China’s Xi urges caution over U.S. missile deployment

South Korean Prime Minister Hwang Kyo-ahn meets with Chinese President Xi Jinping in Beijing's Great Hall of the People

BEIJING (Reuters) – Chinese President Xi Jinping on Wednesday urged South Korea to pay attention to China’s concerns about the deployment of the U.S. THAAD missile defense system to the country and “cautiously” address the plan.

The United States and South Korea have begun talks on possible deployment of the Terminal High Altitude Area Defense (THAAD) system after North Korea tested its fourth nuclear bomb on Jan. 6 and conducted missile tests.

China and Russia have urged the United States to back off, saying THAAD’s deployment could also affect their security.

South Korea should “attach importance to China’s legitimate concern on security and cautiously and appropriately address the United States’ plan” to deploy THAAD in South Korea, Xi told visiting South Korean Prime Minister Hwang Kyo-ahn, the official Xinhua news agency reported.

North Korea’s drive to develop a nuclear weapons capability has angered China, Pyongyang’s sole major diplomatic and economic supporter. But Beijing fears THAAD and its radar have a range that would extend into China.

Xi added that China and South Korea should continue to work for the denuclearization of the Korean peninsula, work together to maintain peace and stability and solve problems through dialogue and consultation.

(Reporting by Ben Blanchard; Editing by Nick Macfie)

Cracks show inside Islamic State’s shrinking caliphate

An Islamic State flag hangs amid electric wires over a street in Ain al-Hilweh Palestinian refugee camp,

By Maher Chmaytelli and Isabel Coles

ERBIL, Iraq (Reuters) – It was barely more than a squiggle, but the mark of a single letter sprayed overnight on a wall in the heart of Islamic State’s self-proclaimed caliphate was a daring act of dissent.

The next day, ultra-hardline Islamic State fighters came and scrubbed out the “M” — the first letter of the word for “resistance” in Arabic — which appeared in an alley near the Grand Mosque in the Iraqi city of Mosul about three weeks ago.

A video of the single letter, scrawled about a meter long on the wall, was shared with Reuters by an activist from a group called “Resistance”, whose members risk certain execution to conduct small acts of defiance in areas under Islamic State rule.

Nearly two years since Islamic State leader Abu Bakr al-Baghdadi delivered a sermon from that same mosque summoning Muslims worldwide to the “caliphate”, it is fraying at the edges.

As an array of forces make inroads into their territory spanning Iraq and Syria, the jihadis are becoming even harsher to maintain control of a population that is increasingly hostile to them, according to Iraqi officials and people who managed to escape.

“They are harsh, but they are not strong,” said Major General Najm al-Jubbouri, who is in command of the operation to recapture Mosul and the surrounding areas. “Their hosts reject them.”

Many local Sunnis initially welcomed the Sunni Muslim militants as saviors from a Shi’ite-led government they perceived as oppressive, while thousands of foreigners answered Baghdadi’s call to come and wage holy war.

For a time, the militants claimed one victory after another, thanks as much to the weakness and division of the forces arrayed against them as their own strength. They funded themselves through sales of oil from fields they overran, and plundered weapons and ammunition from those they vanquished.

But two years since the declaration of the caliphate, the tide has begun to turn in favor of its many enemies: Iraqi and Syrian government troops, Kurdish forces in both countries, rival Syrian Sunni rebels, Iranian-backed Shi’ite militias, and a U.S.-led coalition which has bombed the militants while conducting special operations to take out their commanders.

Of the 43 founders of Islamic State, also known as ISIS, ISIL or Daesh, 39 have been killed, said Hisham al-Hashimi, a Baghdad-based expert who advises the Iraqi government.

The self-proclaimed caliph, Baghdadi, is moving in a semi-desert plain that covers several thousand square kilometers west of the Tigris river and south of Mosul, avoiding Syria after two of his close aides were killed there this year: “war minister” Abu Omar al-Shishani and top civilian administrator and second-in-command Abd al-Rahman al-Qaduli, Hashimi said.

The most senior commanders after Baghdadi are now Abu Mohammed al-Adnani, the group’s spokesman who took over military supervision after Shishani’s death, and Abu Muhammad al-Shimali, who oversees foreign fighters and succeeded Qaduli as civilian administrator, he said.

