MSPB: Issues of performance and misconduct may overlap #precedentialdecision

 

This is a Precedential Court Decision for readers tracking precedence and types of cases.
Tribunal: U.S. Court of Appeals for the Federal Circuit
Case Number: 2021-1686
MSPB Docket Number: DE-0752-19-0297-I-2
Issuance Date: October 29, 2021
Adverse Actions; Performance and Misconduct; Harmful Error; Penalty/Frequently Repeated Offenses

The petitioner was a Passport Specialist for the agency, who in 2016 served a 3-day suspension for making inappropriate comments at work, and in 2018 served a 5-day suspension for failure to follow instructions and failure to protect personally identifiable information. Nevertheless, the petitioner received a fully successful performance rating for calendar year 2018.

On May 9, 2019, the agency removed the petitioner based on four charges:

(1) failure to follow instructions (eleven specifications), (2) failure to protect personally identifiable information (one specification), (3) failure to follow policy (five specifications), and (4) improper personal conduct (one specification). Some of this conduct occurred during the 2018 rating period.

The petitioner filed a Board appeal, and the administrative judge issued an initial decision affirming his removal. The administrative judge credited the agency’s distinction between issues of performance and misconduct, the former involving employees who “can’t do” and the latter involving employees who “won’t do.” Finding that the charges “presented an issue of misconduct more than performance,” the administrative judge declined to consider the 2018 performance evaluation as a rebuttal to the charges. He found that the agency proved its charges and established nexus and that the removal penalty was reasonable under the circumstances. The initial decision became final, and the petitioner sought judicial review.

Holding: Issues of performance and misconduct may overlap. The existence of a fully successful performance evaluation does not necessarily bar discipline for matters covered by that evaluation, but it still must be considered in determining whether the employee committed the offenses charged and the reasonableness of the penalty imposed.

1. The court explained that performance and conduct issues “may overlap.” In this case, the petitioner’s performance plan required that he follow instructions, and some of the specifications under the failure to follow instructions charge occurred during the period covered by the 2018 performance evaluation. Therefore, the administrative judge should have considered that evaluation in assessing that charge.

2. Nevertheless, the administrative judge’s failure to consider the 2018 performance evaluation did not constitute reversable error because the petitioner failed to show that it likely affected the outcome of the Board’s decision. The petitioner did not dispute that any of the events underlying the charges occurred, and five of the eleven specifications of failure to follow instructions occurred outside the 2018 performance year.

3. Even assuming that the administrative judge erred in failing to consider the 2018 performance evaluation in assessing the penalty, the petitioner did not show harmful error. First, the deciding official considered the evaluation in reaching his penalty determination, in the context of his thorough Douglas factor analysis. Second, even if the evaluation suggested that the 2018 specifications of failure to follow instructions were not serious in and of themselves, their seriousness was magnified in light of the petitioner’s prior discipline for similar infractions and his continued failure to follow instructions after the 2018 appraisal period ended.

Read in full here.

 

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Presentation of Credentials: US Ambassador to Singapore Jonathan Kaplan

 

 

 

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US Embassy Belize: Resident Amcit Pleads Guilty in Crypto Laundering Service, Forfeits 4,400+ Bitcoins

 

This past summer, an Ohio resident who was apparently also a resident of Belize pleaded guilty to a money laundering conspiracy arising from his operation of Helix, a Darknet-based cryptocurrency laundering service. The plea deal includes the forfeiture of more than 4,400 bitcoin, valued at more than $200 million.
Via USDOJ: Ohio Resident Pleads Guilty to Operating Darknet-Based Bitcoin ‘Mixer’ That Laundered Over $300 Million

An Ohio man pleaded guilty today to a money laundering conspiracy arising from his operation of Helix, a Darknet-based cryptocurrency laundering service.

According to court documents, Larry Dean Harmon, 38, of Akron, admitted that he operated Helix from 2014 to 2017. Helix functioned as a bitcoin “mixer” or “tumbler,” allowing customers, for a fee, to send bitcoin to designated recipients in a manner that was designed to conceal the source or owner of the bitcoin. Helix was linked to and associated with “Grams,” a Darknet search engine also run by Harmon. Harmon advertised Helix to customers on the Darknet to conceal transactions from law enforcement.

