Three Arrested For Illegal Scheme To Export Controlled Data And Defraud The Department of Defense

The U.S. Attorney Office Western District of Kentucy released the below information:

WASHINGTON – A federal indictment was unsealed today following the arrest of three defendants and their initial appearances in the U.S. District Court in the Western District of Kentucky. Phil Pascoe, 60, of Floyds Knobs, Indiana, Monica Pascoe, 45, of Floyds Knobs, Indiana; Scott Tubbs, 59, of Georgetown, Kentucky; and Quadrant Magnetics LLC were charged with wire fraud, violations of the Arms Export Control Act, and smuggling of goods for their roles in an illegal scheme to send export-controlled defense-related technical data to China and to unlawfully supply U.S. Department of Defense (DOD) with Chinese-origin rare earth magnets for aviation systems and military items.  

The indictment alleges that between January 2012 and December 2018, the defendants conspired to send approximately 70 drawings containing export-controlled technical data to a company located in China without a license from the U.S. government, in violation of the Arms Export Control Act and the International Traffic in Arms Regulations. The technical data drawings were the property of two U.S. companies and related to end-use items for aviation, submarine, radar, tank, mortars, missiles, infrared and thermal imaging targeting systems, and fire control systems for DOD.

The indictment further alleges that Quadrant Magnetics imported rare earth magnets that were smelted and magnetized by a company in China. Quadrant then sold these magnets to two U.S. companies which included them in components sold to DOD for use in the F-16, the F-18, and other defense assets in violation of the Defense Acquisition Regulations System (DFARS). Under the DFARS specialty metal clause, rare earth magnets sold to DOD must be produced and magnetized in the United States or an approved country. China is not an approved country. 

Arraignments will be scheduled before a U.S. Magistrate Judge in the U.S. District Court for the Western District of Kentucky. If convicted, Phil Pascoe, Monica Pascoe and Scott Tubbs face statutory maximum penalties of up to 20 years in prison for each count of wire fraud; 20 years in prison for each count of exporting technical data without a license; and 10 years in prison for smuggling goods from the United States. Monica Pascoe and her co-defendants face a penalty of up to five years for conspiracy to defraud the United States. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division, U.S. Attorney Michael A. Bennett for the Western District of Kentucky, Assistant Director Alan E. Kohler Jr. of the FBI Counterintelligence Division and Special Agent in Charge Jodi Cohen of the FBI Louisville Field Office made the announcement.

The Defense Criminal Investigative Service, FBI, the Department of Homeland Security, IRS - Criminal Investigation, the Naval Criminal Investigative Service, and the Department of Energy’s Office of Inspector General are investigating the case.

Assistant U.S. Attorneys Joshua Judd and Christopher Tieke for the Western District of Kentucky and Trial Attorneys David Recker and Liz Abraham with the National Security Division’s Counterintelligence and Export Control Section are prosecuting the case. 

An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

DOD: Liberation Of Kherson 'Significant Accomplishment' for Ukraine

C. Todd Lopez at the DOD News offers a piece on the Russian withdrawal from Kherson.

Over the weekend, Russian forces withdrew from Kherson in Ukraine, a city of more than 280,000. It's a big win for the Ukrainian people and its military, one senior military official said during a briefing at the Pentagon.     

The most significant development over the weekend was the Russian military's withdrawal from Kherson City and the west bank of the Dnipro River," the official said. "While we continue to monitor, we do assess that Russian forces have relocated onto the eastern side of the river and established their defensive lines, thus ceding a significant amount of territory to the Ukrainians to include your Kherson City." 

The official said Ukrainian forces continue to consolidate gains and are now busy clearing obstacles and mines left behind by the Russians. The Ukrainians are also assessing the damage done by the Russian occupiers before they departed; the official said indications are that the Russians did significant damage to civilian infrastructure in Kherson, including water and other utility systems. 

"The Russians don't appear inclined to depart the rest of occupied Ukraine, [and] there's undoubtedly still tough fighting ahead," the official said. "But the liberation [of] Kherson City is a significant accomplishment and a testament to the grit, determination and tenacity of the Ukrainian people and their armed forces as they fight to defend their nation." 

You can read the rest of the piece and see photos via the below link:

Liberation of Kherson 'Significant Accomplishment' for Ukraine > U.S. Department of Defense > Defense Department News 

A Little Humor: Fetterman Realizes American Dream Of Living With Parents Til You're 50 And Then Getting A Government Job

The Babylon Bee offers a clever satire of Senator-elect John Fetterman.

HARRISBURG, PA — Senator-elect John Fetterman has finally realized the American dream by living with his parents until at least the age of 50 before smoothly transitioning into a cushy government job.

Fetterman, 53, told his parents they wouldn't need to make him dinner on January 3 because he will be in Washington, D.C. trying to make his dream come true for every American.

