If True That Foreign Diplomats in the U.S. Are “Eligible” for Medicaid — That’s Absolutely Bonkers!

— Domani Spero

In early December, Preet Bharara, the United States Attorney for the Southern District of New York, and George Venizelos, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced charges against 49 current or former Russian diplomats or spouses of diplomats employed at the Russian Mission in the United States for participating in a widespread fraud scheme from 2004 to August 2013 to illegally obtain nearly
$1.5 million dollars in Medicaid benefits. (See 49 Russian Diplomats/Spouses Charged With Picking Uncle Sam’s Pocket in Medicaid Scam).

On December 6, during the Daily Press Briefing, the State Department deputy spokesperson, Marie Harf said this:

“We routinely inform all foreign missions in the U.S. – most recently we did this in November – that we expect their personnel to maintain health insurance coverage. So under U.S. law, nonimmigrants, which diplomats fall under in this case, who meet certain eligibility criteria may apply for and receive federally funded medical care.”

Whaaat?!

Lest we get all excited, this is the same spokesperson, of course, who could not say what appropriate consular assistance is provided when an American citizen dies abroad.  Or who says from the podium that “It’s not for any State Department official to sign off on any arrests, right, even regarding a foreign diplomat.”  Whoops!  (We heard that the Special Agents of the Diplomatic Security Service toppled over in their swivel chairs when the clip aired on YouTube).

Then on December 14, UPI reported that “Russia’s Foreign Minister Sergei Lavrov said “some of the diplomats accused of glomming on to the U.S. healthcare system were actually entitled to do so.”

Entitled to do so?  As in  a legal right or a just claim to receive it?

On December 16, Interfax also reported that Moscow is “already taking disciplinary measures in relation to the Russian diplomats accused in the U.S. of unlawfully receiving Medicaid benefits to cover the pregnancy and childbirth costs.”

The report quotes Russian Foreign Minister Lavrov saying, “This is a disciplinary offence, because, by being insincere in filing applications and citing inaccurate figures to receive some benefits, they violated the host country’s norms and rules, which a diplomat has no right to do. I’d like to stress once again: they are being subjected and will be subjected to disciplinary action.”  Now, the same report repeats this notion that some of the Russian diplomats were “entitled” to apply for such assistance due to their low income:

“We have looked into this. First, the allegation that none of them was entitled to this because they are foreigners is wrong. There are different laws in various states of the U.S. that allow for using Medicaid benefits by foreigners. Second, it is not quite true that the Russian diplomats’ incomes did not make them eligible for receiving such payments through Medicaid,” he said.

“We have studied the files of the said colleagues, and it turned out that at least some of them had salaries that entitled them to apply for such assistance from the U.S. fund at that moment. 

How bonkers is that?  That American taxpayers are subsidizing the health care cost of foreign diplomats in the United States.  Which part of this makes sense? Medicaid is a federally funded program designed to assist low-income families afford health care. And in this case, if the allegations are true, Russian diplomats took public assistance that would have been  helpful to low income Americans.

The big question now is — can we also call this foreign aid?

Screen Shot 2013-12-26

Extracted from Medicaid Renewal Form
(click image for larger view)

Now Congress wants to know Whiskey Tango Foxtrot is going on here. The SFRC is missing on this but U.S. Rep. Ed Royce (R-CA), Chairman of the House Foreign Affairs Committee, recently expressed “serious concern about foreign diplomats receiving, and reportedly defrauding, U.S. Government-funded benefits programs.” In his letter to Secretary Kerry, Chairman Royce requested a meeting plus written answers to the following questions:

1.      How will the Administration treat the 11 named defendants who, according to the U.S. Attorney, remain in the United States?  Will you ask the Russian government to waive their immunity so that they can be prosecuted?  If not, will the Department declare them persona non grata?

2.      How will the Administration treat the 38 named defendants who, according to the U.S. Attorney, no longer reside in the United States?  Will you request that they be extradited to stand trial?  If not, will the Department impose a U.S. visa ban on them?

3.      How will the Administration treat the unindicted co-conspirators at Russian diplomatic offices in the U.S. who allegedly advised and assisted the named defendants by supplying false documentation to New York officials in support of the fraudulent Medicaid claims?

4.      Will the Administration bill the Russian government for the Medicaid benefits its personnel fraudulently used?  If not, how will New York State’s Medicaid program be compensated for the loss?

5.      On December 5, 2013, Department of State Deputy Spokeswoman Marie Harf said, “We are still…reviewing the charges that were unsealed.”  How closely did the U.S. Attorney, Department of Justice, or Federal Bureau of Investigation cooperate with the Department of State during the investigation?  What steps did the U.S. Attorney take to coordinate with the Department of State before filing the complaint on November 18, 2013 or unsealing it on December 5, 2013?

This situation also raises a number of important questions about government programs that provide benefits to foreign diplomats.  I therefore would appreciate written answers to the following questions not later than January 13, 2014:

6.      On December 6, 2013, Department of State Deputy Spokeswoman Marie Harf stated that foreign diplomats in the United States “who meet certain eligibility criteria may apply for and receive federally funded medical care.”  What are the medical programs for which foreign diplomats may be eligible?  What are the eligibility criteria?  Over the last 10 years, how many foreign diplomats have used these programs?  What was the total cost of the benefits provided?  Please provide these data sorted by foreign diplomatic mission or international organization.

7.      Are foreign diplomats eligible for government-funded benefits other than Medicaid (e.g., Temporary Assistance to Needy Families or the Supplemental Nutrition Assistance Program)?  If so, which programs and what are the eligibility criteria?  Over the last 10 years, how many foreign diplomats have taken advantage of these programs?  What was the total cost of the benefits provided?  Please provide these data sorted by foreign diplomatic mission or international organization.

8.      Is the Administration aware of other cases where foreign diplomats fraudulently or inappropriately obtained Medicaid or other government-funded benefits?  Please provide the details of these cases, including the cost of any benefits that were inappropriately obtained.

9.      What is the Administration doing to ensure that foreign diplomats cannot inappropriately obtain government-funded benefits in the future?  Has the Administration asked relevant government benefit agencies to check their rolls for the names of foreign diplomats?  Does the Department regularly provide a list of foreign diplomats to relevant government benefit agencies?

And — if some foreign diplomats in the United States are “eligible” for Medicaid, how about some of their underpaid domestic workers, are they eligible, too?

Oh, for god’s sakes, maybe the State Department should just publish a handbook of freebies.

 

 

 

 

 

 

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Embassy Row’s Dirty Little Secret: Abuse of Migrant Domestic Workers by Diplomats

— Domani Spero

The logic behind a restrictive interpretation of functional immunity is that while a diplomat may be protected from some distractions to aid his purpose, there ought to be no need for him to violate the laws of his host state to do so. As many legal scholars have pointed out, a diplomats behaviour in his host country is best described by the Arabic proverb, يا غريب خليك أديب (ya ghareeb, khalleek adeeb) – O stranger, be thou courteous. — Jaideep Prabhu 

Back when ….