Kurdish and Iraqi military commanders say the group is deploying fighters who are less experienced and less ideologically committed to defend what remains of its quasi-state, which is under attack on multiple fronts.

Iraqi forces recently entered the Islamic State bastion of Falluja just west of Baghdad, and are pushing north towards Mosul, by far the biggest city Islamic State controls with a pre-war population of 2 million.

In neighboring Syria, U.S.-backed forces are closing in on the militant stronghold of Manbij, and President Bashar al-Assad’s Russian-backed army has advanced into the province surrounding the de facto Islamic State capital Raqqa.

On a front south of Mosul, a group of women displaced by the offensive said Islamic State fighters’ grip had begun to loosen as Iraqi forces advanced, to the point that they no longer punished people for not wearing the full face veil.

The number of foreign fighters has fallen significantly, and renewed efforts by the group to recruit locals have proven largely unsuccessful, except amongst the young and destitute, according to people who recently fled, including three repentant Islamic State members.

“When you are a young man and you don’t own 250 dinars and someone comes and offers you 20,000, 15,000 or 30,000, you will do anything,” said a former Islamic State militant from Iraq’s northern Hawija district who recently gave himself up to Kurdish forces.

Members of Islamic State’s vice squad, the Hisba, are increasingly being sent to the frontlines as designated fighters are killed off, according to people who escaped as well as Iraqi and Kurdish military and intelligence officials.

That means there are fewer militants to enforce the group’s draconian rules and dress code. But a 28 year-old teacher who recently fled Mosul said people were so afraid of the militants they did not disobey them even when they were not around.

“If they say black is white, you agree,” said the teacher, who asked not to be identified because he still has family inside the city and feared they could be targeted.

School courses were redesigned by the militants to reflect their war-like ideology. He gave an example of a math problem given to his pupils: “The Mudjahid is carrying seven magazines for his rifle, each with 30 bullets; how many rounds can he fire at the unbelievers?”

He said Arabic lessons were also redesigned, with pupils asked to fill in blanks in slogan-like sentences such as “The Islamic State is xxxx and xxxx”. The answer is “staying and expanding”.

ASSET AND LIABILITY

The Sunni population in which the militants have embedded themselves is becoming more of a liability to them but also remains one of their greatest assets.

As living conditions deteriorate and the militants crack down, the local population is increasingly hostile to the group, which has repeatedly used civilians as human shields to slow the advance of Iraqi forces in frontline cities like Falluja.

Those caught trying to escape Islamic State territory are liable to be executed on the spot — even women and children.

Despite outnumbering the militants, the population remains weaker than them. Residents were disarmed and the security forces purged in the early days after the fighters captured Mosul. But residents are increasingly cooperating with the security forces outside the city by informing on the militants.

Nineveh provincial council member Abdul Rahman al-Wakaa said the group had begun moving local leaders around so people could not identify them as easily and pass their location on to coalition and Iraqi forces.

The jihadis have also cracked down on communications with the outside world, executing people for using mobile phones and confiscating satellite dishes to prevent people from seeing the progress made by Iraqi forces.

Iraqi military leaders are hoping there will be an uprising against the insurgents as the army draws nearer to Mosul. A top Iraqi general told Reuters troops were in contact with people inside Mosul to synchronize such action with an external military assault.

The plan is to engage the militants on several fronts around Mosul simultaneously, to draw them out of the city, giving the local population a chance to revolt.

Acute hardship and hunger since Baghdad cut salaries to state workers living in areas under Islamic State control around a year ago has forced more locals to work for the group.

Islamic State, for its part, plays on the population’s fears of retribution from Iraqi forces and pro-government Shi’ite militias. Despite a string of defeats, military officials say there have been few defections from the group.

Three young men who joined Islamic State and recently surrendered to Kurdish forces in northern Iraq said the militants hunted down those who tried to abandon them.

Ahmed Ibrahim Abdullah said he had been arrested and tortured by the militants when he left. He sold a cow to pay for his bail so he could escape.

Twenty-six year old Ahmed Khalaf said he had surrendered to the Kurds in the hope he would be treated with more leniency than if captured by government forces, but that others were too afraid to the same: “There are people who have a certain idea that their fate is tied to the fate of Daesh.”

