (R-Utah) and Senior Committee Member Chuck Grassley (R-Iowa) today demanded an end to China's violations of U.S. intellectual property rights (IPR) that cost the U.S. tens of billions of dollars in economic activity and millions of jobs.  The Senators' comments follow their release of a report they requested last year from the U.S. International Trade Commission (ITC) quantifying the impact of China's unfair policies on the American economy and jobs.

"China's unfair practices cost the U.S. billions of dollars and millions of jobs," said Baucus. "Time and time again, China has failed to protect and enforce American intellectual property rights, and it continues to discriminate unfairly against American businesses.  We cannot pretend that there aren't real consequences to these violations when these numbers show that millions of American jobs are on the line."


"American job creators and workers cannot afford to lose $48 billion to Chinese intellectual property piracy.  Our nation plays by the rules - so too must China," said Hatch. "I hope the report's findings spur the Administration to deepen their efforts to meet this challenge."

"China  wants the benefits of an economic relationship with the United States but won't hold up its end of the bargain," Grassley said. "Protecting a trading partner's intellectual property is Trade 101.   When China looks the other way on intellectual property theft, or unfairly favors Chinese-owned firms, it damages its credibility as a trading partner.  The effects on U.S. businesses and workers are real.  This report quantifies how extensive the damage is on the American economy.   It shows the importance of negotiating strong intellectual property protections in trade agreements and enforcing those rights once the agreements are in place."

According to the ITC report, China's IPR infringement cost the U.S. economy approximately $48 billion in 2009 alone.  Of that total, more than $26 billion came from the information and service sector and more than $18 billion came from the high-tech and heavy manufacturing sector, in addition to billions more from other sectors.  Although IPR infringement most commonly affects large firms, small and medium-sized firms are also affected.

The ITC report stated that if China complied with their current international obligations to protect and enforce IPR, 2.1 million jobs could be created in the U.S.  The most direct jobs impact would come in high-tech, innovative industries.

China's discriminatory indigenous innovation policies, the report said, also give preferential support to Chinese companies in a manner that may lead to additional U.S. job losses.  For example, the Chinese wind power market is skewed in favor of Chinese-owned firms to an extent that has dramatically reduced the market share belonging to foreign-owned companies.  China places local-content requirements on new wind farm construction that effectively locks foreign firms out of new contracts.  The Chinese government has not awarded a wind farm contract to a foreign-owned firm since 2005.

The report the Senators released today is the second in a pair they requested from the ITC. The first report, released in December 2010, outlined the structural and institutional impediments that undermine IPR enforcement and described China's indigenous innovation policies that discriminate against American companies.

The Senate Finance Committee has exclusive jurisdiction over international trade.  The full ITC report is available here.


Grassley Comment on Wasteful Spending at Public Housing Authorities

Sen. Chuck Grassley of Iowa has been tracking wasteful spending at public housing authorities including those in Philadelphia, Los Angeles, and Puerto Rico.  He made the following comment on an audit released today, showing the Philadelphia Housing Authority wasted millions of dollars from the federal stimulus package.  The audit is available here.

"This audit is the latest example of the Philadelphia Housing Authority's, and ultimately HUD's, failure to protect residents and taxpayers.  The housing authority has been a Bermuda Triangle for tax dollars. The primary people being helped are shady developers and law firms.  It's frustrating to see such blatant abuse of tax dollars.  The stimulus act included $4 billion for public housing agencies nationwide.  The millions of stimulus dollars wasted in Philadelphia call into question whether the rest of the $4 billion was wasted just as badly.  The Philadelphia Housing Authority is the fourth-largest in the country, and it paid millions of dollars to outside law firms to obstruct inspector general audits.  If other housing agencies are as troubled, and with the Obama administration's requiring little accountability for spending, we might never know whether stimulus money for housing was spent as intended or how much went down the drain."

Grassley Presses Agency for Answers on Wireless Network Project

WASHINGTON -- Sen. Chuck Grassley of Iowa is seeking disclosure and transparency from the Federal Communications Commission about a new wireless Internet network project that appears on a fast track for approval from the agency, despite concerns about the impact on other technologies and possible financial problems behind the operation.

"This project is controversial for two reasons.  One, there are questions about whether it will block GPS technology, which is important to agriculture and other industries.  Two, the principal behind this project is said to be under investigation by another agency for his financial dealings," Grassley said.  "The FCC's unusual fast-tracking of this project before its effects have been fully tested raises questions about whether the agency did its due diligence.   I'm looking for answers to these questions so taxpayers can be assured that the government is treating public property the way it ought to be treated.   So far, the FCC hasn't provided any of the information I've requested.  It should, in the interest of transparency in doing the public's business."

Grassley recently wrote to the FCC, asking for information related to the agency's consideration of the LightSquared project, which various industries warn would produce signals that could jam existing navigation systems used in farming, air travel, law enforcement, by the military and in general consumer navigation.  The head of the hedge fund behind the project told investors that his firm is under investigation by the Securities and Exchange Commission for allegations of market manipulation, according to media reports.  The firm has been the subject of considerable media attention for losing large amounts of money and other controversies including whether the firm should have told investors in a timely fashion about a $113 million loan it extended to the principal of the firm.

Grassley has not received the information he requested from the FCC.  "This is an agency with a lot of power over public air waves," Grassley said.  "I'll continue to ask for information in the public's interest."

This week, officials in the Las Vegas area say GPS could be unavailable as LightSquared technology is tested, causing concern for military operations and other non-commercial pilots.

The FCC has granted a conditional waiver for LightSquared to proceed with its wireless network.  A coalition of groups has objected to what it considers the unprecedented speed with which the FCC is allowing the company to move forward.

The text of Grassley's letter to the FCC is available here.

Grassley Urges Action for Keystone Pipeline with Canada

Senator Says the Decision is Important for American Consumers Paying High Gas Prices

WASHINGTON - Senator Chuck Grassley is urging Secretary of State Hillary Clinton to make a prompt decision on the international Keystone XL pipeline project.

"Consumers need action on high gas prices, and we ought to move forward on this project." Grassley said about his letter to Clinton.  "Canada is a steady and reliable neighbor.  The pipeline needs to be built safely and responsibly.  And, whether or not the United States approves the project, the oil will be produced in Canada, and if it doesn't come to the United States, then China likely will get it.  So, this project is one thing the administration can be doing and should be doing to increase the supply of energy and thereby reduce prices at the pump for consumers."

The Keystone XL pipeline was approved more than a year ago by the Canadian National Energy Board.  It would provide 830,000 barrels of crude oil a day and help to counteract both insufficient domestic oil supplies in the United States and reduce dependence on less reliable foreign sources, including Venezuela, Libya or OPEC members.