All Native Hawaiians need to reclaim ancestral land is a $300,000 mortgage -- and to wait in line for decades

Zalei Kamaile dreamed of owning a home.

The professional ukulele player worked long hours entertaining tourists on Oahu and saved her tips in a cookie jar. The money went into a modest house fund for her and her mother, but she knew that wouldn't be enough. So in 1987, Kamaile, then 35, took the one step she considered her best shot at homeownership. She applied to a homesteading program for Native Hawaiians. Created by Congress in 1921, the program had a singular goal: return Hawaiians — especially impoverished ones — to their native lands.

Over the next two decades, Kamaile received more than a dozen letters offering her an opportunity to get a homestead. The land, part of a 203,000-acre trust, would be virtually free under a long-term lease. But there was a catch: An applicant either had to build their own home or purchase one from a developer. At least five of Kamaile's offers were for new subdivisions in Kapolei, a growing bedroom community in West Oahu. Amid a soaring real estate market, the homes were a bargain, costing about half the price of similar housing elsewhere.

Kamaile, however, couldn't qualify for a mortgage.

During that period, she lost her job, declared bankruptcy and spent two years homeless, part of it living in a tent on the beach. Kamaile passed on each offering, tossing the letters in the garbage. “I cried an awful lot," she said.

Today, Kamaile, 68, still doesn't have a homestead. She's about 3,500 applicants deep on a waitlist, 33 years after she first applied. She lives in a cramped rental apartment in a low-income housing project and serves as caregiver for a disabled family friend who lives with her. Kamaile's mother died last year, 10 days shy of her 91st birthday. Kamaile still regrets not being able to provide her with a homestead. “That was my one wish for her."

The Honolulu woman's story reflects what has been a decadeslong failure of the state Department of Hawaiian Home Lands to fulfill its mission.

Under state law, anyone who is at least half Hawaiian and 18 or older is considered a beneficiary of the land trust and entitled to get a homestead in a “prompt and efficient manner." Qualifying for financing is not listed as a requirement, but that has essentially become one because of the way the program is run. As a result, Hawaiians with the financial means and knowledge to navigate the complicated system are able to get homesteads with relative ease while thousands of others continue a generations-long wait for the land that is their birthright, an investigation by the Honolulu Star-Advertiser and ProPublica has found.

Over the past 25 years, the department, known as DHHL, has largely invested in building sprawling subdivisions. Intended to satisfy a crushing demand for housing, the remedy has exacerbated the problem, as the homes have proved too expensive for many applicants.

The result has been an ever-lengthening waitlist, now 23,000 people long, as Native Hawaiians struggle in one of the country's most expensive housing markets. At the average rate the department has developed residential lots since 1995, it would take 182 years to meet demand — before figuring in expected waitlist growth.

State and federal watchdogs have long criticized the department for its failure to deliver homesteads in a timely fashion, and this year, the Hawaii Supreme Court concluded that “the state of Hawaii has done little to address the ever-lengthening waitlist" over the past 30 years.

Under the current model, the department often goes thousands deep to find interested and qualified buyers, effectively bypassing low-income Hawaiians who have been waiting longer.

Since 1995, for example, DHHL has awarded about 2,200 residential leases to Oahu residents. Sixty percent of them went to beneficiaries who came from census tracts with median household incomes higher than $75,000, the two news organizations found through an unprecedented analysis of tens of thousands of lease transactions, waitlist records and other documents.

Jade Miyazaki was one of them. A hotel marketer, she already owned a small townhouse, but she applied for the homesteading program hoping to get more space for her family of five.

She got a home in 2010 in Kanehili, one of the subdivisions that Kamaile, the ukulele player, passed on. Miyazaki had waited only a quarter of the time even though she was more than 2,000 places deeper on the waitlist. But unlike Kamaile, Miyazaki could afford the mortgage.

She was among the last of the so-called waitlisters to be awarded land leases in the 375-home subdivision, where home prices at the time averaged about $345,000 in today's dollars.

Today, the median household income for Kanehili and two other nearby homestead subdivisions is about $100,000. That is nearly double the approximately $55,000 median income for waitlister households, according to a 2017 federal study on Native Hawaiian housing.

“This program creates a division among Hawaiians," said Vanessa Garcia Phillips, a beneficiary leader who has been on the waitlist a relatively short three years. “You have the haves and the have-nots."

In the meantime, more Hawaiians will continue to die waiting. Analyzing trust records, the Star-Advertiser and ProPublica found that more than 2,000 beneficiaries already have died while on the waitlist without receiving homesteads — a number that has not been previously reported but that many agree is a severe undercount. The department records the death of a beneficiary only if the family provides a death certificate.

The investigation by the news organizations marks the first time DHHL's subdivision strategy has been extensively examined, and many of the findings are new — even to DHHL. The agency said it didn't have the staff or tools to replicate the analysis, but it acknowledged its model produced housing prices beyond the reach of many waitlisters. Read more about the analysis here.

Still, officials defended the approach, saying they were doing what they could to deliver on what waitlisters consistently rank in surveys as their top choice: single-family homes. When the department built duplexes about two decades ago, it got a lackluster response from beneficiaries, some of whom believe the law promises them land, not just housing.

About 8,400 residential leases have been awarded since 1921, said William J. Aila Jr., who serves as department director and chairman of the Hawaiian Homes Commission, which oversees the agency and the land trust. To address the affordability problem, he said, the department has provided a greater number of less-costly lease options, such as empty lots where beneficiaries can build their own homes. It also offers services like financial literacy classes to help low-income beneficiaries.

“It's not a complete success. But it's not a complete failure," said Aila, who lives on a homestead.

Many beneficiary advocates and political leaders disagree. They say the agency needs to overhaul its approach and to focus more on housing that waitlisters actually can afford.

“It's not working for anybody," said former Gov. John Waihee, the only Native Hawaiian to serve in that office — his term ran from 1986 to 1994 — and whose father died while on the waitlist. “It's not working for the community. It's not working for the state of Hawaii. If the program were doing what it should, we would have less of a housing crisis than we have now."

A Prince's Vision

In 1893, the U.S. backed an illegal overthrow of the Hawaiian monarchy, partly to protect U.S. sugar interests in the islands. A group representing U.S. and European sugar planters, financiers and missionary descendants, supported by U.S. naval forces, deposed the monarchy and proclaimed a provisional government. Five years later, the U.S. annexed the island chain, obtaining roughly 1.8 million acres of former kingdom land without compensating the Hawaiians. By then, the indigenous population was headed toward extinction as disease, poor living conditions and other factors contributed to their dwindling numbers. Many impoverished Hawaiians, who had been displaced from their lands, lived in slum-like tenements in urban Honolulu.

Prince Jonah Kuhio Kalaniana'ole, considered the father of the Hawaiian Homes program and Hawaii's then-nonvoting delegate to Congress, around 1918 envisioned using some of the former kingdom lands to create a land trust to uplift Native Hawaiians. Kuhio's idea was to return them to their native lands so they could become self-sufficient, maintain the culture and reverse the population decline. “This rehabilitation bill is the first opportunity given the poor man to go on the land with funds to help him make a living," Kuhio said in Honolulu in 1920 as he lobbied to build public support.

The Hawaiian Homes Commission Act was signed into law in 1921. But the program, run by Hawaii's territorial government under U.S. supervision, was seriously hampered from the start.

Much of the land was remote and ill suited for homesteading, lacking water and other basics. And the federal government provided little funding and inadequate oversight. In the first 38 years, only about 1,700 homesteads were awarded. The poor conditions persisted after the state took over management as a requirement of statehood in 1959.

State and federal reports going back decades have identified many faults, including the state's inability to deliver homesteads in a timely manner.

Stung by the decadeslong criticism over the waitlist problem, DHHL in the early 1990s switched from so-called pocket development — constructing homes in small numbers — to building large subdivisions. The change enabled the agency to offer dozens and sometimes hundreds of so-called turnkey homes in batches.

The Waihee administration was instrumental in advancing that strategy. The governor and his team secured from the state a $600 million settlement to compensate DHHL for misuse of trust lands in the years following statehood. The state paid the agency $30 million annually for 20 years starting in 1995, and much of that money went to infrastructure work for new subdivisions.

Some waitlisters were thrilled. The benefits of getting a homestead are substantial in a state with soaring real estate markets; the median price for a previously owned single-family home on Oahu, for instance, hit $789,000 in 2019.

For turnkey houses, beneficiaries pay about half as much as they would for comparable homes off trust land. That's because DHHL, not the buyer, covers land and infrastructure costs, builders say. In addition to the purchase price, beneficiaries pay only $1 annually for a land lease, which runs for 99 years.

Holding a lease comes with significant tax advantages. Homesteaders pay no property taxes for the first seven years following a lease award. After that, they still get a break, depending on location. On Oahu, homesteaders pay $300 annually, regardless of the value of the residence, potentially saving thousands of dollars a year.

But when the department started construction on its first master-planned subdivision in 1994, officials soon ran into a problem: a lack of qualified buyers.

Winona Kauhane, a former loan officer for a private lender working with DHHL on the project, recalled reviewing waitlist applications to fill the 271 new homes in Princess Kahanu Estates along Oahu's Waianae Coast. The development was aimed at providing housing for the working poor — typically two-income families who couldn't afford to buy elsewhere. Sifting through several thousand files, though, Kauhane realized that most applicants couldn't qualify for the mortgages needed to purchase the houses, which averaged about $208,000 in today's dollars.

Motivated to get Hawaiians onto the land, Kauhane helped craft a legal workaround that involved recruiting a waitlister's family member who could finance the deal. The lease would be awarded to the applicant, who served as a pass-through and simultaneously transferred it to the family member bankrolling the purchase. Depending on the circumstances, the applicant still could live in the home. “That was the only way we could get these people or their families into a home," Kauhane said. “They deserved that opportunity."

There were more than 100 of these simultaneous transactions following lease awards in the past 25 years, according to the analysis. Even with the workarounds, though, the department still had to go more than 4,000 deep into the waitlist to get enough buyers for the 271 homes in Princess Kahanu Estates — an indication to some critics that the subdivision model was problematic from the start.

“They Exclude People Like Myself"

Over the years, Native Hawaiians have increasingly turned to the homesteading program for relief as Hawaii grapples with a severe shortage of affordable housing and the nation's second-worst homelessness crisis. The statewide residential waitlist has grown by over 50% since 1995.

While DHHL does not track income in a systematic way, there are indications that many applicants are struggling financially. A federal study found that about 20% of households on the waitlist received public cash assistance — nearly three times the rate of Native Hawaiians and more than six times that of the general population. According to a separate 2014 survey conducted by DHHL, only about a quarter of waitlisters said they could afford the 10% down payment on a mortgage for a $150,000 home. Many turnkey properties now cost at least double that. In Kapolei on Oahu's west side, where Kanehili was developed and where much of the island's residential growth is happening, prices in new homestead neighborhoods are approaching $400,000.

“When you do all turnkey development, and the average price for a house is somewhere around $300,000 to $400,000, what happens is you start skimming the cream of the waitlist, only those who can qualify for those homes," Aila, the DHHL director, acknowledged. “So you miss a lot of people."

Robin Danner, a beneficiary leader from Kauai, said DHHL needs to rethink its financial requirements and give beneficiaries more flexibility to build their own housing. “Their duty is not to check my credit," she said. “Their duty is to issue me my land."

Aila acknowledged that the law does not require a beneficiary to qualify for a mortgage to get a homestead. But any structure built on trust land must meet county building and zoning codes, according to the state administrative rules the department uses, and that prohibits substandard construction. “We can't let you live in a tent because that's substandard living," Aila said.

Critics, however, say DHHL, with its focus on subdivisions, has strayed too far from the intent of the 1921 homesteading law. “The program is really turned on its head," said attorney Tom Grande, who represents 2,700 plaintiffs in a class-action lawsuit against DHHL that received the favorable Supreme Court ruling this year. “It's serving Native Hawaiians who are middle class or upper middle class. It does nothing for Hawaiians who are working poor or homeless."

Native Hawaiians are overrepresented in the homeless population. In a survey earlier this year of roughly 1,200 unsheltered homeless on Oahu, 1 in 5 was eligible for the homesteading program and 7% were on the waitlist.

Louisa Keawe, 60, applied for the homesteading program in 2010. Today, she lives in a tent at Waimanalo Beach Park on Oahu's windward side. The former janitor says she has been homeless off and on for about seven years and hasn't worked for about a decade because of a disability. She survives on about $800 in monthly Social Security benefits and food stamps, and she recently purchased a new tent with her federal stimulus check.

Keawe said she has received several offering notices but didn't pursue them, believing she was unable to qualify for a mortgage. The system, she lamented, favors those with wealth.

“People doing well on the high level, the first level, they can pursue a place on Hawaiian Homes. The second level? Average. They will pursue. But for my case, I cannot pursue nothing," Keawe said. “They exclude people like myself."

Age can also be a limiting factor. The Star-Advertiser and ProPublica found that more than half of all waitlisters are over 60, an age when taking on a new mortgage could be a stretch. The news organizations interviewed more than a dozen people who applied decades ago and are now approaching retirement age.

Oahu resident Gregory Ah Yat has been a renter all his adult life. He applied for the homesteading program 33 years ago but, like Keawe, passed on several lease offerings, either because he couldn't afford them or he didn't like the location. A longtime tour bus driver, he lost his job when the coronavirus pandemic shut down Hawaii's tourism industry in March.

Now 68, Ah Yat has little hope of getting a homestead. “I'm going to die before that happens," he said. “I'll never be able to make the payments, not even in 30 years."

“Handout" or Hand Up?

DHHL says it offers a variety of programs aimed at helping low-income beneficiaries become homesteaders. The services range from homebuyer education classes and financial literacy training to more direct financial aid.

Much of the funding comes from the U.S. Department of Housing and Urban Development, which has provided more than $150 million to the state agency over the past two decades. But that help has reached just a fraction of waitlisters.

Since 2002, more than 2,000 individuals and families have received homebuyer training and other assistance, according to Ryan Okahara, director of HUD's Honolulu field office. In addition, about 600 waitlisters got financial aid to purchase — or build — homes on trust land.

Those making 80% or less of an area's median income are eligible to tap the federal funds to obtain a zero-interest loan or down-payment assistance. On Oahu, that income limit translates to $67,500 for an individual and $96,400 for a family of four.

Shannon Chow applied for financial help several years ago. As an airline employee supporting a family of four, she qualified for a zero-interest loan from DHHL. The agency approved $267,000, which the 49-year-old Chow used to build a home on a vacant lot in Waimanalo, a historically Native Hawaiian community.

But, in a sign of how slow the homesteading process works, she didn't get her lease based on her position on the waitlist, which was more than 4,500 from the top. She inherited it in 2018 when her mother, Cecilia Chow, died at age 70 that year. Cecilia had waited more than 30 years before getting her lease.

With the loan from DHHL, as well as assistance from Honolulu Habitat for Humanity, Shannon Chow constructed a 1,200-square-foot, four-bedroom, two-bathroom house on the site.

At the July ceremony in which she received the keys to her new residence, Habitat for Humanity placed an empty chair with a lei draped over it as a tribute to her late mother. Chow dabbed back tears as she glanced at the empty chair next to her, wishing her mother was there. “We're always thinking of her," Chow said after the ceremony. “It's because of her we got this house."

Blossom Feiteira, a Maui beneficiary who heads a waitlister group and used to teach financial literacy classes, said even homeless applicants can become homesteaders if they take advantage of the services and are willing to do what is necessary, such as improve their credit standing, to prepare for homeownership. “This is not supposed to be a handout," she said. “It's supposed to be a hand up."

But other advocates say the programs are of little use to many struggling waitlisters. For example, those who receive the opportunity to get a lease with a turnkey home typically have to prequalify for a mortgage within 45 days. That isn't enough time for most low-income waitlisters to get their finances in order, said Jeff Gilbreath, director of lending for the nonprofit Hawaii Community Lending, which serves beneficiaries. Vacant lots that the beneficiary builds on — like Chow did — can be an alternative, but they come with their own challenges, including securing a construction loan and managing contractors, he said.

Gilbreath estimates that even with federal and state assistance, it can take up to a year and a half for low-income beneficiaries working with his nonprofit to address credit issues and build the savings necessary to buy a homestead. And the assistance programs are severely underfunded.

Gilbreath said low-income waitlisters can seek mortgage assistance from a federal program, known as the Section 502 Direct Loan program, but applicants are competing against other people every year. In some cases, the program's annual congressional allocation runs out before the end of the year, causing delays in aid. Beneficiaries who attempt to navigate the convoluted system can get discouraged and give up, Gilbreath said.

Success stories, he added, are “more the exception than the rule."

Funding Shortfalls, Slowed Construction

Aila acknowledged that his agency is not delivering homesteads in a prompt and efficient manner. The fundamental reason, he said, is inadequate funding. “Everybody agrees that is the problem. The Legislature agrees, the federal government agrees, we agree, the beneficiaries agree."

The pace of construction started to slow substantially in the late 2000s as the agency battled allegations of mismanagement and dealt with funding shortfalls. To maintain operations, officials diverted money from construction to administrative costs. That resulted in fewer new lots produced and awards offered. In three of the past five years, residential awards fell into the single digits, according to the news organizations' analysis. In 2018, only six such leases were awarded.

While the Hawaii Supreme Court ruled in 2012 that the state is constitutionally required to provide sufficient funding for the agency, the governor approved only about a fifth of the annual amounts DHHL has requested since then, department data shows.

Gov. David Ige did not respond to interview requests for this story, but he provided a written statement. While he did not directly address DHHL funding, he said budget requests submitted to his office from state agencies are based on what they believe to be sufficient funding. Still, they often “are three to four times or more than the resources available to us. As governor, I must prioritize and balance budget requests with available resources."

State Rep. Sylvia Luke, who heads the House Finance Committee, noted that the Legislature over the past eight years appropriated close to what the governor sought for the homesteading agency. Even though the amounts were less than what the department requested, they still were substantially more than what it had received historically.

“It's so convenient just to blame it on funding," she said.

Construction has picked up in recent years, and DHHL expects to offer hundreds of residential leases in subdivisions across three islands over the next few years. In December, the agency plans to hold a virtual meeting for 37 new turnkey homes in Kapolei. Prices range between $246,000 and $384,000.

But no subsidized assistance is available to help low-income waitlisters purchase the homes; instead, the agency is focusing on providing assistance for home construction on vacant lots, an option typically more affordable to those with fewer resources. Beneficiaries selected for the Kapolei houses would have to get financing through a conventional lender.

Scrapping the Model

Some beneficiaries, advocates and political leaders say DHHL needs to scrap the subdivision model and craft a new one better in tune with the needs of waitlisters.

“The situation with DHHL I don't think is a consequence of incompetence or skullduggery or indifference or even mediocrity," said former Gov. Neil Abercrombie, who served from 2010 to 2014. “There's elements of that in everything, no question. But principally it is that the model simply doesn't serve the purpose. It was difficult right from the beginning, and it's become impossible now."

The Star-Advertiser and ProPublica analysis found it would take DHHL nearly two centuries to meet existing demand if it continues to develop at the current rate. “Good grief," said U.S. Sen. Mazie Hirono, a Democrat from Hawaii, in response to the findings. “That's why they can't keep using that model." She believes state legislators should hold hearings to probe the homesteading program.

On Oahu, where residential demand is greatest, the focus should be more on condominiums and other housing more affordable to waitlisters, critics say.

“Otherwise, the 100 years of failure will continue," said Iwalani Laybon-McBrayer, a Kapolei homesteader and chair of the beneficiary-owned Homestead Housing Authority, a nonprofit that advocates for construction projects on trust land.

But not all beneficiaries agree. Homesteaders like Miyazaki are happy with the program. This year marks the 10th anniversary of her lease award for a two-bedroom house in Kapolei. “I love it, considering my mortgage is less than most people's rent," said Miyazaki, whose payments are $1,200 a month. “It feels really good to own a house."

Aila says DHHL is dedicated to its current housing model, particularly given the surveys conducted by the department showing most waitlisters still want single-family homes on standard lots, which are around 5,000 square feet.

When DHHL developed duplexes in the early 2000s near Papakolea, a homestead community just minutes from downtown Oahu, it had to go deep into the waitlist to find 86 buyers, including some who had applied less than two years earlier. The units sold for an average price, adjusted for inflation, of about $291,000.

That said, DHHL officials say they are responding to the calls for more affordable options for waitlisters. Since 2014, in reaction to beneficiary demands, the agency has revised its rules to allow for a wider array of housing choices, including tiny homes and multifamily dwellings.

Over the next five years, the department expects to develop a minimum of 1,300 lots — double the average rate over the past 25 years — for a variety of uses, including farming. About half will be for single-family homes, with most of the offerings in new subdivisions. The department also recently announced the selection of a developer for its first high-rise project, a 23-story building with 270 rental units in urban Honolulu. The units aren't expected to come on line until mid-2024.

Older waitlisters say the changes, while welcomed, come too late for them. And critics say the moves are not nearly enough for low-income Hawaiians because the agency still relies too much on single-family turnkey housing — a model that's at odds with the intent of the Hawaiian Homes Commission Act.

Carl Varady has seen the harm. As an attorney, he has worked with Grande representing 2,700 plaintiffs in the class-action lawsuit against DHHL. After 21 years and a string of legal victories, the beneficiaries are still waiting for compensation. About 400 have died since the suit was filed in 1999.

“Without people really looking at the purpose of this statute and living up to the fiduciary obligation," Varady said, “there will be another generation of Hawaiians marginalized, living on the beach, and waiting for something they should have gotten decades ago."