(Editing by Peter Graff)

UK ‘Leave’ vote deflates hopes for U.S.-EU trade deal

Protesters for Britain leaving EU

By David Lawder

WASHINGTON (Reuters) – Britain’s looming exit from the European Union is another huge setback for negotiations on a massive U.S.-EU free trade deal that were already stalled by deeply entrenched differences and growing anti-trade sentiment on both sides of the Atlantic.

The historic divorce launched by Thursday’s vote will almost certainly further delay substantial progress in the Transatlantic Trade and Investment Partnership (TTIP) talks as the remaining 27 EU states sort out their own new relationship with Britain, trade experts said on Friday.

With French and German officials increasingly voicing skepticism about TTIP’s chances for success, the United Kingdom’s departure from the deal could sink hopes of a deal before President Barack Obama leaves office in January.

“This is yet another reason why TTIP will likely be postponed,” said Heather Conley, European program director at the Center for Strategic and International Studies, a think tank in Washington.

“But to be honest, TTIP isn’t going anywhere, I believe, before 2018 at the earliest,” she said.

U.S. Trade Representative Michael Froman said in a statement on Friday that he was evaluating the UK decision’s impact on TTIP, but would continue to engage with both European and UK counterparts.

“The importance of trade and investment is indisputable in our relationships with both the European Union and the United Kingdom,” Froman said. “The economic and strategic rationale for T-TIP remains strong.”

TTIP negotiators are still expected to meet in Brussels in mid-July as scheduled, but those talks were aimed at focusing on less controversial issues while leaving the thorniest disagreements for U.S. and EU political leaders to resolve. And it is unclear when Britain will launch formal separation proceedings, which will take at least two years.

But analysts said both sides have been reluctant to put their best offers on the table with a new U.S. president due to take office in January and French and German leadership elections nearing in 2017.

The Brexit also will preoccupy EU officials in coming months as they launch their own negotiations with London over the future terms of UK-EU trade, and sort out their post-Brexit priorities, said Hosuk Lee-Makiyama, director of the European Centre for International Political Economy, a Brussels-based think tank.

Britain’s departure could leave U.S. negotiators facing a European side that is more dug-in on some issues, said Chad Bown, a senior fellow at the Peterson Institute for International Economics, a think tank in Washington.

“As the UK is part of the coalition of liberal trading economies in the EU, the U.S. is losing one of the more like-minded countries from the group in Brussels sitting on the other side of the negotiating table,” said Bown, a former World Bank economist.

However, Lee-Makiyama, who also sees little chance of a deal before 2018, said Britain’s departure could eliminate one source of disagreement because the UK has insisted on a financial services chapter in the trade deal.

“The only real proponent of banking regulation in TTIP is the UK. Germany and France are probably willing to let it go,” he said. “It still leaves about 20 outstanding issues at nearly the same level of difficulty.”

The TTIP negotiations, which started three years ago, have unable to settle major differences over agriculture, where the EU side has shown little willingness to alter food safety rules that prohibit American beef raised with hormones or genetically modified foods, or open its closely guarded geographical food naming rules, such as for Asiago and feta cheeses.

European negotiators have complained that the United States has offered too little to open up its vast federal, state and local government procurement markets to European vendors with “Buy American” preferences in place.

Europe also wants access to key U.S. sectors such as maritime transport and aviation, while American negotiators have been frustrated over lack of access to some 200 European sectors ranging from healthcare to education.

The two sides also are far apart on how to resolve disputes. The U.S. side favors a traditional binding arbitration approach, while the Europeans want a court-like system that allows for appeals.

More progress has been made on harmonizing regulations for things like car seat belt anchors, clothes labeling and pharmaceutical inspections.

(Additional reporting by Phil Blenkinsop in Brussels; Editing by Jonathan Oatis)

Obama says UK relationship endures despite Brexit

President Obama delivers statement about Britain leaving EU

WASHINGTON (Reuters) – President Barack Obama said on Friday that strong U.S. ties to Britain and the European Union would endure after British voters chose to leave the EU in a referendum that sent U.S. officials scrambling to contain political and economic fallout.

“The people of the United Kingdom have spoken, and we respect their decision,” said Obama, who had argued passionately for close NATO ally Britain to stay in the group.

“The United Kingdom and the European Union will remain indispensable partners of the United States even as they begin negotiating their ongoing relationship,” Obama said in a statement.

