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Medtronic pays 5 surgeons $7m kickbacks in just 9 months: The rape of Medicare

August 21, 2011

The Medtronic story is not just about ghost- writing and paying for favourable peer-reviewed scientific papers and supporting researchers to the tune of millions but it is also about all the surgeons in their pocket and how they exploit and “rape” Medicare.

Earl Stevens writes:

Norton Hospital in Louisville, Ky., may not be a household name nationally. But five senior spine surgeons have helped put it on the map in at least one category: From 2004 to 2008, Norton performed the third-most spinal fusions on Medicare patients in the country.

The five surgeons are also among the largest recipients nationwide of payments from medical-device giant Medtronic Inc. In the first nine months of this year alone, the surgeons — Steven Glassman, Mitchell Campbell, John Johnson, John Dimar and Rolando Puno — received more than $7 million from the Fridley, Minn., company. Medtronic and the surgeons say the payments are mostly royalties they earned for helping the company design one of its best-selling spine products.

Corporate whistleblowers and congressional critics contend such arrangements—which are common in orthopedic surgery—amount to kickbacks to stoke sales of medical devices. They argue that the overuse of surgical hardware ranging from heart stents to artificial hips is a big factor behind the soaring costs of Medicare, the government medical-insurance system for the elderly and disabled. ….

Using a Medicare database that tracks hospitals’ billing, The Wall Street Journal was able to ascertain that Norton is among the most aggressive practitioners of spinal fusion in the country.

Spinal fusion has become one of medicine’s most controversial procedures. It involves fusing together two or more vertebrae to alleviate back pain, usually with the help of metal plates, rods and screws implanted in the patient’s back. Tens of thousands of dollars of hardware can go into a single surgery. ….. Conservative spine surgeons argue that a spinal fusion is appropriate only for a small number of conditions, such as spinal instability, spinal fracture or a severe curvature of the spine known as scoliosis, and that financial incentives have caused the procedure to become overused. …

One health insurer, the nonprofit Blue Cross and Blue Shield of North Carolina, announced in September that it would stop paying for spine fusions performed on such patients beginning on Jan. 1. The insurer said that the procedures are “considered not medically necessary.” …

Some recent studies have suggested poor outcomes for spinal fusion.

So much for the Hippocratc Oath which requires “prescribing regimens for the good of my patients according to my ability and my judgment and never doing harm to anyone“.

Related: Medtronics and others – “supporting doctors with multi – million dollar payments”  

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Posted in Business, Ethics, Medicine, scientific misconduct | Comments Off on Medtronic pays 5 surgeons $7m kickbacks in just 9 months: The rape of Medicare

Saab being plundered by Victor Muller and his friends

August 18, 2011

Travelling for a few days and have to be brief.

I am pretty sure that Saab has already been plundered by Victor Muller and his friends and has been left with with very little in the way of assets or cash. It looks like the board members of Saab’s owners increased their directors fees by obscene amounts while Saab has been struggling for cash.

Dagens Industri 

Svenska Dagbladet  

Related:

Victor Muller’s games continue: Are the new Saab shares ending up in Russian hands?


 

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Posted in Automobiles, Business, Ethics, Sweden | 1 Comment »

Victor Muller’s games continue: Are the new Saab shares ending up in Russian hands?

August 16, 2011

Victor Muller is at his games again even as Saab’s cash crunch continues. He has delayed payments to employees, suppliers, creditors and even the tax-man. The China card seems to be played out. Suppliers who start proceedings for bankruptcy get priority in getting paid. Workers get priority in getting their wages before white-collar employees. The trade unions are desperate and go along with anything as they hope for some miraculous solution. Russian “black” money – which needs to be laundered somewhere – is waiting to swoop through the back-door even if it has been barred entrance through the front-door. My own opinion is that even the initial liquidity crisis was engineered by Victor Muller by shifting cash out of Saab.

He is now engaged in the final desperate end-game at Saab (but of course without risking any of his own personal wealth). The question is whether it is his own end-game or one where he is just a proxy for his Russian masters.