'Trumpcare' doesn't exist. That doesn't stop Big Tech from cashing in on ads for 'garbage' health insurance

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“Trumpcare" insurance will “finally fix healthcare," said an advertisement on Facebook.

A Google ad urged people to “Enroll in Trumpcare plans. Healthcare changes are coming."

The problem is, there's no such thing as “Trumpcare."

Facebook and Google have promised to crack down on lies and misinformation about politics in the run-up to next month's presidential election, but they have run tens of thousands of ads in the past year containing false claims about health insurance reform and plans.

The “Trumpcare" ads don't appear to have a political aim and don't advocate for the reelection of President Donald Trump over former Vice President Joe Biden. Nonetheless, the Facebook ads touting these nonexistent products have been viewed some 22 million times in the past year, disproportionately in battleground states like Texas, Florida, Georgia, North Carolina, Ohio and Pennsylvania, according to Facebook data.

The ads are placed by marketers targeting consumers — politically conservative ones in some cases — who become sales leads if they respond. Then the consumers get deluged with phone calls from brokers hawking health insurance plans that are not the comprehensive solution that's often promised, but instead are less conventional products that have traditionally been used as supplemental coverage or for when people transition between jobs.

The Affordable Care Act requires traditional health insurance plans to provide “minimal essential coverage," which includes preventive care, mental health care, substance abuse, maternity and more. The less-conventional plans are exempted from those requirements. Some of the plans are offered by name-brand companies like UnitedHealthcare, but critics say they're typically big moneymakers for the companies that can leave patients with unexpected medical bills. The plans' limitations often are not explained in the advertisements or in brokers' high-pressure sales presentations. Hundreds of complaints about the plans show up on consumer sites like the Better Business Bureau or Yelp.

“The marketing is extremely deceptive," said Sabrina Corlette, a research professor at Georgetown University's Center on Health Insurance Reforms. “Both the advertising and the brokers use terms that to the average consumer would make them think they are buying a comprehensive insurance plan that provides coverage if they get injured or sick. But quite often nothing could be further from the truth."

The misleading marketing may be ensnaring more consumers now, as an estimated 14 million Americans have lost employer-sponsored health benefits due to the COVID-19 pandemic.

Google and companies involved in the marketing generally defended the term “Trumpcare," saying it's legitimate to use to describe the president's general philosophy about health care or his 2017 executive order that allowed short-term insurance plans to cover a time period of up to 12 months rather than three months. Facebook said the word “Trumpcare" on its own didn't violate its rules. However, Facebook and Google both initially accepted “Trumpcare" ads that, after they were flagged by ProPublica, the companies later said did violate their rules.

A ProPublica reporter responded to one of the “Trumpcare" ads and took calls from five insurance brokers. The brokers seemed to have no idea what type of ad had led to the call. They were focused on closing the deal. One said, wrongly, that “Trumpcare" was just a new name for “Obamacare." The other four acknowledged that there's no such thing as “Trumpcare."

“It's fake news," said one.

“Trumpcare" “is not even in existence yet," said another.

“They're starting to change over from 'Obamacare' to 'Trumpcare,' but it hasn't switched over yet," a third broker said.

Traditional health care plans sold under the Affordable Care Act must comply with a host of regulations, including not discriminating against people with preexisting conditions. But the plans are expensive, and some consumers may not qualify for the income-based subsidies that reduce the cost. For example, a 40-year-old single person who makes more than $50,000 would likely not qualify for a subsidy to help pay for an individual health care plan, according to the Kaiser Family Foundation Health Insurance Marketplace Calculator.

The less conventional plans — called short-term, fixed indemnity, accident-only or specified disease plans — offered by the brokers are less expensive. Some provide benefits for a short term or give a fixed payment to cover a portion of a doctor or hospital bill. Others pay out only if the beneficiary had some type of accident. A purchaser would need to read the fine print to know what they did or did not cover.

ProPublica contacted the Federal Trade Commission and insurance regulators in all 50 states and found hit-and-miss enforcement of misleading ads and sales tactics. Some states, like Delaware and Virginia, have meted out discipline for using misleading tactics to sell the limited plans. But many have not. Most who spoke to ProPublica said they have no jurisdiction over the online “lead generation" advertisers. The regulators say it's like playing “whack-a-mole," as those caught using abusive marketing tactics can simply incorporate under a new name and resume the same behavior.

Online “Lead Generators" Lure in Consumers

Identifying deceptive tactics related to health care plans is as easy as going online and looking.

Southern California marketer Stuart Millar said he's placed “Trumpcare" advertisements to join in “the gold rush of online entrepreneurship."

Millar has spent at least $350,000 on 12,500 “Trumpcare" ads from four Facebook pages with “Trumpcare"-themed names since last October. “Thanks to our President," one of them said, “U.S. health insurance companies have had to drastically drop their rates." (ProPublica can see how much Millar spent because he had proactively marked his ads as political, triggering Facebook to disclose this information.)

Millar isn't an insurance broker — one of the people who sell insurance and are regulated by the states. He's a “traffic broker," a marketer in charge of running ads to drive visitors to his clients' websites. There's little regulation of his activities. His ads have focused so much on the term “Trumpcare," he said, because it's clickbait. He called it far more attention-getting than the “left-wing one," his term for “Obamacare."

“I've got to find a fun way to make health care interesting," Millar said. “'Trumpcare' is interesting but health care in general isn't."

“Traffic brokers," like any Facebook advertiser, can select the specific demographics of the Facebook users who will see their ads.

Millar declined to get into details about how he targeted his ads, but said he mostly relied on Facebook's algorithm to find him the people who'd click. He said he tested thousands of iterations of the ad to make sure it found an audience. “What I went with was what converted," Millar said, a reference to people responding to the ads.

Some “Trumpcare" ads — not apparently linked to Millar — have been targeted at people Facebook labels as “interested in Donald Trump," according to targeting data provided by Facebook to users along with ads that are shared with the Ad Observer project.

Millar says he didn't come up with the idea of using “Trumpcare." That came from his clients, whom he wouldn't name. Many of Millar's ads led to a page featuring a red, white and blue “Trumpcare" logo on, which is owned by a company called Apollo Interactive. (The company is not a nonprofit, but anyone can buy a .org website address.)

Apollo Interactive isn't an insurance broker either. It's what's called a lead broker, yet another cog in the lightly regulated machinery of insurance “lead generation" marketing. That means it gathers profiles of people who are looking for health insurance. Those who input their information on these sites become “leads." And then they're put up for auction.

Officials from Apollo Interactive wouldn't say how the company sells leads. But Colin Sholes, an activist and former online health insurance marketer, said lead generators extract an anonymized sample of each person's data: ZIP code, age, gender. This profile, without any contact information, gets shared with potential buyers, who bid for it in an instant, automated auction. The winning bidder or bidders get the person's name and their contact information.

Leads are often sold as “shared leads" — meaning they're sold to more than one buyer at the same time. Some of the buyers are insurance brokers. Some are other lead brokers who bid so they can resell data that originated elsewhere. “It's a big web and everybody's interconnected," Sholes said. “A lot of data just floats around."

So how much is each “lead" worth? Sholes estimated that a lead for a person under 55 would cost as much as $20.

The lead might be even more valuable if it was sold as what the industry calls a “warm lead," he explained. Some companies exist just to buy leads, then have a call center agent call and, if a human picks up, the agent “warms you up," Sholes said. That means they check to make sure the consumer is interested in buying insurance. At that point the company sells the call to an insurance broker as a “warm" transfer. “A connected call," he said, might sell for up to $80.

Millar confirmed he got paid by the lead, but he refused to say how much. He did say that he made a profit on what he paid Facebook to run the ads. He was not aware of what happens to consumers who click on his ads, then purchase the health plans. “I didn't ever call in myself. I am not exactly sure how any of that works."

Facebook and Google Profit From the Misinformation

This fall, someone Googling for affordable health insurance might have come across an ad that said: “Healthcare changes are coming. Check out the new pricing tiers under the American Health Care Act."

The American Health Care Act — the bill most commonly called “Trumpcare" — failed to pass the Senate in 2017 when the terminally ill Sen. John McCain dramatically walked across the chamber's floor and gave a thumbs down, leading to the bill's defeat. So there were no new “pricing tiers" on offer, as the ad claimed, in 2020.

Those ads led to Apollo's site. Apollo Interactive attorney Chris Deatherage said in a written statement that the Google ads “appear to be old ads" from when AHCA “was actively being discussed in the legislature."

Deatherage said “Trumpcare" is an “abstract" term used to “tie together" various pieces of intended or existing legislation and policies and that Apollo's “Trumpcare" website said the term refers to Trump's “collective policy updates." He compared it to “Obamacare" — which specifically refers to the Affordable Care Act — and proposals for “Medicare for All," which are not law. He added that Apollo Interactive's website lets visitors connect with brokers who can explain the term.

Google's rules say it does not allow ads that “deceive users by excluding relevant product information or providing misleading information." Facebook says it bans ads with “deceptive, false, or misleading claims." But both accepted the “Trumpcare" promotions. Google even gave the misinformation prime real estate, with the ads as the top-listed results when people search for affordable health insurance.

Christa Muldoon, a spokeswoman for Google said, “Health care ads cannot make misleading claims about the advertiser's identity or the services they offer." She said Google removed the ads referencing AHCA under that policy after ProPublica contacted Google about them. She wouldn't explain why the company apparently let the ads run for years, despite violating Google's rules.

Until last year, Google also sold ads that lured in consumers with the phrase — the federal government site where you can purchase plans that comply with the Affordable Care Act — even though they were for private, lead-generation websites.

It's not clear how much Google earned from selling “Trumpcare" ads. Unlike Facebook, Google doesn't consider ads about “Trumpcare" political, so it doesn't publish any data about them. Muldoon would not say how much Google made from the ads.

But, she said, citing Trump's executive orders on health care, “We do not consider the phrase 'Trumpcare' alone to be misleading," so it's allowed in Google ads.

A report a year ago from Sen. Bob Casey, a Pennsylvania Democrat, criticized Google and other search engines for showing ads for for-profit lead-generation sites listed above the official site when a person searched for “Obamacare" or even “" Casey called for search engines to put an “answer box" above all content, even ads, with a link to on searches for health insurance.

Muldoon hinted at a coming change to what kinds of health insurance-related ads the company will allow. She said that Google is “evaluating the health insurance space to strengthen our protections for users and prevent misleading ads."

After Newsweek flagged the Facebook ads in a blog post in August, the Lead Stories news organization published a fact-check saying that “there is no such thing as Trumpcare." That prompted Facebook to stop accepting the ads, under a policy that bans ads with content that fact-checkers have found to not be true.

Devon Kearns, a Facebook spokesperson, told ProPublica that some of the ads were removed for violating a Facebook policy that bans “scammy tactics."

But then in mid-September, more “Trumpcare" ads appeared on Facebook, from something called “National Center for Medical Records," which didn't return a request for comment. These ads led to another company's website, not Apollo's. One of them featured a smiling Trump with his arm around the shoulder of a doctor and the slogan: “Trumpcare from $1/Day."

Omissions and High-Pressure Sales

ProPublica wanted to learn more about the sales tactics involving “Trumpcare" ads, so we checked for ourselves. One of the reporters on this story, Jeremy, had been laid off in May. So he clicked on an ad in Facebook's ad transparency portal, featuring photos of a health insurance card and a tuxedoed Donald Trump with Melania Trump in a ballgown. It took him to, which prompted him to input his contact details, as well as his age, gender, address, income range and whether he had any “major medical conditions."

Jeremy is young and healthy, and he answered the questions honestly, so his information made him a hot prospect.

Jeremy entered a burner phone number that he acquired for this project — a good choice, because he got 67 phone calls the day he submitted the form; the day after, he got 46 more. The plans the brokers offered were legal, to the extent that they gave enough information to check. But to be informed, a consumer would want to know each plan's limits and exceptions and be provided with detailed information about what's covered, or not. The brokers often withheld crucial information.

Alex, from “the Enrollment Center," said his plan offered free preventive care and would let Jeremy pick his own doctor. Using the lingo of the Affordable Care Act he described the insurance as a “minimum essential coverage plan." But that's exactly what it was not. Jeremy, who is married with no children, had to ask if the plan covered maternity costs, something that might be relevant to a childless couple. Alex said that would require something else, a “major medical plan."

When Jeremy asked Alex to email the plan documents, so he could read what the plan covered or excluded, the line disconnected. Alex never called back.

When we called back several weeks later to ask for comment, the line was apparently disconnected.

Another company, “Modern Health," would not even provide a brochure about its health plans. A supervisor named Louis said he was “in charge of the company" and that it would be a violation of patient privacy laws to send information in writing about the plan. (It isn't.) Those details would supposedly have to come from the insurance company, and only after Jeremy signed up.

Anthony, who said he worked for the “National Health Enrollment Agency," also wouldn't send anything in writing. But his reason made it sound like he needed to lock in a fare on a flight that was rapidly running out of seats. “Once we disconnect the line, the companies aren't going to let me hold onto the plan," he said.

When Jeremy said he wanted to talk it over with his wife, Anthony countered: “Is she a licensed broker?" He offered to add her to the call rather than have the couple discuss it alone.

None of the salespeople volunteered the details a consumer would need to make an informed choice. Brandon, the salesman from Modern Health, for example, offered a plan from a company called “HealthShield." It's for “things like emergency surgeries, hospitalization, ambulances and prescriptions," he said. He went into painstaking detail about the amount it paid for certain items. But when asked if he'd shared everything Jeremy needed to know, he said, “It does have your essential package that a lot of people sign up for, especially at this time." Only later, when asked what category of insurance the plan fell under, did he say that “they do remove certain things, which include substance abuse, mental health and maternity benefits."

Reached for comment for this article, a man who said that his name was Brandon Greer and that he was now in charge of Modern Health said “I'm not sure" when asked if these omissions might confuse consumers. He said that the company instructs its salespeople to note the exclusions “upfront." He then ended the call.

When we tried to reach the National Health Enrollment Agency minutes later, to get a comment for this story, the phone rang at the offices of Modern Health. The person who picked up denied knowing what the National Health Enrollment Agency was and hung up when asked his name.

Omitting the details of health insurance plans can harm consumers. In August, the Government Accountability Office, the auditing and investigative unit of Congress, published a secret shopper investigation of the sales tactics for the plans. GAO investigators tested 31 brokers by using a fake persona, a person who had a preexisting condition. Eight of the 31 brokers made misstatements, the report says. One was selling the GAO investigator — who claimed to have diabetes — a health insurance plan that the broker said would cover the investigator's diabetes, but it really didn't. In a different case, the investigator told the broker that they had diabetes, but the application completed by the sales representative said there was no treatment or diagnosis for diabetes in the past five years. “This indicates that the broker may have intentionally falsified information," the report said.

The GAO didn't disclose the names of any of the brokers in its report, but it said it referred them to the Federal Trade Commission and state insurance regulators.

“Garbage" Insurance Generates Profit for Brokers and Insurance Companies

USHEALTH Advisors, one of the companies whose broker contacted Jeremy, posts videos online to show off how much money its brokers are making selling limited insurance plans.

“How much can you earn monthly at US Health Advisors?" asks one of the videos, posted by US Health Advisors Coral Springs.

“$16,000," says a bearded man in a black shirt and tie.

“$18,000," says a woman in a sleeveless top.

“$34,000," says a man in a dress shirt and tie, a family photo in the background behind him.

Then, the closer: “$42,000 — in one month," a man says.

Justin Brain, the USHEALTH benefits specialist whose number is on the US Health Advisors Coral Springs Facebook page, said commissions vary depending on a broker's “production," or sales totals. He declined to say how much the commissions were per sale, but he said the video is used for bringing in new sales recruits to “give them what's possible."

An April study by the Urban Institute found brokers making commissions of around 25% for the type of plans offered by the company. Other insurance brokers told ProPublica the commissions on some plans could be as much as 50%.

The video closes with a USHEALTH Advisors logo that adds, “A UnitedHealthcare Company." UnitedHealthcare is a massive company that provides health insurance and benefits. It's part of UnitedHealth Group, one of the largest companies in the country, with $242 billion in annual revenue in 2019. UnitedHealthcare declined to say how much the brokers made in commissions.

A USHEALTH broker pitched Jeremy a plan sponsored by Freedom Life Insurance Company of America, which is also a UnitedHealthcare company. The broker characterized the coverage as similar to Affordable Care Act plans and sent a 36-page brochure that laid out the details of the offer.

The document he sent made it clear that the Freedom Life plan would provide limited coverage that could leave a person with hefty bills. But it would take an exceptionally savvy consumer to sort through dozens of pages of insurance jargon to understand that. At ProPublica's request, Jeffrey Hogan, the Northeast regional manager for Rogers Benefit Group, a national benefits marketing firm, examined the document.

Hogan pointed out that it disclosed on Page 3 that the plans would “supplement" any “essential health benefit plan," meaning one of the more comprehensive plans sold under the Affordable Care Act. If this plan was meant as a supplement, then it would not be ideal for an uninsured couple. This was not mentioned in Jeremy's sales presentation from the Freedom Life broker.

One portion of the plan listed its “maximum" benefit for various “defined" sicknesses. It did not say what its “minimum" payment might be. The daily maximum paid under the plan for an X-ray would be $50. For a CAT scan it would be $200. For an outpatient lab it would be $30. Each of those procedures could cost many hundreds of dollars more than the maximum benefit.

Hogan called the plan a “cascading mess" of coverage for specific conditions. “I wouldn't sell this stuff if it was the last piece of garbage on earth," Hogan said.

The limited benefit, accident or defined benefit plans like the ones offered by Freedom Life are highly profitable for the companies that operate them, Hogan said. “They pay very little out on the dollar," he said.

In 2019, Freedom Life took in $171 million for Accident and Health policies covering about 291,000 people, according to a report by the National Association of Insurance Commissioners. Its “loss ratio" was 46%, the report said, which means Freedom Life spent less than half of what it brought in from premiums on medical claims and funding its reserves. That leaves plenty of revenue for profit and to pay commissions and fees to brokers and lead generators.

By comparison, the plans sold under the Affordable Care Act have a minimum loss ratio of 80% to 85%, meaning 80 to 85 cents of every dollar must be spent on medical care for the people paying premiums. If companies spend less, they are required to refund the difference to consumers or employers.

Hogan said that he's been selling insurance for 35 years and that it wasn't easy for him to sift through all the jargon and limits and caveats about coverage in the Freedom Life document. One of the most insidious details was “buried" on Page 22, Hogan said. That's where the company disclosed that any cost incurred as a result of a preexisting health condition would not be covered under the short-term plan included in the package. “This just makes my blood boil," Hogan said. “This hurts people."

Maria Gordon-Shydlo, a spokeswoman for UnitedHealthcare, said in an email the plans provided by USHEALTH provide “valuable health coverage options to meet people's individual financial and care needs." Its brokers present various options, including Affordable Care Act plans, to help people find the plan that's best for them, she said.

Jorie Jacobi, a 31-year-old from St. Louis, signed up for a plan through Freedom Life Insurance in 2018 when she was working as a freelance writer. She searched for affordable health insurance on Google and put in her phone number on a website that promised she'd receive quotes. She got inundated with phone calls that went on for more than a year.

Jacobi is relatively healthy, so she figured she didn't need to pay for the more comprehensive, higher-priced plans offered under the Affordable Care Act. She spoke to a USHEALTH agent selling Freedom Life and said she was under the impression at the time that the package of limited health plans provided by Freedom Life would make sense for her. Her monthly premium came to $224 — not cheap, she said.

Jacobi admits that she didn't do her due diligence when she signed up for the coverage. “I feel silly about this now, but I just trusted them," Jacobi said. She doesn't remember her exact conversations with the agent, and UnitedHealthcare said that there are no recordings of the sales calls, and that it would not provide a recording or transcript of a follow-up call. Jacobi insisted that she would have made sure she had coverage for routine visits to her internist and obstetrician-gynecologist, but after she went to the doctors she received bills for lab work that came to $311 and $710.

After about a dozen hours on the phone with Freedom Life's customer service representatives, Jacobi said the bills still hadn't been paid. So she wrote a negative review on Yelp. That led to a phone call from a company vice president who helped make sure the insurer paid the bills.

In another case, the Freedom Life plan did not cover a drug Jacobi needed. And when she needed a minor surgical procedure she learned it would not be covered by the plan, so she paid cash.

Gordon-Shydlo, the UnitedHealthcare spokeswoman, said Jacobi had selected coverage that had a lower premium but only covered specific diseases, accidents and other items. The insurer complied with its “stringent application process" and addressed Jacobi's questions and correctly paid her claims, Gordon-Shydlo said.

Jacobi is now covered by a health plan sponsored by her employer. She regrets getting caught up with Freedom Life. “It makes you feel really stupid that you fell for it," she said.

Regulators Play “Whack-a-Mole"

Frank Pyle has been chasing junk insurance companies for years as the director of market conduct enforcement for the Delaware Department of Insurance. “As soon as you take one down another one pops up in its place."

Pyle said regulators across the country are aware of misrepresentations by insurers selling limited, short term, accident and defined sickness plans.

Pyle and his team in Delaware have to get throwaway phones when they play secret shopper on the lead generating websites, because the lines get inundated with so many calls from brokers.

In one investigation, Pyle said his team listened to a random sample of 87 recorded sales calls from a particular company. At least half of them contained some form of deception, he said. The level of misrepresentation seemed to depend on the savviness of the consumer, he said. A consumer would ask if the limited plan was the same as an Obamacare plan and the broker would tell them it's just as good. If the consumer asked if the plan covered diabetes, the broker would tell them it did when it didn't, he said. The case resulted in a fine against the company, he said.

