Small-business bill clears Senate hurdle
Bipartisanship prevails after amendments are defeated
A House Republican legislative package aimed at easing securities regulations for small businesses passed a key test vote in the Senate on Wednesday, clearing a path for one of the first significant bipartisan bills to pass Congress this year.
The Democrat-controlled Senate voted 76-22 to end debate on the socalled Jobs Act and proceed to a final vote Thursday. The measure is expected to pass, though not before Democrats try a final time to make changes.
On Tuesday, the Senate voted down two Democratic amendments: a substitute version of the bill intended to beef up investor protections and a provision to extend the life of the federal ExportImport Bank.
Before Thursday’s final-passage vote, the Senate will take up two more Democratic amendments regarding investor protections and transparency. Approval would send the bill back to the House for further consideration.
“The bill is imperfect, and that perhaps is an understatement,” said Senate Majority Leader Harry Reid, Nevada Democrat. “Those two amendments are not going to make this bill perfect, but it’s going to make the bill a lot better.”
The House package includes six bills, three of which previously passed the chamber with wide bipartisan support but stalled in the Senate. House GOP leaders repackaged the measures, and the bundle easily passed the House earlier this month.
The Jobs Act is designed to reduce bureaucratic red tape by easing some Securities and Exchange Commission regulations, giving small businesses better access to capital.
One of the bills would make it easier for small businesses to go public by increasing the offering threshold for companies exempted from SEC registration to $50 million from $5 million. The measure initially passed the House in November by a vote of 421-1.
“This [package] is exactly the kind of thing Americans have been asking for — greater freedom and flexibility,” said Senate Minority Leader Mitch McConnell, Kentucky Republican. “That’s one of the reasons it’s had such overwhelming bipartisan support.”
No Republican senators voted against the package.
If the Jobs Act passes the Senate, it will be a victory for House Republican leaders, who crafted the measure to rebut President Obama’s claims that their party hasn’t done enough to help small businesses and entrepreneurs.
But several Senate Democrats say the bill doesn’t do enough to protect investors and small businesses from fraud.
“Its flaws are deeply worrisome. It threatens to dampen investment, and therefore dampen job growth,” said Sen. Carl Levin, Michigan Democrat. “Unless we protect investors, they will not invest in our economy.”
The White House supports the House package, though it also backs Senate Democratic efforts to strengthen investor safeguards.
A noted scientist who held sensitive positions in the U.S. government, developed state-of-the-art defense and space programs, and worked at the White House was sentenced Wednesday to 13 years in prison for attempted espionage, conspiracy to defraud the U.S. and tax evasion.
Stewart D. Nozette, 54, who also worked as a scientist for the departments of Energy and Defense and NASA, pleaded guilty in September to providing classified information to a person he believed to be an Israeli intelligence officer. He also pleaded guilty in January 2009 to fraud and tax charges stemming from more than $265,000 in false government claims.
The sentence was handed down by U.S. District Judge Paul L. Friedman, who also ordered that Nozette pay $217,000 to the government agencies he defrauded.
“Stewart Nozette’s greed exceeded his loyalty to our country,” said Ronald C. Machen Jr., U.S. attorney for the District of Columbia. “He wasted his talent and ruined his reputation by agreeing to sell national secrets to someone he believed was a foreign agent. His time in prison will provide him ample opportunity to reflect on his decision to betray the United States.”
The Justice Department said Nozette has been in custody since his Oct. 19, 2009, arrest on espionage charges while awaiting sentencing for fraud and tax evasion. FBI agents arrested Nozette after an undercover operation in which he provided classified materials on three occasions. The indictment does not claim that the government of Israel or anyone acting on its behalf committed any crimes.
The department said Nozette admitted that, from 2000 through 2006, he used the Alliance for Competitive Technology (ACT), a nonprofit group he organized in March 1990, to defraud the U.S. Naval Research Laboratory in Washington, the Defense Advanced Research Projects Agency in Arlington, and NASA’S Goddard Space Flight Center in Greenbelt by presenting more than $265,000 in fraudulent reimbursement claims, most of which were paid.
He also admitted that, from 2001 through 2005, he evaded more than $200,000 in federal taxes. In addition, he admitted using ACT, an entity exempt from taxation because of its nonprofit status, to receive income and to pay personal expenses, such as mortgages, automobile loans and other items.
The Justice Department said the ACT investigation led agents to suspect that Nozette — who held a topsecret security clearance and had frequent access to classified documents — had misused government information.
On Sept. 3, 2009, the department said Nozette was contacted by telephone by a person purporting to be an Israeli intelligence officer from the Mossad, but who was, in fact, an undercover FBI employee.
That same day, Nozette informed the undercover employee he had clearances “all the way to top secret” and that anything “the U.S. has done in space I’ve seen.” The department said he stated he would provide classified information for money and a foreign passport to a country without extradition to the United States.
A series of contacts followed over the next several weeks, including meetings in which Nozette took $10,000 in cash left by the FBI at prearranged drop-off sites, the department said. Nozette handed over secret and top-secret documents that included information on satellites, early-warning systems, defense and retaliatory strategies, and communications intelligence information.
The department said Nozette and the undercover employee met for the final time on Oct. 19, 2009, at the Mayflower Hotel, during which Nozette pushed for larger payments for the secrets he was disclosing. He reportedly said, “I gave you even in this first run, some of the most classified information that there is ... I’ve sort of crossed the Rubicon.”
“Stewart Nozette betrayed his country and the trust that was placed in him by attempting to sell some of America’s most closely guarded secrets for profit,” said Lisa Monaco, assistant attorney general for national security. “Today, he received the justice he deserves.”
Nozette was on the now-defunct National Space Council, part of the Executive Office of the President, under President George H.W. Bush.
“This [package] is exactly the kind of thing Americans have been asking for — greater freedom and flexibility,” said Senate Minority Leader Mitch Mcconnell. “That’s one of the reasons it’s had such overwhelming bipartisan support.”