Intelcenter / AFP - Getty Images file

Al-Qaida leader Ayman al-Zawahiri speaks in a video released by al-Qaida's media arm as-Sahab on March 16.

Editor's note: A correction had been made to this article. Click here to view it:

Fugitive al-Qaida leader Ayman Al-Zawahiri has released a new audio message about Yemen at a time of escalating fighting in the country that one Yemeni official on Tuesday described as "all-out war."

The release of the audio comes just two days after White House counterterrorism adviser John Brennan visited the Yemeni capital of Sanaa to meet with its new president, Abed Rabbo Mansour Hadi, to discuss ramping up the battle against al-Qaida affiliated militants who now control large swaths of the country's southern region.

While there is still no public translation of the new Zawahiri audio message, a U.S. government official familiar with the contents tells NBC News it was clearly recorded before the news broke last week about a foiled plot to blow up a U.S. airliner with more-sophisticated underwear bomb.

The message discusses the transition from exiled former Yemeni president Ali Abdullah Saleh to Hadi, said the official, speaking on condition of anonymity.

Watch world news videos on msnbc.com

NBC News terror analyst Evan Kohlmann notes that there is typically a two- to three-week lapse between the events described in Zawahiri’s messages and their public release.  (Kohlmann's Flashpoint Intel service is working to translate the message, but he gives the title as, "Yemen: Between a Fugitive Puppet and a Collaborating Stooge," apparent references to Saleh and Hadi.)

Read more reporting by Michael Isikoff in the 'Isikoff Files'

Over the past week and a half, Yemeni forces -- backed by U.S. military trainers and drone strikes -- have dramatically escalated their attacks on al-Qaida militants in the south.

A Yemen government official estimated as many as 20,000 troops were now involved in the battle, supported by approximately 50 to 60 U.S. trainers.

"We have begun to reintroduce small numbers of trainers into Yemen," a Pentagon spokesman, a Navy Capt. John Kirby, told reporters this week. 

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• Aussie Olympic hopeful loses bet over 'mankini' at opening ceremony
• Hipsters to the rescue? UK celebrity venue in spat with Jaguar
• Vatican allows mobster to be exhumed for clues in disappearance
• Iran hangs ‘Israel spy’ over nuclear scientist killing
• Mexico's drug war: No sign of 'light at the end of the tunnel'

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Traffic on Tropicana Avenue in Las Vegas, Nevada, passes in front of the MGM Grand.

SAN FRANCISCO -- To prime itself for the U.S. debut of legal online poker, MGM Resorts International, owner of such Las Vegas Strip monuments as the MGM Grand, the Bellagio and the Mirage, wanted a partner that knew the ropes.

So last October it hooked up with Bwin.Party Digital Entertainment Plc, a London-listed, Gibraltar-based specialist that rakes in more from Web betting than any other publicly traded company. MGM Resorts took 25 percent of a new venture 65 percent owned by Bwin.Party, with smaller Las Vegas casino operator Boyd Gaming getting the remaining 10 percent.

Reuters

MGM Resorts International CEO Jim Murren attends a news conference in Hong Kong on May 19, 2011. Murren says his company's online poker tie-up with Bwin.Party, backed by onetime phone-sex and porn entrepreneur Ruth Parasol, gives it a competitive edge.

"We'll be out of the gate as soon as anybody," MGM Resorts Chief Executive Officer Jim Murren boasted to investors in February. 

Online expertise isn't the only thing that distinguishes Bwin.Party. In 2009, an earlier incarnation of the company paid $105 million while admitting to U.S. prosecutors it had run an illegal gambling operation and engaged in bank and wire fraud.

Among its principal backers: a California-born woman who made a fortune in phone sex and Web pornography businesses that, like the pioneering online-gambling company that became Bwin.Party, faced multiple allegations of wrongdoing.

MGM Resorts' choice of Bwin.Party as a partner while applying for online poker licenses in Nevada might seem unusual. It isn't. The alliance reflects the calculated risks that major casino operators, Native American tribes and social-gaming giants Zynga and Facebook are weighing as they angle for a slice of a market valued at billions of dollars a year. 

Caesars Entertainment Corp is prepping for online poker by tying up with an Israeli company that in 2007 acknowledged settlement talks with the U.S. Justice Department over alleged breaches of anti-gambling laws.

A group of Native American tribes in California has signed up to use software from another Israeli company, run by a man who served prison time for stock manipulation and bribery. Another tribe last week announced a deal with Bwin.Party.

Zynga, eager to convert some of its tens of millions of virtual poker enthusiasts into cash gamblers, also has been in talks with Bwin.Party and others that have had brushes with the law, according to people familiar with the matter.

Meanwhile, offshore gambling outfit PokerStars is considering buying its chief offshore rival, Full Tilt, and making a run at the U.S. market even though founders of both were indicted by the Justice Department last year on charges of illegal gambling, bank fraud and money laundering, according to people familiar with the situation. 

All this comes as Nevada prepares to license the first online poker operators and software suppliers late next month -- and as California, New Jersey, Iowa, Massachusetts, Delaware and other states debate similar moves.

Many of the cash-starved states, encouraged by intensive industry lobbying, have felt freer to act since December, when the Justice Department declared that one federal anti-gambling law, the Wire Act, would no longer be enforced beyond sports betting.

But casino operators, Indian tribes and Internet powers bent on offering online poker lack experience delivering it. Online poker is a business that involves processing billions of dollars worth of bets and battling the fraudsters, cheats and robot-player software that can ruin the games. Hence the casinos are cozying up to some tech-savvy offshore partners whose pedigrees might give regulators pause. 

Most states have "suitability" rules designed to keep crooks out of the gambling industry. Nevada requires that successful license applicants and their large shareholders possess "good character, honesty and integrity." Nevertheless, the big casino operators and their offshore partners are betting that regulators will look favorably on their license applications for two good reasons: tax money and high-tech jobs.

Early indications are that they are right.

At a hearing on a Caesars deal with the Israeli company last year, Mark Lipparelli, chairman of Nevada's Gaming Control Board, said: "I don't think as we look at companies that we can have perfection as the standard, because I think that would be a disservice to the state in attracting business here." The board unanimously recommended approval of the venture.

Gambling foes warn that states are putting fiscal worries ahead of public safety, exposing a huge and vulnerable population to the potential for compulsive betting. "The governments are so desperate for revenues that they will partner with these lawbreaking outfits," said Les Bernal, executive director of the nonprofit Stop Predatory Gambling Foundation in Washington, D.C. "They will create addiction in order to feed off of it." 

Porn and cards
Jim Ryan, co-chief executive officer of Bwin.Party, acknowledged in an interview that when the company was looking for U.S. partners, its history was a chief concern of MGM Resorts and other U.S. companies. 

Reuters

Jim Ryan, co-CEO of Bwin.Party Digital Entertainment, sits on a discussion panel during the GiGse online gaming convention at the Westin hotel in San Francisco on April 24.

"Suitability is the very first question on all of their minds," he told Reuters during a recent business trip to San Francisco.

It's easy to see why. 

Bwin.Party grew out of PartyGaming, a brainchild of San Francisco-area native Ruth Parasol, who has a history as colorful as Las Vegas. After earning a law degree, Parasol first prospered in the 1990s through 1-900 phone-sex and other services that were sued by multiple states for aggressive billing and collection practices. In North Carolina's suit, the judge ordered a company she co-founded to pay $270,000 in damages.

Then Parasol put her money behind Internet Entertainment Group, which gained notoriety for releasing an early Pamela Anderson sex video and promising an initial public offering that never happened. Employees accused the company of routinely overbilling customers, and Chief Executive Seth Warshavsky fled to Thailand as authorities investigated. Warshavsky didn't respond to an interview request.

Parasol managed to emerge unscathed, and in 1997 founded Starluck Casino in the Caribbean, providing online gambling to customers in the U.S. and elsewhere. The company had a big hit with its PartyPoker website, which became the dominant force in U.S. online cards, and then renamed itself PartyGaming.

Parasol, who has been living in Gibraltar for most of the past decade, declined requests for an interview.

In 2005, PartyGaming's IPO became the largest London had seen in four years, valuing the company at more than $8 billion. Just then, debate over the U.S. legal status of online gambling flared.

Poker players sue to get to bottom of online cheating scheme

The Justice Department had long argued that Internet poker violated the Wire Act and other federal and state laws. Despite the success of PartyGaming and other offshore companies, no U.S.-based companies offered alternatives for fear of prosecution. 
In 2006, Congress clarified the matter by passing the Unlawful Internet Gambling Enforcement Act, or UIGEA, explicitly barring processing interstate or international poker transactions where state laws forbade such gambling. PartyGaming responded by pulling out of the U.S., leaving two-thirds of its players behind to be claimed by privately held offshore companies.

The law didn't snuff out online poker in the U.S. as players migrated to other offshore providers. Research firm H2 Gambling Capital estimates the U.S. accounts for about $400 million of global annual online poker revenue of nearly $5 billion, or 8 percent. Depending on how many states ultimately legalize online cards, that share could rise to as high as 28 percent in five years, the company says.

PartyGaming's problems didn't end when it left the United States. In 2008, co-founder Anurag Dikshit pleaded guilty to gambling via the wires in federal district court in New York. He forfeited $300 million and agreed to cooperate with prosecutors, leading PartyGaming itself to settle in 2009. The company paid $105 million to avoid prosecution for pre-UIGEA violations. Dikshit couldn't be reached. His lawyer didn't return calls seeking comment. 

In 2010, prosecutor Arlo Devlin-Brown told the court that the probe was continuing and referred to documents under seal. He recently told Reuters he could not comment further, leaving open the possibility that Parasol could be charged if she returns home to the United States. 

PartyGaming's fortunes recovered as it began to focus on non-U.S. customers. Last year it bought rival Bwin Interactive of Austria and changed the merged company's name to Bwin.Party, with annual revenue of 691 million euros, or $902 million. 

During the merger talks, the regulatory suitability of PartyGaming and Parasol became an issue. Parasol and her husband, Russell DeLeon, agreed that the board could force them to restructure their more than 13 percent stake in the merged company or sell it if "required by any gaming regulatory authority in connection with business opportunities," according to merger documents filed with regulators. 

That clause wouldn't apply, however, if the licensing process is "more burdensome to the principal PartyGaming shareholders than the licensing requirements currently imposed by the state of Nevada." That means the couple's stake could, in effect, block deals in states with tougher standards. Bwin.Party's Ryan said he couldn't imagine the couple standing in the way. DeLeon couldn't be reached for comment.

Now partnered with MGM Resorts, Bwin.Party has applied for a Nevada license to offer Internet poker software and services. Co-CEO Ryan said the joint venture will handle all U.S. games where players pay to play and can cash out their winnings. 

In the meantime, he said, Bwin.Party will promote its brands through a social game, to be announced soon, without the ability to cash out. Ryan said negotiations with Facebook, a likely game platform, are continuing.

Facebook declined to comment. MGM did not respond to repeated interview requests about its choice of Bwin.Party.

'Prettiest girl in town'  
One of Bwin.Party's top rivals is also listed in London but based in Israel. That company is 888 Holdings, founded by a dentist inspired to put poker on the Net after a 1996 trip to Monte Carlo. The late Aharon Shaked and his brother Avi mortgaged their homes to fund the company, and their families and a co-founding family still have majority control.

In 2006, 888 joined PartyGaming in pulling out of the U.S. market. But for a time before that, 888's Casino-on-Net gambling website was among the top 10 buyers of banner ads aimed at U.S. home Internet users, reaching more than 10 percent of them in a single week, according to Nielsen/NetRatings.

In 2007 the company acknowledged it was in settlement talks with the Justice Department over suspected breaches of pre-2006 anti gambling laws. No charges were filed.

The 888 deal with Caesars that Nevada regulators approved last year was a trial run of Caesars-branded online poker in the British market, where such games have been legal for years. Caesars, operator of the Strip's Caesars Palace, Harrah's and Rio, has since expanded its relationship with 888, agreeing to use its software in the United States once states approve.

Ambitions are running high at 888. "The most exciting market opportunity for the industry must be that of the States, and we are definitely the prettiest girl in town, with everybody keen to have discussions with us," 888 Chief Executive Officer Brian Mattingley told investors last month. Officials at 888 declined interview requests, as did those at Caesars.

Lipparelli, the Nevada Gaming Control Board chairman, said scrutiny of the initial Caesars venture was lower than what it would have been for a U.S. venture. He said current investigations of Bwin.Party, 888 and more than 20 other license applicants would be far more rigorous than anything the overseas outfits had experienced in their home countries. "Some will probably not make it through," Lipparelli said. 

He said confessions of pre-2006 wrongdoing wouldn't automatically prevent licensing, though. Gambling executives say they expect smooth sailing in Nevada because regulators want to add local technology jobs. Concern about past lawbreaking "has all gone away," one casino executive said. 

One big test could come in the case of PokerStars, based in the Isle of Man, and Full Tilt Poker, based in the Channel Islands, which together snapped up most of the U.S. market after the 2006 law was passed and PartyGaming ran for the exits.

Last year, on an April day known in online poker circles as Black Friday, federal prosecutors unsealed indictments alleging illegal gambling, bank fraud and money laundering against the founders of PokerStars and Full Tilt. Preet Bharara, U.S. Attorney for the Southern District of New York, said Full Tilt had operated as a Ponzi scheme, relying on new players' deposits to cover payouts to older customers while executives and advisers took hundreds of millions of dollars from player accounts.

The indictments prompted Wynn Resorts Ltd to drop a weeks-old "strategic relationship" with PokerStars. The main owner of Station Casinos, which serves Las Vegas locals at 11 casinos off the Strip, abandoned a similar tie-up with Full Tilt. Neither Nevada company returned calls seeking comment.

Full Tilt has shut down while it negotiates with the Justice Department. But PokerStars remains the biggest site worldwide, with what others in the industry believe tops $1 billion in annual revenue. It harbors hopes that a deal with prosecutors could pave the way for a return to the U.S. 

People familiar with the situation say that as part of the settlement talks with the Justice Department, PokerStars is considering buying Full Tilt and refunding U.S. players hundreds of millions of dollars missing from their accounts. PokerStars confirmed the settlement talks but declined to comment on Full Tilt or its American aspirations. Full Tilt officials couldn't be reached for comment. 

'Concerned about probity'  
In California, casinos and gambling-software companies already are scurrying for deals with the tribes and others that would be eligible for direct licenses under a bill pending in the state senate. Caesars manages the Rincon tribe's Harrah's casino and is hoping to build on that with software from 888. 

A coalition of tribes and card rooms known as the California Online Poker Association has signed up to use software from Playtech Ltd, a London-listed British company. About 40 per cent of Playtech is owned by Teddy Sagi, an Israeli billionaire who pleaded guilty to stock manipulation and bribery in 1996 in a scandal known as the Discount Affair. He was sentenced to nine months in prison. Playtech didn't respond to a request for comment.

The tribes are aware of the risks of choosing partners that won't satisfy the state Justice Department, which the current bill would empower to approve license applications.

"We are very, very concerned about probity," said Joaquin Fletcher, president of the Pechanga Development Corp, owner of the Pechanga Resort and Casino in Temecula, California. "We don't want whoever we pick to just create more nightmares down the road." 

Similar concerns are on the minds of social media companies.

Zynga, the dominant provider of recreational games on Facebook, has 36 million monthly average users of its Texas HoldEm Poker, the second most popular game on Facebook after its CityVille, according to market research firm AppData.

The card game doesn't require regulation because players don't receive cash payouts, though they often pay for extra chips to play with. Those virtual chip purchases have made the game one of Zynga's top earners and opened the company's eyes to the potential of the real thing. 

Lazard Capital Markets said in March that it expected Zynga to move "aggressively" and capture an extra $100 million in annual profit by offering online poker with cash payouts and prizes. 

Zynga has held talks with Bwin.Party, 888, multiple California tribes and card rooms, and the big brick-and-mortar casinos, people familiar with the discussions said. The company might experiment first with poker in well-regulated overseas markets such as the United Kingdom, they said. Zynga declined to comment.

The gambling majors have seen the promise of social networking as well. MGM Resorts, like Bwin.Party, is planning its own game without cash payouts but with social networking built in. Caesars recently bought game application developer Playtika, which has a popular free slot machine app on Facebook called Slotomania, and it launched a Caesars-branded casino game suite there, too. 
Despite the enthusiasm, the risks of a regulatory, legal or public-relations setback for Zynga and Facebook are substantial, even if they partner well. 