When some states identify violations, they impose weighty penalties, like fines or revoking the license of a broker. But in others the penalties are light or sometimes limited to warnings.

Numerousstateinsurance commissioners have warned consumers to “be wary of telemarketers from the 'national enrollment center,' 'national healthcare center,' or other official-sounding names."

The Virginia State Corporation Commission settled a case for $6,300 with Freedom Life that alleged the company misrepresented benefits or terms of a policy with advertising that was “untrue, deceptive or misleading" and failed to give applicants a summary of their rights. The company agreed to a corrective action plan that addressed the alleged violations, documents show. Gordon-Shydlo, the spokeswoman for UnitedHealthcare, which owns Freedom Life, said in an email that the company's brochures included notices about the limitations of the products and that the company did not admit to any violation of the law.

It was hard to find state regulatory agencies that had taken action against lead generating companies. One state insurance regulator, who spoke anonymously because he didn't want his colleagues to be criticized, said his agency “probably" has the authority to regulate the lead generators, because they are engaged in selling or soliciting the sale of insurance. “But it's something we haven't done in the past," the regulator said. “It's something that hasn't been the best use of our time."

New Mexico's superintendent of insurance issued an official warning, saying it intended to hold insurance brokers and companies responsible for “abusive marketing practices by lead generators." It also said the kinds of sales tactics used by brokers — such as referring to limited plans with terms associated with “Obamacare" plans — were misleading and deceptive, and banned them.

Corlette, the Georgetown insurance expert, said the Federal Trade Commission could take a “more aggressive" look at deceptive advertising and lead generating. An FTC spokeswoman said in an email that the agency is “concerned with illegal lead generation across the board," but could point to only five enforcement actions that related to the deceptive marketing of health care plans. Only one of the cases took place within the past five years. None involved Millar or Apollo Interactive.

The FTC's jurisdiction includes almost any sales claim that is “unfair" or is misleading and would affect a consumer's decision to buy, says Aaron Rieke, a former FTC staff attorney. Because the agency is “super understaffed for their jurisdiction," he said, its attorneys aim to take enforcement actions that yield real systemic improvement for consumers. But the fact that the lead-generation ecosystem includes many small players who buy ads on Google, Facebook and elsewhere presents a “structural challenge" — because “swatting [them] down doesn't feel like a very effective way to go."

Pyle said the state regulators should hold the insurance companies responsible for their advertising tactics, including the actions of lead generators. In 2016, the Delaware Department of Insurance fined Companion Life Insurance Company $487,000 for violations that included “deceptive acts," documents show. Many of the problems in the case came from the lead generators the insurer was paying to do the outreach to consumers, Pyle said.

A person in the Companion Life compliance department referred ProPublica to its parent organization, BlueCross BlueShield of South Carolina. But no one returned requests for comment.

Pyle said he's troubled that legitimate insurance giants own some of what he calls the “bad companies." “I'll be honest with you," he said. “I am surprised UnitedHealthcare is involved as much as it is."

Pyle said regulators from various states have regular meetings and are considering pursuing criminal action against insurance company executives. “If the insurance company is paying someone to work on their behalf, they are responsible for their actions," Pyle said. “You can fine these companies and they consider it the cost of doing business. But if you lock up their CEO in federal prison, they'll think twice about harming our consumers."

Pennsylvania’s rejection of 372,000 ballot applications bewilders voters and strains election staff

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Pennsylvania, one of the most hotly contested battlegrounds in the presidential election, has rejected 372,000 requests for mail-in ballots, straining election offices and bewildering voters.

More than 90% of those applications, or about 336,000, were denied as duplicates, primarily because people who had requested mail-in ballots for the state's June 2 primary did not realize that they had checked a box to be sent ballots for the general election, too. Voters have also been baffled by unclear or inaccurate information on the state's ballot-tracking website, and by a wave of mail ballot applications from political parties and get-out-the-vote groups. County offices across the state have been forced to hire temporary staff and work seven days a week to cope with the confusion.

“The volume of calls we have been getting has been overwhelming," said Marybeth Kuznik, elections director in Armstrong County, northeast of Pittsburgh. It's been preventing her office from working on anything else: “It has been almost like a denial of service attack at times because it seemed that sometimes all I could get done was answer the phone!"

Though it may deter some people from voting, the mass rejection of ballot applications is unlikely to have a big effect on turnout. Voters who submitted duplicate applications should eventually receive a ballot. Those who don't can still vote at the polls on Election Day.

Overall, one out of every five requests for a mail-in ballot are being rejected in Pennsylvania. An estimated 208,000 Pennsylvania voters sent in the spurned requests, some submitting them multiple times. Although the state's email rejecting the requests describes them as duplicates, it doesn't explain why, prompting some people to reapply. ProPublica and The Philadelphia Inquirer identified hundreds of voters who submitted three or more duplicate applications; one voter appears to have submitted 11 duplicates.

The administrative nightmare highlights the difficulty of ramping up vote-by-mail on the fly without enough voter education. Last year, Pennsylvania passed a law that removed the state's tight restrictions on mail ballots and enabled any registered voter to receive a ballot without giving a reason such as travel or ill health. In 2018, only 4% of votes in Pennsylvania were cast by mail. In the June primary, with the pandemic discouraging many people from voting in person, that percentage rose to just over half.

“States that have large numbers of successful mail voters, pre-pandemic, have educated their voters about this process over decades, and Pennsylvania is trying to do this in a matter of months," said David Becker, founder and executive director of Center for Election Innovation & Research in Washington.

Nongovernmental groups have inundated Pennsylvania voters with mail-in ballot applications, making it easy to request ballots — and contributing to the flood of duplicates. Voters often believe these unsolicited and sometimes inaccurate applications come directly from elections offices. Some voters are filling them out even if they've previously submitted a ballot application.

These groups have created “confusion for voters and the likelihood that voters will not realize their application has been processed and they don't need to submit another one," said the Pennsylvania Department of State, which oversees elections. It added that “some voters may have forgotten that they opted to be put on the annual mail ballot list when they applied for a ballot for the June primary."

Counties big and small across Pennsylvania have been deluged with duplicate requests. Officials in Allegheny County, which includes Pittsburgh, have rejected more than 49,000 duplicate ballot requests from the June primary to October 14. Armstrong has rejected 25% of its 5,400 applications as duplicates. Chester County, in the Philadelphia suburbs, has processed 113,000 applications, and about one in five have been duplicates. Neighboring Montgomery County has rejected 32,000 of its 174,000 applications, or 18%, as duplicates. Philadelphia has denied nearly 49,000 duplicate applications.

Workers must handle every application individually. “We basically have to treat them all the same," said Bill Turner, acting elections director for Chester County. “We're taking a tremendous amount of staff time and effort only to find out it's a duplicate."

The rejections engender mistrust in already-anxious voters. Craig Sewall, 33, a registered Democrat and a Ph.D. student in social work at the University of Pittsburgh, got an email from the state this summer inviting him to apply for a mail-in ballot for the general election. He had voted by mail in the primary and was “very motivated to vote" in the presidential election, he said. So he followed the email's prompts and applied for a ballot online.

A few weeks after requesting a ballot, Sewall received an email from the state. “Your application was declined because of the following reason: DECL - DUPLICATE APPLICATION," the email read. It advised him to call the Allegheny County Board of Elections if he had any questions. But when he called, he said, the office was too busy to answer his questions. “I've been fairly persistent and I'm pretty disillusioned," he said.

The mix-up led Sewall and his wife, who followed the same steps but received a ballot, to reconsider voting by mail. “We're still not sure, we might just end up surrendering our ballot and voting in person just to make sure," he said.

Amie Downs, an Allegheny County spokesperson, acknowledged that the problem has strained staff. “We continue to try to speak with everyone," she said. “Even with the addition of extra telephone lines, a queue and the assistance of our call center, callers are still having difficulty getting through."

In retrospect, Sewall said, he thinks he checked the box on his application for the primary ballot to receive one for the general election. Doing so would have placed him on a “permanent list" that voters can opt into as part of the new law. When applying for mail ballots, voters can check a box to vote by mail in every election that year, as well as to automatically receive an application form annually.

“Because becoming a permanent mail-in voter is new, this is the first time that they would automatically receive a ballot without having to apply for it," said Sarah Seymour, elections director in central Pennsylvania's Blair County, where more than one in four applications is a duplicate. “They're unsure, so they're sending in another application."

Frustrated voters like Sewall are contacting election offices by the thousands. Montgomery County last week received 5,000 calls a day — more than 911 receives during a hurricane, according to Lee Soltysiak, the county's chief operating officer and clerk of its elections board. Philadelphia has had so many calls it started outsourcing them to the city's 311 call center. On several days in the last week, Allegheny County has seen more than 7,000 calls a day.

“The phones don't stop ringing," said Tim Benyo, chief clerk for Lehigh County elections. “They ring through the night and on weekends."

At one point this summer, Allegheny officials were processing mail-in ballot applications 24 hours a day, with a peak of 125 workers. On some recent days, 40-50% of ballot applications in the county are duplicates. The county has experienced other snafus as well. On Wednesday, it announced that, because of a printing error, it had sent incorrect ballots to 28,879 voters.

Adding to the confusion, voters and election officials say that the state's online application and ballot-tracking system sometimes has inaccurate or outdated information, because it relies on counties' goodwill to keep it current. “The state website ballot tracker, polling place locator, and find your voter registration tools are not working correctly all of the time, leaving voters to call to verify information that they should be able to find online," said Downs, of Allegheny County.

The Department of State said that “depending on when and how the counties update the ballot and mailing information" in the state systems, “the mail-in ballot tracker on may not reflect precise information." The department added that it is working with counties to ensure that voters get the correct information: “As more ballots are mailed in the coming days and weeks, the tracker will more accurately reflect each county's activity and the status of individual voters' ballots."

Months of baseless attacks by President Donald Trump that mail voting is susceptible to widespread fraud have soured many Republican voters on using the method and created a large partisan divide. Of Pennsylvania's approved ballot applications as of Wednesday, more than 948,000 have come from Democrats, 343,000 from Republicans, and 241,000 from independent and third-party voters.

Pennsylvania last year began allowing voters to apply online for mail-in ballots, but the state system doesn't notify voters that they are submitting a duplicate. The online form links to a tool where voters can check their registration status, but it doesn't link to the tool where they can check their vote-by-mail status.

That ballot-tracker tool is itself confusing. Voters whose applications have not yet been approved do not show up in the system — instead, the site says “record not found." Voters who have been approved to receive a mail-in ballot have their status listed as “pending," without further explanation.

“There's nothing on the website that tells a voter that 'pending' means you've been approved but your ballot hasn't been sent out yet," said Christine Reuther, a council member in Delaware County in suburban Philadelphia. “I mean, I wouldn't know that's what pending means."

Another consistent problem: the terse rejection email sent to voters. The email, like the website, should be clearer, county officials said.

“They could explain what that means. A duplicate: you have applied before, we already have an application on file for you. Sit back, relax, it's going to be coming in the mail," Soltysiak said.

A longtime voter in his 60s in the Pittsburgh area, who asked to remain anonymous to protect his privacy, was rejected three times because of duplicate applications. He kept applying, he said, because he never heard back from his local election office. He called the office “a zillion times, but no one ever answered," he said.

This summer, he received a mailer from an official-sounding voting organization that listed a “Jr." after his name. He has never used a Jr. suffix, and he worried that using that ballot application would disqualify his vote. “I have no interest in having more than one ballot," he said.

The voter was able to get an explanation about his mail-in ballot applications only after a local election official fixed a problem with his voter registration — his first such problem in nearly 30 years of voting in Allegheny County. “I have never seen such a mess with the county government in my life," he said.

By that time, voting by mail was too much trouble. “I gave up and I'm voting in person," the voter said. “I figured the hell with it, I'm done."

Who decides when vaccine studies are done? These internal documents show Fauci plays a key role

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Dr. Anthony Fauci, the nation's top infectious disease official, will oversee most of the ongoing COVID-19 vaccine trials in the U.S., but not that of the current front-runner made by Pfizer, documents obtained by ProPublica show.

According to a draft charter spelling out how most of the advanced COVID-19 vaccine trials will be monitored, Fauci is the “designated senior representative" of the U.S. government who will be part of the first look at the results. That puts Fauci in the room with the companies — including Moderna, Johnson & Johnson and AstraZeneca — in deciding whether the vaccines are ready to seek approval from the Food and Drug Administration.

Fauci's role, which has not been previously reported and was confirmed for ProPublica by the National Institutes of Health, could offer some reassurance in the face of widespread concerns that President Donald Trump wants to rush through an unproven vaccine. As Sen. Kamala Harris, the Democratic nominee for vice president, put it at last week's debate, “If the public health professionals, if Dr. Fauci, if the doctors tell us that we should take it, I'll be the first in line to take it."

But there's a big caveat. Fauci doesn't have the same hands-on role for the vaccine that seems poised to show results soonest: Pfizer's. That's because Pfizer opted not to accept government funding and participate in the federal program to develop a coronavirus vaccine, known as Operation Warp Speed. (The government did make an almost $2 billion deal with Pfizer to preorder up to 600 million doses of the company's vaccine, but it isn't contributing money to the vaccine's development like it is for other companies.)

“(We) offered opportunities for collaboration with Pfizer," said a spokesperson for the National Institutes of Allergy and Infectious Diseases, a branch of the NIH. “Pfizer chose to conduct their Phase 3 study without Operation Warp Speed or NIH support."

Pfizer's CEO, Albert Bourla, said Friday that the earliest his company would be ready to apply for authorization would be the third week of November. While Pfizer might know by the end of October if its vaccine is effective, it would need additional time to gather sufficient safety data to present to the FDA, Bourla said in an open letter on the company's website.

Fauci's role in overseeing the companies that are participating in Operation Warp Speed arises from a unique arrangement that the government set up to monitor the trials. Typically, clinical trials set up their own independent panels of scientists, known as a data safety monitoring board or DSMB, to watch out for safety concerns or early signs of success. But all of the vaccine trials in Operation Warp Speed are sharing a common DSMB whose members were selected by Fauci's agency, the NIAID. They're also sharing a network of clinical trial sites where some volunteers are recruited for the studies.

A DSMB is responsible for making recommendations such as halting the trial if there is a safety concern or letting the manufacturer know that there's enough evidence to submit an application to the FDA. Ordinarily, a DSMB's recommendation goes to the company running the trial. In this case, the U.S. government — which gets two representatives, one from the NIAID and one from the Biomedical Advanced Research and Development Authority — will also have a seat at the table in deciding what to do next.

“Once the DSMB makes a decision, the DSMB provides the recommendation to not only the study sponsor but also to the" U.S. government, whose “designated senior representative" is Fauci, the NIAID confirmed in an email. Fauci declined to be interviewed.

That's not the same as saying Fauci has the last word. The company and the government are supposed to reach a consensus, the agency said. But if they can't all agree, the ultimate decision belongs with the company.

Still, it would be an improbably brazen move for a company to move ahead over Fauci's objection, given his public stature, experts said. “These are the most important trials in medical history, this is the ultimate fishbowl," said Dr. Eric Topol, director of the Scripps Research Translational Institute. “I don't think any sponsor would dare defy the DSMB's recommendation."

While the mechanics of a DSMB may be unfamiliar to most members of the public, people probably know and trust Fauci, according to Amy Pisani, executive director of the national nonprofit organization Vaccinate Your Family. “(He's) the sweetheart of the nation right now," Pisani said. “I do think people have faith in Anthony Fauci."

“Having Fauci with oversight is terrific," Topol added. “The more people who are experts looking at it, the better. You can't be careful enough."

Other members of the DSMB for the COVID-19 vaccines, though not as well known as Fauci, are also widely respected in their fields. DSMB members are typically kept confidential to shield them from outside influence, but ProPublica has been able to identify a few members. The charter obtained by ProPublica described the group, which has about a dozen members, as having expertise in “biostatistics, clinical trials, infectious diseases, vaccine development and ethics."

The panel's chair is Dr. Richard Whitley, a professor of pediatrics, microbiology, medicine and neurosurgery at the University of Alabama at Birmingham. His role became public when the university announced it, though the webpage was later taken down.

His leadership provides another level of comfort in the trustworthiness of the trials to those who know him. “He is not only famously bright but he is famously independent and outspoken," said Dr. William Schaffner, professor of preventive medicine and infectious diseases at Vanderbilt Medicine. “He'll look at the data and tell you exactly what he thinks."

Whitley declined to comment.

Susan Ellenberg, professor of biostatistics at the University of Pennsylvania and a former director at the FDA, told ProPublica in an interview that many people, including herself, were worried the NIH might be “pushed by the political leadership at HHS to release data" from trials prematurely, which could undermine the integrity of a trial. HHS, the U.S. Department of Health and Human Services, is the NIH's parent agency. Her concern was that political leaders might not understand scientific arguments to not disrupt the trials when wanting to have data “to be able to move quickly in an urgent situation," she said.

At the time of the interview, Ellenberg had not identified herself as a member of the NIH's DSMB, but later acknowledged that she was a member.

Dr. Malegapuru William Makgoba, an immunologist based in South Africa, is one of a few international members of the DSMB. Makgoba is well known for his work on public health initiatives around HIV/AIDS, including the South African AIDS Vaccine Initiative. Makgoba confirmed his role on the DSMB but declined to comment further.

The common DSMB appears to be unprecedented, if only because there have not previously been multiple vaccines in development for the same disease at the same time. Experts said the arrangement offers benefits such as bolstering the evidence available to show that any one shot is safe and effective.

Standardizing trial measurements should make the vaccines easier to compare head to head, which may be useful for knowing whether one is better or worse than another in certain subgroups, such as the elderly or people with compromised immune systems, according to Vanderbilt's Schaffner.

“To me, it's better for public health to have a fairly common assessment," said Dr. Gregory Glenn, president of research and development at Novavax, which has received $1.6 billion from Operation Warp Speed and hopes to begin its Phase 3 trial in the U.S. this month as part of the NIH's clinical trial network.

There may also be some benefits from a safety perspective.

If a potential safety issue appears in one trial, having a common data safety monitoring board for multiple trials means that the board knows to look out for that same issue across all the trials, said Dr. Tal Zaks, chief medical officer of Moderna. “When AstraZeneca had an adverse side effect, we have a DSMB looking at our trial — the fact that it's the same DSMB means that there's not one DSMB that has to go educate another DSMB," Zaks said. (ProPublica's board chairman, Paul Sagan, is a member of Moderna's board and a company stockholder.)

AstraZeneca's trial has been put on hold in the U.S. while the company and the FDA investigates what happened with a participant who had a bad reaction. It's not yet clear whether the reaction was due to the vaccine or unrelated.

“AstraZeneca is committed to working with governments and key partners to ensure we develop and gain regulatory approval for an effective vaccine as quickly as possible," the company said in a statement.

AstraZeneca added that another benefit of joining the government's consortium was that its large network of trial sites can help reach minority communities that are historically less represented in clinical trials and also more vulnerable to COVID-19.

Pfizer's decision not to participate means that it and the other companies may miss out on some of these benefits of pooling resources. “It's at least unfortunate, and not very sporting, as the British would say," Schaffner said.

At the same time, there could be advantages to Pfizer's going solo. “One of the greatest risks to this process is the perception of political influence, and in that regard, having parallel efforts, especially efforts seen as independent of one another and/or independent of perceived sources of political influence, is a good thing," said Mani Foroohar, an analyst at the investment bank SVB Leerink.

Pfizer declined to comment on its decision not to join the government's shared DSMB and trial network.

Whether it's Pfizer or one of the companies participating in Operation Warp Speed, the final say on whether a vaccine is ready for public use belongs to the FDA.

The FDA has promised to present the data to an advisory committee of external experts in a public meeting. A preliminary meeting will be held on Oct. 22 to discuss, generally, the standards the FDA will seek to see before authorizing any vaccine. The agency has also committed to holding advisory committee meetings to review data from individual vaccine candidates.

Between the independent trial safety monitoring boards and the public advisory committee meetings, “any kind of hanky-panky there that people are worried about is going to (go through) multiple checkpoints," Fauci said in an interview with Dr. Howard Bachner on the JAMA Network podcast on Sept. 25. “The big elephant in the room is, is somebody going to try to make a political end run to interfere with the process? … If you look at the standard process of how these things work, I think you can feel comfortable that it is really unlikely that that is going to happen."

Filed under:

How the world’s greatest health organization was brought to its knees by a virus and a president

by James Bandler, Patricia Callahan, Sebastian Rotella and Kirsten Berg

ProPublica is a Pulitzer Prize-winning investigative newsroom. Sign up for The Big Story newsletter to receive stories like this one in your inbox.

At 7:47 a.m. on the Sunday of Memorial Day weekend, Dr. Jay Butler pounded out a grim email to colleagues at the Centers for Disease Control and Prevention in Atlanta.

Butler, then the head of the agency's coronavirus response, and his team had been trying to craft guidance to help Americans return safely to worship amid worries that two of its greatest comforts — the chanting of prayers and singing of hymns — could launch a deadly virus into the air with each breath.

The week before, the CDC had published its investigation of an outbreak at an Arkansas church that had resulted in four deaths. The agency's scientific journal recently had detailed a superspreader event in which 52 of the 61 singers at a 2½-hour choir practice developed COVID-19. Two died.

Butler, an infectious disease specialist with more than three decades of experience, seemed the ideal person to lead the effort. Trained as one of the CDC's elite disease detectives, he'd helped the FBI investigate the anthrax attacks, and he'd led the distribution of vaccines during the H1N1 flu pandemic when demand far outstripped supply.

