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Fired US Attorney Preet Bharara Said to Have Been Investigating HHS Secretary Tom Price

Former U.S. Attorney Preet Bharara, who was removed from his post by the Trump administration last week, was overseeing an investigation into stock trades made by the president's health secretary, according to a person familiar with the office.

 

Tom Price, head of the Department of Health and Human Services, came under scrutiny during his confirmation hearings for investments he made while serving in Congress. The Georgia lawmaker traded hundreds of thousands of dollars worth of shares in health-related companies, even as he voted on and sponsored legislation affecting the industry.

 

Price testified at the time that his trades were lawful and transparent. Democrats accused him of potentially using his office to enrich himself. One lawmaker called for an investigation by the Securities and Exchange Commission, citing concerns Price could have violated the STOCK Act, a 2012 law signed by President Obama that clarified that members of Congress cannot use nonpublic information for profit and requires them to promptly disclose their trades.

 

The investigation of Price's trades by the U.S. Attorney's Office for the Southern District of New York, which hasn't been previously disclosed, was underway at the time of Bharara's dismissal, said the person.

 

Bharara was one of 46 U.S. attorneys asked to resign after Trump took office. It is standard for new presidents to replace those officials with their own appointees. But Bharara's firing came as a surprise because the president had met with him at Trump Tower soon after the election. As he left that meeting, Bharara told reporters Trump asked if he would be prepared to remain in his post, and said that he had agreed to stay on.

 

When the Trump administration instead asked for Bharara's resignation, the prosecutor refused, and he said he was then fired. Trump has not explained the reversal, but Bharara fanned suspicions that his dismissal was politically motivated via his personal Twitter account.

 

"I did not resign," he wrote in one tweet over the weekend. "Moments ago I was fired."

 

"By the way," Bharara said in a second tweet, "now I know what the Moreland Commission must have felt like."

 

Bharara was referring to a commission that was launched by New York Gov. Andrew Cuomo in 2013 to investigate state government corruption, only to be disbanded by the governor the next year as its work grew close to his office. In that case, Bharara vowed to continue the commission's work, and eventually charged Cuomo associates and won convictions of several prominent lawmakers.

 

Bharara referred questions from ProPublica to the U.S. attorney's office in the Southern District of New York. A spokesperson there declined to comment. The Justice and Health and Human Services departments also didn't respond to requests for comment.

 

A White House spokesperson didn't respond to questions about whether Trump or anyone in his cabinet was aware of the inquiry into Price's trades.

 

In December, the Wall Street Journal reported that Price traded more than $300,000 worth of shares in health companies over a recent four-year period, while taking actions that could have affected those companies. Price, an orthopedic surgeon, chaired the powerful House Budget Committee and sat on the Ways and Means Committee's health panel.

 

In one case, Price was one of just a handful of American investors allowed to buy discounted stock in Innate Immunotherapeutics — a tiny Australian company working on an experimental multiple sclerosis drug. The company hoped to be granted "investigational new drug" status from the Food and Drug Administration, a designation that expedites the approval process.

 

Members of congress often try to apply pressure on the FDA. As ProPublica has reported, Price's office has taken up the causes of health care companies, and in one case urged a government agency to remove a damaging drug study on behalf of a pharmaceutical company whose CEO donated to Price's campaign.

 

Innate Immunotherapeutics' CEO Simon Wilkinson told ProPublica that he and his company have not had any contact with American law enforcement agencies and have no knowledge of authorities looking at Price's stock trades.

 

Another transaction that drew scrutiny was a 2016 purchase of between $1,001 and $15,000 in shares of medical device manufacturer Zimmer Biomet. CNN reported that days after Price bought the stock, he introduced legislation to delay a regulation that would have hurt Zimmer Biomet.

 

Price has said that trade was made without his knowledge by his broker.

 

In a third case, reported by Time magazine, Price invested thousands of dollars in six pharmaceutical companies before leading a legislative and public relations effort that eventually killed proposed regulations that would have harmed those companies.

 

Louise Slaughter, a Democratic Congress member from New York who sponsored the STOCK Act, wrote in January to the SEC asking that the agency investigate Price's stock trades. "The fact that these trades were made and in many cases timed to achieve significant earnings or avoid losses would lead a reasonable person to question whether the transactions were triggered by insider knowledge," she wrote.