With millions of free players, "it's very likely these people can be converted" to playing for real money, said one longtime offshore poker executive. "But do they want a headline saying some kid lost $10,000 playing poker on Facebook?"

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New Jersey Governor's Office

N.J. Gov. Chris Christie with Lt. Gov. Kim Guadagno in November 2011. Despite Guadagno's involvement in a criminal investigation of pension abuse, Christie has not appointed a special prosecutor.

By Mark Lagerkvist
New Jersey Watchdog

New Jersey Gov. Chris Christie — a rising star in the national Republican Party — called an overhaul of the state pension system his "biggest governmental victory." He now faces embarrassment from flaws his reforms failed to fix.

The sweeping new laws increase contributions from public workers, decrease benefits and halt cost-of-living hikes. According to Christie, the changes should save the state $120 billion over the next 30 years.

But his reform did little to stop the age-old New Jersey practice of double-dipping, in which employees "retire," start collecting a pension, and then are rehired, often the next day. Christie's own deputy chief of staff collects $219,000 a year from the state — a $130,000 salary as a top aide to the governor plus $89,000 in state pension.

Worse for Christie, a criminal investigation is under way involving his running mate, New Jersey Lt. Gov. Kim Guadagno.

As a county sheriff in 2008, Guadagno made false statements to enable her chief officer to pocket nearly $85,000 a year in retirement pay while drawing an $87,500 annual salary. The double-dipping scheme first was reported by New Jersey Watchdog in 2010.

The state's investigation is assigned to the Attorney's General's Division of Criminal Justice, a unit where Guadagno once served as deputy director. Despite the apparent conflict, Christie has not appointed a special prosecutor.

A spokesman for Christie and Guadagno declined to comment. The Attorney General's Office did not respond to questions.

Pension abuses are so rampant in New Jersey that even the agency investigating Guadagno has its own controversy.

Twenty-three supervisors and investigators for the Attorney General’s Office and DCJ are using legal loopholes to draw salaries and pension pay, New Jersey Watchdog found. On average, each pockets $164,000 a year — $96,000 in salary and $68,000 in pension.

Most "retired" for just one night. Those officers left their positions with the Attorney General’s Office only to return to the same employer the next morning with new job titles — and two paychecks instead of one.

In a continuing series of investigative reports, New Jersey Watchdog exposed similar double-dipping practices involving 125 officers employed by prosecutors, 18 officials from a state Homeland Security Unit and 44 county sheriffs and undersheriffs — in addition to the Guadagno story.

Democratic State Sen. Fred Madden is a "triple-dipper" who collects more than $241,000 a year from public coffers — $49,000 as a legislator, $106,983 as a police academy dean and an $85,272 pension as a State Police retiree.

"I don't have a problem with it at all," said Madden.

The Guadagno controversy
While Madden and others profit from loopholes in pension rules, the circumstances surrounding Christie's second-in-command raise questions of fraud and deception. 

Guadagno was elected sheriff of Monmouth County in 2007. She previously worked as an assistant U.S. attorney and as an assistant New Jersey attorney general. From 1998 to 2001, Guadagno served as deputy director of the DCJ — the unit now assigned to investigate the case in which she's a major figure.

In 2008, Guadagno hired Michael Donovan Jr., a retired investigator for the county prosecutor, as the sheriff’s “chief of law enforcement division.” She announced the appointment in a memo to her staff.

Monmouth County Sheriff's Office

The focus of a criminal investigation of pension abuse, Chief Michael Donovan takes an oath of office in the Monmouth County, N.J., Sheriff's Office on Sept. 22, 2008. Donovan's job title was fudged to allow him to collect his pension and his pay at the same time. The swearing in was witnessed by his mother, Emily, and then-Sheriff Kim Guadagno, now the state's lieutenant governor. Donovan was sworn in by Judge Lawrence M. Lawson.

But there was a problem. As a sheriff's chief officer — a position covered by the pension system — Donovan would be required to stop receiving pension checks and resume contributions to the state retirement fund.

Guadagno fudged the job title, so Donovan could double-dip. In county payroll records, the oath of office and a news release, Donovan was called the sheriff's "chief warrant officer" — a low-ranking position exempt from the pension system.

A chief warrant officer oversees the service of warrants and other legal documents. In contrast, the sheriff's official website identified Donovan as "sheriff's officer chief," supervising 115 subordinate officers and 30 civilian employees.

On Guadagno’s organizational chart, Donovan was listed as chief of law enforcement — and the position of chief warrant officer was conspicuously absent.

The ruse allowed Donovan to collect an $87,500 salary from Monmouth County in addition to an $85,000 pension as a retired county employee.

A Conflicted Investigation
When Guadagno was elected as Christie's running mate in the 2009 election, she resigned as sheriff.

In 2010, state Treasury pension officials began to ask Monmouth County about retiree Donovan's employment. "I would respectfully request that former Sheriff Guadagno be contacted..." replied her successor, Shaun Golden, in a letter forwarded to the Treasury.

The Treasury denied the existence of any correspondence or email contact with Guadagno or Christie regarding Donovan. Officials also rejected requests for records of the Treasury's inquiry.

In response, New Jersey Watchdog filed a formal complaint with the state Government Records Council, a body consisting of gubernatorial appointees and cabinet officials. One year later, the council has yet to render an advisory opinion.

Meanwhile, the state Police and Firemen's Retirement System's Board of Trustees took action of its own.

"It's a double-whammy," said PFRS chairman John Sierchio. "If you're going to retire under one job title and come back under another title, we have a problem with that. The chief of sheriff is a covered title under the pension system — and they should be contributing instead of drawing out."

The PFRS board voted in May 2011 to call for a criminal investigation of Donovan and parallel instances involving John Dough, of Essex County, and Harold Gibson, of Union County. The case was referred to DCJ.

However, the investigation is riddled with a maze of potential conflicts of interest:

• DCJ is probing allegations involving its own former deputy director, Guadagno.
• Nearly two dozen DCJ investigators and supervisors are "double-dippers" who collect state paychecks and pensions.
• Attorney General Jeffrey Chiesa, a Christie appointee, is ultimately in charge of the probe of fellow cabinet member Guadagno. Chiesa is also former chief counsel to Christie.
• Despite evidence of possible wrongdoing by his lieutenant governor, Christie has not appointed a special prosecutor or authorized an independent investigation.

One year later, the PFRS board remains in the dark. "I keep asking, but we haven't been told anything," said Sierchio.

New Jersey Governor's Office

Lt. Gov. Kim Guadagno of New Jersey. When she was a county sheriff, her office fudged a job description and organizational charts to allow an aide to double-dip on his pension. Guadagno has declined to comment.

Sean Conner, a spokesman for Christie and Guadagno, refused to listen to questions about Guadagno's role or the need for a special prosecutor.

"Let me stop you right there," Conner told New Jersey Watchdog. "If it was referred to DCJ, you need to call DCJ."

The Attorney General's Office did not respond to questions about the investigation.

Back in Monmouth County, Donovan has another new job title — but he’s still a double-dipper. In February 2011, Golden named him undersheriff in charge of law enforcement — a strikingly similar position, but one apparently exempt in the labyrinth of pension rules. Donovan currently gets an $86,000 annual pension on top of his $92,000 salary.

While sheriff's chief, Donovan pocketed $227,000 in retirement checks. Since he did not re-enroll in the pension system, he avoided $18,000 in contributions to the retirement fund. If state authorities ultimately determine Donovan violated pension rules, he could be forced to repay $245,000.

Reform...except for double-dipping
Pension fraud and widespread abuse are nothing new in New Jersey.

The federal Securities and Exchange Commission accused New Jersey of pension fraud in 2010. It was the first time the SEC had taken action against a state government over public pension funds.

According to the SEC, New Jersey misled its bond investors from 2001 to 2007 by failing to disclose it had not met its obligation to fund public workers' pension funds. The lawsuit was settled with a cease-and-desist order, which the state accepted without admitting or denying the charges. The alleged fraud occurred on the watch of four previous governors.

Christie vowed to overhaul the pension system. With the state facing a $45 billion pension shortfall when he took office, the new governor spearheaded legislation that he signed into law last year.

"We are putting the people first and daring to touch the third rail of politics to bring reform to unsustainable system," stated Christie in a news release. “We are once again showing the people of New Jersey that our state is leading the way on the biggest challenges before us and remains unafraid to do what is hard, but necessary."

But the reforms did little to halt widespread double-dipping by numerous public employees, including Christie's deputy chief of staff.

Louis Goetting gets $219,000 a year from the state — $130,000 in salary as a top aide to the governor plus $89,000 in state pension payments from an early retirement deal. Christie hired Goetting in 2010 as a budget guru to help trim the cost of government.

In addition, Goetting (pronounced “getting”) received two golden parachutes from public coffers before joining Christie — severance packages of $190,000 from Brookdale Community College in 2009 and $180,000 from University of Medicine and Dentistry of New Jersey in 2002.

New Jersey Governor's Office

Gov. Chris Christie of New Jersey has touted his pension reforms, which have done little to halt the practice of double-dipping by public employees, including his deputy chief of staff.

The bottom line: Goetting has gotten more than $1.1 million in pension and severance pay — and he still draws a six-figure salary from the state.

In answer to questions about Goetting's double-dips, the governor's press office has reiterated a statement Christie issued last year: "There is no one in my administration, myself included, who understands about the operation of this government better than Lou Goetting does. And so the people of New Jersey have gotten an incredible bargain.”

Pension reforms will not be complete without an investigative staff to monitor potential abuses, according to PFRS chairman Sierchio. He noted there are 275,000 retirees — but no investigators assigned to review complaints.

"We don't have anybody watching the store," said Sierchio. "We've got an $80 billion pension system, and nobody to investigate anything. Once you get your pension, you never have to look over your shoulder."

New Jersey Watchdog is a news website devoted to public service journalism. Read more about veteran investigative reporter Mark Lagerkvist.

ANALYSIS

The judge’s ruling was written on the lawyers’ faces.  Last Friday, after Catherine Eagles denied John Edwards’s motion to dismiss the six felony charges against him at the close of the government’s case, the former Democratic senator’s lead attorney sat red-cheeked and grim.  To his right, the typically stiff lips of the federal prosecutors curled into small grins.  

While Edwards’ request to have the case thrown out for lack of evidence was a long shot, the decision highlights the ever increasing peril Edwards faces and previews what’s to come. The transcript of the argument is a worthy read for anyone whose interest in the trial is more than passing and, thanks to NBC News, it’s available here. For Edwards case followers in a hurry, here are four ways the seemingly routine motion is actually a big deal. 

Odds of Edwards going to prison just increased
When Edwards decided to contest the government’s claim that he violated the Federal Election Campaign Act (FECA) rather than reach a plea deal, his risk analysis included the hope that a judge would end the case long before jury deliberations began.  While such court-ordered judgments of acquittal are infrequent, they are not unheard of.  Indeed, in May 2011 a district court judge from the same appellate circuit (the Fourth) stopped the prosecution of a corporate lawyer on obstruction of justice charges because of the government’s failure to prove its case.  

Hampton Dellinger, a litigation partner with Robinson Bradshaw & Hinson of Charlotte and Chapel Hill, N.C., is former deputy attorney general of North Carolina and has taught election law at Duke University Law School. In 2008, he sought the Democratic nomination for lieutenant governor of North Carolina.

Edwards’ hope for a similar outcome rested primarily on the novelty of the government’s theory: never before has money from third-parties (Fred Baron and Rachel “Bunny” Mellon) to other third-parties (Andrew and Cheri Young with a smaller amount to Rielle Hunter) led to a candidate’s indictment under the FECA.  Last fall, Edwards spent hundreds of pages briefing that argument (i.e, that he had no “notice” that such an arrangement could be illegal and thus no criminal intent) plus other reasons for dismissal…and lost.   Last week, Edwards attorney, Abbe Lowell, spent 90 minutes again beseeching Eagles to end the prosecution…and lost. 

For years, Edwards the plaintiffs’ attorney fought as hard as he could to overcome opponents’ efforts for judge-directed dismissals so the outcome of his clients’ personal injury claims could be determined by a jury.  Ironically, if Edwards the defendant had known for sure that his own case would go all the way to the jury, I’m not sure he would have rejected whatever the government’s best plea deal was. 

How judge's ruling was unnerving for Edwards camp 
In the run up to his motion argument, Lowell gently expressed to Eagles his hope that she would devote the weekend or at least much of Friday to considering his arguments before ruling.  Rather than rejecting the motion after days or hours of pondering, Eagles did so in minutes.  Moreover, the judge allowed that the “closest questions in my mind have to do with some of these venue issues” (i.e., did the crimes Edwards is accused of have a sufficient connection to the district where he is being tried).  Both the speed and substance of her decision suggest that Eagles has little concern about the prosecution’s theory or the quality and quantity of evidence presented in the government’s case. 

Full trial coverage from NBC News and msnbc.com

Analysis by Hampton Dellinger

More bad news in battle over experts?
In the face of Friday’s setback, the defense doesn’t appear to be shrinking from its chief argument for dismissal: that the government has not proved and cannot prove “that Mr. Edwards acted with knowledge that his actions would violate campaign laws.” Late Friday, the defense submitted its witness list for Monday.  Appearing first: Scott Thomas, the former Federal Election Commission chairman, who is prepared to testify that the prosecution “is without precedent in federal election law and that the FEC would not support a finding that the conduct constituted a civil violation much less warranted a criminal prosecution.”  The problem for Edwards is that the government is contesting vigorously the right of Thomas to testify as an “expert witness” and Eagles on Friday suggested she thought several FEC-related issues were “pretty straightforward.”  Such phrasing is not suggestive of a judge likely to let the former FEC chair testify broadly.  But at this point, Edwards will likely consider it a win if Thomas is allowed to take the stand at all.  

Closing arguments previewed
Friday’s motion hearing made something clear and it's bad news for Edwards: Andrew Young’s story sounds better when someone else tells it.  Skilled federal prosecutor David Harbach opened his oral argument reading excerpts from Young’s most Edwards-damning testimony.  Whether presented via the prosecutor, or Young’s wife, Cheri, the former political aide’s claim that Edwards orchestrated the sex affair cover-up is more compelling when separated from Young's hazy memory and admitted misstatements.  Similarly, Harbach was able to transform the testimony of other witnesses potentially off-putting to jurors (such as the long-winded Wendy Button) into an efficient, effective litany of evidence of guilt.  While Lowell is holding his own as quarterback of the defense team, Harbach’s ability to serve as a likeable standard bearer for the prosecution’s witnesses has to be making Team Edwards nervous -- very nervous -- as closing arguments fast approach.  

The spy who helped Western intelligence agencies thwart a plot to bomb a U.S.-bound airliner was a British national of Middle Eastern origin, sources tell NBC News.

The sources, speaking on condition of anonymity, also say that British intelligence was "heavily involved" in recruiting the spy, who has not yet been identified publicly, and penetrating the plot by al-Qaida in the Arabian Peninsula to detonate a new, more sophisticated underwear bomb aboard a U.S. jetliner.

A senior U.S. counterterrorism official, also speaking on condition of anonymity, would say only that multiple friendly security services were involved in the operation. Saudi Arabia's counterterrorism operation also were involved, other U.S. officials have told NBC News.

U.S. and British officials have long reported that AQAP has wanted to recruit Muslims with Western passports to carry out attacks like the one revealed this week. As an example, the officials cited AQAP’s recruitment of Umar Farouk Abdulmutallab, who failed in the Christmas Day 2009 attempt to bring down Northwest Airlines Flight 253 over Detroit.

Related stories

Yemen Terror group may have made more underwear bombs, US officials say

Lawmakers vow investigation of bomb plot leak 

Insider who thwarted bomb plot was supposed to carry it out 

U.S. officials have said previously that the bomb -- a refined version of an “underwear bomb” used in two previous failed terror plots -- was driven out of Yemen by the insider into Saudi Arabia. It is now in the hands of U.S. bomb experts at the FBI labs in Quantico, Va., where experts have been examining it for a week, the officials said. The infiltrator also is safely out of Yemen.

The insider also provided information that allowed the U.S. to launch a Predator drone strike that killed AQAP's operations chief, Fahd al-Quso, senior U.S. officials told NBC News on Tuesday.

Evan Kohlmann, NBC counterterrorism analyst, said he found earlier reports that the spy  was a Saudi national not very credible.