But days earlier, Butler and his team had suddenly found themselves on President Donald Trump's front burner when the president began publicly agitating for churches to reopen. That Thursday, Trump had announced that the CDC would release safety guidelines for them “very soon." He accused Democratic governors of disrespecting churches, and deemed houses of worship “essential services."

Butler's team rushed to finalize the guidance for churches, synagogues and mosques that Trump's aides had shelved in April after battling the CDC over the language. In reviewing a raft of last-minute edits from the White House, Butler's team rejected those that conflicted with CDC research, including a worrisome suggestion to delete a line that urged congregations to “consider suspending or at least decreasing" the use of choirs.

On Friday, Trump's aides called the CDC repeatedly about the guidance, according to emails. “Why is it not up?" they demanded until it was posted on the CDC website that afternoon.

The next day, a furious call came from the office of the vice president: The White House suggestions were not optional. The CDC's failure to use them was insubordinate, according to emails at the time.

Fifteen minutes later, one of Butler's deputies had the agency's text replaced with the White House version, the emails show. The danger of singing wasn't mentioned.

Early that Sunday morning, as Americans across the country prepared excitedly to return to houses of worship, Butler, a churchgoer himself, poured his anguish and anger into an email to a few colleagues.

“I am very troubled on this Sunday morning that there will be people who will get sick and perhaps die because of what we were forced to do," he wrote.

When the next history of the CDC is written, 2020 will emerge as perhaps the darkest chapter in its 74 years, rivaled only by its involvement in the infamous Tuskegee experiment, in which federal doctors withheld medicine from poor Black men with syphilis, then tracked their descent into blindness, insanity and death.

With more than 216,000 people dead this year, most Americans know the low points of the current chapter already. A vaunted agency that was once the global gold standard of public health has, with breathtaking speed, become a target of anger, scorn and even pity.

How could an agency that eradicated smallpox globally and wiped out polio in the United States have fallen so far?

ProPublica obtained hundreds of emails and other internal government documents and interviewed more than 30 CDC employees, contractors and Trump administration officials who witnessed or were involved in key moments of the crisis. Although news organizations around the world have chronicled the CDC's stumbles in real time, ProPublica's reporting affords the most comprehensive inside look at the escalating tensions, paranoia and pained discussions that unfolded behind the walls of CDC's Atlanta headquarters. And it sheds new light on the botched COVID-19 tests, the unprecedented political interference in public health policy, and the capitulations of some of the world's top public health leaders.

Senior CDC staff describe waging battles that are as much about protecting science from the White House as protecting the public from COVID-19. It is a war that they have, more often than not, lost.

Employees spoke openly about their “hill to die on" — the political interference that would prompt them to leave. Yet again and again, they surrendered and did as they were told. It wasn't just worries over paying mortgages or forfeiting the prestige of the job. Many feared that if they left and spoke out, the White House would stop consulting the CDC at all, and would push through even more dangerous policies.

To some veteran scientists, this acquiescence was the real sign that the CDC had lost its way. One scientist swore repeatedly in an interview and said, “The cowardice and the caving are disgusting to me."

Collectively, the interviews and documents show an insular, rigorous agency colliding head-on with an administration desperate to preserve the impression that it had the pandemic under control.

Some of the key wounds were self-inflicted. Records obtained by ProPublica detail for the first time the cataclysmic chain of mistakes and disputes inside the CDC labs making the first U.S. test for COVID-19. A respected lab scientist made a fateful decision to use a process that risked contamination, saw signs of trouble, but sent the tests to public health labs anyway. Many of those tests didn't work, and the scramble to fix them had serious consequences.

Even when the CDC was not to blame, the Trump administration exploited events to take control of the agency's messaging. As a historically lethal pandemic raged, the White House turned the CDC into a political bludgeon to advance Trump's agenda, alternately blocking the agency's leaders from using their quarantine powers or forcing them to assert those powers over the objections of CDC scientists.

Once seen as an apolitical bulwark, the CDC endured meddling on multiple fronts by officials with little or no public health experience, from Trump's daughter Ivanka to Stephen Miller, the architect of the president's immigration crackdown. A shifting and mysterious cast of political aides and private contractors — what one scientist described as young protégés of Trump's son-in-law, Jared Kushner, “wearing blue suits with red ties and beards" — crowded into important meetings about key policy decisions.

Agency insiders lost faith that CDC director Dr. Robert Redfield, a Trump appointee who'd been at the agency only two years, would, or could, hold the line on science. One division leader refused to sign what he viewed as an ill-conceived and xenophobic Trump administration order. Redfield ultimately signed it himself.

Veteran CDC specialists with global reputations were marginalized, silenced or reassigned — often for simply doing what had always been their job. Some of the agency's most revered scientists vanished from public view after speaking candidly about the virus.

The Trump administration is “appropriating a public enterprise and making it into an agent of propaganda for a political regime," one CDC scientist said in an interview as events unfolded. “It's mind-boggling in the totality of ambition to so deeply undermine what's so vitally important to the public."

The CDC repeatedly declined to make Butler, Redfield or any other employees mentioned in this story available for questions, and a CDC spokesperson declined to comment on behalf of the agency. The White House did not respond to an email seeking comment.

A spokesperson for the Department of Health and Human Services, which oversees the CDC, rejected accusations of political interference.

“Under President Trump, HHS has always provided public health information based on sound science," the HHS spokesperson said. “Throughout the COVID-19 response, science and data have driven the decisions at HHS."

People interviewed for this story asked to remain anonymous because they feared retaliation against themselves or their agency.

In interviews and internal correspondence, CDC employees recounted the stunning fall of the agency many of them had spent their careers building. Some had served on the front lines of the CDC's most storied battles and had an earned confidence that they could swoop in and save the world from the latest plague, whether it was E. coli on a fast-food burger or Ebola in a distant land. Theirs was the model other nations copied. Their leaders were the public faces Americans turned to for the unvarnished truth. They'd served happily under Democrats and Republicans.

Now, 10 months into the crisis, many fear the CDC has lost the most important currency of public health: trust, the confidence in experts that persuades people to wear masks for the public good, to refrain from close-packed gatherings, to take a vaccine.

Dr. Martin Cetron, the agency's veteran director of global migration and quarantine, coined a phrase years ago for what can happen when people lose confidence in the government and denial and falsehoods spread faster than disease. He called it the “bankruptcy of trust." He'd seen it during the Ebola outbreak in Liberia in 2014, when soldiers cordoned off the frightened and angry residents of the West Point neighborhood in Monrovia, the capital. Control of a pandemic depended not just on technical expertise, he told colleagues then, but on faith in public institutions.

Today, some CDC veterans worry that it could take a generation or longer to regain that trust.

“Most of us who saw this could be retired or dead by the time that's fully fixed," one CDC official said.

Dr. Anne Schuchat, the CDC's top career scientist, was one of the first to notice a brief report about four cases of “unexplained pneumonia" in Wuhan, China, in an emerging diseases bulletin. It followed a warning about a “red blotch disease" in the grape industry.

As a disease detective in 2003, Schuchat had been dispatched to China to investigate the outbreak of SARS, a respiratory disease that killed about 800 people and shut down parts of Asia. Her role in that outbreak and in later epidemics inspired the virus hunter played by Kate Winslet in the movie “Contagion." Unflappable and regarded as brilliant, Schuchat eases the tension at meetings by singing ditties about the latest outbreak set to Broadway tunes. Nobody wants to disappoint her.

At 8:25 a.m. on Dec. 31, Schuchat emailed Butler and other colleagues asking if “any of your folks know more about the 'unknown pneumonia'" in Wuhan.

Emails and calls bounced among the agency's leaders, a handful of veterans with more than a century of experience among them. Dr. Dan Jernigan, the flu chief, and his boss, Dr. Nancy Messonnier, met at headquarters to plan. Within hours, they learned there were 27 cases — seven of them severe — with fever, difficulty breathing and a buildup of abnormal substances in the lungs. All the cases were believed to be connected to an outdoor seafood market. “Raises concern about SARS," Messonnier wrote in an email.

The news reached Cetron in New Hampshire. While celebrating the holidays at a beer-and-tacos pub across the river in Vermont, he told family and friends about a new virus in China that he worried could affect the whole world. “We should be bracing ourselves," he said.

If the outbreak had been a movie, this would have been the scene where the heroine mobilizes an all-star squad of specialists to save the planet. Schuchat's team is seen as among the top infectious disease experts in the world. All of them had started out in the CDC's Epidemic Intelligence Service, an elite corps of globetrotting disease fighters. They were a brain trust forged by decades of defending the country from outbreaks.

But in the 11 years since the H1N1 flu pandemic, the terrain had shifted. Politics and budget cuts had weakened the agency at home and abroad. Meanwhile, the regime in Beijing had grown increasingly aggressive and authoritarian. The Trump administration's trade war had worsened tensions. And after a series of tough-minded leaders who were adept at protecting the agency and its mission, Trump's first choice as director quit after Politico reported that she had purchased tobacco stocks while leading the CDC, which fights lung diseases.

Trump appointed Redfield in 2018. He was an HIV researcher who had treated AIDS patients since the earliest days of the disease. He'd wanted the CDC job for decades, and had been passed over for it twice. During his first all-hands meeting at the Atlanta campus, he'd choked up describing the honor of leading the agency.

In the fierce chaos of Trump's Washington, the CDC needed a streetfighter. Instead, it got “the nicest grandfather you can imagine," a senior health official said. A former colleague described how Redfield, a devout Catholic, prayed with the ailing Elijah Cummings, a Democratic congressman from Baltimore, during a visit to the Capitol.

Redfield took over an agency that, despite its $8.3 billion budget, was feeling the chronic funding woes of the American public health system, which has been quietly gutted since the Great Recession. As the coronavirus began its march through the United States, years of federal and state cuts had left about 26,000 fewer employees at state, county and municipal health agencies since 2009, according to the nonpartisan Trust for America's Health.

With a mission of protecting America from diseases, the CDC was stretched thin. Over the decades, its portfolio had expanded to include almost every malady, chronic or acute.

The CDC's global presence was suffering too. An infusion of hundreds of millions of dollars at the time of the Ebola epidemic in 2014 allowed the agency to increase its presence to as many as 65 countries, but a large chunk of those funds ran out in 2019. As funding expanded and contracted in recent years, the CDC had to cut over 300 posts overseas, including both Americans and foreigners. By the time Schuchat noticed the blurb about an outbreak in Wuhan, her agency no longer had an office inside the Chinese Center for Disease Control and Prevention, its counterpart in Beijing. While the U.S. agency once had more than a dozen Americans in China, by January only three remained.

On Jan. 3, Redfield phoned his agency's closest ally in Beijing, George Gao, the director of China's CDC, a microbiologist trained at Oxford and Harvard. Gao said his agency had sent a field investigation team to Wuhan. But during conversations in the next few days, many of Redfield's questions about the mystery disease went unanswered. Gao, who was usually open and talkative, sounded guarded, according to several officials familiar with the conversations.

Nevertheless, Redfield assured federal health and national security officials that information was flowing from China thanks to his rapport with Gao, knowledgeable people said.

On Jan. 6, Redfield sent Gao a carefully worded letter offering the help of CDC experts. Expecting the Chinese to accept “very soon," CDC leaders began preparing a team to go to China, emails show.

To Redfield's chagrin, however, the conversations with Gao came to a sudden halt. Ominous news accumulated: the first recorded death, Jan. 9, the first case outside China, Jan. 13. In the secure, high-tech room where the CDC brain trust met, the mood turned dark as the scientists began to fear they were confronting a pandemic.

“We were slowly convincing folks: It doesn't matter if you believe it or not, but this is the circumstantial evidence," a senior lab official said. “And you have to prepare."

Amid the scramble to find out what was happening in China, CDC officials began telling the public not to panic. But they conveyed the serious nature of the threat.

On Jan. 17, for example, Messonnier said that the CDC was “especially concerned about a novel coronavirus" because related viruses — SARS and Middle East Respiratory Syndrome — were “difficult outbreaks with many people getting ill and deaths."

It appeared that the illness had been spreading since at least early December, but data on cases provided by Chinese authorities was woefully incomplete, listing only the dates patients were hospitalized, not what symptoms they had or for how long, the senior lab official said.

“We knew they were good enough epidemiologists to get that data," the official said. “Why aren't they announcing the results?"

The lab official tried to contact a chief virologist at the China CDC who was usually helpful, but got no response. Neither did colleagues who reached out to Chinese scientists with whom they had collaborated for years. The Americans concluded that the regime in Beijing was telling them to keep quiet.

Gao had also run up against a cover-up by authorities in Wuhan, health and national security officials said. Gao's field investigators were “told there was no evidence of human-to-human transmission," said Dr. Ray Yip, a former country director for the CDC in China. “They didn't show them all the cases. They had a couple of cases of hospital workers infected by then, and that's obviously human-to-human, how else did they get it?"

During the SARS epidemic in 2003, Time magazine reported that Chinese authorities had hidden 31 infected health workers from the world by pulling them from their hospital, loading them into ambulances, and driving them around Beijing until a visiting delegation from the World Health Organization left the hospital.

In January of 2020, the bond between the U.S. and Chinese health agencies became a double-edged sword. Chinese leaders were wary about Gao's relationship with the Americans, who heard rumblings that he would be made the scapegoat for the outbreak. Meanwhile, Redfield's reputation suffered in Washington because he didn't deliver.

“The China CDC and the U.S. CDC were almost seen as one," a senior U.S. health official said. “Dr. Redfield contributed to this by talking about how much he talked to Dr. Gao, the information exchange they had going. There was a sentiment blaming Dr. Redfield for the inability to get more information."

In reality, the blame went beyond Redfield and his agency. China was a hard target. Even U.S. spy agencies struggled to gather intelligence on the evolution of the disease. Still, at the moment of truth, the CDC's decades of investment in building a network in China did not pay off. That failure created an early and significant schism between the agency and the Trump administration.

“What the fuck are we paying for people to be in China if they can't go where there's an outbreak when there's an outbreak," Joe Grogan, then the head of the White House's Domestic Policy Council, recalled saying repeatedly at the time.

Deputy National Security Advisor Matthew Pottinger was another influential critic of the CDC and one of the first senior White House officials to realize the magnitude of the coronavirus threat. Pottinger had served as a Marine intelligence officer and worked in China as a correspondent for The Wall Street Journal. His coverage of the SARS pandemic had helped shape his view of China as what he called “an expansionist totalitarian empire."

Pottinger clashed with CDC officials when he pushed to limit travel from China. Many of the agency's scientists held the traditional public health view that border closures interfere with the movement of medical personnel and goods. On Jan. 31, Trump issued an order restricting most foreigners from entering the United States if they had been in China within the 14 days before their arrival.

The CDC deployed personnel to airports to screen incoming passengers for symptoms, a measure that leaders now admit was futile, given the high number of asymptomatic cases. (Of the 754,124 travelers screened at U.S. airports by mid-September, only 24 cases of COVID were confirmed, according to CDC records.)

The CDC had gone from being the world's finest disease SWAT team to batting back claims from the administration that it was doing a lousy job.

Another blow came on Feb. 25, after an ill-fated press conference about the steps Americans might need to take to protect themselves. Leading that briefing was Messonnier, the no-nonsense director of the CDC's powerful immunization and respiratory diseases center, who'd come to prominence during the 2001 anthrax attacks.

Asked by the media team to add a personal touch, Messonnier said she'd told her children they needed to prepare for a significant disruption of their lives and had called their school to ask about plans for online learning. Afterward, she left to take her children to the dentist.

But her words had rocked Wall Street and the White House. Soon the staff in the Atlanta Emergency Operations Center saw a news alert with a photo of Messonnier pop up on their phones. A CDC veteran remembers thinking: “Oh, crap, the stock market dropped!"

The market's fall infuriated the president. Trump had privately confessed to author Bob Woodward that he was publicly downplaying the virus to prevent panic. The CDC would pay the price for undercutting that narrative.

The next day, Trump put Vice President Mike Pence in charge of his coronavirus task force and assumed the role of communicator-in-chief. The CDC, which had been the public face of the government during every health crisis in memory, soon became nearly invisible. After a few more briefings, a Pence aide told the agency's media staff that this was the president's stage, not theirs.

Even when Redfield was allowed to speak publicly, his sleepy eyes and soft, droning tone anesthetized listeners. The agency had been effectively muzzled.

“When it mattered the most, they shut us up," a senior CDC official said. “The threat is clear. If we want to ever be able to talk tomorrow or next week or next month — or whatever is being dangled in front of us, you stay inside the lines."

A friend of one CDC scientist ribbed him: “We keep waiting for the CDC to show up on a milk carton as a missing child."

In the months that followed, CDC scientists watching the president's news conferences on a wall of screens in the agency's Emergency Operations Center were dumbfounded as Trump countermanded science in a flurry of inaccuracies and dangerous advice, saying the virus would soon go away, theorizing about injecting disinfectant as a treatment, and dismissing recommendations about wearing a mask.

As the agency stumbled in China and at home, a group of lab scientists was assigned a high-stakes mission: developing a test for the coronavirus.

Inside a small lab on the CDC's Atlanta campus, microbiologist Stephen Lindstrom was put in charge. A Saskatchewan native who speaks at a breakneck clip, Lindstrom had studied in Tokyo and defended his Ph.D. dissertation in Japanese. During the H1N1 flu pandemic, his team had invented a test, jumped through regulatory hurdles and shipped it around the world in just two weeks' time.

“Frankly, he kind of lives for the pressure," said one of his colleagues.

But this time around, just about everything that could go wrong did. Calculated decisions went sideways, and Lindstrom couldn't find a quick way to right them. Mystifying contamination appeared at every turn, relegating tests to the trash heap. Precious weeks were lost.

The CDC declined to make Lindstrom available for questions. But lab records obtained by ProPublica and interviews reveal for the first time the mounting pressure and the cascading troubles inside the lab.

As soon as Lindstrom's team received the genetic sequence from scientists in China in January, they got to work. By the time German researchers on Jan. 13 announced the recipe for the test that would be adopted by the World Health Organization, Lindstrom's team was almost done building its own.

Lindstrom had turned to the lab's expert on coronaviruses to design the U.S. test. They chose one that looked for three targets on the same coronavirus gene. While the first and second targets were unique to the new virus spreading in China, the third would identify a broader family of coronaviruses, useful if the virus circulating in China mutated as it infected Americans.

Such a test works like this: Imagine three different pieces of velcro, each custom-made to stick to one of those three genetic targets. If any of them finds a perfect match in a patient's sample, the test will cause that snippet of genetic material to duplicate over and over until there's enough to light up a signal, alerting a technician that there is a positive test result.

To make sure the tests work properly, microbiologists prefer to validate a test using actual virus samples taken from people. Lindstrom didn't have that, but he could use lab-made pieces of the virus to do the same thing. He also needed to make the velcro-like testing ingredients that find matches in patient samples.

Making both the testing ingredients and the snippets of the virus in the same location, though, goes against best practices. Even in world-class labs, manufacturing pieces of a virus can leave microscopic traces in the environment and on equipment for months. Those can later contaminate tests so that even water would give a positive result. That kind of false positive renders the tests useless.

Lindstrom's lab didn't have the equipment or expertise needed to make the raw materials for the test. But an underground corridor led to another CDC lab — the “core facility" — in a gleaming glass tower. Lindstrom had used it many times to quickly make testing materials. The facility could make what Lindstrom needed, but it was risky.

Hiring a private company to take on one of those tasks would add at least 10 days to production times, an eternity during an outbreak. So Lindstrom hedged his bets. He placed an order with a contractor for the genetic pieces he needed, but also asked the core facility to make those snippets along with the velcro-like ingredients.

“It's a pretty dangerous procedure to make that in the same facility" due to contamination, said one CDC scientist. “Trying to fast-track it this way was risky."

Years ago, low-level contamination ruined some CDC tests for Middle East Respiratory Syndrome, even though the core facility made the viral pieces on a different floor from the velcro-like ingredients, according to a person familiar with the matter.

Initially, it looked as if Lindstrom had made a good call. The core facility cranked out the parts needed for the tests and they passed quality checks, suggesting that making all of them in house wasn't a problem. On Jan. 20, his lab was able to identify the first positive U.S. case. Still, Lindstrom showed a rare flash of anxiety, telling colleagues: “This is going to either make me or break me."

Soon specimens were pouring in. At that point, Lindstrom's lab was the only one in the country able to test samples to confirm whether patients had COVID-19. At the same time, his team was racing to get authorization from the Food and Drug Administration for test kits that could be distributed to state and local public health labs. Exhausted CDC scientists arrived at 7 a.m. and left after 11 p.m.

With that authorization in the works, Lindstrom asked the core facility to begin mass-producing the ingredients that stick to the three genetic targets in a human sample. Then Lindstrom made a second risky decision. He had his team produce the stand-in for the virus that labs would use to check that a positive sample would trigger a positive result, lab records show.

The ingredients made by Lindstrom's lab and the core facility passed the quality checks, records show, so Lindstrom sent them to another CDC lab to process and put in vials for the test kits.

The first sign of trouble appeared on Feb. 3. Lindstrom's team performed quality checks on two lots of tests. In one lot, the third target was showing up as present when testers were using only water — a false positive result. The other lot was fine, records show. Though the flawed lot was set aside, this was a red flag. Contamination can be difficult to eliminate once it occurs, and the batch that failed had gone through the same lab spaces as the one that passed. Nevertheless, Lindstrom released the good lot of tests to be sent to public health labs.