 

What federal authorities are looking at, including whether they are examining any of those transactions, is not known.

 

Along with the Price matter, Bharara's former office is investigating allegations relating to Fox News, and has been urged by watchdog groups to look into payments Trump has received from foreign governments through his Manhattan-based business. Bharara's former deputy, Joon Kim, is now in charge of the office, but Trump is expected to nominate his replacement within weeks.

 

ProPublica reporters Jesse Eisinger and Justin Elliott and research editor Derek Kravitz contributed to this story.

 

ProPublica is a Pulitzer Prize-winning investigative newsroom. Sign up for their newsletter.

 

 

 

 

 

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Weaving a Better Life
When Vijaya Switha graduated from IRMA (Institute for Rural Management, Anand), she had the experience of working with craftspersons. The challenges they faced to produce and market led her to the one question, “What do rural enterprises in India need the most?” The answer was development of skills, enhancement of knowledge and market access. Vijaya found her cause—working with the artisan rather than engaging with the art. 
 
Chitrika Foundation was established in 2005 to revamp weaver producer enterprises into business enterprises. It provides turnkey solutions and assistance to the handloom weaving sector, India’s second largest employer after agriculture. Chitrika works directly with weavers to establish weaver-owned, weaver-managed and self-sustained production companies under the progressive and pro-community APMACS Act, 1995 (Andhra Pradesh Mutually Aided Cooperative Societies Act, 1995). 
 
In Chitrika’s model, a majority stake in the production company is held by weavers’ enterprises and the remainder by other stakeholders. Each weaver’s enterprise has its own support units for raw materials, dyeing, printing and garmenting.
 
Production companies empower weavers to procure finance, negotiate for raw materials, innovate designs, ensure a fair price for the product and undertake marketing. The centralised pre-loom, on-loom and post-loom model is a first-of-its-kind in India and offers increased income to the weaver. Currently, Chitrika works with two production companies in Srikakulam and East Godavari districts of Andhra Pradesh. Vamshadhara Weavers’ Producing Company, in Punduru (Srikakulam), has 500 members. It started as four cooperative societies that merged in 2014. Srikakulam is well-known for khadi and traditional designs. 
 
Godavari Women Weaver’s Services Producer Company, formed in 2014 in Mandapeta, in collaboration with ALC-India, is India’s first women weavers’ producing company with 247 members. They aim to reach 3,000 women weavers, the mainstay of the weaving industry in East Godavari, since men have moved away to nearby towns for employment. The centralised process has given weavers the advantage of training programmes and access to buyers’ feedback leading to design innovations with inputs from a design consultant. Members have looms at home and weaving is a family activity. On an average, three members of a family are involved in the various weaving processes. Each loom changes designs every year. Dyeing is now a mechanised process. The weavers are introduced to technology in marketing, production and inventory management. 
 
The producer companies are now in charge of their marketing efforts. Apart from handloom exhibitions all over India, the fabrics are retailed through Fabindia and Jaypore. A gratifying development is that 10 young, educated weavers are now involved in the production companies. 
 
Recent milestones for Chitrika’s efforts have been a 100% increase in incomes at Vamshadhara Weavers’ Producing Company and 100% change in product portfolio in these producing companies in the past five years. Chitrika is a lean organisation with 12 people. They recently received a grant from Ford Foundation. Other sources of income are the consultancy projects they undertake in artisan support organisations. Some funding partners include the Government of India, Government of Andhra Pradesh, Rang De, Friends of Women’s World Banking, Ratan Tata Trust and Access Livelihoods Consulting India Public Ltd.
 
As Gandhiji wrote in Young India in 1920, “I feel convinced that the revival of hand-spinning and hand-weaving will make the largest contribution to the economic and the moral regeneration of India. The millions must have a simple industry to supplement agriculture. Spinning was a cottage industry years ago, and if the millions are to be saved from starvation, they must be enabled to reintroduce spinning in their homes and every village must repossess its own weaver.”
 
Nearly a century later, Chitrika’s work with the weavers of Andhra Pradesh shows Gandhiji’s words coming to fruition, in no small measure. All donations to Chitrika are exempt from income-tax under Section 80G.
 
Chitrika
Second Floor, 17-1-383/47, 
4th Cross Road, 
Vinay Nagar Colony, 
Saidabad, Hyderabad, 
Telangana 500 059. 

 

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