“AQAP was going to give a suicide bomb to someone with a Saudi passport?” Kohlmann asked rhetorically. “AQAP has been looking for bombers with Western passports, not those who would raise suspicions.”

He noted that Abdulmutallab, who tried to detonate an earlier version of the underwear bomb aboard the Northwest flight, better  fit the profile AQAP was looking at: a young upper class college student with a Nigerian passport and a multiple-entry U.S. visa. A British national would attract even less attention, he said.

Robert Windrem is a senior investigative producer for NBC News; NBC News Justice Correspondent Pete Williams and Jonathan Dienst of WNBC-TV contributed to this report.

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By R. Jeffrey Smith
Center for Public Integrity

While politicians, insiders, and experts may be divided over how much the government should spend on the nation’s defense, there’s a surprising consensus among the public about what should be done: They want to cut spending far more deeply than either the Obama administration or the Republicans.

That’s according to the results of an innovative, new, nationwide survey by three nonprofit groups, including the Center for Public integrity. Not only does the public want deep cuts, it wants those cuts to encompass spending in virtually every military domain – air power, sea power, ground forces, nuclear weapons, and missile defenses.

According to the survey, in which respondents were told about the size of the budget as well as shown expert arguments for and against spending cuts, two-thirds of Republicans and nine in 10 Democrats supported making immediate cuts – a position at odds with the leaderships of both political parties.

The average total cut was around $103 billion, a substantial portion of the current $562 billion base defense budget, while the majority supported cutting it at least $83 billion. These amounts both exceed a threatened cut of $55 billion at the end of this year under so-called “sequestration” legislation passed in 2011, which Pentagon officials and lawmakers alike have claimed would be devastating.

“When Americans look at the amount of defense spending compared to spending on other programs, they see defense as the one that should take a substantial hit to reduce the deficit,” said Steven Kull, director of the Program for Public Consultation (PPC), and the lead developer of the survey. “Clearly the polarization that you are seeing on the floor of the Congress is not reflective of the American people.”

A broad disagreement with the Obama administration’s current spending approach– keeping the defense budget mostly level – was shared by seventy-five percent of men and 78 percent of women, all of whom instead backed immediate cuts. That view was also shared by at least 69 percent of every one of four age groups from 18 to 60 and older, although those aged 29 and below expressed much higher support, at 92 percent.

Disagreement with the Obama administration’s continued spending on the war in Afghanistan was particularly intense, with 85 percent of respondents expressing support for a statement that said in part, “it is time for the Afghan people to manage their own country and for us to bring our troops home.”  A majority of respondents backed an immediate cut, on average, of $38 billion in the war’s existing $88 billion budget, or around 43 percent.

Despite the public’s distance from Obama’s defense budget, the survey disclosed an even larger gap between majority views and proposals by House Republicans this week to add $3 billion for an extra naval destroyer, a new submarine, more missile defenses, and some weapons systems the Pentagon has proposed to cancel. Republican presidential candidate Mitt Romney has similarly endorsed a significant rise in defense spending.

When it comes to weapons, respondents on average favored at least a 27 percent cut in spending on nuclear weapons, a 23 percent cut for ground forces, a 17 percent cut for air power, and a 14 percent cut for missile defenses. Modest majorities also said they favored dumping some major individual weapons programs, including the costly F35 jet fighter, a new long-range strategic bomber, and construction of a new aircraft carrier.

“Surveyed Americans cut to considerably deeper levels than policymakers are willing to support in an election season,” said Matthew Leatherman, an analyst with the Budgeting for Foreign Affairs and Defense Project at the Stimson Center, a nonprofit research and policy analysis organization that helped develop the survey.

While Republicans generally favored smaller cuts, they overwhelmingly agreed with both independents and Democrats that current military budgets are too large. A majority of Republicans diverged only on cutting spending for special forces, missile defenses, and new ground force capabilities.

The survey, which was conducted in April, was designed differently than many polls on defense spending, which have asked respondents only if they support a cut. Its aim was instead to probe public attitudes more comprehensively, and so it supplied respondents with neutral information about how funds are currently being spent while exposing them to carefully-drafted, representative arguments made by advocates in the contemporary debate. The respondents then said what they wished to spend in key areas.

The survey’s methodology and the number of respondents – 665 people randomly selected to represent  the national population -- render its conclusions statistically reliable to within 5 percent, according to the Program on Public Consultation, which conducted it.

Somewhat surprisingly, all of the pro and con arguments about cutting defense spending attracted majority support, suggesting that respondents found many elements in the positions of each side that they considered reasonable. It also suggests that the survey fairly summarized contrasting viewpoints.

Sixty-one percent agreed, for example, with a statement that the U.S. has special defense responsibilities because it is an exceptional nation, while 72 percent said the country is “playing the role of military policeman too much.” Fifty-four percent agreed that cutting defense spending is problematic because it will cause job losses, while 81 percent – in one of the largest points of consensus – agreed with a statement that the budget had “a lot of waste” and that members of Congress regularly approve unneeded spending just to benefit their own supporters.

The survey suggested, in short, that most people do not see the issue in starkly black or white terms, but instead hold complex views about the appropriate relationship between defense spending and America’s role in the world. “Most Americans are able to hold two competing ideas in their mind and, unlike Congress, thoughtfully recognize the merits of both,” Kull explained. “And then [they] still come to hard and even bold decisions.”

The survey also showed that Americans react differently when given data on the current defense budget in different contexts – providing some insight into how partisans on each side of the debate might tailor their arguments to attract support.

When framed, for example, in the context of military spending by other countries, or the portion of the so-called annual discretionary budget devoted to defense, or the amount of money spent for defense during the Cold War, most respondents said they were surprised by how large the U.S. budget is now. But when compared to the overall size of the U.S. economy, or the size of the other two leviathans in the federal budget -- U.S. spending on Medicare or Social Security – most respondents said they were not surprised.

By far the most durable finding – even after hearing strong arguments to the contrary -- was that existing spending levels are simply too high. Respondents were asked twice, in highly different ways, to say what they thought the budget should be, and a majority supported the roughly the same answer each time: a cut of at least 11 to 13 percent (they cut on average 18 to 22 percent).

In one exercise, a larger group chose to cut the defense budget (62 percent supported this) than to cut non-defense spending (50 percent) or to raise taxes (27 percent).  They then chose to cut deeply as a means to address the deficit. In yet another exercise, respondents first read pro and con arguments for the nine major mission areas that now compose almost 90 percent  of the budget; then a majority of Republicans and Democrats then selected lower levels in eight of the nine areas.

For example, two-thirds of the respondents, including 78 percent of Democrats, 64 percent of Republicans, and 57 percent of independents, cut spending on nuclear arms. Respondents on average also sought to cut ground forces the largest dollar amount. The sole program that attracted average support for more spending was the Pentagon’s effort to development new capabilities for ground forces, but the suggested increase was slight and mostly embraced by Republicans and independents.

Majorities took these steps even though they expressed slightly higher support, on average, for statements in favor of these programs than critical of them. Most notably, they said they were convinced that air power is important (77 percent), special forces are valuable (79 percent), and missile defense efforts are worth pursuing (74 percent), while giving arguments for the Navy and ground forces less backing (69 percent and 57 percent, respectively).

While most programs got either a trim or a buzz cut in the public salon, several won outright support. A majority opposed cutting the controversial V-22 Osprey, an aircraft that takes off like a helicopter and flies like a plane. Even after being told its cancellation would save $1 billion, a clear majority backed its continued production. And even while most respondents favored killing the new strategic bomber, they solidly backed continuing to use bombers to carry nuclear arms as part of a “triad” of forces, alongside land and sea based missiles.

Whether the weight of public attitudes will be felt in Congress and the White House is unclear. As close students of Washington know, legislative outcomes here are often determined not by average views, but by the passionate convictions of noisy minorities. As a result, it’s worth noting which arguments attracted not just support from solid majorities but high rankings as “very convincing”:

• It is time to let the Afghanis fend for themselves (43 percent called this very convincing).
• There is a lot of waste in the defense budget (39 percent very convincing).
• Special forces are useful and effective (36 percent very convincing).
• We are playing the role of world policeman too much (29 percent very convincing).
• Missile defenses could help defend us (27 percent very convincing).
• Air power is critical (26 percent very convincing).
• Nuclear arms serve little purpose now (26 percent very convincing).
• Defense spending weakens other parts of the economy (25 percent very convincing).

“Americans’ views as expressed in this survey are a big reason why policymakers – after the election – are likely to tighten the Pentagon’s strategy and cut national defense spending more deeply,” said Leatherman, the Stimson Center analyst.

December 2011 was a busy month for supporters of presidential candidate Newt Gingrich. The former speaker of the House had surged ahead of his Republican rivals in several polls. Suddenly he was being barraged by negative TV ads produced by Restore Our Future, a Super PAC for rival candidate Mitt Romney.

Gingrich did not have the money to retaliate. Individual donations in federal elections are restricted to $2,500. He needed his own Super PAC that could receive unlimited contributions.

Ever since the Supreme Court's 2010 decision in the Citizens United case paved the way for Super PACS, they have been a legitimate new tactic for political campaigns. As far as can be determined, Winning Our Future (WOF), the pro-Gingrich political action committee, did not do anything impermissible under campaign finance laws. But a look at its regular reports to the Federal Election Commission reveals a degree of legerdemain that appears commonplace in FEC records and makes it difficult for the public to know who ends up with the record amounts of money flowing into the political system today.

"Opaque transactions in politics undermine public confidence in the process," said Meredith McGeehee, owner of McGehee Strategies, which works on public interest advocacy, and policy director at the Campaign Legal Center.

Flying under the radar

Because Super PACs are required to operate independently of the candidates they support, three longtime Gingrich allies scrambled to assemble one on his behalf. Winning Our Future filed papers with the Federal Election Commission on December 13, 2011. Texas billionaire Harold Simmons seeded it with $500,000 and gave twice more, for a total of $1.1 million. The family of casino mogul Sheldon Adelson donated $21.5 million. By the end of March 2012, WOF had raised an additional $1.2 million, for a war chest of $23.8 million.

Who received that money is difficult to discern.

Within six weeks of the Super PAC's launch, three new companies were set up to serve as vendors for WOF. (A fourth had been formed earlier in 2011, after Gingrich declared his candidacy in May, by an individual behind one of the three later outfits.) These four new companies received 84 percent of WOF's total disbursements, according to FEC records.

Some political consultants said they set up separate companies for different races for accounting purposes or to create a kind of firewall between their political work and their commercial activities. Others said the maneuver can be used to conceal work being done simultaneously for rival camps. And it can have tactical advantages.

"A new entity means they can fly under the radar for a few minutes," said one source. "Theoretically, it slows down the opposition research on their buying style." Where a candidate chooses to advertise says a lot about the issues and voters he or she is targeting.

The key word is "buying." The biggest checks written by any campaign or Super PAC go to the companies that buy ads on TV, radio and the Internet. Under long-standing industry practice, the broadcaster gives the buyer a 15 percent discount that the buyer has kept as a commission. These days, the percentage kept by political media buyers is likely to be 5 percent or less, according to various industry insiders. The rest of the discount from the broadcasters may be apportioned any way the leaders of the PAC or campaign wish.

PACs are required to report expenditures, including recipient and amount. Bulk checks to media buyers routinely run into the millions of dollars without disclosing subcontracts and other expenses. Side agreements over splitting of the discounts from the broadcasters are not subject to FEC disclosure.

"Our system is based on the idea that (Super PACs) can basically spend money however they see fit, and if your donors think the committee is not spending it wisely, then they can decide not to give further," said FEC Commissioner Cynthia Bauerly.

Compensation mystery

Rick Tyler is a seasoned political operative who began advising Winning Our Future in December. He described in the harshest terms what he says is the common industry practice of PAC staff secretly divvying up portions of the discount: "Kickbacks … come back either to the campaign or the media vendor, in many cases the campaign manager. So you'll get a congressional campaign manager who on the surface you think is making $50,000-$60,000. The fact is he could be making hundreds of thousands of dollars - you have no idea because he's being paid separate from what you're seeing."

Total broadcast and cable spending during the 2012 race is projected to be $3 billion. That means as much as $450 million could be divvied up among political consultants and campaign or PAC staff according to negotiated fee agreements and informal side deals.

Tyler disparaged this opaque system of fee sharing as a hallmark of big-name political consultants. He didn't name any specifically, but he says WOF avoided their help. Yet it's clear that some of the pro-Gingrich Super PAC's vendors engaged in some opacity.

WOF's TV ad buys were handled by Media Advantage, which was incorporated in Baton Rouge, Louisiana, on December 6, 2011 - a week before WOF submitted its organizing statement to the FEC. The owner was listed as Laura Lancaster, of Baton Rouge, who did not return phone calls from Reuters.

The real buyer, according to Tyler, was Ken Kurson, a partner and executive vice president of Jamestown Associates in Princeton, New Jersey. Neither Kurson nor Jamestown CEO Larry Weitzner would comment for this story.

Tyler said that when WOF first approached Kurson, Jamestown said it had a conflict: It was already handling TV ads for the pro-Rick Perry Super PAC Make Us Great Again.

While media buyers have no obligation to avoid such conflicts the way law firms or investment banks do, they prefer not to advertise them. Commercial clients may not want to be linked to certain politicians, and political clients may worry about leaks inside the organization.

Political vendors sometimes work for rival campaigns because there are more candidates than companies that can execute a good national media-buying strategy, according to industry experts. To avoid disclosing their identity in FEC records and to avoid leaks within the organization, one prominent media consultant explained, they spin off a separate corporation. How separate is another matter.

Jamestown Associates "just told Ken it would be fine to set up his own company," Tyler said in explaining why Kurson established Media Advantage in December.

Kurson was behind another mysterious WOF vendor, according to Tyler. Empire Creative is shown in FEC reports as receiving $195,875 to produce ads. This company was incorporated in Delaware on October 31, 2011, by National Registered Agents Inc. An official with National Registered Agents said the company has an agreement with its customers to keep their identities confidential. The incorporation documents reveal nothing beyond a post office box number in New York City.

Spotty records

The name of Sam Hassell does not appear on any FEC reports from Winning Our Future, but Reuters discovered that he received the largest chunk of money from the Super PAC. Payments totaling more than $8.1 million were made to his two companies. He created Marketel Media Inc five months before WOF was formed and Intelimarc Inc just nine days before.

Although Hassell is the sole stakeholder in Intelimarc, his name is not on its incorporation documents. Two local attorneys are cited instead. Because December was so hectic, said Hassell, he had his brother's law firm do the work. WOF paid Intelimarc $1.2 million for Internet and email advertising, according to FEC records.

In recent years, Hassell sold radio ads for Salem Radio Network, a national network of stations that feature Christian music and conservative talk show hosts. He left in May 2011 to become chief executive officer of one of its clients, the Association of Mature American Citizens (AMAC), a for-profit company that offers members discounts on various goods and services. When Hassell incorporated Marketel in July, AMAC was its only client. WOF is now a second.

WOF bought $1.9 million in radio air time, according to Smart Media Group, a political advertising company in Alexandria, Virginia, that monitors political ads on TV, radio and cable outlets. According to its reports to the FEC, WOF paid Marketel at least $2.9 million solely for radio advertising.

That leaves $1 million - a third of the disbursements - that didn't show up as buys.

Hassell couldn't explain the gap or say how much his companies profited. He did say they took the "industry standard" of something less than 15 percent in commissions for the placing of radio ads.

Explanations for the gap could include Smart Media's missing some air-time purchases by Winning Our Future. Some of the expenditures listed in the Super PAC's reports to the FEC might have included money spent on something else, such as producing the ads. (Winning Our Future reported separate outlays for ad production.)

From the FEC records alone, however, it's hard to know where much of the $8.1 million paid to Hassell's two new companies ended up.

"You have to have people you can trust"

Rebecca Burkett came to Winning Our Future from American Solutions, a nonprofit political group run by Gingrich that largely closed down when he became a candidate. The Super PAC paid her $249,505 between December and March for fundraising and management consulting. In all, Winning Our Future paid out $217,834 for fundraising, although only $1.2 million was raised beyond amounts contributed by Simmons and the Adelson family.