While those tests were in transit, his team performed one last round of quality checks. This time, one of the test kits that they believed was fine also came back with a false positive, records show. Confoundingly, the next day that same kit performed as it should when Lindstrom's lab checked it, according to a lab record.

Complaints poured in as soon as the tests arrived at the public health labs. Before screening any samples from patients, scientists checked to ensure the tests worked, using water for a negative and the stand-in for the virus for a positive. They found the same problem with the third target: It registered as positive when just testing water.

“There is likely a widespread issue that will need to be addressed immediately," a California public health official said in an email to the CDC on Feb. 8.

“Aw Shit!" Lindstrom muttered to his staff. His team rechecked bulk testing ingredients from that lot, and found no issues. Then they pulled a portion from the freezer that hadn't been opened since they received it from the core facility. A few false positives turned up, records show. So Lindstrom's lab ordered from the core facility a replacement for the ingredient that is supposed to stick to the third target. But he also had contractors make some too.

At first, it looked like the problem could be solved quickly. The core facility delivered test ingredients that passed quality checks on Feb. 11. But subsequent checks — after they had been put in vials again — showed problems, records show.

Lindstrom told colleagues he was convinced there was contamination, but some CDC leaders insisted that the problem was actually a faulty design akin to a software bug — that Lindstrom had chosen genetic sequences that could cause a glitch and show a false positive, according to emails and interviews. While they debated, public health labs with the faulty kits couldn't process samples, and the FDA still hadn't authorized any tests made by commercial labs. Instead of a network of labs around the country testing sick people, Lindstrom's team remained one of the few that could do it, using kits they'd made before the problem arose.

The air was filled with tension. At one point, a manager on the CDC coronavirus response team banged on the door to Lindstrom's lab and demanded test results from his staff rather than waiting for them to be entered in the agency's database, according to a scientist who was present. During a meeting, Lindstrom yelled at his colleagues for going around him and browbeating his people, according to an official who was present.

When it seemed things couldn't get any worse, they did. Public health labs began reporting on Feb. 12 that they also were having problems with the part of the test that was supposed to stick to the first target. Subsequent checks by Lindstrom's lab found the same problem, records show. Lindstrom now had an issue with the ingredients that were supposed to match two of the three targets. And it wasn't clear whether there was contamination in his lab, the core facility or the separate facility that put the material into vials. Two weeks after the first complaint, the CDC still didn't have a solution.

The FDA's head of lab diagnostics showed up to troubleshoot and found Lindstrom's lab in disarray. The Wall Street Journal later reported that the FDA official's boss told CDC leaders that if it had been any other lab, they would have shut it down.

Public health labs were clamoring for tests, and Lindstrom was running out of options. The replacement material that was supposed to stick to the third target was made incorrectly and had to be scrapped, records show. The test kits he had ordered from contractors hadn't arrived yet.

It seemed like the virus' fingerprints were everywhere. So when the core facility sent some test ingredients that passed quality checks, Lindstrom hired a contractor to put them in vials. Even those tests came back with problems, a lab record shows.

With the FDA's blessing, Lindstrom cobbled together test ingredients from different batches that had all passed quality checks, and they dropped the troublesome third target.

By the end of February, three weeks after public health labs first reported problems, the CDC started to send new test kits.

In the aftermath, an investigation by HHS lawyers pointed to Lindstrom's lab as a likely source of contamination and praised the core facility for following “extreme precautionary measures" that minimized risk. Lindstrom fumed to colleagues that the HHS report was inaccurate. He was adamant that evidence showed the contamination originated in the core facility, not his own lab, records show.

The CDC did its own review but never released it. Separately, the HHS inspector general has been investigating. And some CDC scientists remain convinced that the problem wasn't contamination but faulty design.

Anger and mistrust caused by the shortage of tests fell on the CDC — even if the FDA shared the blame for sticking to a cumbersome regulatory process that delayed the rollout of more tests. The combination of delays and missteps by the nation's two top health agencies put the United States dangerously behind in assessing the spread of the virus. In contrast, South Korean officials gave near instantaneous approval to commercial labs, and they quickly began testing 10,000 people a day.

In a written statement, FDA spokeswoman Lauren-Jei McCarthy said her agency “has demonstrated unprecedented regulatory flexibility in order to speed development and quickly authorize tests." The FDA, she said, streamlined its process to allow “diagnostic tests to be developed, validated, and deployed within weeks rather than several months to over a year, as traditionally required."

In July, the acting director of Lindstrom's division summoned him. He was reassigned to a new job with no official title and few responsibilities.

The following month, a CDC journal published a study that showed that Lindstrom had not been the only one struggling with faulty tests. Commercial labs in Europe had similar problems that delayed testing in at least nine countries.

By then, though, the damage had been done. To the public and within the federal government, the CDC had failed catastrophically at a critical juncture.

As the virus hopscotched across the globe, cruise ships became early symbols of the pandemic. Overnight, they morphed from bastions of leisure into pariahs of the sea, floating hotspots crammed with tourists, sick and well.

The Diamond Princess quickly became the most infamous. During excruciating weeks in February, the disease ripped through the massive ship, infecting hundreds of passengers off the port of Yokohama, Japan. Relatives of those stranded on board pleaded with the U.S. government to evacuate them, likening the recirculated air to a gas chamber.

At the CDC, the dilemma of what to do with the ships and their passengers, many of them Americans, fell to Cetron, who had led the agency's quarantine division for more than two decades.

Cetron, 61, bore his responsibilities with a grim knowledge of the past. The CDC doesn't have much statutory authority. Its influence lies in the ability to coax the public into acting in the nation's collective interest. But the agency has one formidable power: the ability to control border movement during an outbreak and deprive people of their freedom to protect the public's health.

Cetron had talked openly about how that power had been used in the past as a weapon to stigmatize. His academic research partner, the medical historian Howard Markel, had written a book about the mistreatment of Jewish immigrants in New York during cholera and typhoid outbreaks in 1892. Even a group sent to help called them “human maggots." Authorities shunted them off to a quarantine island where they endured squalor and isolation. Some died.

But with the coronavirus, the agency's singular authority would be undercut, abused and politicized — and Cetron would be unable to stop it.

As the Diamond Princess languished, U.S. diplomats assured passengers that nobody with the virus would board the evacuation flights. However, after packing the American passengers on buses headed for chartered planes, officials learned that 14 had tested positive. The State Department pushed for all of the passengers — uninfected and infected — to fly out together, according to CDC officials who were involved in the discussions.

Schuchat and Butler objected. Dr. Robert Kadlec, the HHS official in charge and a former Air Force colonel, sided with the State Department. Kadlec told colleagues the priority was bringing Americans home. On one of the planes, the only thing separating the infected from the non-infected was a flimsy plastic sheet.

The Washington Post reported that Schuchat demanded the removal of all references to the CDC from the State Department press release about the repatriation.

CDC officials involved told ProPublica that they were appalled by both the decision and its sloppy execution. “There's a four-foot gap at the top of the shower curtain that you bought from Home Depot — and you're calling this a quarantine area?" one said. “If I were to write a book, it would be called Operation Clusterfuck, and it would start with this chapter."

Spokespeople for the State Department and HHS said diplomats and federal health experts took stringent precautions on the evacuation flights.

“Individuals who tested positive were moved in the most expeditious and safe manner to a specialized containment area on the evacuation aircraft," a State Department spokesperson said in a written response. He added, “All passengers were closely monitored by medical professionals throughout the flight and were provided masks for additional protection."

Despite that very public ordeal, cruise lines kept packing more passengers on board and heading out to sea. Days after the Diamond Princess evacuation, a ship from the same company, the Grand Princess, set sail from San Francisco on another ill-fated voyage. On March 5, a military helicopter had to fly to the ship to deliver tests after passengers got sick.

The next day, with the Grand Princess floating off the coast of San Francisco, Trump flew to Atlanta for an impromptu tour of the CDC laboratories. Wearing a red “KEEP AMERICA GREAT" cap, Trump briefly praised the CDC's tests as “perfect" and talked about the record high ratings for his recent appearance on Fox News. Asked by a reporter about cruise ships, the president said he preferred that the Grand Princess passengers remain on board because their arrival — even at a federal quarantine site — would cause a spike in U.S. case numbers.

“I don't need to have the numbers double because of one ship," Trump told reporters.

Cetron and his team mapped every cruise ship at sea with COVID patients, working feverishly to build support in the government for a no-sail order that could prevent more outbreaks. “These cruise ships are the equivalent of mass gatherings of hundreds if not thousands of the most vulnerable populations" at risk for severe illness or death from COVID, and any of these passengers could seed the virus in their communities when they returned home, he said in an email to Redfield.

The cruise industry resisted and put forth a plan that would allow companies to keep sailing with extra safety precautions. The day after Trump's appearance in Atlanta, Pence and Redfield met in Florida with cruise executives. After Pence praised the industry's “spirit of collaboration," the chairman of the industry's largest trade group said, “Given the significance of travel and tourism, it is critical that Americans keep traveling."

Employees watching in the CDC's command center in Atlanta let out an audible groan.

Cetron told colleagues in an email that the industry's plan was inadequate, given the “sardine can density" of these ships, records show. Every day the federal government delayed shutting down this industry meant more illness and death. At a meeting in March, Cetron railed against the industry's recalcitrance and his own government's unwillingness to act, according to people who attended.

“This is unconscionable," he told Schuchat and more than a dozen others around the conference table, his voice so anguished it alarmed some who were there.

Colleagues could see the toll the battle was taking on him. Raccoon-like rings deepened around his eyes. He looked like an unmade bed, often wearing the same shirt, pants and rumpled tweed jacket with elbow pads as the day before. At one point, the CDC's chief of staff became so worried about Cetron's health that he ordered him to surrender his phone to Butler, who answered the late-night calls. “Go home and get some sleep," the chief of staff commanded, according to people who overheard the conversation.

When the CDC finally issued a 30-day no-sail order on March 14, it excluded the majority of cruise operators since their trade group, Cruise Lines International Association, voluntarily agreed the previous day to stop launching any new ships from U.S. ports during that time. The order praised the trade group's actions, “and the commitment it demonstrates to protecting the health of both cruise ship passengers and the public at large."

Outbreaks continued on ships that were already at sea. The trade group had drafted a plan to hire a global rescue team staffed by special-operations veterans who would extract infected passengers and take them to medical facilities contracted to care for them “without burden on the U.S. government," records show. Yet by April 6, the group still hadn't hired the rescue company, and public health authorities had to scramble to help evacuate critically ill people from ships, records show.

Cetron worked on a new no-sail order that exposed the industry's failures and required cruise operators to care for the 79,800 crew members on ships in or near U.S. ports without further strain on public health workers, records show.

“Poor planning by the industry, failure to adhere to recommendations and unsafe transport operations used by ships to get passengers and crew home has posed significant risks to local, state, national and international spread of the virus," Cetron told Redfield in an email. “Dozens of vessels are still at sea with active COVID infections on board," he added, “heading toward US waters requesting arrival in our ports."

Cetron told Redfield this tougher order was “urgently needed." Yet, the Department of Homeland Security refused to sign off. Officials wrote that they disagreed with CDC's “narrative describing the actions of the cruise line industry."

After four days of wrangling, DHS agreed to keep the force of the order, but Cetron's criticisms of the cruise industry were censored or softened. A section titled “Failure of Cruise Ship Industry to Develop and Implement a Response Plan" became “Critical Need for Further Cooperation and Response Planning."

Representatives from Cruise Lines International Association did not return emails or a phone call.

In September, the CDC proposed extending the no-sail order into February 2021, but the White House Coronavirus Task Force instead sided with the cruise industry and picked an end date of Oct. 31.

At the same time as they were watering down Cetron's criticism of the cruise industry, the White House and DHS were pushing him to invoke quarantine powers to stop a problem that barely existed: the spread of coronavirus by migrants trying to cross the U.S.-Mexico border.

Two days after the no-sail order in March, Trump's senior adviser Stephen Miller scheduled a meeting to discuss “Emergency Border Planning." Like Cetron's ancestors, Miller's great-great-grandfather escaped anti-Semitism in Eastern Europe and found refuge in the United States. But Miller was a driving force behind Trump's so-called Muslim ban, as well as the family-separation policy and efforts to build a wall spanning the 1,954-mile U.S.-Mexico border.

In a call on March 17, Miller urged the administration to use the CDC's powers to close the border immediately because “the Southern Border is in crisis and will get worse as COVID-19 spreads in Mexico," according to an email from a deputy general counsel at HHS.

Shortly after 7 a.m. the next day, an HHS lawyer sent Cetron's team a proposed CDC order that largely closed the borders with Mexico and Canada. A deputy of Cetron's lamented to the agency's chief of staff that the order cited a “misrepresented and incomplete piece of data" to overstate the threat.

“I'm also not a fan of trying to make the case that Canada and Mexico represent a big risk on the land border based on what we 'believe' is occurring vs. what we know about the # of cases (which are far fewer than the # of cases in the US now due to community spread)," she wrote.

Cetron refused to sign off on the order, according to people who worked with him. “I will not be a part of this," a furious Cetron told a colleague. “It's just morally wrong to use a public authority that has never, ever, ever been used this way. It's to keep Hispanics out of the country. And it's wrong."

With Cetron engaged in a personal act of civil disobedience, Redfield signed the order.

For the first time since the enactment of the Refugee Act of 1980, people who came to the border saying they feared persecution or torture in their home countries were turned away with no chance to plead their case for asylum.

Ken Cuccinelli, a senior Homeland Security official, later boasted to a congressional committee that border agents had expelled “90 percent of aliens crossing the Southern Border within two hours of encountering them — an incredible feat and of critical importance to the public health and the protection of our workforce in response to COVID."

The order signed by Redfield said the CDC had invoked its powers “to protect the public health from an increase in the serious danger of the introduction of Coronavirus Disease 2019." Nevertheless, border officials tested unaccompanied children seeking asylum — and expelled them even if their results were negative.

An HHS spokesperson said the department does not discuss internal deliberations. A CDC spokesman declined to make Cetron available for interviews.

During an online talk in August hosted by Dartmouth College, he said that one of the lessons of this pandemic was the importance of “a full bank account of trust" in institutions.

“And if there's a bankruptcy of trust," he said, “it can be really tough."

By April, the numbers were brutal. There were 608,000 cases of COVID nationwide. More than 26,000 people had died, about 10,000 of them in New York City, where the per capita death rate had surpassed Italy's. Morgue trucks appeared outside hospitals.

Inside the CDC, scientists scrambled to gather and analyze data that could alert them to emerging hotspots. The data was their fuel, driving almost every decision they made. Early in the outbreak, the lack of widespread testing had caused a shortage of data, obscuring the agency's vision as the virus spread in Washington state, New York and New Jersey. The CDC updated its well-regarded hospital tracking system to collect information about COVID.

But in a startling power play this spring, the Trump administration stripped the CDC of its lead role in handling this vital hospital data, bringing in a private contractor that would struggle to gather reliable information. The unprecedented move, CDC scientists and public health specialists said, struck at the heart of the agency's mission.

Now, with fall pushing people indoors and threatening a new wave of infections, CDC scientists worry they will again have trouble tracking outbreaks and directing doctors, nurses, medicine and equipment to hotspots.

“When you don't have quality data that is accurate and reliable, you miss out on signals,'' a CDC data scientist said. “It can have a devastating impact."

Like many of the agency's travails, politics played a role in the battle over data. Powerful critics worked backstage to sideline an agency that they saw as unresponsive and ineffective.

In February, Pottinger, the deputy national security advisor, had lobbied hard for Dr. Deborah Birx, his wife's friend and former boss, to be named the White House coordinator of the federal response. Pottinger was exasperated by the CDC's testing debacle and its failures in China. But it was also personal. As a former CDC scientist, Pottinger's wife had helped invent an HIV test, which was adopted overseas, but not in the United States due to what Pottinger believed was bureaucratic dispute within the CDC. Pottinger told White House colleagues that the agency had a “culture where petty rivalries between egos tend to subordinate the public good."

Birx, too, was no fan of the agency, even though she'd once run its global AIDS program, according to officials who know her. Since 2014, she'd overseen the State Department's international AIDS-fighting initiative, which is seen as one of the most effective federal health programs in U.S. history. Birx was a leader who sent emails at 3:45 a.m. A former CDC colleague praised her as brilliant and “data-driven."

Others were less impressed. Senior officials claimed she amassed power by undermining colleagues, stoking upheaval and presenting herself as the lone savior in a crisis. In February, an audit of her AIDS program by the State Department's inspector general found that 49 of 68 respondents were critical of the leadership, with some describing it as “dictatorial" or “autocratic." Several employees complained about intense pressure to meet performance targets, with one saying, “You're incentivizing data cooking."

With the CDC now under her ambit, Birx made similar demands. During contentious meetings, she clashed with Schuchat and others over the coronavirus data the CDC collected from hospitals, according to people who were present. She wanted many more details, and she wanted them faster.

Birx expected “every hospital to report every piece of data every day, which is in complete defiance of statistics," a CDC data scientist said. “We have 60% [of hospitals] reporting, which was certainly good enough for us to have reliable estimates. If we got to 80%, even better. A hundred percent is unnecessary, unrealistic, but that's part of Birx's dogma."

In April, HHS hired TeleTracking Technologies Inc. to collect COVID data along with the CDC. But the Pittsburgh company had trouble getting accurate information, records and interviews show. A CDC analysis in May discovered that data about ventilator use was missing from 57% of hospitals that reported to TeleTracking, compared with 6% of hospitals reporting to the CDC system during the same week. Rather than acknowledge that data was missing, the company reported zeroes instead, according to the CDC analysis.

“It would be like reporting on race and assuming that everybody for whom that variable is missing is white," a senior CDC official said.

Still, TeleTracking agreed to add many data fields to the forms that hospitals had to fill out every day. CDC data experts refused to do that, warning that hospitals confronted with a form with 91 categories would leave them blank or provide unreliable numbers.

At an impasse, the government in July told hospitals to stop reporting coronavirus data to the CDC.

“That's really almost like the final blow to show CDC you are out of the game," said Yip, the agency's former country director in China. “We don't even trust you to handle the basic data."

A TeleTracking spokesperson defended the company's performance.

“TeleTracking, under HHS's direction, has developed a data collection system that has enabled more hospitals to report their data more quickly and reliably than ever before," the spokesperson said. “Since the switchover in July, compliance has improved more than 25%."

Spokespeople for TeleTracking and HHS also pointed out that Redfield has publicly praised the new system and said his agency's experts still have access to the data.

The pandemic has required a different and more flexible approach, an HHS spokesperson said. “Rather than reject incorrect data outright, HHS allows it to flow into our system," the spokesperson said. “The error is flagged and then resolved directly with the hospital."

Birx did not respond to requests for comment. During a press briefing on Oct. 6, she said she had worked with hospitals to pare back some daily requests to weekly. But at the same briefing, she and other health officials announced that hospitals now would have to provide information about flu patients as well as COVID. If they didn't, the officials said, they could lose their Medicare and Medicaid funding — a fatal blow for a hospital.

CDC experts fear hospitals may cut corners as they try to comply. A scientist predicted that the tough new policy would “convert a problem of incomplete data to a problem of invalid data."

By the summer, communities were wracked with anxiety about how to safely reopen schools that had been shuttered since the spring. They looked to the CDC for advice.

From past experience, the CDC's career scientists knew that schools were tricky political terrain. The last time a pandemic hit the U.S., in 2009, the CDC caused a political backlash when it suggested one- to two-week school closures. But the outcome of the inevitable tug of war between politics and science was much different.

Just months after President Barack Obama took office, a novel flu jumped from pigs to people, then spread across the nation. CDC scientists identified it as an H1N1 virus and initially feared it might be as deadly as the 1918 flu pandemic that had infected a third of the world's population, killing more than 50 million people.

While Schuchat warned the public, Acting CDC Director Rich Besser flew to Washington. A telegenic pediatrician, Besser told the president and his cabinet that the CDC would be recommending brief school closures in areas where Besser's disease detectives had identified cases. Obama was clear: All decisions had to be made quickly and grounded in the best available science.

Besser, who recalled the events in an oral history in 2010, said he was then called to another meeting by Rahm Emanuel, Obama's intimidating chief of staff. Obama's top political advisor, David Axelrod, and several cabinet secretaries told Besser that his school closure plan wasn't “going to fly." Among the many problems: kids who counted on schools for meals would go hungry.

“Let me take a stab at rewriting this," Besser recalled Emanuel saying as he began scribbling on a pad.

Besser was flabbergasted. Hadn't the president just said that science was going to drive policy? He looked around, thinking, “I'm the only scientist at this table."

He turned to his new boss, HHS Secretary Kathleen Sebelius. “Madam Secretary, I'm not real comfortable with this," he recalled saying. Sebelius hushed him, urging him to wait. Emanuel read his new version aloud. Then Axelrod spoke. “You know, Rahm," Besser recalled him saying. “I don't think it's a good idea for you to be writing scientific guidance."

Cursing, Emanuel crumpled the paper in his fist, threw it aside and began eating his lunch. At a crucial moment, science prevailed.

In 2020, time and again, the crumpled paper hurled into the corner was the work of the scientists.

In late June, the CDC posted a checklist for reopening schools, which included advice on social distancing and masks. Trump raged on Twitter that he disagreed with the CDC's “very tough & expensive guidelines for opening schools."

One CDC official recalls seeing the July 8 tweet and sighing in defeat. “Come on, man, this is your team! You don't have to tweet it like that! You can just pick up the phone and call Redfield!"