Britain’s decision at a referendum on Thursday forced the resignation of Prime Minister David Cameron and dealt the biggest blow to the European project of greater unity since World War Two.

The vote threatened to damage the U.S. economic recovery, hurt Obama’s trade agenda and made it more difficult for America’s Western allies to face challenges such as Islamic State, the rise of China and climate change together in the Democratic president’s last months in the White House.

Obama administration officials are also casting a wary eye across the Atlantic at the success of Britain’s “Leave” campaign, which has similarities with Republican Donald Trump’s insurgent bid for the Nov. 8 presidential election.

Obama, during a visit to London in April, had warned against Brexit, or Britain’s exit from the EU, in an unusually strong intervention into British politics.

“I must say we had looked for a different outcome. We would have preferred a different outcome,” U.S. Vice President Joe Biden, traveling in Ireland, said on Friday.

Biden, in remarks prepared for a speech at Dublin Castle, took a swipe at Trump who won the Republican nomination by highlighting some of the issues, particularly immigration, that appear to have won support for Britain’s “Leave” campaign.

Without mentioning Trump by name, Biden warned against “politicians and demagogues peddling xenophobia, nationalism, and isolationism.”

TRUMP ON BREXIT

Trump thrust himself into the heart of the Brexit issue, calling the result of the vote a “great thing” and drawing parallels to his own unorthodox presidential campaign.

“People want to take their country back. They want to have independence in a sense. You see it with Europe, all over Europe,” Trump, 70, said in Turnberry, Scotland where he reopened a golf course.

Obama hopes his former secretary of state Hillary Clinton will win the November election and safeguard his legacy but economic volatility in the United States after Brexit could hurt her chances of beating Trump.

In response to Britain’s decision to leave, Clinton said the United States must first safeguard against any economic fallout at home at “this time of uncertainty” and underscore its commitment to both Britain and Europe.

With the Brexit result rattling Wall Street and other markets around the world, the U.S. Federal Reserve sought to calm global financial markets by saying it was ready to provide dollar liquidity following the British vote.

After Brexit, the U.S. central bank’s ambitions for two interest rate rises this year now look unlikely. Traders of U.S.-interest rate futures even began to price in a small chance of a Fed rate cut, and now see little chance of any hike until the end of next year.

“One can forget about rate hikes in the near term,” said Thomas Costerg, New York-based economist at Standard Chartered Bank. “What I’m worried about is that the Brexit vote could be the straw that breaks the back of the U.S. growth picture.”

The historic divorce launched by the Brexit vote could sink hopes of a massive U.S.-EU free trade deal before Obama leaves office in January.

Negotiations on the Transatlantic Trade and Investment Partnership, or TTIP, were already stalled by deeply entrenched differences and growing anti-trade sentiment on both continents.

(Additional reporting by Doina Chiacu and Ayesha Rascoe in Washington, Steve Holland in Scotland and Ann Saphir in San Francisco; Writing by Susan Heavey and Alistair Bell; Editing by Chizu Nomiyama)

Latest gun control bid falters in Congress, Democrat sit-in ends

Democrats walk out of Capitol Hill after failing the gun control law

By Richard Cowan and Susan Cornwell

WASHINGTON (Reuters) – Another attempt at gun control faltered in the U.S. Congress on Thursday despite outrage at the Orlando massacre, as a proposed ban on firearms sales to people being monitored for links to terrorism barely avoided being killed in the Senate.

In a procedural vote, the Senate narrowly rejected an attempt to scrap the plan by Republican Senator Susan Collins to prevent guns getting into the hands of people on two U.S. government terrorism watch lists.

But the proposal looked short of the support it would need to advance through the chamber, and Republican leaders said the Senate would switch from debating gun control to other matters until at least after the July 4 holiday.

It was the latest setback for proponents of gun restrictions who have been thwarted for years on Capitol Hill by gun rights defenders and the National Rifle Association.

Frequent efforts at gun control have failed despite anger at mass shootings like the killings at an elementary school in Newtown, Connecticut, in 2012 and in San Bernardino, California, last year.

“Eventually this problem will get addressed again one of two ways: We find a breakthrough, which I will seek, or there will be another terrorist attack which will bring us right back to this issue. I hope we can do it without another terrorist attack,” said Senator Lindsey Graham, a Republican who supported Collins.

A few hours earlier, Democratic lawmakers ended a sit-in protest in the House of Representatives over guns.