A vendor listed as VHH Consulting LLC turned out to belong to the wife of Lee Habeeb, who helped build up the roster of popular conservative radio hosts at Salem Radio and has had a long association with Gingrich. He also helped WOF get organized in December, including providing advice about how to handle the radio and Internet advertising eventually contracted to Hassell's two companies. Habeeb and his wife, Valerie, have consulting companies in their hometown of Oxford, Mississippi - LMH Consulting LLC for him, VHH for her. VHH received $59,235 from Winning Our Future for consulting "on strategy and branding and the ways to go about putting the ads together," she said.

Why so many longtime Gingrich associates got business from Winning Our Future is no mystery, she said: "You have to have people that you trust. You need to know who you're dealing with."

Scams waiting to happen

Meredith McGeehee points to another tie that binds: "Any politician has a retinue of people that over time they build up, and if you're one of those consultants, one of those who provides services to those candidates, it's a great business. You can make a good living growing all the different services to the candidate or to the Super PAC."

But the complex web of shell companies effectively thwarts the transparency the Supreme Court took for granted in Citizens United, and scams or self-dealing would be difficult to detect.

"It's very hard to keep track of that and have accountability," said McGeehee.

Where she sees danger in the advent of Super PACs, Lee Habeeb sees opportunity.

"(The) Super PAC is constitutional, so it's with us for a while," he said. "To the talented will go some real spoils."

Just days before the news broke about the CIA's takedown of a plot involving a sophisticated new underwear bomb, al-Qaida’s affiliate in Yemen publicly boasted that it had vastly expanded and improved its capabilities for making such devices.

That boast -- contained in a largely overlooked passage of Inspire, the online propaganda organ of al-Qaida in the Arabian Peninsula (AQAP) -- has fueled concerns that there may be other versions of the seized device and more bomb makers assembling them, according to U.S. security officials and members of Congress who have been briefed on the case.

One hint at the expansion of AQAP's bomb-making capabilities can be found in passages in an article entitled "Wining on the Ground," found on the 57th page of the latest 59-page edition of Inspire, released by AQAP last weekend.

In 2009, AQAP had only a "very modest and small laboratory in a rural area" to make bombs, the author of the article –identified as Yahya Ibrahim -- wrote.

That was the year AQAP dispatched a suicide bomber to use a chemical underwear bomb to attempt to assassinate Prince Mohammed bin Nayef bin Abdul Azizbin, director of Saudi Arabia’s counterterrorism program, and later deployed another operative from Nigeria to try to blow up a U.S. airliner bound for Detroit. Neither device detonated properly, though the bomber in the first attack was killed.

But now, after obtaining “a large deal of chemicals from military laboratories" in a key city in southern Yemen -- "the modest lab has transformed into a modern one," the Inspire article stated.

"Hence, no wearisome measures are taken anymore to obtain the needed large amount of chemicals for explosives," it said. "Also, the operations now do not lack money as before." 

Related stories 

Lawmakers vow investigation of bomb plot leak 

Insider who thwarted bomb plot was supposed to carry it out 

This was not the first time AQAP has signaled that its bomb-making capabilities may be greater than U.S. officials have suggested.

In an issue of Inspire in late 2010, the group appeared to mock comments by U.S. officials focusing on the critical role of its top bomb-maker, Ibrahim Hassan Asiri -- who has been widely credited with designing the underwear bombs.

"Isn't it funny how America thinks AQAP has only one major bomb maker?" an article stated. 

Gregory Johnsen, a highly respected Yemen scholar who specializes in AQAP at Princeton University, said the propaganda outlet’s statements are likely true.

"We have to assume that there is not only one bomb-maker," he said. "It makes sense that he (Asiri) is somebody who has taught others" about making such bombs.

Johnsen said that the expansion of AQAP's bomb-making operations would be just one example of the dramatic gains the group has made in the past few years. As a result of the internal chaos in Yemen, and its shrewd exploitation of civilian casualties caused by U.S. air strikes, AQAP has made major advances, Johnsen said.

By U.S. intelligence estimates, the number of AQAP fighters has tripled to more than 1,000. It has also seized swaths of territory in southern Yemen, where it runs its own court system, deploys police officers and provides electricity to some towns, Johnsen said.

U.S. intelligence officials say they have no specific information indicating that other improvised explosive devices (IEDs) similar to the one that was turned over by a CIA informant last month have been produced and possibly spirited out of Yemen.

But John Brennan, President Barack Obama's chief counterterrorism adviser, said Tuesday in an interview with PBS that U.S. officials are taking additional measures "to prevent any other type of IED similarly constructed from getting through security procedures."

At the same time, the U.S. Department of Homeland Security issued new "guidance" calling for enhanced security at foreign airports, including additional pat-downs and random searches, as well as other steps aimed at detecting such bombs.

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Penguin Group (USA)

The book jacket of Jonah Goldberg's "The Tyranny of Clichés: How Liberals Cheat in the War of Ideas" describes him as twice nominated for a Pulitzer Prize. The publisher said Tuesday it would remove the claim. He was one of thousands of entrants, not a nominated finalist.

On the dust jacket of his new book, "The Tyranny of Clichés: How Liberals Cheat in the War of Ideas," best-selling conservative author and commentator Jonah Goldberg is described as having "twice been nominated for a Pulitzer Prize."

In fact, as Goldberg acknowledged on Tuesday, he has never been a Pulitzer nominee, but is merely one of thousands of entrants.

When this bit of résumé inflation was pointed out by a reporter for msnbc.com, Goldberg said he hadn't meant to mislead anyone and removed the Pulitzer claim from his bio at National Review Online. (Here's the page before and now.) And he added, "I never put it in the bio in the first place."

His publisher, Penguin Group (USA), said the error was unintentional and it would remove the Pulitzer word from his book jacket when it's time for the first reprint, "just like any other innocent mistake brought to our attention." (Update: On Wednesday morning, the  publisher removed the claim from its own website.)

What's surprising in Goldberg's case is that he has been called out for the same résumé padding before, when his previous book was published.

Goldberg's "The Tyranny of Clichés" was published May 1 and is ranked in the top 100 in sales on Amazon. A fellow at the American Enterprise Institute, Goldberg is the founding editor of National Review Online. He is a Fox News contributor, and has appeared as a guest on MSNBC and NBC. (Msnbc.com is a joint venture of NBCUniversal and Microsoft.)

An entry form and $50
It's not uncommon for Pulitzer entrants to claim to be nominees. Here's how it works: Though there are only three nominees, known as nominated finalists, in each Pulitzer category each year, there are more than 2,000 entrants. One could say that all of them were "nominated" by someone. If all Pulitzer entrants could be called nominees, any publisher could give all its authors that honorific by submitting an entry form and a check for $50.

The Pulitzer rules make clear that the only people to be known as nominees are those finalists chosen by the Pulitzer juries. From those nominated finalists, the Pulitzer board chooses the winners. Everyone else is just an entrant. As the Pulitzer board's online list of frequently asked questions explains politely, "Work that has been submitted for Prize consideration but not chosen as either a nominated finalist or a winner is termed an entry or submission. ... We discourage someone saying he or she was 'nominated' for a Pulitzer simply because an entry was sent to us."

Besides violating the official rules, such claims mislead the public. Tell readers that you're an Academy Awards nominee, and they'll understand that you're one of the few finalists, not one of the many entrants submitted by movie studios. It's exactly the same with the Pulitzers.

And in addition to misleading the public, such false claims rob honor from the actual nominees. This year's non-winning nominees include journalists and authors revealing failure to enforce safety standards at aging nuclear power plants, exploring the heartache of dealing with a sick spouse, and capturing in photographs the chaos and exuberance of the Arab Spring.

Being a "two-time Pulitzer Prize entrant" won't sell many books. Claims to Pulitzer nominations have showed up in the bios of well-known sportswriters Bill Plaschke and Buster Olney, NPR host Michele Norris and others not listed on the Pulitzer site among the nominees, including a good number of university professors.

(See below for a version of Where's Waldo: Find your own Pulitzer fakers by comparing Wikipedia bios with the list of nominees for recent years on the Pulitzer Prizes website.)

'I don't recall'
When Goldberg's "Liberal Fascism" came out in January 2008, his employer National Review Online announced that Tribune Media Services, which carries Goldberg's opinion columns, had "nominated" Goldberg for a Pulitzer in commentary.

The liberal blog Daily Kos then pointed out that the Tribune doesn't choose Pulitzer nominees, writing about "Goldberg's faux Pulitzer."

Commenters on Amazon took up the baton, attaching to Goldberg's Amazon profile several lengthy notes pointing out the puffery. The book sold well, reaching No. 1 on the New York Times hardcover list in March 2008.

A cartoon circulated mocking Goldberg for the claim. The punch line has Goldberg saying, as he opens a sweepstakes envelope, "I was just informed I might be winning ten million dollars." Here's a link to the online cartoon, by August J. Pollak, who draws "Some Guy With a Website."

After the hubbub, Goldberg's speaker's bureau removed the Pulitzer claim from his online bio, as documented by Daily Kos.

Goldberg told msnbc.com on Tuesday that he didn't recall any of this. "In all honesty, I don't recall ever being 'called' on this."

When contacted on Tuesday by email, Goldberg replied at first, "Nominated by the Tribune syndicate. Never said I was a finalist. There's a distinction."

When told that he's not a nominee either, and isn't listed among the nominees on the Pulitzer website, Goldberg replied, "I'll check it out and have 'em remove it if you're right. Happily. If it's not kosher, I shouldn't have it in there. Period."

Two hours later, after appearing on a radio show about the Tuesday primary voting, Goldberg sent a longer answer in email, but insisted that it be off the record. He was asked to provide a comment on the record, but declined.

'Just like any other innocent mistake'
Then, later Tuesday, his publisher issued a strong defense of Goldberg's integrity. Adrian Zackheim, president and publisher of Sentinel, an imprint of Penguin Group (USA), sent over this statement:

Penguin Group (USA)

The cover of Jonah Goldberg's "The Tyranny of Clichés: How Liberals Cheat in the War of Ideas."

"There's no conspiracy here, just an innocent mistake at worst. In casual conversation, whenever a news organization submits one of their writers for a prize, people say that person was nominated. By that standard Jonah Goldberg 'has twice been nominated for a Pulitzer Prize.' You've brought it to our attention that the Pulitzer authorities don't approve of that usage, and that technically Jonah was 'entered' but not 'nominated.'

"We appreciate the notice, and we will treat it just like any other innocent mistake brought to our attention, such as a misspelled name or factual error. Specifically, Sentinel will correct the reference on future printings of The Tyranny of Clichés, and we will submit the correction to online retailers like Amazon and Barnesandnoble.com, which use our flap copy for their descriptive copy. Jonah is also correcting any other bios that have the error.

"However, it would be completely inaccurate for you to conclude that there was any intent to inflate Jonah's credentials or deceive anyone. His credentials are extremely impressive already and don't require any extra hype."

Attached to the publisher's statement was an internal note from the Penguin publicist, cautioning author Goldberg not to say another word.

And there was a note from Goldberg himself to the publisher, an internal email forwarded by mistake: "I think it's great," Goldberg said, apparently referring to Zackheim's statement. "It's a bull@!$%# story and I think this walks the line between acting in good faith and making that clear."

Goldberg, 43, is a son of literary agent Lucianne Goldberg, who became known after she advised Linda Tripp to secretly tape record Monica Lewinsky's conversations about sex with President Bill Clinton. She now has her own website, Lucianne.com. Jonah Goldberg got his start as an aide to commentator Ben J. Wattenberg at the American Enterprise Institute. Goldberg's columns are syndicated to newspapers nationally. For $2,000 to $7,500 per person, one can accompany the "Pulitzer-nominated columnist" and others from the National Review on a cruise to the Bahamas and Grand Cayman. His many liberal targets have included former Vice President Al Gore, whom he derided as a "serial exaggerator."

Find your own non-nominee nominees
Readers, here's a link to people whose Wikipedia biographies contain the word "Pulitzer" and "nominee" or "nominated."

Which ones aren't real nominees?

Here's a search form for actual winners and nominated finalists at the Pulitzer Prizes site.

It can be tricky to tell who's fibbing. A group of newspaper reporters, even an entire staff of a newspaper, could be nominated finalists in a category, without being named individually on the Pulitzer site. And nominees have been announced only since 1980.

The key questions to be put to a claimant are these: In what year were you a Pulitzer Prize nominee, and in what category? 

N.B. A couple of readers asked how this story got started, whether I was tipped off by some political opponent of Goldberg's. No, I was looking at the Amazon list of top-selling books, and wasn't sure if I recognized Goldberg's name. I clicked through, and saw his bio. As soon as I saw in the bio that he was a two-time Pulitzer nominee, I doubted it. -- Bill Dedman

Two congressional leaders vowed Tuesday to investigate how word of a successful operation to foil a bomb plot by a Yemen-based al-Qaida affiliate leaked to reporters for the Associated Press. 

“This leak could have been … devastating and still could have significant long term damage,” Rep. Peter King, R-N.Y., chairman of the House Homeland Security Committee, said after a closed door briefing on the operation. “I believe it's absolutely essential a full investigation is carried out as to who was responsible for this leak. 

“I can't emphasize how closed this was, how compartmentalized it was, and how secret it was, and yet the fact that it could have gotten out in any kind of detail at all, … that even a hint of it could have gotten out, is really, really shocking.”

“When you have a leak it could cost American lives, your allies’ lives,” he told reporters at the Capitol. “It also deters people from giving information. So, it's very important that we make sure that we have a sensitive investigation, it has to be a classified, need-to-know type of situation.” 

The Associated Press broke the story Monday of the foiled plot by members of al-Qaida in the Arabian Peninsula to detonate on a U.S.-bound airliner a refined version of an “underwear bomb” used in two previous failed terror plots. 

Insider thwarted underwear bomb plot, triggered drone strike, US officials say

The news service said it had learned about the plot last week but agreed to White House and CIA requests not to publish a story immediately because the sensitive intelligence operation was still under way. Once officials said those concerns were allayed, the AP said it decided to disclose the plot Monday despite requests from the Obama administration to wait for an official announcement Tuesday. 

If word of the operation had leaked out prior to the weekend, it could have disrupted an attack in Yemen by a U.S. Predator drone that U.S. officials say killed Fahd al-Quso, whom they described as director of external operations at AQAP, who was “involved (in the bomb plot) in an intimate fashion.”

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Updated at 8:01 a.m. ET -- An insider who worked with the United States and an allied security service to thwart an al-Qaida bomb plot hatched in Yemen was the man picked to carry out the suicide attack on a U.S.-bound airliner, U.S. and Yemeni officials tell NBC News.

An unidentified Yemeni  government official, speaking on condition of anonymity, said the supposed suicide bomber was working for Western intelligence “from day one.”

The insider also provided information that allowed the U.S. to launch a Predator drone strike that killed the group’s operations chief, senior U.S. officials told NBC News earlier Tuesday.

“The device never got near an airplane. To our knowledge, it never got near an airplane or airport.”

The bomb -- a refined version of an “underwear bomb” used in two previous failed terror plots -- was driven out of Yemen by the insider into Saudi Arabia. It is now in the hands of U.S. bomb experts at the FBI labs in Quantico, Va., where experts have been examining it for a week, the officials said. The infiltrator also is safely out of Yemen.

The officials also said that a successful Predator attack that killed Fahd al-Quso over the weekend was related to the plot and was a “part of a 1-2 blow against Al-Qaida in the Arabian Peninsula (AQAP),” the north African affiliate of the al-Qaida terrorist network.  Al Quso, described as director of external operations at AQAP, was “involved (in the bomb plot) in an intimate fashion,” said the senior administration official. 

The officials declined to identify the allied security service involved in penetrating the plot, but multiple U.S. sources told NBC News that British intelligence was "heavily involved" in shutting down the plot. Separately, a senior U.S. counterterrorism official said that multiple friendly security services were involved in the operation. 

The plot, which U.S. officials described Monday as a plan to detonate aboard a U.S.-bound jetliner a refined version of the “underwear bomb” that failed to blow up a Detroit-bound airliner on Christmas Day 2009. That device, worn by convicted bomber Umar Farouk Abdulmutallab, did not detonate.

The bomb aboard Northwest Flight 253 was the second failure of such a device. Four months prior, a suicide bomber attempted to kill Prince Mohammed bin Nayef bin Abdul Azizbin, director of Saudi Arabia’s counterterrorism program, at his palace in Jeddah. The bomber died in the attack, but the prince only suffered burns to one hand.