In 2007, the Department of State reported that some foreign diplomats may be abusing the household workers they brought to the United States on A-3 or G-5 visas.  A subsequent Government Accountability Office (GAO) report the following year revealed that 42 household workers with A-3 or G-5 visas alleged that they were abused by foreign diplomats with immunity from 2000 through 2008. The GAO believes the total number of alleged incidents since 2000 is likely higher for four reasons: household workers’ fear of contacting law enforcement, nongovernmental organizations’ protection of victim confidentiality, limited information on some cases handled by the U.S. government, and federal agencies’ challenges identifying cases.

Via GAO 2008

Via GAO 2008

Each year, the State Department issues A-3 and G-5 visas to individuals whose employers are foreign diplomats on official purposes in the United States. Most of these individuals are hired to work for foreign diplomats in the District of Columbia, Maryland, New York, or Virginia. According to the 2008 GAO report, for fiscal years 2000 through 2007, 207 U.S. embassies and consular posts overseas issued 10,386 A-3 visas and 7,522 G-5 visas.

Recent State Department statistics indicate that from 2008 through 2012, it issued 5,330 A-3 visas to attendant, servant, or personal employee of A1 visa holders (ambassador, public minister, career diplomat, consul, and immediate family) and A2 visa holders (other foreign government official or employee, and immediate family).  It also issued 4,196 G-5 visas to attendant, servant, or personal employee of G1 through G4 (international organization officials and representatives).  That’s about a 50% decrease on A-3 visas and a 44% decrease in G5 visas issued since 2008. What might have accounted for that huge drop?

How about the William Wilberforce Trafficking Victims Protection Reauthorization Act of 2008?  Click here for the laws on trafficking in persons dating back to the year 2000.

In any case — five years ago today, President George W. Bush signed the TVPRA to combat human trafficking. Section 203 of the Trafficking Victims Protection Reauthorization Act of 2008 requires the secretary of state to suspend  the issuance of A–3 visas or G–5 visas to applicants seeking to work for officials of a diplomatic mission or an international organization, if the Secretary determines that there is credible evidence that 1 or more employees of such mission or international organization have abused or exploited 1 or more nonimmigrants holding an A–3 visa or a G–5 visa, and that the diplomatic mission or international organization tolerated such actions.

No secretary of state has ever exercise the authority to suspend any diplomatic mission despite some repeat offenders. For a look at what the State Department has done/not done when it comes to TVPA and domestic employees of foreign diplomats in the United States, read Janie A. Chuang’s critical paper on Achieving Accountability for Migrant Domestic Worker Abuse in the 2010 North Carolina Law Review.  One of the sections talks about the State Department’s “Failure to Use Power to Name, Shame, and Deter Wrongdoers.”

Chief of Mission Accountability

In 2008, the State Department through USUN sent this note verbale on the Treatment of Domestic Workers at UN Missions.

Recently, the host country has learned of a number of allegations of trafficking in persons with respect to domestic workers, including allegations of involuntary servitude and physical abuse. For example, this Mission has periodically been informed of instances where wages actually paid are less than those stipulated in an employment contract; where passports have been withheld from employees; where the actual number of working hours is considerably greater than those initially contemplated and no additional pay is provided; and where an employee is forbidden from leaving an employer’s premises even when off-duty. The United States Mission takes seriously any such allegation brought to its attention and refers these cases, as appropriate, to the United States Department of Justice for review and investigation.  
[…]
The United States Mission also wishes to advise the Permanent Missions that its commitment to fair and reasonable labor conditions is consistent with its commitment to human rights and, further, comports with the practice of other governments and with the requirements imposed by international organizations on their employees who have foreign domestic workers.  Although the United States recognizes that the great majority of diplomats and Mission personnel are law-abiding members of the United Nations community, it is necessary to periodically re-circulate and update information regarding United States laws, regulations and policies regarding the employment of personal domestic servants.
In fact, if you take a look at this archive of diplomatic notes, it is clear that the treatment of domestic employees, their contracts, prevailing wage, pre-notification requirements are recurring subjects.

In a 2009 diplomatic note, the State Department puts the heads of missions on notice that they are generally accountable for the treatment of domestic workers employed by their mission. We presume that this is a recurring reminder that the State Department sends to all diplomatic missions in the United States:

The United States Mission looks to the Permanent Representatives to be responsible for the conduct of the members of their missions and for ensuring that their treatment of domestic workers in their employ evidences respect for all relevant United States laws. In this regard, it is  recommended that the Permanent Mission maintain copies of the signed domestic worker contracts and be able to review such contracts, as well as records of payments made to each domestic worker, in the event that the United States Mission seeks assistance if faced with credible allegations of a mission member’s mistreatment of a domestic worker.

The United States Mission and/or the Department of State refer credible allegations of abuse of domestic workers by mission members which may constitute criminal conduct to the United States Department of Justice. In that context, the United States Mission and the Department of State may take other appropriate action, including, based on the determination by an appropriate prosecuting authority that prosecution is warranted, a request for a waiver of any applicable immunity. Mission members are not only expected to pay the greater of the minimum or prevailing wage and abide by other contract terms, but they should also be aware that in the United States, withholding a person’s passport maybe evidence of the crime of trafficking in persons if it is done with the intent of keeping that person in a state of forced labor or service.

In the Trafficking in Persons Report 2010, the State Department notes the following:
Worldwide, domestic workers employed by diplomats suffer abuses ranging from wage exploitation to trafficking offenses. Diplomats are government officials who serve their governments abroad and are generally able to apply for visas enabling domestic workers – often from third countries – to accompany them on their foreign assignments.
Because domestic servants working for diplomats work behind closed doors – cleaning, cooking, and caring for children – they can become invisible to the neighborhoods and communities they live in. Domestic workers brought into a country by diplomats face potentially greater isolation than other workers because of language and cultural barriers, ignorance of the law, and sheer distance from family and friends. They work for government officials who may appear to them to hold exceptional power and/or influence. The resulting invisibility and isolation of such workers raises concerns about the potential for diplomatic employers to ignore the terms of their employment contracts and to restrict their domestic workers’ freedom of movement and subject them to various abuses. Because diplomats generally enjoy immunity from civil and criminal jurisdiction while on assignment, legal recourse and remedies available to domestic workers in their employ – and the criminal response otherwise available to the host government – are often significantly limited.
And in March 2012, during the Annual Meeting of the President’s Interagency Task Force To Monitor and Combat Trafficking in Persons, then Secretary of State Hillary Clinton said this:

“We thought it was unfair for diplomats who victimized their own domestic workers were, because of diplomatic immunity, virtually untouchable. So now, we’re making sure that diplomats coming to this country understand their obligations and responsibilities, and we’re taking action when we have evidence that they are not.”

No one paid attention then,  but they’re paying attention now.

In the latest diplomatic row between the United States and India, the Times of India provided an unconfirmed timeline of the events.   It indicates that the State Department reportedly wrote to the Indian ambassador in Washington, D.C. on September 4, 2013 expressing “considerable concern” over the allegations.  On September 21, the Indian Embassy reportedly replied, “that this was none of US’ business and that the maid was seeking a monetary settlement and US visa, whereby subverting both Indian and US laws.”

If that timeline is accurate, one has to ask who miscalculated whose response?