Svenska Dagbladet reports:

Saab is issuing freshly printed shares at a loss to the U.S. investment fund GEM (Global Yield Fund Limited), which then sell them on at a profit. An arrangement made for the short term to pay salaries and debts. Saab is now selling four million new shares for just under 40 million Swedish kronor. GEM also purchased shares in a new issue on 3rd August – when 5 million new shares were sold in a desperate move to pay the salaries of Saab employees.

Not only are GEM well paid (because they are taking a big risk), they are also diluting the ownership of Saab’s other shareholders. In fact, these 10 million shares conveyed in a short time to GEM represents almost a third of the total shares. GEM acts only as intermediary and who is actually buying is a mystery.

GEM Yield Funds Ltd. buys shares for 90 percent of their value and then sells them on. These shares are then traded in Amsterdam. Using GEM is considered a very expensive way for Saab to raise cash but there are few options left. Issuing just another 10 million new shares could dilute the ownership sufficiently for a single owner of just the new shares to have a majority stake. And that for less than a total of 80 million kronor (about $13 million). Whether production will ever restart is looking increasingly unlikely – at least for Saab in its present form. What would happen to Saab if it ever came fully under the control of Vladimir Antonov is anybody’s guess. I suspect that Saab’s fate would then be connected more to being a money-laundering centre than to the production of quality cars. I would not be in the least surprised to find that the newly issued shares are ending up in Russian hands. The mark-up that GEM charges is probably worthwhile and represents an acceptable discount for the laundering of “funny” money.

Related: Let Saab die with some dignity

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Posted in Automobiles, Behaviour, Business, Sweden | 3 Comments »

One EU Carbon trading scam comes to trial: €5 billion just in lost taxes

August 16, 2011

The amounts of money sloshing around in the EU in carbon trading scams is mind-boggling and puts even drug money into the shade. The EU emissions trading scheme has been one of the major drivers of corruption in the last few years. The latest scam to come to trial is in Germany where just the tax evasion amounts to €5 billion ($7 billion). The total value of the carbon trades involved in this particular fraud probably exceed €50 billion. The frauds revealed so far are just a tiny fraction of all the succesful frauds that have been perpetrated – and all with the undoubted help (and connivance) of EU politicians.

It would not be surprising if the total cost of the EU emissions trading schemes (assuming  a conservative 80:20 principle) exceeded €250 billion. Eventually, the cost of all these carbon trades will have to be borne by EU taxpayers and electricity consumers.

Reuters reports:

A 5 billion euro tax fraud returned to haunt European Union’s emissions trading scheme on Monday as six individuals faced tax evasion charges at a trial which starts in Frankfurt. The case will haul the market’s multiple scandals back into the spotlight but is unlikely to implicate investment banks following a similar case against small firms in Britain.

In an activity which peaked in May 2009, traders bought carbon emissions permits in one country and sold them in another, charging for and then keeping the value-added tax (VAT) which they should have handed to tax authorities.

  • The total value of the fraud was at least 5 billion euros ($7.1 bln) in lost tax receipts, according to Europol
  • Charges have been brought against individuals at small firms. Europol said the fraud was linked to criminal networks operating outside the EU including the Middle East
  • The biggest swoop, initiated by Germany in early 2010, saw more than 2,500 officers involved across European and other countries
  • In Germany, prosecutors said in March that in addition to the six individuals charged, a further 170 suspects including seven Deutsche Bank employees were still under investigation and could be charged later
  • In Britain, the first trial of seven suspects risked delay as the investigation unearthed new evidence
  • It was easier to open an account on the carbon market registry than to open a bank account, allowing less reputable characters to participate.
  • As a new market, tax authorities in EU member states were slower to spot the fraud opportunity
  • The fraud was carried out on an unregulated spot market. Participants in such markets do not have to register with financial authorities, unlike in futures markets
  • As well as making it easier for fraudsters to gain entry, unregulated markets do not force strict know-your-client (KYC) rules on law-abiding participants meaning criminals escaped detection more easily
  • Officials at Paris-based Bluenext have not denied that their spot exchange was used by tax evaders but have maintained that they acted to stop the practice
  • French tax authorities are demanding 355 million euros ($505 million) from Bluenext, owned by NYSE Euronext, in unpaid VAT related to trades that occurred on the exchange
  • The EU’s head of tax, Algirdas Semeta, and of climate change, Connie Hedegaard, in June sent letters to EU states urging them to apply reverse tax charges which would remove the opportunity to buy EUAs VAT-free and then pocket the tax
  • The carbon market has suffered scandals besides VAT fraud, including a phishing attack, the circulation of used emissions permits and cyber theft of EUAs
  • The market has seen near-record low prices in recent weeks as the threat of a new downturn widens a glut in permits