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The new bomb had a more refined detonation mechanism and was "totally non-metallic," which officials told NBC News would have made it more difficult to detect by traditional security screening processes.

The senior administration official would not comment on whether the would-be bomber, who is believed to be a Yemeni national, was in custody, but did say, “We do not believe the intended user of the device poses a threat."

The official also disputed reports indicating that al-Qaida in the Arabian Peninsula sought to detonate the bomb around the anniversary of al-Qaida founder Osama bin Laden’s death, saying, “They hoped it would be carried out this month, but (there is) nothing from our insight that it was to coincide with anniversary or in retaliation for OBL’s death.”

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The book "Most Wanted" was published Tuesday.

We have an excerpt from a book published Tuesday about the hunt for a Boston organized crime boss, "Most Wanted: Pursuing Whitey Bulger, the Murderous Mob Chief the FBI Secretly Protected," by Thomas J. Foley, Col. [Ret.], Massachusetts State Police, and John Sedgwick.

"Most Wanted" is the account of the former head of the Massachusetts State Police, Thomas J. Foley, and his 20-year pursuit of murderous Boston gangster Whitey Bulger, and of Foley's role in exposing the FBI's protection of Bulger's criminal empire. 

James "Whitey" Bulger led the Winter Hill Gang, an Irish American crime family based in South Boston from around 1979 to 1994. He was often hailed as a local hero and modern day Robin Hood, dedicated to protecting the neighborhood and its residents. But he was a hardened criminal who created an empire based on extortion and intimidation and murdered over fifty people. On June 23, 2011, Whitey Bulger, No. 1 on the FBI's Most Wanted list, was arrested after sixteen years on the run.  The Whitey Bulger trial is scheduled to begin November 5, 2012.

An excerpt from Chapter 2 of "Most Wanted":

At Christmas in 1991, we were about a year into the Bulger investigation.  I was with a few guys from my team at Joe Tecce’s, the big, splashy restaurant in the North End.  Big John Tutungian, Sly Scanlan, our hookup guy Chuck Hanko and a few others.  It was the annual Christmas party of the Boston office of the FBI for a lot of law enforcement people around New England.

FBI special agent John Connolly, one of the bigger showboats, always played the host.   Remember, this was when the local FBI and State Police were supposedly working night and day to get Whitey Bulger arrested and sent away.  Guess where the booze came from?  A liquor store called the Rotary Variety in South Boston that was owned by Whitey Bulger himself.  That was the rumor back then, that Connolly picked it up there himself, and it turned out to be the truth: We were drinking Whitey’s booze.

My guys were bothered by the idea, needless to say.  We drank, sure, but the beer did not go down easy.  But, starting with Connolly, a lot of FBI agents seemed to think it was a matter for a few jokes, some hearty claps on the back, and maybe another round on Whitey.

The U.S. Attorney’s Office in Boston also had some law enforcement people in from around New England for a little get-together from time to time.  A bunch of FBI agents swung by for one of them that year, 1991, and some “Staties,” including me.  By then, we’d started to make some serious progress on the Bulger investigation, and I was feeling good about how things were coming along.  A couple of agents clanged beer bottles together and yelled for quiet and then they announced they wanted to make a presentation.  They did it up big, asked all to crowd around, and got all solemn.  When everyone was quiet, one of the FBI agents called out:  “Everyone, this is a very special occasion for all of us here, and we’d like to present an award to a distinguished trooper from the State Police.   Would Corporal Tom Foley please step forward?”

There was a little too much tittering in the crowd.   My friend Fred Wyshak, the assistant United States Attorney, had been given an “award” from the feds just the year before, and he didn’t appreciate his very much.  So I stayed right where I was.

“Tom Foley, please?” one of them repeated.  .

By now, the room was dead silent.   I still didn’t move, so the feds came toward me, and drew many of the attendees, many of them my superiors in the State Police, in a ring around us.   One of the agents made a little unfunny speech about my investigative zeal in the Bulger case.  That got some laughs, but not many.

Then the two agents handed me my award, which was wrapped up in tissue paper.  “Go ahead, Tom, open it up,” one of them told me.

I pulled the tissue paper away, and scanned the plaque.  It read: “THE MOST HATED MAN IN LAW ENFORCEMENT.”  It had a picture of me with my name underneath.

They wanted me to read it out to the crowd, but no way.  So one of them did the honors, while I just glared at him.

The FBI agents in the crowd got a chuckle out of it, but not too many other people did, and I certainly didn’t.  Still, the agents shook my hand, looked me dead in the eye, and said, “Congratulations, Trooper, you’ve earned it.”

I still have that trophy someplace, and whenever I want to remember what it was really like to work that case, I take it down and look at it.  Then everything comes rushing back.

The most hated man in law enforcement.  I’m proud of that, prouder of that than I have been of any other award I have ever received.  This book is about how I earned that honor.  It’s the story of my twenty year quest to bring Whitey Bulger to justice when hardly anyone outside my little band of overworked state police investigators like Tutungian, Scanlan, and Hanko, and a dogged agent from the DEA named Dan Doherty and a few others who came later, gave a @!$%#, quite frankly, and the FBI did about everything in its power to stop us.

In 1990, when our investigation kicked in, Whitey Bulger was by far the most dominant figure in the Irish mob.  The Mafia had started to flame out, leaving the Irish mob about the only mob of any impact in Boston.  Steve Flemmi, or Steve “The Rifleman” Flemmi as the newspapers always put it (so named for his lethal shooting skills as a paratrooper during the Korean War), came in second to Whitey, Flemmi was up there largely because he was tight with Bulger; Whitey would have ranked regardless.   Still, Flemmi was the only mobster Whitey trusted, had ever trusted, or even spoke to on any kind of regular basis.  Third was probably “Cadillac Frank” Salemme, so named for his favorite car, who had recently emerged from prison to claim control of what was left of the New England Mafia.  He’d relied on Flemmi for help in getting established, which meant that he was drawing on Whitey’s reputation, too.  In the Boston mob scene, Whitey had all the power—others simply borrowed it.  But all three of these men were woven in tightly to our case.

By 1990, Bulger was sitting on a criminal empire the newspapers pegged at $50 million.   It came from his marijuana smuggling, cocaine dealing, extortion, illegal liquor distribution, pilferage, racketeering, gaming, and loansharking, but he’d do about anything if enough money was on the table.  Although he was rarely seen around town, even in South Boston, his presence was everywhere.  If there was a crime anywhere in the city that involved scaring the crap out of someone, it was probably Whitey’s doing.  If there was a legitimate business to be muscled in on, Whitey again.  If someone needed to be made an example of, Whitey.

Whitey was just plain smarter than the other mobsters, better connected, with keener instincts.  But most important of all he was utterly ruthless.  More than most gangsters, Whitey could always think several steps ahead, sure.  But it was his ability to scare the @!$%# out of people that made the difference.  Terror was his business.  It wasn’t just killing people.  All mobsters killed people.  By now, Whitey’s official tally is up to nineteen, but the real count is probably twice that, if you add up all the virtual unknowns from the gangland wars earlier on when he was making a name for himself as a killer.  Those victims weren’t widely missed after their bodies dropped into the trunk of a car, or dumped in some alley.  But more than the numbers, it was the way he killed, at extremely close range, the tip of the gun right up in the soon-to-be dead’s face, so that last thing they saw on this earth was Whitey Bulger hovering over them, relishing it, before he blew them away, the blood splattering on him, as if that brought him the greatest satisfaction there was.  People who were there told us that Whitey liked to lie down afterward, and a weird calm would descend over him.  “Like he’d taken a Valium,” one of them said.  And the whole scene was so grotesque, so horrible, he knew that word would get out about what he’d done, and that would be good for him too.  Do that enough, and you have to do it less.  Whitey Bulger has to be the most cold-blooded killer in Boston’s history.  If he isn’t, I wouldn’t want to know the guy who is.

None of this was a big secret in Boston.  Most people knew the basics of what Whitey was about.    But, until we came along, no one in law enforcement had been able to do what law enforcement is supposed to do—namely get a bastard like that off the street before he kills somebody else.  Whitey had been at large since 1965, when he emerged from his only prison stint, served mostly in Leavenworth and Alcatraz for a string of bank robberies, the last one in the Midwest.  Since then, he hadn’t been touched by law enforcement.  Never questioned, never indicted, never arrested.  Not once.  It was like Whitey Bulger was a model citizen.

To the FBI, it was like Bulger didn’t matter.  Despite his fearsome reputation, he had nothing to do with anything.  Well, we thought differently. There are plenty of things to say about the FBI, but I’ll save most of them for later.  For now, I’ll just say that I have never known any organization, or any individual, where what they said, and what they did, had so little to do with each other.  But the funny part is, the FBI thinks that’s fine, even now.  Since I got that Most Hated award, federal judges, Congressional Committees, and countless newspaper accounts have all agreed that the FBI’s problems go very deep.  They did here.  The feds stymied our investigation of Whitey, got us investigated on bogus claims, tried to push me off the case, got me banished to a distant barracks, phonied up charges against other members of the State Police, lied to reporters, misled Congress, drew in the President of the United States to save themselves, nearly got me and my investigators killed, and—well, I’ll tell you and.

The Most Hated Man in Law Enforcement, indeed.

---

This is an excerpt from "Most Wanted: Pursuing Whitey Bulger, the Murderous Mob Chief the FBI Secretly Protected," by Thomas J. Foley, Col. [Ret.], Massachusetts State Police, and John Sedgwick. Printed courtesy of Touchstone, an imprint of Simon & Schuster.

About the authors
In 2004, Thomas J. Foley was awarded the United States Attorney General’s Award for Exceptional Service for his role in the Whitey Bulger/John Connolly investigation. A career officer with the Massachusetts State Police, Col. Thomas J. Foley rose to become its highest ranking officer in 2001. Since retiring in 2004, Foley teaches criminology at the University of New Hampshire.

John Sedgwick is the author of ten books, including two celebrated novels and the family memoir In My Blood. A longtime contributor to GQ, Newsweek, and the Atlantic, he wrote the first national expose of the exploits of Whitey Bulger in GQ in 1992.

Brown Harris Stevens

The view from Apartment 8W at 907 Fifth Avenue, a view that Huguette Clark gave up for the last 20 years of her life. The 5,000-square-foot apartment could still be yours for $19 million.

NEW YORK — The prime minister of the Persian Gulf nation of Qatar was rebuffed this weekend in his attempt to spend $31.5 million for two of the New York co-op apartments of the reclusive heiress Huguette Clark.

A person familiar with the decision said the co-op's board declined to grant the sheikh an interview, concerned primarily that the quiet character of the elegant building would change with the security demands of a foreign leader. He would be replacing, after all, a woman who was the world's quietest neighbor, having lived the last 20 years of her life in New York hospitals.

Huguette Marcelle Clark, the heir to a Montana copper fortune, has been the subject of a series of reports on msnbc.com about her vacant properties and the management of her fortune. When she died last May at age 104, her properties included three apartments at 907 Fifth Avenue, at East 72nd Street, overlooking Central Park's Conservatory Water, near the statute of Alice in Wonderland.

Karim Jaafar / AFP-Getty Images

The prime minister and foreign minister of Qatar, Sheikh Hamad bin Jassim bin Jaber Al Thani, photographed in 2006. He was rebuffed in his effort to buy the New York apartments of the late reclusive heiress Huguette Clark.

The Qatari prime minister, Sheikh Hamad bin Jassim bin Jaber Al Thani, was selected by the Clark estate after an auction, offering $31.5 million for Clark's two apartments on the 8th floor, a total of 10,000 square feet. That's half a million dollars more than the asking price. Hamad, who reportedly has two wives and 15 children, owns one of the largest yachts in the world, the 133-meter al-Miqab, which cost several hundred million dollars.

Clark's third apartment, on the top floor, the 12th, found a buyer soon after it was listed, at or near the asking price of $24 million. The buyer is Boaz Weinstein, the well-known hedge fund manager and derivatives trader, formerly of Deutsche Bank and now with Saba Capital Management LP. He has signed a contract and is awaiting an interview with the co-op board.

The three apartments combined cost Clark (and her estate) $28,500 a month in co-op fees, or $342,000 a year.

But the auction became moot after the co-op's board changed its mind, deciding not to allow the two apartments on the 8th floor to be joined into one. Even though the apartments had been listed separately, the estate had accepted bids only for the two together, after the co-op board had signaled that it would look favorably on a combination. But the board changed its mind after the auction, and the board declined to grant an interview to the Qatari, even if he were to purchase only one of the two apartments. Besides the security issues, the board was concerned about the disruption of construction, as well as the long-term imbalance of having a single owner with so large a share of the building. The Qatari had also let it be known that he was willing to pay top dollar for other apartments in the building for staff and relatives.

Hamad is not only the prime minister but also the foreign minister of the emirate, and is the cousin of the emir, the country's hereditary ruling leader, Sheikh Hamad bin Khalifa Al Thani, who owns a house just down the block and across 72nd Street, between Fifth Avenue and Madison Avenue.

Bill Dedman / msnbc.com

A winter view of 907 Fifth Avenue in New York City, at 72nd Street on the east side of Central Park. The taxis in this view are headed east on 72nd, leaving the park.

Now the real estate brokers must start over. Perhaps one of the other bidders will want to purchase only the $19 million apartment 8W, facing Central Park, or the $12 million apartment 8E. The apartments are said to need a lot of work, and the kitchens date from before World War II.

The brokers from Brown Harris Stevens declined to comment, as did the attorney for the public administrator of New York County, who is executor of the estate. Proceeds of the sale will help pay estate expenses, with the remainder held for the winner of the court battle over the $400 million estate of Clark, who left two wills, one favoring her family and the other favoring her nurse, attorney, accountant and a public museum to be established in her oceanfront $100 million home in Santa Barbara, Calif.

Her country estate in New Canaan, Conn., has been marked down to $17 million from its original price of $23 million.

The New York Observer reported earlier Monday that the co-op board rejected a bid from an unknown buyer.

Floor plans for the three apartments are available in our previous story.

The full story
More on the Huguette Clark mystery is at http://clark.msnbc.com/.

Do you have information on the Clark family?
Reporter Bill Dedman is writing a nonfiction book about the Clark family. If you have information, you can reach him at bill.dedman@msnbc.com.

Updated at 5 p.m. ET: The CIA foiled a plot by al-Qaida's affiliate in Yemen to bomb a U.S.-bound airliner this month, senior U.S. officials told NBC News.

Officials said the plot involved a bomb that improved on the one that had been sewn into the underpants of Umar Farouk Abdulmutallab, who failed in a plot to blow up a Detroit-bound airliner on Christmas Day 2009. That device did not detonate.

This bomb had a more refined detonation mechanism and was "totally non-metallic," which officials told NBC News would have made it more difficult to detect by traditional screening processes.

A U.S. counterterrorism official told NBC News there were “refinements on reliability” in particular that made this bomb more sophisticated and more likely to explode.

In addition to being a threat to commercial planes, the official said this type of bomb could be used in crowded places, on other transportation systems or for assassinations.

The official noted that the bomb “was never near a plane” and “never posed a risk.” The plot was disrupted well before it threatened Americans or U.S. allies, the official added.

The U.S. received the device last month. The FBI is currently conducting technical and forensics analyses on it. 

The official would not specify which international security service provided the intelligence that led to the unraveling of the plot, as there is concern about retaliatory attacks against U.S. targets inside Yemen.

Counterterror officials deem the thwarted plot a "success story," NBC News reported. The FBI said in a statement that the successful operation was the "result of close cooperation with our security and intelligence partners overseas."

Related: More than 30 Yemeni troops killed in militant attack

According to The Associated Press, the would-be suicide bomber was instructed to buy a ticket on the airliner of his choosing and decide the timing of the attack.

The U.S. official, who spoke on condition of anonymity because of the sensitive nature of the case, said the individual is not a threat but would not say where he is located. He did not provide information about the individual’s nationality or age.

It's unclear who built the bomb, but the device does bear similarities to other explosive devices built by master bomb-maker Ibrahim al-Asiri. However, Asiri may not have been directly involved in this plot. 

Related: Reports: Al-Qaida leader wanted in USS Cole bombing killed in Yemen airstrike

According to one official, there is "evidence that Asiri has passed along his bomb-making knowledge to others." The official would not say whether Asiri or an apprentice were involved in this plot.

In an exclusive meeting, a senior U.S. intelligence official told NBC News that Asiri posed the single most dangerous threat to the United States. 