That checklist was supposed to be just the beginning of the agency's advice on school reopening. Everyone nitpicked the CDC's subsequent proposals, records show — even Trump's daughter Ivanka, who suggested granting paid sick leave to teachers and administrators at high risk for COVID-19 complications. In a section that described the higher proportion of cases among Hispanic children, the White House counsel's office wanted the CDC to add a reference to one of the president's favorite bugaboos, the Mexican border.

But the most heated disputes involved an HHS mental health office that emphasized the role of schools as integral to the psychological well-being of children. It chastised the CDC team for writing an overly negative “tome" that was a “recipe for schools to stay closed." The HHS unit was even critical of the suggestion that schools might need to close in areas where the virus was raging uncontrolled. The mental health office scolded the CDC for its “lengthy list of cautions" and said it had written its own guide for parents that had the “opposite tone," records show.

The White House insisted that the mental health office's missive lead the CDC's schools page when it was unveiled in late July. To the outside world, it looked as if the president had snapped his fingers and the CDC caved. Those who bothered to drill down into the real CDC guidance posted beneath were confused by the conflicting messages.

“We didn't know at CDC that it was going to be forced upon us to post it on our website," said an agency staffer involved in the discussions.

Scientists at the agency commiserated, calling it “propaganda."

The HHS mental health office “strongly supports the reopening of schools with appropriate safety measures," a spokesman said in a written statement. “Parents should be equipped with all perspectives to make an informed decision about the whole health of their child."

In August, the White House crafted new guidance from Trump. Titled “SCHOOLS SHOULD SAFELY REOPEN," it contradicted the CDC recommendations on social distancing and masks, and minimized the risks to teachers and students.

The CDC objected, but the White House published it anyway.

The months of defeats were taking a toll. Redfield looked beaten. When his boss, HHS Secretary Alex Azar, upbraided him, he could only mumble, “Yes sir" or “I understand, sir" or “I agree, sir," according to people who heard these exchanges. (Asked about these exchanges, an HHS spokesperson said: “The American people are fortunate to have Dr. Redfield leading the CDC.")

Even Kyle McGowan, Redfield's main protector and an avid political chess player, was running out of moves.

The appointment of McGowan as CDC chief of staff had been a norm-busting move: The 34-year-old was the first political appointee in memory to hold the influential post. He told senior scientists, “I know you think I'm a spy, but I'm really not."

McGowan had managed campaigns for Georgia Congressman Tom Price, who'd received a 100% rating from the American Conservative Union. When Trump appointed Price as HHS Secretary, McGowan followed him. Six months after Price resigned, McGowan was named to the CDC post. He soon won the trust of CDC career staff. “There was a sense that he'd gone native," a senior scientist said.

Before getting on the phone with his fellow political appointees in Washington, he'd call CDC scientists. “What can you live with?" he'd ask, according to people familiar with these conversations.

But McGowan and the CDC were often on the losing side. One of their prime tormentors was Michael Caputo, a political fixer handpicked by Trump himself to oversee communications at HHS. A proud protégé of convicted dirty trickster Roger Stone, Caputo had served as an adviser for Russian politicians, worked for Trump's campaign and promoted conspiracy theories. Soon after arriving at HHS in April, Caputo began riding herd over CDC communications seen as conflicting with Trump's political message. He made it clear that anyone who dared talk to a journalist without approval could be fired.

McGowan warned his CDC colleagues to be careful what they put in writing. “They can read your email," he told them.

McGowan became increasingly protective of the CDC's senior scientists, particularly Schuchat, whose office was adjacent to his. She was viewed as the defender of the agency's principles, the one immortalized as a disease-hunter on screen. With a close colleague McGowan shared worries that she had become a target of the administration's wrath, a symbol of the “deep state" bureaucrats the Trump die-hards believed were bent on destroying the president. She attracted the administration's ire with her blunt assessments in media interviews.

During a June 29 interview with the editor of the medical journal JAMA, Schuchat said that what used to keep her up at night was a fear of an influenza pandemic like the one that struck the U.S. in 1918.

The current pandemic, she said, is similar to “that 1918 transformational experience." And when asked about the rising case numbers in the United States, she said, “I think there was a lot of wishful thinking around the country, that, 'Hey, summer, everything's gonna be fine. We're over this,' And we are not even beginning to be over this."

Schuchat had contradicted Trump's message that life was returning to normal. McGowan told a colleague that he was hearing rumbles that Caputo and others were trying to fire Schuchat. It had come to this: A world famous scientist was in jeopardy for telling the truth.

“Should I be worried, Kyle?" she asked McGowan, according to a person familiar with the conversation, who said McGowan replied: “Not yet."

McGowan reached his breaking point when Redfield asked him to stop the deportation of a dog, according to people who worked closely with him.

In late June, a Peace Corps volunteer evacuated from West Africa was told that the rabies vaccine of her dog, a terrier mix named Socrates, was not valid. Rabies vaccines are marked with pink dye, and a photo of Socrates' vaccination showed a clear liquid, a CDC email said. Border authorities said Socrates had to be sent back to Africa, revaccinated and quarantined there for 28 days before returning. The Peace Corps volunteer sparked a #SaveSocrates outcry on social media.

CDC experts told McGowan that the last foreign dog with rabies that slipped through had cost more than $500,000 in public health charges, including shots for 44 people who had been near the animal, an email shows. Making an exception threatened to render the policy unenforceable for the 500 animals that are deported every year.

At a time when the pandemic had killed nearly 130,000 Americans, McGowan spent an hour and a half on the phone with the HHS general counsel and other senior officials to figure out how to make an exception for a dog. All the while, he told colleagues, his mind kept returning to the fact that the same administration was using the CDC's quarantine power to deport thousands of children at the border with Mexico.

Later that day, Brian Harrison, the HHS chief of staff and a former labradoodle breeder, announced the liberation of Socrates. Secretary Azar tweeted out the news with the hashtag #SaveSocrates.

Privately, McGowan fumed.

“He was sad, downtrodden and defeated," a colleague said. “This was really the final straw for him: How we are going to let dogs in, but basically we're going to require children to be carted off and out of the country? And all in the name of public health."

McGowan resigned in August.

The following month, Caputo took a medical leave after he hosted a live video on his personal Facebook in which he accused “deep state scientists" of “sedition" and warned his followers to stock up on ammunition in anticipation of political upheaval. In that rant, which was reported by The New York Times, Caputo said CDC scientists had only changed out of their sweatpants to meet at coffee shops and plot “how they're going to attack Donald Trump next."

In Atlanta, lawn signs popped up: “I SUPPORT Sweatpants, Coffee Shops and the CDC."

Longtime CDC employees confess that they have lost trust in what their own agency tells the public.

In August, the CDC stunned infectious disease doctors everywhere when it recommended that people who had close contact with a COVID patient didn't necessarily need testing if they didn't have symptoms. Even Butler, one of the highest ranking scientists at the agency, began signing his emails to state and local health departments, “Keep testing, Jay."

Another dismayed veteran who works with local health officials did something he had never done before. He told them to ignore his own agency's guidance. The agency reversed the much-criticized recommendation about testing a month later, but the damage was done. After more than a decade at the CDC, the veteran decided to quit.

“It's just a disappointment," he said. “People's reaction now at other agencies, at state and local public health agencies, when the CDC comes out with a recommendation, they are going to ask: 'Is that the truth? Or is that what you were told to say?'"

Some longtime senior scientists at the CDC are grappling with whether they are too tainted to lead the rebuilding of trust.

“Many of us who might be viewed as complicit need to decide whether we need to leave," one of them said, “Or can we be part of the 'never again' so that the agency never gets this kind of political interference again?"

Four types of scandals utility companies get into with money from your electric bills

Across the country, electric utilities have worked the levers of power to win favorable treatment from state policymakers.

This week, a Richmond Times-Dispatch and ProPublica investigation found that Dominion Energy, Virginia's largest public utility, successfully lobbied to reshape a major climate bill to cover its massive offshore wind project. The move shifted risk from the company's shareholders to its ratepayers. As a result of the legislation, a typical residential customer's bill is projected to increase by nearly $30 per month over the next decade.

Dominion says its wind project is necessary to meet the state's new renewable energy goals. The utility's lobbying success underscores its ability to work through the legislative process in Richmond, where special interests have taken on outsized roles in policymaking.

Elsewhere, utilities have gone much further, crossing the line into potentially criminal behavior.

In Illinois, the largest electric utility acknowledged in July it gave jobs and money to associates of the state House speaker in return for favorable legislation, according to a deferred prosecution agreement with the company in federal court.

In Ohio, a power company allegedly funneled $60 million into a slush fund for a legislative leader in exchange for his backing of a bailout of two nuclear plants. The utility has not been charged, but the elected official now faces a racketeering charge in what prosecutors said was “likely the largest bribery, money laundering scheme ever perpetrated" in the state.

“The temptation for a utility to take its customers' money and spend it on influencing politics and essentially buying off politicians in ways to help them make even more money — it's a temptation that has proven to be pretty irresistible for many utilities," said David Pomerantz, executive director of the Energy and Policy Institute, a utility watchdog group that advocates renewable energy.

Below are four ways electric utilities have tried to influence decision-making within state and local governments.

Secret Political Spending

FirstEnergy is one of the nation's largest electric companies and owns three regulated utilities in Ohio, where the FBI and federal prosecutors are seeking to unravel bribery allegations.

Authorities allege that FirstEnergy contributed $60 million to a group overseen by Ohio House Speaker Larry Householder in exchange for his help passing legislation that provided a billion-dollar bailout of two failing nuclear energy plants. That bill also reduced standards for renewable energy and the energy efficiency programs that save customers money.

Prosecutors have charged Householder with racketeering. He has pleaded not guilty in federal court, and his attorney did not return a request for comment. FirstEnergy has not been charged. A corporate spokeswoman said the company is cooperating fully with the investigation, and its CEO said in a recent earnings call that he firmly believes FirstEnergy acted properly.

According to the criminal complaint against Householder, the company helped the politician win the speaker's office and put the payments into a nonprofit organization called Generation Now, which was supposed to be a social welfare organization. Householder, a Republican, and his allies are accused of instead using the payments from FirstEnergy to expand the speaker's political power and enrich themselves. Three lobbyists — including the former state GOP chairman — and a longtime aide to Householder also were charged. All parties have denied the allegations. The state House stripped Householder of the speakership, but he remains in office.

Ohio's attorney general in September filed a lawsuit against FirstEnergy, Householder, Generation Now and others, seeking to block payment of the nuclear bailout. FirstEnergy said the lawsuit was without merit. “The Attorney General's lawsuit unjustly targets the company for lawfully engaging in the political process and supporting policy initiatives that matter to our customers, employees, communities and shareholders," spokeswoman Jennifer Young said in an email.

In Arizona, the FBI and U.S. Attorney's Office opened an investigation into political spending by the state's largest utility, Arizona Public Service. The companygave millions to “dark money" organizations — political nonprofits that spend money from undisclosed donors — in 2014 to help elect two state regulators. The money flowed to groups with names like Save Our Future Now. The candidates won and in 2017 voted for a utility-backed rate increase.

One of the candidates who received “dark money" funding denied knowledge of the utility's involvement and the second said the idea they could be bought was insulting, the public radio station KJZZ reported.

Arizona Public Service refused for years to admit it was the source of the contributions, but it did so in 2019 at the request of state regulators, according to The Arizona Republic.

A spokesperson for the U.S. Attorney's Office in Phoenix declined to comment on the federal probe. Pinnacle West, the parent company of Arizona Public Service, said in a February filing that the company “understands the matter is closed." Arizona Public Service's CEO said in January that the company would no longer spend, directly or indirectly, on elections for the state regulators who oversee utilities. Company spokeswoman Jenna Rowell said that since 2016 the company has voluntarily published an annual list of its political donations, which are paid by shareholders.

Offering Jobs to Allies

The largest electric utility in Illinois agreed in July to pay a $200 million fine to resolve a federal investigation into bribery.

Commonwealth Edison admitted it arranged jobs, subcontracts and payments for associates of Illinois House Speaker Michael Madigan, a Democrat, as a reward for legislative efforts to help the utility, according to a deferred prosecution agreement with the company in federal court.

Indirect payments through third parties and a consulting company to associates of the speaker from 2011 to 2019 totaled more than $1.3 million. The recipients “performed little or no work for ComEd," according to the documents.

During that time, the utility sought Madigan's support for legislation that kept favorable utility rates for the company. It became law, and the estimated benefit to Commonwealth Edison was more than $150 million.

Madigan has not been charged and denies wrongdoing. If Commonwealth Edison or its parent company “even harbored the thought that they could bribe or influence me, they would have failed miserably," Madigan wrote in a letter last month to a state legislative committee.

A former Commonwealth Edison executive was charged with bribery conspiracy in September and pleaded guilty on Sept. 29 in what was the first conviction in the investigation.

In the wake of the scandal, the company has “taken robust action to aggressively identify and address deficiencies, including enhancing our compliance governance and our lobbying policies to prevent this type of misconduct from ever happening again," spokesman Paul Elsberg said. “We apologize for the past conduct that didn't live up to our own values and are committed to earning back the trust of our communities and partners."

Creating the Appearance of Public Support

Entergy, a utility regulated by the New Orleans City Council, wanted to build a natural gas plant. Critics and community advocates argued that the plant was unnecessary and posed an environmental threat to the area.

To create the appearance of support, a subcontractor for the utility in 2017 paid people to appear and speak at a City Council meeting posing as citizens favoring the plant, an independent investigation concluded. The council approved the gas plant but later fined Entergy $5 million after the investigation, done by a law firm hired by the council, found the company knew or should have known its subcontractors paid actors.

Entergy denied knowledge of the paid actors but said in 2018, “We should have been more diligent and 'we should have known.'" It paid the $5 million fine.

The council allowed the plant to go forward. It began operating in May, a company spokesman said.

Undertaking Mega Projects That Don't Pan Out

Mississippi Power, a unit of Atlanta-based Southern Company, announced plans for a “clean coal" plant in 2006. But the so-called Kemper project shot up in cost from $2.9 billion to $7.5 billion amid missed deadlines and allegations of mismanagement. The facility ended up using only natural gas to generate electricity.

A 2016 investigation by The New York Times found that plant owners understated costs and tried to conceal problems from state regulators.

In response, Southern Company issued a statement saying its project had “garnered enormous support from energy leaders across the U.S. and around the world" and saying the concerns of a former employee were “unsubstantiated."

After media reports about the plant's problems, the company's stock dropped, and shareholders in January 2017 filed a class-action lawsuit alleging Southern Company made false statements and didn't disclose adverse information about the plant's progress. While denying wrongdoing, Southern Company agreed to an $87.5 million settlement last month.

For their part, Mississippi regulators required shareholders to cover $6.4 billion of the plant's cost under terms of a 2018 regulatory settlement. Customers were on the hook for hundreds of millions, though.

“We've endeavored from the very beginning to find a way to take failures at the company and problems that they didn't see coming down the line to make sure we find a way to protect ratepayers," the chairman of the state's public utility commission said at the time.

In South Carolina, federal authorities charged a utility executive with fraud over a failed nuclear proposal. Construction flaws plus cheap natural gas prices and lower-than-expected electricity demand threatened the project — and its ability to receive a federal tax credit. So, prosecutors alleged, the executive misled the public and state regulators about the delays, allowing SCANA Corp. to obtain rate increases.

The executive pleaded guilty in federal court in July to defrauding customers and making false statements to regulators and the public. He agreed to cooperate in the ongoing investigation.

The plant was canceled in 2017, but electricity customers have paid $2 billion for the failed proposal, the newspaper The Post and Courier reported.

SCANA Corp. was later purchased by Dominion Energy.

The deal turned SCANA into Dominion Energy South Carolina and cut rates, but customers still owe $2.3 billion more for the project in the next two decades, The Post and Courier reported.

The Justice Department unleashes prosecutors to potentially intervene in the election

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The Department of Justice has weakened its long-standing prohibition against interfering in elections, according to two department officials.

Avoiding election interference is the overarching principle of DOJ policy on voting-related crimes. In place since at least 1980, the policy generally bars prosecutors not only from making any announcement about ongoing investigations close to an election but also from taking public steps — such as an arrest or a raid — before a vote is finalized because the publicity could tip the balance of a race.

But according to an email sent Friday by an official in the Public Integrity Section in Washington, now if a U.S. attorney's office suspects election fraud that involves postal workers or military employees, federal investigators will be allowed to take public investigative steps before the polls close, even if those actions risk affecting the outcome of the election.

The email announced “an exception to the general non-interference with elections policy." The new exemption, the email stated, applied to instances in which “the integrity of any component of the federal government is implicated by election offenses within the scope of the policy including but not limited to misconduct by federal officials or employees administering an aspect of the voting process through the United States Postal Service, the Department of Defense or any other federal department or agency."

Specifically citing postal workers and military employees is noteworthy, former DOJ officials said. But the exception is written so broadly that it could cover other types of investigations as well, they said.

Both groups have been falsely singled out, in different ways, by President Donald Trump and his campaign for being involved in voter fraud. Trump has repeatedly attempted to delegitimize ballots sent through the postal service, just as the country experiences increased voting by mail spurred by the coronavirus pandemic. He has also raised the specter that the ballots of military members, among whom he enjoys broad support, might be suppressed.

The DOJ and the White House did not immediately respond to requests for comment.

Experts who reviewed the revision said they were concerned it could be exploited to help the DOJ bolster Trump's campaign.

“It's unusual that they're carving out this exception," said Vanita Gupta, the former head of the DOJ Civil Rights Division under President Barack Obama. “It may be creating a predicate for the Justice Department to make inflated announcements about mail-in vote fraud and the like in the run-up to the election."

In a break from long-standing practice last month, a U.S. attorney in Pennsylvania publicly announced that the DOJ was investigating whether local elections officials illegally discarded nine mail-in military ballots. Attorney General William Barr personally briefed Trump on the case before it was publicly announced, The Washington Post reported. Trump later cited it as an example to support his claims of widespread mail-in voter fraud, a false assertion Barr has has helped amplify. It's not clear where the federal probe stands, but Pennsylvania's top elections official said early indications point to an error, not fraud.

The new policy carveout, Gupta said, could be designed to both justify the widely criticized Pennsylvania announcement and open the door for more such moves in the coming weeks.

Justin Levitt, a former deputy assistant attorney general in the DOJ's civil rights division, also expressed concern that the department could be encouraging prosecutors to make more public announcements about incomplete investigations, as they did in the Pennsylvania case.

“It alarms me that the DOJ would want to authorize more of the same in and around the election," he said. “It's incredibly painful for me to say, but given what we've seen recently, Americans shouldn't trust DOJ announcements right now."

The Friday email was sent to a group of dozens of prosecutors around the country known as district election officers. They monitor election procedures and take complaints on Election Day from the public about alleged crimes and serve as the federal points of contact for local election officials.

For decades, the work of federal prosecutors has been guided by a strict policy of non-interference in elections.

A 281-page document titled “Federal Prosecution of Election Offenses" is the handbook for district election officers. The latest edition, from 2017, warns against launching public investigations, without approval granted for extraordinary cases, into alleged fraud before an election is over.

Such a step, the handbook says, “runs the obvious risk of chilling legitimate voting and campaign activities. It also runs the significant risk of interjecting the investigation itself as an issue, both in the campaign and in the adjudication of any ensuing election contest."

One current DOJ official told ProPublica that prosecutors have historically been warned not to allow themselves to be dragged into candidate disputes. “That's what they drill into us: the policy of non-interference and never, ever, ever announce an investigation," the official said.

Debt collectors have made a fortune this year. Now they’re coming for more

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Earlier this year, the pandemic swept across the country, killing 100,000 Americans by the spring, shuttering businesses and schools, and forcing people into their homes. It was a great time to be a debt collector.

In August, Encore Capital, the largest debt buyer in the country, announced that it had doubled its previous record for earnings in a quarter. It primarily had the CARES Act to thank: The bill delivered hundreds of billions of dollars worth of stimulus checks and bulked-up unemployment benefits to Americans, while easing pressures on them by halting foreclosures, evictions and student loan payments. There was no ban on collections of old credit card bills, Encore's specialty.

At the same time, the pandemic compelled households to cut spending. Finding themselves with enough money to settle old debts, people responded to collectors' calls and letters. Debt-buying executives couldn't help marveling at their good fortune. All this created “a perfect storm from a cash perspective," the CEO of Portfolio Recovery Associates, Encore's main competitor, told Wall Street analysts.

After its record second quarter, analysts expect Encore to blow past $200 million in profit this year and reward stockholders with 40% earnings growth compared with last year. Portfolio Recovery is set for similar growth. The share prices of both have soared off their early April lows.

Investors didn't even show much concern when, in early September, the Consumer Financial Protection Bureau sued Encore, saying that it had broken the terms of a consent agreement struck in 2015. The agency had previously charged the company with “pressuring consumers with false statements and churning out lawsuits using robo-signed court documents," as it said at the time. (In a statement, Encore said the CFPB's recent suit was unnecessary because it had fixed the alleged problems “years ago.")

In recent months, the only real bad news for debt buyers was that local courts across the country temporarily shut down. Debt collection lawsuits provide a key source of revenue for the companies, a way to extract payment from consumers, typically low-income, who don't offer it up.

But now even that hiccup is over. After a bit of a lull in the spring, Encore and other debt buyers are back at it, filing suits by the thousands every week, according to ProPublica's analysis of state court filings.