The senator-elect, who famously served as the mayor of Braddock, PA from his parent's basement, has said that he's excited to finally leave the nest. "I asked and they won't move to D.C.," said Fetterman. "I want pancakes."

The parents of the freshman senator are reportedly happy to see their son finally strike out on his own and show the world what it means to have loving parents who will care for you for most of your life. "Freaking finally," his loving father told reporters. "I mean, come on. I thought he would never leave." 

You can read the rest of the humor piece via the below link:

Fetterman Realizes American Dream Of Living With Parents Til You're 50 And Then Getting A Government Job | Babylon Bee 

Former U.S. Navy Nuclear Engineer And His Wife Sentenced For Espionage-Related Offenses

The U.S. Justice Department released the below information:

WASHINGTON – A Maryland man and his wife were sentenced today for conspiracy to communicate Restricted Data related to the design of nuclear-powered warships.

Jonathan Toebbe (seen in the above photo), 44, of Annapolis, was sentenced to 19 years and 4 months of incarceration and fined $45,700. His wife, Diana Toebbe, 46, was sentenced to 21 years and 10 months of incarceration and fined $50,000. The Toebbes pleaded guilty to the conspiracy in August 2022.

“If not for the remarkable efforts of FBI agents, the sensitive data stolen by Mr. Toebbe could have ended up in the hands of an adversary of the United States and put the safety of our military and our nation at risk,” said U.S. Attorney Ihlenfeld. “The FBI keeps American citizens safe from enemies both foreign and domestic and this case is an excellent reminder of their important work.”

“The Toebbes were willing to compromise the security of the nation by selling information related to naval nuclear propulsion systems. They are now being held accountable for their actions,” said FBI Pittsburgh Special Agent in Charge Mike Nordwall. “The FBI and our federal partners have an unwavering commitment to protect U.S. secrets and will continue to aggressively investigate and expose espionage activities conducted on U.S. soil.”

According to court documents, at the time of his arrest, Jonathan Toebbe was an employee of the Department of the Navy who served as a nuclear engineer and was assigned to the Naval Nuclear Propulsion Program, also known as Naval Reactors. He held an active national security clearance through the Department of Defense, giving him access to “Restricted Data” within the meaning of the Atomic Energy Act. Restricted Data concerns design, manufacture or utilization of atomic weapons, or production of Special Nuclear Material (SNM), or use of SNM in the production of energy – such as naval reactors. Jonathan Toebbe worked with and had access to information concerning naval nuclear propulsion including information related to military sensitive design elements, operating parameters and performance characteristics of the reactors for nuclear powered warships.

According to court documents, Jonathan Toebbe sent a package to a foreign government, listing a return address in Pittsburgh, Pennsylvania, containing a sample of Restricted Data and instructions for establishing a covert relationship to purchase additional Restricted Data. Jonathan Toebbe began corresponding via encrypted email with an individual whom he believed to be a representative of the foreign government. The individual was really an undercover FBI agent. Jonathan Toebbe continued this correspondence for several months, which led to an agreement to sell Restricted Data in exchange for thousands of dollars in cryptocurrency.

On June 8, 2021, the undercover agent sent $10,000 in cryptocurrency to Jonathan Toebbe as “good faith” payment. Shortly afterwards, on June 26, Jonathan Toebbe serviced a dead drop by placing an SD card, which was concealed within half a peanut butter sandwich and contained military sensitive design elements relating to submarine nuclear reactors, at a pre-arranged location. After retrieving the SD card, the undercover agent sent Jonathan Toebbe a $20,000 cryptocurrency payment. In return, Jonathan Toebbe emailed the undercover agent a decryption key for the SD Card. A review of the SD card revealed that it contained Restricted Data related to submarine nuclear reactors. On Aug. 28, Jonathan Toebbe made another “dead drop” of an SD card in eastern Virginia, this time concealing the card in a chewing gum package. After making a payment to Jonathan Toebbe of $70,000 in cryptocurrency, the FBI received a decryption key for the card. It, too, contained Restricted Data related to submarine nuclear reactors. The FBI arrested Jonathan Toebbe and his wife on Oct. 9, after he placed yet another SD card at a pre-arranged “dead drop” at a second location in West Virginia.

The FBI and NCIS are investigating the case.

Trial Attorneys Matthew J. McKenzie and S. Derek Shugert of the National Security Division's Counterintelligence and Export Control Section, Assistant U.S. Attorneys Jarod J. Douglas and Lara Omps-Botteicher of the Northern District of West Virginia, and Special Assistant U.S. Attorney Jessica Lieber Smolar for the Western District of Pennsylvania prosecuted the case.