 

“This is happening 10 miles from the White House”

– Martina Vandenberg, Human Trafficking Pro Bono Legal Center

Despite the many notable cases of abuse by diplomats ranging from non-payment of wages to sexual assaults, we do not see very often an arrest of a foreign diplomat or international representative in the United States. But following the arrest of  IMF’s Dominique Strauss-Kahn in 2011, Reuters did report the following:

Foreign diplomats have been the subject of at least 11 civil lawsuits and one criminal prosecution related to abuse of domestic workers in the last five years, according to a Reuters review of U.S. federal court records. The allegations range from slave-like work conditions to rape, and the vast majority of the diplomats in these cases avoided prison terms and financial penalties.

We have not been able to locate all civil lawsuits but the cases below are just a sampling of abuse allegations by domestic employees against their foreign diplomat-employers in the United States in the last several years.

Tae Sook PARK v. Bong Kil SHIN (South Korean Consulate/San Francisco) | Tae Sook Park, a domestic servant sued Deputy Consul General Bong Kil Shin of the Korean Consulate in San Francisco.  The Ninth Circuit Court of Appeals reversed a district court decision dismissing Park’s claims of labor law violations. It held that the deputy consul was not entitled to immunity under the Vienna Convention on Consular Relations or the U.S. Foreign Sovereign Immunities Act, and remanded the case back to district court. He later became ambassador.

Swarna v. Al-Awadi (Kuwait Embassy)|  Swarna Vishranthamma took to court her former employers, Badar Al-Awadi and his wife, Halal Muhammad Al-Shaitan and the State of Kuwait in 2009.  At the time of the events in question, Mr. Al-Awadi was a diplomat serving in New York City with the Permanent Mission of the State of Kuwait to the United Nations. According to WaPo,  Kuwaiti government hired a prominent law firm to defend him in the civil case — in court filings, he has denied the allegations — and then later promoted him to be Kuwait’s ambassador to Cuba.

Mildrate Yancho Nchang (Cameroon Embassy) | According to WaPo,  Nchang filed a case against her employers alleging she toiled for three years without pay or a day off and then was hospitalized after being beaten by a Cameroonian diplomat’s wife. She sued in federal court in Maryland, but the case was dismissed in 2006 when the diplomat asserted immunity.

Mazengo v. Mzengi, et.al. (Tanzania Embassy)| In 2007, Ms. Mazengo, a citizen of Tanzania, sued her former employers, defendants Alan S. Mzengi and Stella Mzengi, husband and wife, alleging that they falsely imprisoned her and subjected her to involuntary servitude and forced labor in violation of federal law. Alan S. Mzengi was a diplomat accredited to the embassy of the Republic of Tanzania.  WikiLeaks Alert: See the State-USEmbassy Tanzania demarche on the outstanding restitution for TIP victim, Ms. Zipora Mazengo.

Regina Leo (Kuwaiti Embassy) | In July, 2008, a lawsuit was filed against an attache in the Embassy of Kuwait, Brig. Gen. Ahmed Al Naser, and his family, by their former maid, Regina Leo, an Indian immigrant who alleged that she was forced to work as much as 18 hours per day.

Marichu Suarez Baoana (Philippine Embassy) | According to WaPo, in 2009, Ms. Baoana, a Philippine national sued the Permanent Representative of the Philippines to the United Nations, Lauro L. Baja Jr. alleging she was forced to endure 126-hour workweeks with no pay, performing household chores and caring for the couple’s grandchild.

Daedema Ramos (Kuwait Embassy) | In 2010, the Filipina housekeeper left a Kuwaiti diplomat’s Manhattan duplex where she worked 20 hours a day, earning as little s $500 a month. With help from Damayan, a grassroots organization fighting for the rights of low-wage Filipino migrant workers she escape her employer, and was encouraged to fight back. In July 2012, the diplomat settled with her after she demanded unpaid wages.

Sophia Kiwanuka (World Bank) | According to Reuters, World Bank economist, Anne Margreth Bakilana, hired a Tanzanian woman, Sophia Kiwanuka, to work in her home in Falls Church, Virginia, and improperly withheld Kiwanuka’s wages and threatened to send her back to Tanzania, according to court records. She pleaded guilty in 2010 and was sentenced to two years probation and fined $9,400.

Bhardwaj v. Dayal et al (Indian Embassy) |  In 2011, Indian national Santosh Bhardwaj filed a lawsuit against Indian Consul General Prabhu Dayal for allegedly intimidating her into a year of forced labor, where she was subjected to 105-hour workweeks for $300 per month. According to Indian Express, in December 2012, the Indian Ministry of Finance approved payment of $75,000 from the budget of Ministry of External Affairs to a “former domestic assistant” who had filed a lawsuit against India’s consul-general in New York, Prabhu Dayal. Click here to read an interview with Mr. Dayal in India Today concerning his case and the Khobragade case.

Araceli Montuya (Lebanon Embassy ) | She filed a lawsuit against  her former employer, the Lebanese Ambassador Antoine Chedid. On April 2011, U.S. District Judge James Boasberg in Washington threw out a case in which Montuya alleged that Chedid and his wife underpaid and verbally abused her.

Four former cooks and housekeepers (Qatar Embassy) |  According to Reuters, on March 2011, four former cooks and housekeepers for Essa Mohammed Al Manai, Qatar’s second-highest ranking diplomat in the United States filed a civil lawsuit alleging they were paid less than 70 cents per hour and “forced to work around the clock” at Al Manai’s six-bedroom home in Bethesda, Maryland. The suit also claimed that one of the women was sexually assaulted. More here.

F.V. (The Taipei Economic and Cultural Office) |  In 2011, Hsien-Hsien “Jacqueline” Liu, 64, of Taiwan, high-ranking representative of Taiwan was charged in federal court with fraud in foreign labor contracting for fraudulently obtaining a Filipino servant for her residence. Liu paid the Filipino worker $400-450 per month, although the employment contract stipulated a salary of $1,240 per month. Liu allegedly required the victim to work six days a week, 16 to 18 hours a day, and forbid her to leave the house without permission. (See Taiwanese Official in Kansas Charged for “Fraudulently Obtaining a Filipino Servant”).  Liu was arrested by the FBI on Nov. 10, 2011 and was detained for two months before entering a plea agreement. She eventually entered a plea agreement and was ordered to pay US$80,044 in restitution to the two maids. According to the Taipei Times, in 2012, Liu was suspended from her duties for two years for “seriously damaging the country’s reputation.”

Gurung v. Mahotra (Indian Embassy) | In 2012, a New York City Magistrate Judge  ordered Neena Malhotra, an Indian diplomat and her husband Jogesh to pay nearly $1.5 million reportedly arising from their employment of an Indian girl, Shanti Gurung who alleged “barbaric treatment” while she was employed as their domestic worker.

C.V. (Mauritius Embassy) | According to The Record, in 2012, Somuth Soborun, the Republic of Mauritius’ ambassador to the US pleaded guilty to the misdemeanor offense in September, admitting that he failed to properly pay a domestic worker minimum hourly and overtime wages between December 2008 and August 2009. He was fined $5,000.  As part of his plea agreement, Soborun has already paid $24,153 in restitution to the domestic worker, who was identified in court papers only by the initials C.V.