According to the official, Asiri is the most capable of carrying out al-Qaida’s threat to launch a significant terrorist attack to kill Americans inside the United States.

Asiri designed the first underwear bomb that failed over Detroit and he was also the maker of the printer ink cartridge bombs that were discovered before they were shipped to the United States.

The senior official said counter-terrorism officials were seriously troubled by the ink cartridge bombs because they were "particularly sophisticated."

Related: Al-Qaida kidnapped Iranian envoy in bid to free bin Laden kin, colleagues
Related: Bin Laden fretted about al-Qaida affiliates' missteps, letters show
Related: Bin Laden in hiding: Hatching horrific plots despite crippling attacks on al-Qaida

Asiri has also implanted a bomb inside his brother in a failed attempt to assassinate Prince Mohammed bin Nayef, the Saudi deputy interior minister. The minister survived, but Asiri’s brother did not.

Asiri is not just a bomb maker but has also taken to “training the trainers,” sharing his skills with others. Officials believe he is responsible for this bomb, the one sewn into Abdulmutallab’s underwear and the one used during the attempted assassination attempt of Nayef. As director of Saudi counterterrorism, Nayef is one of the United States’ most trusted allies in the fight against al-Qaida.

For each bomb, officials are seeing a new level of refinement and sophistication.

The U.S. counterterrorism official said the thwarted attack and the recent drone death of Fahd al-Quso, an FBI “most-wanted terrorist,” was a “one-two body blow” to al-Qaida in the Arabian Peninsula, which U.S. officials have recently described as the most aggressive of the al-Qaida franchises. 

They also believe that al-Quso, director of external communications for the franchise, would have had to approve the planned May attack.

Officials also say the plot had no apparent ties to the anniversary of the killing of bin Laden. One official told NBC News the timing was coincidental.

A White House statement said President Obama was told of the plot in April. 

"The disruption of this IED (improvised explosive device) plot underscores the necessity of remaining vigilant against terrorism here and abroad," the statement read.

Reporting by NBC News' Jim Miklaszewski and Robert Windrem and The Associated Press is included in this report. 

More world news from msnbc.com and NBC News:

• Secret Service agents were 'brutes,' prostitute says
• Meet Monsieur Caramel Pudding, France's next president
• Al-Qaida releases video of American hostage
• Report: Fake bomb exposes London Olympic security
• Woman, child survive mauling by cheetahs

Follow us on Twitter: @msnbc_world

Updated at 8:16 a.m. ET: MADRID, Spain -- A woman identifying herself as the Colombian prostitute at the center of a scandal involving U.S. Secret Service personnel has called the group of agents "stupid brutes" who put partying above President Barack Obama's security. 

"These seem like completely stupid, idiotic people," Dania Londono Suarez said in an interview which aired on Monday's TODAY. "I don't know how Obama had them in his security force."

She also accused the agents of "leaving their duty behind" and described them as "stupid brutes."

The scandal broke in April when, in advance of Obama's arrival at the Summit of the Americas in Cartagena, Colombia, agents allegedly brought prostitutes to their hotel rooms.  One of the men, Suarez told NBC News, refused to pay her for sex so she went to the police.

So far, eight agents have lost their jobs as a result of the incident.

Suarez, 24, said three men who approached and propositioned her and her friends were drinking vodka like it was water.

"They liked to show off their bodies, great bodies, well-defined abs," Saurez said of the men she first met at a nightclub. "They liked attention." 

The mother of a nine-year-old son said she made it perfectly clear to one that a night with her would cost $800.

"And he accepted. And it was clear," she said. 

But in the morning after they had had sex, the man gave her only $50 and ordered her out of the room, Suarez said. 

"I am not to blame for being attractive," she told TODAY. "They are to blame -- for leaving their duty behind."

Related stories:

Prostitute at center of Secret Service scandal: 'I would have been able to get everything'

Watch the most-viewed videos on msnbc.com 

Colombia hookers not tied to cartels, terrorists, source tells NBC

Some Secret Service agents agree to lie detector tests in prostitution scandal

NBC: Prostitute's $50 fee for two agents triggered Secret Service scandal

Members of elite unit among those suspended in Colombia

More world news from msnbc.com and NBC News:

• Secret Service agents were 'brutes,' prostitute says
• Meet Monsieur Caramel Pudding, France's next president
• Al-Qaida releases video of American hostage
• Report: Fake bomb exposes London Olympic security
• Woman, child survive mauling by cheetahs 

Follow us on Twitter: @msnbc_world

Customers at one of the Florida pain clinics run by Jeff and Chris George wait their turn in chairs on the sidewalk in surveillance footage shot by the Palm Beach Sheriff's Office.

The prescription painkiller business was booming in 2009, making millionaires of Chris and Jeff George, twin brothers who operated several pain clinics in South Florida. Unfortunately for them, their customers had a tendency to die, and not always in a subtle fashion.

In November of that year, three customers were on their way to a George brothers’ clinic when the driver tried to weave her Toyota Camry through the lowered arms of a train crossing. The car was struck by commuter train going 79 mph. The driver and a passenger were ejected from the vehicle and died at the scene. The third occupant died six months later. 

An associate of the Georges who read about the accident in the paper called Chris George to break the news. “Did it say they were pain clinic people?” George asked. 

It didn’t, but the Roxicodone scattered through the backseat of the crumpled car, and on both sides of the train tracks, made it obvious to investigators that this threesome from Tennessee didn’t come to Fort Lauderdale to get tans. (Roxicodone is a brand name for one of the prescription painkillers that contain oxycodone, the opioid that has a chemical structure like heroin, with roughly the same addictive qualities.)

What George didn’t know is that federal and local investigators had already targeted him and his brother – after oxycodone distributed at George clinics was found near the dead bodies of dozens who overdosed -- and were listening to that very phone call.

Chris George, left, and Jeff George, in police booking photos broadcast by a local TV station in Florida.

Two years later the conversation would appear in a federal indictment charging the Georges with racketeering and drug trafficking for operating what federal officials say was the largest, most sophisticated painkiller trafficking organization in the country. 

Chris and Jeff George, both of whom have pleaded guilty to some of the charges against them and reported to prison last month to begin serving long sentences, declined to comment for this series, citing concerns that their remarks would add to their legal difficulties. Federal agents and prosecutors also refused interview requests, due to related cases that remain open. The information in these articles was gleaned from court records, interviews with associates of the Georges and informants, many of whom spoke on condition of anonymity. 

Fueling an oxy epidemic
South Florida -- and the Georges, in particular -- were the vanguard of what the Centers for Disease Control and Prevention calls an “epidemic” of oxycodone addiction and death -- one that had attacked America more suddenly than any drug has before. 

In 2008, prescription painkiller overdoses killed 14,800 Americans. In 2009, when the George clinics were at their peak, opioid abuse propelled a ghastly rise in the number of drug-related deaths nationwide. That year, 37,485 Americans died from narcotics overdoses -- a figure that for the first time surpassed the number of deaths from car accidents. 

“The toll our nation’s prescription drug abuse epidemic has taken in communities nationwide is devastating, and Florida is ground zero,” said Obama drug czar Gil Kerlikowske, speaking at a press conference last year. 

In 2009, Florida was one of 15 states that lacked a prescription drug tracking system, which enabled buyers to fill overlapping prescriptions without being flagged as drug abusers. That made the state susceptible to abuse on a grand scale.  

The Georges were not rags-to-riches drug dealers. They were born to a wealthy home builder named John George and grew up in Wellington, an ultra-affluent community known for its polo grounds and celebrity residents, including Bruce Springsteen. 

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South Florida was one of the first regions to be struck by the bursting of the housing bubble. By 2006, when the George family’s Majestic Homes was the featured builder on an episode of “Extreme Makeover: Home Edition,” the business was already in a tailspin. John George said that buyers were breaking their contracts because the homes were depreciating so rapidly, causing construction delays. Other buyers then complained, he said, earning Majestic an “F” from the Better Business Bureau. 

To cut costs, George closed the Majestic Homes office on Florida’s west coast run by Chris George, who moved back east across Alligator Alley to his native Palm Beach County. When he arrived, he soon learned that his brother, Jeff, had found an enterprise more lucrative than home building.

Jeff George, who has the broad shoulders and bull neck of an avid weightlifter, was selling steroids online. A physician wrote prescriptions to the buyers without having conducted a physical examination, according to a criminal indictment. That made the practice illegal.  

While moving through this black market, Jeff George made the acquaintance of a physician named William Overstreet. Versed in the nuances of Florida’s health care regulations, Overstreet suggested to George that the real money was in oxycodone, court records indicate.  

Overstreet was an authority on this subject. Based on his generosity dispensing pain pills, local cops nicknamed him the “Candy Man,” according to the criminal indictment of the Georges.  

With Overstreet’s coaching, Jeff George opened South Florida Pain Center in early 2008 in a small shopping plaza north of Fort Lauderdale. Brother Chris soon joined the business, according to court records. 

Recruiting physicians on Craigslist
To find physicians, the Georges posted Craigslist ads that promised generous pay. Job interviews were straightforward: the Georges wanted to know whether the physician was licensed by the state and registered with the DEA to prescribe controlled substances. Most important, according to the indictment, that physician had to be willing to prescribe with a heavy hand – including a drug “cocktail” of oxycodone and the anti-anxiety drug Xanax. Users often take oxy and Xanax simultaneously – a combination that killed actor Heath Ledger in 2008. 

The doctors who collaborated with the Georges had financial incentives to risk their licenses.  

Dr. Patrick Graham, for instance, maintained a successful plastic surgery practice in Boca Raton for decades, until he discovered that an office manager had been embezzling the clinic’s profits, according to friends who wrote letters to the court on his behalf. By the time he found out, it was too late to save the practice. Without enough savings to retire comfortably, and too proud to ask his professionally accomplished siblings for help, the 64-year-old Graham began working at a George clinic in July 2009. 

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He had misgivings. In one recorded call detailed in court records, Graham was asked by Chris George to turn over some of the oxycodone he had ordered, presumably so that George could sell it to street dealers. Said Graham: “I think the idea is that I’ll do this one time, but I don’t like playing around with this stuff. This is just not something that you (do) in a medical setting.” (Graham, who was sentenced to four years in prison for his role in the Georges’ operation, declined to comment for this article.)

Skeptical physicians were assured that pain clinic practice had been vetted by attorneys and was entirely legal. Each clinic was structured to insulate the workers from prosecution and to maximize the flow of painkillers, according to the indictment. 

The Georges’ pain clinic customers were directed first to a mobile MRI unit, parked behind a West Palm Beach strip club. Since every individual’s spinal column has differences in alignment, the scans were used to support diagnoses that “irregularities” were causing the patient’s pain, a claim too subjective to dispute, according to the indictment. 

Patients were required to submit urine samples to demonstrate that they weren’t abusers. But the George clinics looked the other way when patients swapped clean urine, a practice that was so common that the clinic toilets would often become clogged after patients tried to flush condoms and containers they’d smuggled into the restroom, according to the indictment. Even when the urinalysis showed the presence of narcotics, lab technicians (many of whom were friends of the Georges) waved the patients through, directing them to other clinics run by the Georges for a physician’s exam, it said. 

Although “exam” may not be the best word. It was more like a physician’s glance. Undercover investigators said pain clinic doctors devoted an average of three minutes to each patient, ignoring the results of the MRIs, failing to inquire about the patient’s medical history and neglecting to ask the questions necessary to make an objective diagnosis, according to testimony by agents in DEA hearings.  

To save physicians’ hands from cramping, they were given stamps with which to “sign” prescriptions.  

Said Michael Aruta, one of the fastest-moving physicians: “These hillbillies don’t give a s--- about their health.” Powerful painkillers, he added, are “all they’re here for,” the indictment said. (Aruta, who was sentenced to six years in prison, declined to comment for this article.) 

Having received their scripts, customers were guided to pharmacies controlled by the George family. Chris George’s wife, Dianna, volunteered to help dispense the drugs. Given the dangers of mixing a deadly dose of medication, pharmacists are trained to take specific safety measures. Dianna’s previous job was dancing at a strip club. 

Efficiency becomes a problem
The efficiency of the George clinics soon became a problem. Shortly after the South Florida Pain Center opened in 2008, the brothers outgrew it. Jeff George opened East Coast Pain in West Palm Beach and Hallandale Pain in the South Broward County city of Hallandale Beach. In summer 2008 Chris George opened a clinic he called American Pain in Boca Raton. But the voracious appetites of his pill mill customers made it necessary to find an even bigger location, which is what led him in 2009 to launch the new American Pain in a 20,000 square-foot building in Lake Worth, near a mostly immigrant neighborhood. Immigrants don’t call cops, George said during a recorded phone call. 

American Pain was the biggest single clinic in the country, a Super Wal-Mart of addiction. Investigators say that the five most generous script-writing doctors saw 500 patients per day and, at up to $100 per patient, earned nearly $2 million in a year’s time. 

Said Dr. Graham during a recorded conversation with Chris George: “You make a lot more money doing this than doing plastic surgery.” Indeed, George was heard bragging that physicians who worked for him made an average of $35,000 per week.  

The parking lot and surrounding streets were lined with cars bearing plates from Kentucky and Tennessee, hotbeds for painkiller abuse. To make it less conspicuous, the clinic instructed patients to park in lots several blocks away, where they’d be picked up by a shuttle van and delivered to the clinic’s front door. 

To keep the painkillers coming by the truckload, the Georges also needed to deceive the pharmaceutical suppliers. Investigators recorded a conversation where George told an employee, “Remember, we’re lying about how many (clinic customers) are out of state. If you give them our real dispensing log it’s going to show that everybody’s from out of state.” 

For drug dealers in states like Kentucky or Tennessee, the 1,000-mile trek to South Florida paid for itself, and it became common for them to fill a van with people willing to pose as patients with chronic pain. On average, clinic patrons (or their sponsors) paid about $5 per 30-mg dose of oxycodone, which they could sell in Appalachia for $30. Just one of the George brothers pharmacies could dole out over 10,000 doses of 30-mg oxy in a single day. 

In addition to the millions of oxy doses the clinics administered over the counter, thousands more were diverted by George employees to street traffickers, who paid cash, according to investigators’ filings. 

The grip of oxy addiction guaranteed a loyal customer base. The more patients the clinics served, the more customers lusted for another fix. According to a DEA agent’s testimony in an administrative hearing, it was common to see 30 patrons in a queue before American Pain opened at 7 a.m., many of them itching compulsively, dressed in ragged clothing and chain-smoking cigarettes. The most woebegone addicts had track marks on their arms and appeared to be under the influence of drugs, the agent said. 

Security workers cruised the clinic grounds in golf carts, steering customers to the clinic door and punishing those inclined to loiter. At Jeff George’s clinics, a friend, Derik Nolan, became an enforcer, delivering beatings to patrons who did anything that could attract police, such as snorting the drugs outside the clinics or handing them to a dealer. Proud of his role, Nolan was heard on the wire boasting, “I’m like the f----ing underboss here. I’m the one who knows all (Jeff’s) dirty little secrets and the f----ing one that gets called when s--- needs to get done.” 

Nolan who pleaded guilty to his role in managing the pill mills and was sentenced in December to 14 years in prison, referred questions to his attorney, who declined to comment. 

As patients jumped ahead of others in line, fights broke out. It was also common for patients to have drug-induced overdoses and seizures. On the day after the train killed the group from Tennessee, another clinic customer was found dead on the side of a South Florida highway. 

John George, father of the two brothers, says that the clinics were operating within the law and that any illegal activity that occurred there was the fault of rogue physicians. He did not have a role in the clinics and was not charged with any wrongdoing in connection with the case. 

Burning dollar bills in barrels
The deluge of cash became a problem. Employees could be heard on the wiretaps complaining about cash drawers being stuffed to the top. It wasn’t worth keeping dollar bills, so those were separated and then burned by the barrel. Bigger bills were stuffed into garbage bags, then hauled to a bank. Chris George’s wife, Dianna, accepted the chore of making these rather suspicious deposits, although not without grousing that she’d become her husband’s “money mule.”  

Other cash-filled bags went to the home of the Georges’ mother, Denice Haggerty, who stacked it in safes in her attic. At one point, says a friend of the Georges, there were 14 safes in the attic, each containing $1 million. Haggerty, who divorced John George in 1988, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 30 months in prison. 