Fueled by Chinese food and pizzas, dozens of them stayed on the House floor all night, at times bursting into the civil rights anthem “We Shall Overcome” before giving up their protest after 25 hours.

“It’s not a struggle that lasts for one day, or one week, or one month, or one year,” said Representative John Lewis, a Democrat from Georgia and a key figure in the civil rights protests of the 1960s. “We’re going to win the struggle,” said Lewis, who led the House sit-in.

Dramatic protests by legislators are rare in the U.S. Capitol and the sit-in underscored how sensitive the gun control issue became after this month’s Florida attack, the deadliest mass shooting in modern U.S. history.

Opinion polls show Americans are increasingly in favor of more restrictions on guns in a country with more than 310 million weapons, about one for every citizen.

ORLANDO ATTACK

After a gunman pledging allegiance to Islamic State fatally shot 49 people at a gay nightclub in Orlando, some senators had seen resistance to gun restrictions softening because the issue had partly become one of national security.

But Collins’ measure received only 52 votes in the 100-seat Senate test vote, short of the 60 votes that would be needed for approval in future Senate procedural votes.

While her plan could be revived next month, it is unclear if she has the momentum to overcome pro-gun rights forces in Congress who argue that gun control measures in Congress have been too restrictive and trample on the constitutional right to bear arms. Four other gun control measures failed earlier this week.

Collins, a Maine lawmaker, wants to forbid gun sales to anyone on the U.S. government’s “No Fly List” for terrorism suspects or the “Selectee List” of people who receive extra security screening at airports.

Despite the lack of legislation, the gun debate has stirred passions. The House Democrats’ sit-in brought an outpouring of grass-roots activity.

Jennifer Hoppe, deputy director of Moms Demand Action for Gun Sense in America, said that in less than 24 hours from Wednesday, about 130,000 calls were made from supporters of gun control to members of Congress.

First lady Michelle Obama backed the House Democrats’ protest.

“We have grieved for too many children and wept for too many families after shootings. Chicago. Tucson. Newtown. Charleston. Orlando. #Enough,” she wrote on Twitter on Thursday.

The Democrats were seeking votes on legislation to expand background checks for gun purchases, as well as measures to curb the sale of weapons to people on government watch lists

Republicans allied with the NRA gun rights group say that while they want to combat terrorism, they represent constituents who believe firmly in the constitutional right to bear arms.

“It’s a tough issue. For people like myself, who come from a hunting and fishing state, it’s pretty hard,” said Senator Orrin Hatch, a conservative Utah Republican who voted against Collins.

(Additional reporting by Richard Cowan, Timothy Ahmann, Timothy Gardner and Eric Walsh, Doina Chiacu; Writing by Alistair Bell; Editing by Bill Trott and Peter Cooney)

Split U.S. Supreme Court blocks Obama immigration plan

Immigration activists at Supreme Court

By Lawrence Hurley

WASHINGTON (Reuters) – The U.S. Supreme Court on Thursday blocked President Barack Obama’s plan to spare millions of immigrants in the country illegally from deportation in a split ruling that heartened political foes who had accused him of overstepping his powers.

The 4-4 ruling, coming seven months before Obama’s term in office ends, marked the latest success that his Republican adversaries have had in thwarting a major policy initiative of the Democratic president. Obama had hoped that overhauling the U.S. immigration system and resolving the fate of the estimated 11 million people in the country illegally would be part of his presidential legacy.

The ruling is likely to further amplify the role that the immigration issue will play in the run-up to the Nov. 8 presidential election in which voters will pick Obama’s successor. It also leaves in legal limbo the roughly 4 million people Obama’s action was meant to help.

Obama unveiled his plan in November 2014. It was quickly challenged in court by Republican-governed Texas and 25 other states that argued that Obama overstepped the powers granted to him by the U.S. Constitution by infringing upon the authority of Congress. His unilateral executive action bypassed the Republican-led Congress.

Because the court was split, a 2015 lower-court ruling invalidating Obama’s plan was left in place. The plan never was implemented because the lower courts had blocked it.

The plan was tailored to let roughly 4 million people – those who have lived illegally in the United States at least since 2010, have no criminal record and have children who are U.S. citizens or lawful permanent residents – get into a program that shields them from deportation and supplies work permits.