Kumari Sabbithi, Joaquina Quadros and Tina Fernandes (Kuwaiti Embassy) | In 2012, the ACLU represented three Indian women who were employed as domestic workers by Major Waleed Al Saleh and his wife Maysaa Al Omar of McLean, Virginia.  The complaint alleged that they were brought to the U.S. in the summer of 2005 and that they were forced to work every day from 6:30 a.m. until sometimes as late as 1:30 a.m. for approximately $250 to $350 a month. The complaint further alleged that they were subjected to threats and verbal and physical abuse, including one incident in which Al Saleh threw one of the women, Sabbithi, against a kitchen table, knocking her unconscious. The Kuwaiti government agreed to settle the case brought by three women who claimed that they were trafficked to the United States by a Kuwaiti diplomat and his wife.

USA v. Devyani Khobragade |  In December 2013, the Indian Deputy Consul General Arrested For Visa Fraud and False Statements Related to Domestic Worker

The  reported abuse of migrant domestic workers by diplomats and the staff of international organizations typically include wages and hour violations, passport deprivation, denial of the workers’ right to leave the house or premises in which they work, physical, sexual and emotional abuse and invasion of privacy, where domestic workers often have their rooms searched, their mail opened, and are not allowed to make private phone calls.  For additional reading, see  Joy M. Zarembka’s Global Woman: Nannies, Maids, and Sex Workers in the New Economy,which details the plight of some of the domestic workers brought to the U.S. by employees of international organizations.

Maid in Manhattan Case: U.S. Attorney Preet Bharara, the Man Who Makes Embassy Row Tremble

We suspect that nowhere is the  Khobragade Affair watched more closely than in the United Nations in New York and in the Embassy Row (the informal name for the streets and area of Washington, D.C. in which embassies, diplomatic missions, and other diplomatic representations are concentrated).  Besides India, that is.  To avoid possible “misunderstanding,” the State Department has recommended that diplomats keep employment records of their domestic workers including work hours and payment, records that should be maintained for the duration of actual employment of domestic employees plus three years.  Would be interesting to see how many diplomatic missions in the United States actually take this recommendation seriously.

In an interview with India Today published on December 23, the former Indian Consul General Prabhu Dayal who was taken to court by his former housekeeper in New York said that “in our consulates in the US, there is a lot of fear today.”

“India’s view has been that the domestic assistants of our diplomats hold Official Passports and should be outside the purview of US labour laws. The US side has not agreed to this, insisting that US laws apply to them. This impasse continues.[…] even if were were to revamp our system relating to domestic assistants, we will not be able to guarantee that our officials in our Consulates will not be arrested or dragged into law courts for some  reason or another in future. The US is a highly litigious country where suing people is a sort of favourite past time. […] There is no doubt, however that our officers posted at the Consulate in New York have begun to feel very insecure after all these recent cases, and the same may also be true for the other Consulates in Chicago, San Francisco, Houston and Atlanta. How will India protect its diplomats posted to the Consulates given the US position on immunity?”

But perhaps the more telling parts during this incident is the on the record statement made by a senior Indian official quoted by the Times of India below:
“Which Indian would pay a help Rs 6500 ($ 100) a day?” asked Shakti Sinha, a former principal secretary in the government of India who did various stints abroad, including at the World Bank and various UN agencies, assuming eight normal working hours.

FirstPost.com reports  on India’s former foreign secretary Kanwal Sibal’s opinion on this matter, quoting the former official as saying:

“There is much chicanery involved here. Indian diplomats taking domestic staff to the US accept the minimum wage requirement when all concerned, including the US visa services and the State Department, know this is done pro-forma to have the paper work in order. To imagine that the US authorities are duped into believing that our diplomats will pay their domestic staff more than what they earn is absurd. The US authorities have been clearing such visas for years to practically resolve the contradiction between reality and the letter of the law.”

And that’s probably why “there is a lot of fear today.”

Apparently, according to NYT, there are 14 other Indian maids working for Indian diplomats in the United States, and “India is negotiating over their status with the State Department.”  If a Deputy Consul General could be hauled to jail for underpaying her domestic employee, who could Preet Bharara go after next?

Dirty Laundry Gets Washed

The State Department’s TIP 2012 report says that “U.S. government employees, their dependents, and members of their households do not have immunity in the U.S. domestic legal framework for acts of human trafficking associated with domestic staff occurring at overseas postings. Any such reports will be fully investigated by Diplomatic Security and/or the Office of the Inspector General and, where appropriate, may result in either an administrative penalty and/or referral to the Department of Justice for criminal prosecution. These measures apply to Department of State employees overseas as well as their dependents and other members of household.”

It’s not an accident that the above item was included in the report.  The State Department had two recent cases of domestic worker abuse.

Harold and Kimberly Countryman | In 2006, Harold Countryman, a former Department of State agent, and his wife, Kimberly Countryman, a realtor in northern Virginia, pleaded guilty to aiding and abetting visa fraud.  According to the plea agreement, Kimberly Countryman admitted to using the fraudulent visa to further the forced labor of a Cambodian woman in their employ. According to court documents, the couple provided materially false information to the Department of State to obtain a visa on behalf of a Cambodian woman, who they then brought to the United States to work for them as a domestic servant for two years. In the plea agreement, Kimberly Countryman admitted that she procured the visa with reason to believe that the visa would be used to commit a felony, namely forced labor. As a result, Kimberly Countryman is subject to an increase in her sentence. Kimberly Countryman acknowledged that she withheld a portion of the woman’s pay, took possession of the woman’s passport, and physically assaulted the woman.  As part of the plea agreement, the Countrymans were required to pay $50,000 in restitution and $50,000 in forfeiture.

Linda  and Russell Howard |  In 2011, Jane Doe, an Ethiopian national in her 30s filed a lawsuit in the U.S. District Court for the Eastern District of Virginia against a State Department employee Linda Howard and her husband, Russell Howard, alleging involuntary servitude, forced labor and human trafficking in violation of the Trafficking Victims Protection Act of 2000 (TVPA).  She alleged that she was forced to work more than 80 hours a week for less than a dollar an hour; the exact amount was $0.88 an hour; the minimum hourly wage at the time of Jane Doe’s employment was $6.55 an hour.  Court awarded a default judgment to Jane Doe for total damages of $3,306,468.  Linda and Russell Howard had reportedly left the United States. See Court Awards $3.3 Million Default Judgment Against State Dept Couple Accused of Slavery and Rape of Housekeeper.

The Signal Plus the Noise, the Diplomatic Edition

The suspension of a high-ranking Taiwanese official for two years for “seriously damaging the country’s reputation” is the only case we are aware of in recent memory where an official was disciplined by the sending country in the aftermath of U.S. federal charges related to the treatment of a domestic worker.  In most cases, it looks like the official in question, protected by the sending state, gets moved elsewhere,  or even gets a promotion with no career repercussion. Clearly underpayment or mistreatment of a domestic employee is not considered a serious offense by a good number of diplomatic missions.