The cash piled up despite the brothers’ free-spending ways. Jeff George bought a monster truck, multiple Lamborghinis and a Mercedes Saks 5th Avenue Edition. There were only five of those cars made, and George liked his so much that when he totaled it, he bought himself another, according to a friend.  

Jeff George assembled a small navy, including a 36-foot racing vessel, a 39-foot sports boat and two yachts, 38 and 55 feet in length. He also bought the shopping plaza housing his favorite strip club. The purchases were a convenient way to launder money, according to the indictment. 

As the Georges’ painkiller empire grew, it attracted enemies, both from within and without. The indictment cites recorded phone calls in which Chris George and Derik Nolan threatened violence against other pain clinic operators they perceived to be encroaching on the Georges’ turf. 

The Georges learned to suspect treachery even from their friends. A roommate of Jeff George named Robert Eddy was thought to have stolen some $500,000 in clinic funds. According to federal filings and testimony in pre-trial hearings, the brothers had Eddy handcuffed then brought to a vacant home owned by Jeff George. To intimidate Eddy, Jeff George allegedly fired a gun just inches from Eddy’s head, according to the indictment. Eventually, he was released unharmed. Chris George allegedly gave Eddy $10,000 to keep quiet about the incident, although court filings indicate the brothers remained dubious about Eddy’s loyalty. 

The incident may have made Jeff George paranoid about his other friends and clinic associates. According to the indictment, he put employees through lie detector tests. Chris George had his clinic regularly swept for listening devices. 

They even had doubts about whether they could trust the man who introduced them to the painkiller business, Dr. William Overstreet. Multiple sources with knowledge of the investigation say that the Georges had a dispute with the so-called “Candy Man” over money.  

Overstreet left the pain clinic business around 2009, moving to Panama. Shortly thereafter, Overstreet’s car reportedly flew off a cliff, killing him. The U.S. Consulate confirmed the death of an American by that name, though it refused to give a date or the manner of death, citing privacy rules.  

Jeff George made multiple trips to Panama and Costa Rica while the pain clinics were in business, but there’s no evidence he was there at the time of Overstreet’s death, and there are no filings in the drug trafficking case to suggest that he had any role in it. 

Despite the internal conflicts, the brothers’ clinics were thriving like never before in early 2010, having made nearly $1 million in a single week in late February. But on the morning of March 3, they were awakened by urgent phone calls: The clinics were being raided by a DEA task force. 

Even as masked agents emptied file cabinets and hauled off boxes of pills, clinic customers walked past them to the front desk, demanding new prescriptions. At the same time, agents were swarming through the George brothers’ homes and counting the millions of dollars squirreled away in their mother’s attic. 

'I'll take the fall'
Jeff George managed to keep a stiff upper lip. When a reporter for the Palm Beach Post called, he said, “It’s unfortunate for the patients that they have nowhere to go now. They are the ones that are really going to be affected the hardest by this.” 

Meanwhile, Chris George, who spent the morning driving in his SUV between clinics, was panicking. The feds were listening on the wire when he told his wife, Dianna, “I’m f----ed.” He added, “Babe, I don’t know. Maybe I should just kill myself.”  

Said Dianna George, “I’ll take the fall for everything, OK?”  

But perhaps there was another way out. With investigators needing months to sift through the medical records they collected at the George clinics, it would take time before the Georges were formally charged with crimes. 

In pretrial hearings, prosecutors alleged that Chris George discussed with an informant named Zack the murder of Robert Eddy, the former friend who had been handcuffed and threatened after it was believed he stole $500,000. Nothing came of the alleged plot, and Chris George was not charged with attempted murder. 

But he may have deployed another strategy for deterring witnesses. In October 2010, Chris George got a tattoo on his lower leg: a rat, its lifeless body hanging from a noose. A friend took a picture of the tattoo, then texted it to a witness in the case. 

Prosecutors moved swiftly, hauling George into court and citing the rat tattoo as evidence that the clinic kingpin was a threat to government witnesses and should be jailed without bond. A federal judge agreed. 

Having apparently exhausted all other ideas, in 2011 the George brothers finally agreed to testify against the doctors they hired at the clinics. That, as well as guilty pleas to racketeering charges, would spare them from going to trial and risking a sentence that would put them in prison for the rest of their lives.

Jeff George came to his January sentencing hearing dressed in a double-breasted suit, hands clasped contritely in front of him. His hair, frosted at the tips when he began the clinic business, was now streaked with gray. “I realize what I did was 100 percent wrong,” he told the judge. “I take 100 percent responsibility.” 

The judge sentenced him to 15 1/2 years. George has also pleaded guilty to a state case of murder in the case of a patient named Joey Bartolucci, who died by overdosing on oxycodone he received at East Coast Pain clinic. The sentence in that case may bring George’s total prison stay to 20 years. 

Chris George, who also pleaded guilty to racketeering, was sentenced to 17 1/2 years. In all, 26 of the brothers’ associates will serve time, including Chris George’s wife Dianna and the Georges’ mother, Denice Haggerty, both for more than a year. Of the nine doctors indicted in the federal case, seven have entered guilty pleas -- the first time that doctors have been convicted in a “pill mill” racketeering case. The remaining two appear likely to go to trial, currently set for August. 

20 million pills in three years
During the nearly three years that Georges’ four primary clinics operated, investigators estimated that they churned out roughly 20 million doses of oxycodone. 

Based on what they learned from listening to wiretaps, federal prosecutors believe that the Georges made at least $40 million through the pain clinic and other fraudulent enterprises. In the raid, the government seized about $5 million in cash and property worth $9 million. The rest of the money is still unaccounted for. 

It’s much harder for the government to calculate the human casualties of the George clinics. By cross-referencing files from the Florida Medical Examiners Commission, investigators found that the George’s drugs had a role in 53 overdose deaths in Florida alone. Considering that 80 percent to 90 percent of the patients came from out of state, the number of deaths that occurred outside of Florida must be far greater. As a federal prosecutor noted at one hearing, “We don’t know how many kids died behind barns in Tennessee, Ohio, Kentucky and West Virginia” -- the Appalachian states home to the Georges’ most loyal customers.  

The brothers may have known that their drug-dealing in Florida wasn’t going to last. Thanks to new state laws regulating the amount of oxycodone a single doctor can purchase, sales of the drug declined 97 percent from 2010 to 2011, according to figures cited by Obama drug czar Kerlikowske at a congressional hearing on March 1.  

In the Georges’ former base of Palm Beach County, the number of pain clinics likewise plummeted by 65 percent in the past year, according to Sheriff Ric Bradshaw, who said that the remaining clinics are either under investigation or are legitimate practices. 

These developments may have played a role in the Georges’ interest in taking their enterprise national. At the time they were raided, the brothers had recently launched a clinic in Kennesaw, Ga. and were scouting locations in Texas and St. Louis. 

Considering that the Georges’ physicians ranked among the nation’s biggest oxycodone purchasers, the bust of their South Florida clinics played a major role in reversing both local and national trends of rapidly increasing painkiller abuse. 

Despite the hard fall taken by his sons, who began serving their prison sentences on April 27, real estate developer John George still maintains that they were victims of physicians who broke the law. “We had every indication that what (the clinics) were doing was perfectly legal,” he said. “My sons aren’t doctors. They counted on the doctors and their staff to do their work correctly, but they didn’t.”

The Pentagon has released a 10-year-old video showing the interrogation of Osama bin Laden's driver, a Yemeni named Salem Hamdan.  

The video, recorded shortly after his capture in Afghanistanin 2001, shows Hamdan in a sparse room, kneeling on what appears to be a dirt floor, handcuffed with a hood over his head.   An American soldier armed with an automatic weapon removes the hood and an interrogator off camera begins to question Hamdan in Arabic.  The video include chyrons with an English translation of the exchanges.

Hamdan was convicted of providing material support to al-Qaida in 2008, while a charge of conspiring with al-Qaida was dropped.  He was sentenced to 5 ½ years and released shortly thereafter because he had already spent 6 years in custody at the Guantanamo Bay Naval Base detention camp in Cuba.

Related stories:  

Al-Qaida kidnapped Iranian envoy in bid to free bin Laden's kin, colleagues
Bin Laden fretted about al-Qaida affiliates' missteps, letters show
Security-conscious bin Laden's methods of undetected travel revealed
Bin Laden in hiding: Hatching horrific plots despite crippling attacks on al-Qaida

Hamdan returned to Yemen and is currently appealing his conviction on the grounds the charge against him did not constitute a war crime. 

The Pentagon periodically releases transcripts and videos of evidence submitted to military commissions.  

This video was released unannounced on April 12.  Pentagon officials insist the timing of the video release had nothing to do with Saturday's rearraignment of Khalid Sheik Mohammed, alleged mastermind of the Sept. 11 terror attacks, at Guantanamo.

Jim Miklaszewski is NBC News' chief Pentagon correspondent.

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A woman identifying herself as the Colombian prostitute at the center of a scandal involving U.S. Secret Service agents spoke publicly about the incident for the first time on Friday, telling a Colombian radio network that, had she been a terrorist, she could have easily pried loose details of President Barack Obama’s planned visit to Cartagena from the liquored-up agents. 

“At that moment, if I had wanted to, or if I had been part of one of those terrorist groups, it's obvious I would have been able to get everything," the woman, Dania Londono Suarez, told Caracol Radio. 

Suarez said the Secret Service personnel did not consume drugs, but “bought alcohol like one buys water” while partying at a discotheque in the tourist destination before inviting some of the “escorts” to return with them to the Hotel Caribe, where many members of Obama’s security detail were staying.

Suarez said she made clear that she expected to be paid before departing with the agent whose refusal to pay her led to exposure of the misconduct. 

“I was at a disco and he came over and told me 'sex,'" she said. "... I said, 'Baby, Cash, Money,' that I wanted money. He said, 'OK, baby. How much?' 'Eight hundred.' He told me, 'Eight hundred. OK, let's go. Come, come to hotel.'

"It was obvious. I can't believe he would be so dumb or so stupid to think I wasn't going to charge him money."

But she said that the agent had a change of heart when they awoke in his room about 6 a.m.

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“When he was drunk he was the nicest guy, but when he woke up sober, he was another person,” Suarez said. “When I asked him for the money, he told me ‘Let go, bitch.’ He pushed me into the hallway and closed the door. He wouldn't come out. I kept pounding on the door. Hotel security came.  The called the head of the hotel's security and I explained what happened to him on the phone.” 

Suarez, who has a 9-year-old son, said she traveled to Dubai after the incident but had returned to Colombia despite concern that she could face retaliation from the tarnished Secret Service personnel. 

"I fear they will retaliate against me," she said. "I left my country, practically fled. Yes I am scared. I fear or my family and for my son. No one has threatened me, no one has come to see me, but their marriages have been wrecked, they're sharp shooters, because I've been doing some research and I know they do that."

She also said her career as an escort is over: "I do not plan to that ever again," she said. "They ruined my life. They should have never published my pictures, my name." 

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Colombia hookers not tied to cartels, terrorists, source tells NBC

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The Secret Service has declined to comment on the interview. According to an official with the Secret Service the agency is close to completing its internal investigation of the incident, which occurred prior to the Summit of the Americas on April 14-15. 

The 12 Secret Service personnel at the center of the investigation were among 175 members of the service in Colombia during Obama’s visit. They were among 135 staying at the Hotel Caribe, the source said.

Seven of those members of the agency have resigned, one has been terminated and one has retired, NBC News has reported previously. Three others have been cleared of serious misconduct but given administrative punishment.  

Meantime, a separate investigation into U.S. military personnel who were allegedly involved in the incident has been concluded and forwarded to a commander for review, military and defense officials tell NBC News. 

According to the officials, who spoke on condition of anonymity, the U.S. military investigator looking into the incident zeroed in on a dozen uniformed personnel assigned to the security operation -- seven Army personnel (six Special Forces Green Berets and one White House communications specialist); two Navy bomb detection specialists, two Marine dog handlers and one member of the Air Force whose duties were not specified. 

SOUTHCOM commander Gen. Douglas Frazier will review the report and determine what, if any, punishment should be meted out. Once he formally accepts the findings of the investigation, he has four options: 

• Clear any or all the individuals of any wrongdoing.
• Administrative action (a letter of reprimand, usually a career-ender).
• Non-Judicial punishment (reduction in rank and pay).
• Criminal charges and court martial. 

In the Uniformed Code of Military Justice, consorting with or procuring the services of a prostitute is prohibited and considered a criminal act.

Erika Angulo is an NBC News producer based in Miami; NBC's Chief Pentagon Correspondent Jim Miklaszewski and Kristen Welker of NBC's Washington, D.C., bureau also contributed to this report.

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Al-Qaida and Iran had a “highly antagonistic” relationship in the years before Osama bin Laden’s death, with Iran jailing top al-Qaida officials and the terrorist organization responding by kidnapping an Iranian diplomat and threatening other violent measures to get them released, according to documents released Thursday by the U.S. government.

The feud between al-Qaida and Tehran was documented in several of the 17 letters retrieved from bin Laden’s compound in Pakistan and released by the Army’s Countering Terrorism Center at the West Point military academy in New York. While much reporting  on the documents focused on squabbling and worse between bin Laden and al-Qaida affiliates, the friction between Iran and al-Qaida  is noteworthy because it flies in the face of the view held by some U.S. conservatives that the two have worked together against U.S. interests.

Operational personnel, including Khalid Sheik Mohammed and Ramzi bin al Shibh, both part of the planning for the September 11 attacks, were dispatched to Pakistani cities, where they were later grabbed in joint US-Pakistani operations.  But the terror group’s Management Council. which handled military, security and financial affairs, among other things, were sent to Iran, where it was hoped the Iranian government would “leave them alone,” the West Point analysis of the materials said.

 “Al-Qaida did not appear to have looked to Iran from the perspective that ‘the enemy of my (American) enemy is my friend,’” it said, “but the group might have hoped that ‘the enemy of my (American) enemy would leave me alone.’”

Instead, the Iranians immediately moved to detain them and in some cases deport them to their countries of origin, the report stated.  In fact, al-Qaida believed the decision to detain and deport was taken by the Islamic Republic under pressure from the United States.  At the time, the U.S. and Iran were engaged in a number of back channel discussions on al-Qaida, according to officials from both countries.

Many of the top al-Qaida leaders languished in Iranian custody for months and years. U.S. officials admit that prior to the Abbottabad raid, they had little understanding of the circumstances of their detention -- whether it was house arrest or imprisonment. Iranian officials had always insisted the al-Qaidaofficials and their families were “in jail,” as one high ranking Iranian official told NBC News several years ago, but many U.S. officials did not believe such assurances.

The materials released Thursday, however, indicate that the al-Qaida leaders were imprisoned and held in harsh conditions.  In a letter to bin Laden, Atiyah Abd al-Rahman, essentially his chief of staff, recalled Sa’ad bin Laden, the al-Qaida leader’s son, telling him “the truths of what was happening, that they had repeatedly asked to leave Iran but they were beaten and suppressed.” The elder bin Laden, in one of his last letters to Atiyah, who is generally referred to by his first name, said that Sa’ad’s letter should be added to the group’s archives “in view of the important information it reveals about the truth of the Iranian regime.”

Negotiations for release of the prisoners ebbed and flowed, with some pleas sent directly from al-Qaida to Iranian Supreme Leader Ayatollah Sayyad Ali Khamenei.  At one point, late in 2008, al-Qaida decided to take other measures. An Iranian diplomat, the commercial counselor at the Iranian consulate in Peshawar, Pakistan, Hesmatollah Atharzadeh-Nyaki,  was kidnapped by al-Qaida operatives in November of that year. At the same time, al-Qaida apparently made other threats against Iranian interests.

Atiyah, who was reportedly killed by a U.S. drone strike in 2011, boasted to bin Laden that the diplomat’s kidnapping had a chilling effect on the Iranians, whom he referred to as “criminals” and portrayed as being afraid of al-Qaida.  

“We believe that our efforts, which included escalating a politicaland media campaign, the threats we made, the kidnapping of their friend the commercial counselor in the Iranian Consulate in Peshawar, and other reasons that scared them based on what they saw (we are capable of), to be among the reasons that led them to expedite (the release of these prisoners),” Atiyah wrote.

Still, things did not move as fast as bin Laden had hoped. He pressed Atiyah repeatedly in the letters to get his family released.  