A split ruling was possible because the court was down to eight justices, four liberals and four conservatives, after conservative justice Antonin Scalia died in February. The Republican-led Senate has refused to act on Obama’s nomination of appeals court judge Merrick Garland to replace Scalia.

In an appearance at the White House after the ruling, Obama expressed frustration at the court’s inability to issue a decisive ruling on the merits of the case and at Senate Republicans for “willfully” keeping the court shorthanded.

“I think it is heartbreaking for the millions of immigrants who made their lives here, who’ve raised families here, who hope for the opportunity to work, pay taxes, serve in our military, and fully contribute to this country we all love in an open way,” Obama said.

Obama said the U.S. immigration system has been broken for two decades and that this ruling set it back even further.

The issue of illegal immigration has featured prominently in the presidential campaign. Donald Trump, the presumptive Republican nominee, has called for deportation of all illegal immigrants – most of them from Mexico and other Latin American countries – and building a wall along the Mexican border.

The court did not reveal how each justice voted in the ruling, but it was possible the four liberals backed Obama and the four conservatives backed the states.

The court appeared divided along ideological lines during oral arguments on April 18, with liberals indicating support for the administration and conservative opposed.

‘MAJOR SETBACK’

The nation’s top elected Republican, U.S. House of Representatives Speaker Paul Ryan, and others in his party welcomed the ruling.

“This is a major setback to President Obama’s attempts to expand executive power, and a victory for those who believe in the separation of powers and the rule of law,” said Texas Attorney General Ken Paxton, a Republican.

The Constitution assigns certain powers to the executive, legislative and judicial branches of the federal government.

The split decision set no nationwide legal precedent on presidential power or immigration law. The ruling indicates that any major immigration policy change that would address the long-term situation of illegal immigrants would have to be enacted by Congress.

“We feel that justice has turned its back on millions of immigrants who, much like our founding fathers and mothers, sought a better future for themselves and their children and yet continue to live in the shadows without the respect and dignity that they deserve,” said Jorge-Mario Cabrera, a spokesman for the Coalition for Humane Immigrant Rights of Los Angeles.

The Obama administration could ask the high court to rehear the case, as losing parties in two other cases in which the court has split 4-4 have done. The court has not yet acted on those other petitions.

The Supreme Court decision does not affect a separate 2012 program aimed at protecting people brought to the United States as children from deportation, which Texas and the other states did not challenge.

Obama took the action after House Republicans killed bipartisan immigration legislation, billed as the biggest overhaul of U.S. laws on the matter in decades and providing a path to citizenship for illegal immigrants, that was passed by the Senate in 2013.

Maya Ledezma, an immigrant from Mexico who lives in Maryland, said would have been eligible for Obama’s program because she has lived in the United States for more than a decade and has an 8-year-old daughter who is a U.S. citizen.

“My life would have changed if the vote had been favorable,” she said through a translator during a rally outside the Supreme Court.

Republicans have been critical of Obama’s use of executive action to get around Congress on immigration policy and other issues such as gun control and healthcare.

Presumptive Democratic presidential nominee Hillary Clinton criticized the ruling for “throwing millions of families across our country into a state of uncertainty.” Trump said the ruling “blocked one of the most unconstitutional actions ever undertaken by a president.”

(Additional reporting by Ayesha Rascoe and Emily Stephenson in Washington and Alex Dobuzinskis in Los Angeles)

U.S. completes ‘takedown’ of Medicare fraud: officials

Attorney General Loretta E. Lynch

By Sarah N. Lynch

WASHINGTON (Reuters) – U.S. law enforcement officials have charged 301 suspects with trying to defraud Medicare and other federal insurance programs in 2016, marking the “largest takedown” involving health care fraud allegations, the Justice Department said on Wednesday.

The national sweep resulted in charges against doctors, nurses, pharmacists and physical therapists accused of fraud that cost the government $900 million, the department said.

The cases involved an array of charges, including conspiracy to commit health care fraud, money laundering and violations of an anti-kickback law.

This year’s sweep exceeded last year’s record in which 243 defendants faced charges in a combined $712 million in government losses. Officials said it was the largest takedown in the nine-year history of the Medicare Fraud Strike Force, a joint initiative between federal, state and local law enforcement.