While diplomats continue to dodge cases like this behind diplomatic immunity, and as long as governments stand behind their diplomats when they commit infractions like this, the practice will continue. As the German Institute of Human Right points out: “...[E]mployers’ diplomatic immunity in prac­tice overrules the human rights of the victim and leads to a situation of de facto-unaccountability and –impu­nity for exploitative employers.”

In this India-U.S. row, we note that the outrage is focused on the circumstances of the diplomat’s arrest. And that is understandable. But it is also important to note that while the focus of the  outrage is the strip-search, few are talking about the alleged treatment of the domestic worker.  Unless, of course, we’re talking about the former Khobragade maid as a CIA agent.

In early December, Preet Bharara, the United States Attorney for the Southern District of New York also charged 49 Russian Diplomats/Spouses With Picking Uncle Sam’s Pocket in Medicaid Scam. Most of the diplomats charged are no longer in the country. And of the defendants still  here, most are attached to the UN Mission and presumably enjoy diplomatic immunity. If the U.S. may not be able to put anyone in jail nor be able to recoup the thousands of dollars in scammed Medicaid money, why charged them?  We suspect that the charges were brought to put a stop to the scam.  Basically a megaphone saying — we know what you’re doing, shame on you, now stop it.

As complicated as the Khobragade case may seem, it will be resolved eventually. A $90 billion bilateral trade partnership is at stake. Who would throw that partnership over the cliff for a mid-level official?  Or for an underpaid housemaid?  Stay tuned.  Perhaps the more interesting take on this incident is by Alison Frankel who writes, “For all we know, the State Department intended to send a message to the international diplomatic corps, which is often accused of cloaking itself in diplomatic immunity to avoid claims of mistreating domestic staff.”

Do we have an aha moment here?

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Maid in Manhattan Case: U.S. Attorney Preet Bharara, the Man Who Makes Embassy Row Tremble

— Domani Spero

On December 12, USDOJ announced the arrest of Indian diplomat, Devyani Khobragade for visa fraud related to her underpaid domestic employee.

The uproar caused by the arrest has only grown in the last several days.  In response to the arrest of its diplomat, India took several retaliatory actions against the U.S. Mission in India. Several examples below according to DNA India, some obviously petty, but others more serious:

  • Indian government officials cancelled their meetings with a visiting US Congressional delegation.
  • Called for details including salaries paid to all Indian staff employed at the US consulates, including Consulate officers & family.
  • Stopped all import clearances for US embassy including food and liquor.
  • “The government has asked for all US Consulate personnel’s ID cards and that of their families immediately. These will now be downgraded on par with with what the US provides to our Consulates in US,” sources said.
  • Asked the US to provide it with visa information and other details of all teachers at US schools and pay and bank accounts of Indians in these schools.

Then the former External Affairs Minister and BJP leader, Yashwant Sinha, called on the government to reciprocate against the alleged mistreatment of its diplomat by arresting the same sex companions of American diplomats using a Supreme Court verdict in India that restored a ban on gay sex.  “Put them behind bars, prosecute them in this country and punish them,” Mr Sinha said.  It appears he wasn’t alone.  According to NPR, a “senior Indian diplomat” told The Hindu that the government could retaliate against the gay partners of U.S. diplomats.  “We also know who all have brought in their gay partners and on what grounds they were given visas though there is a law against it in India,” the official said. “We can’t talk about it because this law is controversial and outdated but if the U.S. wants to go to this extent, then this law and several other options are there.”

On December 17, Delhi Police also removed the security barricades set up outside the American Embassy. “The ministry of external affairs requested us to remove these traffic measures around the US embassy and clear the road. The Nyaya Marg has been opened for public,” Special commissioner of Delhi Police (security) Taj Hassan told PTI.

The Indian Government must think of embassy security as a diplomatic privilege and not an obligation.  The Global Terrorism Index ranked India 4th (after Iraq, Pakistan, Afghanistan) as most affected by terrorism over a 10-year period.  So there is obviously a reason for those barricades.

Meanwhile, the diplomat at the center of the storm has written a letter to her colleagues, which was released online, and certainly adding to the furor about her alleged mistreatment:

My dear colleagues – senior and junior, 

I am so grateful for all the outpouring of unequivocal support and backing that has been available to me from the fraternity. I take comfort in the confidence that this invaluable support will also be translated into strong and swift action, to ensure the safety of me and my children, as also to preserve the dignity of our service which is unquestionably under siege.

While I was going through it, although I must admit that I broke down many times as the indignities of repeated handcuffing, stripping and cavity searches, swabbing, hold up with common criminals and drug addicts were all being imposed upon me despite my incessant assertions of immunity, I got the strength to regain composure and remain dignified thinking that I must represent all of my colleagues and my country with confidence and pride.

I feel I can continue to do so thanks to this strong and prolific support. I cannot say more now but will later, I did feel the deep need to thank you all so much. 

On December 18, the Embassy of India in Washington, D.C. released a statement that provides additional details of this case including accusations that the maid, Sangeeta Richard, Ms. Khobragade’s “domestic assistant” blackmailed her former employer and also have “taken cash, mobile phone and documents.”

On the same day, Secretary Kerry reportedly called Indian National Security Advisor Menon to discuss the December 12th arrest of Deputy Consul General Khobragade.  According to the State Department, in his conversation with National Security Advisor Menon, Secretary Kerry  “expressed his regret, as well as his concern that we not allow this unfortunate public issue to hurt our close and vital relationship with India.”

Also on December 18, Manhattan U.S. Attorney Preet Bharara  released a statement on the United States v. Devyani Khobragade case, clearing up misconceptions about the circumstances surrounding her arrest. No, she was not arrested in front of her children, and she was not handcuffed or restrained. And yes, she was “fully searched by a female Deputy Marshal — in a private setting — when she was brought into the U.S. Marshals’ custody, but this is standard practice for every defendant, rich or poor, American or not.” Zing!

Below is the full statement:

There has been much misinformation and factual inaccuracy in the reporting on the charges against Devyani Khobragade. It is important to correct these inaccuracies because they are misleading people and creating an inflammatory atmosphere on an unfounded basis. Although I am quite limited in my role as a prosecutor in what I can say, which in many ways constrains my ability here to explain the case to the extent I would like, I can nevertheless make sure the public record is clearer than it has been thus far.

First, Ms. Khobragade was charged based on conduct, as is alleged in the Complaint, that shows she clearly tried to evade U.S. law designed to protect from exploitation the domestic employees of diplomats and consular officers. Not only did she try to evade the law, but as further alleged, she caused the victim and her spouse to attest to false documents and be a part of her scheme to lie to U.S. government officials. So it is alleged not merely that she sought to evade the law, but that she affirmatively created false documents and went ahead with lying to the U.S. government about what she was doing. One wonders whether any government would not take action regarding false documents being submitted to it in order to bring immigrants into the country. One wonders even more pointedly whether any government would not take action regarding that alleged conduct where the purpose of the scheme was to unfairly treat a domestic worker in ways that violate the law. And one wonders why there is so much outrage about the alleged treatment of the Indian national accused of perpetrating these acts, but precious little outrage about the alleged treatment of the Indian victim and her spouse?