Veterans Day 2022: Honoring And Remembering All Who Served

On this Veterans Day, 2022, I'm thinking about my late older brother Ed Davis (seen in the above photo), who served as a soldier in Chu Lai, South Vietnam in 1968-1969.

I'm also thinking of my late father, Edward Miller Davis (seen in the center of the above photo), who was a chief petty officer and a UDT frogman in WWII.

I'm proud to say that I'm also a veteran, having served on the aircraft carrier USS Kitty Hawk during the Vietnam War in 1970-1971.  

I also served on a U.S. Navy harbor tugboat, the USS Saugus, at the U.S. nuclear submarine base at Holy Loch, Scotland in 1974-1975. 

I salute all who served in the armed forces. 

Too Many Philly Cops Are Saying, “Exit, Stage Left!”

Broad + Liberty ran my piece on Philly cops retiring and quitting in alarming numbers.

You can read the piece via the below link or the below text:

Paul Davis: Too many Philly cops are saying, "Exit, Stage Left!" (broadandliberty.com)

Back in the early 1960s there was a Hanna-Barbera cartoon on TV that featured an entertaining pink mountain lion named Snagglepuss. 

Snagglepuss, who wore an upright collar, bow tie and cuffs, had a distinctive voice and a theatrical bent. He often broke the “fourth wall” and spoke directly to the TV audience, offering his narration and goofy asides, and he often uttered his catchphrase, “Heavens to Murgatroyd!” 

In times of difficulty, Snagglepuss would raise a leg, look directly out at his TV audience, and say, “Exit, stage left!”    

Sadly, today many Philadelphia police officers are emulating Snagglepuss and exiting stage left in alarming numbers.   

I know a veteran Philadelphia police officer who some years ago told me that he would never retire.

“I’m gonna die on the job,” the officer said.

That was then. 

That officer recently told me that he was retiring. He said the job has changed. 

“Cops get no support from the city’s leaders, the media and the public,’ the officer said. “It’s like they are just waiting for a good cop to f*** up, just once, so the mayor and the police commissioner can disown him, the media can condemn him, and the DA can prosecute him.”

The once proud officer told me he has had enough and he is moving on, like so many other highly trained and experienced police officers.

As former Philadelphia Daily News and Inquirer columnist Stu Bykofsky noted in a piece in Philadelphia Weekly last year, the police are defunding themselves.

“Anti-cop critics may not have to actually ‘defund the police.’ Philadelphia police are depopulating their own ranks in an unprecedented dash for the doors. More Philadelphia police officers have put in for DROP this past year than in any year in the past decade, except for one, which indicates deep dissatisfaction in the ranks,” Bykofsky wrote. “In 2020, 135 officers filed for retirement, trailing only the 159 officers who put in for retirement in 2018. However, 114 cops put in their papers in January 2021 alone, a number that is greater than the total for most years. The combination of 2020 and January 2021 totals a record of 249. If January is a harbinger, 2021 will shatter all records. 

“What’s driving most of the fleeing cops out of a job they used to love is a sense of betrayal.” 

Rebecca Rhynhart, who recently resigned as city controller to run for mayor, released her office’s “Review and Analysis of the Philadelphia Police Department and Other Related Police Spending” last month. 

As one key finding in the executive summary noted, “With about 95% of PPD’s funding spent on personnel costs, the review examined PPD’s staffing trends in detail. PPD’s staffing levels have decreased significantly in recent years, from 6,590 filled uniform positions at the end of FY 2019 to 5,983 at the end of FY 2022. Based on recent attrition and recruiting trends, this total is likely to continue to decrease and could fall below 5,200 by the end of FY 2025 if the department does not increase its recruitment and retention of officers.”

The cops who are retiring or quitting say they worry about deadly confrontation with criminals armed with illegal guns. If the cops draw their firearm and kill a suspect, they run the risk of being fired by an unsupportive mayor and commissioner, and being prosecuted by an anti-cop, progressive DA.

If they don’t draw their firearm and kill the suspect, that suspect may very well kill them. 

And they have about two seconds to make that fateful decision.

Anti-cop protesters can hurl bricks, bottles and unidentifiable liquids at officers, but if an officer responds by physically arresting the offender, he may very well be captured on someone’s cell phone video, which may lead to the officer’s firing and prosecution.

Definitely a hostile work environment. 

So what can be done to retain veteran officers and recruit new highly qualified officers? 

As a crime reporter and columnist, I’ve been covering the cops for nearly 30 years. Over the years, I’ve interviewed police commissioners, deputy commissioners and other senior officers. I’ve also gone out on many “ride-alongs” with patrol officers, detectives and plainclothes narcotics officers. 

Nearly every cop I’ve spoken to, from high-ranking officers to the rank and file, say that there needs to be more support from politicians and political appointees, as well as from the media and the public. 