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Posted in Alarmism, Business, Climate, Corruption, Energy, Ethics, European Union | Comments Off on One EU Carbon trading scam comes to trial: €5 billion just in lost taxes

Indian exports up 82% as focus shifts to new markets in Africa and S. America

August 12, 2011

Financial turbulence in India’s traditional markets in Europe and the US have threatened to limit  development. Even though domestic consumption has increased significantly in the last decade the Indian economy is still very dependent upon exports. There has been a shift of emphasis in the last few years as India has tried to emulate China and develop new markets in Africa and South America.

Although exports had contracted for 13 straight months beginning November 2008, India rebounded from the crisis quickly, logging an unprecedented 37.6% growth in 2010-11 on the back of incentives and a push into new markets in Latin America and Africa.

July exports surged nearly 82% from a year ago to $29.3 billion while imports grew 51.5% to $40.4 billion, trade data released on Thursday showed. 

Exports of engineering goods, which now account for as much as 30% of the export basket, to Latin America increased four-fold during April to July. The IT industry too intensified exports to the region while the pharmaceutical industry found huge demand for its generics in Brazil and Mexico.

This strategy targeting Latin America and Africa has its limits since in absolute terms the US and EU still account for a third of the country’s exports and a large portion of India’s imports. Any decline in exports to these regions will create a balance of payments problem. In April-July 2011, imports grew 40% to $151 billion, expanding the trade deficit to $42.7 billion. In July alone, the trade deficit was $11 billion.

Fortunately the 2011 monsoon looks like being  close to an “average monsoon” which should keep domestic demand buoyant. But the best long-term demand hedge for India will be in differentiating from Chinese products and increasing exports to China. Imports from China are growing fast and to get trade with China into a more healthy balance will also reduce the balance of payment risks.

From the Hindu Business Line (which is by far the most balanced and reliable financial newspaper in India):

NEW DELHI, AUG 11: 

Exports in July grew by an astonishing 81.8 per cent to $29.3 billion, according to provisional data released by the Commerce Secretary, Dr Rahul Khullar, on Thursday.

The drivers of this growth – the fastest since April 1995, according to Bloomberg – were sectors such as engineering, petroleum products, readymade garments, gems and jewellery. The strategy to diversify to new markets in Asia, Africa and Latin America has helped in maintaining high growth rates.

Dr Khullar, however, told reporters that the growth rates will definitely slowdown from August due to a demand contraction in traditional markets such as the US and Europe. He said the increase in interest cost is hurting small and medium exporters, adding that, “I am trying to get something done on that front”. …..

Since consumers in the US and Europe — owing to lower income and fear of job losses — are likely to switch over to cheaper products, exporters adapting quickly to cater such a demand will survive, Dr Khullar said. He added that the country is “better prepared” to face any slowdown than it was in 2008 during the global financial crisis.

Dr Khullar said that monthly exports are likely to fall to less than $25 billion, which would make it tough to achieve a figure of $300 billion for the entire fiscal. In 2010-11, India’s merchandise exports were valued at a record $246 billion. …… 

Meanwhile, imports in July rose 51.5 per cent to $40.4 billion. Trade deficit (gap between imports and exports) in July widened to $11.1 billion, up from $7.7 billion in June and $8.9 billion in April 2011. It had touched a $15 billion–high in May.

Dr Khullar said the high level of trade deficit continues to be a worry, adding that it could be over $130 billion for this fiscal. Trade deficit during April-July 2011 is already $42.7 billion.