"In the second half of 2010,” the West Point analysis said, “bin Ladin asked Atiyah to correspond with the Iranians (not clear if directly or indirectly) to tell them that ‘they promised that upon releasing their captive, they would release my family, which includes my daughter Fatima, who (should naturally stay in the company of) her husband,’” who was a top al-Qaida fighter.  

Ultimately, Iran did release some of the bin Laden family and some fighters,  some in the weeks before Bin Laden was killed. But they retained others, perhaps as hostages.  Atharzadeh-Nyaki, the Iranian diplomat, was finally released unharmed in March 2010.

A call to the Iranian Mission to the United Nations by NBC News on Thursday for comment was not returned.

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Throughout the negotiation process, Atiyah  expressed anger and frustration at the Iranians, writing at one point,  “The criminals did not send us any letter, nor did they send us a message through any of the brothers (they released)! Such behavior is of course not unusual for them; indeed, it is typical of their mindset and method. They do not wish to appear to be negotiating with us or responding to our pressures, as if to suggest that their actions are purely one-sided and based on their own initiative.”

The West Point analysis notes that the Iranians’ rationale in keeping the al-Qaida officials  prisoner for so long remains unclear, but suggests two possibilities:  to keep al-Qaida from carrying attacks in Iran or against Iranian assets overseas or as bargaining chips in negotiations with the United States.

In fact, U.S. and Iranian officials have told NBC News that third parties approached the U.S. in the years after 9-11 to offer a deal in which al-Qaida personnel  would be traded for leaders of the People’s Mujahedin of Iran who were in U.S. custody in Iraq.  The U.S., both sides report, declined.

Robert Windrem is a senior investigative producer for NBC News.

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ISLAMABAD , Pakistan – One of the 17 letters seized during the 2011 U.S. raid on Osama bin Laden's Abbottabad compound and published Thursday reveals the lengths the al-Qaida chief went to keep himself and his family hidden and sheds light on how they apparently managed to remain undetected for so long while moving around Pakistan. 

The letter from bin Laden to “Sheik  Mahmud” was part of a cache of documents translated and released by the Combating Terrorism Center at West Point. A senior U.S. official told NBC News that "Sheik Mahmud" was actually Atiyah Abd al-Rahman, essentially bin Laden's chief of staff until he was killed in August 2011 by a CIA drone strike.

The letter is not dated, but analysts believe it was written between July 4 and Oct. 20, 2010. During that time, bin Laden would have been living in the Abbottabad compound where he was later killed, along with two of his wives -- Siham, a Saudi national, and Amal, of Yemeni origin -- as well as several children and grandchildren. His second wife, Khairiah -- also from Saudi Arabia -- had been under house arrest in Iran, along with other members of the bin Laden family, and was being released. 

Once inside Pakistan, the letter said, she was to be taken "to the tunnel between Kuhat and Peshawar," where she should meet an al-Qaida contact and switch vehicles. "The meeting will be precise in timing and it will be inside the tunnel, and they will change cars inside the tunnel," he wrote, later explaining that moving through the tunnel was key to "avoiding surveillance." 

From there, he instructed the first car to "drive to an area that is unsuspected," while his wife in the second car would "go to Peshawar, go to one of the closed markets, and change cars again, then head to a safe place in Peshawar until we arrange for them to come, with Allah's will." Bin Laden even went so far as to consider the weather conditions, writing that the cars leaving the tunnel should "move after getting out of it in overcast weather, even if that would lead to them waiting for some time, knowing that the Peshawar area and its surroundings is often overcast." 

Read excerpts of the letter from bin Laden to 'Sheik Mahmud'

Bin Laden also warned of "the importance of getting rid of everything they received from Iran, like baggage or anything, even as small as a needle," concerned that tracking or listening devices could have been planted in clothes or other items in their possession. "Since the Iranians are not to be trusted, then it is possible to plant chips in some of the coming people's belongings," he wrote. 

It is unknown whether Khairiah's journey from Iran to Abbottabad actually followed this path, but her arrival at the compound, believed to have occurred in March or February 2011, reportedly caused many problems in the household. 

Brigadier Shaukat Qadir, a retired Pakistan Army officer who leveraged his military, intelligence, and tribal contacts to conduct an independent investigation into bin Laden's presence in Pakistan and the U.S. raid that killed him, was given access to the widows' interrogation transcripts, as well as the compound before it was destroyed. In his report, Qadir wrote that Khairiah was often at odds with other members of the household, particularly bin Laden's youngest wife, Amal, with whom he shared the third-floor living area, and bin Laden's son -- Khalid --  who also was highly suspicious of Khairiah's desire to join the family in Abbottabad. 

"Apparently," Qadir wrote, "he repeatedly asked her why she had come and, finally, on one occasion, (she) responded with a smile, "I have one final duty to perform for my husband.'" 

Qadir's theory is that Khairiahbetrayed her husband, leading authorities to him as she made her way from Iran. Bin Laden was killed in the U.S. raid within two or three months of her arrival.

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A Pakistani official, speaking on condition of anonymity, told NBC News she was "uncooperative" and "very difficult" during interrogations, acting aggressively towards the Pakistani authorities who questioned and held her for almost a year before she and the others were deported to Saudi Arabia last week. 

Previously, the only information available from family members about their movement came from an interrogation report of bin Laden’s youngest wife, Amal. Her testimony, which was summarized, described  how bin Laden and family members were moved quickly and frequently after 9/11 in an effort to keep them safe. She recalled being moved from place to place across the country, sometimes bouncing between multiple residences in a town or city. Her temporary homes ranged from the southern, mega-city of Karachi, to the crowded northwest capital of Peshawar, and the remote Swat Valley. 

Whether Qadir's theory proves true or not, the details and locations included in bin Laden's letter of instructions may provide clues as to how and where, exactly, he and his family moved around Pakistan for so many years, completely undetected.

Amna Nawaz is an NBC News correspondent in Pakistan.

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In letters from his hideout in Pakistan written in the five years before his death, Osama bin Laden fretted about dysfunction among the far-flung affiliate organizations in his terrorist network, according to documents seized during the U.S. military’s raid on his compound that that were released on Thursday. 

Seventeen declassified letters seized in last year's raid on bin Laden's compound by U.S. Navy SEALs were posted online Thursday by the U.S. Army's Combating Terrorism Center, accompanying its analysis of their contents titled, "Letters from Abbottabad: Bin Ladin Sidelined?" The letters -- 175 pages in Arabic -- probably represent only a small fraction of materials taken from the compound, the center’s distinguished chair, retired Gen. John Abizaid, said in a note published with the translations.

But the letters released Thursday, which were written between September 2006 and April 2011, add new nuances to the previous reports. 

Among other things, they show the al-Qaida founder was troubled by the actions of other Islamist groups that aligned themselves with his terrorist network.

As Associated Press reporter Kimberly Dozier puts it:

The documents show dark days for al-Qaida and its hunkered-down leader after years of attacks by the United States and what bin Laden saw as bumbling within his own organization and its terrorist allies.

The so-called affiliate organizations – including al-Qaida in Iraq, al-Qaida in the Arabian Peninsula; the Tehrik-e-Taliban Pakistan (Student Movement of Pakistan); and the Somalia-based Harakat al-Shabaab al-Mujahideen – were of particular concern to bin Laden. 

In the words of the report’s authors: 

Rather than a source of strength, bin Ladin was burdened by what he viewed as the incompetence of the “affiliates,” including their lack of political acumen to win public support, their media campaigns and their poorly planned operations which resulted in the unnecessary deaths of thousands of Muslims. 

"I plan to release a statement that we are starting a new phase to correct (the mistakes) we made," bin Laden wrote in 2010. "In doing so, we shall reclaim, God willing, the trust of a large segment of those who lost their trust in the jihadis."

Nothing in the papers points directly to al-Qaida sympathizers in Pakistan's government. Bin Laden described "trusted Pakistani brothers" but didn't identify any Pakistani government or military officials who might have been aware of or complicit in his hiding in Abbottabad. 

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The letters also indicate that American Adam Gadahn played a much greater role in al-Qaida than has been acknowledged by U.S. authorities, who have often dismissed him as a propagandist and spokesman. In fact, Gadahn appeared to act as an adviser to bin Laden and in one letter urged that al-Qaida disassociate itself from al-Qaida in Iraq. 

One letter also outlined Gadahn’s views of U.S. news organizations as part of a discussion of how al-Qaida might go about publicizing the 10^th anniversary of the Sept. 11, 2001, terror attacks on the U.S.

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He indicated a particular dislike of Fox News, writing, “Let her die in her anger”; said MSNBC-TV appeared to be “good and neutral a bit,” while complaining about the firing of Keith Olbermann; said CNN appeared to be aligned with the U.S. government but was better in its Arabic reports; and made flattering comments about CBS and ABC.

NBC News senior investigative producer Robert Windrem contributed to this report.

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Criminals found an easy place to launder money at HSBC Bank USA, according to allegations contained in documents from a federal investigation of the bank, Reuters news agency reported Thursday.

Reuters reporters said they reviewed confidential documents from investigations by two U.S. attorney's offices of HSBC Bank USA, which is the U.S. arm of HSBC Holdings Plc of London.

U.S. attorneys in Florida and West Virginia are investigating claims that HSBC violated money laundering laws by failing to review transactions for possible connections to crimes including drug trafficking and terrorist financing.

The bank divulged in regulatory documents in February that it is being investigated by the Justice Department, the Federal Reserve and other authorities, and said it is likely to face criminal or civil litigation, Reuters reported. No one from the bank has been charged with a crime.

The documents were early drafts written by investigating U.S. attorneys and could have been superseded by subsequent investigation, Reuters reported. It quoted from a draft of a 2010 letter from William J. Ihlenfeld II, U.S. attorney for the northern district of West Virginia, who told Justice Department officials that HSBC's anti-money laundering departments were a "systemically flawed sham paper-product designed solely to make it appear that the Bank has complied" with the Bank Secrecy Act, which requires banks to monitor transactions for money laundering.

The bank issued a statement to Reuters, saying, "We continue to cooperate with officials in a number of ongoing investigations. The details of those investigations are confidential, and therefore we will not comment on specific allegations."

The full story from Reuters is here.

Prostitutes in Colombia who were paid for sex by Secret Service personnel last month days before President Barack Obama visited the South American country had no ties to drug cartels or terrorist organizations, a source with knowledge of the investigation tells NBC News. 

The source, speaking on condition of anonymity, said the information was included in a 24-page written response from Secret Service officials to congressional committees investigating a recent prostitution scandal involving members of Obama’s advance security team.

Investigators still are trying to interview two other women involved in the incident, which occurred prior to the Summit of the Americas on April 14-15, the source said. 

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Seven of the Secret Service personnel at the center of the probe have resigned, one has been terminated and one has retired, NBC News has reported previously. Three others have been cleared of serious misconduct but given administrative punishment.

House Oversight and Government Reform Committee Chairman Darrell Issa, R-Calif., and ranking Democratic Rep. Elijah E. Cummings, D-Md., issued a joint statement in response to the letter received late Tuesday from U.S. Secret Service Director Mark Sullivan. 

"We appreciate the Secret Services' detailed responses to our questions,” it said. "Director Sullivan's cooperation with our oversight efforts underscores his commitment to understand the extent of the problem and ensure that this unacceptable conduct does not occur again.” 

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The 12 Secret Service personnel at the center of the investigation were among 175 members of the service in Colombia during Obama’s visit. They were among 135 staying at the hotel El Caribe, the source said. 

The source also confirmed that bureau investigators are looking into a separate report by a Seattle-based investigative reporter that Secret Service personnel may have engaged in similar misconduct in El Salvador prior to a visit by Obama in 2011.  

According to the source, investigators looked through records from the trip, spoke to supervisors and gone through timelines, but so far have found no evidence of misconduct. They are also trying to talk to Chris Halsne, the reporter who wrote the story, but he was unwilling to divulge his sources, the source said. 

NBC News Capitol Hill Correspondent Kelly O'Donnell contributed to this report.

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The mad cow discovered in California last week was not really a mad cow. It suffered from a closely related disease. There is  no cause for alarm at this point, but several top scientists say the public health implications may not be as clear the U.S. Department of Agriculture would have us believe.

The diseased dairy cow from a rendering (or carcass recycling)  plant in Hanford, Calif., near Fresno, was infected with a condition variously known as BASE (bovine amyloidotic spongiform encephalopathy), atypical BSE and L-type BSE, which has so far been found in about 70 animals in the world. Lyndsay Cole, a spokeswoman for USDA, confirmed the diagnosis in an email Tuesday.

This condition, first reported in two Italian cows in 2004, causes the same rapid crippling and death as the classic bovine spongiform encephalopathy (BSE) that swept through Britain and much of Europe in the 1980s and '90s. But the brains of the animals look very different after their demise.

However, there is an urgent need for further study, they say.

What irks many scientists is the USDA’s April 25 statement that the rare disease is “not generally associated with an animal consuming infected feed.”

The USDA’s conclusion is a “gross oversimplification,” said Dr. Paul Brown, one of the world’s experts on this type of disease who retired recently from the National Institutes of Health.  "(The agency) has no foundation on which to base that statement.”

“We can’t say it’s not feed related,” agreed Dr. Linda Detwiler, an official with the USDA during the Clinton Administration now at Mississippi State.

In the May 1 email to me, USDA’s Cole backed off a bit. “No one knows the origins of atypical cases of BSE,” she said

The argument about feed is critical because if feed is the cause, not a spontaneous mutation, the California cow could be part of a larger outbreak.

The British and European outbreaks of BSE ignited because the industry turned cattle -- natural vegetarians -- into cannibals, feeding them the remains of cattle and other animals. U.S. farmers did the same, but Britain had a huge incidence of a related disease in sheep called scrapie, and many scientists believe that was the source of the massive cattle outbreak. Although experiments showed that BSE could infect monkeys and other animals, it was not until the first human infections that anyone realized the threat it poses to people. The human form of the disease, first discovered in Britain in the 1980s, has been blamed for the deaths of at least 280 people worldwide, with 175 in the UK alone.

How could the California cow have been infected with feed?  Following the British outbreak, ranchers in the U.S. and most of the rest of the world stopped feeding cattle the remains of cattle, sheep and other mammals. But a farmer’s feed still could get contaminated by other means. The USDA still allows chickens to consume the remains of cattle. Chicken litter, containing urine and feces, is fed to cows. That could theoretically transmit the infection to cattle.

And if it is feed, what does that say about the potential of an outbreak in the rest of this cow’s heard?  It appears the USDA and the California Department of Food and Agriculture are investigating. Dr. Jim Cullor, associate dean of the University of California, Davis, School of Veterinary Medicine and an expert on many animal illnesses, spoke to me from his office, which is close to the dairy farm that housed the sick cow.  He would not identify the farm (nor will any government agency) but he did say dairy farms in the area usually have about 3,000 animals (about half of them milk producers). But some farms in the area have as many as 10,000 head, Cullor explains. Typically, the inspectors would visit the farm’s “hospital,” where sick animals are treated. They would also go over the hospital’s records as well as the farmer’s feed and records of past feed purchases. 

“That farmer will feel like he’s had a visit from the IRS,” Cullor quipped.

But does such an inspection guarantee safety? Dr. Michael Hansen of the Consumers Union, along with many scientists, argues that, like Europe, the U.S. should test all animals that look sick or are over 6-years-old before they enter the food supply. The rationale behind testing healthy animals 6 years old or older is that BSE usually takes that long to develop. 

"With thorough testing we would know the food supply is safe,” Hansen said. “We wouldn’t be guessing.” 

We would also learn the true incidence and origin of spontaneous and atypical cases.

But the U.S. tests far fewer animals -- about 40,000 of the 35 million cattle slaughtered annually. The argument is about cost, an estimated $25 to $30 per animal.  Widespread testing would add a few cents to the cost of a pound of beef. Britain, Europe, Japan and several other nations have decided it is worth it. The USDA says it is not and declares: “The surveillance program allows USDA to detect the disease if it exists at very low levels in the U.S. cattle population.”

Few scientists would argue that the one California cow which never was headed to the U.S. food supply represents a health hazard. But many maintain that the current surveillance is insufficient. Dr. Kurt Giles, an expert in neurogenerative diseases now at the University of California, San Francisco, was at Oxford during the British outbreak.  He told me USDA’s assurances about safety today remind him of British statements during the 1980s. 

“It is so reminiscent of that absolute certainty,” he said.

Robert Bazell is NBC's chief science and medical correspondent. Follow him on Facebook and on Twitter @RobertBazellNBC

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