In August alone, Encore filed about 1,000 suits in Indiana and over 2,000 suits in the metro Atlanta area. Other debt buyers jumped back in as well. In Chicago, Portfolio Recovery filed over 3,000 suits in July, while LVNV, a major debt buyer privately owned by Sherman Financial Group, filed over 2,700 suits in Maryland in August. For all these companies, ProPublica found, the volume was well above the number they'd filed before the coronavirus arrived, in January or February of this year. No national numbers on suits exist.

In statements, the companies said they have been actively working with consumers during the COVID-19 pandemic and only sue as a last resort on a small portion of accounts.

Elizabeth A. Kersey, a spokesperson for Portfolio Recovery, said the company's hardship program “allows for the suspension of collection efforts for ninety (90) days upon notification of a hardship event." The company is currently not seeking new orders to seize debtors' wages or bank account funds, she said.

Ryan Bell, an Encore executive, said, “We have consistently and proactively communicated to consumers the various relief options we've put in place in response to COVID-19, including temporarily stopping collections." The company said it had stopped seeking orders to garnish bank accounts. It is, however, seizing wages.

Sherman Financial did not respond to requests for comment.

If Congress is unable to pass any further stimulus , unemployment is likely to remain high. In that scenario, debt buying companies and the banks that sell defaulted accounts to them expect more Americans to fall behind on their credit card bills over the coming months.

Even that scenario turns out to be rosy for the debt buyers. While good times can mean that Encore collects on more debt than it expected, bad times typically bring a glut of people suffering under loans they cannot repay. The result is that Encore can scoop up the raw materials for its profit machine — defaulted accounts — more cheaply. Or as Encore CEO Ashish Masih put it to Wall Street: The company is “particularly excited about the prospects for increased supply in the future."

“The same giant debt buyers known for fighting consumer protection laws at every turn have been raking in cash during this pandemic," Sen. Elizabeth Warren, D-Mass, told ProPublica. “They are now licking their chops in anticipation of profiting even more off families who have their hours further cut or can't find a job, and can't keep up with their bills or their mortgage. This is disgraceful and reinforces the need for Congress to protect consumers and small businesses from this predatory behavior."

In recent years, Encore has bought around 2 million to 3 million U.S. accounts per year, according to public filings. Last year, on average, the company paid 8.6 cents on the dollar for each account. For a typical debt of $3,142, Encore paid $271.

To earn a profit on that investment, Encore and other debt buyers pursue debtors in near perpetuity. Encore is still collecting tens of millions of dollars each year from debts it bought in 2009 or earlier. The key to that persistence is the courts.

Since the early 2000s, debt buyers have flooded local courts nationwide with suits. The companies regularly account for more than a quarter of all debt collection cases in a given jurisdiction, according to ProPublica's review of collection filings over several states.

That disproportionate presence has been particularly apparent in recent months, as the banks themselves have mostly opted to suspend filing new suits. In normal times, Capital One files far more lawsuits than other banks, in numbers similar to those filed by Encore and Portfolio Recovery. But since March, although Capital One continued to seize pay via garnishments secured before COVID-19 struck, it has largely stopped filing new suits.

ProPublica did find one exception among the major banks that commonly file a significant number of suits: Citigroup, which resumed filing suits at its normal levels in July. The bank, for instance, filed over 200 suits in Oklahoma in August, more than it had filed there in January and February combined.

In a statement, Citi spokesperson Jennifer Bombardier said the bank has a special assistance program for customers impacted by COVID-19 and that it is not seeking to garnish the bank accounts of customers it has sued. The bank also did not sell charged-off accounts to debt buyers “for up to 120 days" in the states “most impacted by COVID-19," she said.

Encore sued Nicole Campbell of Brooklyn, New York, in July. Her first task was to figure out what to do. The suit was over $3,023.76 in debt she incurred years ago with CareCredit, a card offered by Synchrony Bank to people who need to cover medical costs, such as dentistry and eyecare. She knew she should answer the complaint by going to the courthouse, but she was wary of going there during the pandemic and wasn't even sure whether it was open.

Even attorneys have difficulty finding their way. “Courts have been returning to full operation, but there's so much confusion as to what's happening," said Susan Shin, legal director of the New Economy Project in New York City. “It's hard to know what to advise people on what to do with their case."

With help from an attorney with the New Economy Project, Campbell responded to the suit by mail. She's not sure what to expect next but said she doesn't have much time to worry about it. She cares for three boys, 5, 11 and 14, on her own and has to figure out how to get them to school on the city's part-time schedule while helping them with online lessons when they're home. She juggles this with her own job as a customer service rep: That also has a rotating, part-time schedule in order to minimize the number of people in the office.

“It's crazy to me they're filing all this during this time when there's so much going on," she said.

Such collection suits are most common among workers with income under $40,000 per year and particularly common in mostly Black neighborhoods. The suits routinely result in judgments, which in turn usually result in attempts at garnishment, according to a ProPublica analysis of Missouri court filings. Past studies have put the number of workers who have their wages garnished each year at around 4 million. In most states, plaintiffs can seize up to a quarter of a worker's take-home pay or clean out their bank account.

In recent years, when state legislatures have moved to protect more funds from garnishment, Encore has been there to oppose the measures. In 2018, a Connecticut bill proposed to automatically protect up to $1,000 in a bank account. An Encore executive, Sonia Gibson, argued against it, writing in a letter, “Since the average amount we collect through bank garnishments is typically around $700, an automatic exemption of $1,000 would leave us unable to use bank garnishments." The bill died.

Last year in California, Encore joined with other debt buyers to combat a similar bill that aimed to protect around $1,700.

“It was a really huge fight," said Ted Mermin, head of the California Low-Income Consumer Coalition and a professor at the University of California, Berkeley, School of Law. “And you've got to think, 'Why?' Who on earth thinks it's a good idea to take someone's last dollar? The only people who would do this are debt collectors who have no ongoing relationship with someone." The bill narrowly passed and became law.

In Washington state, lawmakers last year sought to protect more workers from wage garnishment. Under federal law, earnings above $217.50 in a week are eligible to be seized, a level that has remained the same since 2009 because it's tied to the $7.25 federal minimum wage. The Washington bill, which ultimately passed, aimed to tie the exemption to the state's much higher minimum wage, which this year is $13.50 an hour. In 2020, about $472.50 in weekly take-home pay would be protected. That was much too high for Encore. Gibson argued in a letter that people earning that much shouldn't be “completely exempt from garnishment."

As an alternative to automatic protections, Encore generally argues that consumers should have to file exemptions in court to demonstrate they really can't afford to have their money taken. Consumer advocates say that such exemptions, which often exist in state laws, are rarely invoked by debtors because they either don't know about them or don't understand the process.

On paper, Randall Ward would seem to be well-insulated from garnishment. He lives in the small town of Marianna, Florida, and state law protects the wages of anyone deemed the “head of household," which is defined as someone who earns more than half the household's income and has dependents. Since Ward helps care for his 20-year-old son with Down syndrome and a granddaughter, his pay from his job as a manager at a Waffle House is eligible for protection.

But when Encore, after having won a judgment against Ward the previous year, sought to garnish his wages this past February, Ward didn't understand that he qualified for the “head of household" exemption. So, starting in March, Encore began taking a quarter of Ward's take-home pay. The size of the debt, a Citibank card that had ballooned to $5,220 with interest and court costs, meant that Ward, even with what he's proud to call a “good job," was in for many lean months.

The only way to make ends meet, he said, was to cancel health insurance for himself, his son and his wife, “because I could not pay the bills if I didn't do it."

Then the virus forced his restaurant to close for several weeks and his pay stopped altogether. The family was without income as he waited for his unemployment claim to go through. When, finally, he could go back to work, the garnishments returned. Encore has said in public statements that it looks to work with consumers, especially those who've been impacted by COVID-19. Ward said that was not his experience.

“They're just ruthless about it," he said. “I would hate to see that happen to anybody."

Encore declined to comment on individual accounts.

Collection suits can have a lasting negative effect on consumers. A recent study by economists from Dartmouth's Tuck School of Business and the University of California, San Diego, focused on debtors who, after being sued, agreed to pay in order to avoid garnishment. The settlements left consumers worse off: They were more likely to fall behind on other debts or end up in foreclosure or bankruptcy, the study found. The main reason was that paying up on one debt had drained those consumers' cash buffer and that left them vulnerable to falling behind on others.

Even in good economic times, low-income consumers live on the edge, so the CARES Act aid was particularly helpful to them. According to a Federal Reserve survey, the temporary $600 boost to weekly unemployment insurance benefits actually resulted in higher pay for about 40% of those who received them. On top of that came the $1,200 stimulus checks ($2,400 for married couples) with an additional $500 for each child.

In July, the Fed found households with income under $40,000 a year had significantly more savings than normal: Whereas last year just 39% said they would have covered an unexpected $400 expense with cash, this summer, 48% said they would.

Debt collectors were a clear beneficiary of those extra funds. According to a survey by the Bureau of Labor Statistics, while most people used the stimulus payments to buy food and other essentials, about 25% used at least some of the money to pay down debts.

But Felipe Severino, a Tuck School of Business professor and one of the authors of the paper on debt collection settlements, said there may be negative long-term consequences for households who used the extra money to settle older debts. The companies say they do not charge interest on the old, charged-off debts they collect so the debts are not growing.

“I would argue it's not a very good use of their money," he said. With less of a safety net, those households are more likely to find themselves behind on their bills again.

Furthermore, he said, stimulative government aid like the CARES Act is meant to be “spent and magnify across the economy" in the near term by, for instance, leading to increased purchases at local businesses. That doesn't happen when the money goes to debt collectors.

The flood of government aid, along with the sudden contraction in spending due to COVID-19, has led to an unpredictable economy, one where unemployment has shot up without the usual tide of delinquencies, bankruptcies and foreclosures. But now, banks are predicting that tide to finally arrive in the coming months.

In July, Capital One reported a loss for the quarter despite delinquencies actually going down. The reason was the bank set aside $2.9 billion as a provision for future credit losses, a kind of safety net for the future.

Encore did not appear to need such precautions. “Our liquidity puts us in a strong position to capture the substantial purchasing opportunity, which we believe is sure to follow," Masih, the CEO, told analysts.

The Kushners’ Freddie Mac loan wasn’t just massive. It also came with unusually good terms

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After the news broke in May of last year that government-sponsored lending agency Freddie Mac had agreed to back $786 million in loans to the Kushner Companies, political opponents asked whether the family real estate firm formerly led by the president's son-in-law and top adviser, Jared Kushner, had received special treatment.

“We are especially concerned about this transaction because of Kushner Companies' history of seeking to engage in deals that raise conflicts of interest issues with Mr. Kushner," Sens. Elizabeth Warren, D-Mass., and Tom Carper, D-Del., wrote to Freddie Mac's CEO in June 2019.

The loans helped Kushner Companies scoop up thousands of apartments in Maryland and Virginia, the business's biggest purchase in a decade. The deal, first reported by Bloomberg, also ranked among Freddie Mac's largest ever. At the time, the details of its terms weren't disclosed. Freddie Mac officials didn't comment publicly then. Kushner's lawyer said Jared was no longer involved in decision-making at the company. (He does continue to receive millions from the family business, according to his financial disclosures, including from some properties with Freddie Mac-backed loans.)

Freddie Mac packaged the 16 loans into bonds in August 2019 and sold them to investors. But Kushner Companies hadn't finished its buying spree. Within the next two months, records show, Freddie Mac backed another two loans to the Kushners for an additional $63.5 million, allowing the company to add two more apartment complexes to its portfolio.

A new analysis by ProPublica shows Kushner Companies received unusually favorable loan terms for the 18 mortgages it obtained with Freddie Mac's backing. The loans allowed the Kushner family company to make lower monthly payments and borrow more money than was typical for similar loans, 2019 Freddie Mac data shows. The terms increase the risk to the agency and to investors who buy bonds with the Kushner mortgages in them.

Moreover, Freddie Mac's estimates of the Kushner properties' profitability — a core element of any decision to back a loan — have already proven to be overly optimistic. All 16 properties in the firm's biggest loan package delivered smaller profits in 2019 than Freddie Mac expected, despite the then-booming economy. The loan for the largest property lagged Freddie Mac's profit prediction by 31% last year.

U.S. taxpayers could be responsible for paying back much of the nearly $850 million in Freddie Mac financing if Kushner Companies defaults and its properties drop significantly in value. Freddie Mac said that's unlikely. But during the last real estate crash, taxpayers had to bail out the agency and its larger sibling, Fannie Mae, to the tune of $190 billion as the agencies plunged into the government equivalent of bankruptcy. (The agencies ultimately repaid the money and more.)

The involvement of Jared's sister Nicole Kushner Meyer adds to questions about whether the family sought to exploit its political influence. Meyer, who shares her brother's slight build, porcelain features and dark chestnut hair, lobbied Freddie Mac in person on behalf of Kushner Companies in February last year, a timeline of the deal obtained by ProPublica shows. She has previously drawn criticism for invoking her brother's name while doing Kushner Companies' business.

In a statement, Freddie Mac said it does “not consider the political affiliations of borrowers or their family members." It called ProPublica's analysis “random, arbitrary and incomplete" and asserted that the Kushner loans “fit squarely within our publicly-available credit and underwriting standards. The terms and performance of every one of these loans is transparent and available on our website, and all the loans are current and have been consistently paid."

A spokesperson for Kushner Companies did not respond to calls and emails seeking comment. Emails to the White House seeking Jared Kushner's comment were not returned.

There's no evidence the Trump administration played a role in any of the decisions, and Freddie Mac operates independently. But Freddie Mac embarked on approving the loans at the moment that its government overseer, the Federal Housing Finance Agency, or FHFA, was changing from leadership by an Obama administration appointee to one from the Trump administration, Mark Calabria, Vice President Mike Pence's former chief economist. Calabria, who was confirmed in April 2019, has called for an end to the “conservatorship," the close financial control that his agency has exerted over Freddie Mac and Fannie Mae since the 2008 crisis.

The potential for improper influence exists even if the Trump administration didn't advocate for the Kushners, said Kathleen Clark, a law professor at Washington University specializing in government and legal ethics. She compared the situation to press reports that businesses and associates connected to Jared Kushner and his family were approved to receive millions from the Paycheck Protection Program. Officials could have acted because they were seeking to curry favor with the Kushners or feared retribution if they didn't, according to Clark. And if Kushner Companies had wanted to avoid any appearance of undue influence, she added, it should have sent only nonfamily executives to meet with Freddie Mac. “I'd leave it to the professionals," Clark said. “I'd keep family members away from it."

The Freddie Mac data shows that Kushner Companies secured advantageous terms on multiple points. All 18 loans, for example, allow Kushner Companies to pay only interest for the full 10-year term, thus deferring all principal payments to a balloon payment at the end. That lowers the monthly payments but increases the possibility that the balance won't be paid back in full.

“That's as risky as you get," said Ryan Ledwith, a professor at New York University's Schack Institute of Real Estate, of 10-year interest-only loans. “It's a long period of time, and you're not getting any amortization to reduce your risk over time. You're betting the market is going to get better all by itself 10 years from now."

Interest-only mortgages, which notoriously helped fuel the 2008 economic crisis, represent a small percentage of Freddie Mac loans. Only 6% of the 3,600 loans funded by the agency last year were interest-only for a decade or more, according to a database of its core mortgage transactions.

Kushner Companies also loaded more debt on the properties than is usual for similar loans, with the loan value for the 16-loan deal climbing to 69% of the properties' worth. That compares with an average 59%, according to data for loans with similar terms and property types that Freddie Mac sold to investors in 2019, and is just below the 70% debt-to-value ceiling Freddie Mac sets for loans in its category. “What we generally have seen from Freddie and Fannie," said Andrew Little, a principal with real estate investment bank John B. Levy & Company, “is they will do 10 years of interest-only on lower-leveraged deals."

Loans right at the ceiling are “not very common," Little said, adding that “you don't see deals this size that commonly."

Meanwhile Freddie Mac and its lending partner overestimated the profits for the buildings in the Kushners' 16-loan package by 12% during the underwriting process, according to the agency's data. Such analysis is supposed to provide a conservative, accurate picture of revenue and expenses, which should be relatively predictable in the case of an apartment building.

But the level of income anticipated failed to materialize in 2019, financial reports show. The most dramatic overstatement came with the largest loan in the deal, $120 million for Bonnie Ridge Apartments, a 960-apartment complex in a suburban part of Baltimore. In that case, realized profits last year were 31% below what Freddie Mac had expected.

“That's definitely a significant amount," said John Griffin, a University of Texas professor who specializes in forensic finance and has studied mortgage underwriting. He co-authored a recent paper highlighting as worrisome loans in which projected profits exceeded actual profits by 5%. “It's a problem when underwritten income is inflated or overstated," he said. “That is a key metric that determines the safety of the loan."

Griffin's paper found that 28% of all loans examined had projected profits that were 5% or more greater than what the properties actually earned in their first year. Some instances of underperformance could be caused by bad luck, the paper acknowledged, but “such situations should be relatively rare." Yet in the case of Freddie Mac's estimates in the Kushner deal, 13 of the original 16 loans met or exceeded the 5% threshold — many by a considerable amount.

Freddie Mac said it followed normal underwriting guidelines in assessing the Kushner buildings, including securing an independent appraisal and looking at historical property performance. It said investors who examined the riskiest portion of the debt also expressed no concerns.

If the underwriting had been on target, and reflected lower expectations, the loans would still have been within Freddie Mac's credit parameters, data shows. But the resulting analysis would have suggested the Kushner Companies has a smaller cushion to sustain its loan payments. It could also have affected the interest rate the company pays. Thinner margins accompanied by relatively high rates of debt provide less wiggle room if the properties, or the economy, run into trouble. As Kushner Companies has seen before, that wiggle room can disappear quickly.

Freddie Mac's main business has historically been buying bundles of home loans from the lenders that originated them, then selling them to investors as securities. The arrangement takes the debt off banks' balance sheets, freeing them to make more loans. Freddie Mac and Fannie Mae are privately owned, but they have been financially backstopped by the federal government and are required to meet goals for lending on affordable housing.

Single-home loans are still Freddie Mac's primary business, but since the 2008 economic crisis, the agency has greatly expanded its financing of apartment complexes.

Apartment complexes have been the specialty of the Kushner family, whose real estate holdings have spanned the mid-Atlantic and Midwest in recent years, with thousands of units scattered across suburbia. The company sold off 17,500 apartments in 2007, after the family's patriarch, Jared's father, Charles Kushner, returned from prison for convictions on illegal campaign contributions, tax evasion and witness tampering.

After Jared became CEO in 2008, the company turned its ambitions to high-profile commercial properties in New York City, a foray that turned sour. In 2018, the company gave up control of its marquee $1.8 billion building and headquarters, 666 Fifth Avenue, after being unable to keep up with its loans. Another piece of prime Kushner Companies Manhattan real estate, retail space in the old New York Times building near Times Square, was headed for a potential default in 2019, and foreclosure. (The New York Times reported in August that the foreclosure action was put off at the last minute, so negotiations with a lender could continue.)

Kushner Companies eventually resumed its residential focus and began bulking up its apartment portfolio. In the eight years before Trump entered the White House, the company and its partners secured a total of $581 million in Freddie Mac financing, according to data from the firm Real Capital Analytics first published by Bloomberg. By the end of 2018, Kushner Companies had amassed 21,000 apartment units.

Some of those loans didn't fare well. They included a series of supplemental loans, or second mortgages, taken out on properties in Maryland that Kushner Companies owned in partnership with others (the size of the Kushner share was not clear). Landlords often use such second loans as a way to extract large amounts of cash from their holdings.

A lender had originated 10 such loans to Kushner Companies and its partners in 2015, and Freddie Mac planned to sell them to investors, or securitize them, once the properties demonstrated income consistently high enough to cover the debt payments. For four of the properties, however, profits dipped in 2016, and two more were in little better shape. Freddie Mac still hadn't securitized the six loans, for $40 million, by inauguration day in 2017.

Mortgage industry experts say poor profits at underlying properties can lead Freddie Mac to delay selling off the loans as bonds, fearing they will be rejected by investors. By the time Freddie Mac offloaded the last of Kushner's second mortgages in April 2017, they had racked up above-average lag times between their origination and securitization, compared with other loans in their debt packages, data shows. (Freddie Mac said the wait time was normal.)

Within 10 months of the sale of the loans to investors, one of the complexes landed on the servicer's watchlist for mortgages at a heightened risk for default. Another soon followed, and another the year after that. All 10 complexes, which were built in the early 1970s or earlier, exhibited upkeep issues alarming enough to earn a flag in Freddie Mac data for “deferred maintenance" problems. (A Freddie Mac spokesman said the issues identified were almost all related to exterior asphalt and concrete, with one instance of an exterior drainage system in need of repair.)

At one property, a representative of Kushner Companies and its partners blamed residents of the nearby neighborhoods, who are primarily Black and low-income, for its declining profits and a rash of evictions: “The main driver is the client base in the area," the servicer reported the borrower as saying, Freddie Mac records show.

Kushner Companies had other problems, too. In 2017, ProPublica reporter Alec MacGillis documented the company's practice of charging aggressive, and what some tenants' lawyers called illegal, fees to occupants of some of those complexes. Tenants also claimed Kushner Companies' property management arm, Westminster Properties, at times neglected basic repairs and allowed the property condition to deteriorate, including raw sewage flowing out of one kitchen sink.

The complaints spurred a lawsuit filed in October 2019 by the attorney general of Maryland, Brian Frosh. Frosh accused the management company and its partners of charging “illegitimate fees" and having “rented apartments and townhomes to consumers that are distressed, shoddily maintained, and have conditions that can adversely impact consumers' health and well being." (Westminster has defended its conduct in legal filings for the suit, which remains active.)