Exports during April-July 2011 jumped 54 per cent to $108.3 billion, while imports during this period increased 40 per cent to $151 billion.

Engineering exports were $8.7 billion in July alone and $31.6 billion during April-July 2011 due to a huge increase in such shipments to Africa and Latin America. Thanks to high oil prices, shipments of petroleum products also rose. They were worth $4.6 billion in July and $18.6 billion in April-July, an increase of 60 per cent.

Mr Khullar said exports of most sectors have shown huge growth due to the ‘lag effect’ as these were the orders that Indian exporters received months before the recent crisis in US and Europe, tsunami in Japan, huge inflation in China and a robust growth in Latin America.

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Posted in Business, Economy, India, International Trade | Comments Off on Indian exports up 82% as focus shifts to new markets in Africa and S. America

Hold on to bricks and mortar while stock markets crash as the bears go on a rampage

August 5, 2011

In spite of the US extending its debt ceiling over last weekend with great unnecessary drama, the stock markets this week have all given in to the bears. Massive losses of stock prices have been sustained from Tokyo to Bombay to London to Wall Street.

That the bears have managed to bring so many markets down strikes me as being mainly opportunistic. Of course the underlying weakness of the markets lies in the economic profligacy primarily of the US and also in Europe in Greece, Italy and Spain. But the weakness of the Euro allows the German manufacturing sector to flourish. And the “workers of the world” in China and India and Brazil and Germany have not been strong enough to resist and counteract the alarmist views now pervading the stock markets. A double dip recession now seems inevitable.

A curious combination of the irresponsibility of having bloated public sectors (albeit in over-zealous attempts at “do-gooding”) together with the ravenous greed of the financial speculators who feed upon others but create no real wealth themselves.

I do not know how long it will last or how deep this second dip will go, but bricks and mortar and the “making of real things” that people want will eventually prevail. So I shall get rid of my shares in any companies that do not make “real things” and create real wealth.

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Posted in Behaviour, Business, Economics, Economy | Comments Off on Hold on to bricks and mortar while stock markets crash as the bears go on a rampage

Penn Psychiatrist Accuses Five Colleagues of Plagiarism

August 2, 2011

Update! 3rd March 2012

University of Pennsylvania whitewashes its own psychiatrists

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Researchers names were apparently appended to a draft prepared by a “communications company” working for and biased in favour of a particular drug company!!!

Ghost-writing for German PhD theses is not uncommon and the suspicion has always been around that medical papers about clinical trials of drugs are not entirely free from the influence of the drug companies involved. But ghost-writing of scientific papers by public relations agents of the drug companies and passing them off as unbiased, objective studies is more than just “scientific misconduct”, it approaches fraud. It reduces scientists to the role of used-car salesmen. In fact the ethics of the used-car salesmen are to be preferred. The Universities who employ such “scientists” are not averse to subordinating their ethics for the sake of funding from the drug companies.

Such scientific misconduct is revealed only when an “insider” feels aggrieved enough to break ranks. The point of aggravation usually involves some dissatisfaction with the financial benefits which often flow from the drug companies – directly or indirectly – to the compliant “researchers”. And when Universities  investigate such wrong-doing themselves they usually whitewash themselves. In this case the “whistle-blower” seems to have been aggrieved at having been “left-out”.

One of those accused – Charles Nemeroff – has already been in hot water for not declaring more than $1.2 million of income from drug companies.

From Science Magazine:

Penn Psychiatrist Accuses Five Colleagues of Plagiarism

A University of Pennsylvania researcher has accused five colleagues of scientific misconduct for allegedly allowing a drug company to put their names on a paper that they did not write. But although federal officials have said “ghostwriting” may be a form of plagiarism, which is prohibited, it’s not clear that the Office of Research Integrity (ORI) would act on this particular case.