Attorney General Loretta Lynch said some of the cases reflect new, troublesome trends, including instances of identity theft in order to prepare fake prescriptions and a growing number of cases involving compounding, or the mixing of medications tailored to meet a patient’s needs.

Compounded medications are typically very expensive. From 2012 to 2014, the quarterly Medicare spending on these prescriptions skyrocketed from $28 million to $171 million.

“As this takedown should make clear, health care fraud is not an abstract violation or benign offense,” Lynch said. “It is a serious crime.”

In one case, two owners of a group of outpatient clinics and a patient recruiter stand accused of filing $36 million in fraudulent claims for physical therapy and other services that were not medically necessary.

The Justice Department said that to find patients, the clinic operators and the recruiter targeted poor drug addicts and offered them narcotics so they could bill them for services that were never provided.

Another case was filed against the operator of a marketing business that received referral fees from pharmacies that filled and billed Tricare, the U.S. military’s government insurance program, for compounded medicines.

The prescriptions were submitted via “telemedicine” sites, and doctors were given blank prescription forms to fill out, regardless of medical necessity, according to the complaint.

One doctor told the FBI her identity and medical credentials were used without her permission to fill thousands of dollars worth of prescriptions.

drcolbert.monthly

Israel’s Netanyahu aims to head off criticism with diplomatic blitz

Benjamin Netanyahu Israel Prime Minister in meeting

By Luke Baker

JERUSALEM (Reuters) – Prime Minister Benjamin Netanyahu will fly to Rome on Sunday to try to fend off pressure from the United States and Europe over his settlements policy and opposition to a French-led effort to forge peace with the Palestinians.

Beginning three days of intense diplomacy, the right-wing premier will meet U.S. Secretary of State John Kerry and the European Union’s foreign policy chief, Federica Mogherini, in the Italian capital, followed by talks with U.N. Secretary General Ban Ki-moon in Jerusalem.

One of Netanyahu’s immediate concerns is a forthcoming report from the Middle East Quartet, a mediation group made up of the United States, EU, United Nations and Russia, that is expected to use unusually tough language in criticising Israel’s expansion of settlements on occupied land that the Palestinians seek for an independent state.

Diplomats confirmed that the current language in the report is strong, on the one hand condemning Israel’s unchecked building of settlement homes, which is considered illegal under international law, and on the other persistent Palestinian incitement against Israel during a recent wave of violence.

What is unclear is whether the wording may be softened before the report is issued, probably next week, although its publication has already been delayed several times.

“As it stands, the language is strong and Israel isn’t going to like it,” said one diplomat briefed on the content. “But it’s also not saying that much that hasn’t been said before – that settlements are a serious obstacle to peace.”

Netanyahu spoke by phone to Russian President Vladimir Putin this week as part of his efforts to keep the Kremlin closely updated on developments in the region. The leaders have met face-to-face four times in the past year, with one Israeli official saying the two had developed a good understanding.

As well as a desire to defang the Quartet report, there are a series of issues Netanyahu needs to broach with Kerry, including how to conclude drawn-out negotiations with Washington on a new, 10-year defence agreement.

There is also the looming issue of a peace conference organised by the French that is supposed to convene in the autumn, although it may no longer take place in Paris.

Israeli officials oppose the initiative, seeing it as side-stepping the need for Israel and the Palestinians to sit down and negotiate directly. They argue that it provides the Palestinians a chance to internationalise the conflict, rather than dealing with the nitty-gritty on the ground.

Israeli President Reuven Rivlin, who addressed the European Parliament on Wednesday, said Israel was feeling impatience with Europe and now was not the right time to push for peace.

“Currently, the practical conditions, the political and regional circumstances, which would enable us to reach a permanent agreement between us — the Israelis and the Palestinians — are failing to materialise,” he said.

Many diplomats also question whether the French initiative can inject life into an all-but-defunct peace process, which last broke down in 2014, but they are willing to try.

A nagging concern for Israel is that the conference will end up fixing a time frame for an agreement on ending Israel’s 49-year-old occupation of the West Bank and East Jerusalem and reaching a two-state solution with the Palestinians.

If that doesn’t emerge from the French plan, it remains possible that a resolution along similar lines could be presented to the United Nations Security Council before the end of the year. That is another reason why Netanyahu will be eager to sit down with Ban for talks on Tuesday.

(Writing by Luke Baker; Editing by Mark Heinrich)