Kushner Companies first approached Freddie Mac in August 2018 through Berkadia Commercial Mortgage, then abandoned its application without explanation in mid-October of that year. Berkadia did not return messages seeking comment.

In February 2019, Berkadia approached Freddie Mac again and informed the agency that Kushner Companies wanted to move forward. It's not clear what explains the renewed interest. But two things had changed in the interim. The rates on 10-year Treasury bonds had dropped, a circumstance that typically fuels borrowing and the securitized lending that Freddie provides. And the Obama appointee in charge of the FHFA was gone, leaving an interim Trump appointee in place.

Six days after rekindling its interest, Nicole Kushner Meyer and two Kushner Companies executives, President Laurent Morali and Chief Operating Officer Peter Febo, met with Freddie Mac officials, along with representatives of Berkadia and an advisory firm, documents show. The records don't say which Freddie Mac officials attended. The meeting covered the “business plan for assets, track record and general overview of the Kushner Companies." Meyer followed up, documents say, sending multiple emails to a senior Freddie Mac official, who was not identified.

Meyer has been serving as a principal at Kushner Companies since 2015, according to her LinkedIn profile. She caused a stir in 2017, when she invoked her brother on a trip to China to pitch potential investors for a Kushner Companies development in Jersey City, New Jersey. The company was seeking investors to participate in a government program known as EB-5, which grants visas to foreigners who make high-dollar investments intended to create jobs in struggling areas.

Freddie Mac said Meyer did not mention Kushner by name during the meeting. The agency also said no one connected to the White House asked that the deal be done.

But the political sensitivity was obvious to Freddie Mac, whose officials emailed each other in the weeks after the meeting, expressing a desire to minimize press coverage of the deal, according to a person with knowledge of the situation. They also took the unusual step of notifying FHFA, their regulator, of the transaction, the timeline shows. Freddie Mac and FHFA both declined to say why Freddie made the notification except to say that it was necessary as part of the agency's conservatorship. (One source suggested deals above a certain dollar amount require such notification.)

In March, Kushner Companies was able to move fast to lock in a favorable interest rate, documents show. It submitted a financing application, which is needed to request a lock on a component of its interest rate. Freddie Mac's website says that single loans are eligible for such a procedure, but that groups of loans must obtain additional approval. The day after Kushner Companies submitted its application, documents show, Freddie locked the rate for all 16 mortgages.

Through a spokesman, Freddie Mac said that such locks are an important part of its business model, and that timing is at the borrower's discretion.

Kushner Companies' full-term interest-only loan proved exceptional in another way: Freddie Mac had granted Lone Star Funds, a private equity firm managing $85 billion in global investments, interest-only terms for only the first three years of its seven-year mortgages when it had acquired the same apartment complexes in 2015. As a result, Lone Star had been able to borrow more money. But it soon faced a sharp hike in its monthly payments, when it added principal to interest.

(Freddie Mac said full-term, interest-only loans are more common when the pool of mortgages examined is restricted to larger, conventional loans. Nonpublic data shows they made up roughly 20% of such loans over the last three years, the agency said.)

Freddie Mac completed its due diligence for the Kushner Companies deal and on May 22 of last year, Kushner Companies and its partner, Torchlight Investors, took ownership of the 16 properties, with $785,803,000 in loans pledged. Torchlight did not respond to questions.

The properties were largely in the Washington, D.C., and Baltimore suburbs. Their average construction date was 1980, almost a decade older than the other properties Freddie approved for similar loans in 2019.

From a profit standpoint, the 16 properties were a mixed bag. Appraisers pegged their value as having increased 2% overall in the previous four years. Four of the properties lost value, according to the analysis.

The Kushners also benefited from another provision that increased the deal's risk. Groups of loans are often cross-collateralized, meaning that if one defaults, the lender can seek to seize others to recoup their losses. The strategy provides an extra hedge against risk for the lender. The Lone Star properties were cross-collateralized under their previous loan. But not those for Kushner Companies. (A Freddie Mac spokesman said cross-collateralization is not required and each of the company's loans met credit parameters without it.)

Another curious phenomenon emerged in the disclosures for the new loans: The reported profits for seven of the Kushner buildings in 2017 were higher than those listed for the same buildings and same year in prior loan documents. For some properties, the difference was slight. But for others, it was more substantial. At one Kushner complex, for example, the Apartments at Cambridge Court in suburban Baltimore, the 2017 net operating income was nearly 6% higher in the new loan filing than it had been for the same year in an old disclosure.

In May, ProPublica reported a pattern of similar discrepancies in bonds that hold mortgages across the commercial real estate industry. And the paper by Griffin, the University of Texas finance professor, and his colleague Alex Priest also found a pattern of such profit alterations, suggesting multiple institutions are manipulating historical financials to downplay risk and bolster more aggressive lending.

Financial data on how the 18 Kushner properties are faring in this year's economic slump is not yet available.

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War hero turned troll: Man who raised millions for border wall uses social media to attack his detractors

Sept. 29, 2020

"Veteran, war hero, defendant, troll: Man who raised millions for border wall uses social media to attack his detractors" was first published by The Texas Tribune, a nonprofit, nonpartisan media organization that informs Texans — and engages with them — about public policy, politics, government and statewide issues.

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War hero. Veterans advocate. Family man.

It was an image years in the making. Brian Kolfage had lost three limbs in an Iraq bomb blast in 2004, making him the most badly wounded airman to survive the war. He had become a motivational speaker, was the subject of sympathetic news profiles and was even a guest at former President Barack Obama's State of the Union address in 2012.

More recently, 38-year-old Kolfage had positioned himself as a border security visionary after raising $25 million to construct privately funded fences in an effort to help President Donald Trump keep undocumented immigrants from crossing the southern border.

On social media and in the lucrative industry of online news sites dedicated to far-right politics, there's a very different Kolfage, though. One who, over the last decade, has sharpened a strategy of retribution and retaliation against his online critics, asking his legion of followers to “expose" perceived enemies and “make (them) famous," according to numerous interviews, hundreds of screenshots of since-deleted social media posts and court records from two defamation lawsuits to which he was a party.

Kolfage's actions online have spawned an informal support group of individuals who have felt his wrath, including fellow veterans and progressives, as well as some of Kolfage's former conservative allies. His social media activity has forced him to formally apologize to a perceived online critic as part of a court settlement and prompted a judge to issue a warning following his recent indictment on fraud charges.

Facebook has barred Kolfage from its platform for his online behavior, which includes creating multiple fake accounts and linking to “ad farms," a company spokeswoman said, adding that his actions violated “our rules against spam and inauthentic behavior."

Neither Kolfage nor his attorney responded to requests for comment. He's previously said his social media approach is in response to negative comments that others publish about him, such as allegations of fraud.

Kolfage, along with three others, including former White House chief strategist Steve Bannon, are charged with defrauding thousands of donors to Kolfage's nonprofit, We Build the Wall. Prosecutors allege the men deceived donors by using Kolfage's public persona and his pledge not to take a dime in salary. Instead, Kolfage pocketed more than $350,000, according to the indictment. The men have pleaded not guilty.

So far, the nonprofit has helped build two private wall projects, including one in the Rio Grande Valley that a ProPublica/Texas Tribune investigation found could topple into the river if not properly fixed and maintained.

Kolfage has unleashed his growing army of followers on critics and opponents of those projects, including local elected and wildlife refuge officials and a priest. Death threats followed.

The National Butterfly Center, next door to the border fence built in the Rio Grande Valley, “openly supports illegal immigration and sex trafficking of women and children," Kolfage tweeted last year. Facebook and Twitter messages calling staffers “pigs," “pathetic filth" and “traitors" poured in. “You will be made to pay," one Facebook follower declared in a message.

To those who know him, Kolfage's online attacks reflect a pattern.

“His whole identity is wrapped up in people rolling out the red carpet for him, in being this war hero," said Lindsay Lowery, who worked for Kolfage for about a year at his Freedom Daily website in 2017. “If anyone challenges that, he gets very nasty and vindictive. Facebook is his echo chamber." Lowery said she left after she grew frustrated with what she called “clickbait" peddled by the right-wing site.

Mary Anne Franks, a law professor at the University of Miami and an expert on the intersection of civil rights and technology, said: “One of the disturbing trends in online harassment is that when you have enough followers or you are notorious enough, you don't actually have to do the dirty work yourself." She added, “All you have to do is throw out some inflammatory comments about a particular person and your followers are going to do the rest."

Courtesy of Louis Caponecchia Courtesy of Louis Caponecchia

Though Kolfage is technically barred from Facebook, the world's largest social media platform continues to allow him to reach his 683,000 followers with antagonistic posts because it says a fan page bearing his name is operated by seven individuals across the country and, thus, “he is not posting personally," the Facebook spokeswoman said.

A scroll through Kolfage's fan page shows many of the posts are written in the first person, which Facebook said is allowed since he is not a designated hate figure. As of Sept. 23, the name of the principal page owner was similar to that of Kolfage's wife, Ashley — the same person listed as running Bannon's fan page. But the owner of Kolfage's page was changed to Brian Kolfage after ProPublica and the Tribune asked the Kolfages about it.

Facebook said that is also allowed, even for a barred figure, as fan pages have the option of listing their public figure as owner. A spokeswoman reiterated that Kolfage himself is not the actual administrator since “he does not have access to Facebook because he cannot have a Profile." Facebook did not say how it would prevent Kolfage from accessing the site through the account of someone close to him such as his wife.

Regardless of who is posting, since his indictment, Kolfage has found a new target: the United States Attorney's Office for the Southern District of New York.

His Facebook fan page has repeatedly blasted prosecutors as “corrupt" and motivated by politics. A recent Facebook post garnered more than 1,500 angry comments supporting him.

“I see public hangings on the White house lawn," one person commented on a recent post about why the indictment was a political hit job, adding, “Obama should be 1st."

When prosecutors complained that the posts on Kolfage's Facebook page could taint a potential jury pool, his attorney, Harvey Steinberg, argued in a hearing that the First Amendment gave his client the right to comment on the case. Though she did not issue a gag order, U.S. District Judge Analisa Torres said she may do so if the behavior continues.

And it has. Since the ruling, a steady stream of posts on Kolfage's fan page have labeled prosecutors a “wing of Antifa" acting with “malicious" intentions.

Some of those on the receiving end of Kolfage's previous online behavior say they have forever been changed.

Jackie Millinor, 64, a Massachusetts Air Force veteran and executive assistant, found herself in the middle of a social media showdown with Kolfage and his Facebook followers seven years ago. She came onto Kolfage's radar after trying to end the harassment of a 61-year-old woman she had never met. Kolfage claimed the retired union representative had made a disparaging comment against him and veterans in general.

In response to her advocacy for the woman, Millinor said, Kolfage's followers published her address and phone number on Facebook, which was shared widely. She said Kolfage contacted her employer through since-deleted tweets, asking that she be fired for harassing a wounded warrior. She said the attempt didn't work, but the stress landed her in the hospital with gastrointestinal issues that required a blood transfusion.

Millinor is the founder of the informal Facebook support group of those who say they were targeted by Kolfage.

“It broke a piece of me," Millinor said recently. “I'm not the same person now as before, after what Brian Kolfage did to me. My own family members thought I was crazy."

• • •

Massachusetts resident Jan Vrotsos would get on Facebook to play games, wish friends happy birthday and keep up with their lives, she said.

But a 2013 post offering a family her condolences for losing their little girl to cancer — an illness she said she was then battling herself — placed her in the middle of an internet rabbit hole of fake pages, trolls and cyberbullies she knew nothing about.

It turns out Vrotsos had commented on a fake page Kolfage and others had set up to catch the administrator of a satirical liberal page called Republican Family Values that had used a picture with Kolfage's baby as part of a meme making fun of his family.

Someone, it's unclear who, then posted a fabricated comment to Kolfage from Vrotsos calling disabled veterans worthless. “I hope you die a miserable death you worthless fake hero. You and your family will be a burden on tax payers your entire life," the fake message read, accompanied by Vrotsos' profile picture of her standing in front of a sunflower field with her cocker spaniel, Buddy.

The post went viral. It was shared by Kolfage and his followers, along with Vrotsos' picture, email and home address, as well as the phone numbers of her and her mother.

“This lady is enjoying her freedom at the expense of my legs and hand and enjoys bashing wounded warriors," Kolfage wrote on social media. “EXPOSE HER." It was liked by nearly 1,300 people and shared more than 12,000 times.

Courtesy of Louis Caponecchia Courtesy of Louis Caponecchia

Almost immediately, Vrotsos' then 81-year-old mother started getting calls to tell her daughter to get her affairs in order. Vrotsos received hundreds of threats, including one that said that they hoped she got “mugged and raped at gunpoint by a aids ridden piece of filth."

Vrotsos filed a police report with the Medford Police Department on Dec. 30, 2013, detailing the harassment. But police told her there was little they could do to help. One officer told her that because of the “1st Amendment and free speech" most of her complaints “except real threats and intentional ID theft" were civil in nature and that she should get an attorney.

“The Medford Police Department simply does not have the resources to investigate all the Internet threats and harassments coming to Jan Vrotsos from around the country and from many different sources," the report concluded.

But what bothered her the most, she said in a recent phone interview, is that the harassers found out where her dad was buried, and that they threatened to dig up the World War II veteran and “piss on his grave."

“I was petrified," she said. She didn't leave her house for weeks. It would be years before she stopped looking over her shoulder, afraid people would recognize her.

Before all of this, she said she had no idea who Brian Kolfage was.

• • •

Born in Michigan and raised in Hawaii, Kolfage joined the Air Force and at one point was stationed at Goodfellow Air Force Base in San Angelo, Texas, where he met his wife, Ashley. In 2004, two weeks into his second deployment to Iraq, a rocket exploded a few feet from him, severing both of his legs and his right hand.

The Purple Heart recipient recovered after undergoing 16 surgeries in six months, enrolled in architecture school and often spoke publicly about his experience, becoming the face of resilience and perseverance.

In addition to being former Democratic Arizona congresswoman Gabrielle Giffords' special guest to the State of the Union address, Kolfage served on her veteran's advisory council.

“We were just absolutely astounded when we met him," Giffords' then-district director Ron Barber told Cronkite News in January 2012. “His attitude, his positive view of the world despite the fact that he's lost three limbs. It was just extraordinary and inspiring."

A year later, however, Kolfage was sharing conspiracy theories and calling Obama “a halfbreed" on Facebook.

He would soon begin running a number of right-wing websites and Facebook pages that he claimed earned him as much as $200,000 per month, according to text messages reviewed by ProPublica and the Tribune. The sites included sensationalized, photoshopped and in some cases fabricated content, and several were shut down by Facebook for “inauthentic activity" in 2018.

“It got really crazy by the end with photoshopped images all the time," said Lowery, Kolfage's former Freedom Daily employee. “I said I'm not going to profit off of lies."

A text exchange between Lowery and Kolfage viewed by ProPublica and the Tribune shows one example: a fake picture of Hillary Clinton being led away in handcuffs with the headline: “TRUMP'S DOJ JUST DID IT!!! It's FINALLY happening!!!" Questioned about the photo, Kolfage tells Lowery: “it's just a graphic. Best story of the day."

After Lowery quit, Kolfage accused her of trying to lure his employees away to another site, Lowery said. She believes that in retaliation he made false reports to the FBI and her husband's employer that she was a security threat, a claim previously reported by BuzzFeed.

Lowery said that she shared threatening texts from Kolfage, which included the warning to “start hiding your tracks," with the FBI and her husband's employer, and that their inquiries ceased soon after.

Online, Kolfage continued to leave a trail of bullying and personal attacks. While Kolfage has deactivated many of his previous social media accounts, including Twitter, which he closed soon after the indictment, court documents and more recent, undeleted social media activity indicate similar behavior. This week he rebooted his Twitter account to post about the “politically corrupt" case against him.

• • •

That vitriol toward Vrotsos is what caught the attention of others, including vets like Millinor, who went on social media to confront Kolfage in her defense.

It also brought out the worst in people. Some went after Kolfage, leading to mutual online attacks, fake social media pages from both sides, the release of personal information of members of the informal support group and calls from Kolfage to his followers to report them to their employers. Kolfage launched a defamation lawsuit against half a dozen online opponents.

Kolfage and his wife demanded the removal of social media posts calling him names such as Nazi and “pill-addled junky" as part of their defamation lawsuit.

Back then, Kolfage told Fox 10 Phoenix that he felt he needed to take legal action after adversaries started going after his family and tried to ruin the career of his wife, who was a teacher and a model.

“They would say they wished I had died, they said I was a drain on the government system, just really nasty stuff. I started sharing the comments, and it went viral," he said. “Because I was just fed up with it."

The judge ruled in favor of several of the defendants and dismissed the case in 2015. Some defendants reached a settlement with Kolfage that included an agreement to not publish anything about the other and to remove disparaging statements where possible.

As part of the settlement, Kolfage also apologized to Vrotsos for sharing her public information.

“I published Jan's information on my public Facebook page and I regret anything that transpired to Jan as a result of that," Kolfage wrote in a signed statement submitted to the U.S. District Court of Arizona on June 30, 2015.

via U.S. District Court of Arizona via U.S. District Court of Arizona

On Facebook, Kolfage said he didn't believe Vrotsos had authored the post and blamed trolls whose goal was to cause as much misery as possible. “I want to apologize on behalf of my supporters to Jan, who were sucked into this whirlwind and participated in any malevolent behavior," he wrote. “It is my sincere hope that this can be a learning experience for everyone (including the people who are attacking my family wrongfully) and that we can all put this behind us."

After that experience, Vrotsos says she now tries to be more careful online. “I don't want anything to start up again," she said.

Louis Caponecchia, a Navy veteran who was among those who prevailed after being sued by Kolfage, said many people who tangled with Kolfage have gone into hiding online.

“These are regular people, they've never had 10 angry messages on Facebook before and then to get dozens, your average person has no idea how to deal with all that stuff," he said. “It's pretty easy to scare and intimidate people. Me, I have a big mouth and nothing to lose. I fought back and that really enraged him."

Caponecchia has traded online barbs with Kolfage and his supporters and been temporarily barred from Facebook, which he blamed on Kolfage directing his followers to flag his posts. He also operates a blog aimed at uncovering what he says are Kolfage's misdeeds.

Last year, as Kolfage led his nonprofit's private border wall projects, his social media attacks would escalate even more.

• • •

We Build the Wall's first project was a half mile of fencing in Sunland Park, New Mexico, just outside El Paso, where Kolfage grew furious when local officials halted construction because of a lack of building permits.

“Burn up the phone lines and email guys!" reads a post on Kolfage's Facebook fan page, which also included the address and phone number of Sunland Park City Hall and direct contact information for the mayor and city manager. “Ask them who was paid off by the cartels! WE WON'T STOP! YOU DON'T STOP!"

In response, Sunland Park Mayor Javier Perea said he received several death threats and thousands of messages, some telling him to watch his back or that they were going to release his personal information. “You are one major piece of un American piece of crap," one email read.

He told ProPublica and the Tribune that more than a year later he still had thousands of emails he hadn't gone through.

“Their intention was to bring attention to the issue and fundraising," Perea said, “because shortly thereafter, they were able to fundraise millions of dollars for their project."

The International Boundary and Water Commission, headquartered in El Paso, was also on the receiving end of harassment after agency officials opened a gate We Build the Wall constructed on federal property without permission.

In response, Kolfage encouraged his fan page followers on Facebook and Twitter to call the binational government agency and demand they “#CloseTheGate." He also accused its commissioner, Jayne Harkins, a Trump appointee, of letting unauthorized immigrants into the country and undermining the president.

The commission received hundreds of calls from his supporters.

“The typical message would be somebody would call and say 'open the gate' and hang up," said Sally Spener, a spokeswoman for the commission. “It made it difficult for us to receive other business-related calls and our job."

More than a year after construction of the half-mile stretch of fence, Spener said, We Build the Wall hasn't fulfilled all of the requirements set out by the agency, including an operation and maintenance plan and evidence of financial responsibility for damage or injuries that can be caused by the gate.

In response to questions about his allegations and social media claims, Kolfage told ProPublica and the Tribune in July that the border is loaded with corruption. “It was border patrol agents who alerted us that the very first people to come out strong against our wall were the ones paid off," he wrote in an email.

In the Rio Grande Valley, Kolfage accused the National Butterfly Center of enabling sex trafficking and sent what executive director Marianna Treviño-Wright considered a threatening tweet claiming that there were “snipers in your bushes doing security for our team."

Treviño-Wright, who has filed a defamation lawsuit against Kolfage, said she was unprepared for being publicly labeled a human trafficker. “Once there was blood in the water, his buddies and bots and We Build the Wall donors were sharks."

But she said Caponecchia, a onetime target of Kolfage's, reached out during the social media assault, offering advice and guidance. “I could ask Louis questions and bounce things off of him, what we might anticipate."

A longtime opponent of the border wall, Treviño-Wright said she was forced to take security precautions at her home and office and reported what she considered suspicious activity near the butterfly center to local and federal authorities.

“There is no way to insulate yourself and family from the online attacks or from those people showing up like … militia people," she said. “I think the prosecutors and judges (involved in the Kolfage criminal case) need to understand they now have targets on their backs."

The criminal indictment has brought relief to some of Kolfage's past targets, who say they are looking forward to his trial in May 2021.

“All the fear I've been holding all these years just went away," said Millinor, the Air Force veteran. “I said: 'You know what, I'm not going to hide anymore. Come hell or high water I will be in that courtroom.'"

Disclosure: Facebook has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.

This article originally appeared in The Texas Tribune at

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