“By holding Harmon accountable, the department has disrupted the unlawful money laundering practices of these dangerous criminal enterprises,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “The Justice Department, together with our law enforcement and regulatory partners, will continue to take enforcement actions to identify and impede those who use illicit means for financial gain, as well as those who use the Darknet to facilitate and obscure their criminal conduct.”

“Darknet markets and the dealers who sell opioids and other illegal drugs on them are a growing scourge,” said Acting U.S. Attorney Channing D. Phillips for the District of Columbia. “They may try to hide their identities and launder millions in sales behind technologies like Helix. But the department and its law enforcement partners will shine a light on their activities, dismantle the infrastructure such criminal marketplaces depend on, and prosecute and convict those responsible.”

“Criminals may think they can mask financial transactions by using services like Helix to conceal the source of illicit funds,” said Assistant Director Calvin A. Shivers of the FBI’s Criminal Investigative Division. “The FBI and our state, local, federal and international law enforcement partners are working together every day in a complex and ever-changing digital environment to protect the American people from sophisticated money launderers and financiers.”

“The Darknet is driven in part by the criminal marketplaces which peddle their nefarious goods and services,” said Chief James C. Lee of the IRS Criminal Investigation. “But these marketplaces thrive in large measure because of the infrastructure that supports them. Harmon profited by facilitating the back-channel support of these marketplaces and helped criminals launder money they received via illicit activities. He then hid those funds from the government. He admitted his role today in these activities and will now be held accountable.”

“Harmon admitted that he conspired with Darknet vendors to launder bitcoin generated through drug trafficking and other illegal activities,” said Assistant Director in Charge Steven M. D’Antuono of the FBI’s Washington Field Office. “Today’s guilty plea demonstrates the FBI’s commitment to infiltrate and shut down the cryptocurrency money-laundering networks that support cyber-criminal enterprises.”

Harmon admitted that Helix partnered with several Darknet markets, including AlphaBay, Evolution, Cloud 9 and others, to provide bitcoin money laundering services for market customers. In total, Helix moved over 350,000 bitcoin – valued at over $300 million at the time of the transactions – on behalf of customers, with the largest volume coming from Darknet markets. Harmon further admitted that he conspired with Darknet vendors and marketplace administrators to launder such bitcoins generated through illegal drug trafficking offenses on those Darknet marketplaces.

As part of his plea, Harmon also agreed to the forfeiture of more than 4,400 bitcoin, valued at more than $200 million at today’s prices, and other seized properties that were involved in the money laundering conspiracy. Harmon will be sentenced at a date to be determined and faces a maximum penalty of 20 years in prison, a fine of $500,000 or twice the value of the property involved in the transaction, a term of supervised release of not more than three years, and mandatory restitution. Chief Judge Beryl Howell of the U.S. District Court for the District of Columbia accepted Harmon’s guilty plea and will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The IRS-CI Cyber Crimes Unit and the FBI’s Washington Field Office investigated the case, with valuable assistance provided by the Criminal Division’s Office of International Affairs, the U.S. Attorney’s Office for the Northern District of Ohio, the IRS’s Washington, Cincinnati and Oakland Field Offices, the FBI’s Criminal Investigative Division and Cleveland, Newark and San Francisco Field Offices, and the State Department’s Diplomatic Security Service.

The Belize Ministry of the Attorney General and the Belize National Police Department provided essential support for the investigation, coordinated through U.S. Embassy Belmopan. The investigation was coordinated with the Financial Crimes Enforcement Network, which assessed a $60 million civil monetary penalty against Harmon in a parallel action.

Trial Attorneys S. Riane Harper and C. Alden Pelker of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) and Assistant U.S. Attorney Christopher B. Brown of the U.S. Attorney’s Office for the District of Columbia prosecuted the case. Additional assistance was provided by Trial Attorneys Emily Siedell and Brian Nicholson of the Criminal Division’s Office of International Affairs, former CCIPS Trial Attorney W. Joss Nichols and Assistant U.S. Attorney Daniel Riedl of the Northern District of Ohio.