The spat involves a June 2001 paper in The American Journal of Psychiatry on a small clinical trial of the antidepressant Paxil that was funded by GlaxoSmithKline (GSK) and the National Institute of Mental Health. In a 8 July letter sent by his attorney to ORI, Penn psychiatrist Jay Amsterdam, a co-investigator on the study but not a co-author of the paper, accuses five colleagues of “allowing their names to be appended to a manuscript that was drafted by” Scientific Therapeutics Information (STI), a medical communications company, that had been “hired by” GSK (then SmithKline Beecham). The complaint also says that the widely cited paper “was biased” in favor of the drug’s efficacy and safety and that Amsterdam felt that Penn colleague Laszlo Gyulai “misappropriated” his data.

ORI should investigate, the complaint says, because National Institutes of Health Director Francis Collins recently wrote that articles ghostwritten by NIH researchers “may be appropriate for consideration as a case of plagiarism.” (ORI only investigates misconduct that took place within 6 years of an accusation, but it makes an exception if the accused scientists are still citing the paper; Gyulai cited it in 2007.)

The accused include Gyulai; Dwight Evans, chair of the Penn psychiatry department; and three researchers at other institutions. They include Charles Nemeroff, who in 2008 was found by Emory University to have failed to report drug company income; he is now chair of psychiatry at the University of Miami.

The complaint has been posted online by the Project on Government Oversight (POGO), a Washington, D.C., watchdog group. Its staff includes Paul Thacker, a former staffer for Senator Charles Grassley (R-IA) who led an investigation alleging that Nemeroff and other psychiatrists hid millions of dollars in drug income from their institutions. POGO wrote President Barack Obama Monday to complain that because Penn concluded that a separate ghostwriting accusation made by POGO against Evans last fall was unfounded, Penn President Amy Gutmann should step down as chair of the Presidential Commission for the Study of Bioethical Issues. “We do not understand how Dr. Gutmann can be a credible Chair of the Commission when she seems to ignore bioethical problems on her own campus,” the letter says.

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Posted in Business, Ethics, Medicine, scientific misconduct | 1 Comment »

Piracy increasing off the West African coast

July 24, 2011

AFP reports that another Italian tanker has been seized by pirates off the coast of Benin.  It remains inexplicable to me in this world of satellite navigation and GPS and Rapid Reaction Forces and instant news that piracy can still not only continue but actually flourish.  

Why do I wonder if the insurance industries actually come out of this with increased profits??

AFP: Cotonou -Pirates seized an Italian tanker with a crew of 23 off Benin in the Gulf of Guinea Sunday, the Benin navy said. Navy commander Maxime Ahoyo told AFP that after receiving distress signals from the vessel, the navy sent two patrol boats in pursuit of the pirates. “We are closely monitoring the situation,” he added.

Three pirates managed to board the ship 23 nautical miles south of Cotonou (AFP/Graphic)

Earlier, the Italian news agency ANSA first reported the capture of the Rbd Anema e Core and its crew comprising 20 Filipino seamen, two Italians and a Romanian captain. It said three pirates managed to board the ship, which was carrying fuel, 23 nautical miles south of Cotonou, the economic capital of Benin. Italy’s foreign ministry said its crisis unit was in touch with the Naples-based shipowner and following the situation closely.

Italy stepped up its measures against piracy earlier in July, clearing commercial ships sailing through dangerous waters to use private security guards or soldiers for protection. It is not clear whether the Rbd Anema e Core was carrying armed guards. Pirates have seized several Italian boats over the last few years. Earlier this month, a Greek oil tanker hijacked by gunmen off the coast of Nigeria was released along with its 20-strong crew. The Liberian-flagged oil tanker Aegean Star owned by Endeavour Marine Agency was returning to the Ghanaian port of Tema. On April 21 Somali pirates captured an Italian cargo ship headed for Iran with 21 crew members on board, including six Italians, in the Arabian Sea near Oman. In February, pirates wielding rocket-launchers seized a large Italian oil tanker with a crew of five Italians and 17 Indians east off the Yemeni island of Socotra in the Indian Ocean.

http://www.google.com/hostednews/afp/article/ALeqM5gjbdbT3V3-uiqVN7BTm-kVjWF1qA?docId=CNG.ea533d48f15f37d2fc7eb24ddb07ad35.981

 

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Posted in Africa, Business, International Trade, Italy, Piracy | Comments Off on Piracy increasing off the West African coast

Is 3% the going rate for defence contract bribes?