Second, as the alleged conduct of Ms. Khobragade makes clear, there can be no plausible claim that this case was somehow unexpected or an injustice. Indeed, the law is clearly set forth on the State Department website. Further, there have been other public cases in the United States involving other countries, and some involving India, where the mistreatment of domestic workers by diplomats or consular officers was charged criminally, and there have been civil suits as well. In fact, the Indian government itself has been aware of this legal issue, and that its diplomats and consular officers were at risk of violating the law. The question then may be asked: Is it for U.S. prosecutors to look the other way, ignore the law and the civil rights of victims (again, here an Indian national), or is it the responsibility of the diplomats and consular officers and their government to make sure the law is observed?

Third, Ms. Khobragade, the Deputy General Consul for Political, Economic, Commercial and Women’s Affairs, is alleged to have treated this victim illegally in numerous ways by paying her far below minimum wage, despite her child care responsibilities and many household duties, such that it was not a legal wage. The victim is also alleged to have worked far more than the 40 hours per week she was contracted to work, and which exceeded the maximum hour limit set forth in the visa application. Ms. Khobragade, as the Complaint charges, created a second contract that was not to be revealed to the U.S. government, that changed the amount to be paid to far below minimum wage, deleted the required language protecting the victim from other forms of exploitation and abuse, and also deleted language that stated that Ms. Khobragade agreed to “abide by all Federal, state, and local laws in the U.S.” As the Complaint states, these are only “in part” the facts, and there are other facts regarding the treatment of the victim – that were not consistent with the law or the representations made by Ms. Khobragade — that caused this Office and the State Department, to take legal action.

Fourth, as to Ms. Khobragade’s arrest by State Department agents, this is a prosecutor’s office in charge of prosecution, not the arrest or custody, of the defendant, and therefore those questions may be better referred to other agencies. I will address these issues based on the facts as I understand them. Ms. Khobragade was accorded courtesies well beyond what other defendants, most of whom are American citizens, are accorded. She was not, as has been incorrectly reported, arrested in front of her children. The agents arrested her in the most discreet way possible, and unlike most defendants, she was not then handcuffed or restrained. In fact, the arresting officers did not even seize her phone as they normally would have. Instead, they offered her the opportunity to make numerous calls to arrange personal matters and contact whomever she needed, including allowing her to arrange for child care. This lasted approximately two hours. Because it was cold outside, the agents let her make those calls from their car and even brought her coffee and offered to get her food. It is true that she was fully searched by a female Deputy Marshal — in a private setting — when she was brought into the U.S. Marshals’ custody, but this is standard practice for every defendant, rich or poor, American or not, in order to make sure that no prisoner keeps anything on his person that could harm anyone, including himself. This is in the interests of everyone’s safety.

Fifth, as has been reported, the victim’s family has been brought to the United States. As also has been reported, legal process was started in India against the victim, attempting to silence her, and attempts were made to compel her to return to India. Further, the Victim’s family reportedly was confronted in numerous ways regarding this case. Speculation about why the family was brought here has been rampant and incorrect. Some focus should perhaps be put on why it was necessary to evacuate the family and what actions were taken in India vis-à-vis them. This Office and the Justice Department are compelled to make sure that victims, witnesses and their families are safe and secure while cases are pending.

Finally, this Office’s sole motivation in this case, as in all cases, is to uphold the rule of law, protect victims, and hold accountable anyone who breaks the law – no matter what their societal status and no matter how powerful, rich or connected they are.

The comments directed at Mr. Bharara on Indian media have turned nasty, a sampling here and here, but much worse on social media.

In early December 49 Russian Diplomats/Spouses Charged With Picking Uncle Sam’s Pocket in Medicaid Scam. That was Mr. Bharara’s office.  He, by, the way, has a 77-0 record in insider trading cases in his office’s campaign to root out illegal conduct on Wall Street. According to NYT, the government’s marquee conviction came in 2011, when a jury found the billionaire hedge fund manager Raj Rajaratnam guilty of insider trading.  And don’t forget Rajat Gupta, ex-director of Goldman Sachs and ex-head of consulting at McKinsey & Co., who was sentenced to two years in prison.

In 2011, Mr. Bharara, the man who makes Wall Street tremble, was India Abroad Person of the Year 2011, an event attended by who’s who of the Diaspora and India.

It looks like in 2013, Mr. Bharara is the man who makes Embassy Row tremble.

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Indian Deputy Consul General Arrested For Visa Fraud and False Statements Related to Domestic Worker

— Domani Spero

The United States Attorney for the Southern District of New York, announced the arrest of Devyani Khobragade on charges that “Khobragade allegedly caused a materially false and fraudulent document to be presented, and materially false and fraudulent statements to be made, to the United States Department of State in support of a visa application for an Indian national employed as a babysitter and housekeeper at Khobragade’s home in New York, New York.” Ms. Khobragade  39, is currently employed as the Deputy Consul General for Political, Economic, Commercial and Women’s Affairs at the Consulate General of India in New York, New York. According to the announcement, she was charged with one count of visa fraud and one count of making false statements, which carry maximum sentences of ten years and five years in prison, respectively.

One thing notable about this announcement:  “Manhattan U.S. Attorney Bharara thanked the Department of Justice’s Human Trafficking Prosecution Unit for playing an integral role in this investigation, and for providing ongoing support in this prosecution.”

The announcement made no mention of what role, if any, the State Department’s Diplomatic Security or Consular Affairs bureau played in this case. However, the statement in the complaint is made by the lead investigator of this case, DSS Agent Mark J. Smith of the Bureau of Diplomatic Security.

Below is part of the December 12 announcement via USDOJ | Manhattan U.S. Attorney Announces Arrest Of Indian Consular Officer For Visa Fraud And False Statements In Connection With Household Employee’s Visa Application

Manhattan U.S. Attorney Preet Bharara said: “Foreign nationals brought to the United States to serve as domestic workers are entitled to the same protections against exploitation as those afforded to United States citizens. The false statements and fraud alleged to have occurred here were designed to circumvent those protections so that a visa would issue for a domestic worker who was promised far less than a fair wage. This type of fraud on the United States and exploitation of an individual will not be tolerated.”

According to the allegations in the criminal complaint unsealed today in Manhattan federal court:

Diplomats and consular officers may obtain A-3 visas for their personal employees, domestic workers, and servants if they meet the requirements set out in 9 Foreign Affairs Manual (“FAM”) 41.22. As part of the application process, an interview at the embassy or consulate is required. Proof is required that the applicant will receive a fair wage, sufficient to support himself financially, comparable to that being offered in the area of employment in the U.S. To apply for an A-3 visa, the visa applicant must submit an employment contract signed by both the employer and the employee which must include, among other things, a description of duties, hours of work, the hourly wage – which must be the greater of the minimum wage under U.S. federal and state law, or the prevailing wage – for all working hours, overtime work, and payment.