For starters, a cop that appears to have erred should be given the benefit of the doubt and presumed innocent, and not immediately be crucified. Too often cops are villainized, and criminals are canonized

“Cops arrest the bad guys, but they are either released quickly without bail, or not prosecuted at all,” the retiring veteran officer said. “Who needs this?”

Paul Davis is a South Philadelphia writer who covers crime. 

Former U.S. Military Pilot Sentenced For Acting As Paid Agent Of China And Lying On National Security Background Forms

The U.S. Justice Department released the below information:

SAN DIEGO – Former U.S. Army helicopter pilot-turned-civilian-contractor Shapour Moinian was sentenced in federal court today to 20 months for acting as an agent of China and accepting thousands of dollars from representatives of the Chinese government to provide aviation-related information from his defense-contractor employers.

During today’s sentencing hearing, U.S. District Judge Jeffrey T. Miller told the defendant: “This was industrial espionage, bordering on military espionage…These were extremely serious offenses against the United States.”

U.S. Attorney Randy Grossman said: “Today this defendant is being held to account for selling American technology and intellectual property to the Chinese. This crime was committed by a former member of the U.S. military who chose cash over his company and country. The United States will aggressively investigate and prosecute anyone who works at the direction of foreign governments to steal from Americans.”

“Mr. Moinian deserves to be held fully accountable for betraying his oath to the United States, selling sensitive information to the Chinese government, and lying repeatedly to cover up his crimes,” said Special Agent in Charge Brice Miller of the NCIS Office of Special Projects. “This sentencing should make it clear: NCIS and our partners are fully committed to protecting the U.S. military and rooting out criminality that threatens the superiority of the U.S. warfighter.”

Moinian served in the Army in the United States, Germany, and South Korea from approximately 1977 through 2000. After his service, Moinian worked for various cleared defense contractors (CDC) in the United States – including in San Diego - as well as the Department of Defense. “Cleared” is a term that indicates a contractor is permitted to work on projects that involve classified information.

According to his plea agreement, while Moinian was working for a CDC on various aviation projects used by the military and U.S. intelligence agencies, he was contacted by an individual in China who claimed to be working for a technical recruiting company. This person offered Moinian the opportunity to consult for the aviation industry in China.

In March of 2017, Moinian travelled to Hong Kong where he met with this purported recruiter and agreed to provide information and materials related to multiple types of aircraft designed and/or manufactured in the United States in exchange for money. Moinian accepted approximately $7,000-$10,000 in United States currency during that meeting. According to his plea agreement, at this meeting and at all subsequent meetings, Moinian knew that these individuals were employed or directed by the government of the People’s Republic of China.

Upon returning to the United States, Moinian began gathering aviation-related materials, which included transferring material from a CDC to a thumb drive. In September 2017, Moinian traveled overseas. During a stopover at the Shanghai airport, he met with Chinese government officials and provided aviation-related materials on a thumb drive, including proprietary information from a CDC. Thereafter, Moinian arranged to be paid for this information through the South Korean bank account of his stepdaughter. Moinian told his stepdaughter that these funds were payment for his consulting work overseas and instructed her to transfer the funds to him in multiple transactions.

Moinian also received a cell phone and other equipment from these individuals to communicate with them and aid in the electronic transfer of materials and information.

At the end of March 2018, Moinian traveled to Bali and met with these same individuals again. Later that year, he began working at another CDC. During this timeframe, the same individuals in China transferred thousands of dollars into the South Korean bank account of Moinian’s stepdaughter, who subsequently wired the funds to Moinian in multiple transactions.

In August 2019, Moinian traveled again to Hong Kong and met with these same individuals where he was again paid approximately $22,000 in cash for his services. Moinian and his wife smuggled this cash back into the United States.

Moinian also admitted that he lied on his government background questionnaires in July 2017 and March 2020, when he falsely stated that did not have any close or continuing contacts with foreign nationals and that no foreign national had offered him a job.

Grossman thanked the prosecution team as well as the FBI, Naval Criminal Investigative Service  and the Department of Justice’s National Security Division for their excellent work on this case.

DEFENDANTS                                          Case Number          21CR02927-JM

Shapour Moinian                                   Age: 67                 San Diego

SUMMARY OF CHARGES

Title 18, United States Code, Section 951 (Acting as an Agent of a Foreign Government)

Maximum penalty: Ten years in prison and $250,000 per count fine

Title 18, United States Code, Section 1001 (Materially False, Fictitious, or Fraudulent Statement or Representation)

Maximum penalty: Five years in prison and $250,000 per count fine

INVESTIGATING AGENCIES

Federal Bureau of Investigation

Naval Criminal Investigative Service

Topic(s): 

Foreign Corruption

Component(s): 

USAO - California, Southern

Press Release Number: 

CAS2