July 14, 2011

The latest case of bribery and corruption in defence contracts where the numbers have been revealed suggests that the going rate for commissions is around 3% of the contract value for simple component contracts.

In this case as reported by Bloomberg:

Armor Holdings Inc., the military- truck maker now a subsidiary of BAE Systems Plc, agreed to pay $16 million to resolve U.S. claims it bribed a United Nations official to win contracts connected to peacekeeping missions.

The company will pay $10.3 million to resolve criminal allegations and $5.7 million to settle related civil claims, the Justice Department and Securities and Exchange Commission said in separate statements today. The violations of the Foreign Corrupt Practices Act, which began as early as 2001, took place before BAE bought the company in 2007, prosecutors said. …..

The criminal probe by the Justice Department was settled with a non-prosecution agreement that cited the company’s cooperation and internal investigation in the case. In settling the SEC claims, Armor didn’t admit or deny the allegations.

The Justice Department said Richard Bistrong, who worked in Armor’s international sales unit, and another unidentified executive arranged for the UN agent to receive more than $200,000 in commissions for the 2001 and 2003 contracts. Bistrong pleaded guilty last year to bribing UN and Dutch officials to win body armor and pepper-spray contracts.

It seems this particular contract for the UN was for $6 million, with a declared profit of about $1 million and with the value of the bribe (commission) at about $200,000. Of course the commissions would have been put down as a cost so the real margin would have been well over 20%. A $16 million penalty might appear to be reasonably and sufficiently painful, but I am quite sure that it is small relative to the profits on all the other contracts which could not be penetrated. The amount is probably considered good value by Armor and their new owners considering the immunity they have gained from further sanctions which would also presumably prevent all other prior contracts from being scrutinised very closely .

British Aerospace Systems, the new owners of Armor, are well versed in the payment of commissions for the winning of contracts. They could probably teach their new subsidiary a thing or two about how to hide commission / bribe payments as legitimate expenses.

Related:

BAE Settles Corruption Charges

Armor Holdings Resolves Enforcement Action / BAE Avoids Successor Liability

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Posted in Business, Corruption | Comments Off on Is 3% the going rate for defence contract bribes?

Tepco shares rise sharply on reports of planned break-up and nationalisation

July 4, 2011

Tepco shares rose almost 20% today as reports on Sunday described government plans to break-up the Japanese utility and to nationalise its nuclear plant assets.

Market Watch:

 

Senior members of Japan’s government have been involved in secret plans to break up the operator of the beleaguered Fukushima Daiichi nuclear power plant, according to reports. 

The plan would see the nuclear operations of Tokyo Electric Power Co. JP:9501 +19.82%  come under government control, said Reuters, citing a report Sunday in a local paper.

The plan has been devised by Deputy Chief Cabinet Secretary Yoshito Sengoku, said Reuters, citing the Mainichi daily. The newspaper said its information was from unnamed sources.

As well as nationalizing the nuclear business, the plan would see Tepco sell its power distribution business, said Reuters. Power-generation operations that use thermal and hydraulic power plants would remain as the company’s business. 

The plan would shred Tepco’s size, according to the reports, leaving it with 1.6 trillion yen ($19.8 billion) in power industry assets compared to its current 7 trillion yen.

The reports state that Sengoku has met several times with Tepco Chairman Tsunehisa Katsumata, and has informed Katsumata about the plans.

Also Sunday, The Wall Street Journal said the company has restarted the use of contaminated water to cool the reactor cores at Fukushima, one week after an initial attempt was suspended because of leaks. Tepco is hoping to achieve a cold shutdown, lowering the fuel rods’ temperature to below 100 degrees Celsius, by January.

Related:

https://ktwop.wordpress.com/2011/03/29/tepco-leadership-in-disarray-as-share-price-drops-to-47-year-low-and-government-considers-nationalisation/

https://ktwop.wordpress.com/2011/03/30/tepco-stocks-are-on-their-way-to-losing-all-value/

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Posted in Business, Energy, Japan, Natural Disasters | Comments Off on Tepco shares rise sharply on reports of planned break-up and nationalisation

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