DEVYANI KHOBRAGADE prepared and electronically submitted an application for an A-3 visa (the “Visa Application”) through the website for the U.S. Department of State’s Consular Electronic Application Center for an Indian national (“Witness-1”), who was to be the personal employee of KHOBRAGADE beginning in November 2012 at an address in New York, New York. The Visa Application stated that Witness-1 was to be paid $4,500 per month in U.S. dollars. KHOBRAGADE and Witness-1 also signed an employment contract (the “First Employment Contract”) for Witness-1 to bring to Witness-1’s interview at the U.S. Embassy in India in connection with the Visa Application, which Witness-1 did at KHOBRAGADE’s direction. The First Employment Contract stated, among other things, that KHOBRAGADE would pay Witness-1 the prevailing or minimum wage, whichever is greater, resulting in an hourly salary of $9.75.

KHOBRAGADE knew that the First Employment Contract that KHOBRAGADE caused Witness-1 to submit to the U.S. State Department in connection with Witness-1’s Visa Application contained materially false and fraudulent statements about, among other things, Witness-1’s hourly wage and hours worked. Prior to the signing of the First Employment Contract, KHOBRAGADE and Witness-1 had agreed that KHOBRAGADE would pay 30,000 rupees per month, which at the time was equivalent to $573.07 U.S. At 40 hours per week, with approximately 4.3 weeks in a month, $573.07 equates to a rate of $3.31 per hour. However, KHOBRAGADE instructed Witness-1 to say that she would be paid $9.75 per hour, and not to say anything about being paid 30,000 rupees per month. KHOBRAGADE also instructed Witness-1 to say that Witness-1 would work 40 hours per week, and that Witness-1’s duty hours would be 7 a.m. to 12:30 p.m., and 6:30 p.m. to 8:30 p.m. She told Witness-1 that the First Employment Contract was a formality to get the visa.

After the First Employment Contract was submitted to the United States Department of State, KHOBRAGADE told Witness-1 that Witness-1 needed to sign another employment contract (the “Second Employment Contract”). KHOBRAGADE and Witness-1 signed the Second Employment Contract, which provided that Witness-1’s maximum salary per month including overtime allowance will not exceed 30,000 rupees per month. The Second Employment Contract does not contain any provision about the normal number of working hours per week or month.

Witness-1 worked for KHOBRAGADE as a household employee in New York, New York, from approximately November 2012 through approximately June 2013. Notwithstanding the terms of the First Employment Contract, Witness-1 worked far more than 40 hours per week, and Witness-1 was paid less than $9.75 per hour by KHOBRAGADE. In fact, notwithstanding the terms of the oral agreement between KHOBRAGADE and Witness-1 and the terms of the Second Employment Contract, Witness-1 was paid less than 30,000 rupees per month, or $3.31 per hour.

*                      *                      *

KHOBRAGADE, 39, was charged with one count of visa fraud and one count of making false statements, which carry maximum sentences of ten years and five years in prison, respectively. She is expected to appear this afternoon before U.S. Magistrate Judge Debra Freeman.

Manhattan U.S. Attorney Bharara thanked the Department of Justice’s Human Trafficking Prosecution Unit for playing an integral role in this investigation, and for providing ongoing support in this prosecution.

The Office’s Organized Crime Unit is handling the case. Assistant U.S. Attorneys Amanda Kramer and Kristy Greenberg are in charge of the prosecution.

The charges contained in the complaint are merely an accusation, and the defendant is presumed innocent unless and until proven guilty.

The Embassy of India in Washington, D.C., also released the following statement:

We were informed that Deputy Consul General of India in New York, Dr. Devyani Khobragade, was taken into custody by law enforcement authorities in New York in the morning of December 12, 2013 while she was dropping her daughter at school. Dr. Khobragade was later released that same evening.
Action was apparently taken against Dr Khobragade on the basis of allegations raised by the officer’s former India-based domestic assistant, Ms Sangeeta Richard, who has been absconding since June this year. In this context the Delhi High Court had issued an-interim injunction in September to restrain Ms Richard from instituting any actions or proceedings against Dr Khobragade outside India on the terms or conditions of her employment.
 
The US Government had subsequently been requested to locate Ms Richard and facilitate the service of an arrest warrant, issued by the Metropolitan Magistrate of the South District Court in New Delhi under Sections 387, 420 and 120B of the Indian Penal Code.
The Embassy of India in Washington DC had immediately conveyed its strong concern to the U.S. Government over the action taken against Dr Khobragade. The US side have been urged to resolve the matter with due sensitivity, taking into account the existing Court case in India that has already been brought to their attention by the Government of India, and the Diplomatic status of the officer concerned.

NDTV is reporting that India has summoned US Ambassador Nancy Powell to “lodge a strong protest against what it has called the “unacceptable treatment” of its high-ranking diplomat Devyani Khobragade, who was arrested and handcuffed in public in New York on Thursday for an alleged visa fraud.”

The Times of India reports the reaction from India’s ministry of external affairs in New Delhi with a spokesperson saying, “We are shocked and appalled at the manner in which she has been humiliated by the US authorities. We have taken it up forcefully with the US government through our embassy in Washington. We are also reiterating, in no uncertain terms, to US embassy here that this kind of treatment to one of our diplomats is absolutely unacceptable.”

This is not the first allegation involving a foreign household worker in the United States and a foreign diplomat assigned here. In the Washington Diplomat February 2010 issue, it was alleged that “the State Department has been uninterested in dealing with these cases.”

This is also not the first allegation involving the Indian Mission in the United States. In June 2011, the Consul General (CG) of India in New York, Prabhu Dayal was “slapped with forced labour charges after his 45-year-old domestic help Santosh Bhardwaj accused him of treating her like a “slave.” ( see Back in the Spotlight: Alleged Abuse of Household Workers by Foreign Diplomats with Immunity). According to thehindu.com, in 2012 a New York City Magistrate Judge also ordered Neena Malhotra, an Indian diplomat and her husband Jogesh to pay nearly $1.5 million reportedly arising from their employment of an Indian girl, Shanti Gurung who alleged “barbaric treatment” while she was employed as their domestic worker (see Gurung v. Mahotra).

For additional reading on this subject, see  GAO: July 2008 | U.S. Government’s Efforts to Address Alleged Abuse of Household Workers by Foreign Diplomats with Immunity Could Be Strengthened and GIHR: June 2011 | Domestic Workers in Diplomats’ Households Rights Violations and Access to Justice in the Context of Diplomatic Immunity.   

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49 Russian Diplomats/Spouses Charged With Picking Uncle Sam’s Pocket in Medicaid Scam

— Domani Spero

Well, this isn’t good.  The defendants are current or former Russian diplomats or spouses of diplomats connected with the Russian Mission in the United States.  The alleged widespread Medicaid fraud occurred from 2004 to August 2013. Apparently, approximately $1,500,000 in fraudulently received benefits were obtained by the defendants and dozens of other co-conspirators not named in the complaint in the last 9 years.

Via USDOJ:

Preet Bharara, the United States Attorney for the Southern District of New York, and George Venizelos, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), today announced charges against 49 defendants for participating in a widespread fraud scheme from 2004 to August 2013 to illegally obtain nearly half a million dollars in Medicaid benefits. Each of the defendants charged in the Complaint unsealed today is a current or former Russian diplomat or the spouse of a diplomat employed at either the Russian Mission to the United Nations (the “Mission”), the Russian Federation Consulate General in New York (the “Consulate”), or the Trade Representation of the Russian Federation in the USA, New York Office (the “Trade Representation”). The Complaint alleges that each of the defendants and their unnamed co-conspirators participated in a widespread scheme to illegally obtain Medicaid benefits for prenatal care and related costs by, among other things, falsely underreporting their income or falsely claiming that their child was a citizen of the United States.

Manhattan U.S. Attorney Preet Bharara said: “Diplomacy should be about extending hands, not picking pockets in the host country. Here, as alleged, a multitude of Russian diplomats and their spouses ran a scam on a health care system designed to help Americans in need. As the Complaint alleges, the scam exploited a weakness in the Medicaid system, and the charges expose shameful and systemic corruption among Russian diplomats in New York.”

According to the announcement, each of the defendants was charged with one count of conspiracy to commit health care fraud and one count of conspiracy to steal government funds and make false statements relating to health care matters, which carry maximum sentences of ten years and five years in prison, respectively.

Apparently, of the 49 defendants, 38 no longer reside in the United States.  There are, however, still 11 currently in the country. According to USDOJ, five of those individuals are diplomats working at the Russian Mission to the United Nations in New York. Another five of those individuals are the spouses of the diplomats. One defendant is currently employed at the Russian Federation’s embassy in Washington, D.C., but at the time of the charged offenses, was employed at the Consulate.

According to the allegations in the Complaint unsealed on December 5 in the Manhattan federal court:

Medicaid is a largely federally funded program in the United States designed to assist low-income families afford health care. In New York State, the Department of Health administers the Medicaid program, and the New York City Human Resources Administration oversees the program and processes applications in New York City. In New York State, pregnant women can receive immediate prenatal care following a preliminary assessment of the pregnant woman’s, and, if applicable, her spouse’s, income. If the pregnant woman provides an income level that is higher than the Medicaid eligibility threshold, the provider will generally not process the Medicaid application. Proof of United States citizenship is not required for a pregnant woman to receive Medicaid benefits because the unborn child is presumed to acquire United States citizenship by virtue of being born in the United States. Once completed, the pregnant woman is entitled to Medicaid benefits pursuant to the original application until the 60th post-partum day, and the newborn child is entitled to benefits on the mother’s initial application until the child’s first birthday. Diplomats, their spouses and children are generally not entitled to Medicaid benefits except in cases of emergency.

While in the United States, the individuals employed by the Mission, Consulate, and Trade Representation are paid a salary by the Russian government, which is not subject to United States federal, state, or local taxes. Employees of the Mission and Consulate generally live in housing, the vast majority of which is paid for by the Russian government. The Mission and Consulate historically have also paid for the medical expenses of their employees, including hospital and doctor bills, as well as dental expenses. Each of the defendants named in the Complaint is a Russian diplomat who works or worked at the Mission, Consulate, or Trade Representation, or was married to such an individual. As a result of an international convention among multiple nations and a bilateral agreement between the United States and Russia, children born in the United States to Russian diplomats generally do not acquire United States citizenship.

The investigation revealed the widespread submission of falsified applications for Medicaid benefits associated with medical costs for prenatal care, birth, and young children by the defendants, which enabled the defendants to obtain Medicaid benefits that they were not otherwise entitled to receive. Approximately $1,500,000 in fraudulently received benefits were obtained by the defendants and dozens of other co-conspirators not named in the Complaint. In general, the defendants underreported their income to an amount below or at the applicable Medicaid eligibility level in order to qualify for Medicaid benefits. In support of the underreported income, the defendants generally submitted letters signed by employees of the Mission, Consulate, or Trade Representation, purporting to corroborate that the falsely underreported income was the true income amount. The defendants’ true income was often hundreds, if not thousands, of dollars more per month than what was falsely reported to Medicaid. Moreover, before, during, and after the time that the defendants received Medicaid benefits, several of the defendants opened credit card accounts in which they reflected salaries thousands of dollars higher than they reported to Medicaid.

[…]

Three other defendants falsely claimed that their children – Russian nationals residing in the United States pursuant to visas issued by the Department of State reflecting their Russian citizenship – were citizens of the United States in order to obtain Medicaid benefits for their children. To support these lies, a United States social security card was provided for one application, and both a United States Social Security Card and a birth certificate issued by the New York City Department of Mental Health and Hygiene was provided in support of another application.

[…]

Moreover, before, during, and after the time that the defendants applied for and received hundreds of thousands of dollars in Medicaid benefits, they spent tens of thousands of dollars on luxury items, including cruise vacations and purchases such as watches, shoes, and jewelry, at stores such as Tiffany & Co., Jimmy Choo, Prada, Bloomingdale’s, and Burberry.

If you want to read the official complaint, click here: Kuleshov, Mikhail et al. 13 MAG 2711 Complaint

Meanwhile, at the State Department, the Spokesperson said on 12/5: “We are still at the State Department reviewing the charges that were unsealed. We’re not yet in a position to speak to the types of specifics about what might happen. Obviously, there is a legal procedure that will be unfolding from this point.” Below is an additional back and forth during the Daily Press Briefing:

QUESTION: Well, does it concern you at all that employees of the Russian Government, while in this country, were involved in – allegedly involved in such a scam? Will you ask the Russian Government to repay what was – what they allegedly stole, for lack of a better word?

MS. HARF: Well, we’re still looking into the charges and the type of specifics in terms of reimbursement and all of that. We’re still – we don’t have any position on that yet. We’re still looking at the charges. And as we go forward, we may have more to share.
[..]

QUESTION: I would suggest to you that 49 is more than a handful, and this appears to have been going on over a sustained period of time. And it’s unlikely that the Russian Government was unaware that these people were –

MS. HARF: I don’t know if they were —

QUESTION: You’ve read the charges?

MS. HARF: I don’t know if they were —

QUESTION: I mean, they were buying incredibly expensive jewelry, taking these fabulous vacations. You would think —

MS. HARF: I honestly don’t know if they were aware. We don’t think this should affect our bilateral relationship with Russia. Quite frankly, there are too many important issues we have to work on together. The justice system will proceed in the way that it does here in the States, and we don’t think it should impact our relationship.

Quite frankly, this was an FBI undercover operation  that went on for about a year and a half.  So a little appreciation for the work done by law enforcement agents would not be too undiplomatic, is it?  The FBI agent’s statement also notes that of the 63 births to the Russian diplomats and their spouses in New York City between the years 2004 and 2013, 58 of those families, or 92% were allegedly paid for by Medicaid benefits. False letters from senior Russian officials were allegedly routinely annexed to the Medicaid applications. The Russian official signatories include a Deputy Trade Representative, a consul, an attache’ and a counselor, according to the complaint.

Now, can you imagine Elizabeth Jennings doing something like this?

WaPo is reporting that the Russian Deputy Foreign Minister Sergei Ryabkov called the charges “no more than a cheap spin effort, no more than a desire to fulfill the order of Russophobic forces in the United States.” Also just so everyone knows, Ryabkov added that “We have many complaints about U.S. diplomats in Moscow, but we aren’t taking them into the public domain.”

This is now a diplomatic embarrassment. Friends at US Mission Russia, watch yourselves.

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